Dear Atty. Angela,

My husband and I own a food kiosk we have franchised and operated in a mall which we have operated for three years. Since we are very busy with our own regular jobs, we decided to sell the franchise rights to a good friend. On the day we signed the Deed of Assignment where it was agreed that he pays us post-dated checks in the amount of P1,000,000, he suddenly told us that he ran out of checks and promised to give them a week after. Since we have known him long, we trusted and allowed him to immediately take over our business operations. After a week, no PDCs were given to us and even after multiple calls and messages, he has completely been ignoring our messages. What case can we file against him?

Melissa

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Dear Melissa,

Based on your narrative, the buyer of your food kiosk can be held liable for Estafa under Article 315(2)(a) of the Revised Penal Code, which provides:

“Art. 315. Swindling (estafa). — Any person who shall defraud another by any of the means mentioned herein below shall be punished by:

x x x 2. By means of any of the following false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud:

(a) By using a fictitious name, or falsely pretending to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions; or by means of other similar deceits.”

In the case of People v. Bautista, G.R. No. 218582 (3 September 2020), the Supreme Court explained that Estafa under Article 315, paragraph 2 of the RPC is committed by any person who defrauds another by using fictitious name, or falsely pretends to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or by means of similar deceits executed prior to or simultaneously with the commission of the fraud. In this situational context, the offended party must have relied on the false pretense, fraudulent act or fraudulent means used by accused-appellant Bautista and sustained damages as a result thereof.

Here, the buyer made false pretenses and promises that he will pay what is due (through issuance of PDCs) on the day you and your husband entered into a Deed of Assignment and sold the franchise rights to him which includes the complete and entire management and operation of the business.

From the foregoing, there is existence of Estafa committed through deceit, such as his false pretense and fraudulent act, executed prior to or simultaneous with the commission of the fraud. You relied on his promise to pay through the delivery of the PDCs and you would not have pursued with the Agreement nor allowed the turnover of the entire business without that material representation.

Thus, it was his false pretense to pay which was the main and sole consideration that induced you to part with your business.

Atty. Angela Antonio