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    People v. Nitafan

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    dwight yu
    The Supreme Court ruled that a private respondent who received goods worth P398,000 from a bank under a trust receipt agreement, with the obligation to sell the goods and account for the proceeds or return the goods if unsold, and failed to pay P114,884.22, was liable for the crime of estafa. A trust receipt arrangement has features of both a loan and security agreement. The Trust Receipts Law punishes dishonesty and abuse of confidence in handling money or goods, regardless of ownership. It does not seek to enforce debt payment. Upholding trust receipt agreements protects public interest in trade and banking.

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    People v. Nitafan

    Uploaded by

    dwight yu
    80 views1 page
    The Supreme Court ruled that a private respondent who received goods worth P398,000 from a bank under a trust receipt agreement, with the obligation to sell the goods and account for the proceeds or return the goods if unsold, and failed to pay P114,884.22, was liable for the crime of estafa. A trust receipt arrangement has features of both a loan and security agreement. The Trust Receipts Law punishes dishonesty and abuse of confidence in handling money or goods, regardless of ownership. It does not seek to enforce debt payment. Upholding trust receipt agreements protects public interest in trade and banking.

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    The Supreme Court ruled that a private respondent who received goods worth P398,000 from a bank under a trust receipt agreement, with the obligation to sell the goods and account for the proceeds or return the goods if unsold, and failed to pay P114,884.22, was liable for the crime of estafa. A trust receipt arrangement has features of both a loan and security agreement. The Trust Receipts Law punishes dishonesty and abuse of confidence in handling money or goods, regardless of ownership. It does not seek to enforce debt payment. Upholding trust receipt agreements protects public interest in trade and banking.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    80 views1 page

    People v. Nitafan

    Uploaded by

    dwight yu
    The Supreme Court ruled that a private respondent who received goods worth P398,000 from a bank under a trust receipt agreement, with the obligation to sell the goods and account for the proceeds or return the goods if unsold, and failed to pay P114,884.22, was liable for the crime of estafa. A trust receipt arrangement has features of both a loan and security agreement. The Trust Receipts Law punishes dishonesty and abuse of confidence in handling money or goods, regardless of ownership. It does not seek to enforce debt payment. Upholding trust receipt agreements protects public interest in trade and banking.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    2. People v.

    Nitafan 207 SCRA 726 (1992)

    FACTS:
    In 1980, petitioner Allied banking Corporation (ABC) charged private respondent, Betty Sia Ang, for estafa for
    defrauding ABC. Private respondent Ang, then proprietess of Eckart Enterprises, received in trust Gordon
    Plastics, plastic sheeting and Hook Chromed from ABC amounting to P398,000.00 covered by a domestic letter
    of credit, under the express obligation to sell the same and account for the proceeds of the sale, if sold, or to
    return the merchandise, if not sold. Upon demand, private respondent paid only P283,115.78.
    Betty Sia Ang filed a motion to quash the information on the ground that the facts charged do not constitute an
    offense. Respondent Judge Nitafan granted the motion to quash anchored on the premise that a trust receipt
    transaction is an evidence of a loan being secured so that there is, as between the parties to it, a creditor-debtor
    relationship. Hence this petition.

    ISSUE: W/N an entrustee in a trust receipt agreement who fails to deliver the proceeds of the sale or to return
    the goods if not sold to the entruster-bank is liable for the crime of estafa.

    RULING & MAIN POINT IN BOLD:


    YES. Alleged violation was committed sometime in 1980 or during the effectivity of P.D. 115 (January 29, 1973).
    Said law provides Acts involving the violation of trust receipt agreements occurring after date of enactment
    would make the accused criminally liable for estafa. The failure, therefore, to account for the P114,884.22
    balance makes the accused-respondent criminally liable for estafa.
    A trust receipt arrangement does not involve a simple loan transaction between a creditor and debtor-importer.
    Apart from a loan feature, the trust receipt arrangement has a security feature that is covered by the trust
    receipt itself. That second feature is what provides the much needed financial assistance to our traders in the
    importation or purchase of goods or merchandise through the use of those goods or merchandise as collateral
    for the advancements made by a bank. The title of the bank to the security is the one sought to be protected
    and not the loan which is a separate and distinct agreement.
    The Trust Receipts Law punishes the dishonesty and abuse of confidence in the handling of money or goods
    to the prejudice of another regardless of whether the latter is the owner or not. The law does not seek to
    enforce payment of the loan. Thus, there can be no violation of a right against imprisonment for non-payment
    of a debt.
    Trust receipts are indispensable contracts in international and domestic business transactions. The prevalent
    use of trust receipts, the danger of their misuse and/or misappropriation of the goods or proceeds realized from
    the sale of goods, documents or instruments held in trust for entruster-banks, and the need for regulation of
    trust receipt transactions to safeguard the rights and enforce the obligations of the parties involved are the
    main thrusts of P.D. 115. Like BP Blg. 22, it punishes the act "not as an offense against property, but as an
    offense against public order”. The misuse of trust receipts therefore should be deterred to prevent any
    possible havoc in trade circles and the banking community. It is in the context of upholding public interest
    that the law now specifically designates a breach of a trust receipt agreement to be an act that "shall" make
    one liable for estafa.

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