Facts:

This case involves a petition for review filed by See Ban (petitioner) against the Intermediate Appellate Court, the Regional Trial Court of Manila, Branch XI, and Lu It (respondents) for the affirmation of a lower court's decision. The events stemmed from a business relationship that turned contentious, culminating in a civil suit. On October 7, 1980, the Regional Trial Court ruled in favor of Lu It, ordering See Ban to pay P15,700.00, with legal interest from the date of filing the complaint, and an additional 10% of the amount due as attorney's fees. The decision stemmed from claims that See Ban, a businessman, borrowed a total of P16,750.00 from Lu It, a close friend, during the period from April to June of 1975. The borrowed money was intended to settle See Ban's gambling debts, primarily incurred from participating in mahjong games organized by Lu It. Despite acknowledging the debt during a meeting facilitated by Judge Ernesto A. Madamba, See Ban defaulted on h

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Facts:

Parties and Background

• Petitioner: See Ban (defendant-appellant)
• Respondents:
• The Intermediate Appellate Court (formerly the Court of Appeals in the relevant case)
• The Regional Trial Court of Manila, Branch XI
• Private respondent Lu It
• Nature of the dispute: A collection suit arising from alleged borrowings by See Ban from Lu It, purportedly to pay off gambling debts incurred during mahjong sessions.

Transaction and Alleged Borrowings

• Between April 6, 1975 and June 29, 1975, defendant-appellant allegedly borrowed various amounts totalling P16,750.00.
• The borrowed funds were used by See Ban to settle his gambling losses against other players.
• Defendant made a partial repayment of P1,050.00, leaving an outstanding balance of P15,700.00.
• Defendant’s repeated denials of the borrowings were countered by admissions obtained in a meeting.

Admissions and Witness Testimonies

• In a December 1977 meeting at the defendant’s business establishment in Binondo:
• Plaintiff-appellee (Lu It) accompanied by Judge Ernesto A. Madamba and Jose Palanca, approached the defendant.
• In the presence of these individuals, the defendant acknowledged his indebtedness and promised payment.
• Judge Madamba, who had a long-standing personal relationship with the plaintiff, testified regarding the admission of debt by See Ban.
• Private respondent Lu It, despite being the operator of an unlicensed gambling establishment, testified on the transactions and the circumstances of the lending.

Procedural History and Lower Court Rulings

• The Court of First Instance of Manila, Branch XI, rendered a decision on October 7, 1980:
• Ordering See Ban to pay the plaintiff the amount of P15,700.00 with legal interest from the filing of the complaint.
• Dismissing the defendant’s counterclaim for lack of merit.
• On appeal, the Intermediate Appellate Court (IAC) affirmed in toto the findings of the trial court.
• A subsequent motion for reconsideration by the petitioner was denied by the IAC on January 12, 1984.

Defendant’s Arguments and Evidentiary Issues

• See Ban contested the credibility and reliability of:
• The testimony of private respondent Lu It, an operator of a gambling house.
• The testimony of Judge Madamba, his friend and the verifying witness of the admission.
• The defendant argued that his possession of a bank deposit and business solvency indicated no need to borrow money.
• He further contended that if borrowings had occurred, they should have been offset against rental fees related to the use of the premises.
• The defense also posited that the indebtedness should be deemed a "gambling debt" which, under Art. 2014 of the Civil Code, cannot be legally collected.

Additional Contextual Facts

• Plaintiff-appellee was a businessman who organized regular mahjong sessions.
• Lu It, besides acting as a lender, was also known for managing a gambling den where mahjong games were held.
• The operational details of the gambling den were used by the petitioner to dispute the credibility of Lu It’s statements.
• Despite these challenges, the evidence showed that the defendant’s need for immediate cash, even with his bank deposits, could plausibly result in borrowing to cover short-term obligations from gambling losses.

Issue:

• Whether the trial court and the Intermediate Appellate Court properly accorded credibility to the testimonies of key witnesses, particularly private respondent Lu It and Judge Ernesto A. Madamba.
• Whether the evidence sufficiently establishes that the defendant, See Ban, indeed incurred a debt amounting to P16,750.00 as a result of borrowing money to settle gambling losses.
• Whether the characterization of the debt as non-gambling in nature (thus making it legally collectible) was correct, despite the defendant’s contention that the indebtedness should be regarded under the provisions of Art. 2014 of the Civil Code.
• Whether the trial court’s evaluation of the evidence and witness credibility should be disturbed on appeal in light of the defendant’s arguments concerning inconsistencies and alternative explanations such as his bank deposits.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)