Remo vs.

Devandera
GR No. 192925
December 9, 2016

Perez, J.
Facts: In 2004, BATELEC II entered into two (2) contracts that required it to spend a total of
P81,100,000.00. The first contract was entered into by BATELEC II with the I-SOLV
Technologies, Inc. (ITI). The contract was for the enterprise-wide automation and
computerization of BATELEC II. Pursuant to the said contract, BATELEC II obligated itself to
pay an aggregate amount of P75,000,000.00 to ITI in exchange of the total computerization
solutions to be provided by the latter. The second contract, on the other hand, was with the
Supertrac Motors Corporation (Supertrac) and it was for the procurement of ten (10) boom
trucks by BATELEC II. Under such contract, BATELEC II agreed to pay the sum of
P6,100,000.00 to Supertrac as consideration for the ten (10) boom trucks to be supplied by the
latter. In 2005, NEA audit report found out that ITI and Supertracs as having been replete with
various irregularities and violation of guidelines including the award for computerization contract
of ITI and and such contract was implemented without prior approval from NEA. A complaint
was filed before the RTC by the respondents (Batelec) against petitioner for violation of the
crime of Syndicated Estafa under PD No. 1689 in relation to Art. 315 of the RPC. The RTC
rendered a decision finding petitioners guilty for Syndicated Estafa under PD No. 1689. On
Appeal, the CA affirmed the decision of the trial court.
Issue: Whether or not the petitioners are criminally liable for Syndicated Estafa under PD No.
1689.
Ruling: No. Hence, we grant the instant appeal.
In essence, Syndicated estafa is but the commission of any of Estafa enumerated under Art 315
of the RPC with 2 additional conditions.
1. Estafa or swindling was perpetrated by a syndicate.
2. Estafa or swindling resulted in the misappropriation of money contributed by the
stockholder or members of rural bank, corporations/associations
Thus, we detailed the elements of Syndicated Estafa as provided in People vs. Balasa:
1. Estafa or other forms of swindling mentioned in Article 315 and 316 of the RPC
2. It is committed by a syndicate.
3. Estafa or swindling resulted in the misappropriation of money contributed by the
stockholder or members of rural bank, corporations/associations
In the case at bar, It is well settled in jurisdiction that Syndicate must be 5 or more persons who
used the association that they formed or they managed to defraud its own stockholders and
members. Consequently, Petitioners did not use Batelec II as a means to defraud its members.
It follows that the fraud committed through such association must pertain to its receipt of
contribution or solicitation from the members or to the public. Furthermore, The contributions of
the members of BATELEC II were received by the latter through legitimate transactions. Lastly,
the second element of Estafa under Art 315 of the RPC is non existent. Misappropriation or
conversion means the act of disposing of another’s property as if it were one’s own or of
devoting it to a purpose or use different from that agreed upon. Given the evidence at hand, any
prejudiced caused upon Batelec II may only give rise to civil liability.

WHEREFORE, the petition is hereby GRANTED.