Facts:

The case involves Edilio L. Baluyot (petitioner) opposing the Court of Appeals and others (respondents). The events leading to the case began on May 18, 1954, when Simeon Salvador filed an action in the Court of First Instance of Rizal against Oscar Pajares and others, seeking the recovery of ₱2,500.00, plus interest, for extra labor and materials used in constructing Pajares's house. Salvador argued that these extra resources were necessary due to changes Pajares ordered in the construction plans. Pajares, while admitting alterations were made, contended that Baluyot was the real contractor responsible for the construction, effectively acting as Salvador’s dummy. To ensure any claims he had against Baluyot could be addressed, Pajares filed a third-party complaint against Baluyot, which the trial court admitted despite Salvador’s opposition. On August 5, 1955, the trial court issued a judgment in favor of Pajares, ordering Baluyot and Salvador to pay him various amounts, inc

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Facts:

Background of the Case

• Simeon Salvador filed an action on May 18, 1954, in the Court of First Instance of Rizal, seeking recovery of P2,500.00 plus interest.
• The claimed amount represented the extra labor and materials used in the construction of a house belonging to Oscar Pajares.
• Salvador’s claim arose from the necessity to provide additional labor and materials due to alterations and changes in the original plan and specifications ordered by Pajares.

Involvement of the Real Contractor and Third Party

• Oscar Pajares, in his answer, averred that the deviations from the original plan were executed at the behest of Edilio L. Baluyot, whom he alleged was the real contractor.
• As a result, Pajares moved to include Baluyot as a party defendant through a third party complaint.
• The third party complaint was admitted by the trial court, despite Salvador’s opposition, to ensure that all claims arising out of the single contract could be resolved in one judicial proceeding.

Trial Court Decision and Award

• On August 5, 1955, the trial court rendered a decision which:
• Ordered a judgment in favor of defendant and third-party plaintiff Oscar Pajares against plaintiff Simeon Salvador and third-party defendant Edilio L. Baluyot.
• Stipulated that Salvador and Baluyot jointly and severally pay:
• P700.00 representing expenses on the cement foundation;

ii. P1,390.00 as reasonable expenses required to complete the construction; iii. P2,000.00 for attorney’s fees for Atty. Victoriano Yamson; iv. A penalty of P5.00 per day for failure to finish the construction timely (from July 28, 1953, until completion and issuance of a building certificate);

Appellate Review and Points of Error Raised by Petitioner

• The Court of Appeals affirmed the trial court’s decision in toto.
• Edilio L. Baluyot, as the petitioner, raised several points of error, including:
• The propriety of admitting the third party complaint.
• The contention that he was unduly deprived of his full day in court due to the admission of the third party complaint.
• The upholding of the trial court’s award for expenses on the cement foundation (P700.00) and the reasonable expenses to complete the construction (P1,390.00).
• The validation of the trial court’s award of attorney’s fees (P2,000.00), the stipulated daily penalty (P5.00), and the award for moral and exemplary damages (P2,000.00).

Issue:

• Whether the admission of the third party complaint against Edilio L. Baluyot was proper and in conformity with the Rules of Court, considering that the construction dispute arose from one single contract.
• Whether Baluyot was unduly deprived of his full day in court due to an objection ruling during cross-examination, thus affecting his ability to present evidence adequately.

Whether it was proper to sustain the trial court’s decision ordering Baluyot to pay:

• P700.00 for the expenses on the cement foundation;
• P1,390.00 for reasonable expenses required to complete the construction, based on the evaluation of evidence provided by a building inspector and testimony of a commissioner.

Whether the trial court correctly awarded:

• Attorney’s fees amounting to P2,000.00;
• A daily penalty of P5.00 for delay in completion;
• Moral and exemplary damages in the amount of P2,000.00, in light of the requirement of showing bad faith or egregious conduct on the part of Baluyot.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)