Jose vs. Suarez

When a trial court denies a motion to withdraw an information, it must independently assess the merits of the motion and embody that assessment in a written order stating the reasons for its disposition; a perfunctory denial without reference to the DOJ's findings or any discussion of the evidence constitutes grave abuse of discretion amounting to excess of jurisdiction.

Carolina B. Jose operated as a money lender in Cebu. Purita Suarez was a businesswoman engaged in hardware and construction who, facing serious liquidity problems, borrowed funds from Carolina beginning October 2003. The lending arrangement involved Purita issuing postdated checks equal to the loaned amount plus interest at rates that eventually reached 5% daily, inclusive of weekends and holidays. Purita separately filed a civil case for declaration of nullity of interest and collection of illegal interest against Carolina, docketed as Civil Case No. CEB 30278.

Carolina B. Jose, a money lender in Cebu, and Purita Suarez, a businesswoman engaged in hardware and construction, entered into a series of lending transactions beginning in October 2003. Purita, facing serious liquidity problems and needing to fund postdated checks she had issued to creditors, borrowed money from Carolina. The arrangement was that whenever loaned money was released, Purita would issue checks dated on the next banking day equal to the cash lent plus interest, initially at 1–2% per day and later increased to 5% daily, inclusive of weekends and holidays, until the checks cleared. According to Purita, Carolina collected approximately ₱33 million from her through this exorbitant interest scheme. The arrangement continued until April 2004, by which time Purita was no longer able to fund the checks she had issued to Carolina.

On April 26, 2004, Purita went to Carolina's house because she needed cash for her business. Carolina gave Purita the cash she required, on the condition that Purita pay interest at 5% monthly. In exchange, Purita issued 24 Chinabank checks all dated April 27, 2004, totaling ₱3.6 million. The checks were dishonored upon presentment for the reason "Account Closed." Carolina claimed she would not have parted with her money had the checks not been simultaneously delivered to her. Purita, for her part, maintained that the checks were issued merely to guarantee repayment of the loans and that the transactions were civil in character, not estafa.

Carolina filed two affidavit-complaints for estafa against Purita before the Office of the City Prosecutor of Cebu, one concerning 14 Chinabank checks totaling ₱1.5 million and the other pertaining to 10 Chinabank checks in the aggregate amount of ₱2.1 million, docketed as I.S. Nos. 04-5768-5782-G and 04-6060-6070-H, respectively. The City Prosecutor found probable cause to indict Purita for estafa in a Joint Resolution dated December 7, 2004, and the corresponding Information was filed, docketed as Criminal Case No. CBU-72619. Purita promptly filed a Petition for Review before the DOJ, which reversed the prosecutor's finding, ruled that the transactions were contracts of loan rather than estafa because Carolina was not deceived into parting with her money but acted on the expectation of earning interest, and directed the City Prosecutor to move for withdrawal of the Information.

Pursuant to the DOJ's directive, City Prosecutor Nicolas C. Sellon moved for withdrawal of the Information before the RTC. The RTC denied the motion in its December 9, 2005 Order, simply stating it was "unmeritorious" without further elaboration or any reference to the DOJ's findings. Purita moved for reconsideration, calling the RTC's attention to the DOJ's findings and to the Supreme Court's ruling in People vs. Cuyugan, which allegedly involved a similar factual setting. The RTC denied the motion on February 17, 2006, again without discussion, and on March 10, 2006 reiterated the denial, stating only that the 5% interest was a matter of defense and that the prosecution had established Carolina would not have parted with her money without the delivery of checks. Purita then elevated the matter to the CA via a petition for certiorari, which granted the petition, set aside the RTC's orders, and granted the Motion to Withdraw Information, effectively dismissing the criminal case.

• RTC's Independent Evaluation: Carolina maintained that the RTC independently evaluated the merits of the case and correctly adjudged to maintain the estafa charge against Purita, this being an exercise of the trial court's sole prerogative which the CA cannot replace.
• Trial Court Jurisdiction: Carolina argued that the RTC's own evaluation of a prima facie case for estafa is a matter within the trial court's jurisdiction that should not be disturbed by the CA.

• Grave Abuse of Discretion: Purita alleged that the RTC's orders failed to explain why the Motion to Withdraw Information was denied, amounting to grave abuse of discretion because the judge failed to make an independent evaluation of the merits of the case in determining probable cause.
• Civil in Character: Purita stressed that the RTC should have granted the Motion to Withdraw Information because her case is clearly civil in character and does not constitute estafa, the checks having been issued merely as guarantees of repayment.

• Grave Abuse of Discretion: Whether the RTC committed grave abuse of discretion in denying the Motion to Withdraw Information without independently evaluating the merits of the case.
• Propriety of CA's Disposition: Whether the CA erred in granting the Motion to Withdraw Information and dismissing the criminal case, or whether the proper remedy was remand to the RTC for proper evaluation.

• Grave Abuse of Discretion: Yes. The RTC committed grave abuse of discretion amounting to excess of jurisdiction by perfunctorily denying the motion without stating cogent reasons, referencing the DOJ's findings, or making any independent assessment of the evidence.
• Propriety of CA's Disposition: The CA correctly found grave abuse of discretion but should not have outright granted the withdrawal and dismissed the case; the proper disposition was to remand the case to the RTC for a thorough and independent evaluation of the merits.

• Grave Abuse of Discretion: When a trial court is confronted with a motion to dismiss or to withdraw an information, it is its bounden duty to independently assess the merits of the motion and embody that assessment in a written order. The RTC's December 9, 2005 Order merely declared the motion "unmeritorious" without elaborating on the bases of its conclusion and without any reference to the DOJ's findings. The February 17, 2006 Order denying reconsideration was equally barren of reasoning. The March 10, 2006 Order merely stated that the 5% interest was a matter of defense and that the prosecution had established Carolina would not have parted with her money without the checks, without discussing how it reached that conclusion or how the DOJ's findings impacted its ruling. The RTC failed to positively state that the evidence against Purita was sufficient for estafa, include a discussion on the merits, assess whether the DOJ's conclusion was supported by evidence, examine the basis of the DOJ's recommendation, embody its assessment in the orders, or state the reasons for denying the motion. Such perfunctory denial constituted grave abuse of discretion amounting to excess of jurisdiction, and the CA did not err in so declaring.

• Propriety of CA's Disposition: While the CA correctly identified the RTC's grave abuse of discretion, the proper remedy was not for the CA to substitute its own evaluation and outright grant the withdrawal of the Information. The trial court must be given the opportunity to perform its bounden duty — to make an independent and thorough evaluation of the merits, clearly state whether the evidence is sufficient to make out a case for estafa, and determine whether the DOJ's conclusion is supported by evidence. The Court therefore partly granted the petition by sustaining the CA's finding of grave abuse of discretion but modified the disposition by remanding the case to the RTC for further proceedings in accordance with the required independent evaluation.

• Trial Court's Duty in Motions to Withdraw Information — When a trial court is confronted with a motion to dismiss a case or to withdraw an information, it is its bounden duty to independently assess the merits of the motion, and this assessment must be embodied in a written order disposing of the motion. The order must: (1) positively state that the evidence against the accused is sufficient to make out a case; (2) include a discussion on the merits of the case; (3) assess whether the DOJ's conclusion is supported by evidence; (4) look at the basis of the DOJ's recommendation; (5) embody the court's assessment in the order; and (6) state the reasons for granting or denying the motion. Failure to comply constitutes grave abuse of discretion amounting to excess of jurisdiction. The Court applied this doctrine by finding that the RTC's orders fell short on all six requisites.

• "When a trial court is confronted to rule on 'a motion to dismiss a case or to withdraw an Information', it is its 'bounden duty to assess independently the merits of the motion, and this assessment must be embodied in a written order disposing of the motion.'" — This passage states the controlling rule governing a trial court's obligation when ruling on a motion to withdraw information, forming the ratio decidendi of the case.

• "The RTC simply declared that it was denying the motion for being 'unmeritorious,' without further elaborating on the bases of its conclusion. Moreover, there is nary any reference made to the findings of the DOJ." — This passage illustrates the specific deficiencies in the RTC's orders that constituted grave abuse of discretion, demonstrating how the rule applies in practice.

• "The trial court is therefore directed to make an independent and thorough evaluation of the merits of the case. It must clearly state whether the evidence presented is sufficient to make out a case for estafa and whether the DOJ's conclusion is supported by evidence." — This passage defines the scope of the remand and the specific tasks the trial court must perform on remand.

• Cerezo vs. People, G.R. No. 185230, June 1, 2011 — Controlling authority cited for the proposition that a trial court has the bounden duty to independently assess the merits of a motion to dismiss or withdraw an information and embody that assessment in a written order.
• Lee vs. KBC Bank N.V., G.R. No. 164673, January 15, 2010 — Followed for the six-part enumeration of what a trial court's order on a motion to withdraw information must contain: positively state sufficiency of evidence, discuss merits, assess DOJ's conclusion, examine the basis of the DOJ's recommendation, embody the assessment, and state reasons.
• Co vs. Lim, G.R. Nos. 164669-70, October 30, 2009 — Cited for the principle that a trial court's failure to perform its duty of independent evaluation constitutes grave abuse of discretion amounting to excess of jurisdiction.
• People vs. Cuyugan, 440 Phil. 637 (2002) — Cited by respondent Purita in her motion for reconsideration before the RTC as allegedly having a similar factual setting; the RTC gave it scant consideration.

• Section 13, Article VIII, Constitution — Cited in the certification by the Chief Justice attesting that the conclusions in the decision were reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.

Antonio T. Carpio (Chairperson), Jose Portugal Perez, Jose Catral Mendoza, and Estela M. Perlas-Bernabe concurred in the decision.