Don’t Let Your Check Bounce Back At You: What You Need To Know About B.P. 22

Introduction

Batas Pambansa Blg. 22, or commonly known as the Bouncing Checks Law, was enacted to penalize any person who draws or issues a check knowing that they don’t have sufficient funds or credit with the bank to cover its amount. The law aims to uphold the integrity and reliability of checks as a means of payment and to promote trust in commercial and financial transactions.

Under Section 1 of BP 22, the following are liable under the law:

1. Any person who makes or draws and issues any check to apply on account or for value, knowing at the time of issue that he does not have sufficient funds in or credit with the drawee bank for the payment of such check in full upon its presentment.

2. Any person who, having sufficient funds in or credit with the drawee bank when he makes or draws and issues a check, fail to keep sufficient funds or to maintain a credit to cover the full amount of the check if presented within a period of ninety (90) days from the date appearing thereon, for which reason it is dishonored by the drawee bank.

In simple terms, if you issue a check and it bounces due to lack of funds or credit, you can be held criminally liable—even if you eventually pay your debt.

Elements of BP 22

To be liable under BP 22, the following must be established:

1. The making, drawing, and issuance of any check to apply for account or for value (e.g. to pay for goods, services, or a loan).

2. The knowledge of the maker, drawer, or issuer that at the time of issue there were no sufficient funds in or credit with the drawee bank for the payment of such check in full upon its presentment; and

3. The dishonor of the check by the drawee bank for insufficiency or funds or credit or the dishonor for the same reason had not the drawer, without any valid cause, ordered the drawee bank to stop payment. (Maria Nympha Mandagan vs. Jose M. Valero Corporation, G.R. No. 215118, 19 June 2019)

Good Faith or Lack of Intent as a Valid Defense?

BP 22 is a malum prohibitum offense, which means intent is not necessary to establish the guilt of the person violated the law. Even if a person has no intention to defraud or is indeed in good faith, issuing a bad check is still punishable because the mere act itself is prohibited by law.

However, our jurisprudence is replete with cases that underscore the value of a notice of dishonor in BP 22 cases, and how the absence of proof of its receipt by the drawer can be a valid defense.

In Dela Cruz vs. People (G.R. 163494, 3 August 2016), the Supreme Court held that although a notice of dishonor is not an indispensable requirement in a prosecution for violation of BP 22, as it is not an element of the offense, evidence that a notice of dishonor has been sent to and received by the accused is actually sought as a means to prove the second element.

Thus, if the drawer was not properly notified of such dishonor, liability may not attach.            

Penalty for Violation of BP 22

Since violation of BP 22 is a criminal offense, it is punished by imprisonment of not less than thirty (30) days but not more than one (1) year. Aside from imprisonment, courts may also impose a fine of not less than but not more than double the amount of the check which shall in no case exceed Php2,000.00. Both imprisonment and fine may be imposed, at the discretion of the court.

Tips to Avoid BP 22 Violations

1. Always check your bank balance before drawing or issuing a check.

2. Document all transactions involving checks.

3. Respond promptly to notices from the bank or payee.

4. If you bounce a check, settle it within five (5) banking days after receiving the notice of dishonor.

5. Be honest and transparent in your financial dealings.

Final Thoughts

BP 22 plays a crucial role in safeguarding the integrity of financial and commercial transactions by holding individuals accountable for the issuance of unfunded or worthless checks. While the law imposes criminal liability, the courts recognize the importance of ensuring that it is not misused as a tool for oppression or harassment. If you are involved in a BP 22 case, or anticipating a potential exposure, it is strong advised that you seek legal counsel to fully understand your rights, possible defenses and available remedies under the law.

Issuing or receiving a bouncing check? Know your rights under BP 22 — and if things go south, bounce back with AVP Law by your side. Contact us at info@avplaw.net.