g.r. no. 155076 laurel v abrogar

9/7/15, 10:42 PMG.R. No. 155076

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Today is Monday, September 07, 2015

Republic of the PhilippinesSUPREME COURT

Manila

FIRST DIVISION

G.R. No. 155076 February 27, 2006

LUIS MARCOS P. LAUREL, Petitioner, vs.HON. ZEUS C. ABROGAR, Presiding Judge of the Regional Trial Court, Makati City, Branch 150, PEOPLE OFTHE PHILIPPINES& PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, Respondents.

D E C I S I O N

CALLEJO, SR., J.:

Before us is a Petition for Review on Certiorari of the Decision1 of the Court of Appeals (CA) in CA-G.R. SP No.68841 affirming the Order issued by Judge Zeus C. Abrogar, Regional Trial Court (RTC), Makati City, Branch 150,which denied the "Motion to Quash (With Motion to Defer Arraignment)" in Criminal Case No. 99-2425 for theft.

Philippine Long Distance Telephone Company (PLDT) is the holder of a legislative franchise to render local andinternational telecommunication services under Republic Act No. 7082.2 Under said law, PLDT is authorized toestablish, operate, manage, lease, maintain and purchase telecommunication systems, including transmitting,receiving and switching stations, for both domestic and international calls. For this purpose, it has installed anestimated 1.7 million telephone lines nationwide. PLDT also offers other services as authorized by Certificates ofPublic Convenience and Necessity (CPCN) duly issued by the National Telecommunications Commission (NTC),and operates and maintains an International Gateway Facility (IGF). The PLDT network is thus principally composedof the Public Switch Telephone Network (PSTN), telephone handsets and/or telecommunications equipment used byits subscribers, the wires and cables linking said telephone handsets and/or telecommunications equipment,antenna, the IGF, and other telecommunications equipment which provide interconnections.3 1avvphil.net

PLDT alleges that one of the alternative calling patterns that constitute network fraud and violate its network integrityis that which is known as International Simple Resale (ISR). ISR is a method of routing and completing internationallong distance calls using International Private Leased Lines (IPL), cables, antenna or air wave or frequency, whichconnect directly to the local or domestic exchange facilities of the terminating country (the country where the call isdestined). The IPL is linked to switching equipment which is connected to a PLDT telephone line/number. In theprocess, the calls bypass the IGF found at the terminating country, or in some instances, even those from theoriginating country.4

One such alternative calling service is that offered by Baynet Co., Ltd. (Baynet) which sells "Bay Super Orient Card"phone cards to people who call their friends and relatives in the Philippines. With said card, one is entitled to a 27-minute call to the Philippines for about ¥37.03 per minute. After dialing the ISR access number indicated in thephone card, the ISR operator requests the subscriber to give the PIN number also indicated in the phone card. Oncethe caller’s identity (as purchaser of the phone card) is confirmed, the ISR operator will then provide a Philippinelocal line to the requesting caller via the IPL. According to PLDT, calls made through the IPL never pass the tollcenter of IGF operators in the Philippines. Using the local line, the Baynet card user is able to place a call to anypoint in the Philippines, provided the local line is National Direct Dial (NDD) capable.5

PLDT asserts that Baynet conducts its ISR activities by utilizing an IPL to course its incoming international longdistance calls from Japan. The IPL is linked to switching equipment, which is then connected to PLDT telephonelines/numbers and equipment, with Baynet as subscriber. Through the use of the telephone lines and other auxiliaryequipment, Baynet is able to connect an international long distance call from Japan to any part of the Philippines,and make it appear as a call originating from Metro Manila. Consequently, the operator of an ISR is able to evadepayment of access, termination or bypass charges and accounting rates, as well as compliance with the regulatoryrequirements of the NTC. Thus, the ISR operator offers international telecommunication services at a lower rate, tothe damage and prejudice of legitimate operators like PLDT.6

PLDT pointed out that Baynet utilized the following equipment for its ISR activities: lines, cables, and antennas orequipment or device capable of transmitting air waves or frequency, such as an IPL and telephone lines andequipment; computers or any equipment or device capable of accepting information applying the prescribed processof the information and supplying the result of this process; modems or any equipment or device that enables a dataterminal equipment such as computers to communicate with other data terminal equipment via a telephone line;multiplexers or any equipment or device that enables two or more signals from different sources to pass through a

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common cable or transmission line; switching equipment, or equipment or device capable of connecting telephonelines; and software, diskettes, tapes or equipment or device used for recording and storing information.7

PLDT also discovered that Baynet subscribed to a total of 123 PLDT telephone lines/numbers.8 Based on the TrafficStudy conducted on the volume of calls passing through Baynet’s ISR network which bypass the IGF toll center,PLDT incurred an estimated monthly loss of P10,185,325.96.9 Records at the Securities and Exchange Commission(SEC) also revealed that Baynet was not authorized to provide international or domestic long distance telephoneservice in the country. The following are its officers: Yuji Hijioka, a Japanese national (chairman of the board ofdirectors); Gina C. Mukaida, a Filipina (board member and president); Luis Marcos P. Laurel, a Filipino (boardmember and corporate secretary); Ricky Chan Pe, a Filipino (board member and treasurer); and Yasushi Ueshima,also a Japanese national (board member).

Upon complaint of PLDT against Baynet for network fraud, and on the strength of two search warrants10 issued bythe RTC of Makati, Branch 147, National Bureau of Investigation (NBI) agents searched its office at the 7th Floor,SJG Building, Kalayaan Avenue, Makati City on November 8, 1999. Atsushi Matsuura, Nobuyoshi Miyake, EdourdD. Lacson and Rolando J. Villegas were arrested by NBI agents while in the act of manning the operations ofBaynet. Seized in the premises during the search were numerous equipment and devices used in its ISR activities,such as multiplexers, modems, computer monitors, CPUs, antenna, assorted computer peripheral cords andmicroprocessors, cables/wires, assorted PLDT statement of accounts, parabolic antennae and voltage regulators.

State Prosecutor Ofelia L. Calo conducted an inquest investigation and issued a Resolution11 on January 28, 2000,finding probable cause for theft under Article 308 of the Revised Penal Code and Presidential Decree No. 40112

against the respondents therein, including Laurel.

On February 8, 2000, State Prosecutor Calo filed an Information with the RTC of Makati City charging Matsuura,Miyake, Lacson and Villegas with theft under Article 308 of the Revised Penal Code. After conducting the requisitepreliminary investigation, the State Prosecutor filed an Amended Information impleading Laurel (a partner in the lawfirm of Ingles, Laurel, Salinas, and, until November 19, 1999, a member of the board of directors and corporatesecretary of Baynet), and the other members of the board of directors of said corporation, namely, Yuji Hijioka,Yasushi Ueshima, Mukaida, Lacson and Villegas, as accused for theft under Article 308 of the Revised Penal Code.The inculpatory portion of the Amended Information reads:

On or about September 10-19, 1999, or prior thereto, in Makati City, and within the jurisdiction of this HonorableCourt, the accused, conspiring and confederating together and all of them mutually helping and aiding one another,with intent to gain and without the knowledge and consent of the Philippine Long Distance Telephone (PLDT), didthen and there willfully, unlawfully and feloniously take, steal and use the international long distance calls belongingto PLDT by conducting International Simple Resale (ISR), which is a method of routing and completing internationallong distance calls using lines, cables, antennae, and/or air wave frequency which connect directly to the local ordomestic exchange facilities of the country where the call is destined, effectively stealing this business from PLDTwhile using its facilities in the estimated amount of P20,370,651.92 to the damage and prejudice of PLDT, in the saidamount.

CONTRARY TO LAW.13

Accused Laurel filed a "Motion to Quash (with Motion to Defer Arraignment)" on the ground that the factualallegations in the Amended Information do not constitute the felony of theft under Article 308 of the Revised PenalCode. He averred that the Revised Penal Code, or any other special penal law for that matter, does not prohibit ISRoperations. He claimed that telephone calls with the use of PLDT telephone lines, whether domestic or international,belong to the persons making the call, not to PLDT. He argued that the caller merely uses the facilities of PLDT, andwhat the latter owns are the telecommunication infrastructures or facilities through which the call is made. He alsoasserted that PLDT is compensated for the caller’s use of its facilities by way of rental; for an outgoing overseas call,PLDT charges the caller per minute, based on the duration of the call. Thus, no personal property was stolen fromPLDT. According to Laurel, the P20,370,651.92 stated in the Information, if anything, represents the rental for theuse of PLDT facilities, and not the value of anything owned by it. Finally, he averred that the allegations in theAmended Information are already subsumed under the Information for violation of Presidential Decree (P.D.) No.401 filed and pending in the Metropolitan Trial Court of Makati City, docketed as Criminal Case No. 276766.

The prosecution, through private complainant PLDT, opposed the motion,14 contending that the movant unlawfullytook personal property belonging to it, as follows: 1) intangible telephone services that are being offered by PLDTand other telecommunication companies, i.e., the connection and interconnection to their telephone lines/facilities;2) the use of those facilities over a period of time; and 3) the revenues derived in connection with the rendition ofsuch services and the use of such facilities.15

The prosecution asserted that the use of PLDT’s intangible telephone services/facilities allows electronic voicesignals to pass through the same, and ultimately to the called party’s number. It averred that such service/facility isakin to electricity which, although an intangible property, may, nevertheless, be appropriated and be the subject oftheft. Such service over a period of time for a consideration is the business that PLDT provides to its customers,which enables the latter to send various messages to installed recipients. The service rendered by PLDT is akin tomerchandise which has specific value, and therefore, capable of appropriation by another, as in this case, throughthe ISR operations conducted by the movant and his co-accused.

The prosecution further alleged that "international business calls and revenues constitute personal property










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envisaged in Article 308 of the Revised Penal Code." Moreover, the intangible telephone services/facilities belong toPLDT and not to the movant and the other accused, because they have no telephone services and facilities of theirown duly authorized by the NTC; thus, the taking by the movant and his co-accused of PLDT services was withintent to gain and without the latter’s consent.

The prosecution pointed out that the accused, as well as the movant, were paid in exchange for their illegalappropriation and use of PLDT’s telephone services and facilities; on the other hand, the accused did not pay asingle centavo for their illegal ISR operations. Thus, the acts of the accused were akin to the use of a "jumper" by aconsumer to deflect the current from the house electric meter, thereby enabling one to steal electricity. Theprosecution emphasized that its position is fortified by the Resolutions of the Department of Justice in PLDT v.Tiongson, et al. (I.S. No. 97-0925) and in PAOCTF-PLDT v. Elton John Tuason, et al. (I.S. No. 2000-370) whichwere issued on August 14, 2000 finding probable cause for theft against the respondents therein.

On September 14, 2001, the RTC issued an Order16 denying the Motion to Quash the Amended Information. Thecourt declared that, although there is no law that expressly prohibits the use of ISR, the facts alleged in theAmended Information "will show how the alleged crime was committed by conducting ISR," to the damage andprejudice of PLDT.

Laurel filed a Motion for Reconsideration17 of the Order, alleging that international long distance calls are notpersonal property, and are not capable of appropriation. He maintained that business or revenue is not consideredpersonal property, and that the prosecution failed to adduce proof of its existence and the subsequent loss ofpersonal property belonging to another. Citing the ruling of the Court in United States v. De Guzman,18 Laurelaverred that the case is not one with telephone calls which originate with a particular caller and terminates with thecalled party. He insisted that telephone calls are considered privileged communications under the Constitution andcannot be considered as "the property of PLDT." He further argued that there is no kinship between telephone callsand electricity or gas, as the latter are forms of energy which are generated and consumable, and may beconsidered as personal property because of such characteristic. On the other hand, the movant argued, thetelephone business is not a form of energy but is an activity.

In its Order19 dated December 11, 2001, the RTC denied the movant’s Motion for Reconsideration. This time, itruled that what was stolen from PLDT was its "business" because, as alleged in the Amended Information, theinternational long distance calls made through the facilities of PLDT formed part of its business. The RTC noted thatthe movant was charged with stealing the business of PLDT. To support its ruling, it cited Strochecker v. Ramirez,20

where the Court ruled that interest in business is personal property capable of appropriation. It further declared that,through their ISR operations, the movant and his co-accused deprived PLDT of fees for international long distancecalls, and that the ISR used by the movant and his co-accused was no different from the "jumper" used for stealingelectricity.

Laurel then filed a Petition for Certiorari with the CA, assailing the Order of the RTC. He alleged that the respondentjudge gravely abused his discretion in denying his Motion to Quash the Amended Information.21 As gleaned fromthe material averments of the amended information, he was charged with stealing the international long distancecalls belonging to PLDT, not its business. Moreover, the RTC failed to distinguish between the business of PLDT(providing services for international long distance calls) and the revenues derived therefrom. He opined that a"business" or its revenues cannot be considered as personal property under Article 308 of the Revised Penal Code,since a "business" is "(1) a commercial or mercantile activity customarily engaged in as a means of livelihood andtypically involving some independence of judgment and power of decision; (2) a commercial or industrial enterprise;and (3) refers to transactions, dealings or intercourse of any nature." On the other hand, the term "revenue" isdefined as "the income that comes back from an investment (as in real or personal property); the annual orperiodical rents, profits, interests, or issues of any species of real or personal property."22

Laurel further posited that an electric company’s business is the production and distribution of electricity; a gascompany’s business is the production and/or distribution of gas (as fuel); while a water company’s business is theproduction and distribution of potable water. He argued that the "business" in all these cases is the commercialactivity, while the goods and merchandise are the products of such activity. Thus, in prosecutions for theft of certainforms of energy, it is the electricity or gas which is alleged to be stolen and not the "business" of providing electricityor gas. However, since a telephone company does not produce any energy, goods or merchandise and merelyrenders a service or, in the words of PLDT, "the connection and interconnection to their telephone lines/facilities,"such service cannot be the subject of theft as defined in Article 308 of the Revised Penal Code.23

He further declared that to categorize "business" as personal property under Article 308 of the Revised Penal Codewould lead to absurd consequences; in prosecutions for theft of gas, electricity or water, it would then be permissibleto allege in the Information that it is the gas business, the electric business or the water business which has beenstolen, and no longer the merchandise produced by such enterprise.24

Laurel further cited the Resolution of the Secretary of Justice in Piltel v. Mendoza,25 where it was ruled that theRevised Penal Code, legislated as it was before present technological advances were even conceived, is notadequate to address the novel means of "stealing" airwaves or airtime. In said resolution, it was noted that theinadequacy prompted the filing of Senate Bill 2379 (sic) entitled "The Anti-Telecommunications Fraud of 1997" todeter cloning of cellular phones and other forms of communications fraud. The said bill "aims to protect in number(ESN) (sic) or Capcode, mobile identification number (MIN), electronic-international mobile equipment identity(EMEI/IMEI), or subscriber identity module" and "any attempt to duplicate the data on another cellular phone without











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the consent of a public telecommunications entity would be punishable by law."26 Thus, Laurel concluded, "there isno crime if there is no law punishing the crime."

On August 30, 2002, the CA rendered judgment dismissing the petition.27 The appellate court ruled that a petitionfor certiorari under Rule 65 of the Rules of Court was not the proper remedy of the petitioner. On the merits of thepetition, it held that while business is generally an activity

which is abstract and intangible in form, it is nevertheless considered "property" under Article 308 of the RevisedPenal Code. The CA opined that PLDT’s business of providing international calls is personal property which may bethe object of theft, and cited United States v. Carlos28 to support such conclusion. The tribunal also citedStrochecker v. Ramirez,29 where this Court ruled that one-half interest in a day’s business is personal propertyunder Section 2 of Act No. 3952, otherwise known as the Bulk Sales Law. The appellate court held that theoperations of the ISR are not subsumed in the charge for violation of P.D. No. 401.

Laurel, now the petitioner, assails the decision of the CA, contending that -

THE COURT OF APPEALS ERRED IN RULING THAT THE PERSONAL PROPERTY ALLEGEDLY STOLENPER THE INFORMATION IS NOT THE "INTERNATIONAL LONG DISTANCE CALLS" BUT THE "BUSINESSOF PLDT."

THE COURT OF APPEALS ERRED IN RULING THAT THE TERM "BUSINESS" IS PERSONAL PROPERTYWITHIN THE MEANING OF ART. 308 OF THE REVISED PENAL CODE.30

Petitioner avers that the petition for a writ of certiorari may be filed to nullify an interlocutory order of the trial courtwhich was issued with grave abuse of discretion amounting to excess or lack of jurisdiction. In support of his petitionbefore the Court, he reiterates the arguments in his pleadings filed before the CA. He further claims that while theright to carry on a business or an interest or participation in business is considered property under the New CivilCode, the term "business," however, is not. He asserts that the Philippine Legislature, which approved the RevisedPenal Code way back in January 1, 1932, could not have contemplated to include international long distance callsand "business" as personal property under Article 308 thereof.

In its comment on the petition, the Office of the Solicitor General (OSG) maintains that the amended informationclearly states all the essential elements of the crime of theft. Petitioner’s interpretation as to whether an"international long distance call" is personal property under the law is inconsequential, as a reading of the amendedinformation readily reveals that specific acts and circumstances were alleged charging Baynet, through its officers,including petitioner, of feloniously taking, stealing and illegally using international long distance calls belonging torespondent PLDT by conducting ISR operations, thus, "routing and completing international long distance callsusing lines, cables, antenna and/or airwave frequency which connect directly to the local or domestic exchangefacilities of the country where the call is destined." The OSG maintains that the international long distance callsalleged in the amended information should be construed to mean "business" of PLDT, which, while abstract andintangible in form, is personal property susceptible of appropriation.31 The OSG avers that what was stolen bypetitioner and his co-accused is the business of PLDT providing international long distance calls which, thoughintangible, is personal property of the PLDT.32

For its part, respondent PLDT asserts that personal property under Article 308 of the Revised Penal Codecomprehends intangible property such as electricity and gas which are valuable articles for merchandise, broughtand sold like other personal property, and are capable of appropriation. It insists that the business of internationalcalls and revenues constitute personal property because the same are valuable articles of merchandise. Therespondent reiterates that international calls involve (a) the intangible telephone services that are being offered by it,that is, the connection and interconnection to the telephone network, lines or facilities; (b) the use of its telephonenetwork, lines or facilities over a period of time; and (c) the income derived in connection therewith.33

PLDT further posits that business revenues or the income derived in connection with the rendition of such servicesand the use of its telephone network, lines or facilities are personal properties under Article 308 of the RevisedPenal Code; so is the use of said telephone services/telephone network, lines or facilities which allow electronicvoice signals to pass through the same and ultimately to the called party’s number. It is akin to electricity which,though intangible property, may nevertheless be appropriated and can be the object of theft. The use of respondentPLDT’s telephone network, lines, or facilities over a period of time for consideration is the business that it providesto its customers, which enables the latter to send various messages to intended recipients. Such use over a periodof time is akin to merchandise which has value and, therefore, can be appropriated by another. According torespondent PLDT, this is what actually happened when petitioner Laurel and the other accused below conductedillegal ISR operations.34

The petition is meritorious.

The issues for resolution are as follows: (a) whether or not the petition for certiorari is the proper remedy of thepetitioner in the Court of Appeals; (b) whether or not international telephone calls using Bay Super Orient Cardsthrough the telecommunication services provided by PLDT for such calls, or, in short, PLDT’s business of providingsaid telecommunication services, are proper subjects of theft under Article 308 of the Revised Penal Code; and (c)whether or not the trial court committed grave abuse of discretion amounting to excess or lack of jurisdiction indenying the motion of the petitioner to quash the amended information.










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On the issue of whether or not the petition for certiorari instituted by the petitioner in the CA is proper, the generalrule is that a petition for certiorari under Rule 65 of the Rules of Court, as amended, to nullify an order denying amotion to quash the Information is inappropriate because the aggrieved party has a remedy of appeal in the ordinarycourse of law. Appeal and certiorari are mutually exclusive of each other. The remedy of the aggrieved party is tocontinue with the case in due course and, when an unfavorable judgment is rendered, assail the order and thedecision on appeal. However, if the trial court issues the order denying the motion to quash the AmendedInformation with grave abuse of discretion amounting to excess or lack of jurisdiction, or if such order is patentlyerroneous, or null and void for being contrary to the Constitution, and the remedy of appeal would not affordadequate and expeditious relief, the accused may resort to the extraordinary remedy of certiorari.35 A special civilaction for certiorari is also available where there are special circumstances clearly demonstrating the inadequacy ofan appeal. As this Court held in Bristol Myers Squibb (Phils.), Inc. v. Viloria:36

Nonetheless, the settled rule is that a writ of certiorari may be granted in cases where, despite availability of appealafter trial, there is at least a prima facie showing on the face of the petition and its annexes that: (a) the trial courtissued the order with grave abuse of discretion amounting to lack of or in excess of jurisdiction; (b) appeal would notprove to be a speedy and adequate remedy; (c) where the order is a patent nullity; (d) the decision in the presentcase will arrest future litigations; and (e) for certain considerations such as public welfare and public policy.37

In his petition for certiorari in the CA, petitioner averred that the trial court committed grave abuse of its discretionamounting to excess or lack of jurisdiction when it denied his motion to quash the Amended Information despite hisclaim that the material allegations in the Amended Information do not charge theft under Article 308 of the RevisedPenal Code, or any offense for that matter. By so doing, the trial court deprived him of his constitutional right to beinformed of the nature of the charge against him. He further averred that the order of the trial court is contrary to theconstitution and is, thus, null and void. He insists that he should not be compelled to undergo the rigors andtribulations of a protracted trial and incur expenses to defend himself against a non-existent charge.

Petitioner is correct.

An information or complaint must state explicitly and directly every act or omission constituting an offense38 andmust allege facts establishing conduct that a penal statute makes criminal;39 and describes the property which is thesubject of theft to advise the accused with reasonable certainty of the accusation he is called upon to meet at thetrial and to enable him to rely on the judgment thereunder of a subsequent prosecution for the same offense.40 Itmust show, on its face, that if the alleged facts are true, an offense has been committed. The rule is rooted on theconstitutional right of the accused to be informed of the nature of the crime or cause of the accusation against him.He cannot be convicted of an offense even if proven unless it is alleged or necessarily included in the Informationfiled against him.

As a general prerequisite, a motion to quash on the ground that the Information does not constitute the offensecharged, or any offense for that matter, should be resolved on the basis of said allegations whose truth and veracityare hypothetically committed;41 and on additional facts admitted or not denied by the prosecution.42 If the factsalleged in the Information do not constitute an offense, the complaint or information should be quashed by thecourt.43

We have reviewed the Amended Information and find that, as mentioned by the petitioner, it does not containmaterial allegations charging the petitioner of theft of personal property under Article 308 of the Revised PenalCode. It, thus, behooved the trial court to quash the Amended Information. The Order of the trial court denying themotion of the petitioner to quash the Amended Information is a patent nullity.

On the second issue, we find and so hold that the international telephone calls placed by Bay Super Orient Cardholders, the telecommunication services provided by PLDT and its business of providing said services are notpersonal properties under Article 308 of the Revised Penal Code. The construction by the respondents of Article 308of the said Code to include, within its coverage, the aforesaid international telephone calls, telecommunicationservices and business is contrary to the letter and intent of the law.

The rule is that, penal laws are to be construed strictly. Such rule is founded on the tenderness of the law for therights of individuals and on the plain principle that the power of punishment is vested in Congress, not in the judicialdepartment. It is Congress, not the Court, which is to define a crime, and ordain its punishment.44 Due respect forthe prerogative of Congress in defining crimes/felonies constrains the Court to refrain from a broad interpretation ofpenal laws where a "narrow interpretation" is appropriate. The Court must take heed to language, legislative historyand purpose, in order to strictly determine the wrath and breath of the conduct the law forbids.45 However, when thecongressional purpose is unclear, the court must apply the rule of lenity, that is, ambiguity concerning the ambit ofcriminal statutes should be resolved in favor of lenity.46

Penal statutes may not be enlarged by implication or intent beyond the fair meaning of the language used; and maynot be held to include offenses other than those which are clearly described, notwithstanding that the Court maythink that Congress should have made them more comprehensive.47 Words and phrases in a statute are to beconstrued according to their common meaning and accepted usage.

As Chief Justice John Marshall declared, "it would be dangerous, indeed, to carry the principle that a case which iswithin the reason or














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mischief of a statute is within its provision, so far as to punish a crime not enumerated in the statute because it is ofequal atrocity, or of kindred character with those which are enumerated.48 When interpreting a criminal statute thatdoes not explicitly reach the conduct in question, the Court should not base an expansive reading on inferencesfrom subjective and variable understanding.49

Article 308 of the Revised Penal Code defines theft as follows:

Art. 308. Who are liable for theft.– Theft is committed by any person who, with intent to gain but without violence,against or intimidation of persons nor force upon things, shall take personal property of another without the latter’sconsent.

The provision was taken from Article 530 of the Spanish Penal Code which reads:

1. Los que con ánimo de lucrarse, y sin violencia o intimidación en las personas ni fuerza en las cosas, toman lascosas muebles ajenas sin la voluntad de su dueño.50

For one to be guilty of theft, the accused must have an intent to steal (animus furandi) personal property, meaningthe intent to deprive another of his ownership/lawful possession of personal property which intent is apart from andconcurrently with the general criminal intent which is an essential element of a felony of dolo (dolus malus).

An information or complaint for simple theft must allege the following elements: (a) the taking of personal property;(b) the said property belongs to another; (c) the taking be done with intent to gain; and (d) the taking beaccomplished without the use of violence or intimidation of person/s or force upon things.51

One is apt to conclude that "personal property" standing alone, covers both tangible and intangible properties andare subject of theft under the Revised Penal Code. But the words "Personal property" under the Revised PenalCode must be considered in tandem with the word "take" in the law. The statutory definition of "taking" and movableproperty indicates that, clearly, not all personal properties may be the proper subjects of theft. The general rule isthat, only movable properties which have physical or material existence and susceptible of occupation by anotherare proper objects of theft.52 As explained by Cuelo Callon: "Cosa juridicamente es toda sustancia corporal,material, susceptible de ser aprehendida que tenga un valor cualquiera."53

According to Cuello Callon, in the context of the Penal Code, only those movable properties which can be taken andcarried from the place they are found are proper subjects of theft. Intangible properties such as rights and ideas arenot subject of theft because the same cannot be "taken" from the place it is found and is occupied or appropriated.

Solamente las cosas muebles y corporales pueden ser objeto de hurto. La sustracción de cosas inmuebles y lacosas incorporales (v. gr., los derechos, las ideas) no puede integrar este delito, pues no es posible asirlas,tomarlas, para conseguir su apropiación. El Codigo emplea la expresión "cosas mueble" en el sentido de cosa quees susceptible de ser llevada del lugar donde se encuentra, como dinero, joyas, ropas, etcétera, asi que suconcepto no coincide por completo con el formulado por el Codigo civil (arts. 335 y 336).54

Thus, movable properties under Article 308 of the Revised Penal Code should be distinguished from the rights orinterests to which they relate. A naked right existing merely in contemplation of law, although it may be very valuableto the person who is entitled to exercise it, is not the subject of theft or larceny.55 Such rights or interests areintangible and cannot be "taken" by another. Thus, right to produce oil, good will or an interest in business, or theright to engage in business, credit or franchise are properties. So is the credit line represented by a credit card.However, they are not proper subjects of theft or larceny because they are without form or substance, the mere"breath" of the Congress. On the other hand, goods, wares and merchandise of businessmen and credit cardsissued to them are movable properties with physical and material existence and may be taken by another; hence,proper subjects of theft.

There is "taking" of personal property, and theft is consummated when the offender unlawfully acquires possessionof personal property even if for a short time; or if such property is under the dominion and control of the thief. Thetaker, at some particular amount, must have obtained complete and absolute possession and control of the propertyadverse to the rights of the owner or the lawful possessor thereof.56 It is not necessary that the property be actuallycarried away out of the physical possession of the lawful possessor or that he should have made his escape withit.57 Neither asportation nor actual manual possession of property is required. Constructive possession of the thief ofthe property is enough.58

The essence of the element is the taking of a thing out of the possession of the owner without his privity andconsent and without animus revertendi.59

Taking may be by the offender’s own hands, by his use of innocent persons without any felonious intent, as well asany mechanical device, such as an access device or card, or any agency, animate or inanimate, with intent to gain.Intent to gain includes the unlawful taking of personal property for the purpose of deriving utility, satisfaction,enjoyment and pleasure.60

We agree with the contention of the respondents that intangible properties such as electrical energy and gas areproper subjects of theft. The reason for this is that, as explained by this Court in United States v. Carlos61 andUnited States v. Tambunting,62 based on decisions of the Supreme Court of Spain and of the courts in England and
















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the United States of America, gas or electricity are capable of appropriation by another other than the owner. Gasand electrical energy may be taken, carried away and appropriated. In People v. Menagas,63 the Illinois StateSupreme Court declared that electricity, like gas, may be seen and felt. Electricity, the same as gas, is a valuablearticle of merchandise, bought and sold like other personal property and is capable of appropriation by another. It isa valuable article of merchandise, bought and sold like other personal property, susceptible of being severed from amass or larger quantity and of being transported from place to place. Electrical energy may, likewise, be taken andcarried away. It is a valuable commodity, bought and sold like other personal property. It may be transported fromplace to place. There is nothing in the nature of gas used for illuminating purposes which renders it incapable ofbeing feloniously taken and carried away.

In People ex rel Brush Electric Illuminating Co. v. Wemple,64 the Court of Appeals of New York held that electricenergy is manufactured and sold in determinate quantities at a fixed price, precisely as are coal, kerosene oil, andgas. It may be conveyed to the premises of the consumer, stored in cells of different capacity known as anaccumulator; or it may be sent through a wire, just as gas or oil may be transported either in a close tank or forcedthrough a pipe. Having reached the premises of the consumer, it may be used in any way he may desire, being, likeilluminating gas, capable of being transformed either into heat, light, or power, at the option of the purchaser. InWoods v. People,65 the Supreme Court of Illinois declared that there is nothing in the nature of gas used forilluminating purposes which renders it incapable of being feloniously taken and carried away. It is a valuable articleof merchandise, bought and sold like other personal property, susceptible of being severed from a mass or largerquantity and of being transported from place to place.

Gas and electrical energy should not be equated with business or services provided by business entrepreneurs tothe public. Business does not have an exact definition. Business is referred as that which occupies the time,attention and labor of men for the purpose of livelihood or profit. It embraces everything that which a person can beemployed.66 Business may also mean employment, occupation or profession. Business is also defined as acommercial activity for gain benefit or advantage.67 Business, like services in business, although are properties, arenot proper subjects of theft under the Revised Penal Code because the same cannot be "taken" or "occupied." If itwere otherwise, as claimed by the respondents, there would be no juridical difference between the taking of thebusiness of a person or the services provided by him for gain, vis-à-vis, the taking of goods, wares or merchandise,or equipment comprising his business.68 If it was its intention to include "business" as personal property underArticle 308 of the Revised Penal Code, the Philippine Legislature should have spoken in language that is clear anddefinite: that business is personal property under Article 308 of the Revised Penal Code.69

We agree with the contention of the petitioner that, as gleaned from the material averments of the AmendedInformation, he is charged of "stealing the international long distance calls belonging to PLDT" and the use thereof,through the ISR. Contrary to the claims of the OSG and respondent PLDT, the petitioner is not charged of stealingP20,370,651.95 from said respondent. Said amount of P20,370,651.95 alleged in the Amended Information is theaggregate amount of access, transmission or termination charges which the PLDT expected from the internationallong distance calls of the callers with the use of Baynet Super Orient Cards sold by Baynet Co. Ltd.

In defining theft, under Article 308 of the Revised Penal Code, as the taking of personal property without the consentof the owner thereof, the Philippine legislature could not have contemplated the human voice which is converted intoelectronic impulses or electrical current which are transmitted to the party called through the PSTN of respondentPLDT and the ISR of Baynet Card Ltd. within its coverage. When the Revised Penal Code was approved, onDecember 8, 1930, international telephone calls and the transmission and routing of electronic voice signals orimpulses emanating from said calls, through the PSTN, IPL and ISR, were still non-existent. Case law is that, wherea legislative history fails to evidence congressional awareness of the scope of the statute claimed by therespondents, a narrow interpretation of the law is more consistent with the usual approach to the construction of thestatute. Penal responsibility cannot be extended beyond the fair scope of the statutory mandate.70

Respondent PLDT does not acquire possession, much less, ownership of the voices of the telephone callers or ofthe electronic voice signals or current emanating from said calls. The human voice and the electronic voice signalsor current caused thereby are intangible and not susceptible of possession, occupation or appropriation by therespondent PLDT or even the petitioner, for that matter. PLDT merely transmits the electronic voice signals throughits facilities and equipment. Baynet Card Ltd., through its operator, merely intercepts, reroutes the calls and passesthem to its toll center. Indeed, the parties called receive the telephone calls from Japan.

In this modern age of technology, telecommunications systems have become so tightly merged with computersystems that it is difficult to know where one starts and the other finishes. The telephone set is highly computerizedand allows computers to communicate across long distances.71 The instrumentality at issue in this case is notmerely a telephone but a telephone inexplicably linked to a computerized communications system with the use ofBaynet Cards sold by the Baynet Card Ltd. The corporation uses computers, modems and software, among others,for its ISR.72

The conduct complained of by respondent PLDT is reminiscent of "phreaking" (a slang term for the action of makinga telephone system to do something that it normally should not allow by "making the phone company bend over andgrab its ankles"). A "phreaker" is one who engages in the act of manipulating phones and illegally markets telephoneservices.73 Unless the phone company replaces all its hardware, phreaking would be impossible to stop. The phonecompanies in North America were impelled to replace all their hardware and adopted full digital switching systemknown as the Common Channel Inter Office Signaling. Phreaking occurred only during the 1960’s and 1970’s,decades after the Revised Penal Code took effect.












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The petitioner is not charged, under the Amended Information, for theft of telecommunication or telephone servicesoffered by PLDT. Even if he is, the term "personal property" under Article 308 of the Revised Penal Code cannot beinterpreted beyond its seams so as to include "telecommunication or telephone services" or computer services forthat matter. The word "service" has a variety of meanings dependent upon the context, or the sense in which it isused; and, in some instances, it may include a sale. For instance, the sale of food by restaurants is usually referredto as "service," although an actual sale is involved.74 It may also mean the duty or labor to be rendered by oneperson to another; performance of labor for the benefit of another.75 In the case of PLDT, it is to render local andinternational telecommunications services and such other services as authorized by the CPCA issued by the NTC.Even at common law, neither time nor services may be taken and occupied or appropriated.76 A service is generallynot considered property and a theft of service would not, therefore, constitute theft since there can be no caption orasportation.77 Neither is the unauthorized use of the equipment and facilities of PLDT by the petitioner theft underthe aforequoted provision of the Revised Penal Code.78

If it was the intent of the Philippine Legislature, in 1930, to include services to be the subject of theft, it should haveincorporated the same in Article 308 of the Revised Penal Code. The Legislature did not. In fact, the Revised PenalCode does not even contain a definition of services.

If taking of telecommunication services or the business of a person, is to be proscribed, it must be by specialstatute79 or an amendment of the Revised Penal Code. Several states in the United States, such as New York, NewJersey, California and Virginia, realized that their criminal statutes did not contain any provisions penalizing the theftof services and passed laws defining and penalizing theft of telephone and computer services. The PennsylvaniaCriminal Statute now penalizes theft of services, thus:

(a) Acquisition of services. --

(1) A person is guilty of theft if he intentionally obtains services for himself or for another which he knows areavailable only for compensation, by deception or threat, by altering or tampering with the public utility meter ormeasuring device by which such services are delivered or by causing or permitting such altering or tampering, bymaking or maintaining any unauthorized connection, whether physically, electrically or inductively, to a distribution ortransmission line, by attaching or maintaining the attachment of any unauthorized device to any cable, wire or othercomponent of an electric, telephone or cable television system or to a television receiving set connected to a cabletelevision system, by making or maintaining any unauthorized modification or alteration to any device installed by acable television system, or by false token or other trick or artifice to avoid payment for the service.

In the State of Illinois in the United States of America, theft of labor or services or use of property is penalized:

(a) A person commits theft when he obtains the temporary use of property, labor or services of another which areavailable only for hire, by means of threat or deception or knowing that such use is without the consent of the personproviding the property, labor or services.

In 1980, the drafters of the Model Penal Code in the United States of America arrived at the conclusion that laborand services, including professional services, have not been included within the traditional scope of the term"property" in ordinary theft statutes. Hence, they decided to incorporate in the Code Section 223.7, which definesand penalizes theft of services, thus:

(1) A person is guilty of theft if he purposely obtains services which he knows are available only for compensation,by deception or threat, or by false token or other means to avoid payment for the service. "Services" include labor,professional service, transportation, telephone or other public service, accommodation in hotels, restaurants orelsewhere, admission to exhibitions, use of vehicles or other movable property. Where compensation for service isordinarily paid immediately upon the rendering of such service, as in the case of hotels and restaurants, refusal topay or absconding without payment or offer to pay gives rise to a presumption that the service was obtained bydeception as to intention to pay; (2) A person commits theft if, having control over the disposition of services ofothers, to which he is not entitled, he knowingly diverts such services to his own benefit or to the benefit of anothernot entitled thereto.

Interestingly, after the State Supreme Court of Virginia promulgated its decision in Lund v. Commonwealth,80

declaring that neither time nor services may be taken and carried away and are not proper subjects of larceny, theGeneral Assembly of Virginia enacted Code No. 18-2-98 which reads:

Computer time or services or data processing services or information or data stored in connection therewith ishereby defined to be property which may be the subject of larceny under § § 18.2-95 or 18.2-96, or embezzlementunder § 18.2-111, or false pretenses under § 18.2-178.

In the State of Alabama, Section 13A-8-10(a)(1) of the Penal Code of Alabama of 1975 penalizes theft of services:

"A person commits the crime of theft of services if: (a) He intentionally obtains services known by him to be availableonly for compensation by deception, threat, false token or other means to avoid payment for the services …"

In the Philippines, Congress has not amended the Revised Penal Code to include theft of services or theft ofbusiness as felonies. Instead, it approved a law, Republic Act No. 8484, otherwise known as the Access DevicesRegulation Act of 1998, on February 11, 1998. Under the law, an access device means any card, plate, code,account number, electronic serial number, personal identification number and other telecommunication services,








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equipment or instrumentalities-identifier or other means of account access that can be used to obtain money, goods,services or any other thing of value or to initiate a transfer of funds other than a transfer originated solely by paperinstrument. Among the prohibited acts enumerated in Section 9 of the law are the acts of obtaining money oranything of value through the use of an access device, with intent to defraud or intent to gain and fleeing thereafter;and of effecting transactions with one or more access devices issued to another person or persons to receivepayment or any other thing of value. Under Section 11 of the law, conspiracy to commit access devices fraud is acrime. However, the petitioner is not charged of violation of R.A. 8484.

Significantly, a prosecution under the law shall be without prejudice to any liability for violation of any provisions ofthe Revised Penal Code inclusive of theft under Rule 308 of the Revised Penal Code and estafa under Article 315 ofthe Revised Penal Code. Thus, if an individual steals a credit card and uses the same to obtain services, he is liableof the following: theft of the credit card under Article 308 of the Revised Penal Code; violation of Republic Act No.8484; and estafa under Article 315(2)(a) of the Revised Penal Code with the service provider as the privatecomplainant. The petitioner is not charged of estafa before the RTC in the Amended Information.

Section 33 of Republic Act No. 8792, Electronic Commerce Act of 2000 provides:

Sec. 33. Penalties.— The following Acts shall be penalized by fine and/or imprisonment, as follows:

a) Hacking or cracking which refers to unauthorized access into or interference in a computer system/server orinformation and communication system; or any access in order to corrupt, alter, steal, or destroy using a computeror other similar information and communication devices, without the knowledge and consent of the owner of thecomputer or information and communications system, including the introduction of computer viruses and the like,resulting on the corruption, destruction, alteration, theft or loss of electronic data messages or electronic documentsshall be punished by a minimum fine of One hundred thousand pesos (P100,000.00) and a maximumcommensurate to the damage incurred and a mandatory imprisonment of six (6) months to three (3) years.

IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The assailed Orders of the Regional Trial Courtand the Decision of the Court of Appeals are REVERSED and SET ASIDE. The Regional Trial Court is directed toissue an order granting the motion of the petitioner to quash the Amended Information.

SO ORDERED.

ROMEO J. CALLEJO, SR.Associate Justice

WE CONCUR:

(No part)ARTEMIO V. PANGANIBAN

Chief JusticeChairperson

CONSUELO YNARES-SANTIAGO,Associate Justice

MA. ALICIA AUSTRIA-MARTINEZAssociate Justice

(On leave)MINITA V. CHICO-NAZARIO*

Associate Justice

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the abovedecision were reached in consultation before the case was assigned to the writer of the opinion of the Court’sDivision.

ARTEMIO V. PANGANIBANChief Justice

Footnotes

* On leave.

1 Penned by Associate Justice Bienvenido L. Reyes, with Associate Justices Roberto A. Barrios and EdgardoF. Sundiam, concurring.

2 an act further amending act no. 3436, as amended, "xxx consolidating the terms and conditions of thefranchise granted to [pldt], and extending the said franchise by twenty-five (25) years from the expirationthereof xxx."

3 Rollo, pp. 129-130.

4 Id. at 131.

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5 Id. at 131, 137.

6 Id.

7 Id. at 138.

8 Id. at 134.

9 Id. at 140.

10 Id. at 142-146.

11 Rollo, pp. 243-246.

12 NOW, THEREFORE, I FERDINAND E. MARCOS, President of the Philippines, by virtue of the powersvested in me by the Constitution a Commander-in-Chief of all the Armed Forces of the Philippines, andpursuant to Proclamation No. 1081 dated September 21, 1972, and General Order No. 1 dated September22, 1972, as amended, do hereby order and decree that any person who installs any water, electrical ortelephone connection without previous authority from the Metropolitan Waterworks and Sewerage System,the Manila Electric Company or the Philippine Long Distance Telephone Company, as the case may be;tampers and/or uses tampered water or electrical meters or jumpers or other devices whereby water orelectricity is stolen; steals or pilfers water and/or electric meters or water, electric and/or telephone wires;knowingly possesses stolen or pilfered water and/or electrical meters as well as stolen or pilfered water,electrical and/or telephone wires, shall, upon conviction, be punished by prision correccional in its minimumperiod or a fine ranging from two thousand to six thousand pesos, or both. If the violation is committed withthe connivance or permission of an employee or officer of the Metropolitan Waterworks and SewerageSystem, or the Manila Electric Company, or the Philippine Long Distance Telephone Company, suchemployee or officer shall, upon conviction, be punished by a penalty one degree lower than prisioncorreccional in its minimum period and forthwith be dismissed and perpetually disqualified from employmentin any public or private utility or service company.

13 Rollo, pp. 57-58. (Underscoring supplied)

14 Id. at 67-76.

15 Id. at 69. (Emphasis supplied)

16 Id. at 77-80.

17 Id. at 81-86.

18 31 Phil. 494 (1915).

19 Rollo, pp. 87-94.

20 44 Phil. 933, 935 (1922).

21 CA rollo, p. 6.

22 Id. at 9-11.

23 Id.

24 Id.

25 Resolution No. 149, Series of 1999 dated April 16, 1999 (I.S. No. 96-3884), rollo, pp. 95-97.

26 Id.

27 Id. at 32-47.

28 21 Phil. 553 (1911).

29 Supra note 20, at 935.

30 Rollo, pp. 18-19.

31 Id. at 689.

32 Id. at 691.





























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33 Id. at 669-670.

34 Rollo, p. 670.

35 Madarang v. Court of Appeals, G.R. No. 143044, July 14, 2005, 463 SCRA 318, 327 (2005).

36 G.R. No. 148156, September 27, 2004, 439 SCRA 202 (2000).

37 Id. at 211.

38 Section 9, Rule 110 of the Revised Rules of Criminal Procedure.

39 People v. Weg, 450 N.Y.S.2d 957 (1982).

40 Clines v. Commonwealth, 298 S.W. 1107 (1927).

41 Santiago v. Garchitorena, G.R. No. 109266, December 2, 1993, 228 SCRA 214.

42 Garcia v. Court of Appeals, 334 Phil. 621, 634 (1997); People v. Navarro, 75 Phil. 516, 518 (1945).

43 Section 3(a), Rule 117 of the 2000 Rules of Criminal Procedure.

44 United States v. Wiltberger, 18 U.S. 76 (1820).

45 Dowling v. United States, 473 U.S. 207 (1985).

46 Liparota v. United States, 105 S. Ct. 2084 (1985).

47 Kelley v. State, 119 N.E.2d 322 (1954); State v. McGraw, 480 N.E.2d 552 (1985).

48 United States v. Wiltberger, supra note 44.

49 Dowling v. United States, supra note 45.

50 Viada, codigo penal reformado de 1870, concordado y comentado, 219.

The felony has the following elements:

(1) Apoderamiento de una cosa mueble; (2) Que la cosa mueble sea ajena; (3) Que el apoderamientose verifique con intención de lucro; (4) Que se tome la cosa sin la voluntad de su dueño; (5) Que serealice el apoderamiento de la cosa sin violencia intimidación en las personas ni fuerza en las cosas(Viada, 220-221).

51 People v. Sison, 379 Phil. 363, 384 (2000); People v. Bustinera, G.R. No. 148233, June 8, 2004, 431SCRA 284, 291.

52 Cuello Callon, Derecho Penal, Tomo II, p. 724.

53 Id.

54 See note 52, p. 725. (Underscoring supplied)

55 36 C.J.S. 737.

56 People v. Ashworth, 222 N.Y.S. 24 (1927).

57 People v. Salvilla, G.R. No. 86163, April 26, 1990, 184 SCRA 671, 677 (1990).

58 Harris v. State, 14 S.W. 390 (1890).

59 Woods v. People, 78 N.E. 607 (1906).

60 Villacorta v. Insurance Commission, G.R. No. 54171, October 28, 1980, 100 SCRA 467.

61 Supra note 28.

62 41 Phil. 364 (1921).

63 11 N.E.2d 403 (1937).
































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64 29 N.E. 808 (1892). (Emphasis supplied)

65 Supra note 59 (Emphasis supplied)

66 Doggett v. Burnet, 65 F.2d 191 (1933).

67 Black’s Law Dictionary, 5th ed., p. 179; Union League Club v. Johnson, 108 P.2d 487, 490 (1940).

68 United States v. McCraken, 19 C.M.R. 876 (1955).

69 People v. Tansey, 593 N.Y.S. 2d 426 (1992).

70 People v. Case, 42 N.Y.S. 2d 101.

71 Commonwealth v. Gerulis, 616 A.2d 686 (1992).

72 Rollo, p. 138.

73 Commonwealth v. Gerulis, supra note 71.

74 Central Power and Light Co. v. State, 165 S.W. 2d 920 (1942).

75 Black’s Law Dictionary, p. 1227.

76 Lund v. Commonwealth, 232 S.E.2d 745 (1977); 50 Am. Jur. 2d Larceny, p. 83.

77 Imbau, Thomson, Moenssens, Criminal Law, Second Edition, p. 6247, 2 Wharton Criminal Law, Prodded ,§ 604:369.

78 Id. at 746; Commonwealth v. Rivera, 583 N.E.2d 867 (1991).

79 People v. Tansey, supra note 69.

80 See note 76.

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