8/13/2019 (D) Samuel U. Lee vs. KBC Bank N.v., GR NO. 164673, Juanuary 15, 2010

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Samuel U. Lee vs. KBC Bank N.V., GR NO. 164673, Juanuary 15, 2010

Facts:

Midas Diversified Export Corporation (MDEC) obtained a $1,400,000 and $ 65,000 loan from

KBC Bank N.V. (KBC Bank. Samuel U. Lee (Lee), assistant treasurer and director of MDEC,

executed a promissory note in favor of KBC Bank and a deed of assignment transferring allof MDECs rights over Confirmed Purchase Order No. MTC-548 and WC-128 to KBC Bank.

The Confirmed Purchase Orders No. MTC-548 were allegedly issued by Otto Versand.

MDEC defaulted on its obligation. This prompted KBC bank to verify the validity of the

purchase orders. A representative of Otto Versand denied the existence of the said purchase

orders via facsimile.

This prompted KBC bank to filed a suit for estafe against Lee and Lim. However, upon the

recommendation of the Secretary of Justice, which in part reads:

Since Ms. Pajarillo did not have personal knowledge of the fact that the

subject purchase orders were in fact fake, her testimony cannot be the basis

for finding probable cause against respondents. Ms. Pajarillo can testify only

to those facts that she knew of her personal knowledge. Admittedly, she

derived knowledge of the supposed spurious character of the purchase orders

from a mere fax copy of a message that [KBC Bank] received from a certain

representative of Otto Versand in Germany, someone who she did not even

know personally. Unfortunately, this fax copy is hearsay evidence and

therefore, inadmissible to prove the truth of what it contains (Pastor vs.

Gaspar, 2 Phil 592).

the prosecution filed a motion to withdraw the complaint. The motion was granted by

the RTC. The Judge did not state the reasons for granting the motion. He practicallyconcurred that the fax message was hearsay evidence and inadmissible.

Issue:

Whether or not the admissibility of the fax message may be properly ruled upon in a

preliminary investigation.

Ruling:

No.

Whether the facsimile message is admissible in evidence and whether the element ofdeceit in the crime of estafa is present are matters best ventilated in a full-blown

trial, not in the preliminary investigation. In Andres v. Justice Secretary Cuevas, the

Court held that:

[A preliminary investigation] is not the occasion for the full and exhaustive

display of [the prosecutions] evidence. The presence or absence of the

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elements of the crime is evidentiary in nature and is a matter of defense that

may be passed upon after a full-blown trial on the merits.

In fine, the validity and merits of a partys defense or accusation, as well as the

admissibility of testimonies and evidence, are better ventilated during trial properthan at the preliminary investigation level.