Professional Documents
Culture Documents
The best evidence rule likewise acts as an insurance against fraud. If PIATCO argues that its non-submission of original documents before
a party is in the possession of the best evidence and withholds it, the trial court is justified under Section 3 (c), Rule 130 of the Rules
and seeks to substitute inferior evidence in its place, the of Court. It points out that a party need not submit the original
presumption naturally arises that the better evidence is withheld for when it consists of numerous accounts or other documents which
fraudulent purposes that its production would expose and defeat. cannot be examined in court without great loss of time and the fact
The rule likewise protects against misleading inferences resulting sought to be established from them is only the general result of the
from the intentional or unintentional introduction of selected whole. PIATCO insists that the lower courts erred in not giving
portions of a larger set of writings.287cralawrednad probative value to the report prepared by Reyes Tacandong & Co.,
an auditing firm, validating PIATCO’s computation of attendant
As exceptions to the best evidence rule, Section 3, Rule 130 of the costs. Significantly, Reyes Tacandong & Co. failed to state that it
The RTC found for BF According to the RTC, ESHRIs refusal to pay BFs valid claims
constituted evident bad faith entitling BF to moral damages and
On September 23, 1996, the RTC, on the main finding that BF, as attorneys fees.
plaintiff a quo, is entitled to the payment of its claim covered by
Progress Billing Nos. 14 to 19 and to the retention money ESHRI subsequently moved for reconsideration, but the motion was
corresponding to Progress Billing Nos. 1 to 11, with interest in both denied by the RTC, prompting ESHRI to appeal to the CA in CA-G.R.
instances, rendered judgment for BF. The fallo of the RTC Decision CV No. 57399.
reads:
We agree with BF. The only actual rule that the term best evidence
denotes is the rule requiring that the original of a writing must, as a Secondary evidence of the contents of a written instrument or
general proposition, be produced[17] and secondary evidence of its document refers to evidence other than the original instrument or
contents is not admissible except where the original cannot be had. document itself.[18] A party may present secondary evidence of the
contents of a writing not only when the original is lost or destroyed,
In our view, the trial court correctly allowed the presentation of the Four factual premises are readily deducible from the above
photocopied documents in question as secondary evidence. Any exchanges, to wit: (1) the existence of the original documents which
suggestion that BF failed to lay the required basis for presenting the ESHRI had possession of; (2) a request was made on ESHRI to
photocopies of Progress Billing Nos. 14 to 19 instead of their produce the documents; (3) ESHRI was afforded sufficient time to
originals has to be dismissed. The stenographic notes of the produce them; and (4) ESHRI was not inclined to produce them.
following exchanges between Atty. Andres and Atty. Autea, counsel
for BF and ESHRI, respectively, reveal that BF had complied with the Clearly, the circumstances obtaining in this case fall under the
requirements: exception under Sec. 3(b) of Rule 130. In other words, the
conditions sine qua non for the presentation and reception of the
ATTY. ANDRES: photocopies of the original document as secondary evidence have
During the previous hearing of this case, your Honor, likewise, the been met. These are: (1) there is proof of the original documents
witness testified that certain exhibits namely, the Progress Payment execution or existence; (2) there is proof of the cause of the original
Certificates and the Progress Billings the originals of these documents unavailability; and (3) the offeror is in good faith.[19]
documents were transmitted to ESHRI, all the originals are in the While perhaps not on all fours because it involved a check, what the
possession of ESHRI since these are internal documents and I am Court said in Magdayao v. People, is very much apt, thus:
referring specifically to the Progress Payment Certificates. We
requested your Honor, that in order that plaintiff [BF] be allowed to
present secondary original, that opposing counsel first be given x x x To warrant the admissibility of secondary evidence when the
opportunity to present the originals which are in their possession. original of a writing is in the custody or control of the adverse party,
May we know if they have brought the originals and whether they Section 6 of Rule 130 provides that the adverse party must be given
will present the originals in court, Your Honor. (Emphasis added.) reasonable notice, that he fails or refuses to produce the same in
court and that the offeror offers satisfactory proof of its existence.
ATTY. AUTEA:
We have already informed our client about the situation, your xxxx
Honor, that it has been claimed by plaintiff that some of the
originals are in their possession and our client assured that, they will
On the strength of the aforequoted provision, the appellate court II. THE [CA] ERRED IN NOT RULING THAT AS FORMER
correctly dismissed ESHRIs claim for restitution of its garnished DIRECTOR, PETITIONER CANNOT BE HELD PERSONALLY LIABLE FOR
deposits, the executed appealed RTC Decision in Civil Case No. ANY ALLEGED BREACH OF A CONTRACT ENTERED INTO BY THE
63435 having in fact been upheld in toto. CORPORATION.
It is true that the Courts Decision of August 11, 1998 in G.R. No. III. THE [CA] ERRED IN NOT RULING THAT RESPONDENT IS
132655 recognized the validity of the issuance of the desired NOT ENTITLED TO AN AWARD OF MORAL DAMAGES.
restitution order. It bears to emphasize, however, that the CA had
since then decided CA-G.R. CV No. 57399, the main case, on the IV. THE [CA] ERRED IN HOLDING PETITIONER PERSONALLY
merits when it affirmed the underlying RTC Decision in Civil Case LIABLE TO RESPONDENT FOR EXEMPLARY DAMAGES.
No. 63435. This CA Decision on the original and main case
effectively rendered our decision on the incidental procedural V. THE [CA] ERRED IN NOT RULING THAT RESPONDENT IS
matter on restitution moot and academic. Allowing restitution at NOT ENTITLED TO ANY AWARD OF ATTORNEYS FEES.[22]
this point would not serve any purpose, but only prolong an already
protracted litigation.
First off, Roxas-del Castillo submits that the RTC decision in question
G.R. No. 145873 violated the requirements of due process and of Sec. 14, Article VII
Petitioner Roxas-del Castillo, in her separate petition, excepts from of the Constitution that states, No decision shall be rendered by any
the CA Decision affirming, in its entirety, the RTC Decision holding court without expressing therein clearly and distinctly the facts and
her, with the other individual petitioners in G.R. No. 145842, who the law on which it is based.
were members of the Board of Directors of ESHRI, jointly and
severally liable with ESHRI for the judgment award. She presently Roxas-del Castillos threshold posture is correct. Indeed, the RTC
contends: decision in question, as couched, does not provide the factual or
legal basis for holding her personally liable under the premises. In
I. THE [CA] ERRED IN NOT DECLARING THAT THE fact, only in the dispositive portion of the decision did her solidary
DECISION OF THE TRIAL COURT ADJUDGING PETITIONER liability crop up. And save for her inclusion as party defendant in the
The above conclusion would still hold even if petitioner Roxas-del Article 1311. Contracts take effect only between the parties, their
Castillo, at the time ESHRI defaulted in paying BFs monthly progress assigns and heirs, except in cases where the rights and obligations
bill, was still a director, for, before she could be held personally are not transmissible by their nature, or by stipulation or by
liable as corporate director, it must be shown that she acted in a provision of law.
manner and under the circumstances contemplated in Sec. 31 of the
Corporation Code, which reads:
This is a Petition for Review on Certiorari from the Decision[1] of the In May 1988, petitioner Concepcion Chua Gaw and her husband,
Court of Appeals (CA) in CA-G.R. CV No. 66790 and Resolution[2] Antonio Gaw, asked respondent, Suy Ben Chua, to lend them
Failing to heed his demand, respondent filed a Complaint for Sum of With leave of court, the spouses Gaw filed an Answer (with
Money against the spouses Gaw with the RTC. The complaint Amended Compulsory Counterclaim) wherein they insisted that
alleged that on June 7, 1988, he extended a loan to the spouses petitioner, as one of the compulsory heirs, is entitled to one-sixth
Gaw for P200,000.00, payable within six months without interest, (1/6) of Hagonoy Lumber, which the respondent has arrogated to
but despite several demands, the couple failed to pay their himself. They claimed that, despite repeated demands, respondent
obligation.[11] has failed and refused to account for the operations of Hagonoy
Lumber and to deliver her share therein. They then prayed that
In their Answer (with Compulsory Counterclaim), the spouses Gaw respondent make an accounting of the operations of Hagonoy
contended that the P200,000.00 was not a loan but petitioners Lumber and to deliver to petitioner her one-sixth (1/6) share
share in the profits of Hagonoy Lumber, one of her familys thereof, which was estimated to be worth not less than
businesses. According to the spouses, when they transferred P500,000.00.[14]
residence to Marilao, Bulacan, petitioner asked respondent for an
The RTC held that respondent is entitled to the payment of the Aggrieved, petitioner appealed to the CA, alleging that the trial
amount of P200,000.00 with interest. It noted that respondent court erred (1) when it considered the amount of P200,000.00 as a
personally issued Check No. 240810 to petitioner and her husband loan obligation and not Concepcions share in the profits of Hagonoy
upon their request to lend them the aforesaid amount. The trial Lumber; (2) when it considered as evidence for the defendant,
court concluded that the P200,000.00 was a loan advanced by the plaintiffs testimony when he was called to testify as an adverse
respondent from his own funds and not remunerations for services party under Section 10 (e), Rule 132 of the Rules of Court; and (3)
rendered to Hagonoy Lumber nor petitioners advance share in the when it considered admissible mere copies of the Deed of Partition
profits of their parents businesses. and Deed of Sale to prove that respondent is now the owner of
Hagonoy Lumber.[24]
The trial court further held that the validity and due execution of
the Deed of Partition and the Deed of Sale, evidencing transfer of On May 23, 2003, the CA affirmed the Decision of the RTC. [25] The
ownership of Hagonoy Lumber from Chua Sioc Huan to respondent, appellate court found baseless the petitioners argument that the
was never impugned. Although respondent failed to produce the RTC should not have included respondents testimony as part of
originals of the documents, petitioner judicially admitted the due petitioners evidence. The CA noted that the petitioner went on a
execution of the Deed of Partition, and even acknowledged her fishing expedition, the taking of respondents testimony having
Accordingly, we find that the best evidence rule is not applicable to SO ORDERED.
the instant case. Here, there was no dispute as to the terms of EBREO v EBREO
either deed; hence, the RTC correctly admitted in evidence mere DECISION
copies of the two deeds. The petitioner never even denied their due
execution and admitted that she signed the Deed of Partition.[50]
As for the Deed of Sale, petitioner had, in effect, admitted its CHICO-NAZARIO, J.:
genuineness and due execution when she failed to specifically deny
it in the manner required by the rules.[51] The petitioner merely
claimed that said documents do not express the true agreement Does an annotation in a tax declaration of an alleged Deed of Sale
and intention of the parties since they were only provisional paper sufficiently prove conveyance of title to a property? This is the issue
arrangements made upon the advice of counsel.[52] Apparently, the presented to Us in the present petition.
petitioner does not contest the contents of these deeds but alleges
that there was a contemporaneous agreement that the transfer of The factual antecedents of this case are narrated herein:
Hagonoy Lumber to Chua Sioc Huan was only temporary.
A Complaint dated 04 January 1994, docketed as Civil Case No. 4132
An agreement or the contract between the parties is the formal for Partition, Reconveyance, Accounting and Damages, was filed by
expression of the parties rights, duties and obligations. It is the best Gil Ebreo, represented by his Attorney-in-Fact Felixberto Ebreo,
evidence of the intention of the parties.[53] The parties intention is Flaviano Ebreoand Homobono Cueto against petitioners Felino
to be deciphered from the language used in the contract, not from Ebreo, Spouses Antonio Ebreo and Evelyn P. Beraa-Ebreo, Ignacio
the unilateral post facto assertions of one of the parties, or of third Ebreo and Eleuteria Cueto before the Regional Trial Court (RTC) of
parties who are strangers to the contract.[54] Thus, when the terms Batangas City, Branch 7.
Felipe Ebreo left to his children an untitled parcel of land situated in Answering the complaint, the defendants countered that after the
Barangay Sampaga, Batangas City, more particularly described as execution of the Kasulatan ng Pagbabahagi ng Lupa, by and among
follows: the heirs of the late Felipe Ebreo, Lot 9046-F was sold by the heirs
to Santiago Puyo. By virtue of this sale, the corresponding Real
Isang palagay na lupang palayanin o linangin ipinamumuwis sa ilalim Property Tax Declaration was transferred in the name of Santiago
ng Tax Declaration No. 39949 S-1953, na ang mga karatig sa Ilaya ay Puyo as owner. However, the deed of sale evidencing this
Prudencia Coz, sa Silangan ay Pablo Cantro at Santiago Banaag, sa transaction was never presented.
ibaba ay Ilat (Creek) at sa Kanluranay Marcos at Fortunato Banaag As narrated by the defendants, Tax Declaration No. 39241,[5]
may luwang na 31,781 metros kuwadrados humigit kumulang at beginning in the year 1969 covering Lot 9046-F was under the
may balor amiliorada na halagang P950.00, lalong kilala sa Lote names of the heirs of Felipe Ebreo. Thereafter, upon the sale of the
9046 ng sukat katastro dito sa Batangas.[2] lot by the heirs of Felipe Ebreo to Santiago Puyo, Tax Declaration
No. 39241 was cancelled and a new one, Tax Declaration No.
48221[6] dated 15 January 1973, was issued in the name of Santiago
Pursuant to the subdivision made by their father Felipe, Lot No. Puyo. On this tax declaration, the alleged sale of Lot 9046-F by the
9046 was subdivided into six lots identified as Lots A, B, C, D, E and Heirs of Felipe Ebreo to Santiago Puyo was annotated. Soon, Tax
F.[3] Declaration No. 48221 was cancelled by Tax Declaration No. 4042[7]
for the year 1974, still in the name of Santiago Puyo. Upon the sale
On 11 September 1967, the five heirs of Felipe Ebreo, through by Santiago Puyo of Lot 9046- F to Antonio Ebreo on 23 July 1976,
themselves and their representatives, executed and signed a Tax Declaration No. 4042 was cancelled and a new one, Tax
document entitled, Kasulatan ng Pagbabahagi ng Lupa[4] where Declaration No. 50669,[8] for the year 1977, was issued in the name
Q You are also required by this Honorable Court to bring a copy of Q Do you have copy of that document which is the basis of the
the tax declaration No. 48221, do you have copy of the same? transfer?
A I have copy of that tax declaration, Sir. A We could not be located (sic) because as I have said earlier our
office was burned on May 23, 1979, Sir.
Q Will you please produce the same?
Witness is producing a copy of tax declaration No. 32941 in the Q So what does this phrase Deed of Sale, what do you mean by
name of Santiago Puyo. that?
A Can you explain how this tax declaration was placed in the name A I placed that, that is the title of the instrument used in the
of Santiago Puyo? transfer of this tax declaration, Sir.[19]
Q Previously this tax declaration was owned by Gil, Flaviano, Felino, It is worth noting that Antonio Pajilan, an employee of the City
Ignacio Ebreo and Genoveva, Eleuteria and Homobono Cueto under Assessors Office of Batangas City[20] who testified regarding Tax
PD 32941 this tax declaration is under 48221 in the name of Declaration No. 48221 dated 15 January 1973 on which was
Santiago Puyo and this was transferred by a virtue of Deed of Sale annotated the alleged sale between the heirs of Felipe Ebreo to
annotated in the tax declaration and in the Deed of Sale and Santiago Puyo, was employed in the said office only in the year
purchase value was there: 2,500.00 document docketed No. 312, 1978. Thus, he did not make nor did he witness the causing of the
Page 17, Book No. 6, Series of 1967, Doroteo de Chavez, the Notary annotation as he was not yet employed in the said office at that
Public, Sir. time. Likewise, he was neither present when the deed of sale was
executed nor did he personally see the said deed of sale. For these
Q Can you explain why this annotation was placed or written in this reasons, the testimony of Pajilan is inconclusive.
tax declaration No. 48221?
Petitioners next argue that Tax Declaration No. 48221 in the name
A This was placed under Tax Declaration No. 48221 because the of Santiago Puyo enjoys the presumption of regularity in its
office of the City Assessor transferred the tax declaration and issuance. It is a good time as any to re-state that this rule is a mere
presumption, not absolute nor inflexible and applies only in the
4- ANSWERING FURTHER, and by way of a second special affirmative 1. He ADMIT[S] paragraphs 1, 2, and 3 of the complaint with a
defense, defendant herein alleges that no demand has ever been qualification in paragraph 3 thereof that he has long been separated
sent to nor received by herein defendant and if ever demands were from his wife and the system governing their property relations is
made, denies any liability as averred therein. that of complete separation of property and not that of conjugal
partnership of gain[s];
5- ANSWERING FURTHER, and by way of a third special and
affirmative defense, defendant herein avers that the complaint 2. He [DENIES], generally and specifically, the allegations contained
states no cause of action and has no basis either in fact or in law; in paragraphs 4, 5, 6, 7, and 8 thereof, for lack of knowledge and
information sufficient to form a belief and as to the truth of the
VERIFICATION matter therein averred, the truth being those alleged in the Special
I, JEANETTE D. TOLENTINO, of legal age, after having been duly And Affirmative Defenses hereinbelow pleaded;
sworn to in accordance with law, depose and state:
That I am the Controller of Del Monte Motor Works, Inc., one of the SPECIAL AND AFFIRMATIVE DEFENSES
defendants in this case.
4. He has never signed the promissory note attached to the
That for and in behalf of the defendant corporation, I caused the complaint in his personal and/or individual capacity as such;
preparation of the above-narrated answer.
5. That the said promissory note is ineffective, unenforceable and
That I have read the contents thereof and they are true of my own void for lack of valid consideration;
knowledge.
6. That even admitting, argumenti gratia, the validity and execution
(SGD) JEANNETTE D. TOLENTINO[4] of the questioned promissory note, still, defendant herein cannot be
bound personally and individually to the said obligations as banking
On 30 September 1985, respondent corporation filed a On 26 December 1985, respondents separately filed their motions
manifestation and motion for reconsideration[12] of the trial courts to dismiss on the similar ground that with the exclusion of Exhibits A
order admitting into evidence petitioners Exhibit E. Respondent and E, petitioner no longer possessed any proof of respondents
corporation claims that Exhibit E should not have been admitted as alleged indebtedness.[16]
it was immaterial, irrelevant, was not properly identified and
hearsay evidence. Respondent corporation insists that Exhibit E was On 08 April 1986, petitioner filed a motion[17] praying that the
not properly identified by Lavarino who testified that he had presiding judge, Judge Ricardo D. Diaz, of the court a quo inhibit
nothing to do in the preparation and execution of petitioners himself from this case maintaining that the latter rushed into
exhibits, one of which was Exhibit E. Further, as there were resolving its motion for reconsideration of the trial courts order of
markings in Exhibit A which were not contained in Exhibit E, the 06 December 1985 thereby depriving it the opportunity of
latter could not possibly be considered an original copy of Exhibit A. presenting proof that the original of Exhibit A was delivered to
Lastly, respondent corporation claims that the exhibit in question respondents as early as 02 April 1983. Such haste on the part of the
had no bearing on the complaint as Lavarino admitted that Exhibit E presiding judge, according to petitioner, cast doubt on his
was not the original of Exhibit A which was the foundation of the objectivity and fairness. This motion to inhibit was denied by the
complaint and upon which respondent corporation based its own trial court on 06 August 1987.[18]
answer.
In an order dated 28 December 1987,[19] the case before the trial
Respondent Morales similarly filed a manifestation with motion to court was dismissed, the dispositive portion of which reads:
reconsider order admitting as evidence Exhibit E[13] which, other
II
The trial courts finding was affirmed by the Court of Appeals in the
assailed decision now before us. The dispositive portion of the THE HONORABLE COURT OF APPEALS GRAVELY ERRED WHEN IT
appellate courts decision reads: UPHELD THE EXCLUSION OF EXHIBIT E, THE SECOND ORIGINAL OF
THE PROMISSORY NOTE, DESPITE THE FACT THAT THE ORIGINAL OF
WHEREFORE, PREMISES CONSIDERED, the decision of the Regional EXHIBIT A (XEROX COPY OF THE DUPLICATE ORIGINAL OF THE
Trial Court, Manila, Branch 27, dated December 28, 1987 dismissing PROMISSORY NOTE) WAS ACTUALLY IN THE POSSESSION OF
plaintiff-appellant['s] complaint is hereby AFFIRMED. Cost against PRIVATE RESPONDENTS, THUS WARRANTING THE ADMISSION OF
the plaintiff-appellant.[20] SECONDARY EVIDENCE.
III
Petitioner thereafter filed a motion for reconsideration dated 14 THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT
December 1999 which was denied for lack of merit in a resolution of HOLDING THAT THE TRIAL JUDGE SHOULD HAVE INHIBITED HIMSELF
the Court of Appeals promulgated on 11 May 2000.[21] FROM TAKING COGNIZANCE OF AND FROM TRYING AND DECIDING
THE INSTANT CASE CONSIDERING HIS PERCEIVED AND MANIFEST
Aggrieved by the appellate courts ruling, petitioner now seeks BIAS AND PARTIALITY IN FAVOR OF THE PRIVATE RESPONDENTS TO
redress from this Court imputing the following errors on the Court THE GRAVE PREJUDICE OF PETITIONER SOLIDBANK.[22]
of Appeals:
I
The petition is meritorious.
THE HONORABLE COURT OF APPEALS GRAVELY ERRED WHEN IT In resolving the case against petitioner, the appellate court held that
FOUND THAT PRIVATE RESPONDENTS DENIED THE MATERIAL contrary to petitioners stance, respondents were able to generally
ALLEGATIONS OF PETITIONER SOLIDBANKS COMPLAINT, DESPITE
The appellate court likewise sustained the ruling of the trial court
that the best evidence rule or primary evidence must be applied as
the purpose of the proof is to establish the terms of the writing The best evidence rule, according to Professor Thayer, first
meaning the alleged promissory note as it is the basis of the appeared in the year 1699-1700 when in one case involving a
recovery of the money allegedly loaned to the defendants goldsmith, Holt, C. J., was quoted as stating that they should take
(respondents herein).[28] into consideration the usages of trade and that the best proof that
the nature of the thing will afford is only required.[29] Over the
The best evidence rule is encapsulated in Rule 130, Section 3, of the years, the phrase was used to describe rules which were already
Revised Rules of Civil Procedure which provides: existing such as the rule that the terms of a document must be
proved by the production of the document itself, in preference to
Sec. 3. Original document must be produced; exceptions. When the evidence about the document; it was also utilized to designate the
subject of inquiry is the contents of a document, no evidence shall hearsay rule or the rule excluding assertions made out of court and
be admissible other than the original document itself, except in the not subject to the rigors of cross-examination; and the phrase was
following cases: likewise used to designate the group of rules by which testimony of
particular classes of witnesses was preferred to that of others.[30]
(a) When the original has been lost or destroyed, or cannot be
produced in court, without bad faith on the part of the offeror; According to McCormick, an authority on the rules of evidence, the
only actual rule that the best evidence phrase denotes today is the
(b) When the original is in the custody or under the control of the rule requiring the production of the original writing[31] the
party against whom the evidence is offered, and the latter fails to rationale being:
produce it after reasonable notice;
Apparently, the parties to the case, namely, the respondent, on one G.R. No. 152985 (Modesta R. Sabeniano vs. Court of Appeals, et al.).
hand, and the petitioners, on the other, made separate attempts to It appearing that petitioner failed to file the intended petition for
bring the aforementioned Decision of the Court of Appeals, dated review on certiorari within the period which expired on May 3,
26 March 2002, before this Court for review. 2002, the Court Resolves to DECLARE THIS CASE TERMINATED and
DIRECT the Division Clerk of Court to INFORM the parties that the
G.R. No. 152985 judgment sought to be reviewed has become final and executory.
From the foregoing, it is clear that Sabeniano had knowledge of, and Petitioners contend that respondent committed forum shopping on
in fact participated in, the proceedings in G.R. No. 156132. She the basis of the following facts:
cannot feign ignorance of the proceedings therein and claim that
the Decision of the Court of Appeals has become final and While petitioners Motion for Reconsideration of the Decision in CA-
executory. More precisely, the Decision became final and executory G.R. CV No. 51930, dated 26 March 2002, was still pending before
only with regard to Sabeniano in view of her failure to file a petition the Court of Appeals, respondent already filed with this Court on 3
for review within the extended period granted by the Court, and not May 2002 her Motion for Extension of Time to File a Petition for
Are you trying to say that you have personal knowledge or Q Now, basing on the notes that you prepared, Mr. Witness, and
participation to these transactions? according to you basing also on your personal recollection about all
the transactions involved between Modesta Sabeniano and
A Yes, your Honor, I was the officer-in charge of the unit that was defendant City Bank [sic] in this case. Now, would you tell us what
processing these transactions. Some of the documents bear my happened to the money market placements of Modesta Sabeniano
signature. that you have earlier identified in Exhs. 47 and 48?
Court: A The transactions which I said earlier were terminated and booked
to time deposits.
And this resume or summary that you have prepared is based on
purely your recollection or documents? Q And you are saying time deposits with what bank?
A Yes, she also opened another time deposit for P600,000.00. Mr. Tan : Yes, Sir.
Q So all in all Mr. Witness, sometime in April of 1978 Mrs. Modesta Atty. Mabasa : Alright, after these Exhibits E and F matured, what
Sabeneano [sic] had time deposit placements with Citibank in the happened thereafter?
amount of P500,000.00 which is the proceeds of Exh. 47 and 48 and
another P600,000.00, is it not? Mr. Tan : Split into two time deposits.
Q And would you know where did the other P600,000 placed by
Mrs. Sabeneano [sic] in a time deposit with Citibank, N.A. came [sic] Before anything else, it should be noted that when Mr. Pujedas
from? testimony before the RTC was made on 12 March 1990 and Mr.
Tans deposition in Hong Kong was conducted on 3 September 1990,
A She funded it directly. more than a decade had passed from the time the transactions they
were testifying on took place. This Court had previously recognized
Q What are you saying Mr. Witness is that the P600,000 is a [sic] the frailty and unreliability of human memory with regards to
fresh money coming from Mrs. Modesta Sabeneano [sic]? figures after the lapse of five years.[38]Taking into consideration the
substantial length of time between the transactions and the
A That is right. witnesses testimonies, as well as the undeniable fact that bank
officers deal with multiple clients and process numerous
transactions during their tenure, this Court is reluctant to give much
Based on the foregoing records, the principal amounts of PNs No. Then again, Checks No. 77035 and 77034 were later returned to
5757 and 5758, upon their maturity, were rolled over to PNs No. petitioner FNCB Finance together with a memo,[47] dated 6
8167 and 8169, respectively. PN No. 8167[45] expressly canceled September 1978, from Mr. Tan of petitioner Citibank, to a Mr.
and superseded PN No. 5757, while PN No. 8169[46] also explicitly Bobby Mendoza of petitioner FNCB Finance. According to the
canceled and superseded PN No. 5758. Thus, it is patently memo, the two checks, in the total amount of P1,000,000.00, were
erroneous for the Court of Appeals to still award to respondent the to be returned to respondents account with instructions to book the
principal amounts and interests covered by PNs No. 5757 and 5758 said amount in money market placements for one more year.
when these were already canceled and superseded. It is now Pursuant to the said memo, Checks No. 77035 and 77034 were
incumbent upon this Court to determine what subsequently invested by petitioner FNCB Finance, on behalf of respondent, in
happened to PNs No. 8167 and 8169. money market placements for which it issued PNs No. 20138 and
20139. The PNs each covered P500,000.00, to earn 11% interest per
Petitioner FNCB Finance presented four checks as proof of payment annum, and to mature on 3 September 1979.
of the principal amounts and interests of PNs No. 8167 and 8169
upon their maturity. All the checks were payable to respondents On 3 September 1979, petitioner FNCB Finance issued Check No.
savings account with petitioner Citibank, with the following details 100168, pay to the order of Citibank N.A. A/C Modesta Sabeniano,
in the amount of P1,022,916.66, as full payment of the principal
Date of Issuance amounts and interests of both PNs No. 20138 and 20139 and,
When respondent was unable to pay the first set of PNs upon their Respondent secured her foregoing loans with petitioner Citibank by
maturity, these were rolled-over or renewed several times, executing Deeds of Assignment of her money market placements
necessitating the execution by respondent of new PNs in favor of with petitioner FNCB Finance. On 2 March 1978, respondent
petitioner Citibank. As of 5 April 1979, respondent had the following executed in favor of petitioner Citibank a Deed of Assignment[57] of
outstanding PNs (second set),[56] the principal amount of which PN No. 8169, which was issued by petitioner FNCB Finance, to
remained at P1,920,000.00 secure payment of the credit and banking facilities extended to her
by petitioner Citibank, in the aggregate principal amount of
P500,000.00. On 9 March 1978, respondent executed in favor of
PN No. Date of Issuance petitioner Citibank another Deed of Assignment,[58] this time, of PN
(mm/dd/yyyy) Date of Maturity No. 8167, also issued by petitioner FNCB Finance, to secure
(mm/dd/yyyy) payment of the credit and banking facilities extended to her by
Principal Amount petitioner Citibank, in the aggregate amount of P500,000.00. When
34510 01/01/1979 03/02/1979 P 400,000.00 PNs No. 8167 and 8169, representing respondents money market
34509 01/02/1979 03/02/1979 100,000.00 placements with petitioner FNCB Finance, matured and were rolled-
34534 01/09/1979 03/09/1979 150,000.00 over to PNs No. 20138 and 20139, respondent executed new Deeds
34612 01/19/1979 03/16/1979 150,000.00 of Assignment,[59] in favor of petitioner Citibank, on 25 August
34741 01/26/1979 03/12/1979 100,000.00 1978. According to the more recent Deeds, respondent assigned
35689 02/23/1979 05/29/1979 300,000.00 PNs No. 20138 and 20139, representing her rolled-over money
35694 03/19/1979 05/29/1979 150,000.00 market placements with petitioner FNCB Finance, to petitioner
35695 03/19/1979 05/29/1979 100,000.00 Citibank as security for the banking and credit facilities it extended
356946 03/20/1979 05/29/1979 250,000.00 to her, in the aggregate principal amount of P500,000.00 per Deed.
35697 03/30/1979 05/29/1979 220,000.00 In addition to the Deeds of Assignment of her money market
placements with petitioner FNCB Finance, respondent also executed
Total a Declaration of Pledge,[60] in which she supposedly pledged [a]ll
When respondent failed to pay the second set of PNs upon their Please bear with us for a little while, at most ninety days. As you
maturity, an exchange of letters ensued between respondent know, we have a pending loan with the Development Bank of the
and/or her representatives, on one hand, and the representatives of Philippines in the amount of P11-M. This loan has already been
petitioners, on the other. recommended for approval and would be submitted to the Board of
Governors. In fact, to further facilitate the early release of this loan,
The first letter[62] was dated 5 April 1979, addressed to respondent we have presented and furnished Gov. J. Tengco a xerox copy of
and signed by Mr. Tan, as the manager of petitioner Citibank, which your letter.
stated, in part, that
You will be doing our corporation a very viable service, should you
Despite our repeated requests and follow-up, we regret you have grant us our request for a little more time.
not granted us with any response or payment.
We, therefore, have no alternative but to call your loan of A week later or on 3 May 1979, a certain C. N. Pugeda, designated
P1,920,000.00 plus interests and other charges due and as Executive Secretary, sent a letter[64] to petitioner Citibank, on
demandable. If you still fail to settle this obligation by 4/27/79, we behalf of respondent. The letter was again printed on paper bearing
shall have no other alternative but to refer your account to our the letterhead of MC Adore International Palace. The pertinent
lawyers for legal action to protect the interest of the bank. paragraphs of the said letter are reproduced below
Balance of respondents obligation Eventually, Atty. Antonio Agcaoili of Agcaoili & Associates, as
P 1,069,847.40 counsel of petitioner Citibank, sent a letter to respondent, dated 31
October 1979, informing her that petitioner Citibank had effected
Mr. Tan of petitioner Citibank subsequently sent a letter,[69] dated an off-set using her account with Citibank-Geneva, in the amount of
28 September 1979, notifying respondent of the status of her loans US$149,632.99, against her outstanding, overdue, demandable and
and the foregoing compensation which petitioner Citibank effected. unpaid obligation to petitioner Citibank. Atty. Agcaoili claimed
In the letter, Mr. Tan informed respondent that she still had a therein that the compensation or off-set was made pursuant to and
remaining past-due obligation in the amount of P1,069,847.40, as of in accordance with the provisions of Articles 1278 through 1290 of
5 September 1979, and should respondent fail to pay the amount by the Civil Code. He further declared that respondents obligation to
15 October 1979, then petitioner Citibank shall proceed to off-set petitioner Citibank was now fully paid and liquidated.
the unpaid amount with respondents other collateral, particularly, a
money market placement in Citibank-Hongkong. Unfortunately, on 7 October 1987, a fire gutted the 7th floor of
petitioner Citibanks building at Paseo de Roxas St., Makati, Metro
On 5 October 1979, respondent wrote Mr. Tan of petitioner Manila. Petitioners submitted a Certification[70] to this effect,
Citibank, on paper bearing the letterhead of MC Adore International dated 17 January 1991, issued by the Chief of the Arson
Palace, as regards the P1,920,000.00 loan account supposedly of MC Investigation Section, Fire District III, Makati Fire Station,
Adore Finance & Investment, Inc., and requested for a statement of Metropolitan Police Force. The 7th floor of petitioner Citibanks
account covering the principal and interest of the loan as of 31 building housed its Control Division, which was in charge of keeping
Neither can this Court give credence to respondents contention that Respondent presented several more pieces of evidence to
the notations on the MCs, stating that they were the proceeds of substantiate her claim that she received MCs No. 226285, 226439,
Respondent further submitted handwritten notes that purportedly Exhibits III and III-1, the front and bank pages of a handwritten note
computed and presented the returns on her money market of Mr. Bobby Mendoza of petitioner FNCB Finance,[98] also did not
placements, corresponding to the amount stated in the MCs she deserve much evidentiary weight, and this Court cannot rely on the
received from petitioner Citibank. Exhibit HHH-1[96] was a truth and accuracy of the computations presented therein. Mr.
handwritten note, which respondent attributed to Mr. Tan of Mendoza was not presented as a witness during the trial before the
petitioner Citibank, showing the breakdown of her BPI Check for RTC, so that the document was not properly authenticated nor its
P500,000.00 into three different money market placements with contents sufficiently explained. No one was able to competently
petitioner Citibank. This Court, however, noticed several factors identify whether the initials as appearing on the note were actually
which render the note highly suspect. One, it was written on the Mr. Mendozas.
reversed side of Provisional Receipt No. 12724 of petitioner Citibank
which bore the initials of Mr. Tan acknowledging receipt of Also, going by the information on the front page of the note, this
respondents BPI Check No. 120989 for P500,000.00; but the initials Court observes that payment of respondents alleged money market
on the handwritten note appeared to be that of Mr. Bobby placements with petitioner FNCB Finance were made using Citytrust
Mendoza of petitioner FNCB Finance.[97] Second, according to Checks; the MCs in question, including MC No. 228057, were issued
Provisional Receipt No. 12724, BPI Check No. 120989 for by petitioner Citibank. Although Citytrust (formerly Feati Bank &
P500,000.00 was supposed to be invested in three money market Trust Co.), petitioner FNCB Finance, and petitioner Citibank may be
placements with petitioner Citibank for the period of 60 days. Since affiliates of one another, they each remained separate and distinct
This Court disagrees in the pronouncement made by the Court of As the afore-quoted provision states, the best evidence rule applies
Appeals summarily dismissing the documentary evidence submitted only when the subject of the inquiry is the contents of the
by petitioners based on its broad and indiscriminate application of document. The scope of the rule is more extensively explained thus
the best evidence rule.
In general, the best evidence rule requires that the highest available But even with respect to documentary evidence, the best evidence
degree of proof must be produced. Accordingly, for documentary rule applies only when the content of such document is the subject
evidence, the contents of a document are best proved by the of the inquiry. Where the issue is only as to whether such document
production of the document itself,[113] to the exclusion of any was actually executed, or exists, or on the circumstances relevant to
secondary or substitutionary evidence.[114] or surrounding its execution, the best evidence rule does not apply
and testimonial evidence is admissible (5 Moran, op. cit., pp. 76-66;
The best evidence rule has been made part of the revised Rules of 4 Martin, op. cit., p. 78). Any other substitutionary evidence is
Court, Rule 130, Section 3, which reads likewise admissible without need for accounting for the original.
SEC. 3. Original document must be produced; exceptions. When the Thus, when a document is presented to prove its existence or
subject of inquiry is the contents of a document, no evidence shall condition it is offered not as documentary, but as real, evidence.
be admissible other than the original document itself, except in the Parol evidence of the fact of execution of the documents is allowed
following cases: (Hernaez, et al. vs. McGrath, etc., et al., 91 Phil 565). x x x [115]
In the Dy case, Severino Chua Caedo managed to obtain loans from While the Court of Appeals can take judicial notice of the Decision of
herein petitioner Citibank amounting to P7,000,000.00, secured to its Third Division in the Dy case, it should not have given the said
the extent of P5,000,000.00 by a Third Party Real Estate Mortgage case much weight when it rendered the assailed Decision, since the
of the properties of Caedos aunt, Rosalind Dy. It turned out that former does not constitute a precedent. The Court of Appeals, in
Rosalind Dy and her husband were unaware of the said loans and the challenged Decision, did not apply any legal argument or
the mortgage of their properties. The transactions were carried out principle established in the Dy case but, rather, adopted the findings
exclusively between Caedo and Mr. Tan of petitioner Citibank. The therein of wrongdoing or misconduct on the part of herein
RTC found Mr. Tan guilty of fraud for his participation in the petitioner Citibank and Mr. Tan. Any finding of wrongdoing or
questionable transactions, essentially because he allowed Caedo to misconduct as against herein petitioners should be made based on
take out the signature cards, when these should have been signed the factual background and pieces of evidence submitted in this
by the Dy spouses personally before him. Although the Dy spouses case, not those in another case.
signatures in the PNs and Third Party Real Estate Mortgage were
The rule is founded upon reason, public policy, justice and judicial Compensation is a recognized mode of extinguishing obligations.
convenience. The fact that a person has committed the same or Relevant provisions of the Civil Code provides
similar acts at some prior time affords, as a general rule, no logical
guaranty that he committed the act in question. This is so because, Art. 1278. Compensation shall take place when two persons, in their
subjectively, a mans mind and even his modes of life may change; own right, are creditors and debtors of each other.
and, objectively, the conditions under which he may find himself at
a given time may likewise change and thus induce him to act in a Art. 1279. In order that compensation may be proper, it is
different way.Besides, if evidence of similar acts are to be invariably necessary;
admitted, they will give rise to a multiplicity of collateral issues and (1) That each one of the obligors be bound principally, and that he
will subject the defendant to surprise as well as confuse the court be at the same time a principal creditor of the other;
and prolong the trial.[121] (2) That both debts consist in a sum of money, or if the things due
are consumable, they be of the same kind, and also of the same
quality if the latter has been stated;
The factual backgrounds of the two cases are so different and (3) That the two debts be due;
unrelated that the Dy case cannot be used to prove specific intent, (4) That they be liquidated and demandable;
knowledge, identity, plan, system, scheme, habit, custom or usage (5) That over neither of them there be any retention or
on the part of petitioner Citibank or its officer, Mr. Tan, to defraud controversy, commenced by third persons and communicated in
respondent in the present case. due time to the debtor.
IV
On the evidentiary value of these documents, it should be recalled Petitioners not only presented the notarized Deeds of Assignment,
that the notarization of a private document converts it into a public but even secured certified literal copies thereof from the National
one and renders it admissible in court without further proof of its Archives.[127] Mr. Renato Medua, an archivist, working at the
authenticity (Joson vs. Baltazar, 194 SCRA 114 [1991]). This is so Records Management and Archives Office of the National Library,
because a public document duly executed and entered in the proper testified that the copies of the Deeds presented before the RTC
registry is presumed to be valid and genuine until the contrary is were certified literal copies of those contained in the Notarial
shown by clear and convincing proof (Asido vs. Guzman, 57 Phil. 652 Registries of the notary publics concerned, which were already in
[1918]; U.S. vs. Enriquez, 1 Phil 241 [1902]; Favor vs. Court of the possession of the National Archives. He also explained that he
Appeals, 194 SCRA 308 [1991]). As such, the party challenging the could not bring to the RTC the Notarial Registries containing the
The Formal Offer of Documentary Evidence of [Romeo Sioson], the I. PROCEDURAL ISSUE:
Comments/Objections of [herein petitioner] Atienza, [therein
respondents] De la Vega and Lantin, and the Manifestation of WHETHER PETITIONER ATIENZA AVAILED OF THE PROPER REMEDY
[therein] respondent Florendo are hereby ADMITTED by the [BOM] WHEN HE FILED THE PETITION FOR CERTIORARI DATED 06
for whatever purpose they may serve in the resolution of this case. DECEMBER 2004 WITH THE COURT OF APPEALS UNDER RULE 65 OF
WHETHER THE COURT OF APPEALS COMMITTED GRAVE REVERSIBLE Petitioner argues that the exhibits formally offered in evidence by
ERROR AND DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT IN Editha: (1) violate the best evidence rule; (2) have not been properly
ACCORDANCE WITH LAW AND THE APPLICABLE DECISIONS OF THE identified and authenticated; (3) are completely hearsay; and (4) are
HONORABLE COURT WHEN IT UPHELD THE ADMISSION OF incompetent to prove their purpose. Thus, petitioner contends that
INCOMPETENT AND INADMISSIBLE EVIDENCE BY RESPONDENT the exhibits are inadmissible evidence.
BOARD, WHICH CAN RESULT IN THE DEPRIVATION OF
PROFESSIONAL LICENSE A PROPERTY RIGHT OR ONES We disagree.
LIVELIHOOD.[4]
To begin with, it is well-settled that the rules of evidence are not
strictly applied in proceedings before administrative bodies such as
We find no reason to depart from the ruling of the CA. the BOM.[6] Although trial courts are enjoined to observe strict
enforcement of the rules of evidence,[7] in connection with
Petitioner is correct when he asserts that a petition for certiorari is evidence which may appear to be of doubtful relevancy,
the proper remedy to assail the Orders of the BOM, admitting in incompetency, or admissibility, we have held that:
evidence the exhibits of Editha. As the assailed Orders were
interlocutory, these cannot be the subject of an appeal separate [I]t is the safest policy to be liberal, not rejecting them on doubtful
from the judgment that completely or finally disposes of the or technical grounds, but admitting them unless plainly irrelevant,
case.[5] At that stage, where there is no appeal, or any plain, immaterial or incompetent, for the reason that their rejection
speedy, and adequate remedy in the ordinary course of law, the places them beyond the consideration of the court, if they are
only and remaining remedy left to petitioner is a petition for thereafter found relevant or competent; on the other hand, their
certiorari under Rule 65 of the Rules of Court on the ground of grave admission, if they turn out later to be irrelevant or incompetent, can
abuse of discretion amounting to lack or excess of jurisdiction. easily be remedied by completely discarding them or ignoring
them.[8]
However, the writ of certiorari will not issue absent a showing that
the BOM has acted without or in excess of jurisdiction or with grave
Second, petitioners insistence that the admission of Edithas exhibits The exhibits are certified photocopies of X-ray Request Forms dated
violated his substantive rights leading to the loss of his medical December 12, 1996, January 30, 1997, March 16, 1996, and May 20,
license is misplaced. Petitioner mistakenly relies on Section 20, 1999, filed in connection with Edithas medical case. The documents
Article I of the Professional Regulation Commission Rules of contain handwritten entries interpreting the results of the
Procedure, which reads: examination. These exhibits were actually attached as annexes to
Dr. Pedro Lantin IIIs counter affidavit filed with the Office of the City
Section 20. Administrative investigation shall be conducted in Prosecutor of Pasig City, which was investigating the criminal
accordance with these Rules. The Rules of Court shall only apply in complaint for negligence filed by Editha against the doctors of Rizal
these proceedings by analogy or on a suppletory character and Medical Center (RMC) who handled her surgical procedure. To lay
whenever practicable and convenient. Technical errors in the the predicate for her case, Editha offered the exhibits in evidence to
admission of evidence which do not prejudice the substantive rights prove that her kidneys were both in their proper anatomical
of either party shall not vitiate the proceedings.[10] locations at the time of her operation.
As pointed out by the appellate court, the admission of the exhibits The fact sought to be established by the admission of Edithas
did not prejudice the substantive rights of petitioner because, at any exhibits, that her kidneys were both in their proper anatomical
rate, the fact sought to be proved thereby, that the two kidneys of locations at the time of her operation, need not be proved as it is
Editha were in their proper anatomical locations at the time she was covered by mandatory judicial notice.[11]
operated on, is presumed under Section 3, Rule 131 of the Rules of
Court:
Sec. 3. Original document must be produced; exceptions. When the Finally, these exhibits do not constitute hearsay evidence of the
subject of inquiry is the contents of a document, no evidence shall anatomical locations of Edithas kidneys. To further drive home the
be admissible other than the original document itself, except in the point, the anatomical positions, whether left or right, of Edithas
following cases: kidneys, and the removal of one or both, may still be established
through a belated ultrasound or x-ray of her abdominal area.
(a) When the original has been lost or destroyed, or cannot be
produced in court, without bad faith on the part of the offeror; In fact, the introduction of secondary evidence, such as copies of
the exhibits, is allowed.[15] Witness Dr. Nancy Aquino testified that
(b) When the original is in the custody or under the control of the the Records Office of RMC no longer had the originals of the exhibits
party against whom the evidence is offered, and the latter fails to because [it] transferred from the previous building, x x x to the new
produce it after reasonable notice; building.[16] Ultimately, since the originals cannot be produced, the
BOM properly admitted Edithas formal offer of evidence and,
(c) When the original consists of numerous accounts or other thereafter, the BOM shall determine the probative value thereof
documents which cannot be examined in court without great loss of when it decides the case.
HI, on the other hand, asserted that it was an independent job [T]he undisputed facts show that the [herein petitioners] were
contractor engaged in the business of providing janitorial and made to perform not only as janitors but also as messengers, drivers
related services to business establishments, and E-PCIBank was one and one of them even worked as an electrician. For us, these jobs
of its clients. Petitioners were its employees, part of its pool of are not only directly related to the main business of the principal
janitors/messengers assigned to E-PCIBank. The Contract for but are, likewise deemed necessary in the conduct of respondent
Services between HI and E-PCIBank expired on 15 July 2000. E- Equitable-PCI Banks principal business. Thus, based on the above,
PCIBank no longer renewed said contract with HI and, instead, we so declare that the [petitioners] are employees of respondent
bidded out its janitorial requirements to two other job contractors, Equitable-PCI Bank. And having worked with respondent Equitable-
Able Services and Puritan. HI designated petitioners to new work PCI Bank for more than one (1) year, they are deemed regular
assignments, but the latter refused to comply with the same. employees. They cannot, therefore, be removed from employment
Petitioners were not dismissed by HI, whether actually or without cause and without due process, which is wanting in this
constructively, thus, petitioners complaints before the NLRC were case.Hence, the severance of their employment in the guise of
without basis. termination of contract is illegal.[17]
= P25,840.00
= P25,840.00
b) Separation Pay
June 10, 1996 to July 15, 2001
= 5 years = P6,175.00
=P190.00 x 26 days x 5 years / 2 = P32,015.00
=P12,350.00 a) Backwages
c) 13th Month Pay (same as Paciencia)
= P190.00 x 26 days
Total b) Separation Pay
= P4,940.00 March 8, 1998 to July 15, 2001
P43,130.00 = P190.00 x 26 days x 3 yrs. / 2
Total
II Dominador Suico, Jr. (did not file Amended Complaint)
a) Backwages
July 15, 2001 to January 15, 2002 = P25,840.00
= P25,840.00
= P4,940.00
= P60,420.00
a) Backwages
= P4,940.00 (same as Paciencia)
= P72,770.00
b) Separation Pay
V Rolando Sasan, Sr. Feb. 8, 1983 to July 15, 2001
= P25,840.00
= P4,940.00
= P53,010.00
a) Backwages
= P4,940.00 (same as Pacencia)
= P75,240.00
b) Separation Pay
VII Eleuterio Sacil October 7, 1987 to July 15, 2001
= P190.00 x 26 days x 14 yrs. / 2
a) Backwages
(same as Paciencia) c) 13th Month Pay
= P190.00 x 26 days
b) Separation Pay Total
June 2, 1992 to July 15, 2001
= P190.00 x 26 days x 9 yrs. / 2
= P25,840.00
c) 13th Month Pay
= P190.00 x 26 days
Total
= P34,580.00
= P25,840.00
= P4,940.00
= P54,245.00
a) Backwages
= P4,840.00 (same as Paciencia)
= P57,950.00
b) Separation Pay
X Modesto Aguirre = Jan. 20, 1990 to July 15, 2001
= P25,840.00
Aggrieved by the decision of Labor Arbiter Gutierrez, respondents E-
PCIBank and HI appealed the same to the NLRC, 4th Division,
stationed in Cebu City. Their appeals were docketed as NLRC Case
= P28,405.00 No. V-000241-2002. In support of its allegation that it was a
legitimate job contractor, HI submitted before the NLRC several
documents which it did not present before Labor Arbiter Gutierrez.
= P4,940.00 These are:
= P59,185.00
1. Certificate of Filing of Certificate of Increase of Capital Stock,
xxxx Certificate of Filing Amended Articles of Incorporation, and General
Information Sheet Stock Corporation of HI showing therein that it
WHEREFORE, the foregoing premises considered, judgment is increased its authorized capital stock from P1,500,000.00 to
hereby rendered directing the respondents Equitable PCI Bank and P20,000,000.00 on 12 March 1999 with the Securities and Exchange
Helpmate, Inc. to pay jointly and solidarily the complainants as Commission;
follows:
2. Audited Financial Statement of HI showing therein that it has
1. Cesar Paciencia - P43,130.00 Total Assets of P20,939,935.72 as of 31 December 2000;
2. Dominador Suico, Jr. - 32,015.00
3. Roland Mosquera - 33,250.00 3. Transfer Certificate of Title No. 110173 and Tax Declaration No.
4. Petronilo Carceda - 72,770.00 GR2K-09-063-00582 registered under the name of HI showing that it
5. Roland Sasan, Sr. - 60,420.00 has a parcel of land with Market Value of P1,168,860.00 located
6. Leonilo Dayday - 75,240.00 along Rizal Avenue (now Bacalso Avenue), Cebu City, and
WHEREFORE, in view of the foregoing premises, judgment is hereby Petitioners object to the acceptance and consideration by the NLRC
rendered by us DENYING the petition filed in this case and of the evidence presented by HI for the first time on appeal. This is
AFFIRMING the decision of the NLRC, Fourth Division, in NLRC Case not a novel procedural issue, however, and our jurisprudence is
No. V-000145-2003 promulgated on June 22, 2003.[27] already replete with cases[29] allowing the NLRC to admit evidence,
not presented before the Labor Arbiter, and submitted to the NLRC
for the first time on appeal. Technical rules of evidence are not
Petitioners now come before us via the instant Petition raising the binding in labor cases. Labor officials should use every reasonable
following issues: means to ascertain the facts in each case speedily and objectively,
[T]he NLRC is not precluded from receiving evidence, even for the The above provision explicitly mandates that when the subject of
first time on appeal, because technical rules of procedure are not inquiry is the contents of a document, no evidence shall be
binding in labor cases. admissible other than the original document itself. Notably, certified
true copies of these documents, acceptable under the Rules of
The settled rule is that the NLRC is not precluded from receiving Court[33] were furnished to the petitioners. Even assuming that
evidence on appeal as technical rules of evidence are not binding in petitioners were given mere photocopies, again, we stress that
labor cases. In fact, labor officials are mandated by the Labor Code proceedings before the NLRC are not covered by the technical rules
to use every and all reasonable means to ascertain the facts in each of evidence and procedure as observed in the regular courts.
case speedily and objectively, without regard to technicalities of law Technical rules of evidence do not apply if the decision to grant the
or procedure, all in the interest of due process. Thus, in Lawin petition proceeds from an examination of its sufficiency as well as a
Security Services v. NLRC, and Bristol Laboratories Employees
is issued to
In distinguishing between permissible job contracting and
prohibited labor-only contracting,[39] we elucidated in Vinoya v. HELPMATE, INCORPORATED
National Labor Relations Commission,[40] that it is not enough to 330 N. Bacalso Avenue, Cebu City
show substantial capitalization or investment in the form of tools,
equipment, etc. Other facts that may be considered include the for having complied with the requirements as provided for under
following: whether or not the contractor is carrying on an the Labor Code, as amended, and its Implementing Rules and having
independent business; the nature and extent of the work; the skill paid the registration fee in the amount of ONE HUNDRED PESOS
required; the term and duration of the relationship; the right to (P100.00) per Official Receipt Number 9042769, dated October 16,
assign the performance of specified pieces of work; the control and 1997.
supervision of the work to another; the employers power with
respect to the hiring, firing and payment of the contractors workers; In witness whereof, and by authority vested in me by the Labor
the control of the premises; the duty to supply premises, tools, Code, as amended, and its Implementing Rules specifically
appliances, materials and labor; and the mode and manner or terms Department Order No. 10 series of 1997, I have hereunto set my
of payment.[41] Simply put, the totality of the facts and the hand and affixed the Official on this 23rd day of December
surrounding circumstances of the case are to be considered.[42] 1997.[45]
Each case must be determined by its own facts and all the features
of the relationship are to be considered.[43] Having been issued by a public officer, this certification carries with
it the presumption that it was issued in the regular performance of
1. Acknowledgement by the Vendor to the Purchaser or any 5. All goods must be suitably packed or otherwise prepared for
delivery made by the Vendor pursuant to this order shall constitute delivery to the satisfaction of the carrier. No charges are to be made
acceptance by the Vendor of this order and a contract between the for wrapping packing cartons boxes or crating unless authorized by
Vendor and the Purchaser in terms of this order to the exclusion of this order.
all other terms and conditions between them.
The claim for actual damages in this case should be admitted with Before this Court is a Petition for Review on Certiorari under Rule 45
extreme caution since it is based only on bare assertions without of the Rules of Court assailing the Decision[1] of the Court of
support from independent evidence. In determining actual Appeals (CA) dated May 20, 2004 in CA-G.R. CV No. 72193, which
damages, the Court cannot rely on mere assertions, speculations, had affirmed in toto the Decision[2] of the Regional Trial Court (RTC)
conjectures or guesswork but must depend on competent proof and of Pasig City, Branch 157, dated September 10, 2001 in Civil Case
on the best evidence obtainable regarding the actual amount of No. 64943.
loss.[25]
Seaoil claims that Rodriguez issued a stop payment order on the ten - 25% of the total amount due as attorneys fees and cost
checks thus constraining the former to also order a stop payment of litigation.
order on the PBCOM checks.
The third-party complaint filed by defendant Seaoil Petroleum
In short, Seaoil claims that the real transaction is that Uniline, Corporation against third-party defendant Paul Rodriguez is hereby
through Rodriguez, owed money to Focus. In lieu of payment, DISMISSED for lack of merit.
Uniline instead agreed to convey the excavator to Focus. This was to
be paid by checks issued by Seaoil but which in turn were to be SO ORDERED.
funded by checks issued by Uniline. x x x[3]
Seaoil filed a Petition for Review before the CA. In its assailed
As narrated above, respondent Autocorp filed a Complaint for Decision, the CA dismissed the petition and affirmed the RTCs
Recovery of Personal Property with Damages and Replevin[4] Decision in toto.[6] It held that the transaction between Yu and
against Seaoil before the RTC of Pasig City. In its September 10, Rodriguez was merely verbal. This cannot alter the sales contract
2001 Decision, the RTC ruled that the transaction between Autocorp between Seaoil and Autocorp as this will run counter to the parol
and Seaoil was a simple contract of sale payable in installments.[5] evidence rule which prohibits the introduction of oral and parol
It also held that the obligation to pay plaintiff the remainder of the evidence to modify the terms of the contract. The claim that it falls
purchase price of the excavator solely devolves on Seaoil. Paul under the exceptions to the parol evidence rule has not been
Rodriguez, not being a party to the sale of the excavator, could not sufficiently proven. Moreover, it held that Autocorps separate
be held liable therefor. The decretal portion of the trial courts corporate personality cannot be disregarded and the veil of
Decision reads, thus: corporate fiction pierced. Seaoil was not able to show that Autocorp
was merely an alter ego of Uniline or that both corporations were
WHEREFORE, judgment is hereby rendered in favor of plaintiff utilized to perpetrate a fraud. Lastly, it held that the RTC was correct
Autocorp Group and against defendant Seaoil Petroleum in dismissing the third-party complaint since it did not arise out of
Corporation which is hereby directed to pay plaintiff: the same transaction on which the plaintiffs claim is based, or that
the third partys claim, although arising out of another transaction, is
Seaoil now comes before this Court in a Petition for Review raising
the following issues: The Petition lacks merit. We sustain the ruling of the CA.
Whether or not the dismissal of the third-party complaint would Unsubstantiated testimony, offered as proof of verbal agreements
have the legal effect of res judicata as would unjustly preclude which tends to vary the terms of a written agreement, is
petitioner from enforcing its claim against respondent Rodriguez inadmissible under the parol evidence rule.[8]
(third-party defendant) in a separate action.
Rule 130, Section 9 of the Revised Rules on Evidence embodies the
IV parol evidence rule and states:
The parol evidence rule forbids any addition to, or contradiction of, The terms of the subject sales invoice are clear. They show that
the terms of a written agreement by testimony or other evidence Autocorp sold to Seaoil one unit Robex 200 LC Excavator paid for by
purporting to show that different terms were agreed upon by the checks issued by one Romeo Valera. This does not, however, change
parties, varying the purport of the written contract.[9] the fact that Seaoil Petroleum Corporation, as represented by Yu, is
This principle notwithstanding, petitioner would have the Court rule the customer or buyer. The moment a party affixes his or her
that this case falls within the exceptions, particularly that the signature thereon, he or she is bound by all the terms stipulated
Hence, petitioners contention that the document falls within the It is settled that a corporation has a personality separate and
exception to the parol evidence rule is untenable. The exception distinct from its individual stockholders or members, and is not
obtains only where the written contract is so ambiguous or obscure affected by the personal rights, obligations and transactions of the
in terms that the contractual intention of the parties cannot be latter.[21] The corporation may not be held liable for the obligations
understood from a mere reading of the instrument. In such a case, of the persons composing it, and neither can its stockholders be
extrinsic evidence of the subject matter of the contract, of the held liable for its obligation.[22]
relations of the parties to each other, and of the facts and
circumstances surrounding them when they entered into the Of course, this Court has recognized instances when the
contract may be received to enable the court to make a proper corporations separate personality may be disregarded. However, we
interpretation of the instrument.[18] have also held that the same may only be done in cases where the
corporate vehicle is being used to defeat public convenience, justify
Even assuming there is a shred of truth to petitioners contention, wrong, protect fraud, or defend crime.[23] Moreover, the
the same cannot be made a basis for holding respondents liable wrongdoing must be clearly and convincingly established. It cannot
therefor. be presumed.[24]
As pointed out by the CA, Rodriguez is a person separate and To reiterate, the transaction under the Vehicle Sales Invoice is
independent from Autocorp. Whatever obligations Rodriguez separate and distinct from that under the Lease Purchase
contracted cannot be attributed to Autocorp[19] and vice versa. In Agreement. In the former, it is Seaoil that owes Autocorp, while in
fact, the obligation that petitioner proffers as its defense under the the latter, Uniline incurred obligations to Focus. There was never
Lease Purchase Agreement was not even incurred by Rodriguez or any allegation, much less any evidence, that Autocorp was merely
by Autocorp but by Uniline. an alter ego of Uniline, or that the two corporations separate
Rule 6, Section 11 of the Revised Rules on Civil Procedure defines a Considering, first, that Focus Point was not a party to the sale of the
third-party complaint as a claim that a defending party may, with excavator and, second, that Seaoil indeed failed to pay for the
leave of court, file against a person not a party to the action, called excavator in full, the same still rightfully belongs to Autocorp.
the third-party defendant, for contribution, indemnity, subrogation Additionally, as the trial court found, Seaoil had already assigned
or any other relief, in respect of his opponents claim. the same to its contractor for the construction of its depot in
Batangas.[32] Hence, Seaoil has already enjoyed the benefit of the
The purpose of the rule is to permit a defendant to assert an transaction even as it has not complied with its obligation. It cannot
independent claim against a third party which he, otherwise, would be permitted to unjustly enrich itself at the expense of another.
SO ORDERED.[4]
DEL CASTILLO, J.
The reinstated Decision of the Department of Agrarian Reform
When the parties admit the contents of written documents but put Adjudication Board (DARAB) of Bayombong, Nueva Vizcaya, in turn,
in issue whether these documents adequately and correctly express contained the following dispositive portion:
the true intention of the parties, the deciding body is authorized to
look beyond these instruments and into the contemporaneous and Accordingly, judgment is rendered:
subsequent actions of the parties in order to determine such intent.
1. Finding [respondents] to be the owner by re-purchase
Well-settled is the rule that in case of doubt, it is the intention of from RBBI [of] the Murong property covered by TCT No. [T-]62096
the contracting parties that prevails, for the intention is the soul of a (formerly TCT No. 43258);
contract, not its wording which is prone to mistakes, inadequacies,
or ambiguities. To hold otherwise would give life, validity, and 2. Ordering the cancellation of TCT with CLOA Nos. 395
precedence to mere typographical errors and defeat the very and 396 in the name[s] of Salun-at Marquez and Nestor de la Cruz
purpose of agreements. respectively, as they are disqualified to become tenants of the
This Petition for Review on Certiorari[1] assails the October 7, 2003 Lantap property;
Decision,[2] as well as the May 11, 2005 Resolution[3] of the Court
of Appeals (CA) in CA G.R. SP No. 69981. The dispositive portion of 3. Directing RBBI to sell through VOS the Lantap property
the appellate courts Decision reads: to its rightful beneficiary, herein tenant-farmer Nemi Fernandez
under reasonable terms and conditions;
Upon appeal filed by petitioners, the DARAB reversed the OIC- WHEREFORE, premises considered and finding reversible errors[,]
RARAD Decision. It ruled that in assailing the validity of the CLOAs the assailed decision is ANNULLED and a new judgment is hereby
issued to petitioners as bona fide tenant-farmers, the burden of rendered, declaring:
proof rests on the respondents. There being no evidence that the
DAR field personnel were remiss in the performance of their official 1. Appellants Salun-at Marquez and Nestor Dela Cruz as the
duties when they issued the corresponding CLOAs in favor of bona fide tenant-tillers over the Murong property and therefore
petitioners, the presumption of regular performance of duty they are the qualified beneficiaries thereof;
prevails. This conclusion is made more imperative by the
respondents admission that petitioners are the actual tillers of the 2. Declaring Transfer Certificate of Title (TCT) Nos. 395 and
Murong property, hence qualified beneficiaries thereof. 396 issued in the name of [farmer-beneficiaries] Salun-at Marquez
and Nestor Dela Cruz respectively, covered formerly by TCT No.
As for respondents allegation that they bought back the Murong 62096 (TCT No. 43258) of the Murong property as valid and legal;
property from RBBI, the DARAB ruled that they failed to support
their allegation with substantial evidence. It gave more credence to 3. Ordering the co-[respondents] to firm-up an agricultural
RBBIs claim that respondents repurchased the Lantap property, not leasehold contract with bona fide tenant-tiller Nemi Fernandez over
the Murong property. Respondents, as owners of the Lantap the Lantap property, [the latter] being the subject matter of the buy
property, were ordered to enter into an agricultural leasehold back arrangement entered into between [respondents] and Rural
contract with their brother-in-law Nemi, who is the actual tenant of Bank of Bayombong, Incorporated, and other incidental matters are
the Lantap property. deemed resolved.
In appealing to the CA, the respondents insisted that the DARAB Both the RBBI[26] and petitioners[27] filed their respective motions
erred in ruling that they repurchased the Lantap property, while the for reconsideration, which were separately denied.[28]
petitioners were awarded the Murong property. They were
adamant that the title numbers indicated in their respective deeds On June 22, 2004, RBBI filed a separate Petition for Review on
of conveyance should control in determining the subjects thereof. Certiorari, docketed as G.R. No. 163320, with this Court.[29] RBBI
Since respondents Deed of Sale expressed that its subject is the raised the issue that the CA failed to appreciate that respondents
property with TCT No. T-62096, then what was sold to them was the did not come to court with clean hands because they misled RBBI to
Murong property. On the other hand, petitioners VLTs and CLOAs believe at the time of the sale that the two lots were not tenanted.
say that they cover the property with TCT No. T-62836; thus it RBBI also asked that they be declared free from any liability to the
should be understood that they were awarded the Lantap property. parties as it did not enrich itself at anyones expense. RBBIs petition
Respondents added that since petitioners are not the actual tillers was dismissed on July 26, 2004 for lack of merit. The said Resolution
of the Lantap property, their CLOAs should be cancelled due to their reads:
lack of qualification.
Considering the allegations, issues[,] and arguments adduced in the
The CA agreed with the respondents. Using the Best Evidence Rule petition for review on certiorari, the Court Resolves to DENY the
embodied in Rule 130, Section 3, the CA held that the Deed of Sale petition for lack of sufficient showing that the Court of Appeals had
is the best evidence as to its contents, particularly the description of committed any reversible error in the questioned judgment to
the land which was the object of the sale. Since the Deed of Sale warrant the exercise by this Court of its discretionary appellate
expressed that its subject is the land covered by TCT No. T-62096 jurisdiction in this case.[30]
the Murong property then that is the property that the respondents
repurchased.
The CA further ruled that as for petitioners VLTs, the same refer to Their Motion for Reconsideration was likewise denied with
the property with TCT No. T-62836; thus, the subject of their CLOAs finality.[31] Entry of judgment was made in that case on December
is the Lantap property. The additional description in the VLTs that 15, 2004.[32]
Petitioners argue that the appellate court erred in using the best As to the VLTs, respondents contend that the reference to TCT No.
evidence rule to determine the subject of the Deed of Sale and the T-62836 (corresponding to the Lantap property) reflects the true
Deeds of Voluntary Land Transfer. They maintain that the issue in intention of RBBI and the petitioners, and the reference to Barangay
the case is not the contents of the contracts but the intention of the Murong was a typographical error. On the other hand, petitioners
parties that was not adequately expressed in their contracts. claim that the reference to Barangay Murong reflects their true
Petitioners then argue that it is the Parol Evidence Rule that should intention, while the reference to TCT No. T-62836 was a mere error.
be applied in order to adequately resolve the dispute. This dispute reflects an intrinsic ambiguity in the contracts, arising
from an apparent failure of the instruments to adequately express
Indeed, the appellate court erred in its application of the Best the true intention of the parties. To resolve the ambiguity, resort
Evidence Rule. The Best Evidence Rule states that when the subject must be had to evidence outside of the instruments.
of inquiry is the contents of a document, the best evidence is the
original document itself and no other evidence (such as a The CA, however, refused to look beyond the literal wording of the
reproduction, photocopy or oral evidence) is admissible as a general documents and rejected any other evidence that could shed light on
rule. The original is preferred because it reduces the chance of the actual intention of the contracting parties. Though the CA cited
undetected tampering with the document.[42] the Best Evidence Rule, it appears that what it actually applied was
the Parol Evidence Rule instead, which provides:
In the instant case, there is no room for the application of the Best
Evidence Rule because there is no dispute regarding the contents of When the terms of an agreement have been reduced to writing, it is
the documents. It is admitted by the parties that the respondents considered as containing all the terms agreed upon and there can
Deed of Sale referred to TCT No. T-62096 as its subject; while the be, between the parties and their successors in interest, no
petitioners Deeds of Voluntary Land Transfer referred to TCT No. T- evidence of such terms other than the contents of the written
62836 as its subject, which is further described as located in agreement.[43]
Barangay Murong.
Section 13. Interpretation according to circumstances. For the Aside from respondents neglect of their alleged ownership rights
proper construction of an instrument, the circumstances under over the Murong property, there is one other circumstance that
which it was made, including the situation of the subject thereof convinces us that what respondents really repurchased was the
and of the parties to it, may be shown, so that the judge may be Lantap property. Respondent Nemi (husband of respondent Elenita)
placed in the position of those whose language he is to interpret. is the farmer actually tilling the Lantap property, without turning
over the supposed landowners share to RBBI. This strongly indicates
that the respondents considered themselves (and not RBBI) as the
Applying the foregoing guiding rules, it is clear that the Deed of Sale owners of the Lantap property. For if respondents (particularly
was intended to transfer the Lantap property to the respondents, spouses Elenita and Nemi) truly believed that RBBI retained
while the VLTs were intended to convey the Murong property to the ownership of the Lantap property, how come they never complied
petitioners. This may be seen from the contemporaneous and with their obligations as supposed tenants of RBBIs land? The
subsequent acts of the parties. factual circumstances of the case simply do not support the theory
propounded by the respondents.
Third issue We are likewise convinced that the subject of the Deeds of
Determining the intention of the parties Voluntary Land Transfer (VLTs) in favor of petitioners was the
WHEREFORE, the Petition for Review on Certiorari is GRANTED. The Petitioner Ramon Lequin, husband of petitioner Virginia Lequin, is
assailed October 7, 2003 Decision, as well as the May 11, 2005 the brother of respondent Salome L. Vizconde and brother-in-law of
Resolution of the Court of Appeals in CA-G.R. SP No. 69981 are respondent Raymundo Vizconde. With this consanguine and affinity
REVERSED and SET ASIDE.The January 17, 2001 Decision of the relation, the instant case developed as follows:
DARAB Central Office is REINSTATED. The Deed of Sale dated
February 26, 1985 between respondents and Rural Bank of In 1995, petitioners, residents of Diamond Court, Brixton Ville
Bayombong, Inc. covers the Lantap property under TCT No. T-62836, Subdivision, Camarin, Caloocan City, bought the subject lot
while the Deeds of Voluntary Land Transfer and TCT Nos. CLOA-395 consisting of 10,115 square meters from one Carlito de Leon (de
and CLOA-396 of the petitioners cover the Murong property under Leon). The sale was negotiated by respondent Raymundo Vizconde.
TCT No. T-62096. The Register of Deeds of Nueva Vizcaya is directed The subject lot is located near the Sto. Rosario to Magsaysay road in
to make the necessary corrections to the titles of the said properties Aliaga, Nueva Ecija. Adjacent thereto and located in between the
in accordance with this Decision. Costs against respondents. subject lot and the road is a dried up canal (or sapang patay in the
SO ORDERED. native language).
LEQUIN v SPS. VIZCONDE
DECISION In 1997, respondents represented to petitioners that they had also
VELASCO, JR., J.: bought from Carlito de Leon a 1,012-square meter lot adjacent to
petitioners property and built a house thereon. As later confirmed
The Case by de Leon, however, the 1,012-square meter lot claimed by
respondents is part of the 10,115-square meter lot petitioners
This is an appeal under Rule 45 from the Decision[1] dated July 20, bought from him. Petitioners believed the story of respondents,
2006 of the Court of Appeals (CA) in CA-G.R. CV No. 83595, which since it was Raymundo who negotiated the sale of their lot with de
declared the Kasulatan ng Bilihang Tuluyan ng Lupa[2] (Kasulatan) Leon. With the consent of respondents, petitioners then
valid as between the parties, but required respondents to return the constructed their house on the 500-square meter half-portion of the
amount of PhP 50,000 to petitioners. Also assailed is the March 30, 1,012 square-meter lot claimed by respondents, as this was near the
2007 CA Resolution[3] denying petitioners motion for road.Respondents residence is on the remaining 512 square meters
reconsideration. of the lot.
This prompted petitioners to look into the ownership of the dried 2. Ordering the defendants:
up canal and the 1,012 square-meter lot claimed by respondents.
Carlito de Leon told petitioners that what he had sold to (a) to return to the plaintiffs the amount of FIFTY THOUSAND PESOS
respondents was the dried up canal or sapang patay and that the which they have paid in the simulated deed of sale plus an interest
1,012-square meter lot claimed by respondents really belongs to of 12% per annum to commence from the date of the filing of this
petitioners. case;
Thus, on July 13, 2001, petitioners filed a Complaint[4] for (b) To pay the plaintiffs moral damages in the amount of
Declaration of Nullity of Contract, Sum of Money and Damages Php50,000.00;
against respondents with the Regional Trial Court (RTC), Branch 28
in Cabanatuan City, praying, among others, for the declaration of (c) To pay exemplary damages of Php50,000.00;
SO ORDERED.[6]
In reversing and vacating the RTC Decision, the CA found no
simulation in the contract of sale, i.e., Kasulatan. Relying on Manila
The RTC found the Kasulatan allegedly conveying 512 square meters Banking Corporation v. Silverio,[8] the appellate court pointed out
to respondents to be null and void due to: (1) the vitiated consent of that an absolutely simulated contract takes place when the parties
petitioners in the execution of the simulated contract of sale; and do not intend at all to be bound by it, and that it is characterized by
(2) lack of consideration, since it was shown that while petitioners the fact that the apparent contract is not really desired or intended
were ostensibly conveying to respondents 512 square meters of to produce legal effects or in any way alter the juridical situation of
their property, yet the consideration of PhP 15,000 was not paid to the parties. It read the sale contract (Kasulatan) as clear and
them and, in fact, they were the ones who paid respondents PhP unambiguous, for respondents (spouses Vizconde) were the buyers
50,000. The RTC held that respondents were guilty of fraudulent and petitioners (spouses Lequin) were the sellers. Such being the
misrepresentation. case, petitioners are, to the CA, the owners of the 1,012-square
meter lot, and as owners they conveyed the 512-square meter
Aggrieved, respondents appealed the above RTC Decision to the CA. portion to respondents.
The Ruling of the CA The CA viewed petitioners claim that they executed the sale
contract to make it appear that respondents bought the property as
The appellate court viewed the case otherwise. On July 20, 2006, it mere gratuitous allegation. Besides, the sale contract was duly
rendered the assailed Decision granting respondents appeal and notarized with respondents claiming the 512-square meter portion
declaring as valid the Kasulatan. The fallo reads: they bought from petitioners and not the whole 1,012-square meter
lot as alleged by petitioners.
WHEREFORE, premises considered, the Appeal is GRANTED. The
Kasulatan ng Bilihang Tuluyan dated February 12, 2000 is declared Moreover, the CA dismissed allegations of fraud and machinations
valid. However, Spouses Raymundo Vizconde and Salome Lequin against respondents to induce petitioners to execute the sale
contract, there being no evidence to show how petitioners were
From the above considerations, we conclude that the appellate Tolentino defines fraud as every kind of deception whether in the
courts finding that there was no fraud or fraudulent machinations form of insidious machinations, manipulations, concealments or
employed by respondents on petitioners is bereft of factual misrepresentations, for the purpose of leading another party into
evidentiary support. We sustain petitioners contention that error and thus execute a particular act.[14] Fraud has a determining
respondents employed fraud and machinations to induce them to influence on the consent of the prejudiced party, as he is misled by
enter into the contract of sale. As such, the CAs finding of fact must a false appearance of facts, thereby producing error on his part in
give way to the finding of the trial court that the Kasulatan has to be deciding whether or not to agree to the offer.
annulled for vitiated consent.
One form of fraud is misrepresentation through insidious words or
Anent the first main issue as to whether the Kasulatan over the 512- machinations. Under Art. 1338 of the Civil Code, there is fraud
square meter lot is voidable for vitiated consent, the answer is in when, through insidious words or machinations of one of the
the affirmative. contracting parties, the other is induced to enter into a contract
which without them he would not have agreed to. Insidious words
A contract, as defined in the Civil Code, is a meeting of minds, with or machinations constituting deceit are those that ensnare, entrap,
respect to the other, to give something or to render some trick, or mislead the other party who was induced to give consent
service.[12] For a contract to be valid, it must have three essential which he or she would not otherwise have given.
elements: (1) consent of the contracting parties; (2) object certain
which is the subject matter of the contract; and (3) cause of the Deceit is also present when one party, by means of concealing or
obligation which is established. omitting to state material facts, with intent to deceive, obtains
consent of the other party without which, consent could not have
Section 9 of Rule 130 of the Revised Rules on Evidence gives both Moreover, the evidence of petitioners was uncontroverted as
the general rule and exception as regards written agreements, thus: respondents failed to adduce any proof that they indeed paid PhP
15,000 to petitioners. Indeed, having asserted their purchase of the
SEC. 9. Evidence of written agreements.When the terms of an 512-square meter portion of petitioners based on the Kasulatan, it
agreement have been reduced to writing, it is considered as behooves upon respondents to prove such affirmative defense of
containing all the terms agreed upon and there can be, between the purchase. Unless the party asserting the affirmative defense of an
parties and their successors in interest, no evidence of such terms issue sustains the burden of proof, his or her cause will not succeed.
other than the contents of the written agreement. If he or she fails to establish the facts of which the matter asserted
is predicated, the complainant is entitled to a verdict or decision in
However, a party may present evidence to modify, explain or add to his or her favor.[16]
the terms of the written agreement if he puts in issue in his
pleading: In the instant case, the record is bereft of any proof of payment by
respondents and, thus, their affirmative defense of the purported
(a) An intrinsic ambiguity, mistake or imperfection in written purchase of the 512-square meter portion fails. Thus, the clear
agreement; finding of the trial court:
(b) The failure of the written agreement to express the true intent
and agreement of the parties thereto; 2. x x x [I]t was established by the plaintiffs [petitioners] that they
(c) The validity of the written agreement; or were the ones who paid the defendants the amount of FIFTY
(d) The existence of other terms agreed to by the parties or their THOUSAND PESOS (Php50,000.00) and execute a deed of sale also
successors in interest after the execution of the written agreement. in favor of the defendants. In a simple logic, where can you find a
contract that a VENDOR will convey his real property and at the
The term agreement includes wills. same time pay the VENDEE a certain amount of money without
The second exception provided for the acceptance of parol evidence receiving anything in return?[17]
applies to the instant case. Lack of consideration was proved by