Case Digest (G.R. No. 150731)
Facts:
In 1984, Casent Realty Development Corporation executed two promissory notes in favor of Rare Realty Corporation, namely PN No. 84-04 for ₱300,000 at 36% interest per annum and 12% penalty if unpaid by June 27, 1985, and PN No. 84-05 for ₱681,500 at 18% interest per annum and 12% penalty if unpaid by June 25, 1985. On August 8, 1986, Rare Realty assigned these notes to Philbanking Corporation by a Deed of Assignment. Despite repeated demands, Casent failed to pay, and by July 15, 1993, its obligation allegedly grew to ₱5,673,303.90. Philbanking filed a collection complaint on July 20, 1993, before the Makati RTC. In its Answer, Casent raised affirmative defenses—including estoppel, statute of limitations, payment, and a Dacion en Pago of its Iloilo property dated August 27, 1986—and attached a Confirmation Statement of April 3, 1989 showing no outstanding loans as of December 31, 1988. Casent also counterclaimed for overpayment and damages. After respondent rested, Casent movedCase Digest (G.R. No. 150731)
Facts:
- Promissory Notes Execution and Terms
- In 1984, Casent Realty Development Corporation (“petitioner”) executed two promissory notes in favor of Rare Realty Corporation (“Rare Realty”):
- PN No. 84-04 for ₱300,000, 36% interest per annum, 12% penalty after June 27, 1985
- PN No. 84-05 for ₱681,500, 18% interest per annum, 12% penalty after June 25, 1985
- On August 8, 1986, Rare Realty assigned both notes to Philbanking Corporation (“respondent”) via Deed of Assignment.
- Demand, Complaint, and Amount Claimed
- Respondent alleged petitioner’s failure to pay upon maturity, accruing to ₱5,673,303.90 by July 15, 1993.
- On July 20, 1993, respondent filed a collection complaint before Makati RTC (Civil Case No. 93-2612).
- Answer and Affirmative Defenses
- Petitioner’s Answer raised:
- Lack of cause of action; estoppel; statutes (frauds, limitations); laches; payment/release
- Dacion en Pago (Aug 27, 1986) conveying an Iloilo property to extinguish a ₱3,921,750 loan
- Confirmation Statement (Apr 3, 1989) showing no outstanding bank loans as of Dec 31, 1988
- Estoppel due to respondent’s capital stock reduction in Oct 1988
- Compulsory counterclaim for overpayment (~₱4 million), moral/exemplary damages, attorney’s fees (~₱4.5 million)
- Trial Court Proceedings
- Respondent presented evidence; petitioner moved for judgment on demurrer to the evidence.
- On May 12, 1999, RTC granted the demurrer, holding the Dacion en Pago extinguished petitioner’s obligation and dismissed the complaint with prejudice.
- Court of Appeals Decision
- Respondent appealed; CA held that the promissory notes were not covered by the Dacion; petitioner’s defenses were improperly excluded.
- On March 29, 2001, CA reversed RTC and ordered petitioner to pay:
- ₱300,000 plus 36% interest p.a. and 12% penalty (PN No. 84-04)
- ₱681,500 plus 18% interest p.a. and 12% penalty (PN No. 84-05)
- 25% of total due as attorney’s fees
- Petitioner’s motion for reconsideration was denied on November 7, 2001.
Issues:
- Whether the CA erred in excluding petitioner’s affirmative defenses in resolving a demurrer to evidence.
- Whether petitioner is liable to pay respondent under the assigned promissory notes.
- Whether respondent’s failure to deny the Dacion en Pago and Confirmation Statement under oath constituted judicial admissions.
- Whether judicial admissions should be considered in a demurrer to evidence and if they warrant dismissal of the complaint.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)