G.R. No. L-37632 - Vda. de Paman vs. Seneris

Case Digest (G.R. No. L-37632)
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Facts:

Contract and Construction Agreement

On January 19, 1996, Gregorio Silot, Jr. (petitioner) and Estrella de la Rosa (respondent) entered into a contract for the construction of a dormitory-apartment building on Lot 1-A-9-D, Bagumbayan Sur, Naga City.
The contract explicitly provided that Silot would supply the labor, while De la Rosa would pay 33% of the total value of the materials purchased for the construction project.

Completion and Dispute Over Payment

Upon turnover of the completed structure in February 1997, the total cost of materials purchased was P2,504,469.65.
Thirty-three percent (33%) of this amount equals P826,474.98, which represented De la Rosa’s agreed contribution. However, Silot required De la Rosa to pay a total of P1,018,000.00, thus demanding P191,525.02 in excess of the agreed amount.
De la Rosa, through her son-in-law, confronted Silot about the alleged overpayment, but Silot refused to refund the excess amount.
After repeated demands were ignored, De la Rosa filed a suit against Silot for the return of the excess payment.

Silot’s Counterclaim and Consolidation of Cases

In retaliation, Silot filed a counterclaim asserting insufficient payment, stating that he was supposed to receive P1,281,872.40 for labor rendered but was only paid P1,008,000.00, leaving an alleged balance of P273,872.40.
The two cases were consolidated by the Regional Trial Court (RTC), Branch 61, Naga City.

Trial Proceedings and Admission by Counsel

During trial, Atty. San Jose, counsel for Silot, waived the testimony of Ariel Goingo, a material witness for De la Rosa.
Atty. San Jose admitted, as a judicial admission, the contents of Goingo’s proposed testimony that:

All material supplies during additional works were covered in the 33% payment stipulated in the contract.
Silot was paid for all work and materials supplied.
The total materials cost was P2,504,469.65; 33% of which is P826,474.98.
De la Rosa paid P1,018,000.00; thus, an overpayment of P191,525.02 exists.
De la Rosa was never confronted by Silot for any additional payment demand.

RTC Decision

The RTC dismissed Silot’s claim for additional payment for lack of merit.
The RTC ordered Silot to return P191,525.02 to De la Rosa, and awarded P100,000.00 as attorney’s fees and P50,000.00 as nominal damages.

Court of Appeals Ruling

The Court of Appeals affirmed the RTC decision with modification:

Deleted the award for nominal damages.
Reduced attorney’s fees to P20,000.00.

Other awards not modified were upheld.

Silot’s Petition for Review

Silot petitioned the Supreme Court assigning errors:

The Court of Appeals erred in construing his counsel’s admission on Goingo’s proposed testimony as a judicial admission of evidence.
The appellate court erred in ordering him to return P191,525.02 and to pay attorney’s fees.

Issues:

Whether the admission made by Silot’s counsel, Atty. San Jose, regarding the proposed testimony of witness Ariel Goingo, constituted a judicial admission binding on Silot.

Whether the appellate court erred in ruling that Silot must return the amount of P191,525.02 representing overpayment to De la Rosa.

Ruling:

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Ratio:

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Doctrine:

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