If you have ever issued a post-dated check or accepted one as payment a recent decision of the Supreme Court En Banc should be on your radar.
In Spouses Arnel Carlos and Marivic Carlos v. People of the Philippines and Tire Star, Inc. (G.R. No. 277047, promulgated April 15, 2026), the Supreme Court not only affirmed the conviction of a married couple for six counts of violation of Batas Pambansa Blg. 22 (the Anti-Bouncing Check Law), it also took the opportunity to clarify and standardize the rules on how the "notice of dishonor" must be served — closing a loophole that accused check issuers have long used to escape liability.
Here is what happened, what the Court decided, and what it means for you or your business.
The Story Behind the Case
In March 2014, the spouses Carlos purchased car tires on installment from Tire Star, Inc., a tire trading company in Pasig City. To pay for their orders, they issued six post-dated checks drawn against Eastwest Bank, in these amounts:
Check AmountCheck DatePHP 91,000.00April 5, 2014PHP 83,000.00March 6, 2014PHP 10,600.00June 7, 2014PHP 171,600.00June 7, 2014PHP 60,000.00March 15, 2014PHP 193,772.58March 15, 2014
Total: PHP 609,972.58
When Tire Star deposited the checks, every single one bounced. The reason stamped by the bank: "Account Closed."
Tire Star's representative called the spouses to demand payment. When that failed, the company's lawyer prepared a formal demand letter containing the notice of dishonor, which Tire Star's messenger personally brought to the spouses' store on June 8, 2016. According to the prosecution, the spouses refused to receive the letter and instead instructed their employee, Edrick, to receive and sign for it on their behalf.
The spouses were charged with six counts of violation of B.P. 22 before the Metropolitan Trial Court (MeTC) of Pasig City.
The Defense
The spouses claimed they were long-time, good-paying customers of Tire Star; that they never personally went to Tire Star's office; that their former accounting staff handled the checks; that they never received any notice of dishonor; and that they had already paid around PHP 300,000.00 — although the vouchers supposedly proving payment were "lost" when their office was padlocked by the Quezon City Business Permit and License Office.
What the Lower Courts Ruled
MeTC (January 31, 2019): Guilty on all six counts. The spouses were sentenced to pay fines equal to the face value of each check (with subsidiary imprisonment if unable to pay) and to indemnify Tire Star PHP 609,972.58 plus legal interest.
RTC (November 16, 2020): Affirmed the conviction, but modified the interest — 6% per annum on the principal counted from June 8, 2016 (the date of extrajudicial demand), plus interest on that interest from August 22, 2016 (the date the criminal Informations were filed).
Court of Appeals (May 29, 2024): Denied the spouses' petition and sustained the conviction.
Undeterred, the spouses elevated the case to the Supreme Court, arguing mainly that the prosecution failed to prove they actually received the notice of dishonor.
The Supreme Court's Ruling
The Supreme Court denied the petition and found the spouses guilty beyond reasonable doubt of six counts of violation of B.P. 22.
A Quick Refresher: The 3 Elements of a B.P. 22 Violation
To convict a person under B.P. 22, the prosecution must prove:
The making, drawing, and issuance of a check to apply on account or for value;
Knowledge by the issuer that, at the time of issue, they did not have sufficient funds or credit with the bank to cover the check; and
The subsequent dishonor of the check by the bank for insufficiency of funds or credit (or dishonor for the same reason had the drawer not ordered a stop payment without valid cause).
In this case, the first and third elements were undisputed — the spouses signed and issued the checks, and the checks bounced due to a closed account.
The battle was over the second element: knowledge of insufficient funds. Because knowledge is a state of mind that is hard to prove, Section 2 of B.P. 22 creates a presumption of such knowledge — but the presumption only arises if the issuer received a notice of dishonor and still failed to pay or arrange payment within five (5) banking days.
This is why the notice of dishonor is the make-or-break issue in most B.P. 22 cases — and why so many accused simply deny ever receiving it.
"We Never Received the Notice" Is a Weak Defense
The Court held that the spouses' bare denial could not prevail over the affirmative testimony of Tire Star's messenger who personally served the demand letter, executed an Affidavit of Proof of Service, and testified that the spouses refused to receive the letter and made their employee sign for it instead.
The Court emphasized that denial is an "inherently weak" defense, and that allowing acquittals based on convenient denials of receipt would reduce B.P. 22 prosecutions "to a futile exercise, leaving their outcome entirely at the mercy of the accused."
Significantly, the Court added a demanding standard for the defense going forward: for a denial of receipt to prosper, the drawer must prove that it was physically impossible for them to have been at the place and time the notice was served. Absent clear and convincing proof of impossibility, a mere denial cannot overcome affirmative evidence of service.
New Standardized Rules for Serving the Notice of Dishonor
This is where the decision becomes a landmark. Recognizing that earlier rulings allowed acquittals based on alleged non-receipt of notice, the Court promulgated clear guidelines on how the notice of dishonor should be served in B.P. 22 cases, drawing analogies from ejectment and labor cases. In summary:
1. Personal Service (Primary Mode)
The notice is delivered directly to the drawer of the check.
If the drawer transacts through a company, service may be made at the company's office, to a clerk or the person in charge of receiving documents.
If no one is found at the office (or the office is unknown or nonexistent), the notice may be left at the drawer's residence (if known), between 8:00 a.m. and 6:00 p.m., with a person of sufficient age and discretion residing there.
The server must execute an affidavit under oath detailing the date, time, place, and manner of service — and the recipient's conduct when the notice was tendered.
Whenever feasible, the service should be documented with photographs and/or video recordings taken at the time of service, to be authenticated in court.
2. Registered Mail (If Personal Service Is Not Practicable)
The notice must be mailed in a sealed, properly addressed envelope with postage fully prepaid, with instructions to return the mail if undelivered after 10 days. If no registry service is available in the locality, ordinary mail may be used.
The server must execute an affidavit stating the mailing details, the reason personal service was not practicable, and attaching the registry receipt and return card.
Important: registry receipts and return cards do not, by themselves, prove receipt — the signature on the registry return must be positively identified as that of the drawer or their authorized representative.
3. Electronic Service (Email, Viber, Facebook Messenger, and Similar Channels)
In a modernizing move aligned with the Court's Strategic Plan for Judicial Innovations 2022–2027, the Court allowed service of the notice of dishonor by electronic means:
As a primary mode, if the check issuer made their email available to the payee in official communications; or
As a substituted mode, when personal service is not practicable — for example, when the drawer deliberately evades service, refuses receipt, or has an unauthorized person receive the notice.
For electronic service to be valid, the recipient's contact details (email, account, or number) must be known, reasonably verified, and shown to be attributable to and actively used by the drawer — for instance, through prior message exchanges about the same transaction, prior written confirmation of the contact details, or contact details appearing in check issuance records or contract documents.
When used as substituted service, the electronic message must attach the notice of dishonor, state the prior attempts at personal service, and be sent within 24 hours from the final attempt at personal service. An affidavit with supporting documentation (screenshots, delivery/read receipts, exported chat history where available) is required.
The Affidavit of Service Is Now Mandatory
Regardless of the mode used, the Court declared that an affidavit of service of the notice of dishonor is now mandatory. And critically: a drawer's mere denial of receipt — or claim of having ignored or overlooked the electronic message — will not invalidate service.
The Court also noted that a bank's own text or email notification of dishonor to the drawer may be presented as corroborating evidence, but it does not replace the required service of notice by the payee.
Worth remembering: under Section 1 of B.P. 22, the penalty for issuing a worthless check is imprisonment of 30 days to 1 year, or a fine of up to double the amount of the check (but not exceeding PHP 200,000.00 per check), or both, at the court's discretion.
Key Takeaways
If you issue checks:
B.P. 22 is malum prohibitum — the mere act of issuing a bouncing check is punishable, regardless of your intent or the purpose of the check.
Refusing to accept a demand letter will not save you. Evasion can now justify substituted electronic service, and your refusal will be documented in an affidavit (and possibly on video).
Once you receive a notice of dishonor, you have only five (5) banking days to pay or arrange payment. Use them.
If you claim you never received the notice, be prepared to prove it was physically impossible for you to have received it — a very high bar.
If you accept checks (businesses and creditors):
Your case will rise or fall on proof of service of the notice of dishonor. Follow the new guidelines strictly.
Always have your server execute a sworn affidavit of service, and where feasible, photograph or video the service.
Keep records of your customer's email addresses and messaging accounts used in your transactions — these can now support valid electronic service.
If mailing the notice, secure and authenticate the registry receipt and return card; the documents alone are not enough without identifying who signed.
Need Help With a Bounced Check Case?
Whether you are a business owner holding dishonored checks or a person facing a B.P. 22 complaint, the rules just changed — and strict compliance with the Supreme Court's new service requirements can make or break a case. Our firm assists clients in demand letter preparation, evidence-building compliant with the Carlos guidelines, criminal prosecution and defense, and settlement negotiations.
Contact us today for a consultation.
Disclaimer: This article is for general information only and does not constitute legal advice. Reading this article does not create a lawyer-client relationship. For advice on your specific situation, please consult a lawyer. Case reference: Spouses Arnel Carlos and Marivic Carlos v. People of the Philippines and Tire Star, Inc., G.R. No. 277047, April 15, 2026 (En Banc, per J. Gaerlan).