Prof. V. A.

Avena Evidence
Best Evidence Rule AIR FRANCE vs. CARRASCOSO 18 SCRA 155 SANCHEZ; Sep 28, 1966 (athe) NATURE: Review on certiorari FACTS Carrascoso, a civil engineer, was a member of a group of 48 Filipino pilgrims that left Manila for Lourdes on March 30, 1958. On March 28, 1958, the defendant, Air France, through its authorized agent, Philippine Air Lines, Inc., issued to plaintiff a 'first class' round trip airplane ticket from Manila to Rome. From Manila to Bangkok, plaintiff traveled in 'first class', but at Bangkok, the Manager of the defendant airline forced plaintiff to vacate the 'first class' seat that he was occupying because, in the words of the witness Ernesto G. Cuento, there was a 'white man', who, the Manager alleged, had a 'better right to the seat. When asked to vacate his 'first class' seat, the plaintiff, as was to be expected, refused, and told defendant's Manager that his seat would be taken over his dead body; a commotion ensued; plaintiff reluctantly gave his 'first class' seat in the plane. After transferring to the tourist class seat, one flight attendant approached him and requested from him his ticket and said that she will note of his transfer. He refused because for him it is tantamount to accepting his transfer. Later, he went to the pantry that was next to him and the purser was there. He told him that he recorded the incident in his notebook. He read it and translated to him because it was recorded in French. "First class passenger was forced to go to the tourist class against his will, and that the captain refused to intervene." Carrascoso, during trial, included this incident in his testimony. ISSUES 1. WON Carrascoso was entitled to the first class seat he claims incompetent, therefore not admissible (because the defendant was saying that the best evidence in this case is the entry and not the testimony) HELD 1. YES. The testimony of the defendants witnesses that the issuance of first class ticket was no guarantee that the passenger would have a first class ride, but such would depend upon the availability of first class seat cannot hold water. Oral evidence cannot prevail over written evidence, in this case, the first class tickets of the plaintiff without any reservation whatever and even marked with OK, meaning confirmed. 2. NO. The subject of inquiry is not the entry, but the ouster incident. Testimony of the entry does not come within the proscription of the best evidence rule. Such testimony is admissible. Besides, from a reading of the transcript just quoted, when the dialogue happened, the impact of the startling occurrence was still fresh and continued to be felt. The excitement had not as yet died down. Statements then, in this environment, are admissible as part of the res gestae. For, they grow "out of the nervous excitement and mental and physical condition of the declarant". The utterance of the purser regarding his entry in the notebook was spontaneous, and related to the circumstances of the ouster incident. Its trustworthiness has been guaranteed. It thus escapes the operation of the hearsay rule. It forms part of the res gestae. Moreover, if it were really true that no such entry was made, the deposition of the purser could have cleared up the matter. DISPOSITION: Decision of CA affirmed. HERNAEZ v McGRATH TUASON; July 9, 1952 G.R. No. L-4044 (jojo) NATURE On action of ejectment and for damages commenced in the CFI of Manila by Pedro C. Hernaez and Asuncion de la Rama Vda. de Alunan, in her own behalf and as an administratix of the estate of her deceased husband, Rafael R. Alunan, against the Philippine Alien Property Administration (PAPA).

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2.

WON the CA erred in finding that the purser madean entry in his notebooks reading "First class passenger was forced to go to the tourist class against his will, and that the captain refused to intervene" is predicated upon evidence which is

FACTS Rafael Alunan and Pedro Hernaez formerly were registered owners in equal share of a land, 8 contiguous parcels with a combined area of 4,533.34 sqm covered by TCT Nos. 46872-46880 and situated in the corner of Cortabitarte and Dewey Boulevard, Manila. 8 residential houses were built on these lots but they were destroyed by war operations in the early part of 1945. In Feb. 1943, a deed of sale, on which Alunan's and Hernaez names were signed as sellers and the Hakodate Dock Co., Ltd., a Japanese commercial firm, as buyer, in consideration of P170,000, was presented for registration in the office of register of deeds, and on March 3, TCT Nos. 66832-66839 in the name of the purchaser were issued in lieu of the old CT Nos. 5393053938, which were totally cancelled. On the strength of this registration,the lots and all improvements still existing thereon were vested as property of an enemy national by the PAPA, a US Government instrumentality, In April 1947, under the authority of the US Trading with the Enemy Act, as amended, the Philippine Property Act of 1946, and Executive Order No. 9818. - The RP as the transferee of the property in litigation came into the case as intervenor on the side of the defendant. Dr. Nicanor Jacinto also filed a complaint in intervention but in opposition to the defendant as well as the plaintiffs. The questioned property has been mortgaged to Jacinto before the outbreak of the war to secure a promissory note for P160,000, and although the mortgage had been paid and cancelled in 1943, Dr. Jacinto alleged that he had accepted the payment and agreed to the cancellation in fear of Japanese reprisal. The issue was complicated by the theft after liberation from the office of the register of deeds, of the deed of sale, the transfer certificates of title by virtue thereof, and other papers pertaining to the last registration. The plaitiffs representation made determined and repeated efforts to block the attempts of appellants any oral evidence touching on the alleged contents of the documents supposedly executed by Alunan and Hernaez in favor of the Hakodate, which efforts were futile. As maters stand, only one unsigned copy of the aforesaid deed, which had been secured from the file of the Hakodate home office in Hokaido, Japan, was introduced. Hakodate's signed copy is said to have

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been lost or destroyed in the bombing of Tokyo in 1945 along with the company's office in that city. And the copy or the copies which had been kept by the notary public before whom the document was acknowledged had also been burned with his other papers during the fight for liberation of Manila. As a result, defendant's proofs on the controverted execution of the lost deed are only the entries thereof in the registrar's office, collateral documents, and parol testimony, some direct, some circumstantial, but none precise or unequivocal in term. - Hernaez was the lone witness on his behalf and for his co-plaintiff. The gist of Hernaez' testimony is that if any document was presented the register of deeds' office purporting to have been executed by him and his co-owner, that document was a forgery. Hernaez in part declared: "We were forced by the Japanese to vacate the houses. They told me they needed the property and I had to cooperate, collaborate with them and I had no other alternative but to sell my property. They detained at the Port Area until midnight; it was midnight when they sent me back to my house but they retained the titles. I think there were eight titles. They told me that I had to sign the deed of sale. I had been expecting that they will appear there to make me sign the deed of sale in my house or in the office of the Navy at Legaspi Landing, but what happened is that they did not appear in my house, and afterwards I found out that Captain Tanabe (Watanabe, Hakodate's manager) was sent back to Tokyo." The principal witness for the defendant on the dispute sale were Satoru Watanabe, Napoleon Garcia and Jose Ma. Recto. - Watanabe: testifies that he was in the Philippines in the early part of the war as acting manager of the Manila Branch of the Hakodate Dock. Co., Ltd; that he knew Hernaez and Alunan. He recalls the transaction between the Hackodate Dock Co., Ltd., on the one hand and Hernaez and Alunan on the other, concerning the sale of the land and buildings located at the corner of Cortabitarte and Cavite (Dewey) Boulevard. He says that the deed of sale was prepared in Doctor Recto's office but he was not present having gone to that office only after he had been informed that the document was ready; that after he had been assured that the document was complete, he affixed his signature thereto; that according to his memory he was asked to sign the document after the vendors, Alunan and Hernaez, had signed it; that as he left Manila for Japan shortly after he had signed the deed of sale, he does not know what happened to the copy of said document which was delivered to Hakodate Dock. Ltd., that after he had returned to Tokyo, the document was forwarded to the Tokyo office, at the beginning of the following year; that the duplicate original and the unsigned copies thereof were kept in the Tokyo office; that the duplicate original was burned when the Tokyo office was bombed by the United States Airforce in 1945, but that a copy (made by the Hakodate Manila office) of the duplicate original which was kept by the Manila Branch office was not destroyed and he brought it along when he came to the Philippines to testify; that he saw that copy of the first time in the Hokaido office of the Hakodate Dock Co. when he went there before coming to the Philippines. - Garcia, an assistant in the office of Atty. Recto, declares that he was a notary public and recall that, as such, he ratified a document in which Alunan and Hernaez and the Hakodate Dock. Ltd., were the parties; and all the notarial copies were lost or destroyed; that he made at least five copies of which he retained two and handed over the rest and the original to the parties; that Hakodate at least received one copy. He says he did not remember to whom he delivered the original. On cross-examination by the attorney for Dr. Jacinto, Garcia says that he does not know who engaged his firm; he only knows that Recto requested him to notarize the document. Nevertheless he recalls that the vendors were Hernaez and Alunan and the vendee the Hakodate Dock. Ltd, He says that the documents were signed in his presence and that he must have given Alunan or Hernaez a copy. He further says he cannot exactly tell where the document was ratified but that it must have been either in his office or in the office of the parties whether he went with his notarial equipment. He thinks he says, that he went to the office of Secretary Alunan in the old legislative building. - Recto: testifies that during the Japanese occupation his law office was on the 3rd floor of the Soriano Building. He recalls a transaction between Alunan and hernaez on the one hand and the Hakodate Dock. Ltd., on the other. He thinks that he drew a deed of sale and that the document was signed in his office; that he was in the same room. He was asked if he was one of the witnesses to the document but the question was objected to and the objection was sustained. He further declares that he took charge of registering the deeds of

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sale and that after the registration he succeeded in getting the certificates of title in the name of the vendee and delivered them to the latter. He says he did not remember if his firm was the retained the counsel for the Hakodate Dock Co., nor is he sure where the transaction took place. He would not be able to identify the document if only a copy thereof was shown to him. He states that he does not remember if the transaction was a sale; all he remembers is that it was a transaction between Hernaez and Alunan and the Hakodate Doc Ltd., and the papers were signed at his office at the Soriano Building by alunan and Hernaez, as afar as he can recall. He recalls another transaction of Hakode in which the preparation of the document was more or less entrusted to him by the Hakodate Dock Co. He says that he was informed by Messrs. Hernaez and Alunan regarding the transaction that there had been an argument between them. The trial Judge did not make express findings on Watanabe's credibility, and referring to Garcia's and Recto's testimony, noting that the same are beclouded with the phrases "it could have been", "it must have been signed, in his presence". Moreover, the judge insinuated that Hakodate's signed copy existed at the time of the trial and had been suppressed, and acting on this belief, disregarded all parol evidence by which the defendant had attempted to establish the genuineness of the deal. Said the court: There is no sufficient evidence on record to show the loss of all the signed copies of the questioned document. Loss of the original and the signed copies must be satisfactorily established before secondary evidence can be admitted. Specially when the signatures on the document is claimed to have been forged, it becomes absolutely necessary and indispensable the production on original or a signed copy of the document. Thus, no secondary evidence can be entertained to prove the document of the lost document, especially if the supposed document is contested to be falsified of forged. RTC ruled in favor of the plaintiffs and dismissed the complaints in intervention. ISSUE WON the signatures of Alunan and Hernaez on the deed of sale are authentic HELD YES

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- No valid ground can be perceived for the insinuation that the defendant or the Hakodate Dock Co. concealed any of the signed copies of the disputed deed. It is highly inconceivable that the United States Government or the Philippine Government representatives would be capable or resorting to such dishonorable and shyster tactics in order to win the case and dispossess legitimate owners of their property. Much less can it be imagined that those representatives had a hand in the loss of pertinent papers in the register of deeds' office. It would have been nonsensical on their part to steal the very documents on which they based their action in vesting the property. As for Hakodate Dock Company, his firm had no interest in the result of the suit. It could not have entertained any hope of getting the property under any circumstances. Furthermore, Watanabe has no longer connected with Hakodate when he testified at the trial. Be that as it may, the court below was entirely mistaken in holding that parol evidence of the execution of the instrument was barred. The court confounded the execution and the contents of the document. It is the contents, which in this case are not in dispute, which may not be proved by secondary evidence when the instrument itself is accessible. Proofs of the execution are not dependent on the existence or non-existence of the document, and as a matter of fact, such proofs of the contents: due execution, besides the loss, has to be shown as foundation for the introduction of secondary evidence of the contents. Section 46 ROC: There can be no evidence of a writing other than the writing itself the contents of which is the subject of inquiry, except in the following cases: xxx xxx xxx Section 51 ROC: When the original writing has been lost or destroyed upon proof of its execution and loss or destruction, its contents may be proved by a copy, or by a recital of its contents in some authentic document, or by the recollection of witnesses. - Evidence of the execution of a document is, in the last analysis, necessarily collateral or primary. It generally consists of parol testimony or extrinsic papers. Even when the document is actually produced, its authenticity is not necessarily, if at all, determined from its face or recital of its contents but by parol evidence. At the most, failure to produce the document, when available to establish its execution may affect the weight of the evidence presented out not the admissibility of such evidence. In spite of the defects which the trial court noted in Garcia's and Recto's testimony, the same and Watanabe's leave little or no room for doubt that Alunan and her Hernaez did affix their signatures to the deed of sale. Hernaez' testimony which the trial court says "it finds no reason to doubt" actually has to many serious flaws to justify the court's faith. The testimony is highly improbable in many important respects and is directly or indirectly contradicted by evidence more trustworthy and by well-established facts. Without going to minute detail, the following considerations should suffice to illustrate the point. The evasive answers Hernaez in his crossexamination cast serious reflection on the truth of the protestations that the stolen document was forged. Hernaez did not have to be shown the deed to be able to tell that he had not signed it if that had been the case. The point sought by the questions was very specific and must have been uppermost in the witness mind. It was the thesis of his complaint and had been the subject of a prolonged investigation before the suit was filed. Dates and years and figures" "difficult to remember" had nothing to do with, and could not have obscured the right answer to the simple question whether Hernaez and Alunan had disposed of their property which they were trying to recover. In fact previously Hernaez and vehemently affirmed. "I never signed a deed of sale to any body, much less to Hakodate Dock Co." - One other notable feature of Hernaez' testimony is the absence therefrom of any reference to Alunan in connection with the alleged seizure of their houses and certificates of title. Although there is no proof on the record relative to Alunan's official position at the time other than that he had an office in the legislative building, the court may take judicial notice of the fact that Alunan was a member of the Executive Commission and later cabinet minister in the Japanese sponsored Government of the Philippines. The point is that if what Hernaez says were correct, it does not seem probable that Alunan would not have known the occurrence, and knowing it, taken steps to recover the seized titles or compensation for the property. It does not seem likely that he would not have at least complained to the Japanese higher authorities and

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secured some information about what we became of their certificates. Yet Hernaez would have the court believe, as we gather from his testimony, that neither he nor his partner learned of the whereabouts of their titles until after the Japanese had been driven away from the Philippines and that for the two years they allowed themselves to be deprived of the use of their property without protest. Let it be remembered that the property had not been taken by the armed forces for war purposes but by a private concern if attached to and operating under the supervision of the Japanese Navy. Contrary to Hernaez' assertions, Watanabe did not hold any military rank or status, and the houses and lots were used as quarters for the firm's civilian employees and acquired in the firm's name with its own money. The charge suggested by the line of plaintiff's evidence that the Hakodate Dock Co. resorted to frauds and coercion so as not to pay for the plaintiffs' land and houses is discredited by the fact that it settled the mortgage, paying an amount which was only P10,000 short of the purchase price. This payment bears witness to Hakodate's good faith and willingness to spend for what it got. At the same time, and this is more important to the immediate issue, it is mute testimony to the due execution of the sale by Alunan and Hernaez; for it is not logical to suppose that the Hakodate would have parted with a huge amount of cash, huge at the time, if the owners had not executed a valid deed of conveyance. Another idea that suggests itself is that the officers of the Hakodate, of the Hahodate, if they had a mind to commit frauds, would not have been chosen Doctor Jacinto for the victim of its felony in preference to a senator-elect, which Mr. Hernaez was, and a member of the Cabinet. To forge a deed of cancellation held by a private citizen who wielded no official influence would have been undoubtedly the easier and the risks of failure, not to say punishment, the lesser. The premise of his ratiocination is wrong in that Hernaez testified that he and no the Hakodate Dock Co. paid off the mortgage. However, the clear weight of the evidence both as to quality and the number of witnesses is against the plaintiffs. - Against the plaintiffs' evidence there is the testimony of Watanabe and Jacinto who said the payment was affected by the former, and of Recto and Garcia who said that the cancellation was arranged and perfected

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in their law office at the instance of the Hakodate representatives. - In contract, Hernaez said he did "not know who handled the cancellation," a matter which seemed too important not to be remembered, contenting himself with the statement that "The thing is that when he paid him (Jacinto) he gave us the release." And as to the place of cancellation, he said that it was somewhere on the Escolta, in the office of the law firm of Duran, Lim & Bausa, when, it is conclusively established, Attuy. Lim, who was Jacinto's attorney, and whom Hernaez apparently had in mind, separated from that firm as early as the beginning of the Japanese occupation in 1942, and, as a matter of fact, the cancellation was executed, as above, seen, in the Recto Law Office and not in the law office of Duran, Lim & Bausa. Note that the attesting witnesses to the cancellation were Napoleon Garcia and Jose Ma. Recto and the document was acknowledge before Garcia was notary public. - The fact that the deed of cancellation was made in the name of Alunan and Hernaez cannot be any means be taken as evidence of plaintiff's theory. The payment was in reality made in their name although the money came was received by the payee from Watanabe. For the purpose of registration, the deed of cancellation had to be deframed the way it was drawn. - The overwhelming preponderance of the evidence likewise discredits Hernaez' declaration that his and Alunan's certificates of title were in his possession. Jacinto said he had them, and it could not have been otherwise. It is the invariable and sensible practice of mortgagees to keep the title to the property mortgaged as a necessary measure of protection. In the testimony before the court (he had lenghtly testified before the claim committee of the PAPA Hernaez admitted that Doctor Jacinto did not depart from this practice. In answer to the court's question whether he turned over to Doctor Jacinto the said certificates when he executed the mortgage, he answered in the affirmative. How then could Hernaez have those certificates when he was allegedly carried to the Legaspi Landing where, he said, they were taken away from him? The deed of sale and the deed of cancellation were executed on the same date, February 20, and the genuineness of the latter deed is admitted. This being so, Hernaez could not have had the certificates of title and these could not have been taken away from him before that date. If it be asserted that the certificates might have been handed over to the Japanese on the same date the mortgage was cancelled and the cancellation was registered, the assertion would contradict Hernaez' testimony from which the clear inference is that he had the titles in his home for days or weeks before the Legaspi Landing incident. Besides, Watanabe and his attorneys and notary could not by any possibility have drawn or registered the deed of sale on the same date the certificates were returned to Hernaez to Doctor Jacinto. - One of the arguments advanced to drive home the point that the questioned sale was fake is that, it is said, Alunan and Hernaez did not have any need to sell this property. Moreover, it is alleged purchase price was far below its actual value. - Jacinto testified that having heard that the property in question was being sold to the Japanese, he immediately gave instructions to his then attorney, Manuel Lim, to see Alunan and Hernaez and offer in his behalf to buy it. And Atty. Lim, who was SolGen when he testified corroborated his former client, stating that about the end of 1942 or the early part of 1943, he requested Alunan to let Doctor Jacinto buy the said property, and proposed easy terms. He said that he called on Alunan twice or three times in the latter's office in the Legislative Building; that in the first visit Alunan said that he would consult with his partner, Senator Hernaez, and in the second, that he and his partner were still undecided, but remarked that he had received an offer from a Japanese firm and that he (Alunan) and Hernaez would prefer to make the sale of the Japanese. We have no reason to suspect the veracity at these witnesses. That Alunan and Hernaez were not averse to selling the property in question may be inferred from the plaintiffs' own evidence. Hernaez testified that he had sold to a Chinese in 1944 the land on Dewey Boulevard where the Riviera is now located, for P360,000 or P375,000 and a parcel, location not revealed, to Toyo Menka Kaisha for P40,000 "nearly the same time, March 1943," a lot by which the way, according to Hernaez he was also claiming from the PAPA. He also disclosed that he had "sold many jewelries, watches and other things," which goes to show that they were not oversupplied with cash. Of equal significance is the statement indicating that Hernaez and Alunan were engaged in real estate business. Hernaez stated, "We used to have here some properties that we sold on ten years installment before the war and after the war."

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In the matter of the value of the houses and lots registered by the Hakodate Dock Co., the trial court believed that the price stated in the deed was highly inadequate and regarded this alleged inadequate as supporting the contention that the sale was forged. The court seems to have overlooked the fact that the property sold to Hakodate Dock Co., was only eight parcels containing a total area of 4,533,34 square meters, whereas the property which the plaintiff had bought from Chuan & Sons for P185,000 and of which the property in questioned formed a part, measured 8,027.72 square meters. So that by selling the above portion of P170,000, they were able to recoup nearly all their investment, without counting the rents they had theretofore realized on the houses, and keep nearly one-half of their original acquisition as a clear profit. That was not a bad bargain. It is a matter of common knowledge that in February 1943 Japanese war notes were still about at par with the Commonwealth peso. The sale of the plaintiff's other land in Dewey Boulevard for a much higher price in proportion to its size took place in 1944, or in the latter part of 1943 at the earliest, when the Japanese war notes had been shipping down fast. At any rate, the proceeds of the sale were more than enough to liquidate their mortgage debt, the payment of which the purchaser took charge of attending to. As Hernaez said, "the thing is that when we paid him (Jacinto) he gave us the release." - For another thing, it is a mistake to take the alleged inadequacy of the price stated in the deed of evidence of forgery, for figures are easy to fabricate and a forger would endeavor to fix an amount in accord with the prevailing rates of real estate value precisely to forestall such suspicion as is put forward in this case. - The appealed decision says "another issue raised by the plaintiffs is the illegality of the alleged acquisition by the Hakodate Dock Co. Ltd., of the property under litigation, assuming that a contract was duly executed by Messrs. Alunan and Hernaez in favor of the said company," And citing Krivenco vs. Register of Deeds, the court concluded that the sale would be null and void any way. As the appellants have noted, nowhere in the pleadings did the plaintiffs impeach the validity of the sale to Hakodate Dock Co., on constitutional grounds. And even if they had, the present case would not be controlled by the doctrine laid down in the Krivenko case. The Philippine Constitution was not in force

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during the Japanese occupation of the Philippines. The constitution was inoperative at least with reference to Japanese citizens. Military Ordinance No. 2, promulgated on March 14, 1942, expressly excluded "Japanese subjects from the operation of prohibition and limitations on civil rights, benefits and privileges, which by reason, of their nationality are denied them by laws, statutes, administrative orders or regulations of the Philippines." There is no doubt about the rights under the international law of the belligerent occupants to issue this decree. - The court would also invalidate the sale on the theory "that the Hakodate Dock Co. Ltd., a purely Japanese concern, was never registered as such in the Philippines nor was it authorized to transact business in accordance with existing Philippine Corporation Law." This question, like the just discussed, has not been raised in the pleadings. What is more, we know of no law or provision of the Corporation Law which prohibits a business concern not authorized to transact business from buying or owning real property. As to counsel's observation that "there was no proof that Satoru Watanabe, who was then merely an acting Manila manager of the company, was duly authorized to represent said company," the defect if there was a defect was one which the only principal or the party for whom Watanabe purported to act could use to rescind the sale. - The probabilities of forgery are very remote and the direct evidence for the defendant has abundantly and convincingly established that the property was sold by its former owners for valuable consideration. The loss of the pertinent records in the office of the register of deeds cannot be availed of to bolster the plaintiffs' case or weaken the defense. If the loss is to produce any effect, the effect should be reverse, considering all circumstances surrounding the theft. Doctor Jacinto's case: Doctor Jacinto testified: He was paid the amount of the mortgage by a Japanese, who said that he represented the Hakodate Dock Co., at the beginning of 1943, and deposited the check, signed by a Japanese, in the Philippine Bank of Commerce. He executed a release of the mortgage because he was told by the Japanese, accompanied by a Filipino from the law firm of Mr. Recto that the document of cancellation was already prepared. He was informed that they had purchased the property for the Hakodate Dock Co. He was reluctant to sign the deed of cancellation because, in the first place, the amount did not cover the whole balance, and in the second place, it was not the money which he had loaned. When they noticed his reluctance they told him that he could be grateful because they could have taken the property without anything for it. The court can sympathize with the mortgagee and believe that at heart he was opposed to the payment of his credit in Japanese money and would not have rejected or protested against the payment if it had been tendered by the debtor directly. Under the applicable law and uniform decisions of this Court, however, the payment was enforceable irrespective of the attitude of the creditor. The debtor or his successorin-interest had the right to pay the mortgage in Japanese war notes, which were the authorized currency in circulation, not to say the only currency available. In other words, the payment would have released the mortgage even if it had been tendered by the mortgagor personally and had been turned down by the mortgagee. That was the unfortunate situation into which thousands of prewar creditors were thrust by the war, most of them being forced to accept Japanese military notes when these were little better than useless. - The disparity in value, if any, between Japanese war notes and the Philippine peso in February 1943 was not great, however. According to the Ballantyne conversion table, the exchange ratio between the two currencies in February 1943 was P1 to P1.10. It is to be kept in mind that the scale did not pretend to be exact. The ratio could have been still even. The belief is, perhaps, confirmed by the price of the absolute sale which was only P10,000 more than the mortgage debt. In any event, the mortgagee, whatever his feelings, did accept the payment, deposit the cash in the bank in current account, and could have made use of it. At the then prevailing value of Japanese war notes, the amount could have been invested profitably in other real estate or business transactions. Under the circumstances, the principle of estoppel is not to be ruled out. DISPOSITION: Upon the foregoing considerations, the judgment as to intervenor Dr. Jacinto is affirmed and as to the defendant reversed the defendant being hereby absolved, with costs of both instances against the plaintiffs and appellees.

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ARCEO v CA G.R. No. 142641 CORONA, July 17, 2006 (cha) NATURE Petition for review on certiorari FACTS -Arceo obtained 2 consecutive loans from Cenizal: P100k then P50k. He then issued a BPI Check postdated August 4, 1991 for P150k at Cenizals house located at 70 Panay Ave., QC. -August 4, 1991, Cenizal did not deposit the check immediately because Arceo promised 7 times that he would replace the check with cash. But since Arceo failed to replace the check, Cenizal brought the check to the bank for encashment 120 days after the due date. The checked bounced because of insufficient funds. -Cenizal then went to Arceos house to inform him of the dishonor of the check. However, Arceo already left the place. Arceo was given a letter giving him 3 days from receipt thereof to pay the amount of the check but Arceo still failed to pay. -Cenizal then executed an affidavit and submitted documents in support of his complaint for estafa and violation of BP 221. -However, Cenizal lost the check in question and the return slip after a fire occurred near his residence on 1992. He executed an Affidavit of Loss instead. -TC: GUILTY
1 SECTION 1. Checks without sufficient funds. ? Any person who makes or draws and issues any
check to apply on account or for value, knowing at the time of issue that he does not have sufficient funds in or credit with the drawee bank for the payment of such check in full upon its presentment, which check is subsequently dishonored by the drawee bank for insufficiency of funds or credit or would have been dishonored for the same reason had not the drawer, without any valid reason, ordered the bank to stop payment, shall be punished by imprisonment of not less than thirty days but not more than one (1) year or by a fine of not less than but not more than double the amount of the check which fine shall in no case exceed Two Hundred Thousand Pesos, or both such fine and imprisonment at the discretion of the court. The same penalty shall be imposed upon any person who, having sufficient funds in or credit with the drawee bank when he makes or draws and issues a check, shall fail to keep sufficient funds or to maintain a credit to cover the full amount of the check if presented within a period of ninety (90) days from the date appearing thereon, for which reason it is dishonored by the drawee bank. Where the check is drawn by a corporation, company or entity, the person or persons who actually signed the check in behalf of such drawer shall be liable under this Act.

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-CA:GUILTY, MFR denied -Petitioners contention: TC and CA erred in convicting him because: (1) prosecution failed to present the dishonored check during trial; (2) the check was presented beyond the 90-day period provided under the law; (3) notice requirement was not complied with, given only 3 days and not 5 banking days to pay, as required by law; (4) payment of obligation ISSUE 1. WON the CA erred in convicting him even though the check was presented beyond the 90-day period 2. WON the prosecution is required to present the check which was dishonored 3. WON all the elements of the offense are present 4. WON Arceo was deprived of the 5-day period required by law and if ever, did he pay HELD 1. NO. Ratio. The 90-day period provided in the law is not an element of the offense. Neither does it discharge petitioner from his duty to maintain sufficient funds in the account within a reasonable time from the date indicated in the check. According to current banking practice, the reasonable period within which to present a check to the drawee bank is six months. Thereafter, the check becomes stale and the drawer is discharged from liability thereon to the extent of the loss caused by the delay. [Wong vs. CA] Reasoning. Cenizals presentment of the check to the drawee bank 120 days (four months) after its issue was still within the allowable period. Petitioner was freed neither from the obligation to keep sufficient funds in his account nor from liability resulting from the dishonor of the check. 2. NO Ratio. The rule applies only where the content of the document is the subject of the inquiry. Where the issue is the execution or existence of the document or the circumstances surrounding its execution, the best evidence rule does not apply and testimonial evidence is admissible. The gravamen of the offense is the act of drawing and issuing a worthless check. Hence, the subject of the inquiry is the fact of issuance or execution of the check, not its content. Reasoning. The due execution and existence of the check were sufficiently established. Cenizal testified that he presented the originals of the check, the return slip and other pertinent documents before the Office of the City Prosecutor of Quezon City when he executed his complaint-affidavit during the preliminary investigation. The City Prosecutor found a prima facie case against petitioner for violation of BP 22 and filed the corresponding information based on the documents. Although the check and the return slip were among the documents lost by Cenizal in a fire that occurred near his residence on September 16, 1992, he was nevertheless able to adequately establish the due execution, existence and loss of the check and the return slip in an affidavit of loss as well as in his testimony during the trial of the case. Moreover, petitioner himself admited that he issued the check. He never denied that the check was presented for payment to the drawee bank and was dishonored for having been drawn against insufficient funds. 3. YES. Both the trial and appellate courts found that petitioner issued the postdated check in the amount of P150k. Check was deposited but was dishonored for insufficient funds. Petitioner knew he did not have sufficient funds, he even requested Cenizal not to encash it and promised that he would replace it with cash instead. Nevertheless, he still did not replace the checks with cash. 4. NO and NO. Cenizals counsel informed Arceo in writing of the checks dishonor and demanded payment of the value of the check. Petitioner still failed to pay the amount of the check even after receipt of demand for payment, even after the period of 5 banking days have passed. On payment, he presented no proof to support it. If he indeed paid, he should have redeemed the check from Cenizal as in the ordinary course of business but instead, Cenizal still possessed the check. Disposition. WHEREFORE, the petition is hereby DENIED. The April 28, 1999 decision and March 27, 2000 resolution of the Court of Appeals in CA-G.R. CR No. 19601 are AFFIRMED. Costs against petitioner. US V GREGORIO & BALISTOY G.R. No. L-5791 TORRES; December 17, 1910 (rach)

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NATURE Appeals were interposed by the defendants Bernardo Gregorio and Eustaquio Balistoy from the judgment rendered in the two causes prosecuted which were consolidated FACTS - This case concerns the falsity of a document alleged to have been written on a date prior to the one when it actually was prepared, which instrument simulates the sale of a parcel of land by its owner to a third party, with the intent to defraud the creditor, who, through proper judicial process, solicited and obtained the attachment and sale of the said property in order, with the proceeds of such sale, to recover the amount which the owner of the land owed him. - Prior case: In a suit instituted by Pedro Salazar, as a creditor, against Eustaquio Balistoy, in the justice of the peace court of Libog, for the payment of a certain sum of money, judgment was rendered wherein the debtor was sentenced to pay to the plaintiff P275.92. - For the execution of the said judgment, two rural properties belonging to the debtor were attached. May 27, 1908 was set as the date for the sale and adjudication of the said attached properties. A few days before such date, Bernardo Gregorio requested the deputy sheriff to exclude the said realty from the attachment, alleging that he was the owner of the land situated in Tambogon, one of the properties levied upon, for the reason that he had acquired it by purchase from the judgment debtor, Balistoy, in 1905, prior to the filing of the complaint. - By reason of this claim and petition, the judgment creditor, Salazar, had to give a bond, in view of which the sheriff proceeded with the sale of the said property, and of another, also attached for the sum of P300, and both were adjudicated to the judgment creditor. - In order that the claim of intervention presented to the sheriff might prosper, Bernardo Gregorio attached thereto the document Exhibit D, at the end of which and among other particulars appears the memorandum dated in Libog as of February 22, 1905, and signed by Eustaquio Balistoy, Lorenzo Gregorio, and Cirilo Valla, and in which Balistoy states that he bought the land referred to in the said document from Luis Balistoy and sold it to Bernardo Gregorio for P300, wherefore he signed as such vendor.

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- Current charge: Balistoy, with intent to injure his creditor, Pedro Salazar, and for the purpose of avoiding the attachment and sale of one of the properties belonging to him, to secure the payment of the judgment obtained by his creditor in the aforementioned suit, did, with disregard of the truth in the narration of the facts, execute or write the said memorandum whereby, on February 25, 1905, he made or simulated a conveyance of one of the attached properties in favor of the said Bernardo Gregorio, according to the aforesaid copy, when in fact the said memorandum was written in April, 1908. - The court pronounced both of them guilty of falsification of a private document. Defendants appealed. ISSUE WON the defendants were guilty of the crime of falsification of a private document HELD NO Ratio Through the lack of the original document containing the memorandum alleged to be false, it is improper to hold, with only a copy of the said original in view, that the crime prosecuted was committed; and although, judging from the testimony of the witnesses who were examined in the two consolidated causes, there is reason to entertain much doubt as to the defendants' innocence, yet, withal, this case does not furnish decisive and conclusive proof of their respective guilt as coprincipals of the crime charged. Defendants in a criminal cause are always presumed to be innocent until their guilt be fully proven, and, in case of reasonable doubt and when their guilt is not satisfactorily shown, they are entitled to a judgment of acquittal. - In criminal proceedings for the falsification of a document, it is indispensable that the judges and courts have before them the document alleged to have been simulated, counterfeited, or falsified, in order that they may find, pursuant to the evidence produced in the cause, whether or not the crime of falsification was committed, and also, at the same time, to enable them to determine the degree of each defendant's liability in the falsification under prosecution. Reasoning In the charge filed in this case against the vendor and the vendee of the land in question, it is stated that these parties, the defendants, simulated the said memorandum of sale or conveyance of the land with the intent to injure the creditor, Pedro Salazar. - But as the original document, setting forth the said memorandum, was not presented, but merely a copy thereof, and furthermore, as it could not be ascertained who had the original of the document containing the memorandum in question, nor the exact date when the latter was written. - The said memorandum, presumed to be simulated and false, was not literally compared by the sheriff who testified that he had seen its original for but a few moments, nor by any officer authorized by law to certify to documents and proceedings such as are recorded in notarial instruments, nor even by two witnesses who might afterwards have been able to testify before the court that the copy exhibited was in exact agreement with its original. - Therefore, on account of these deficiencies, doubt arises as to whether the original of the document, Exhibit D, really existed at all, and whether the memorandum at the foot of the said exhibit is an exact copy of that alleged to have been written at the end of the said original document. Disposition For the foregoing reasons, it is proper, in our opinion, with a reversal of the judgment appealed from, to acquit, and we hereby do acquit Eustaquio Balistoy and Bernardo Gregorio. PROVINCIAL FISCAL OF PAMPANGA V REYES G.R. No. 35366 VILLAMOR; August 5, 1931 (apple) NATURE Petition for the issuance of a writ of mandamus FACTS -The provincial fiscal of Pampanga filed two informations for libel against Andres Guevarra, alleging that he caused the publication in Ing Magumasid ( weekly paper in Pampango dialect), a squib in verse, intended to impeach the honesty, integrity, and reputation of Clemente Dayrit and Mariano Nepomuceno. -The fiscal attempted to present as evidence Exhibits A, B, C, and D, which are copies of the Ing Magumasid

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containing the libelous article with the innuendo, another article in the vernacular published in the same weekly, and its translation into Spanish. -Counsel for the defendant objected to this evidence, which objection was sustained by the court. Petitioner's Contention -The exhibits in question are the best evidence of the libel, the subject matter of the information, and should therefore be admitted Respondent's Argument Inasmuch as the libelous articles were not quoted in the information (what was quoted was not the actual article but its Spanish translation), said evidence cannot be admitted without amending the information. ISSUE 1.WON an information charging a libel published in an unofficial language, without including a copy of the libelous article, but only a translation into Spanish is valid 2. WON a writ of mandamus to compel the respondent judge to admit Exhibits A, B, C, and D should issue HELD 1. Yes Gen rule: The complaint or information for libel must set out the particular defamatory words as published, and a statement of their substance and effect is insufficient Exception: If the libelous article had been published in an unofficial language, as in this case, it is sufficient to insert a Spanish or English translation in the information. 2.Yes. -The general rules regarding the admissibility of evidence are applicable to cases of libel or slander. The evidence must be relevant, and not hearsay. -This being so, the rule of procedure which requires the production of the best evidence, is applicable to the present case. -Certainly, the copies of the weekly where the libelous article was published, and its translation, constitute the best evidence of the libel charged. The newspaper itself is the best evidence of an article published in it. -The respondent judge undoubtedly has discretion to admit or reject the evidence offered by the fiscal; but in the instant case his refusal to admit such evidence

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amounts to an abuse of that discretion, which may be controlled by this court by means of mandamus proceedings. Disposition Petition granted PEOPLE v. TANDOY GR 80505; December 4, 1990; Cruz (Ina) FACTS An information against Tandoy was filed with the RTC. It charged him with selling 10 pieces of dried marijuana, a prohibited drug, for P20. He was convicted. He appealed. Prosecutions evidence: Police officers conducted a buy-bust operation along Solchuaga St., Bgy Singkamas, Makati. One officer posed as a buyer and waited for a pusher near a store. Tandoy approached him and right away asked him if wanted to iskor. The officer paid a P10 bill and two P5 bills (marked money) for two rolls of marijuana. Then the other officers arrested Tandoy. They made a body search and found 8 more rolls. They brought him to the police station to be investigated. Tandoy remained silent after being read his rights. This was narrated by 3 police officers. Microscopic, chemical and chromatographic examination of the confiscated marijuana was positive for marijuana. The marijuana was offered as exhibit. Defendants story: He was playing cara y cruz with 15 other people along Solchuaga St., when somebody suddenly said that the police were making arrests. The people grabbed the bet money and scattered. He was arrested and the money they found on him was from the game. He and a fellow player were taken to the police station and mauled to give up the other pushers. The trial court believed the police officers story over the defendants. Applying the presumption that they had performed their duties in a regular manner, it rejected Tandoy's uncorroborated allegation that he had been manhandled and framed. ISSUE WON the admission of only the Xerox copy of the P10 bill was erroneous, based on best evidence rule. RULING NO. Apparently, appellant erroneously thinks that said marked money is an ordinary document falling under Sec. 2, Rule 130 of the Revised Rules of Court which excludes the introduction of secondary evidence except in the five (5) instances mentioned therein. The best evidence rule applies only when the contents of the document are the subject of inquiry. Where the issue is only as to whether or not such document was actually executed, or exists, or in the circumstances relevant to or surrounding its execution, the best evidence rule does not apply and testimonial evidence is admissible. (Cf. Moran, op. cit., pp. 76-77; 4 Martin, op. cit., p. 78.) Since the aforesaid marked money was presented by the prosecution solely for the purpose of establishing its existence and not its contents, other substitutionary evidence, like a xerox copy thereof, is therefore admissible without the need of accounting for the original. Moreover, the presentation at the trial of the "buybust money" was not indispensable to the conviction of the accused-appellant because the sale of the marijuana had been adequately proved by the testimony of the police officers. So long as the marijuana actually sold by the accused-appellant had been submitted as an exhibit, the failure to produce the marked money itself would not constitute a fatal omission. DE VERA v. AGUILAR GR 83377; February 9, 1993; Campos, Jr. (Chrislao) FACTS -Petitioners Basilio, Luis, Felipe, Eustaquia and Maria, all surnamed de Vera and respondent Leona, married to respondent Mariano Aguilar, are the children and heirs of the late Marcosa Bernabe who died on May 10, 1960.

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-In her lifetime, Marcosa Bernabe owned the disputed parcel of land -The disputed property was mortgaged by petitioners Basilio and Felipe de Vera to a certain Atty. Leonardo Bordador. When the mortgage had matured, the respondents redeemed the property from Atty. Leonardo Bordador and in turn Marcosa Bernabe sold the same to them as evidenced by a deed of absolute sale dated February 11, 1956. -On February 13, 1956, the respondents registered the deed with the Registry of Deeds of Bulacan resulting in the cancellation of the tax declaration in the name of Marcosa Bernabe and the issuance of another in the name of the Aguilars. -On July 20, 1977, respondent Mariano Aguilar was issued a free patent to the land on the basis of which Original Certificate of Title was issued in his name. -The petitioners wrote to the respondents claiming that as children of Marcosa Bernabe, they were co-owners of the property and demanded partition thereof on threats that the respondents would be charged with perjury and/or falsification. The petitioners also claimed that the respondents had resold the property to Marcosa Bernabe on April 28, 1959. -On September 27, 1980, the respondents wrote in reply to the petitioners that they were the sole owners of the disputed parcel of land and denied that the land was resold to Marcosa Bernabe. -True to petitioners' threat, they filed a falsification case against the respondents. However, on March 31, 1981, Assistant Provincial Fiscal Arsenio N. Mercado of Bulacan recommended dismissal of the charge of falsification of public document against the respondents for lack of a prima facie case. -On March 26, 1981, petitioners filed a suit for reconveyance of the lot.

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-TC ruled in petitioners favor. CA reversed. It found that the loss or destruction of the original deed of sale has not been duly proven by the petitioners. Hence, secondary evidence, i.e., presentation of the xeroxed copy of the alleged deed of sale is inadmissible ISSUE -WON petitioners have satisfactorily proven the loss of the original deed of sale so as to allow the presentation of the xeroxed copy of the same. RULING -NO. Secondary evidence is admissible when the original documents were actually lost or destroyed. But prior to the introduction of such secondary evidence, the proponent must establish the former existence of the instrument. The correct order of proof is as follows: Existence; execution; loss; contents although this order may be changed if necessary in the discretion of the court. The sufficiency of proof offered as a predicate for the admission of an alleged lost deed lies within the judicial discretion of the trial court under all the circumstances of the particular case. -A reading of the decision of the trial court shows that it merely ruled on the existence and due execution of the alleged deed of sale dated April 28, 1959. It failed to look into the facts and circumstances surrounding the loss or destruction of the original copies of the alleged deed of sale. -In the case at bar, the existence of an alleged sale of a parcel of land was proved by the presentation of a xeroxed copy of the alleged deed of absolute sale. -In establishing the execution of a document the same may be established by the person or persons who executed it, by the person before whom its execution was acknowledged, or by any person who was present and saw it executed or who, after its execution, saw it and recognized the signatures; or by a person to whom the parties to the instrument had previously confessed the execution thereof. -SC agrees with the TC's findings that petitioners have sufficiently established the due execution of the alleged deed of sale through the testimony of the notary public. -After the due execution of the document has been established, it must next be proved that said document has been lost or destroyed. The destruction of the instrument may be proved by any person knowing the fact. The loss may be shown by any person who knew the fact of its loss, or by any one who had made, in the judgment of the court, a sufficient examination in the place or places where the document or papers of similar character are usually kept by the person in whose custody the document lost was, and has been unable to find it; or who has made any other investigation which is sufficient to satisfy the court that the instrument is indeed lost. -However, all duplicates or counterparts must be accounted for before using copies. For, since all the duplicates or multiplicates are parts of the writing itself to be proved, no excuse for non-production of the writing itself can be regarded as established until it appears that all of its parts are unavailable (i.e. lost, retained by the opponent or by a third person or the like) -In the case at bar, Atty. Emiliano Ibasco, Jr., notary public who notarized the document testified that the alleged deed of sale has about four or five original copies. Hence, all originals must be accounted for before secondary evidence can be given of any one. This petitioners failed to do. Records show that petitioners merely accounted for three out of four or five original copies. CA affirmed RODELAS V ARANZA ET AL. RELOVA; DECEMBER 7, 1982 (jaja) FACTS On January 11, 1977, appellant filed a petition with the Court of First Instance of Rizal for the probate of the holographic will of Ricardo B. Bonilla and the issuance

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of letters testamentary in her favor. The petition was opposed by the appellees Amparo Aranza Bonilla, Wilferine Bonilla Treyes Expedita Bonilla Frias and Ephraim Bonilla. The appellees likewise moved for the consolidation of the case with another case. Their motion was granted by the court in an order dated April 4, 1977. On November 13, 1978, following the consolidation of the cases, the appellees moved again to dismiss the petition for the probate of the will. They argued that: (1) The alleged holographic was not a last will but merely an instruction as to the management and improvement of the schools and colleges founded by decedent Ricardo B. Bonilla; and (2) Lost or destroyed holographic wills cannot be proved by secondary evidence unlike ordinary wills. Upon opposition of the appellant, the motion to dismiss was denied by the court in its order of February 23, 1979. The appellees then filed a motion for reconsideration on the ground that the order was contrary to law and settled pronouncements and rulings of the Supreme Court, to which the appellant in turn filed an opposition. On July 23, 1979, the court set aside its order of February 23, 1979 and dismissed the petition for the probate of the will of Ricardo B. Bonilla. The court said held that in view of the lapse of more than 14 years from the time of the execution of the will to the death of the decedent, the fact that the original of the will could not be located shows that the decedent had discarded before his death his allegedly missing Holographic Will. Appellant's motion for reconsideration was denied. Hence, an appeal to the Court of Appeals in which it is contended that the dismissal of appellant's petition is contrary to law and well-settled jurisprudence. On July 7, 1980, appellees moved to forward the case to this Court on the ground that the appeal does not involve a question of fact. ISSUE WON a holographic will which was lost or cannot be found can be proved by means of a photostatic copy HELD YES. Pursuant to Article 811 of the Civil Code, probate of holographic wills is the allowance of the will by the court after its due execution has been proved. The probate may be uncontested or not. If uncontested, at

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least one Identifying witness is required and, if no witness is available, experts may be resorted to. If contested, at least three Identifying witnesses are required. However, if the holographic will has been lost or destroyed and no other copy is available, the will cannot be probated because the best and only evidence is the handwriting of the testator in said will. It is necessary that there be a comparison between sample handwritten statements of the testator and the handwritten will. But, a photostatic copy or xerox copy of the holographic will may be allowed because comparison can be made with the standard writings of the testator. In the case of Gam vs. Yap, 104 PHIL. 509, the Court ruled that "the execution and the contents of a lost or destroyed holographic will may not be proved by the bare testimony of witnesses who have seen and/or read such will. The will itself must be presented; otherwise, it shall produce no effect. The law regards the document itself as material proof of authenticity." But, in Footnote 8 of said decision, it says that "Perhaps it may be proved by a photographic or photostatic copy. Even a mimeographed or carbon copy; or by other similar means, if any, whereby the authenticity of the handwriting of the deceased may be exhibited and tested before the probate court," Evidently, the photostatic or xerox copy of the lost or destroyed holographic will may be admitted because then the authenticity of the handwriting of the deceased can be determined by the probate court. . NAPOCOR v. HON. RAMON G. CODILLA, JR. [BANGPAI SHIPPING COMPANY, & WALLEM SHIPPING, INC.] G.R. No. 170491 CHICO-NAZARIO; April 4, 2007 (edel) -NAPOCOR filed an Amended Complaint dated 8 July 1996 impleading Wallem as additional defendant, contending that the latter is a ship agent of Bangpai. -Bangpai & Wallem filed their respective Motions to Dismiss which were denied by J. Codilla. -NAPOCOR after adducing evidence during the trial of the case, filed a formal offer of evidence before the lower court consisting of Exhibits "A" to "V" together with the sub-marked portions thereof. Consequently, Bangpai and Wallem filed their respective objections to said formal offer of evidence. - J. Codilla denied (through an order) the admission and excluding from the records NAPOCORs Exhibits "A", "C", "D", "E", "H" and its sub-markings, "I", "J" and its sub-markings, "K", "L", "M" and its sub-markings, "N" and its sub-markings, "O", "P" and its sub-markings, "Q" and its sub-markings, "R" and "S" and its sub-markings. -According to the court a quo: The record shows that the plaintiff has been given every opportunity to present the originals of the Xerox or photocopies of the documents it offered. It never produced the originals. The plaintiff attempted to justify the admission of the photocopies by contending that "the photocopies offered are equivalent to the original of the document" xxxthe Xerox copies do not constitute the electronic evidence defined in Section 1 of Rule 2 of the Rules on Electronic Evidencexxx However, these excluded evidence should be attached to the records of this case to enable the appellate court to pass upon them should an appeal be taken from the decision on the merits to be rendered upon the termination of the trial of this case. - NAPOCORs MR was denied and so the filed a petition for Certiorari via R64 before the Court of Appeals maintaining that J. Codilla acted with GAD amounting to lack or excess of jurisdiction in denying the admission of its exhibits and its sub-markings. - CA dismissed the petition as it appeared that there was no sufficient showing by NAPOCOR that there was GAD. It appeared that the pieces of documentary evidence which were denied admission were not properly identified by any competent witness. Also, they found that the judge acted within the pale of his discretion when he denied admission of said documentary evidence for in Sec 3 of Rule 130 of the RoC, when the subject of inquiry are the contents of documents, no evidence shall be admissible other than the original documents themselves, except in certain cases specifically so enumerated therein, and the

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petitioner has not shown that the non-presentation or non-production of its original documentary pieces of evidence falls under such exceptions. Lastly, the CA said that the information (in said exhibits) were not received, retrieved or produced electronically and that NAPOCOR had not properly authenticated such evidence as electronic documents. - Hence, the instant petition wherein NAPOCOR insists that the photocopies it presented as documentary evidence actually constitute electronic evidence based on its own premise that an "electronic document" as defined under Section 1(h), Rule 2 of the Rules on Electronic Evidence is not limited to information that is received, recorded, retrieved or produced electronically. Rather, "electronic document" can also refer to other modes of written expression that is produced electronically, such as photocopies, as included in the sections catch-all proviso: "any printout or output, readable by sight or other means". ISSUE: WON the photocopies are indeed electronic documents as contemplated in RA No. 8792 or the IRR of the Electronic Commerce Act, as well as the Rules on Electronic Evidence/ WON said electronic documents qualify under the one of the exceptions of Best Evidence Rule so that those may be admitted as documentary evidence HELD: NO/NO. Reasoning: -A perusal of the information contained in the photocopies submitted by NAPOCOR will reveal that not all of the contents therein, such as the signatures of the persons who purportedly signed the documents, may be recorded or produced electronically. By no stretch of the imagination can a persons signature affixed manually be considered as information electronically received, recorded, transmitted, stored, processed, retrieved or produced. - According to the SC, the TC did not commit an error when it denied the admissibility of the photocopies as documentary evidence as Napocor failed to establish that its offer falls under the exceptions (as herein enumerated). Best Evidence Rule under Rule 130 (as discussed by the SC):

Nature: Certiorari under Rule 45 Facts: -M/V Dibena Win, a vessel of foreign registry owned and operated by Bangpai allegedly bumped and damaged NAPOCORs Power Barge 209 which was then moored at the Cebu International Port. -NAPOCOR then filed before the Cebu RTC a complaint for damages against Bangpai for the alleged damages caused on the power barges.

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When the original document has been lost or destroyed, or cannot be produced in court, the offeror, upon proof of its execution or existence and the cause of its unavailability without bad faith on his part, may prove its contents by a copy, or by a recital of its contents in some authentic document, or by the testimony of witnesses in the order stated. The offeror of secondary evidence is burdened to prove the predicates thereof: (a) the loss or destruction of the original without bad faith on the part of the proponent/offeror which can be shown by circumstantial evidence of routine practices of destruction of documents; (b) the proponent must prove by a fair preponderance of evidence as to raise a reasonable inference of the loss or destruction of the original copy; and (c) it must be shown that a diligent and bona fide but unsuccessful search has been made for the document in the proper place or places. - History of BER: Before the onset of liberal rules of discovery, and modern technique of electronic copying, the best evidence rule was designed to guard against incomplete or fraudulent proof and the introduction of altered copies and the withholding of the originals. But the modern justification for the rule has expanded from the prevention of fraud to a recognition that writings occupy a central position in the law. The importance of the precise terms of writings in the world of legal relations, the fallibility of the human memory as reliable evidence of the terms, and the hazards of inaccurate or incomplete duplicate are the concerns addressed by the best evidence rule. (Lee v. P of the Phils) -DEFINITION: "electronic document" refers to information or the representation of information, data, figures, symbols or other models of written expression, described or however represented, by which a right is established or an obligation extinguished, or by which a fact may be proved and affirmed, which is received, recorded, transmitted, stored, processed, retrieved or produced electronically. It includes digitally signed documents and any printout, readable by sight or other means which accurately reflects the electronic data message or electronic document. -The rules use the word "information" to define an electronic document received, recorded, transmitted, stored, processed, retrieved or produced electronically. This would suggest that an electronic document is relevant only in terms of the information contained therein, similar to any other document which is presented in evidence as proof of its contents. However, what differentiates an electronic document from a paper-based document is the manner by which the information is processed; clearly, the information contained in an electronic document is received, recorded, transmitted, stored, processed, retrieved or produced electronically. * NOTE: It was also said that NAPOCOR continued to obdurately disregard the opportunities given by the TC for it to present the originals of the photocopies it presented BUT at the SC it prayed that it be allowed to present the originals of the exhibits that were denied admission or in case the same are lost, to lay the predicate for the admission of secondary evidence. However, SC denied said prayer. DISPOSITIVE: Petition DENIED. CA DECISION of 9 November 2005 AFFIRMED. Costs against petitioner. REPUBLIC V. VERZOSA GR NO. 173525 TINGA; March 28, 2008 (chriscaps) FACTS - Verzosa filed petition for reconstitution of orig TCT, alleging that she and Edna Garcia are registered owners of parcel of land. - However, the orig was burned when QC Hall was gutted by fire. The Duplicate Certificate was lost as shown by Affidavit of Loss. - Real estate taxes on he prop have been paid. - RTC set the case for hearing. Only rep from OSG appeared. Petitioner-appellee was allowed to present further evidence. Hearing was reset on the ground, among others, of the need to amend petition to implead petitioners co-owner, Edna Garcia, who is also her sister. On July 18, 2001, petitioner filed a motion for leave to present evidence ex-parte without impleading her co-owner, citing the irreconcilable differences between them which the RTC granted. - RTC ordered Register of Deeds to reconstitute. Hence, the appeal by Republic, through OSG. - According to the Court of Appeals, the petition for reconstitution was filed under Sec. 3(f) of Republic Act

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(R.A.) No. 26 which grants the court the authority to consider other documents which it finds sufficient and proper bases for the reconstitution prayed for. In this case, the documentary evidence presented by respondent Gertrudes B. Verzosa, coupled with the Report submitted by the Land Registration Authority (LRA) confirming the previous existence of TCT No. 140606, is sufficient basis to grant the reconstitution. - OSG argues respondent did not prove that she had exerted honest efforts to secure the documents enumerated in the law and had failed to find them. ISSUE WON TCT should be reconstituted HELD YES. - Sec. 3 of R.A. No. 26 enumerates the sources upon which the reconstitution of transfer certificates of title shall be based. - Among the sources enumerated in Sec. 3 of R.A. No. 26, the owners duplicate of the transfer certificate of title is given primacy because such document is, by all accounts, an exact reproduction of the original copy of the transfer certificate of title. It is required, however, that the owners duplicate certificate itself, and not a mere photocopy thereof, be presented to the court. - In this case, only a photocopy of the owners duplicate was presented. - Photocopy of the owners certificate of title presented by respondent in support of her petition is still considered secondary evidence. As such, it is inadmissible unless respondent proves any of the exceptions provided in Sec. 3, Rule 130. - The Court explained the order of presentation of secondary evidence under Sec. 5, Rule 130 of the Rules of Court as existence, execution, loss, contents. The order may be changed if necessary in the discretion of the court. The sufficiency of the proof offered as a predicate for the admission of an allegedly lost document lies within the judicial discretion of the trial court under all the circumstances of the particular case. - Ultimately, the Court reinstated the decision of the trial court because of the failure of the Spouses Mateo to satisfactorily show that the original of the transfer certificate of title sought to be reconstituted had been lost or is no longer available, as well as the illegibility of the photocopy presented.

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- Respondent submitted several documents to prove existence, execution and contents of the Certificate of Title. Respondent also duly proved loss of owners copy. - When a court, after hearing of a petition for reconstitution, finds that the evidence presented is sufficient and proper to grant the same, that the petitioner therein is the registered owner of the property, and that the certificate sought to be reconstituted was in force at the time it was lost, it becomes the duty of the court to issue the order of reconstitution. - BPI filed a case against the Laguna Coconut Oil Co. and the Fidelity and Surety Company. The Fidelity and Surety Company interposed a demurrer to the plaintiff's complaint twice and was sustained twice. BPI appealed to the SC where the ruling was reversed and the case remanded for further proceedings. - Back in the TC, Laguna Coconut Oil Co. made no defense, and judgment by default was obtained against it. The case as to Fidelity and Surety Company was submitted to the court upon a stipulation of facts. TC rendered judgment against the Fidelity and Surety Company for the full amount of the note, with interest. Fidelity and Surety Company appealed alleging that the action involved a reformation of the contract of guaranty, which was not put in issue by the pleadings. Judgment was reversed and the action dismissed, "without prejudice to the bringing of another action upon the same cause." - BPI filed a new case wherein it attempted to connect the promissory note with an existing obligation of the Philippine Vegetable Oil Company in the form of another promissory note. The evidence was also intended to demonstrate that a clear error had been committed when reference was made to the Laguna Coconut Oil Co. instead of Bank of the Philippine Islands in the notation on the note. - TC: The note could not have been discounted by the Laguna Coconut Oil Co., and this must logically have been done by BPI. Judgment in favor of the BPI for P50,000 plus interest, attorney's fees, and costs. ISSUES WON reformation of the note, and thereafter, its enforcement, is justified. HELD NO Ratio To justify the reformation of a written instrument upon the ground of mistake, the concurrence of three things are necessary, the misake: (1) should be of a fact; (2) should be proved by clear and convincing evidence; and (3) should be common to both parties to the instrument. Reasoning - According to Sec. 285 of the Code of Civil Procedure, a written agreement is presumed to contain all the terms of the agreement. However, the Code permits evidence of the terms of the agreement other than the contents of the writing where a mistake or imperfection

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Parol Evidence Rule

BPI V FIDELITY & SURETY CO. G.R. No. L-26743 MALCOLM; October 19, 1927 (joey) NATURE Appeal from the decision of the CFI of Manila FACTS - Laguna Coconut Oil Co. executed a promissory wherein it promised to pay the Philippine Vegetable Company, Inc., or order, P50,000. - Fidelity and Surety Company of the Philippine Islands made a notation on the note as follows: For value, received, we hereby obligate ourselves to hold the Laguna Coconut Oil Co. harmless against loss for having discounted the foregoing note at the value stated therein. - Philippine Vegetable Oil Company endorsed the note in blank and delivered it to BPI. After maturity of the note, demand for its payment was made on the Laguna Coconut Oil Co., the Philippine Vegetable Oil Company, and the Fidelity and Surety Company of the Philippine Islands, all of whom refused to pay, the first being admittedly insolvent.

of the writing, or its failure to express the true intent and agreement of the parties, is put in issue by the pleadings. - Philippine Sugar Estates Development Company vs. Government of the Philippine Islands: (1) the courts of equity will reform a written contract where, owing to mutual mistake, the language used therein did not fully or accurately express the agreement and intent of the parties; (2) the relief by way of reformation will not be granted unless the proof of mutual mistake be "of the clearest and most satisfactory character;" (3) the evidence introduced by the appellant met these stringent requirements. - Centenera vs. Garcia Palicio; Mendozana vs. Philippine Sugar Estates Development Co. and De Garay: the amount of evidence necessary to sustain a prayer for relief where it is sought to impugn a fact in a document is always more than a mere preponderance of the evidence. - An examination of the note and the guaranty discloses that in the notation to the note the word "hold" is interlined. This indicates that the VP (signatory) of the Fidelity and Surety Company had his particular attention called to the language of the note, and corrected the typewritten matter by inserting in ink the word quoted. That the writer of the notation fell into a further error in obligating the company to the Laguna Coconut Oil Co. may be possible. That the writer may have had in mind to use the words Philippine Vegetable Oil Company, Inc. may also be possible. The names of the two parties before the guarantor were Laguna Coconut Oil Co. and Philippine Vegetable Oil Company, Inc. The guaranteeing company could not very well have assumed that BPI at a later date was contemplating discounting the note. - It is also apparent on the face of the note that it was to draw interest at maturity. This would disprove discount of the note by BPI on or before the maturity date. In truth, it is not certain that BPI ever did discount the note. - The bookkeeping entries of the bank are hardly competent against a stranger to the transaction. Moreover, one entry at least in plaintiff's Exhibit E has been changed by erasing the words "y Fidelity and Surety Co. of the Phil. Islands" and substituting "Philippine Vegetable Oil Co. garatizado p. Fidelity & Surety Co. of the Phil. Islands." The book entries taken at their face value are not conclusive.

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- The correspondence between the parties fails to disclose either an express or implied admission that the defendant had executed the guaranty in question in favor of the plaintiff bank. An attempt to interpret the correspondence merely leads open further into the field of speculation. Yet the rule is that an admission or declaration to be competent must have been expressed in definite, certain, and unequivocal language. Here the exhibits are couched in language which is neither definite, certain, nor unequivocal for nowhere do they contain an admission of a guaranty made by the defendant company for the protection of the BPI. - There may have been a mistake here. It would, however, seem to be straining the natural course of events to hold the Fidelity and Surety Company of the Philippine Islands a party to that mistake. - With all the various pleadings, all the various incidents, all the various facts, all the various legal principles, and all the various possibilities to the forefront, we cannot bring ourselves to conclude that the plaintiff, by proof of the clearest and most satisfactory character constituting more than a preponderance of the evidence, has established a mutual mistake. Instead, the proof is left far behind that goal. Dispositive Judgment appealed from reversed. SEPARATE OPINION AVANCEA, STREET, VILLAMOR and ROMUALDEZ [dissenting] - An examination of the indorsement, or contract shows that the Fidelity and Surety Company acknowledges that it has received value for placing its signature on said indorsement, thereby nominally obligating itself to hold that Laguna Coconut Oil Co. (sic?) harmless against loss for having discounted the note. Although the mistake is not obvious to the superficial reader, the words used make an impossible situation and completely frustrate the manifest intention of the parties. It is proved as a fact that the Laguna Coconut Oil Co. was debtor to the Philippine Vegetable Oil Co. and that the note to which the indorsement of guaranty is appended was given for that indebtedness. That an error was made in the wording of the indorsement is obvious and undeniable. The intention of the contracting parties could only have been that the Fidelity and Surety Company should hold harmless the person or entity discounting the note. The plaintiff did in fact discount said note on the faith of this indorsement, and the instrument should be reformed so as to give expression to the liability of the defendant company to the bank. - By the decision of the court, the Fidelity and Surety Company is entirely free from the obligation of guaranty in respect to this note, although it received value for that very undertaking. We therefore dissent.

A2010

LECHUGAS v. CA (LOZAs) G.R. No. L-39972 & L-40300 GUTIERREZ, JR; August 6, 1986 (ricky) NATURE Petition for review FACTS - Victoria Lechugas filed a complaint for forcible entry with damages against the Lozas, alleging that the latter by means of force, intimidation, strategy and stealth, unlawfully entered lots A and B, corresponding to the middle and northern portion of the property owned by her known as Lot No. 5456 which she allegedly bought from Leoncia Lasangue as evidenced by a Deed of Absolute Sale registered in the Office of the Register of Deeds (Exhibit A). She alleged that they appropriated the produce for themselves, and refused to surrender the possession of the land despite demands. The complaint was dismissed. She appealed to the then CFI of Iloilo. While the above appeal was pending, she instituted another action before the CFI of Iloilo for recovery and possession of the same property against the Lozas. The two cases were tried jointly. Both cases were dismissed. The CA sustained the dismissal. - Leoncia Lasangue, testifying for defendants declared that she inherited 12 hectares from her parents, being the only child and heir and that on December 8, 1950, she sold 6 hectares of her inherited property to Victoria Lechugas under a public instrument (Exhibit A) which was prepared at the instance of Victoria Lechugas and thumb-marked by herself (the vendor was illiterate). Refuting Lechugas' contention that the land sold to her is the very land under question, vendor Leoncia Lasangue was able to specifically point out that the land which she sold to Lechugas was the lot in the south known as Lot No. 5522 and not Lot. No. 5456

which was to the north and which was sold by her father in 1941 to the predecessor-in-interest of the Lazos. [Read the original testimony to see how the defense lawyer, using a piece of paper and the sun's movement as a reference, skillfully obtained this fact from an illiterate witness.] - On the basis of the testimony of vendor Leoncia Lasangue, the CA upheld the CFI's decision but also declared Exhibit A as NOT null and void ab initio insofar as Lasangue was concerned because it could pass ownership of the lot in the south known as Lot No. 5522 which she intended to sell and actually sold to Lechugas. ISSUE WON the CA erred in considering parol evidence over the objection of the petitioner in order to vary the subject matter of the Deed of Definite Sale (Exhibit A) although the land therein is described and delimited by metes and bounds and indentified as Lot No. 5456 of the Lambunao Cadastre. HELD NO. Ratio The parol evidence rule does not apply, and may not properly be invoked by either party to the litigation against the other, where at least one of the parties to the suit is not party or a privy of a party to the written instrument in question and does not base a claim on the instrument or assert a right originating in the instrument or the relation established thereby. Reasoning The petitioner's reliance on the parol evidence rule is misplaced. The rule is not applicable where the controversy is between one of the parties to the document and third persons. The deed of sale was executed by Leoncia Lasangue in favor of Victoria Lechugas. The dispute over what was actually sold is between Lechugas and the Lazos. Through the testimony of Leoncia Lasangue, it was shown that what she really intended to sell and to be the subject of Exhibit A was Lot No. 5522 but not being able to read and write and fully relying on the good faith of her first cousin, the petitioner [walang hiyang pinsan ito ah. Tsk. ], she just placed her thumb mark on a piece of paper which petitioner told her was the document evidencing the sale of land. The deed of sale described the disputed lot instead. [Note: Lechugas was also occupying Lot. No. 5522 and contended that she bought it from a certain Leonora Lasangue but couldnt

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Prof. V. A. Avena Evidence

present such person or any evidence to support this claim.] - From her testimony, there can be no other conclusion but that Lasangue did not intend to sell, as she could not have sold, a piece of land already sold by her father to the predecessor-in-interest of the Lazos. - The fact that vendor Lasangue did not bring an action for the reformation of Exhibit A is of no moment. The undisputed fact is that the Lazos have timely questioned the validity of the instrument and have proven that, indeed Exhibit A does not reflect the true intention of the vendor. Disposition Petition is hereby DISMISSED. CRUZ V. COURT OF APPEALS 192 SCRA 209 CRUZ; December 10, 1990 (chriscaps) NATURE Petition to review the decision of the CA FACTS - Salonga filed complaint for collection and damages against Cruz alleging that Cruz borrowed fr him P35,000 evidenced by a receipt. - Cruz claimed that only P20,000 was pd, leaving balance of P15,000. He said that he and Salonga agreed that Salonga would grant him exclusive right to purchase the harvest of certain fishponds leased by him in exchange for certain loan accommodations. - Salonga delivered to Cruz various loans totaling P15,250 evidenced by 4 receipts and P4,000 receipt of w/c was lost. Cruz failed to comply by refusing to deliver the alleged harvest of fishpond and his indebtedness. - Cruz denied contracting any loan; he alleged that he was a lessee of fishponds owned by Yabut and that he agreed w/ Salonga that Salonga would purchase fish fr the fishpond. Salonga would also sublease the same fishpond. - Cruz admitted having received P35,000 but said these were received not as loans, but as consideration for the pakyaw agreement and payment for the sublease. - Cruz and Salonga entered into a partial stipulation of facts. - Salonga claimed that aside fr the P35,000, etc., he also delivered P28,000 w/c is the consideration for the pakyaw agreement, evidenced by receipt. - Cruz testified that out of the P35,000 he received, P28,000 covered full payment of the pakyaw agreement while P7,000 is advance payment for sublease. - TC ruled in favor of Cruz. CA reversed and ordered Cruz to pay Salonga. CA also found that the amounts were not payments for pakyaw and sublease, but for loans extended by Salonga to Cruz. ISSUES 1. WON Exhibit D is covered by the parol evidence rule 2. WON Exhibit I is covered by the parol evidence rule HELD 1. NO. - The reason for the rule is the presumption that when parties have reduced their agreement to writing they have made such writing the only repository and memorial of the truth, and whatever is not ofund in the writing is deemed waived or abandoned. - The rule is not applicable because it is predicated on existence of doc embodying terms of agreement. Exhibit D doesnt contain an agreement. It is only a receipt; not the sole memorial of the agreement. At most, it is a casual memorandum. - Wigmore: A receipt will in general fall without the line of the rule. Usually a receipt is merely a written admission of a transaction, independently existing. 2. NO. - Exhibit I doesnt make categorical declaration that the P28,000 was received by Cruz on the same date. The date then cant be conclusive. - A distinction should be made between STATEMENT OF FACT expressed in the instrument and the TERMS of the contractual act. The former may be varied by parol evidence; not the latter. The statement in Exhibit I of the petitioners receipt of P28,000 is just a statement of fact, not a part of the agreement. Thus, parol evidence may be introduced to explain Exhibit I. - Even if Exhibits D and I are covered by the rule, its application by CA was improper bec no objection was made by Salonga when Cruz introduced evidence to explain the circumstances. Objections to the evidence must be made as soon as the grounds therefor become reasonably apparent. In testimonial evidence, objection must be made when objectionable question is asked or after answer is given if objectionable features become apparent only by reason of such answer. For failure of

A2010

Salonga to object, he is deemed to have waived benefit of parol evidence rule. - Court is satisfied that P35,000 was received by Cruz as payment for pakyaw and sublease agreements. INCIONG V CA 257 SCRA 578 Romero J; June 26, 1996 (mini) FACTS: -Petitioner's liability resulted from the promissory note in the amount of P50,000.00 which he signed with Rene C. Naybe and Gregorio D. Pantanosas on February 3, 1983, holding themselves jointly and severally liable to private respondent Philippine Bank of Communications (PBC), Cagayan de Oro City branch. The promissory note was due on May 5, 1983 -Due date came and obligation was left unfulfilled. PBC sent telegrams to Inciong demanding payment. It also sent a letter to Nayde. Both obligors did not respond. Thus PBC filed a suit for the collection of 50,000. -Case was initially dismissed for failure of plaintiff to prosecute the case. However, the lower court reconsidered the dismissal order and required the sheriff to serve the summonses. Lower court also dismissed the case against defendant Pantanosas as prayed for by the private respondent herein. Meanwhile, only the summons addressed to petitioner was served as the sheriff learned that defendant Naybe had gone to Saudi Arabia. -Inciong on his part stated that: he was approached by his friend Campos who claimed that he was a partner of the branch manager of PBC, in the falacata logs operation. Campos also told him that Rene C. Naybe was interested in the business and would contribute a chainsaw to the venture. Campos then persuaded petitioner to act as a "co-maker" in the said loan. Petitioner allegedly acceded but with the understanding that he would only be a co-maker for the loan of P5,000.00. -Petitioner alleged further that five (5) copies of a blank promissory note were brought to him by Campos at his office. He affixed his signature thereto but in one copy, he indicated that he bound himself only for the amount of P5,000.00. Thus, it was by trickery, fraud and misrepresentation that he was made liable for the amount of P50,000.00.

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Prof. V. A. Avena Evidence

-TC and CA ordered Inciong to pay amount. Inciong appealed ISSUE: WON Inciong is liable for the payment of promissory note HELD: Yes *RULING ON PAROL EVIDENCE -Inciong claimed that since the promissory note "is not a public deed with the formalities prescribed by law but a mere commercial paper which does not bear the signature of attesting witnesses," parol evidence may "overcome" the contents of the promissory note. The first paragraph of the parol evidence rule states: "When the terms of an agreement have been reduced to writing, it is considered as containing all the terms agreed upon and there can be, between the parties and their successors-in-interest, no evidence of such terms other than the contents of the written agreement." -the rule does not specify that the written agreement be a public document. What is required is that agreement be in writing as the rule is in fact founded on "long experience that written evidence is so much more certain and accurate than that which rests in fleeting memory only, that it would be unsafe, when parties have expressed the terms of their contract in writing, to admit weaker evidence to control and vary the stronger and to show that the parties intended a different contract from that expressed in the writing signed by them. Thus, for the parol evidence rule to apply, a written contract need not be in any particular form, or be signed by both parties. As a general rule, bills, notes and other instruments of a similar nature are not subject to be varied or contradicted by parol or extrinsic evidence. -By alleging fraud in his answer, petitioner was actually in the right direction towards proving that he and his co-makers agreed to a loan of P5,000.00 only, considering that, where a parol contemporaneous agreement was the inducing and moving cause of the written contract, it may be shown by parol evidence. However, fraud must be established by clear and convincing evidence, mere preponderance of evidence, not even being adequate. Petitioner's attempt to prove fraud must, therefore, fail as it was evidenced only by his own uncorroborated and, expectedly, self-serving testimony. *other contentions -Inciong claimed that since the complaint was dropped against Naybe, his co-debtor and Pantonasa the guarantor, he should also be released from liability citing Art 2080 of CC. however contention is invalid. -the promissory note involved in this case expressly states that the three signatories therein are jointly and severally liable, any one, some or all of them may be proceeded against for the entire obligation. The choice is left to the solidary creditor to determine against whom he will enforce collection. Consequently, the dismissal of the case against Judge Pontanosas may not be deemed as having discharged petitioner from liability as well. As regards Naybe, suffice it to say that the court never acquired jurisdiction over him. Petitioner, therefore, may only have recourse against his co-makers, as provided by law. DUVAZ CORP. V EXPORT AND INDUSTRY BANK GR 163011 GARCIA; June 7, 2007 (bri) NATURE Petition for review (Rule 45, ROC) of the CA Decision dated March 26, 2004, nullifying an earlier Order of the Makati RTC w/c granted petitioners prayer for a writ of preliminary injunction in its action for reformation of instrument against herein respondent, Export and Industry Bank (EIB). FACTS - During the period 1994-1995, RDR Property Holdings, Inc. (RDR), which was a subsidiary of petitioner Duvaz Corp (Duvaz) until it was eventually absorbed by the latter, obtained various loans from the then Urban Banking Corporation (Urban Bank) to finance its real estate business. These loans were secured by real estate mortgages on 17 condominium units and 30 parking slots at The Peak Condominium in Makati City. - Sometime after it declared a bank holiday on April 25, 2000, Urban Bank was acquired and merged with respondent EIB. - Meanwhile, as a consequence of RDR being absorbed by Duvaz, the latter acquired all the assets and liabilities of the former, more specifically RDRs loan obligations with Urban Bank, which loan obligations were later transferred to EIB as a result of the corporate merger of the 2 banks.

A2010

- With the 1997 Asian financial crisis sending the Phil economy into turmoil, Duvaz defaulted in the payment of its loan obligations with Urban Bank as they fell due. On record, petitioner and Urban Bank mutually agreed to the restructuring of the formers indebtedness. By virtue of said loan restructuring, Duvaz executed in favor of Urban Bank 12 promissory notes for P20M each and 1 for P23M (total= P263M) with a uniform interest rate of 18.75% per annum, and all to mature on Oct 31, 2000. - EIB took over the operations of Urban Bank sometime before maturity of the restructured loans. Eventually, the restructured loans matured and became due and demandable. Because the loans remained unpaid, however, EIB required Duvaz to submit a mutually acceptable plan for the payment of the loan which, as of June 30, 2002, already amounted to P562,157,530.02 inclusive of interest and penalty charges. But instead of submitting any proposal for a plan of payment, as required by EIB, Duvaz protested the total amount of obligation being demanded upon. - Aug 8, 2002: EIB sent a final demand letter to Duvaz to settle its debts. - Aug 29: On account of said demand letter, Duvaz filed in the Makati RTC against EIB a complaint for reformation of instrument with prayer for a TRO and/or writ of preliminary injunction to enjoin EIB, as defendant in the suit, from commencing any foreclosure proceedings on the mortgaged properties of Duvaz as plaintiff. In its complaint, Duvaz alleged that its real agreement of dacion en pago with Urban Bank (EIBs predecessor-in-interest), w/c agreement was intended for the full and complete settlement of its entire obligation, was not reflected in the loanrestructuring agreement that was entered into in 1998, hence, the need to modify the terms thereof to reflect the parties true intention. - Pending determination of the merit of petitioners prayer for a writ of preliminary injunction, the parties mutually agreed to maintain the status quo ante. TC, therefore, found no need to issue any TRO. - Eventually, however, via an Order dated Sep 25, 2002, the court granted the preliminary injunction prayed for by Duvaz, to wit: WHEREFORE, in the interest of justice and equity, the Court GRANTS the injunction prayed for and accordingly orders defendant [to refrain] from initiating any foreclosure proceedings until further

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Prof. V. A. Avena Evidence

orders from this Court. Bond fixed at P10M. (Words in brackets added.) - EIBs MFR denied by the court in its subsequent order of Jan 8, 2003. Therefrom, EIB went to the CA on a petition for certiorari wherein said court promulgated the assailed Decision, thus: WHEREFORE, premises considered, the instant petition for certiorari is hereby GRANTED. Accordingly, the assailed orders are ANNULLED AND SET ASIDE and a new one issued DENYING [petitioners] prayer for a writ of preliminary injunction. - In granting EIBs certiorari petition and nullifying the questioned orders of the TC, CA notes Duvaz failure to show in its complaint and at the hearing of its application for preliminary injunction the indubitable existence of its right to the injunctive relief: In the case at bar, [petitioner] sought to enjoin [respondent] from foreclosing its mortgage properties on the ground that their alleged agreement entered into in 1998 is in reality a dacion en pago and not a loan-restructuring agreement which is the written contract. In short, [petitioners] alleged right emanates from an alleged dacion en pago which is yet to be proven in Court. This right is, therefore, contingent and future which cannot be protected by a writ of preliminary injunction. Moreover, the parol evidence rule proscribes the varying of the terms of a written agreement except in certain cases. [Petitioner] claims that its case falls under the exception, but then this is harping on the exception, not the rule, which is yet to be proven during trial. If indeed, there is such an agreement as dacion en pago, then only at that time can we say that [petitioner] possesses the right to be protected. But of course, this is merely conjectural and a future proposition, if not assumption, which is, however, insufficient to support the grant of a writ of preliminary injunction. (Words in brackets supplied.) ISSUE/S 1. WON there exists a right in esse on petitioners part which may rightfully be the basis for the issuance of a writ of preliminary injunction 2. WON EIBs recourse to the CA constitutes forum shopping HELD 1. NO. Ratio Anent the first issue, the requisites for preliminary injunctive relief are: (a) the invasion of right sought to be protected is material and substantial; (b) the right of the plaintiff is clear and unmistakable; and (c) there is an urgent and paramount necessity for the writ to prevent serious damage. As such, a writ of preliminary injunction may be issued only upon clear showing of an actual existing right to be protected during the pendency of the principal action. The twin requirements of a valid injunction are the existence of a right and its actual or threatened violation. Thus, to be entitled to an injunctive writ, the right to be protected and the violation against that right must be shown. Reasoning Almeida v. CA: It must be stressed that injunction is not designed to protect contingent or future rights, and, as such, the possibility of irreparable damage without proof of actual existing right is no ground for an injunction. A clear and positive right especially calling for judicial protection must be established. Injunction is not a remedy to protect or enforce contingent, abstract, or future rights; it will not issue to protect a right not in esse and which may never arise, or to restrain an action which did not give rise to a cause of action. There must be an existence of an actual right. Hence, where the plaintiffs right or title is doubtful or disputed, injunction is not proper. An injunctive remedy may only be resorted to when there is a pressing necessity to avoid injurious consequences which cannot be remedied under any standard compensation. The possibility of irreparable damage without proof of an actual existing right would not justify injunctive relief in his favor. x x x x x x x x x x x x. In the absence of a clear legal right, the issuance of the injunctive writ constitutes grave abuse of discretion. As the Court had the occasion to state in Olalia v. Hizon: It has been consistently held that there is no power the exercise of which is more delicate, which requires greater caution, deliberation and sound discretion, or more dangerous in a doubtful case, than the issuance of an injunction. It is the strong arm of equity that should never be extended unless to cases of great injury, where courts of law cannot afford an adequate or commensurate remedy in damages.

A2010

Every court should remember that an injunction is a limitation upon the freedom of action of the defendant and should not be granted lightly or precipitately. It should be granted only when the court is fully satisfied that the law permits it and the emergency demands it. We are in full accord with the CA when it struck down, for having been issued with grave abuse of discretion, RTCs Order granting petitioners prayer for a writ of preliminary injunction during the pendency of the main case. The reason therefor is that the right sought to be protected by the petitioner in this case through the writ of preliminary injunction is merely contingent and not in esse. It bears stressing that the existing written contract between petitioner and respondent was admittedly one of loan restructuring; there is no mention whatsoever or even a slightest reference in that written contract to a supposed agreement of dacion en pago. In fine, it is still necessary for petitioner to establish in the main case its rights on the alleged dacion en pago before those rights become in esse or actual and existing. Only then can the injunctive writ be properly issued. It cannot be the other way around. Otherwise, it will be like putting the cart before the horse. Besides, conformably to the Parol Evidence Rule, which is the general rule, when the terms of an agreement have been reduced to writing, it is considered as containing all the terms agreed upon and there can be, as between the parties and their successors in interest, no evidence of such terms other than the contents of the written agreement. This poses another big obstacle to a favorable finding of petitioners right in esse under the alleged dacion en pago agreement. Again, petitioner must first establish that alleged agreement in the main case where it bears the burden of duly proving by competent evidence that the written loan restructuring agreement failed to express the true intent of the parties. Until and unless this has been successfully carried out, there is no right in esse to speak of. And with EIB denying petitioners allegation of a right arising from an alleged dacion en pago agreement supposedly entered into by it not with EIB itself, but with Urban Bank, petitioners burden becomes doubly cumbersome. We find no such actual and existing right in favor of the petitioner that demands protection by the office of preliminary injunction.

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Prof. V. A. Avena Evidence

2. NO. Reasoning EIB assailed TCs order directing the issuance of the writ of preliminary injunction by filing a petition for certiorari with the CA. Seeking a reversal of an adverse judgment or order by appeal or certiorari does not constitute forum shopping. Such remedies are sanctioned and provided for by the rules. There will only be forum shopping when a party seeks a favorable opinion, other than by appeal or certiorari, in another forum. There is simply no rhyme nor reason to tag as forum shopping EIBs availment of a remedy provided under the rules in a situation where, as here, the RTC clearly gravely abused its discretion. Besides, the function of certiorari before the CA is only to annul the assailed interlocutory order of the trial court and nothing else. The CA cannot go beyond the said assailed interlocutory order and dismiss the main action which has not yet been resolved with finality. Disposition WHEREFORE, the instant petition is DENIED and the assailed CA Decision dated 26 March 2004 is AFFIRMED in toto. - Counsel for defendant insisted that the witness was competent; that the parties to the prosecution of a criminal case are the Government and the accused; that, furthermore the marriage of Dinal to the witness having been dissolved by the death of her husband, she is no longer his wife, and so not subject to any disqualification arising from the status of marriage. - Objection sustained. To this objection counsel took exception and made an offer to prove by the excluded witness the facts which he expected to establish by her testimony. Concerning these facts it is sufficient at this time to say that some of them would be both material and relevant, to such a degree that if proven to the satisfaction of the court, they might have lead to the acquittal of the accused, as they purported to relate to the dying declarations of the deceased, concerning the cause of his death, the general purport being that his injuries were due to fall and not to the acts imputed to the accused. ISSUES 1 WON the widow Susan Ezpeleta was disqualified as a witness by reason of marriage 2 WON the dying declaration of the victim to his wife constitute privileged communication HELD 1 NO. Ratio: On grounds of public policy the wife can not testify against her husband as to what came to her from him confidentially or by reason of the marriage relation, but this rule does not apply to a dying communication made by the husband to the wife on the trial of the one who killed him. The declaration of the deceased made in extremes in such cases is a thing to be proven, and this proof may be made by any competent witness who heard the statement. The wife may testify for the state in cases of this character as to any other fact known to her (Arnett vs. Commonwealth, 114 Ky., 593, 596) Reasoning: Sec. 58 of Gen. Orders No. 58 (1900) states that: Except with the consent of both, or except in cases of crime committed by one against the other, neither husband nor wife shall be a competent witness for or against the other in a criminal action or proceeding to which one or both shall be parties. - This case does not fall with the text of the statute or the reason upon which it is based, and therefore it is inapplicable. The purpose of Sec. 58 is to protect

A2010

accused persons against statements made in the confidence engendered by the marital relation, and to relieve the husband or wife to whom such confidential communications might have been made from the obligation of revealing them to the prejudice of the other spouse. Such is not the case at bar. 2 NO. Ratio: It can not be contended that the dying declaration testified to by the witness was a confidential communication made to her; on the contrary, it was evidently made in the furtherance of justice for the express purpose that it should be testified to in the prosecution of the defendant. (Arnett vs. Commonwealth, 114 Ky., 593, 596) Reasoning: Obviously, when a person at the point of death as a result of injuries he has suffered makes a statement regarding the manner in which he received those injuries, the communication so made is in no sense confidential. On the contrary, such a communication is made for the express purpose that it may be communicated after the death of the declarant to the authorities concerned in inquiring into the cause of his death. - The declarations of a deceased person while in anticipation of certain impending death, concerning the circumstances leading up to the death, are admissible in a prosecution of the person charged with killing the declarant. (U. S. vs. Gil, 13 Phil. 530.) Such dying declarations are admissible in favor of the defendant as well as against him. (Mattox vs. U. S., 146 U. S., 140.) It has been expressly held in several jurisdictions in the United States that the widow of the deceased may testify regarding his dying declarations. Disposition: Judgment of the court below is hereby SET ASIDE and a new trial is granted at which the testimony of the witness Susana Ezpeleta will be admitted. ALVAREZ V. RAMIREZ GR No. 143439; Sandoval-Gutierrez; 14 October 2005 (ice) NATURE Petition for review on certiorari

Disqualification by Reason of Marriage

PEOPLE VS FRANCISCO (yella) U.S. V ANTIPOLO G.R. No. L-13109 FISHER; March 6, 1918 (rean) FACTS - The appellant Antipolo was convicted by CFI Batangas, for the murder of one Fortunato Dinal. He appealed. One error assigned is based upon the refusal of the trial judge to permit Susana Ezpeleta, the widow of victim Dinal, to testify as a witness on behalf of the defense concerning certain alleged dying declarations. At the witness stand she stated that she is the widow of Fortunato Dinal, and was asked: "On what occasion did your husband die?" To this question the fiscal objected upon the ground that the witness is disqualified from testifying in this case in which her husband is the injured party.

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FACTS Susan Ramirez (respondent) is the complaining witness in the criminal case for arson pending before the RTC. The accused is Maximo Alvarez (petitioner). He is the husband of Esperanza G. Alvarez, sister of respondent. Private prosecutor called Esperanza Alvarez to the witness stand as the first witness against petitioner, her husband. Petitioner and his counsel raised no objection.Petitioner, through counsel, filed a motion to disqualify Esperanza from testifying against him pursuant to Rule 130 of the Revised Rules of Court on marital disqualification. Trial court issued an Order disqualifying Esperanza Alvarez from further testifying and deleting her testimony from the records.CA reversed the RTC decision. ISSUE WON Esperanza husband Alvarez can testify against her remotely or indirectly affecting domestic harmony comes within the exception is too broad. The better rule is that, when an offense directly attacks, or directly and vitally impairs, the conjugal relation, it comes within the exception to the statute that one shall not be a witness against the other except in a criminal prosecution for a crime committee (by) one against the other. Obviously, the offense of arson attributed to petitioner, directly impairs the conjugal relation between him and his wife Esperanza. His act, as embodied in the Information for arson filed against him, eradicates all the major aspects of marital life such as trust, confidence, respect and love by which virtues the conjugal relationship survives and flourishes. The act of private respondent in setting fire to the house of his sister-in-law Susan Ramirez, knowing fully well that his wife was there, and in fact with the alleged intent of injuring the latter, is an act totally alien to the harmony and confidences of marital relation which the disqualification primarily seeks to protect. The criminal act complained of had the effect of directly and vitally impairing the conjugal relation. It underscored the fact that the marital and domestic relations between her and the accused-husband have become so strained that there is no more harmony, peace or tranquility to be preserved. The Supreme Court has held that in such a case, identity is non-existent. In such a situation, the security and confidences of private life which the law aims to protect are nothing but ideals which through their absence, merely leave a void in the unhappy home. (People v. Castaeda, 271 SCRA 504). Thus, there is no longer any reason to apply the Marital Disqualification Rule. It should be stressed that as shown by the records, prior to the commission of the offense, the relationship between petitioner and his wife was already strained. In fact, they were separated de facto almost six months before the incident. Indeed, the evidence and facts presented reveal that the preservation of the marriage between petitioner and Esperanza is no longer an interest the State aims to protect. DISPOSITION AFFIRMED

A2010

Disqualification by Reason of Death and Insanity LICHAUCO VS ATLANTIC, GULF AND PACIFIC CO. (monch) GOI V CA (VICENTE) G.R. No. L-27434 FERNAN; September 23, 1986 (Anton) NATURE This is an appeal by certiorari from the decision of the then CA, as well as from the resolution denying petitioners' motion for reconsideration. FACTS - The 3 haciendas known as San Sebastian, Sarria and Dulce Nombre de Maria situated in the Bais, Negros Oriental, were originally owned by TABACALERA. - Sometime in 1949, the late Praxedes T. Villanueva, predecessor-in-interest of petitioners, negotiated with TABACALERA for the purchase of said haciendas. However, as he did not have sufficient funds to pay the price, Villanueva with the consent of TABACALERA, offered to sell Hacienda Sarria to one Santiago Villegas, who was later substituted by Joaquin Villegas. TABACALERA did not agree to the transaction between Villanueva and Villegas without a guaranty; thus Gaspar Vicente (herein respondent) stood as guarantor for Villegas in favor of TABACALERA. - Either because the amount realized from the transaction between Villanueva and Villegas still fell short of the purchase price of the three haciendas, or in consideration of the guaranty undertaken by Vicente, Villanueva contracted or promised to sell to Vicente fields nos. 3, 4 and 13 of Hacienda Dulce Nombre de Maria for the sum of P13,807.00. This agreement was reduced to writing and signed by Genaro Goi (petitioner) as attorney-in-fact of Villanueva. - Vicente thereafter advised TABACALERA to debit from his account the amount of P13,807.00 as payment for the balance of the purchase price. However, as only the amount of P12,460.24 was actually needed to complete the purchase price, only the latter amount was debited from Vicentes account. The difference was supposedly paid by Vicente to Villanueva, but as no receipt evidencing such payment was presented in court, this fact was disputed by petitioners.

HELD/ RATIO Yes. Section 22, Rule 130 of the Revised Rules of Court has an exception, where the marital and domestic relations are so strained that there is no more harmony to be preserved nor peace and tranquility which may be disturbed, the reason based upon such harmony and tranquility fails. In such a case, identity of interests disappears and the consequent danger of perjury based on that identity is non-existent. Likewise, in such a situation, the security and confidences of private life, which the law aims at protecting, will be nothing but ideals, which through their absence, merely leave a void in the unhappy home. This is in lieu of the justification for the rule which are 1. There is identity of interests between husband and wife; 2. If one were to testify for or against the other, there is consequent danger of perjury; 3. The policy of the law is to guard the security and confidences of private life, even at the risk of an occasional failure of justice, and to prevent domestic disunion and unhappiness; and 4. Where there is want of domestic tranquility there is danger of punishing one spouse through the hostile testimony of the other. In Ordoo vs. Daquigan, this Court held: The rule that the injury must amount to a physical wrong upon the person is too narrow; and the rule that any offense

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- Subsequent to the execution of the contract/promise to sell, Villanueva was able to raise funds by selling a property. He thus went to private respondent Vicente for the purpose of rescinding the contract/promise to sell. However, as the amount of P12,460.24 had already been debited from private respondent's account, it was agreed that lots 4 and 13 of the Hacienda Dulce Nombre de Maria would merely be leased to private respondent Vicente for a period of five years at an annual rental of 15% of the gross income, said rent to be deducted from the money advanced by Vicente and any balance owing to Villanueva would be delivered by Vicente together with the lots at the end of the stipulated period of lease. - December 10, 1949: TABACALERA executed a formal deed of sale covering the three haciendas in favor of Villanueva. Fields Nos. 3, 4 and 13 of the Hacienda Dulce Nombre de Maria were thereafter registered in the name of Villanueva. The fields were likewise mortgaged by Villanueva to the Rehabilitation Finance Corporation (RFC), later transferred to the PNB. - Fields nos. 4 and 13 were delivered to private respondent Vicente after the 1949-1950 milling season in January and February, 1950. - June 17, 1950: Villanueva executed a "Documento de la Venta Definitive" in favor of Joaquin Villegas, covering Lot No. 314 of the Cadastral Survey of Bais (Hacienda Sarria). A supplemental instrument was later executed by Villanueva in favor of Villegas to include in the sale of June 17, 1950 the sugar quota of the land. - November 12, 1951: Villanueva died. Intestate proceedings were instituted on November 24, 1951 before the then CFI of Negros. Among the properties included in the inventory submitted to the court were fields nos. 3, 4 and 13 of Hacienda Dulce Nombre de Maria. - On the day before the intestate proceedings were ordered closed and the estate of the late Praxedes Villanueva delivered to his heirs, respondent Vicente instituted an action for recovery of property and damages before the then CFI of Negros Oriental against petitioner Goi in his capacity as administrator of the intestate estate of Praxedes Villanueva. Vicente sought to recover field no. 3 of the Hacienda Dulce Nombre de Maria, basing his entitlement thereto on the contract/promise to sell executed by the late Praxedes Villanueva in his favor on October 24, 1949. - On October 25, 1954, petitioner Goni as defendant in Civil Case No. 2990, filed an answer with counterclaim for accounting of the produce of fields nos. 4 and 13, as well as the surrender thereof. After an answer to the counterclaim had been filed, private respondent Vicente amended his complaint on September 1, 1955, to include a prayer for damages representing the produce of field no. 3 from 1949-50 until delivery thereof to him. An answer with counterclaim to the amended complaint was duly filed, and on April 25, 1956, private respondent Vicente amended his complaint anew to include as parties-defendants the heirs of the late Praxedes Villanueva. - July 13, 1957: the parties entered into a stipulation of facts, agreeing, among others, on the costs of production and produce of the three fields in question. The case thereafter proceeded to trial. Defendants presented Genaro Goi, who testified on the alleged verbal lease agreement. - Trial court rendered a decision ordering therein defendants-heirs to deliver to Gaspar Vicente field no 3, to execute a formal deed of sale covering fields nos. 3, 4 and 13 in favor of Vicente. - Both parties appealed the decision to the then Court of Appeals. CA affirmed the decision of the lower court. Petitioners Claim - Hacienda Dulce Nombre de Maria would merely be leased. ISSUE(S) 1. WON Vicente may testify on matters of fact occurring before the death of Praxedes Villanueva, which constitutes a claim or demand upon his estate. 2. WON a written promise to sell dated October 1949 be novated into a verbal agreement of lease during the lifetime of the promissory, whose death occurred on November 1951, by facts and circumstances substantiated by competent oral evidence. HELD

A2010

- Under ordinary circumstances, respondent Vicente would be disqualified by reason of interest from testifying as to any matter of fact occurring before the death of Praxedes T. Villanueva, such disqualification being anchored on Section 20(a) of Rule 130, commonly known as the Survivorship Disqualification Rule or Dead Man Statute, which provides as follows: Section 20. Disqualification by reason of interest or relationship.-The following persons cannot testify as to matters in which they are interested, directly or indirectly, as herein enumerated: (a) Parties or assignors of parties to a case, or persons in whose behalf a case is prosecuted, against an executor or administrator or other representative of a deceased person, or against a person of unsound mind, upon a claim or demand against the estate of such deceased person or against such person of unsound mind, cannot testify as to any matter of fact occurring before the death of such deceased person or before such person became of unsound mind. - The object and purpose of the rule is to guard against the temptation to give false testimony in regard to the transaction in question on the part of the surviving party and further to put the two parties to a suit upon terms of equality in regard to the opportunity of giving testimony. It is designed to close the lips of the party plaintiff when death has closed the lips of the party defendant, in order to remove from the surviving party the temptation to falsehood and the possibility of fictitious claims against the deceased. The defendants-heirs are properly the "representatives" of the deceased, not only because they succeeded to the decedent's right by descent or operation of law, but more importantly because they are so placed in litigation that they are called on to defend which they have obtained from the deceased and make the defense which the deceased might have made if living, or to establish a claim which the deceased might have been interested to establish, if living. - HOWEVER, such protection was effectively waived when counsel for petitioners cross-examined private respondent Vicente. A waiver occurs when plaintiff's deposition is taken by the representative of the estate or when counsel for the representative cross-examined the plaintiff

1.

YES (General Rule ay HINDI) Ratio The protection was waived. And the disadvantage sought to be prevented by the law does not exist in the said case. Reasoning

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as to matters occurring during deceased's lifetime. - The inequality or injustice sought to be avoided by Section 20(a) of Rule 130, where one of the parties no longer has the opportunity to either confirm or rebut the testimony of the other because death has permanently sealed the former's lips, does not actually exist in the case at bar, for the reason that petitioner Goi could and did not negate the binding effect of the contract/promise to sell. - The petitioners presented a counterclaim against private respondent Vicente. When Vicente thus took the witness stand, it was in a dual capacity as plaintiff in the action for recovery of property and as defendant in the counterclaim for accounting and surrender of fields nos. 4 and 13. Evidently, as defendant in the counterclaim, he was not disqualified from testifying as to matters of fact occurring before the death of Praxedes Villanueva, said action not having been brought against, but by the estate or representatives of the estate/deceased person. - The adverse party is competent to testify to transactions or communications with the deceased or incompetent person which were made with an agent of such person in cases in which the agent is still alive and competent to testify. But the testimony of the adverse party must be confined to those transactions or communications which were had with the agent. Goi was attorney-in-fact of Praxedes. He was privy to the circumstances surrounding the contract, and could therefore confirm or deny the allegations of Vicente. 2. There was novation. Reasoning - The novation of the written contract/promise to sell into a verbal agreement of lease was clearly and convincingly proven not only by the testimony of petitioner Goi, but likewise by the acts and conduct of the parties subsequent to the execution of the contract/promise to sell. Thus, after the milling season of crop year 1949-50, only fields nos. 4 and 13 were delivered to private respondent Vicente. Fields nos. 3, 4 and 13 were subsequently registered in Villanueva's name and mortgaged with the RFC. Villanueva likewise executed a deed of sale covering Hacienda Sarria in favor of Joaquin Villegas. All these were known to private respondent Vicente, yet he did not take any steps toward asserting and/or protecting his claim over fields nos. 3, 4 and 13 either by demanding during the lifetime of Villanueva that the latter execute a similar document in his favor, or causing notice of his adverse claim to be annotated on the certificate of title of said lots. - The verbal lease agreement was negotiated by and between Villanueva and private respondent Vicente themselves. Being close friends and relatives it can be safely assumed that they did not find it necessary to reduce the same into writing. - Petitioners, having clearly and sufficiently shown that the contract/promise to sell was subsequently novated into a verbal lease agreement, it follows that they are entitled to a favorable decision on their counterclaim. DISPOSITION The decision appealed from is hereby reversed.

A2010

ONG CHUA vs. CARR 53 PHIL 980 OSTRAND; Jan 17, 1929 (marge) NATURE Appeal by the defendants from a CFI Zamboanga decision FACTS -Lots Nos. 136 and 137 and the house on lot No. 132 originally belonged to one Henry E. Teck, and lot No. 135 was the property of Teck's wife, Magdalena Lim. Sometime prior to June 20, 1923, it seems that the spouses sold the property in question to plaintiff Ong Chua, and on June 17, 1923, the latter executed a public document granting to Lim the right to repurchase lot 135 for the sum of P6,500 within four years from that date, and on the 20th of the same month, he executed another public document in which he agreed to sell lots Nos. 136, 137, and the house on lot 132 to Teck for the sum of P13,500 at any time within four years from date. Neither one of the documents was placed on record with the register of deeds. -July, 1925: Edward Carr came to Zamboanga, went to the office of Moore and sought the advice and assistance of the latter in regard to purchasing coconut lands. After various interviews, Moore called Carr's

attention to the lots above-mentioned and told him that he could buy the lots for P20,000, the amount which Ong Chua paid for them to Teck and Lim. Carr entered into negotiations with Ong Chua and Moore, and many conversations took place in which Moore, among other things, informed Carr that Teck and his wife had the right to repurchase the property in question from Ong Chua and that such rights would expire in June, 1927. -Dec 14, 1925: Ong Chua and Carr went to the office of Moore, to whom they delivered copies of the documents under which Teck and Lim acquired their rights to repurchase the property involved, and requested him to draw the deed of sale of the property from Ong Chua to Carr. Before the drafting of the deed, Ong Chua stated to Moore that he consented to sell the properties to Carr on the condition that the sale should be subject to the rights of Teck and Lim to have the property reconveyed to them and that said rights were to be respected by the vendee. According to Moore's own testimony, Carr was fully aware of those rights even before the execution of the deed and that he consented to embody stipulations to that effect in said deed. -The purchase price of the property stipulated between vendor and vendee was P20,000. When the deed of sale was about to be drafted, Carr informed Moore that he had only P13,500 on hand and that he desired to obtain a loan of P6,500 from the Zamboanga Mutual Building and Loan Association of which Moore was the secretary. Moore told him in effect that the loan could not be made upon property the titles to which were not clear and that the right of Teck and Lim to repurchase were not entered upon the certificates of title to the property. Moore also told Carr that the deed of sale could be made in such a form that Carr's title to the property purchased would appear to be absolute but that Carr was to bear in mind that the rights of Teck and Lim still existed and that the deed and other documents must be left in his, Moore's, possession until the expiration of the term for the right of repurchase and that, if the deed were made in that form, the loan of P6,500 could be obtained. -Moore thereupon instructed his clerk to prepare and typewrite the deed of sale without including therein the condition that the sale was subject to Teck's and Lim's rights to repurchase. The deed was signed by Ong Chua in the presence of Darlucio and duly acknowledged before Moore as notary public. It may be noted that Ong Chua did not understand English and was therefore

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ignorant of the arrangement arrived at between Moore and Carr in connection with the loan, but he asked Moore if the document contained the conditions in reference to Teck's right to repurchase the property and was told that the document was sufficient. -After the deed was prepared and signed, Ong Chua told Carr and Moore that lot No. 137 was mortgaged by him to the Bank of the Philippine Islands for P6,500, the rate of interest being 10 per cent per annum. Moore stated that the Zamboanga Building and Loan Association could not lend money at less than 13 per cent per annum. Ong Chua then stated that he was willing to let the mortgage on the lot given to the bank stand until the expiration of the term for the repurchases. As this arrangement would save Carr a considerable sum of money, he agreed to the proposition and paid only P13,500 in cash and promised, in writing, to pay to the vendor the balance of the purchase price, P6,500, with interest at 10 per cent per annum, on or before July 1, 1927. The loan from the Building and Loan Association thus became unnecessary, but instead of redrafting the deed, it was agreed that Moore would keep the deed and the other documents in his custody and would not deliver them to any one until the expiration of the period for repurchase. -Sept 1926: Moore was taken critically ill, and while he was under medical treatment in the Zamboanga Hospital, Carr came to him on various occasions and demanded that the documents be delivered to him. At first Moore refused to make the delivery on the ground that it was contrary to their agreement and might result to the prejudice of the rights of Teck and Lim, but Carr continued to molest Moore with his demand for the delivery of the papers, and finally, in order to escape further annoyances and insinuations of Carr, he surrendered the deed to the latter, who almost immediately presented it to the register of deeds for registration. -July, 1926: Teck offered to repurchase the property in question from Ong Chua who thereupon demanded of Carr the reconveyance of the property to the spouses, Teck and Lim, but Carr refused to do so, claiming that he had an absolute title to said property, and Ong Chua then learned, for the first time, that the deed in question contained no reference to the rights of Teck and Lim to repurchase the property. -This action was brought. Defendants demurrer was overruled. He thereupon filed an answer pleading the general issue and setting up as special defenses that the deed in question contained no stipulation as to rights of repurchase and that if there was any agreement or promise on the part of the defendant to convey the property to Teck and Lim or to the plaintiff, as alleged in the complaint, such agreement and promise was for the sale of real property, or an interest therein, and that neither said agreement or promise, nor any note or memorandum was made in writing or subscribed by the defendant or by any authorized person for him. Subsequent to the filing of the answer, Carr died, and the administrator of his estate, Manuel Igual, was substituted as defendant. At the trial of the case, no evidence was offered by the defendant, and, consequently, the facts hereinbefore stated stand uncontradicted. Upon such facts, CFI Zamboanga ordered the reformation of the deed. Hence, this appeal. ISSUES 1. WON the court erred in permitting Ong Chua, to testify to facts occurring prior to the death of the defendant Carr 2. WON the facts proven justify the reformation of the deed in question. HELD 1. NO -Section 383.7 of the Code of Civil Procedure bars parties to an action or proceeding against an executor or administrator or other representative of a deceased person upon a claim or demand against the estate of such deceased person from testifying as to any matter of fact occurring before the death of such deceased person. BUT it has generally been given a liberal construction to promote justice, and it is held that it never was intended to serve as a shield for fraud. -Jones on Evidence: "The evidence of an adverse party is absolutely excluded by an independent, affirmative enactment making him incompetent as to transactions or communications with a deceased or incompetent person. These statutes, however, do not render the adverse party incompetent to testify to fraudulent transactions of the deceased, as the statutes are not designed to shield wrongdoers but the courts compel the adverse party to clearly establish the alleged fraudulent acts before admitting such testimony."

A2010

-Tongco vs. Vianzon: "The object and purpose of this statute is to guard against the temptation to give false testimony in regard to the transaction in question on the part of the surviving party. An equally important rule is that the law was designed to aid in arriving at the truth and was not designed to suppress the truth." -A number of credible witnesses testified to facts which conclusively showed that Carr's conduct was tainted with fraud. Plaintiff did not take the witness stand until after the existence of fraud on the part of Carr had been established beyond a doubt and not by a mere preponderance of evidence. In these circumstances, we cannot hold that the trial court erred in not excluding the plaintiff's testimony. 2. YES. Reformation will be given "where there is a mistake on one side and fraud or unfair dealing on the other." -Counsel admits that the deed was left in escrow with Moore. It is well settled that the condition upon which a deed is delivered in escrow may be proved by parol evidence and that ordinarily the statute of frauds has no application to such an agreement, nor is it affected by the rule of evidence, which prohibits a written contract from being contradicted or varied by parol evidence. It is also well established that an escrow delivered without authority or obtained fraudulently passes no title. -That is what occurred here; Moore had no authority whatever to deliver the deed in escrow to Carr before the expiration of the time for redemption. It follows that the certificates of title issued to Carr were of no legal effect and that the suit for the rescission of the deed and the cancellation of the corresponding certificates of title would be in order (see the last two provisos in sec. 55 of Act No. 496). -The evidence is conclusive that the plaintiff had no clear conception of the contents of the deed. That he was anxious to protect the rights of redemption held by the parties who sold the land to him, is very obvious; indeed, if he had failed to do so, he would have laid himself open to an action for damages. But the deed was written in the English language, with which the plaintiff was unfamiliar, and he had to rely on the statements of Moore as to the contents and effect of the deed and was told that the document was sufficient. -Carr, on the other hand, knew the contents of the deed and fully agreed to Moore's plan to place it in escrow

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until the expiration of the term for the repurchase or redemption of the land. He, nevertheless, in violation of his own agreement, harassed Moore, then a very sick man, into giving him possession of the deed prematurely. He took immediate advantage of that circumstance and hastened to have the document presented to the register of deeds for the issuance of certificates of title. It is elementary that such conduct constitutes fraud and was calculated to obtain an unfair advantage over the plaintiff. - Counsel for both plaintiffs filed their claims with the committee of claims and appraisal of the estate of Benigno Goitia, and, upon their disallowance, appealed from the committee's decision by means of the complaints in these two cases. - The court below ordered the defendant, as judicial administratrix of Benigno Goitia's estate to render a judicial account of the intestate estate of the deceased Benigno Goitia, to render an account of the amounts collected by her aforesaid husband as attorney-in-fact and representative of the plaintiffs in the copartnership from 1915 to July, 1926, within thirty days from notice of this decision - Defendant, reiterating her exception to the court's decision enjoining her to render accounts, manifested that after a painstaking examination of the books of account of the copartnership and several attempts to obtain data from Ruperto Santos, the manager and administrator thereof, she has found no more evidence of any amount received by her late husband than a book of accounts where she came upon an item of P90 for Leonor Mendezona, and another of P36 for Valentina Izaguirre. - The court ordered the defendant, as judicial administratrix of the estate of the deceased Benigno Goitia, to pay the plaintiff Leonor Mendezona the sum of P13,140 with legal interest from the date of the filing of the complaint, and to pay the plaintiff Valentina Izaguirre P5,256 likewise with legal interest from the date of the filing of the complaint, and moreover, to pay the costs of both instances. - The defendant appealed from this judgment. -The appellees made depositions before the American consul at Bilbao, Spain, in accordance with section 356 of the Code of Civil Procedure. Counsel for the appellant was notified of the taking of these depositions, and he did not suggest any other interrogatory in addition to the questions of the committee. When these depositions were read in court, the defendant objected to their admission, invoking section 383, No. 7, of the Code of Civil Procedure. Her objection referred mainly to the following questions: 1. Did Mr. Benigno Goitia render you an account of your partnership in the "Tren de Aguadas?" Yes, until the year 1914. 2. From the year 1915, did Mr. Benigno Goitia send you any report or money on account of profits upon your shares? He sent me nothing, nor did he answer, my letters.

A2010

3. Did you ever ask him to send you a statement of your account Yes, several times by letter, but I never received an answer. ISSUE WON the appellees' depositions are admissible. HELD YES. The first of these questions tends to show the relationship between the principals and their attorneyin-fact Benigno Goitia up to 1914. Supposing it was error to permit such a question, it would not be reversible error, for that very relationship is proved by the Exhibits . - As to the other two questions, it is to be noted that the deponents deny having received from the deceased Benigno Goitia any money on account of profits on their shares, since 1915. We are of opinion that the claimants' denial that a certain fact occurred before the death of their attorney-in-fact Benigno Agoitia does not come within the legal prohibitions (section 383, No. 7, Code of Civil Procedure). - The law prohibits a witness directly interested in a claim against the estate of a decedent from testifying upon a matter of fact which took place before the death of the deceased. The underlying principle of this prohibition is to protect the intestate estate from fictitious claims. But this protection should not be treated as an absolute bar or prohibition from the filing of just claims against the decedent's estate. - The facts in the case of Maxilom vs. Tabotabo differ from those in the case at bar. - Maxilom vs. Tabotabo: the plaintiff Maxilom liquidated his accounts with the deceased Tabotabo during his lifetime, with the result that there was a balance in his favor and against Tabotabo of P312.37, Mexican currency. The liquidation was signed by both Maxilom and Tabotabo. In spite of this, some years later, or in 1906, Maxilom filed a claim against the estate of Tabotabo for P1,062.37alleging that P750 which included the 1899 liquidation had not really been received, and that therefore instead of P312.37, Mexican currency, that liquidation should have shown a balance of P1,062.37 in favor of Maxilom. It is evident that in view of the prohibition of section 383, paragraph 7, of the Code of Civil Procedure, Maxilom could not testify in his own behalf against Tabotabo's estate, so as to alter the balance of the liquidation made by and between himself and the decedent.

MENDEZONA V VIUDA DE GOITIA March 11, 1930; VILLAMOR, J. (lora) FACTS - Defendant Encarnacion C. Vda, de Goitia has been duly appointed judicial administratrix of the estate of her deceased husband Benigno Goitia - Benigno Goitia was the representative and attorneyin-fact of the plaintiffs in the joint-account partnership known as the Tren de Aguadas, of which the plaintiff Leonor Mendezona, widow of Juan Bautista Goitia, owns 180 shares worth P18,000, and the plaintiff Valentina Izaguirre y Nazabal owns 72 shares worth P7,200 - Prior to 1915, Benigno Goitia, at that time the manager of the co-partnership, collected the dividends for the plaintiffs, which he remitted to them every year. That the usual dividends which Benigno Goitia forwarded to plaintiff Leonor Mendezona each year were P540, and to plaintiff Valentina Izaguirre y Nazabal, P216 - From 1915 until his death in August, 1926, Benigno Goitia failed to remit the dividends - Some time before his death, more particularly, in July, 1926, Benigno Goitia, who was no longer the manager of the said business, receive as attorney-in-fact of both plaintiff, the amount of P90 as dividend upon plaintiff Leonor Mendezona's shares, and P36 upon Valentina Izaguirre y Nazabal's stock - During the period from 1915 to 1926, Benigno Goitia collected and received certain sums as dividends and profits upon the plaintiffs's stock in the Tren de Aguadas in his capacity as representative and attorneyin-fact for both of them, which he has neither remitted nor accounted for to the said plaintiffs

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- But in the case before us there has been no such liquidation between the plaintiffs and the deceased Goitia. They testify, denying any such liquidation. To apply to them the rule that "if death has sealed the lips of one of the parties, the law seals those of the other," would be to exclude all possibility of a claim against the testamentary estate. This was the legislator's intention. - The plaintiffs-appellees did not testify to a fact which took place before their representative's death, but on the contrary denied that it had taken place at all, i.e. they denied that a liquidation had been made or any money remitted on account of their shares in the "Tren de Aguadas" which is the ground of their claim. It was incumbent upon the appellant to prove by proper evidence that the affirmative proposition was true, either by bringing into court the books which the attorney-in-fact was in duty bound to keep, or by introducing copies of the drafts kept by the banks which drew them, as was the decedents's usual practice according to Exhibit I, or by other similar evidence. - The appellant admits having found a book of accounts kept by the decedent showing an item of P90 for the account of Leonor Mendezona and another of P36 for the account of Valentina Izaguirre, which agrees with the statement of Ruperto Santos, who succeeded Benigno Goitia in the administration of said partnership, to the effect that the deceased attorney-in-fact had collected the amounts due the plaintiffs as dividends on their shares for the months of May and June, 1926, or P90 for Leonor Mendezona, and P36 for Valentina Izaguirre, amounts which had not been remitted by the deceased to the plaintiffs. Disposition Judgment affirmed BABAO VS PEREZ (mel) On March 3 1924 Dr. Sityar operated on Carlos wife for appendicitis and other ailments. The wife was confined until March 18, and was required to often consult with the doctor afterwards. Carlos accompanied his wife during consultations. On one visit Dr. Sityar asked Carlos to buy medicine, which during his time away Dr. Sityar outraged his wife. The wife told Carlos after they left the clinic. Nevertheless, Carlos still consulted with Dr. Sityar with his lung trouble after the incident without revealing any special resentment. Later Dr. Sityar through letter asked Carlos to immediately settle the professional fees due him for treating Carlos wife. Carlos went to the clinic several times but wasnt able to talk to Dr. Sityar until May 26. The prosecution established through evidence that Carlos stabbed Dr. Sityar twice with a fan-knife without any preliminary quarrel, and inflicted a third wound while in pursuit. Carlos escaped but surrendered himself to the Constabulary the next evening. The defense presented arguments for self-defense which failed. TC convicted Carlos of murder due to evident premeditation, which only support was Exhibit L the wifes letter to Carlos [dated two days before the crime] which was seized by the police. In the letter, the wife feared that Carlos contemplated resorting to physical violence in dealing with Dr. Sityar. ISSUE I: Murder or homicide? [Is the letter admissible or is it privileged communication and therefore inadmissible?] HELD SC: Homicide. Letter inadmissible written by wife. Might have been admissible: - If wife testified at the trial and subject her testimony to impeachment, but she was not put on the witnessstand and the letter was therefore not offered for that purpose. - If Carlos, either by answer or otherwise, had indicated his assent to the statements contained in the letter, but he didnt. The letter therefore is pure hearsay and its admission in evidence violates the constitutional right of the defendant in a criminal case to be confronted with the witness for the prosecution and have the opportunity to examine them. In this respect there can be no

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difference between an ordinary communication and one originally privileged. When admissible: - Conversation ( Letter): The question is radically different from that of the admissibility of testimony of a third party as to a conversation between a husband and wife overheard by the witness. It is admissible because it relates to a conversation in which both spouses took part, and on the further ground that where the defendant has the opportunity to answer a statement made to him by his spouse and fails to do so, his silence implies assent. This cannot apply where the statement is contained in an unanswered letter. - Where a privileged communication from one spouse to another comes into the hands of a third party, whether legally or not, without collusion and voluntary disclosure on the part of either of the spouses, the privilege is thereby extinguished and the communication, if otherwise competent, becomes admissible. - Wigmore: If they were obtained surreptiously or otherwise without the addressees consent, the privilege should cease. Since Exhibit L is inadmissible, Carlos should be convicted only with murder. Regarding prosecutions contention that the crime was murder because it was committed with aleviosa (because one of the wounds received by the deceased showed a downward direction, indicating that the deceased was sitting down when the wound was inflicted), theres no sufficient proof because the direction of the wound would depend largely upon the manner in which the knife was held. DISSENT (Villamor): Carlos should have been convicted of murder. An eyewitness testified that Dr. Sityar had his arms lowered and was about to fall down when Carlos stabbed him, which wound according to the doctor-examiner could have caused Dr. Sityars death. The case of US v. Baluyot states that [e]ven though a deadly attack may be begun under conditions not exhibiting the feature of aleviosa, yet if the assault is continued and the crime is consummated with

Disqualification by Reason of Privileged Communication PEOPLE V FAUSTO CARLOS Ostrand; (Mar 17 25) (mae m) FACTS

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aleviosa, such circumstance may be taken consideration as a qualifying factor in murder. US VS ANTIPOLO (supra) See page 23. into

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