QUALIFICATIONS OF WITNESSES Despite guiding the truck, said vehicle ran over the eggplants being sold by Virginia
Costales. Petitioner picked up the vegetables and threw them towards the place where
TARAPEN VS PEOPLE
Assailed before Us is the Decision1 of the Court of Appeals in CA-G.R. CR No. 26636, dated
31 January 2006, which affirmed with modification the Decision2 of the Regional Trial
Court (RTC) of Baguio City, Branch 3, convicting petitioner Peter Chongoy Tarapen of the
crime of Homicide.
On 9 June 2000, petitioner was charged before the RTC of Baguio City with Frustrated
Homicide for attacking and assaulting James Lacbao Pangoden.3 The day after, the victim
died from the injuries he sustained. As a consequence, an amended information was filed
on 13 June 2000 charging petitioner with Homicide allegedly committed as follows:
That on or about the 8th day of June, 2000, in the City of Baguio, Philippines, and within
the jurisdiction of the Honorable Court, the above-named accused, with intent to kill, did
then and there willfully, unlawfully and feloniously attack, and assault JAMES LACBAO
PANGODEN, by hitting his head twice with a steel shovel, thereby inflicting upon the
latter: Cardio-respiratory arrest secondary to cranio-cerebral injury, which directly
caused his death.4
The case was raffled to Branch 3. When arraigned on 15 June 2000, petitioner, with the
assistance of counsel de oficio, pleaded not guilty to the crime charged.5
On 10 October 2000, the pre-trial conference of the case was terminated with the trial
court issuing its pre-trial order.6
The prosecution presented the following witnesses, namely: (1) Patricia S. Pangoden7;
(2) Molly J. Linglingen8; (3) Silmana Linglingen9; (4) Virginia Costales10; (5) Dr. Lindo
Mensalvas11; (6) Dr. Rizal Leo Cala12; and (7) Senior Police Officer (SPO) 2 Juanito
Meneses II.13
The collective testimonies of the witnesses revealed:
At around 7:00 to 7:30 in the morning of 8 June 2000, a dump truck driven by Jimmy
Pugoy arrived at Zandueta St., Baguio City, to collect garbage. He was accompanied by
petitioner and Edmond Ferrer. The garbage truck came from lower Zandueta St. and
proceeded to upper Zandueta St. Upon reaching the Hilltop Market, the truck turned
around. During this time, vendors, including the victim James Pangoden, Molly J.
Linglingen, Silmana Linglingen and Virginia Costales were peddling their wares along
said street. Petitioner alighted from the truck and signaled to the driver to move slowly.
James was. This angered James because the flowers he was selling were soiled. An
exchange of words ensued between petitioner and James.14 Petitioner went to the back of
the dump truck and got a shovel. He then moved in front of the truck where James was.
While James was facing downwards, petitioner, coming from behind and holding the
shovel with two hands, struck James on the head with the same, causing him to fall to the
ground in a squatting position. As soon as James raised his head, petitioner hit the
former's head again with the shovel.15 Petitioner then ran away. James was brought to the
Baguio General Hospital & Medical Center (BGHMC) in a taxi.
The wife of James, Patricia Pangoden, arrived at the BGHMC and saw her husband in the
Emergency Room. Dr. Rizal Leo Cala refused to operate on her husband, saying that it was
already hopeless. She then requested for the transfer of her husband to the Saint Louis
University (SLU) Hospital. The request was approved, and her husband was transferred
to SLU Hospital at 1:30 p.m. James was operated on, and Patricia was told that her
husband had no more chance to live. She was advised to bring home James; otherwise,
they would just be spending so much. Patricia brought her husband to his hometown in
Namatugan, Sudipen, La Union, where he expired on 10 June 2000.16
Patricia S. Pangoden testified on the events that happened to her husband from the time
he was bought to the hospital until the time he died. She also testified on the expenses she
incurred as a result of the incident.17
Molly J. Linglingen and Silmana Linglingen, mother and daughter, and co-vendors of
James at Zandueta St., testified that they saw petitioner get a shovel from the rear of the
garbage truck, approach James from behind, and hit him with it twice on the head.
Virginia Costales recounted the events prior to her seeing James already slumped on the
ground. She narrated that when the garbage truck was going down Zandueta St.,
petitioner got off from the truck and guided it. The truck ran over the eggplants she was
selling. Petitioner picked them up and threw them to where James was. James, she said,
got angry because the flowers he was selling were soiled. Petitioner and James exchanged
words. While the two were exchanging words, she transferred her sack of eggplants to a
nearby place. It was then that she heard people shouting. When she turned around, she
saw James already slumped on the ground oozing with blood.
Dr. Lindo Mensalvas and Dr. Rizal Leo Cala, physicians at the SLU Hospital and BGHMC,
respectively, attended to the victim. They respectively issued a medico-legal certificate
containing the injuries sustained by the victim.18
SPO2 Juanito Meneses II, assigned at Police Community Precinct 1, Baguio City, was the
investigator to whom the case of petitioner was turned over. At around 10:00 a.m. of 8
June 2000, the Division Chief of the General Services Office of Baguio City turned the
petitioner over to him. SPO2 Meneses disclosed that petitioner admitted to having
inflicted injuries on the victim. The police officer disclosed that he did not notice any
injury on Peter's body or face. He added that Peter did not request any medical treatment
that morning. He brought Peter to the BGHMC for possible identification, but the victim
was still unconscious. Upon going back to the police station, he took the statement of the
victim's wife. He likewise identified the steel shovel19 allegedly used in killing the victim.
The prosecution formally offered Exhibits "A" to "H," inclusive, with sub-markings which
the trial court admitted.20
For the defense, the following took the witness stand: (1) Jimmy Pugoy,21 (2) petitioner
Peter Tarapen,22 (3) Edmond Ferrer,23 and (4) Dr. Maryjane Tipayno.24
The version of the defense as culled from these witnesses is as follows:
Jimmy Pugoy, petitioner Peter Tarapen and Edmond Ferrer are garbage collectors
employed by the General Services Office of the City of Baguio. At around 3:00 a.m. of 8
June 2000, they started collecting garbage. At around 7:00 a.m., they arrived at Zandueta
St. Half of said street was almost occupied by vendors who were selling various goods. In
order to collect garbage piled on said street, the truck driven by Jimmy Pugoy had to go
up the street then go down. While going down the street, Pugoy kept on honking the
truck's horn, causing the vendors selling near the garbage pile to move away, but some of
their goods were left behind. Ferrer alighted and started filling up the garbage basket
with the use of a shovel. Peter saw a sack of eggplants pinned under the truck being
removed by its owner. Peter helped the old woman carry the sack to the side of the road
when, all of a sudden, James punched him hard on the right ear, causing him to fall and
roll down the street. Peter ended up sitting on the ground. As he was getting up with his
hands raised, James punched him again. Peter protested, saying he did not do anything
wrong. James answered: "You people from the government are show-off[s]." Peter, still
dizzy while getting up and still with hands raised, was kicked by James on the left side of
the body. Peter fell on the road and rolled anew.25 Feeling very dizzy, Peter tried to pick
up something to throw at James to stop him, because he (Peter) thought James would kill
him. At this moment, Edmond was coming to the aid of Peter, who was in front of the
truck. Edmond carried with him the shovel he used to collect garbage. Edmond tried to
help Peter stand. He put down the shovel on the ground. While in a sitting position, Peter
was able to get hold of the shovel and swing it, hitting James who was approaching him
and about to strike with a clenched fist. With the help of the shovel, Peter stood up and
tried to leave. When James followed Peter, the latter hit him again with the shovel. Peter
saw James boarding a taxi. After feeling a little better, Peter walked to his office and
reported the matter to his supervisor.
Peter, accompanied by his supervisor, voluntarily surrendered to the police authorities.
Per his request, he was brought to the hospital where he met James's wife who hit him on
the back. To avoid trouble, he was brought to the City Jail. Upon posting bail, he went to
the hospital for treatment.
Jimmy Pugoy testified on what he allegedly saw that fateful morning. He recounted that
while he was maneuvering the garbage truck he was driving at Zandueta St., he saw
petitioner Peter Tarapen go down the truck and help an old woman, who was in front of
the truck, carry a sack of eggplants. At that moment, a person (James) went near Peter
and suddenly punched him on the face, causing him to fall and roll down the street. When
Peter stood up with his hands raised, James punched him again on the face, making the
latter fall and roll again. Peter stood up a second time with his hands up. This time, he
said, James delivered a flying kick, which hit Peter on the stomach. Peter fell and rolled
once more. After this, Jimmy no longer saw what happened, because the people had
gathered, and he parked the truck. After parking the vehicle, what he saw was a man lying
on the ground. He went back to the office and gave a report.
Edmond Ferrer narrated that at around 7:00 a.m. of 8 July 2000, he was with Jimmy Pugoy
and Peter Tarapen at Zandueta St. collecting garbage. He was with Peter hanging at the
back of the truck. When the vehicle stopped, Peter alighted and went in front of the
vehicle. Jimmy also went down, taking with him the shovel and the garbage basket. While
Peter was settling some things in front, he placed the garbage inside the basket. After
filling up the basket and before he could load it into the truck, he heard people shouting
in front of the vehicle. As there was a commotion, he proceeded to the front of the vehicle
carrying the shovel he was using. He saw Peter sitting on the ground shaking his head. He
went near Peter, put down the shovel and tried to help him stand up. A person
approached and was about to hit Peter, when the latter got hold of the shovel, swung it
and hit this person. The person remained standing. Peter was able to stand and was
turning around to leave, but the person whom he hit with the shovel was about to follow
him in order to punch him. Peter hit this person one more time, causing the latter to fall
down. Seeing Peter leave, he also left.
Petitioner testified that at the time the incident subject of this case happened, he was in
Zandueta St. to collect garbage. He was riding the garbage truck driven by Jimmy Pugoy.
Since the driver was continuously blowing the horn of the vehicle, he went down the truck
and saw a sack of eggplants under the vehicle. The owner of the sack of eggplants
approached him and asked him to help her. He helped the old woman remove the sack Hundred Thirty Five Thousand Seven Hundred Twenty Pesos (P3,680,800.05), plus costs
under the truck and carry it to the side of the road. After that, he said someone (James) of suit against the accused.29
punched him at the right side of the head, which caused him to fall and sit on the road. As
The trial court gave credence to the testimonies of the prosecution witnesses Molly J.
he was getting up with his hands raised, James said, "Nalastog kayo nga taga-gobierno,"
Linglingen, Silmana Linglingen and Virginia Costales as against the testimonies of defense
and then punched him for the second time. He was a little dizzy and was again getting up
witnesses Jimmy Pugoy, petitioner Peter Tarapen and Edmond Ferrer. The trial court
when he was kicked on the left side of his body. Feeling very dizzy, he tried to pick up
found the prosecution's version of the incident credible. The trial court said Virginia
something to throw at James. While sitting, he got hold of a shovel which he swung, hitting
Costales saw the first part of the incident, which was the heated argument between
James. Peter said he got up to run away, but James followed him. It was then that Peter
petitioner and the victim involving the victim's soiled goods, while Molly J. Linglingen and
hit him again with the shovel. He went to their office and he was accompanied by his
Silmana Linglingen witnessed the second part of the incident when petitioner went to the
supervisor in surrendering to the police. He added that he asked the policemen to bring
back portion of the garbage truck and got a shovel with which he hit the victim from the
him to the hospital, because his ear was aching. It was on 16 July 2000 that he was able
back, twice on the head, resulting in his death. Having had the opportunity to observe
to have a medical examination of his ears.
them, it was convinced that they were telling the truth vis - à-vis the defense witnesses
Dr. Maryjane Tipayno, physician at the BGHMC, testified that she performed an audio who were lying, as can be seen from their hesitant answers and evasive looks when they
logic test on petitioner on 16 June 2000. She found out that petitioner had mild hearing testified for the petitioner who was a co-employee.
loss on the left ear and severe hearing loss on the right ear.26 She said that the hearing
The trial court likewise did not appreciate self-defense in favor of petitioner, who struck
condition of petitioner could not have been self-inflicted. She explained that the hearing
the unarmed victim from the back, twice on the head.
loss in both ears could have started years before. She added that it was Dr. Vinluan who
interviewed the petitioner, and that it was petitioner who told him that the hearing loss On 8 July 2002, petitioner filed a Motion for Reconsideration,30 which the trial court
in his right ear was due to a blunt trauma. denied on 16 July 2002.31 On 23 July 2002, petitioner filed a Notice of Appeal.32 In an
Order33 dated 29 July 2002, the trial court, finding the notice of appeal to have been
After formally offering Exhibits "1" and "2" and with the admission thereof by the trial
seasonably filed, forwarded the records of the case to the Court of Appeals.
court, the defense rested its case.27
On 31 January 2006, the Court of Appeals rendered a decision, affirming with
As rebuttal witnesses, the prosecution presented Molly Linglingen, who said that
modification the decision of the trial court convicting petitioner Peter Chongoy Tarapen
petitioner was standing up when he hit James twice on the head with a shovel. He
of the crime of Homicide, the decretal portion reading:
explained that James was standing with his back turned, when Peter came from behind
and hit him.28 WHEREFORE, in view of all the foregoing, the decision dated June 20, 2002 of Branch 3 of
the Regional trial Court of Baguio City in Criminal Case No. 17792-R finding accused-
On 20 June 2002, the trial court convicted petitioner of Homicide in a decision the
appellant Peter Tarapen y Chongoy guilty beyond reasonable doubt of the crime of
dispositive portion of which reads:
homicide is AFFIRMED with modification. Accused-appellant is sentenced to suffer the
WHEREFORE, the Court finds accused Peter Tarapen GUILTY beyond reasonable doubt penalty of eight (8) years of prision mayor, AS MINIMUM, to fourteen (14) years of
for the crime of Homicide and he is hereby sentenced to suffer the penalty of reclusion temporal, AS MAXIMUM, and ordered to pay the heirs of the victim James Lacbao
imprisonment at the National Penitentiary, Muntinlupa City from Fourteen (14) Years as Pangoden the following amounts: P51,549.25 in actual damages, P50,000.00 as moral
Minimum to Twenty (20) Years as Maximum. Peter Tarapen shall also indemnify private damages, P50,000.00 as civil indemnity and the sum of P1,960,200.00 representing lost
complainant Patricia Pangoden the following amounts: One Hundred Ninety Five earnings.34
Thousand Eighty Pesos and 05/100 (P195,080.05), representing the expenses for
On 8 March 2006, petitioner filed a Motion for Reconsideration,35 on which the Office of
hospitalization, funeral and burial; Moral Damages to Patricia Pangoden in the amount of
the Solicitor General (OSG) filed its Comment.36 On 6 July 2006, the Court of Appeals
Three Hundred Thousand Pesos (P300,000.00) and Death Indemnity of Fifty Thousand
denied said motion.37
Pesos (P50,000.00), and Loss of Earning Capacity in the amount of Three Million One
On 31 August 2006, petitioner, via registered mail, filed a Petition for Review with this
Court, seeking the reversal of the decision of the Court of Appeals.38
In our Resolution39 dated 2 October 2006, respondent People of the Philippines, through
the OSG, was required to file its Comment on the petition. After three motions for
extension to file comment on the petition, which were granted by this Court, the OSG filed
its Comment on 5 February 2007.40 On 12 March 2007, petitioner was required to file a
Reply to the Comment, which he did on 11 December 2007.41
On 18 February 2008, the Court resolved to give due course to the Petition for Review on
Certiorari and required the parties to submit their respective memoranda within thirty
(30) days from notice. Petitioner and respondent filed their respective memoranda on 2
May 2008 and 10 April 2008.42
Petitioner assails his conviction, arguing that both trial courts:
I. Erred in giving credence to the prosecution witnesses, despite the grave inconsistencies
in their testimonies and not considering the testimonies of the witnesses for the defense
showing manifest bias against the accused.
II. Erred in not acquitting the accused when the defense had sufficiently proved the
existence of facts proving that indeed the accused was defending himself from James
Pangoden.
III. Erred in not acquitting the accused based on reasonable doubt.43
On the first assigned error, petitioner contends that the testimonies of Molly and Silmana
Linglingen that there was no prior quarrel or exchange of words between petitioner and
James before the former hit the latter with a shovel, are contrary to human experience,
because petitioner could not have taken the life of James, whom he did not personally
know, for no reason at all.
This contention is untenable.
A review of the testimonies of both Molly and Silmana Linglingen shows they never said
that petitioner and the victim did not have any prior quarrel or exchange of words before
Peter hit James with the shovel. What they said was that they never witnessed any quarrel
or exchange of words between Peter and James. They, however, declared in unison that
they saw petitioner get a shovel from the back of the garbage truck and, coming from
behind, twice struck James on the head with it. Both Molly and Silmana Linglingen never
witnessed the events prior to Peter's act of getting the shovel. This void was substantially
filled up by the testimony of Virginia Costales, who actually witnessed the altercation
between the petitioner and the victim. Through the testimony of Mrs. Costales, it became
clear why petitioner got the shovel, which he used in striking James twice on the head. By
combining the testimonies of the three ladies, a picture of the incident has been wholly
painted. The rage that Peter had in him was brought about by his squabble with James.
The defense cannot, therefore, claim that Peter took the life of James for no reason at all.
Petitioner brands Molly and Silmana Linglingen as biased witnesses, thus, unreliable,
because they were town mates and co-vendors of the victim. The fact that these two
witnesses were the victim's town mates and co-vendors did not necessarily make them
biased witnesses. It is well-settled that the mere relationship of a witness to the victim
does not impair the witness' credibility. On the contrary, a witness' relationship to a
victim of a crime would even make his or her testimony more credible, as it would be
unnatural for a relative, or a friend as in this case, who is interested in vindicating the
crime, to accuse somebody other than the real culprit.44 A witness is said to be biased
when his relation to the cause or to the parties is such that he has an incentive to
exaggerate or give false color to his statements, or to suppress or to pervert the truth, or
to state what is false.45 To warrant rejection of the testimony of a relative or friend, it must
be clearly shown that, independently of the relationship, the testimony was inherently
improbable or defective, or that improper or evil motives had moved the witness to
incriminate the accused falsely.46
The friendship of Molly and Silmana Linglingen with the victim, per se, did not impair
their credibility. We, like both lower courts, are convinced that they were telling the truth.
Moreover, the defense failed to show any evidence that prosecution witnesses Molly and
Silmana Linglingen had improper or evil motives to testify falsely against petitioner. This
being the case, their testimonies are entitled to full faith and credit.
The defense accuses the prosecution witnesses of deliberately suppressing material
evidence favorable to the petitioner. It thus argues that it may be safely presumed that
such evidence, having been willfully suppressed, would be adverse if produced.
We do not find any suppression of evidence by the prosecution. The defense failed to
specify which evidence was suppressed. It simply made a general statement that the
prosecution witnesses allegedly did not tell the truth and thus deliberately suppressed
material evidence favorable to the petitioner. The adverse presumption of suppression of
evidence is not applicable when (1) the suppression is not willful; (2) the evidence
suppressed or withheld is merely corroborative or cumulative; (3) the evidence is at the
disposal of both parties; and (4) the suppression is an exercise of a privilege.47 In the case
at bar, the prosecution witnesses who allegedly suppressed material evidence were
presented in court and were cross-examined by the defense counsel. How then can the
defense claim there was suppression? The defense counsel was able to question these
witnesses, but failed to elicit the answer he wanted or needed to hear for the exoneration
of his client.
The defense attacks the credibility of Virginia Costales by pointing out that her testimony
in court, that she did not see petitioner and the victim engage in a fistfight, contradicts
her declaration in her sworn statement that that two engaged in a fistfight.
Such inconsistency will not discredit her. It is settled that certain discrepancies between
declarations made in an affidavit and those made on the witness stand seldom could
discredit the declarant. Sworn statements, being taken ex parte, are almost always
incomplete and often inaccurate for various reasons, sometimes from partial suggestion
or for want of suggestion and inquiries. They are generally inferior to the testimony of
the witness given in open court. Our case law is unequivocal in saying that the testimony
of a witness prevails over an affidavit. In short, affidavits are generally subordinated in
importance to open-court declarations; or, more bluntly stated, whenever there is
inconsistency between an affidavit and the testimony of a witness in court, the testimony
commands greater weight.48 The Court has consistently ruled that the alleged
inconsistencies between the testimony of a witness in open court and his sworn
statement before the investigators are not fatal defects that would justify the reversal of
a judgment of conviction.49 In this case, when Mrs. Costales was confronted with this
contradiction, she explained that she never told the police that the petitioner and the
victim had a fistfight. What she said was they had a quarrel; that is, they faced each other
and exchanged words.
The defense tries to destroy the version of Molly and Silmana Linglingen that the victim
was hit from behind by arguing that same is not corroborated by medical findings. Molly
and Silmana Linglingen's claim that James was hit on the right side of the head was,
according to the defense, negated by the findings of Dr. Mensalvas that James suffered
injuries on the "left frontoparietal and left frontotemporo parietal" areas of his head. The
findings of Dr. Mensalvas mean that James was facing Peter when hit by the shovel
contrary to the prosecution's claim that James was hit by Peter from behind.
We do not agree.
The defense relies too much on the findings made by Dr. Lindo Mensalvas and completely
omits the findings made by Dr. Rizal Leo Cala. It must not be forgotten that the victim was
brought to two hospitals where the attending doctors issued separate medico-legal
certificates. The medico-legal certificate50 issued by Dr. Cala of the BGHMC was marked
Exh. "D." The one issued by Dr. Mensalvas was marked Exh. "C."
On the witness stand, Dr. Cala read his findings as follows:
"Skull Fracture" meaning there is a break in the skull bone, "Linear" which is a straight
line fracture, "parietal" area on the right side of the head, then we have "Epidural
hematoma" it is a blood clot at the right side of the head.51
When cross-examined, he explained his findings as follows:
q Both injuries you found were on the front parietal area?cra lawlibrary
a Yes, Sir.
q Will you please demonstrate to us?cra lawlibrary
a (Witness demonstrating by pointing to the right side of his head.)
q Doctor, while you were demonstrating, the linear fracture, is it perpendicular to the
head?cra lawlibrary
a I am sorry but it was injury to the right side of the head, Sir.
q Only part of the right ear?cra lawlibrary
a Yes, sir.
q If I am facing you, it is on your?cra lawlibrary
a Right, Sir.
q Right side on your part. Did you find any injury on the left side?cra lawlibrary
a No, Sir.52
From the medico-legal certificate issued by Dr. Cala and with his testimony in court, it is
clear that the victim suffered injuries on the right side of his head. Thus, the claim of Molly
and Silmana Linglingen that the victim was struck from behind on the right side of his
head is consistent with the findings of Dr. Cala.
Dr. Mensalvas, on the other hand, testified that the victim sustained four injuries, three of
which were on the left side of the head and one on the right side. The medical certificate
he issued states that the victim was confined for the following injuries:
1. ACCI; CEREBRAL CONTUSSION
2. EPIDURAL HEMATOMA, LEFT FRONTOPARIETAL AREA
3. SUTURED SCALP LACERATION, RIGHT TEMPOROPARIETAL AREA
4. SCALP CONTUSSION, LEFT FRONTOTEMPORO PARIETAL AREA WITH UNDERLYING
LINEAR FRACTURE OF THE SKULL EXTENDING FROM THE LEFT FRONTAL TO THE LEFT
TEMPORAL BONE.53
The question now is: which medical findings should this Court believe?cra lawlibrary
This Court believes in the findings made by Dr. Cala as contained in the medico-legal
certificate he issued showing that the victim suffered injuries on the right side of his head,
consistent with the declarations of prosecution witnesses that the victim was, from
behind, struck with a shovel twice on the right side of the head. We give more weight to
this medical certificate, because the same was issued by a government doctor. By actual
practice, only government physicians, by virtue of their oaths as civil service officials, are
competent to examine persons and issue medical certificates which will be used by the
government.54 As such, the medical certificate carries the presumption of regularity in the
performance of his functions and duties. Moreover, under Section 44, Rule 130,55 Revised
Rules of Court, entries in official records made in the performance of official duty are
prima facie evidence of the facts therein stated. Dr. Cala's findings that the victim
sustained injuries on the right side of his head are, therefore, conclusive in the absence of
evidence proving the contrary, as in this case. We cannot consider the contents of the
medical certificate issued by Dr. Mensalvas sufficient to controvert the findings of Dr.
Cala. As held by this Court, an unverified medical certificate not issued by a government
physician is unreliable.56
Even assuming arguendo that we give more weight to the medical certificate issued by
Dr. Mensalvas, this does not mean that the testimonies of Molly and Silmana Linglingen
shall be disbelieved. It is noted that Dr. Mensalvas testified that the victim sustained a
wound on the right side of his head, possibly caused by a steel shovel.57 Such a finding is
consistent with the claim of Molly and Silmana Linglingen that the victim was hit on the
right side of the head. Though there can be inconsistencies of the testimonies of the
witnesses with Dr. Mensalvas's other findings (i.e., injuries on the left portion of the head)
this does not mean that we should totally doubt and discard the other portions of their
testimonies.
Well-settled is the rule that the testimony of a witness may be believed in part and
disbelieved in another, depending on the corroborative evidence or the probabilities and
improbabilities of the case. Where a part of the testimony of a witness runs counter to the
medical evidence submitted, it is within the sound discretion of the court to determine
which portions of the testimony to reject as false and which to consider worthy of belief.58
From the two medical certificates issued, what cannot be doubted is the fact that the
victim sustained head injuries, whether on the left or the right, which caused his demise.
We find the testimonies of the prosecution eyewitnesses more credible and convincing
than those of the defense eyewitnesses. When it comes to credibility, the trial court's
assessment deserves great weight and is even conclusive and binding, if not tainted with
arbitrariness or oversight of some fact or circumstance of weight and influence. The
reason is obvious. Having the full opportunity to observe directly the witnesses'
deportment and manner of testifying, the trial court is in a better position than the
appellate court to evaluate testimonial evidence properly.59
The Court of Appeals further affirmed the findings of the RTC. In this regard, it is settled
that when the trial court's findings have been affirmed by the appellate court, said
findings are generally conclusive and binding upon this Court. We find no compelling
reason to deviate from their findings.
Petitioner claims that the trial court judge was not able to observe the demeanor of the
prosecution witnesses, because they were looking at the court interpreter when they
were testifying. We find this untenable. The trial court judge was emphatic in saying that
he had the chance to see the face of the witness while she testified.60
On the second and third assigned errors, petitioner admits killing James but invokes self-
defense. He claims that the victim was the unlawful aggressor and that he (petitioner) did
not provoke the victim.
Article 11, paragraph (1) of the Revised Penal Code, provides for the elements and/or
requisites in order that a plea of self-defense may be validly considered in absolving a
person from criminal liability, viz:
ART. 11. Justifying circumstances. - The following do not incur any criminal liability:
1. Anyone who acts in defense of his person or rights, provided that the following
circumstances concur;
First. Unlawful aggression;
Second. Reasonable necessity of the means employed to prevent or repel it;
Third. Lack of sufficient provocation on the part of the person defending himself.
Having admitted that he killed James, the burden of evidence that one acted in self-
defense shifted to petitioner. Like an alibi, self-defense is inherently weak, for it is easy to
fabricate.61 It is textbook doctrine that when self-defense is invoked, the burden of
evidence shifts to the accused to show that the killing was justified, and that he incurred
no criminal liability therefor. He must rely on the strength of his own evidence and not
on the weakness of the prosecution's evidence, for, even if the latter were weak, it could
not be disbelieved after his open admission of responsibility for the killing. Hence, he
must prove the essential requisites of self-defense as aforementioned.62
Unlawful aggression is a condition sine qua non for the justifying circumstance of self-
defense, whether complete or incomplete.63 Unlawful aggression presupposes an actual,
sudden, and unexpected attack, or imminent danger thereof, and not merely a threatening
or intimidating attitude.64 There must be actual physical force or a threat to inflict
physical injury. In case of a threat, it must be offensive and positively strong so as to
display a real, not imagined, intent to cause injury.65
We agree with the Court of Appeals that petitioner failed to clearly and convincingly
prove self-defense, whether complete or incomplete.
We confirm the observation of the trial court. A circumspect scrutiny of accused-
appellant's version of what happened likewise leaves this Court unconvinced that he
killed the victim James Pangoden in self-defense.
First, accused-appellant's claim that the victim James Pangoden, suddenly and without
provocation, boxed him on his right ear is simply unbelievable. By his own account, he
(accused-appellant) was at that moment helping a road vendor carry her sack of
eggplants away from the path of the truck. If this is true, then his testimony that James
Pangoden attacked and boxed him for no reason at all loses credibility. Testimonies to be
believed must not only come from the mouth of credible witnesses but should by
themselves be credible, reasonable, and in accord with human experience.
Second, it is likewise inconceivable how accused-appellant could have hit the victim
James Pangoden twice in the head while he (accused-appellant) was allegedly in a sitting
position and holding the shovel by the middle part of its shaft. Interestingly also, while
accused-appellant and his witness testified that he was in a "sitting" position when he hit
James Pangoden with the shovel, accused-appellant portrayed a different account when
asked during cross-examination to demonstrate how he hit the victim, viz:
Q: Now, how did you hit Pangoden with the shovel, demonstrate it to the Court. All right
you can step down from the witness stand (Witness demonstrating.)
For the record, witness was in a kneeling position when he got the shovel.
A: I was down on the ground, and I was groping (sic) to somebody and I was able to get
hold of the shovel, that was the time I swang (sic) it towards him.
Q: You have not demonstrated how you hit Pangoden with the shovel?cra lawlibrary
For the record, witness is in a kneeling position when he allegedly picked up the shovel
holding it in the middle part. With his two hands and swang (sic) it upwards towards his
left.
For the record, accused held the shovel on the middle part of the shaft, your Honor, not
on the handle.
Third, it simply goes against the grain of human experience for the victim James Pangoden
to persist in his attack against accused-appellant after getting hit in the head with a steel
shovel, considering that he is unarmed and had nothing to match accused-appellant's
weapon on hand. That James Pangoden still had the resolution and power for a second
assault on accused-appellant, after getting hit with a steel shovel in the head, flouts
ordinary human capacity and nature. In contrast, accused-appellant would claim that he
"fell down" and "felt dizzy" after getting boxed on the right side of his head by James
Pangoden with his bare fist.
Fourth, accused-appellant himself admitted walking away from the crime scene
immediately after the incident. As we see it, this actuation on his part is contrary to his
assertion of self-defense. Flight strongly indicates a guilty mind and betrays the existence
of a guilty conscience, for a righteous individual will not cower in fear and unabashedly
admit the killing at the earliest possible opportunity if he were morally justified in doing
so.
Finally, the nature and number of the fatal injuries inflicted upon James Pangoden negate
accused-appellant's claim of self-defense. Said victim suffered cerebral contusion,
epidural hematoma, scalp laceration and skull fracture, which directly caused his death.
If accused-appellant hit the victim just to defend himself, it certainly defies reason why
he had to aim for the head and do it twice. Indeed, the nature, number and location of the
wounds sustained by the victim belie the assertion of self-defense since the gravity of said
wounds is indicative of a determined effort to kill and not just to defend.
xxx
But even assuming arguendo that accused-appellant was able to establish the element of
unlawful aggression, still, this Court will rule out self-defense.
It is undisputed that James Pangoden was unarmed while accused-appellant was armed
with a steel shovel. There was no reasonable necessity for accused-appellant to use a steel
shovel to repel the attack of an unarmed man. Moreover, the eyewitnesses' account of
how accused-appellant uncaringly threw the soiled eggplants towards the direction of
James Pangoden's goods would negate the absence of sufficient provocation on the part As to actual damages, the heirs of the victim are entitled thereto, because said damages
of accused-appellant. Thus, the second and third requisites for self-defense to be amounting to P51,549.25 were duly proved by receipts. It is necessary for a party seeking
successfully invoked, namely, reasonable necessity of the means employed to repel the actual damages to produce competent proof or the best evidence obtainable, such as
attack and lack of sufficient provocation on the part of the accused, are not present in this receipts, to justify an award therefor.71
case.66
Moral damages must also be awarded because these are mandatory in cases of murder
We now go to the imposition of the penalty. We agree with the Court of Appeals when it and homicide, without need of allegation and proof other than the death of the victim.72
appreciated in favor of the petitioner the mitigating circumstance of voluntary surrender. The award of P50,000.00 as moral damages is in order.
It was established that a few hours after the incident, petitioner submitted himself to his
The award of P25,000.00 as temperate damages in homicide or murder cases is proper
supervisors, who, in turn, surrendered him to the police authorities.
when no evidence of burial and funeral expenses is presented in the trial court.73 Under
Petitioner is guilty of Homicide for having killed James Pangoden. The penalty for Article 2224 of the Civil Code, temperate damages may be recovered, as it cannot be
homicide under Article 249 of the Revised Penal Code is reclusion temporal. However, denied that the heirs of the victim suffered pecuniary loss, although the exact amount was
considering that there is one mitigating circumstance and no aggravating circumstance not proved.74 In the case on hand, temperate damages cannot be awarded, because
in the commission of the crime, the imposable penalty, following Article 64(2) of the evidence of expenses for burial and funeral has been presented for which actual damages
Revised Penal Code, is reclusion temporal in its minimum period or within the range of have been awarded.
twelve (12) years and one (1) day to fourteen (14) years and eight (8) months. Applying
As regards exemplary damages, Article 2230 of the Civil Code allows the award thereof
the Indeterminate Sentence Law, the maximum penalty to be imposed shall be taken from
as part of the civil liability when the crime was committed with one or more aggravating
the minimum period of reclusion temporal, while the minimum shall be taken from within
circumstances.75 There being no aggravating circumstance that accompanied the
the range of the penalty next lower in degree, which is prision mayor or from six (6) years
commission of the crime, exemplary damages cannot be awarded.
and one (1) day to twelve (12) years.
The computation of the Court of Appeals with respect to lost earning capacity is correct.
The Court of Appeals sentenced petitioner to suffer the penalty of eight (8) years of
At the time of his death, the victim was 31 years old. His gross annual income was
prision mayor, as minimum, to fourteen (14) years of reclusion temporal, as maximum. We
P120,000.00 because he was earning P10,000.00 monthly. Living expenses are estimated
find this to be in order.
at 50% of the gross annual income. Loss of earning capacity is computed by applying the
With respect to award of damages, the trial court awarded to the heirs of the victim the following formula:76
following amounts: P195,080.05 as actual damages; P300,000.00 as moral damages;
P50,000.00 as death indemnity; and P3,135,720.00 for loss of earning capacity. Net Earning = life expectancy x [Gross ' living expenses
Capacity [2/3(80-age at death)] Annual (50% of GAI)]
The Court of Appeals, except for the award of death indemnity, reduced the awards given Income
by the trial court as follows: P51,549.25 as actual damages; P50,000.00 as moral damages (GAI)
and P1,960,200.00 for lost income.
When death occurs due to a crime, the following damages may be awarded: (1) civil = [2/3(80-31)] x [(GAI) ' (50% of GAI)]
indemnity ex delicto for the death of the victim; (2) actual or compensatory damages; (3)
moral damages; (4) exemplary damages; and (5) temperate damages.67 = 2 (49) x [P120,000 - P60,000]
3
Civil indemnity is mandatory and granted to the heirs of the victim without need of proof
other than the commission of the crime.68 Under prevailing jurisprudence,69 the award of = [98/3] x [P60,000]
P50,000.00 to the heirs of the victim as civil indemnity is in order.70
 = [32.67] x [P60,000]
Net Earning = P1,960,200.00
Capacity of the
victim
WHEREFORE, all the foregoing considered, the decision of the Court of Appeals in CA-G.R.
CR No. 26636, dated 31 January 2006, is AFFIRMED in toto. Costs against the petitioner.
SO ORDERED.
DISQUALIFICATION BY REASON OF DEATH OR INSANITY
BABAO VS PEREZ
3. CLAIM AGAINST ESTATES OF DECEASED PERSONS; PAROL EVIDENCE ON MATTERS
OCCURRING BEFORE DEATH, NOT ADMISSIBLE. — In the action for the recovery of the
parcel of land in question belonging to the deceased C.P., the plaintiff allege fraud in the sale
thereof in that it was made in violation of the verbal agreement into between the deceased
owner and the deceased S.B., whereby the latter bound himself to improve the said forest
land and convert it into a veritable farm, and that in consideration of the said undertaking,
the deceased owner bound herself to give and deliver to S.B. or his wife, 1/2 of the whole
area of said land. Defendants objected to the admission of the testimony of the plaintiff,
judicial administrator of the estate of the late S.B., as to what occurred between C.B. and S.B.
with regard to the agreement, on the ground that said testimony was prohibited by section
26 (c) of Rule 123 of the Rules of Court. The trial court overruled the opposition saying that
said did not apply where the complaint against the estate of a deceased person alleges fraud,
citing the case of Ong Chua v. Carr, 53 Phil. 980. Held: The court is in error because if in that
case the witness was allowed to testify it was because the existence of fraud was first
established by sufficient and competent evidence. Here, however, the alleged fraud is
predicated upon the existence of the agreement itself which violates the rule of petitio
principii. Evidently, the fraud to exist must be established by evidence aliunde and not by the
same evidence which is sought to be prevented.
1. STATUTES OF FRAUDS; CONTRACTS WHICH ARE NOT TO BE PERFORMED WITHIN
ONE YEAR; PARTIAL PERFORMANCE BY ONE PARTY, EFFECT OF. — Contracts which by
their terms are not to be performed within one year may be taken out of the Statute of
Frauds through performance by one party thereto. In order, however through
performance of the contract may take the case out of the operation of the statute, it must
appear clear that the full performance has been made by one party within one year, as
otherwise the statute would apply.
2. ID.; PAROL CONTRACT FOR THE SALE OF LAND; ENFORCEMENT OF CONTRACT ON
THE GROUND OF PART PERFORMANCE. — Where the contract is vague and ambiguous,
the doctrine of part performance cannot be invoked to take the case out of the operation
of the statute of frauds, Obviously, there can be no part performance until there is a
definite and complete agreement between the parties. In order to warrant the specific
enforcement of parol contract for the sale of land, on the ground of part performance, all
the essential terms of the contract must be established by competent proof, and shown
to be definite, certain, clear and unambiguous. (Cuyugan, v. Santos, 34 Phil., 100, 101.)
3. CLAIM AGAINST ESTATES OF DECEASED PERSONS; PAROL EVIDENCE ON MATTERS
OCCURRING BEFORE DEATH, NOT ADMISSIBLE. — In the action for the recovery of the
parcel of land in question belonging to the deceased C.P., the plaintiff allege fraud in the
sale thereof in that it was made in violation of the verbal agreement into between the
deceased owner and the deceased S.B., whereby the latter bound himself to improve the
said forest land and convert it into a veritable farm, and that in consideration of the said
undertaking, the deceased owner bound herself to give and deliver to S.B. or his wife, 1/2
of the whole area of said land. Defendants objected to the admission of the testimony of
the plaintiff, judicial administrator of the estate of the late S.B., as to what occurred
between C.B. and S.B. with regard to the agreement, on the ground that said testimony
was prohibited by section 26 (c) of Rule 123 of the Rules of Court. The trial court
overruled the opposition saying that said did not apply where the complaint against the
estate of a deceased person alleges fraud, citing the case of Ong Chua v. Carr, 53 Phil. 980.
Held: The court is in error because if in that case the witness was allowed to testify it was
because the existence of fraud was first established by sufficient and competent evidence.
Here, however, the alleged fraud is predicated upon the existence of the agreement itself
which violates the rule of petitio principii. Evidently, the fraud to exist must be
established by evidence aliunde and not by the same evidence which is sought to be
prevented.
DECISION
BAUTISTA ANGELO, J.:
This is an action to recover one-half (½) of a parcel of land containing an area of 156
hectares situated in San Juan, Batangas, plus the value of the produce gathered thereon
from August, 1947 until actual recovery and in the alternative, to recover the sum of
P47,000 representing reimbursement of the amount of useful and necessary expenses
incurred to clear and improve the aforesaid land.
Plaintiff is the judicial administrator of the estate of the late Santiago Babao while
defendant Florencio Perez is the judicial administrator of the estate of the late Celestina
Perez. The other defendants are purchasers and actual owners of portions of the land
which is sought to be recovered in the present litigation.
The complaint alleges that Celestina Perez was in her lifetime the owner of the parcel of
land in question which was not registered either under Act 496 or under the Spanish
Mortgage Law; that sometime in 1924 when the deceased Santiago Babao married Maria
Cleofe Perez, niece of Celestina Perez, the latter and the former entered into a verbal
agreement whereby Santiago Babao bound himself to improve the land by levelling and
clearing all the forest trees standing thereon and planting in lieu thereof coconuts, rice,
corn and other crops such as bananas and bamboo trees, and to act at the same time as
administrator thereof during the lifetime of Celestina Perez, all expenses for labor and
materials to be at his cost, in consideration of which Celestina in turn bound herself to
convey to Santiago Babao or his wife 1/2 of the land, together with all the improvements
thereon upon her death; that pursuant to said verbal agreement, Santiago Babao in 1924
left his job as administrator of the Llana Estate in San Juan, Batangas for which he was
receiving a salary of P150 a month, and started levelling and clearing the land having
planted in an area of 50 hectares 5,000 coconuts trees, and rice and corn in another area
of 70 hectares, leaving out only about 50 hectares unimproved, all of which having been
administered by him from 1924 to 1946; that for clearing and improving the portions of
land above-mentioned, he incurred expenses amounting to P7,400 which added to his
salary as administrator from 1924 to 1946 at the rate of P150 a month amounting to
P39,600, makes a total of P47,000; that in violation of the aforesaid verbal agreement,
Celestina Perez, acting through Leovigildo Perez, to whom she extended a power of
attorney to sell, sold few days before she died about 127 1/2 hectares of the land in
question in consequence of which Santiago Babao was deprived of the possession and
administration thereof from 1945; that said sales were fictitious and were made in clear
violation of the oral agreement made between Celestina Perez and Santiago Babao and as
such the same are null and void; that Celestina Perez died on August 24, 1947 as a result
of which intestate proceedings were instituted for the settlement of her estate and one
Florencio Perez was named as judicial administrator; that Santiago Babao died on
January 6, 1948 and as a consequence intestate proceedings were instituted for the
settlement of his estate and Bienvenido Babao was appointed judicial administrator; and
that in the event the estate of Santiago Babao failed to recover the 1/2 portion of the land
herein litigated, said estate would suffer an irreparable damage of not less than P366,700
representing fruits which it has failed to receive during the last 20 years. Wherefore,
plaintiff prayed for the conveyance of 1/2 portion of the land in question and for
annulment of the sales of the portion thereof for having been made fictitiously, and in the
alternative, for judgment in plaintiff’s favor for the sum of P47,000 representing the
amount of useful and necessary expenses incurred by Santiago Babao in improving the
land in line with the oral agreement.
Defendants denied plaintiff’s claim that a verbal agreement was entered into between
Celestina Perez and Santiago Babao relative to the clearing, improving and administering
the land belonging to the former having an area of 156 hectares, as well as the other claim
that Santiago Babao had actually cleared and improved a great portion thereof at a cost
of around P7,400. They alleged that in 1924 and for many years prior thereto, the land in
question had already been cleared and cultivated for agricultural purposes with an
exception of a portion of 50 hectares; that said land was cleared and cultivated due partly
to the effort made by Celestina’s husband, Esteban de Villa, her overseers and tenants,
and partly to the "trusco" system employed by them whereby persons were allowed to (1) Declaring the sales of Lupang Parang by and between the defendants, fraudulent and
clear the land and plant thereon and from the harvest were compensated according to a fictitious, null and void;
graduated scale of division varying from year to year; that the coconut trees, banana
plants and bamboo trees now standing thereon were planted not by Santiago Babao nor
at his expense but by the tenants of the spouses Esteban de Villa and Celestina Perez who (2) Ordering defendant Florencio Perez as administrator of the testate estate of the
were duly compensated according to the "trusco" system; that although Santiago Babao deceased Celestina Perez, to pay plaintiff the sum of P3,786.66 annually from August 25,
and Maria Cleofe Perez were married in 1924, the former did not have anything to do 1947 until delivery of the land to the latter, with interest thereon at the rate of 6 per cent
with the land in question for Esteban de Villa was then still living and actively managed per annum from the date of the filing of the complaint;
the same with the help of his overseer and tenants until he died in 1930; that it was only
in that year when Santiago Babao began administering the land in the capacity of a
nephew of Celestina until 1935 when Celestina, disgusted with the conduct of Santiago, (3) Divesting the title of defendants over 1/2 of Lupang Parang both in quantity and
left the company of Santiago and his wife and went to live with her nephew Bernardo quality and vesting title thereover in plaintiff pursuant to section 10 of Rule 39. To carry
Perez until her death in 1947; that since then Celestina Perez prohibited Santiago from out this judgment, the Clerk of Court is hereby appointed representative of this Court to
interfering with the administration of the land and designated another person in his designate a disinterested surveyor for the necessary survey and division, the expenses
place, and for the work he did from 1930 to 1935, he was more than compensated therefor to be defrayed half and half by plaintiff and Florencio Perez;
because the proceeds of the harvests during said years were all given to him and his wife
and Celestina was given only what was barely sufficient for her maintenance.
(4) Ordering defendants to surrender the possession of the half adjudicated and vested
in favor of the plaintiff after the same has been designated under the preceeding
Defendants also alleged that the sales made by Celestina Perez through her attorney-in- paragraph; and
fact Leovigildo Perez of several portions of the land were not fictitious as alleged but were
made with full knowledge and authority of Celestina who executed in favor of Leovigildo
Perez a power of attorney under the authority of a notary public in the presence of
(5) To pay the costs."cralaw virtua1aw library
Santiago Babao himself who did not interpose any objection to the execution of said
power of attorney and, therefore, said sales are real, valid and genuine, having been
executed in accordance with law. Defendants prayed that the complaint be dismissed
Defendants in due time took the case on appeal to the Court of Appeals where the parties
with costs, after awarding to them moral damages in the amount that the court may deem
submitted their respective briefs within the reglementary period, and thereafter the
proper to fix.
court rendered judgment reversing in toto the decision appealed from and dismissing the
case without pronouncement as to costs. But when its attention was called, thru a proper
motion, that that court acted without jurisdiction because the amount involved was more
After hearing, the court rendered judgment the dispositive part of which
than P50,000, the court in a resolution entered on August 14, 1954 set aside its decision
reads:jgc:chanrobles.com.ph
and forwarded the case to us to have the case remanded to the Court of Appeals proved
futile.

"WHEREFORE, judgment is rendered in favor of the plaintiff and against the defendants,
While this case was pending in the lower court, counsel for appellants filed a motion to
dismiss on the ground, among others, that the alleged verbal agreement between
Santiago Babao and Celestina Perez was unenforceable under the Statute of Frauds. The
trial court denied this motion on the ground that it appears from the complaint "that
Santiago fully complied with his part of the oral contract between the parties and that this
is an action not only for specific performance but also for damages." Consequently, the
court held that the Statute of Frauds cannot be invoked for the reason that "performance
by one party of his part of the contract takes the case out of the statute." And pursuant to
such ruling, when the case was tried on the merits, the court overruled all objections of
counsel for appellants to the introduction of oral testimony to prove the alleged verbal
agreement.
The important question then to be determined is whether or not the alleged verbal
agreement falls within the prohibition of the Statute of Frauds.
This statute, formerly incorporated as Section 21 of Rule 123 of our Rules of Court, is now
found in Article 1403 of the new Civil Code, which provides, in so far as pertinent to this
case, as follows:jgc:chanrobles.com.ph
"In the following cases an agreement hereafter made shall be unenforceable by action
unless the same, or some note or memorandum thereof, be in writing, and subscribed by
the party charged, or by his agent, evidence therefore, of the agreement cannot be
received without the writing, or secondary evidence of its contents;
"(a) An agreement that by its terms is not to be performed within a year from the making
thereof.
x x x But the trial court expressed the view that the statute does not apply because it assumed
"(e) An agreement . . . for the sale of real property or of an interest therein."cralaw
virtua1aw library
Appellants contend that the alleged verbal agreement falls under paragraphs (a) and (e)
above-quoted because the same may be considered as an agreement which by its terms
is not to be performed within one year from the making thereof, or one which involves a
sale of real property or of an interest therein. If this premise is correct, appellants
contend, then the trial court erred in allowing the introduction of parole evidence to
prove the alleged agreement over the vigorous objection of counsel for Appellants.
That the alleged verbal agreement is one which by its terms is not to be performed within
one year is very apparent from the allegations of the complaint. Thus, it is therein alleged
that the agreement was allegedly made in 1924 and by its terms Santiago Babao bound
himself (1) to improve all the 156 hectares of forest lands by levelling and clearing all the
forest trees and planting thereon coconuts, rice, corn and other crops such as bananas
and bamboo trees, and (2) to act at the same time as administrator of said land and
improvements during the lifetime of Celestina Perez. And in consideration of such
undertaking, Celestina Perez "bound herself to give and deliver, either to Santiago Babao
or his wife Cleofe Perez, one-half (1/2) of the whole area of said land as improved with
all the improvements thereon upon her death." It is also alleged in the complaint that
Celestina Perez died on August 24, 1947, or 23 years after the making of the alleged
agreement, while Santiago Babao died on January 6, 1948. From the above terms,
therefore, it is not difficult to see that the undertaking assumed by Santiago Babao which
was to clear, level and plant to coconut trees and other plants 156 hectares of forest land
could not be accomplished in one year. In fact, the alleged improvements were
supposedly accomplished during the lifetime of Celestina, which lasted over a period of
23 years, and even then not all was cleared and planted but only a portion thereof.
Another part of his undertaking is that he is to administer the land during the lifetime of
Celestina, and as we have already said, her death occurred 23 years after the agreement.
that Santiago Babao fully complied with his part of the oral contract between the parties,
and in its opinion "performance by one party of his part of the contract takes the case out
of the statute." Even if this assumption were correct, still we find one flaw in its logic
which fully nullifies it for it fails to consider that in order that a partial performance of
the contract may take the case out of the operation of the statute, it must appear clear
that the full performance has been made by one party within one year, as otherwise the
statute would apply. Thus, the rule on this point is well stated in Corpus Juris in the
following wise: "Contracts which by their terms are not to be performed within one year,
may be taken out of the statute through performance by one party thereto. All that is
required in such case is complete performance within the year by one party, however
many years may have to elapse before the agreement is performed by the other party. But
nothing less than full performance by one party will suffice, and it has been held that, if
anything remains to be done after the expiration of the year besides the mere payment of
money, the statute will apply." 1 (Italics supplied). It is not therefore correct to state that
Santiago Babao has fully complied with his part within the year from the alleged contract
in question.
"When, in an oral contract which, by its terms, is not to be performed within one year
from the execution thereof, one of the contracting parties has complied within the year
with the obligations imposed on him by said contract, the other party cannot avoid the
fulfillment of those incumbent on him under the same contract by invoking the statute of
frauds because the latter aims to prevent and not to protect fraud." (Shoemaker v. La
Tondeña, Inc. 68 Phil., 24.)
"The broad view is that the statute of Frauds applies only to agreements not to be
performed on either side within a year from the making thereof. Agreements to be fully
performed on one side within the year are taken out of the operation of the statute."
(National Bank v. Philippine Vegetable Oil Co., 49 Phil., 857, 858.)
Assuming arguendo that the agreement in question falls also under paragraph (a) of
Article 1403 of the new Civil Code, i. e., it is a contract or agreement for the sale of real
property or of an interest therein, it cannot also be contended that that provision does
not apply to the present case for the reason that there was part performance on the part
of one of the parties. In this connection, it must be noted that this statute is one based on
equity. It is based on equitable estoppel or estoppel by conduct. It operates only under
certain specified conditions and when adequate relief at law is unavailable (49 Am. Jur.,
Statute of Frauds, Section 422, p. 727). And one of the requisites that need be present is
that the agreement relied on must be certain, definite, clear, unambiguous and
unequivocal in its terms before the statute may operate. Thus, the rule on this matter is
as follows:jgc:chanrobles.com.ph
"The contract must be fully made and completed in every respect except for the writing
required by the statute, in order to be enforceable on the ground of part performance.
The parol agreement relied on must be certain, definite, clear, unambiguous, and
unequivocal in its terms, particularly where the agreement is between parent and child,
and be clearly established by the evidence. The requisite of clearness and definiteness
extends to both the terms and the subject matter of the contract. Also, the oral contract
must be fair, reasonable, and just in its provisions for equity to enforce it on the ground
of part performance. If it would be inequitable to enforce the oral agreement, or if its
specific enforcement would be harsh or oppressive upon the defendant, equity will
withhold its aid. Clearly, the doctrine of part performance taking an oral contract out of
the statute of frauds does not apply so as to support a suit for specific performance where
both the equities and the statute support the defendant’s case." (49 Am. Jur., p. 729.)
The alleged agreement is far from complying with the above requirement for, according
to the complaint, Santiago Babao bound himself to convert a big parcel of forest land of
156 hectares into a veritable farm planted to coconuts, rice, corn and other crops such as
bananas and bamboo trees and to act as administrator of said farm during the lifetime of
Celestina Perez, while the latter in turn bound herself to give either to Santiago or his wife
1/2, of the land as improved with all the improvements thereon upon her death. This
agreement is indeed vague and ambiguous for it does not specify how many hectares was
to be planted to coconuts, how many to rice and corn, and what portion to bananas and
bamboo trees. And as counsel for appellants puts it, "as the alleged contract stands, if
Santiago Babao should plant one-half hectares to coconuts, one-half to rice, and another
half hectare to corn, and the rest to bananas and bamboo trees, he would be entitled to
receive one-half of 156 hectares, or 78 hectares, of land for his services. That certainly
would be unfair and unheard of; no sane property owner would enter into such contract.
It costs much more time, money, and labor to plant coconut trees than to plant bananas
and bamboo trees; and it also costs less to convert forest land to rice and corn land than
to convert it into a coconut plantation. On the part of Celestina Perez, her promise is also
incapable of execution. How could she give and deliver one-half of the land upon her
death?"
The terms of the alleged contract would appear more vague if we consider the testimony
of Carlos Orense who claimed to have been present at the time the alleged agreement was
made between Celestina Perez and Santiago Babao for apparently the same does not run
along the same line as the one claimed by appellee. This is what Orense said: "You,
Santiago, leave the Llana estate and attend to this lupang parang. Have it cleared and
planted to coconuts, for that land will eventually fall in your hands" (as translated from
Tagalog), which runs counter with the claim of appellee. The agreement being vague and
ambiguous, the doctrine of part performance cannot therefore be invoked to take this
case out of the operation of the statue.
"Obviously, there can be no part performance until there is a definite and complete
agreement between the parties. In order to warrant the specific enforcement of a parol
contract for the sale of land, on the ground of part performance, all the essential terms of
the contract must be established by competent proof, and shown to be definite, certain,
clear, and unambiguous.
"And this clearness and definiteness must extend to both the terms and the subject-
matter of the contract.
"The rule that a court will not specifically enforce a contract for the sale of land unless its
terms have been definitely understood and agreed upon by the parties, and established
by the evidence, is especially applicable to oral contracts sought to be enforce on the
ground of part performance. An oral contract, to be enforced on this ground, must at least
have that degree of certainty which is required of written contracts sought to be
specifically enforced.
"The parol contract must be sufficiently clear and definite to render the precise acts which
are to be performed thereunder clearly ascertainable. Its terms must be so clear and
complete as to allow no reasonable doubt respecting its enforcement according to the
understanding of the parties." (101 A. L. R., pp. 950-951)
"In this jurisdiction, as in the United States, the existence of an oral agreement or
understanding such as that alleged in the complaint in the case at bar cannot be
maintained on vague, uncertain, and indefinite testimony, against the reasonable
presumption that prudent men who enter into such contracts will execute them in
writing, and comply with the formalities prescribed by law for the creation of a valid
mortgage. But where the evidence as to the existence of such an understanding or
agreement is clear, convincing, and satisfactory, the same broad principles of equity
operate in this jurisdiction as in the United States to compel the parties to live up to the
terms of their contract." (Cuyugan v. Santos, 34 Phil., 100, 101.)
There is another flaw that we find in the decision of the court a quo. During the trial of
this case, counsel for appellants objected the admission of the testimony of plaintiff
Bernardo Babao and that of his mother Cleofe Perez as to what occurred between
Celestina Perez and Santiago Babao with regard to the agreement on the ground that their
testimony was prohibited by section 26 (c) of Rule 123 of the Rules of Court. This rule
prohibits parties or assignors of parties to a case, or persons in whose behalf a case is
prosecuted, against an executor or administrator 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 the trial court overruled the
opposition saying that said rule did not apply where the complaint against the estate of a
deceased person alleges fraud, citing the case of Ong Chua v. Carr, 53 Phil., 980. Here again
the court is in error because if in that case the witness was allowed to testify it was
because the existence of fraud was first established by sufficient and competent evidence.
Here, however, the alleged fraud is predicated upon the existence of the agreement itself
which violates the rule of petitio principii. Evidently, the fraud to exist must be
established by evidence aliunde and not by the same evidence which is to sought to be
prevented. The infringement of the rule is evident.
". . . The reason for this rule is that ‘if death has closed the lips of one party, the policy of
the law is to close the lips of the other.’ Another reason is that ‘the temptation to falsehood
and concealment in such cases is considered too great to allow the surviving party to
testify in his own behalf.’ Accordingly, the incompetency applies whether the deceased
died before or after the commencement of the action against him, if at the time the
testimony was given he was dead and cannot disprove it, since the reason for the
prohibition, which is to discourage perjury, exists in both instances." (Moran, Comments
on the Rules of Court, Vol. 3, 1952 Ed., p. 234.)
Having reached the conclusion that all the parol evidence of appellee was submitted in
violation of the Statute of Frauds, or of the rule which prohibits testimony against
deceased persons, we find unnecessary to discuss the other issues raised in appellants’
brief.

Wherefore, the decision appealed from is reversed, and the case is dismissed, with costs
against appellee.
LICHAUCO VS ATLANTIC
ONG CHUAVS CARR
1. WITNESSES; ADMISSIBILITY OF TESTIMONY AGAINST A DECEASED PERSON. —
Subsection 7 of section 383 of the Code of Civil Procedure bars the plaintiff, upon a claim or
demand against the estate of a deceased person, from testifying as to any matter of fact
occurring before the death of such deceased person, but the statute is not designed to shield
wrongdoers and to render a plaintiff incompetent to testify to fraudulent transactions of the
deceased if the fraud has been clearly established by other evidence.
This is an appeal by the defendants from a decision of the Court of First Instance of
Zamboanga ordering the reformation of the deed of sale executed by the plaintiff in favor
of Edward Carr for lots Nos. 135, 136, and 137 of cadastral case No. 8695, West Extension,
and for a house of strong materials constructed on another parcel of land, lot No. 132 of
the same case. A copy of the deed is attached to the record and is marked Exhibit A.
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 the plaintiff, Ong
Chua, and on June 17, 1923, the latter executed a public document granting to Magdalena
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 Henry E. 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.
In the month of July, 1925, Edward Carr came to Zamboanga, bringing with him letters of
introduction addressed to P. J. Moore, a practicing attorney in that town. With said letters
Carr 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 Henry E. Teck and Magdalena 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.
On December 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, December 14, 1925
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.
More thereupon instructed his clerk, C. E. Darlucio, 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 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.
In September, 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.
In 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. On July 23, 1926, this action was
brought, the plaintiff alleging in substance the principal facts hereinbefore stated and
demanding that the deed in question be reformed in accordance therewith. The
defendant demurred, but the demurrer was overruled. The defendant 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 Henry E.
Teck and Magdalena 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 the court below ordered
the reformation of the deed, Exhibit A, in accordance with the plaintiff’s demand.
On appeal to this court the defendant-appellant presents six assignments of error, which
may conveniently be reduced to two propositions, namely (1) that the court erred in
permitting the plaintiff, Ong Chua, to testify, over the defendant’s objections, to facts
occurring prior to the death of the defendant Carr, and (2) that the facts proven do not
justify the reformation of the deed in question.
The first proposition rests on subsection 7 of section 383 of the Code of Civil Procedure,
which 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.
Similar provisions are to be found in the statutes of practically all of the states of the
Union, and the rule thus laid down is now unquestioned. 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. As stated in Jones on Evidence, 2d ed., sec. 774:jgc:chanrobles.com.ph
"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."cralaw virtua1aw
library
And in the case of Tongco v. Vianzon (50 Phil., 698, 702) this court
said:jgc:chanrobles.com.ph
"Counsel is eminently correct in emphasizing that 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. He has, however, neglected the equally
important rule that the law was designed to aid in arriving at the truth and was not
designed to suppress the truth."cralaw virtua1aw library
In this case a number of credible witnesses testified to facts which conclusively showed
that Carr’s conduct was tainted with fraud. The 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.
In regard to the second proposition above-mentioned, counsel for the appellant
says:jgc:chanrobles.com.ph
"It is our belief which is supported by the very exhibits themselves that at this conference
the parties decided to enter into two separate agreements. One in writing — Exhibit A —
being an absolute conveyance of the property from Ong Chua to Edward Carr; the other a
verbal agreement by which all the documents, titles, etc. were left with P. J. Moore in
escrow until the time fixed in Exhibits B and C had lapsed. There was no mistake on the
part of anyone in executing Exhibit A for while there has been a great deal of talk about
the insertion of a clause no one has yet said what was to be said in that clause or condition.
Again, Exhibit A not only said nothing about any right to redemption but contains a full
warranty of title . . ."cralaw virtua1aw library
It will be noted that counsel admits that the deed was left in escrow with Moore, and if it
were true that there was no mistake on the part of the plaintiff at the time of the execution
of the deed, a suit for reformation would hardly be appropriate. But that would not
improve the appellant’s position. 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
(Devlin on Real Estate, 3d ed., par. 312-A and authorities there cited). It is also well
established that an escrow delivered without authority or obtained fraudulently passes
no title (Smith v. South Royalton Bank, 32 Vt., 341; 76 Am. Dec., 179). 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). So much for the appellant’s theory.
We think, however, that 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. He had confidence in Moore, with whom he had
had previous business relations, and it was but natural for him to believe Moore’s
statement.
Carr, on the other hand, knew the contents of the deed and fully agreed to Moore’s plan
to place it in escrow 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.
Reformation will be given "where there is a mistake on one side and fraud or unfair
dealing on the other" (Devlin on Real Estate, 3d ed., par. 1238). That is this case, and it
follows that the suit for reformation may be maintained.
Certain minor points raised by appellant’s counsel are so obviously without merit as to
require no discussion; the sale of the property by the plaintiff to the defendant was
subject to Teck’s and Lim’s rights of redemption, and it was perfectly proper for the court
below, in its judgment, to define the extent of these rights. Neither was it error on the part
of the court to hold that the pendency of the action tolled the term for the right of
redemption; that is an old and well established rule.
The appealed judgment is affirmed with the costs against the appellant. So ordered.
Johnson, Street, Malcolm, Villamor, Johns, Romualdez, and Villa-Real, JJ., concur.
GONI VS CA
REMEDIAL LAW; EVIDENCE; DISQUALIFICATION OF WITNESSES BY REASON OF
INTEREST OR RELATIONSHIP; RATIONALE. — The object and purpose of Rule 130, Sec. 20
par. (a) 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.
2. ID.; ID.; ID.; APPLICABLE IN THE CASE AT BAR. — The case at bar, although instituted
against the heirs of Praxedes Villanueva after the estate of the latter had been distributed
to them, remains within the ambit of the protection. The reason is that 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 deceased might have been interested to establish, if living.
3. ID.; ID.; EXCEPTION; WAIVER, HOW MADE; CASE AT BAR. — The protection under the
Rules, was effectively waived when counsel for petitioners cross-examined private
respondent Vicente. "A waiver occurs when plaintiff’s deposition is taken by the
representatives of the estate or when counsel for the representative cross-examined the
plaintiff as to matters occurring during deceased’s lifetime." It must further be observed that
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.
13 and 14. 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 of representatives of the estate/deceased
person.
4. ID.; ID.; ID.; ID.; LIMITATIONS. — Under the great majority of statutes, 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.
5. ID.; ID.; ID.; INEQUALITY SOUGHT TO BE AVOIDED BY THE RULES, INEXISTENT. — 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 Goni could and did not negate the binding effect of the
contract/promise to sell. Thus, while admitting the existence of the said contract/promise
to sell, petitioner Goni testified that the same was subsequently novated into a verbal
contract of lease over fields nos. 4 and 13 of the Hacienda Dulce Nombre de Maria.
This is an appeal by certiorari from the decision of the then Court of Appeals in CA-G.R.
No. 27800-R entitled, "Gaspar Vicente, Plaintiff-Appellant, v. Genaro Goñi, et. al.,
Defendants-Appellants" as well as from the resolution denying petitioners’ motion for
reconsideration.
The factual backdrop is as follows:chanrob1es virtual 1aw library
The three (3) haciendas known as San Sebastian, Sarria and Dulce Nombre de Maria
situated in the Municipality of Bais, Negros Oriental, were originally owned by the
Compañia General de Tabacos de Filipinas [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.
Allegedly because TABACALERA did not agree to the transaction between Villanueva and
Villegas, without a guaranty private respondent Gaspar Vicente stood as guarantor for
Villegas in favor of TABACALERA. The guarantee was embodied in a document
denominated as "Escritura de Traspaso de Cuenta." 1
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 private respondent Vicente, Villanueva contracted or promised
to sell to the latter 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 petitioner Genaro
Goñi as attorney-in-fact of Villanueva, thus:chanrobles.com.ph : virtual law library
"En consideracion a la garantia que Don Gaspar Vicente asume con la Cia. Gral. de Tabacos
de Filipinas por el saldo de Don Santiago Villegas de P43,539.75 asumido por Don Joaquin
Villegas el que Suscribe Praxedes T. Villanueva se compromete ceder es venta a Don
Gaspar Vicente los campos nos. 3, 4 y 13 del plano de porcelario de la Hacienda Dulce
Nombre de Maria, en compra projectada de la Cia. Gral. de Tabacos de Filipinas. Estas
campos representan 6-90-35 hectares por valor de P13,807.00 que Don Gasper Vicente
pagara directamente a Praxedes T. Villanueva.
"Bais, Central, Octubre 24, 1949.
"Fdo. Praxedes T. Villanueva.
Por: "Fdo. Genaro Goñi
Apoderado" 2
Private respondent 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 private respondent’s account. The difference was
supposedly paid by private respondent to Villanueva, but as no receipt evidencing such
payment was presented in court, this fact was disputed by petitioners.
It is alleged by petitioners that subsequent to the execution of the contract/promise to
sell, Villanueva was able to raise funds by selling a property in Ayungon, Negros Oriental.
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 (5) years starting with crop-year 1950-51 at an annual rental of 15% of the gross
income, said rent to be deducted from the money advanced by private respondent and
any balance owing to Villanueva would be delivered by Vicente together with the lots at
the end of the stipulated period of lease.chanrobles virtual lawlibrary
On 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 under TCT No. T-4780 of the
Register of Deeds of Negros Oriental. The fields were likewise mortgaged by Villanueva
to the Rehabilitation Finance Corporation (RFC), later transferred to the Philippine
National Bank on December 16, 1955, for a total indebtedness of P334,400.00. 3
Meanwhile, Fields nos. 4 and 13 were delivered to private respondent Vicente after the
1949-1950 milling season in January and February, 1950.
 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.
On June 17, 1950, Villanueva executed a "Documento de la Venta Definitiva" in favor of
Joaquin Villegas, covering Lot No. 314 of the Cadastral Survey of Bais with an area of
468,627 square meters, more or less, (Hacienda Sarria). A supplemental instrument was
On July 13, 1957, the parties entered into a stipulation of facts, agreeing, among others,
later executed by Villanueva in favor of Villegas to include in the sale of June 17, 1950 the
on the costs of production and produce of the three fields in question. The case thereafter
sugar quota of the land.
proceeded to trial. Plaintiff presented two (2) witnesses: then party-plaintiff Gaspar
Vicente, himself, who over the objection of therein defendants testified on facts occurring
before the death of Praxedes Villanueva, and Epifanio Equio, a clerk of TABACALERA
On November 12, 1951, Villanueva died. Intestate proceedings were instituted on
Agency in the Bais Sugar Central. Defendants presented Genaro Goñi, who testified on the
November 24, 1951 before the then Court of First Instance of Negros Oriental, docketed
alleged verbal lease agreement.
as Special Case No. 777. Among the properties included in the inventory submitted to the
court were fields nos. 3, 4 and 13 of Hacienda Dulce Nombre de Maria. Field no. 13 with
an area of 1 hectare, 44 ares and 95 centares was listed as Lot no. 723 of the inventory,
On December 18, 1959, the trial court rendered a decision ordering therein defendants-
while fields nos. 3 and 4, with areas of 3 hectares, 75 ares and 60 centares, and 1 hectare,
heirs to deliver to Gaspar Vicente field no 3, to execute a formal deed of sale covering
69 ares and 80 centares, respectively, were included in Lot no. 257 of the inventory.
fields nos. 3, 4 and 13 in favor of Vicente, to pay the latter actual or compensatory
damages in the amount of P81,204.48, representing 15% of the total gross income of field
no. 3 for crop-years 1950-51 to 1958-59, and such other amounts as may be due from
On October 7, 1954, the day before the intestate proceedings were ordered closed and
said field for the crop years subsequent to crop-year 1958-59, until the field is delivered
the estate of the late Praxedes Villanueva delivered to his heirs, private respondent
to Vicente, and to pay the sum of P2,000.00 as attorney’s fees plus costs. Therein
Vicente instituted an action for recovery of property and damages before the then Court
defendant Goñi was relieved of any civil liability for damages, either personally or as
of First Instance of Negros Oriental against petitioner Goñi in his capacity as
administrator of the estate. 5
administrator of the intestate estate of Praxedes Villanueva. In his complaint docketed as
Civil Case No. 2990, private respondent Vicente sought to recover field no. 3 of the
Hacienda Dulce Nombre de Maria, basing his entitlement thereto on the
Both parties appealed the decision to the then Court of Appeals; the plaintiff from the
contract/promise to sell executed by the late Praxedes Villanueva in his favor on October
portion awarding damages on a claim that he was entitled to more, and defendants, from
24, 1949. He likewise prayed by way of attorney’s fees and other costs the sum of
the entire decision.chanrobles virtual lawlibrary
P2,000.00 and for such other further relief which the court may deem just and equitable
in the premises. 4

On December 15, 1966, the Court of Appeals promulgated its decision, affirming that of
the lower court, with the modification that the amount of damages to be paid by
On October 25, 1954, petitioner Goñi, as defendant in Civil Case No. 2990, filed an answer
defendant-heirs to the plaintiff should be the total net income from field no. 3 from the
with counterclaim for accounting of the produce of fields nos. 4 and 13, as well as the
crop year 1950-51 until said field is finally delivered to the plaintiff plus interest thereon
surrender thereof on June 20, 1955, the end of the fifth crop-year, plus moral damages in
at the legal rate per annum. 6
the sum of P30,000.00 and P3,000.00 as attorney’s fees. After an answer to the counter-
claim 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
Petitioners filed a motion for reconsideration, but were denied the relief sought in a
resolution dated February 9, 1967. Hence, the present appeal by certiorari whereby
"(a) Parties or assignors of parties to a case, or persons in whose behalf a case is
petitioners raise the following questions of law:jgc:chanrobles.com.ph
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
"MAY RESPONDENT GASPAR VICENTE TESTIFY ON MATTERS OF FACT OCCURRING
matter of fact occurring before the death of such deceased person or before such person
BEFORE THE DEATH OF PRAXEDES T. VILLANUEVA, WHICH CONSTITUTES A CLAIM OR
became of unsound mind."cralaw virtua1aw library
DEMAND UPON HIS ESTATE, IN VIOLATION OF RULE 123, SEC. 26, PAR. (C), NOW RULE
130, SEC. 20 PAR. (A)?
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
"MAY NOT A WRITTEN PROMISE TO SELL DATED OCTOBER 24, 1949 BE NOVATED INTO
further to put the two parties to a suit upon terms of equality in regard to the opportunity
A VERBAL AGREEMENT OF LEASE DURING THE LIFETIME OF THE PROMISSOR, WHOSE
of giving testimony. 9 It is designed to close the lips of the party plaintiff when death has
DEATH OCCURRED ON NOVEMBER 12, 1951, BY FACTS AND CIRCUMSTANCES
closed the lips of the party defendant, in order to remove from the surviving party the
SUBSTANTIATED BY COMPETENT ORAL EVIDENCE IN THIS CASE?
temptation to falsehood and the possibility of fictitious claims against the deceased. 10

"SHOULD THE PROMISEE IN A PROMISE TO SELL, WHO PAID P12,460.24 WHICH WAS
The case at bar, although instituted against the heirs of Praxedes Villanueva after the
TO BE ACCOUNTED AND TO BE CREDITED AS RENTALS AFTER FIVE (5) YEARS OF
estate of the latter had been distributed to them, remains within the ambit of the
LEASE, WHO IN HIS ORIGINAL COMPLAINT DID NOT ALLEGE NOR PROVE DAMAGES,
protection, The reason is that the defendants-heirs are properly the "representatives" of
EXCEPT THE SUM OF P2,000.00 AS ATTORNEY’S FEES, RECEIVE A JUDGMENT FOR
the deceased, not only because they succeeded to the decedent’s right by descent or
DAMAGES IN THE AMOUNT OF P74,056.35 WHICH CONSISTS OF P37,121.26 PLUS
operation of law, but more importantly because they are so placed in litigation that they
LEGAL INTEREST FOR THE CROP YEARS 1950-51 TO 1958-59 AND FOR P3,624.18 TO
are called on to defend which they have obtained from the deceased and make the defense
P4,374.78 FOR EVERY CROP YEAR SUBSEQUENT TO 1958-59 PLUS INTEREST?" 7
which the deceased might have made if living, or to establish a claim which deceased
might have been interested to establish, if living. 11

We find that neither the trial nor appellate court erred in ruling for the admissibility in
evidence of private respondent Vicente’s testimony. Under ordinary circumstances,
Such protection, however, was effectively waived when counsel for petitioners cross-
private respondent Vicente 8 would be disqualified by reason of interest from testifying
examined private respondent Vicente. "A waiver occurs when plaintiff’s deposition is
as to any matter of fact occurring before the death of Praxedes T. Villanueva, such
taken by the representative of the estate or when counsel for the representative cross-
disqualification being anchored on Section 20(a) of Rule 130, commonly known as the
examined the plaintiff as to matters occurring during deceased’s lifetime." 12 It must
Survivorship Disqualification Rule or Dead Man Statute, which provides as
further be observed that petitioners presented a counterclaim against private respondent
follows:jgc:chanrobles.com.ph
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
"Section 20. Disqualification by reason of interest or relationship. — The following not disqualified from testifying as to matters of fact occurring before the death of
persons cannot testify as to matters in which they are interested, directly or indirectly, as
herein enumerated:jgc:chanrobles.com.ph
Praxedes Villanueva, said action not having been brought against, but by the estate or
representatives of the estate/deceased person.chanrobles.com.ph : virtual law library
Likewise, under a great majority of statutes, 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. 13 The contract/promise to sell under
consideration was signed by petitioner Goñi as attorney-in-fact (apoderado) of Praxedes
Villanueva. He was privy to the circumstances surrounding the execution of such contract
and therefore could either confirm or deny any allegations made by private respondent
Vicente with respect to said contract. 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 Goñi
could and did not negate the binding effect of the contract/promise to sell. Thus, while
admitting the existence of the said contract/promise to sell, petitioner Goñi testified that
the same was subsequently novated into a verbal contract of lease over fields nos. 4 and
13 of the Hacienda Dulce Nombre de Maria.
Novation takes place when the object or principal condition of an obligation is changed
or altered. 14 In order, however, that an obligation may be extinguished by another which
substitutes the same, it is imperative that it be so declared in unequivocal terms, or that
the old and the new obligations be on every point incompatible with each other. 15
"Novation is never presumed. It must be established that the old and the new contracts
are incompatible in all points, or that the will to novate appear by express agreement of
the parties or in acts of equivalent import." 16
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 Goñi, 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.
If it were true that he made demands on Villanueva for the surrender of field no. 3 as well
as the execution of the corresponding deed of sale, he should have, upon refusal of the
latter to do so, immediately or within a reasonable time thereafter, instituted an action
for recovery, or as previously observed, caused his adverse claim to be annotated on the
certificate of title. Considering that field no. 3, containing an area of three (3) hectares, 75
ares and 60 centares, is the biggest among the three lots, an ordinary prudent man would
have taken these steps if he honestly believed he had any right thereto. Yet, private
respondent Vicente did neither, In fact such inaction persisted even during the pendency
of the intestate proceedings wherein he could have readily intervened to seek exclusion
of fields nos. 3, 4 and 13 from the inventory of properties of the late Praxedes Villanueva.
The reason given by private respondent Vicente that field no. 3 was not delivered to him
together with fields nos. 4 and 13 because there were small sugar cane growing on said
field at that time belonging to TABACALERA, might be taken as a plausible explanation
why he could not take immediate possession of lot no. 3, but it certainly could not explain
why it took him four years before instituting an action in court, and very conveniently, as
petitioners noted, after Villanueva had died and at the time when the verbal contract of
lease was about to expire.
Both the trial and appellate courts chose to believe in the contract/promise to sell rather
than the lease agreement, simply because the former had been reduced to writing, while
the latter was merely verbal. It must be observed, though, that the contract/promise to
sell was signed by petitioner Goñi as attorney-in-fact of the late Praxedes Villanueva, an
indication, to our mind, that final arrangements were made by petitioner Goñi in the
absence of Villanueva. It was therefore natural for private respondent Vicente to have
demanded that the agreement be in writing to erase any doubt of its binding effect upon
Villanueva. On the other hand, the verbal lease agreement was negotiated by and between
Villanueva and private respondent Vicente themselves. Being close friends and relatives
17 it can be safely assumed that they did not find it necessary to reduce the same into
writing.chanrobles.com.ph : virtual law library
In rejecting petitioners’ contention respecting the verbal lease agreement, the appellate
court put much weight on the failure of petitioners to demand an accounting of the
produce of fields nos. 4 and 13 from 1950 to 1954, when the action for recovery of
property was filed. Such failure was satisfactorily explained by petitioners in their motion
for reconsideration filed before the then Court of Appeals, in this
manner:jgc:chanrobles.com.ph
". . . Mr. Genaro Goñi is also a farmer by profession and that there was no need for him to
demand a yearly accounting of the total production because the verbal lease agreement
was for a term of 5 years. The defendant Mr. Genaro Goñi as a sugar planter has already
full knowledge as to the annual income of said lots nos. 4 and 13, and since there was the
amount of P12,460.25 to be liquidated, said defendant never deemed it wise to demand
such a yearly accounting. It was only after or before the expiration of the 5 year lease that
said defendant demanded the accounting from the herein plaintiff regarding the
production of the 2 lots that were then leased to him.
"It is the custom among the sugar planters in this locality that the Lessee usually demands
an advance amount to cover the rental for the period of the lease, and the demand of an
accounting will be only made after the expiration of the lease period. It was adduced
during the trial that the amount of P12,460.75 was considered as an advance rental of the
2 lots which was leased to the Plaintiff, lots nos. 4 and 13, so we humbly believe that there
was no necessity on the part of defendant Mr. Genaro Griño to make a yearly demand for
an accounting for the total production of 2 parcels leased to the plaintiff." 18
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. Discussion of the third issue raised therefore
becomes unnecessary.
WHEREFORE, the decision appealed from is hereby reversed. The judicial administrator
of the estate of private respondent Gaspar Vicente and or his successors-in-interest are
hereby ordered to: a) surrender possession of fields nos. 4 and 13 of the Hacienda Dulce
Nombre de Maria to petitioners; b) render an accounting of the produce of said fields for
the period beginning crop-year 1950-51 until complete possession thereof shall have
been delivered to petitioners; and c) to pay the corresponding annual rent for the said
fields in an amount equivalent to 15% of the gross produce of said fields, for the periods
beginning crop-year 1950-51 until said fields shall have been surrendered to petitioners,
deducting from the amount due petitioners the sum of P12,460.24 advanced by private
respondent Gaspar Vicente.
SO ORDERED.
MENDEZONA VS VAD. DE GOITIA
The plaintiffs, Leonor Mendezona and Valentina Izaguirre y Nazabal, filed separate claims
with the committee of claims and appraisal against the intestate estate of Benigno Goitia
y Lazaga (Court of First Instance of Manila, civil case No. 30273), the first for the amount
of P5,940, and the second, P2,376. By order of the court dated June 16, 1927, these claims
were heard by the committee. The claimants presented their evidence, which the
committee deemed insufficient and disapproved their claims. Both claimants appealed
from the report of the committee, and in accordance with section 776 of the Code of Civil
Procedure, filed a new complaint which was later amended with the approval of the court,
there being nothing in the bill of exceptions to show that the defendant, or the
administratrix of the deceased Benigno Goitia, excepted to the court's order admitting the
amendments to the complaints.chanroblesvirtualawlibrary chanrobles virtual law
library
The defendant answered the amended complaints, pleading in special defense, that not
having no knowledge of the supposed management of their rights in the "Tren de
Aguadas," and , furthermore, not having seen nor received any money of the plaintiff's
from said business, she is not in a position to render an account of any sort to the
plaintiffs, either in her own personal capacity or as judicial administratrix of Benigno
Goitia's intestate estate.chanroblesvirtualawlibrary chanrobles virtual law library
By agreement of the parties, both cases were tried together, and the trial court rendered
but one decision upon them on October 31, 1928, holding it sufficiently proved, "that
defendant Encarnacion C. Vda, de Goitia has been duly appointed judicial administratrix
of the estate of her deceased husband Benigno Goitia in special proceeding No. 30273 of
this court; that Benigno Goitia was the representative and attorney-in-fact of the plaintiffs
in the joint-account partnership known as the "Tren de Aguadas" and located in the City
of Manila, 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; that prior to 1915, Benigno Goitia, at that time the manager of the aforesaid
co-partnership, collected the dividends for the plaintiffs, which he remitted to them every
year; that prior to 1915, the usual dividends which Benigno Goitia forwarded to plaintiff
Leonor Mendezona each year were P540, and to plaintiff Valentina Izaguirre y Nazabal,
P216; that from 1915 until his death in August, 1926, Benigno Goitia failed to remit to the
dividends upon their shares in the "Tren de Aguadas"; that 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; that from 1915 to 1926, the "Tren de Aguadas" paid dividends to the share-holders,
one of them, Ramon Salinas, having received the total amount of P1,155 as ordinary and
special dividends upon his 15 shares' that calculating the dividends due from 1915 to
1926 upon Leonor Mendezona's 180 shares at P540 per annum, and at P216 yearly upon
the 72 shares held by Valentina Izaguirre y Nazabal, 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." chanrobles virtual law library
The trial court likewise deemed it proven that "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 attorney-
in-fact for both of them, which he has neither remitted nor accounted for to the said
plaintiffs, although it has been prove that said Benigno Goitia was their attorney-in-fact
and representative in the "Tren de Aguadas" up to the time of his death." chanrobles
virtual law library
The court below therefore 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, in special proceeding No. 30273 of this court (below), to render an account of the
amounts collected by her aforesaid husband Benigno Goitia, as attorney-in-fact and
representative of the plaintiffs Leonor Mendezona and Valentina Izaguirre y Nazabal in
the copartnership known as the "Tren de Aguadas" from 1915 to July, 1926, within thirty
days from notice of this decision; and that the defendant may see, examine, and make a
copy of the books and documents relative to the business of the aforementioned
copartnership, in accordance with the provisions of section 664 of the Code of Civil
Procedure. Without special pronouncement of costs.chanroblesvirtualawlibrary
chanrobles virtual law library
On December 15, 1928, at the instance of the plaintiffs, the trial court set the 15th of
January, 1929, as the date on which the defendant should present her account of the
dividends and profits collected by the decedent, as attorney-in-fact for the plaintiffs, with
regard to the "Tren de Aguatas" copartnership, form 1915 to 1926, and the hearing was
postponed to the 7th of February, 1929.chanroblesvirtualawlibrary chanrobles virtual
law library
On February 6, 1929, the 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 "Tren de Aguadas," 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, Benigno de Goitia, than a book of
accounts where she came upon an item of P90 for Leonor Mendezona, and another of P36
for Valentina Izaguirre.chanroblesvirtualawlibrary chanrobles virtual law library
In view of this report and the evidence taken at the hearing the court rendered a
suppletory judgment, upon motion of the plaintiffs dated December 3, 1928; and taking
into account chiefly the testimony of Ruperto Santos and Ramon Salinas, it was held that,
upon the basis of the dividends received by the witness Salinas on his fifteen shares in the
"Tren de Aguadas" from 1915 to 1925, it appears that the dividends distributed for each
share was equal to one-fifteenth of P1,087.50, that is P72.50. Thus the dividends upon
plaintiff Leonor Mendezona's 180 shares would be P13,050, and upon the 72 shares
pertaining to Valentina Izaguirre, P5,220; and these sums, added to those collected by the
attorney-in-fact Benigno Goitia as part of the 1926 dividends, P90 for Leonor Mendezona,
and P36 for Valentina Izaguirre, show that Benigno Goitia thereby received P13,140 in
behalf of Leonor Mendezona, and P5,256 in behalf of Valentina
Izaguirre.chanroblesvirtualawlibrary chanrobles virtual law library
Wherefore, 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.chanroblesvirtualawlibrary chanrobles
virtual law library
The defendant duly appealed from this judgment to this Supreme Court through the
proper bill of exceptions.chanroblesvirtualawlibrary chanrobles virtual law library
The fundamental question raised by the appellant in the first assignment of error refers
to the court's jurisdiction to admit the amended complaints whereby the plaintiffs claim
P13,680 and P5,470 respectively, whereas the claims presented to the committee of
claims and appraisal were only for P5,940 and P2,376, respectively. Appellant contends
that the plaintiffs have not perfected their appeal in accoundance with section 773 of the
Code of Civil Procedure in claiming more in their complaints than in the claims filed with
the committee of claims and appraisal, by including therein, not only the yearly dividends
paid from 1915 to 1925, inclusive, but also the ordinary and extraordinary dividends
upon their shares for the years of 1915 to 1926, alleged to have been delivered to Benigno
Goitia.chanroblesvirtualawlibrary chanrobles virtual law library
The fact that the claims filed with the committee were upon the basis of annual dividends,
while those filed with the court below were on ordinary and extraordinary dividends, is
of no importance, for, after all they refer to the same amounts received by the deceased
Benigno Goitia in the name and for the benefit of the plaintiffs. The question to be decided
is whether or not in this jurisdiction a greater sum may be claimed before the court than
was claimed before the committee. It should be noted that according to the cases cited by
the appellant on pages 12 and 13 of her brief, to wit, Patrick vs. Howard, 47 Mich., 40; 10
N. W. 71. 72; Dayton vs. Dakin's Estate, 61 N. W., 349; and Luizzi vs. Brandy's Estate, 113
N. W., 574; 140 Mich., 73; 12 Detroit Leg., 59, the claims passed upon by the committee
cannot be enlarged in the Circuit Court by amendment. But counsel for the appellees
draws our attention to the doctrines of the Vermont Supreme Court (Maughan vs. Burns'
Estate, 64 Vt., 316; 23 Atlantic, 583), permitting an augmentative amendment to the claim
filed with the committee.chanroblesvirtualawlibrary chanrobles virtual law library
In the Maughan case, supra, the court stated:
ROWELL, J. This is an appeal from the decision and report of the commissioners on the
estate of Michael Burns. Plaintiff presented her claim to the commissioners at $2,789.65.
The ad damnum in her declaration filed in the probate court was $3,500. In the country
court she recovered $3,813.49. Thereupon she moved for leave to amend her declaration
by raising the ad damnum to $4,000, which was granted, and she had judgment for the
amount of her recovery. The identical claim presented to the commissioners was the
claim tried above. The amount of plaintiff's recovery rested on the quantum meruit. The
jury found that she merited more than she estimated her claim when she presented it to
the commissioners. But such underestimate did not preclude her from recovering more,
if the testimony show her entitled to it, as presumably it did, as more was found. The fact
of such estimate was evidence against here deserving more, as it was an implied
admission that what she claimed was enough; but the admission was not conclusive upon
her, and did not prevent 527; Stowe vs. Bishop, 58 Vt., 498; 3 Atl. Rep., 494; Hard vs.
Burton, 62 Vt., 314; 20 Atl. Rep., 269.)chanrobles virtual law library
It is conceded that in common-low actions the court has power to raise the ad damnum
at any time; but it is claimed that as the probate court is not a common-low court, but is
a court of special and limited jurisdiction, and has by statue original jurisdiction of
settlement of the estates of deceased person, the country court has no power to raise the
ad damnum of the declaration filed in the probate court. The county court has, by statue,
appellate jurisdiction of matters originally within the jurisdiction of the probate court
and in such appeals it sits as a higher court of probate, and its jurisdiction is co-extensive
with that of the probate court. It is not limited to the particular questions that arose in
the probate court in the matter appealed, but is expressly extended to matters originally
within the jurisdiction of that court. It is an appellate court for the rehearing and the re-
examination of matters - not particular questions merely - that have been acted upon in
the court below. (Adams vs. Adams, 21 Vt., 162) And these matters embrace even those
that rest in discretion. (Holmes vs. Holmes, 26 Vt., 536.) In Francis vs. Lathrope, 2 Tyler,
372, the claimant was allowed, on terms, to file a declaration in the country court, he
having omitted to file one in the probate court as required by statute. It was within the
jurisdiction of the probate court to have allowed this amendment, and, as the county court
had all the jurisdiction of the probate court in this behalf, it also had power to allow the
amendment.
However this may be, in this jurisdiction there is a rule governing the question raised in
this assignment of error, namely, section 776 of the Code of Civil Procedure, as construed
in the cases of Zaragoza vs. Estate of De Viademonte (10 Phil., 23); Escuin vs. Escuin (11
Phil., 332); and In re Estate of Santos (18 Phil., 403). This section provides:
SEC. 776. Upon the lodging of such appeal; with the clerk, the disputed claim shall stand
for trial in the same manner as any other action in the Court of First Instance, the creditor
being deemed to be the plaintiff, and the estate the defendant, and pleading as in other
actions shall be filed.
Just as in ordinary actions in which the pleadings may be amended, so in the instant case,
the original complaint for the same amounts claimed before the committee was altered,
increasing the amounts, and the amended complaint was approved by the court and not
objected to by the adverse party. The character of the action throughout is the same. The
action before the committee rested on the contention that as attorney-in-fact for the
plaintiffs with respect to the partnership "Tren de Aguadas," the late Benigno Goitia had
received dividends upon their shares which he failed to turn over to them; the appeal to
the Court of First Instance is founded on the same contention. When the claim was filed
with the committee, counsel for the plaintiffs merely made a calculation of the amounts
due, in view of the fact that he had not all the data from the plaintiffs, who live in Spain;
but after filing the complaint on appeal with the court of First Instance, he discovered that
his clients were entitled to larger sums, and was therefore compelled to change the
amount of the claims.chanroblesvirtualawlibrary chanrobles virtual law library
Considering the distance that separated the plaintiffs from their attorney-in-fact, the
deceased Benigno Goitia, and that the latter failed to supply them with data from 1915
until his death in 1926, it is natural that they had to resort to calculating the amounts due
them from the "Tren de Aguadas." To deny them the right to amend their complaint in
accordance with section 776, when they had secured more definite information as to the
amounts due them, would be an injustice, especially when it is taken into consideration
that this action arises from trust relations between the plaintiffs and the late Benigno
Goitia as their attorney-in-fact.chanroblesvirtualawlibrary chanrobles virtual law library
The first error is therefore overruled.chanroblesvirtualawlibrary chanrobles virtual law
library
The allegation found in the second assignment of error that the plaintiffs are not in reality
interested parties in this case is untenable. It does not appear from the bill of exceptions
that the appellant demurred on the ground of misjoinder of parties, or alleged such
misjoinder in her answer. In accordance with section 93 of the Code of Civil Procedure,
the appellant has waived the right to raise any objection on the ground that the plaintiffs
are not the real parties in interest, or that they are not the owners of the stock in question.
(Broce vs. Broce, 4 Phil., 611; and Ortiz vs. Aramburo, 8 Phil., 98) Furthermore it appears
from Exhibits D, E, F, and G, that the late Benigno Goitia recognized that those shares of
the "Tren de Aguadas" really belonged to the plaintiffs. And above all, Exhibit K-1, which
is a copy of the balance sheet for May and June, 1926, taken from the books of the
partnership, clearly shows that Leonor Mendezona owned 180 shares, and Valentina
Izaguirre, 72 shares. Therefore the appellant cannot now contend that the plaintiffs are
not the real interested parties.chanroblesvirtualawlibrary chanrobles virtual law library
In the third assignment of error it is argued that following section 676 of the Code of Civil
Procedure, the court below had no power to order the defendant to render an account of
dividends supposed to have been received by her deceased husband. We are of opinion
that the order of the court enjoining the appellant to render an account of all the amounts
collected by her aforesaid husband Benigno Goitia as representative and attorney-in-fact
of the plaintiffs, from 1915 until June, 1926, was made for the purpose of giving her an
opportunity of showing, if she could, just what amounts the deceased Goitia received on
account of the appellees' stock. There is no reversible error in this; for, as the complaint
demanded the return of amounts alleged to have been received by the deceased attorney-
in-fact represented by the appellant, it was quite in order to determine whether such
amounts were really received or not.chanroblesvirtualawlibrary chanrobles virtual law
library
The fourth assignment of error relates to Exhibits A and B, being the appellees'
depositions made 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.chanroblesvirtualawlibrary chanrobles virtual law
library
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.chanroblesvirtualawlibrary chanrobles virtual law library
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.
The first of these questions tends to show the relationship between the principals and
their attorney-in-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 Exhibits
C to F, and H to I. 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.chanroblesvirtualawlibrary chanrobles virtual
law library
The facts in the case of Maxilom vs. Tabotabo (9 Phil., 390), differ from those in the case
at bar. In that case, 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 P1,062.37, Mexican currency, alleging 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. 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. We do not believe that this was the legislator's
intention.chanroblesvirtualawlibrary chanrobles virtual law library
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.chanroblesvirtualawlibrary chanrobles virtual law library
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.chanroblesvirtualawlibrary chanrobles virtual law library
Finally, the appellant complains that the trial court held by mere inference that Benigno
Goitia received from the "Tren de Aguadas" the amounts of P13,140 and P5,265 for
Mendezona and Izaguirre, respectively, as dividends for the years from 1915 to 1926,
inclusive, and in holding again, by mere inference, that Benigno Goitia did not remit said
sums to the plaintiffs.chanroblesvirtualawlibrary chanrobles virtual law library
It is a well established fact in the record that the plaintiffs had an interest or some shares
in the partnership called "Tren de Aguadas," Mendezona holding 180 shares, worth
P18,000, and Izaguirre, 72 shares worth P7,200. By the testimony of Ruperto Santos,
former secretary of Benigno Goitia and his successor in the administration of that
partnership, it appears that the deceased Benigno Goitia had received the dividends due
the appellees for the months of May and June, 1926. And according to Exhibit K-I, the
dividend for the months of May and June was P0.50 a share. And witness Ramon Salinas,
a practising attorney and one of the shareholders of the partnership "Tren de Aguadas,"
testified, from a notebook which he had, that he received from the "Tren de Aguadas" the
following ordinary dividends: P45 in 1915; P45 in 1916; P45 in 1917; P45 in 1918; P45
in 1919; P90 in 1920; P67.50 in 1921, and P45 each for 1922, 1923, 4924, 1925, and 1926.
By way of extraordinary dividends, the witness testified that he received P22.50 each
year from 1915 to 1918 inclusive; P45 in 1919; P60 in 1920; P37.50 in 1921, 1922, 1923,
and 1924; P15 in 1925; and P22.50 in 1926. He further stated that he received P165 in
1918 as his share of the proceeds of the sale of the boat Santolan. Summing up all these
amounts, we find that the witness Ramon Salinas, from 1915 to 1925, received a total of
P1,087.50.chanroblesvirtualawlibrary chanrobles virtual law library
It further appears that Ruperto Santos assured the court that the dividends for the period
from 1915 to 1926 have been distributed among the shareholders, and that the late
Benigno Goitia received the dividends due on the shares pertaining to Leonor Mendezona
and Valentina Izaguirre, deducting them from the total distribution. In view of these data,
the court below reached the conclusion, on the basis of the dividends received by partner
Ramon Salinas, that the attorney-in-fact Benigno Goitia received for the plaintiffs-
appellees, respectively, the amounts of P13,140 and P5.256, including the dividends for
1926, or P90 for Leonor Mendezona, and P36 for Valentina
Izaguirre.chanroblesvirtualawlibrary chanrobles virtual law library
As to the interest imposed in the judgment appealed from, it is sufficient to cite article
1724 of the Civil Code, which provides that an agent shall be liable for interest upon any
sums he may have applied to his own use, from the day on which he did so, and upon
those which he still owes, after the expiration of the agency, from the time of his
default.chanroblesvirtualawlibrary chanrobles virtual law library
The judgment appealed form being in accordance with the merits of the case, we are of
opinion, and so hold, that the same must be, as it is hereby, affirmed, with costs against
the appellant. So ordered.
GARCIA VS VDA DE CAPARAS

Under the Dead Man's Statute Rule, "if one party to the alleged transaction is precluded
from testifying by death, insanity, or other mental disabilities, the other party is not
entitled to the undue advantage of giving his own uncontradicted and unexplained
account of the transaction."1 Thus, the alleged admission of the deceased Pedro Caparas
(Pedro) that he entered into a sharing of leasehold rights with the petitioners cannot be
used as evidence against the herein respondent as the latter would be unable to
contradict or disprove the same.
This Petition for Review on Certiorari2 seeks to reverse and set aside the August 31, 2007
Decision3 of the Court of Appeals (CA) in CA-G.R. SP No. 90403;4 as well as its December
13, 2007 Resolution5denying petitioners' Motion for Reconsideration.
Factual Antecedents
Flora Makapugay (Makapugay) is the owner of a 2.5-hectare farm in Barangay Lugam,
Malolos, Bulacan (the land) covered by Transfer Certificate of Title No. (TCT) RT-65932
(T-25198)6 and being tilled by Eugenio Caparas (Eugenio) as agricultural lessee under a
leasehold agreement. Makapugay passed away and was succeeded by her nephews and
niece, namely Amanda dela Paz-Perlas (Amanda), Justo dela Paz (Justo) and Augusto dela
Paz (Augusto). On the other hand, Eugenio's children Modesta Garcia (Garcia), Cristina
Salamat (Salamat) and Pedro succeeded him.
Before she passed away, Makapugay appointed Amanda as her attorney-in-fact. After
Eugenio died, or in 1974, Amanda and Pedro entered into an agreement entitled
"Kasunduan sa Buwisan",7 followed by an April 19, 1979 Agricultural Leasehold
Contract,8 covering the land. In said agreements, Pedro was installed and recognized as
the lone agricultural lessee and cultivator of the land.
Pedro passed away in 1984, and his wife, herein respondent Dominga Robles Vda. de
Caparas (Dominga), took over as agricultural lessee.
On July 10, 1996, the landowners Amanda, Justo and Augusto, on the one hand, and
Pedro's sisters Garcia and Salamat on the other, entered into a "Kasunduan sa Buwisan
ng Lupa"9 whereby Garcia and Salamat were acknowledged as Pedro's co-lessees.
On October 24, 1996, herein petitioners Garcia and Salamat filed a Complaint10 for
nullification of leasehold and restoration of rights as agricultural lessees against Pedro's
heirs, represented by his surviving spouse and herein respondent Dominga. Before the
office of the Provincial Agrarian Reform Adjudicator (PARAD) of Bulacan, the case was
docketed as Department of Agrarian Reform Adjudication Board (DARAB) Case No. R-03-
02-3520-96.
In their Complaint, Garcia and Salamat claimed that when their father Eugenio died, they
entered into an agreement with their brother Pedro that they would alternately farm the
land on a "per-season basis"; that the landowner Makapugay knew of this agreement; that
when Makapugay passed away, Pedro reneged on their agreement and cultivated the land
all by himself, deliberately excluding them and misrepresenting to Amanda that he is
Eugenio's sole heir; that as a result, Amanda was deceived into installing him as sole
agricultural lessee in their 1979 Agricultural Leasehold Contract; that when Amanda
learned of Pedro's misrepresentations, she executed on July 10, 1996 an Affidavit11
stating among others that Pedro assured her that he would not deprive Garcia and
Salamat of their "cultivatory rights"; that in order to correct matters, Amanda, Justo and
Augusto executed in their favor the 1996 "Kasunduan sa Buwisan ng Lupa", recognizing
them as Pedro's co-lessees; that when Pedro passed away, Dominga took over the land
and, despite demands, continued to deprive them of their rights as co-lessees; that efforts
to settle their controversy proved futile, prompting the Barangay Agrarian Reform
Committee to issue the proper certification authorizing the filing of a case; and that they
suffered damages as a consequence. Petitioners prayed that the 1979 Agricultural
Leasehold Contract between Pedro and Amanda be nullified; that they be recognized as
co-lessees and allowed to cultivate the land on an alternate basis as originally agreed; and
that they be awarded P50,000.00 attorney's fees and costs of litigation.
In her Answer,12 herein respondent Dominga claimed that when her father-in-law
Eugenio died, only her husband Pedro succeeded and cultivated the land, and that
petitioners never assisted him in farming the land; that Pedro is the sole agricultural
lessee of the land; that Amanda's July 10, 1996 Affidavit and "Kasunduan sa Buwisan ng
Lupa" of even date between her and the petitioners are self-serving and violate the
existing 1979 Agricultural Leasehold Contract; that under Section 3813 of Republic Act
No. 384414 (RA 3844), petitioners' cause of action has prescribed. Dominga further
claimed that Pedro has been in possession of the land even while Eugenio lived; that
petitioners have never cultivated nor possessed the land even for a single cropping; that
Pedro has been the one paying the lease rentals as evidenced by receipts; that when Pedro
died in 1984, she succeeded in his rights as lessee by operation of law, and that she had
been remitting lease rentals to the landowners since 1985; and that petitioners had no
right to institute themselves as her co-lessees. She prayed that the Complaint be
dismissed; that the July 10, 1996 "Kasunduan sa Buwisan ng Lupa" be nullified; that the
execution of a new leasehold agreement between her and the landowners be ordered;
and by way of counterclaim, that moral damages15 and litigation costs be awarded her.
Ruling of the PARAD against the landowners and petitioners. On petitioners' motion, the case was
dismissed.18chanroblesvirtualawlibrary
After hearing and consideration of the parties' respective position papers and other
submissions, the PARAD issued on May 4, 1998 a Decision,16 which decreed as Ruling of the DARAB
follows:chanroblesvirtualawlibrary
Petitioners appealed the May 4, 1998 PARAD Decision in DARAB Case No. R-03-02-3520-
WHEREFORE, premises considered, judgment is hereby rendered in favor of the 96 to the DARAB, where the case was docketed as DARAB Case No. 972219 (DCN 9722).
defendant and against the plaintiffs and Order is hereby Dominga likewise appealed the dismissal of DARAB Case No. 03-03-10307-99, which
issued:chanroblesvirtualawlibrary appeal was docketed as DARAB Case No. 11155 (DCN 11155). On motion, both appeals
were consolidated.
1. ORDERING the dismissal of the case;cralawlibrary
On June 15, 2005, the DARAB issued its Decision,20 the dispositive portion of which
2. DECLARING defendant Dominga Robles Vda. de Caparas as lawful successor-
reads, as follows:chanroblesvirtualawlibrary
tenant;cralawlibrary
WHEREFORE, premises considered, a new judgment is hereby
3. ORDERING plaintiffs to maintain defendant in her peaceful possession and cultivation
rendered:chanroblesvirtualawlibrary
of the subject landholding;cralawlibrary
1. DECLARING Dominga Robles Vda. de Caparas as the lawful successor-tenant of Pedro
4. ORDERING the MARO of Malolos, Bulacan to execute a new leasehold contract between
Caparas over the subject landholding;cralawlibrary
the landowner and defendant Dominga Robles Vda. de Caparas;cralawlibrary
2. ORDERING the plaintiffs in DCN 9722 and the respondents in DCN 11155 or any person
5. No pronouncement as to costs.
acting in their behalves [sic], to maintain Dominga Robles Vda. de Caparas in peaceful
SO ORDERED.17chanroblesvirtualawlibrary possession and cultivation of the subject landholding;cralawlibrary

The PARAD held that Amanda's act of executing the July 10, 1996 Affidavit and 3. ORDERING the MARO of Malolos, Bulacan, to execute a new leasehold contract between
"Kasunduan sa Buwisan ng Lupa" amounted to dispossession of Pedro's landholding and the landowner and Dominga Robles Vda. de Caparas; and
rights without cause; that Amanda's 1996 disclaimer, after having installed Pedro as
4. ORDERING for the dismissal of DCN 11155 for being moot and academic.
tenant in 1979, was belated and unjustified; that petitioners have not shown by evidence
that they actually cultivated the land, or that they paid rentals to the landowners; that SO ORDERED.21chanroblesvirtualawlibrary
petitioners' cause of action has prescribed in accordance with Section 38 of RA 3844; that
In upholding the PARAD Decision, the DARAB held that contrary to petitioners' claim,
for failure to timely question Pedro's leasehold, his rights were transferred, by operation
there was no alternate farming agreement between the parties, and thus petitioners may
of law, to Dominga upon his death. Finally, the PARAD held that petitioners' July 10, 1996
not claim that they were co-lessees; that Pedro merely shared his harvest with petitioners
"Kasunduan sa Buwisan ng Lupa" is null and void for being issued against Pedro's existing
as an act of generosity, and Dominga's act of stopping this practice after succeeding Pedro
1979 Agricultural Leasehold Contract, which has not been cancelled by competent
prompted petitioners to file DARAB Case No. R-03-02-3520-96 and claim the status of co-
authority.
lessees; that Amanda's Affidavit and the 1996 "Kasunduan sa Buwisan ng Lupa" between
DARAB Case No. 03-03-10307-99 the landowners and petitioners cannot defeat Pedro's 1979 Agricultural Leasehold
Contract and his rights as the sole tenant over the land; that for sleeping on their rights,
It appears that sometime after the execution of the July 10, 1996 "Kasunduan sa Buwisan
petitioners are now barred by laches from claiming that they are co-lessees; and that
ng Lupa" and during the pendency of DARAB Case No. R-03-02-3520-96, petitioners
petitioners' 1996 "Kasunduan sa Buwisan ng Lupa" is null and void for being contrary to
entered the land and began tilling the same. For this reason, Dominga filed DARAB Case
law, morals, public policy, and Pedro's 1979 Agricultural Leasehold Contract, which was
No. 03-03-10307-99, for maintenance of peaceful possession with injunctive relief,
subsisting and which has not been cancelled by competent authority.
Ruling of the Court of Appeals
Petitioners filed before the CA a Petition for Certiorari, which was docketed as CA-G.R. SP
No. 90403, seeking to set aside the DARAB Decision. The sole basis of their Petition rests
on the argument that as a result of a May 9, 2005 Order issued by the Regional Technical
Director (Region III) of the Department of Environment and Natural Resources, the
survey returns and plans covering TCT RT-65932 have been cancelled, which thus
rendered the June 15, 2005 DARAB Decision null and void and a proper subject of
certiorari.
On August 31, 2007, the CA issued the assailed Decision which decreed as
follows:chanroblesvirtualawlibrary
IN LIGHT OF ALL THE FOREGOING, the instant petition is DENIED. The assailed decision
is AFFIRMED in toto.
SO ORDERED.22chanroblesvirtualawlibrary
The CA held that the issue raised by petitioners the cancellation of the survey returns and
plans covering TCT RT-65932 was not part of their causes of action in the PARAD or
DARAB, and this new issue changed the theory of their case against Dominga, which is
not allowed. The CA added that it could not decide the case on the basis of a question
which was not placed in issue during the proceedings below.
The CA held further that even granting that the issues are resolved on the merits, the
petition would fail; the cancellation of the survey returns and plans covering TCT RT-
65932 reverts the property to its original classification as agricultural land which thus
vindicates the leasehold agreements of the parties. And speaking of leasehold
agreements, the CA held that petitioners may not be considered as Pedro's co-lessees, for
lack of proof that they actually tilled the land and with petitioners' own admission in their
pleadings that they merely received a share from Pedro's harvests; that the original 1974
and 1979 leasehold agreements between Makapugay, Amanda and Pedro categorically
show that Pedro is the sole designated agricultural lessee; and that without proper legal
termination of Pedro's lease in accordance with RA 3844, the landowners cannot
designate other tenants to the same land in violation of the existing lessee's rights.
Petitioners moved for reconsideration, arguing that the land has been re- classified as
residential land, and has been actually used as such. Petitioners cited a 1997 ordinance,
Malolos Municipal Resolution No. 41-97,23 which adopted and approved the zoning
ordinance and the Malolos Development Plan prepared jointly by the Housing and Land
Use Regulatory Board and the Malolos Sangguniang Bayan. In the assailed December 13,
2007 Resolution,24 the CA denied the Motion for Reconsideration.
Issues
In this petition, the following errors are assigned:chanroblesvirtualawlibrary
1. x x x RESPONDENT'S ACT OF HAVING BUILT THREE (3) HOUSES (FOR HERSELF AND
TWO OF HER CHILDREN), WAS "CONVERSION OF THE FARMHOLD INTO A HOUSING-
RESIDENTIAL SUBDIVISION" AND THEREFORE, SHE IS NOT BEING PUT IN SURPRISE
NOR IN UNFAIR SITUATION. CONSEQUENTLY, SHE IS THE PARTY IN ESTOPPEL. AND
FROM THE TIME BY HER ACTS OF SELF-CONVERSION OF THE LAND, IN THE EARLY 90S
OR EARLIER, SHE "LOST HER SECURITY OF TENURE" AS AGRICULTURAL LESSEE.
2. THE DECISIONS OF THE DARAB PROVINCIAL ADJUDICATOR, DARAB CENTRAL
OFFICE, AND THE HONORABLE COURT OF APPEALS, SPEAK OF NO HOMELOT HAVING
BEEN AWARDED BY THE DEPARTMENT OF AGRARIAN REFORM TO PRIVATE
RESPONDENT.
3. ACTUAL PHYSICAL CHANGE IN THE USE OF THE LAND FROM AGRICULTURAL TO
"RESIDENTIAL" MAY OCCUR AFTER TRIAL, BUT DURING THE APPEAL, WHICH THE
HON. COURT OF APPEALS MAY CONSIDER.
4. "CONVERSION" (WHICH REQUIRES PRIOR APPROVAL BY THE DAR) HAVING BECOME
A "FAIT ACCOMPLI", SECTION 220 OF THE REAL ESTATE TAX CODE AND ARTICLE 217
OF THE LOCAL GOVERNMENT CODE OF 1991 AFFIRM THE TRUSTWORTHINESS OF THE
TAX DECLARATION THAT IS, THE PREVIOUS FARMHOLD HAS BEEN CONVERTED INTO
"RESIDENTIAL" LAND, AND CONFIRMED BY THE CITY ZONING DIRECTOR.
5. IN NOT HAVING CONSIDERED THE TAX DECLARATION AND THE ZONING
CERTIFICATION x x x, THE HON. COURT OF APPEALS COMMITTED A VERY
FUNDAMENTAL ERROR.25chanroblesvirtualawlibrary
Petitioners' Arguments
In their Petition and Reply,26 petitioners this time argue that in building houses upon the
land for herself and her children without a homelot award from the Department of
Agrarian Reform, Dominga converted the same to residential use; and by this act of
conversion, Dominga violated her own security of tenure and the land was removed from
coverage of the land reform laws. They add that the Malolos zoning ordinance and the tax
declaration covering the land effectively converted the property into residential land.
Petitioners justify their change of theory, the addition of new issues, and the raising of
factual issues, stating that the resolution of these issues are necessary in order to arrive
at a just decision and resolution of the case in its totality. They add that the new issues
were raised as a necessary consequence of supervening events which took place after the
Decisions of the PARAD and DARAB were issued.
Respondent's Arguments
In her Comment,27 Dominga argues that the Petition raises questions of fact which are
not the proper subject of a Petition under Rule 45 of the Rules. She adds that petitioners
raised anew issues which further changed the theory of their case, and which issues may
not be raised for the first time at this stage of the proceedings.
Our Ruling
The Petition is denied.
DARAB Case No. R-03-02-3520-96, which was filed in 1996 or long after Pedro's death in
1984, has no leg to stand on other than Amanda's declaration in her July 10, 1996
Affidavit that Pedro falsely represented to Makapugay and to her that he is the actual
cultivator of the land, and that when she confronted him about this and the alleged
alternate farming scheme between him and petitioners, Pedro allegedly told her that "he
and his two sisters had an understanding about it and he did not have the intention of
depriving them of their cultivatory rights."28 Petitioners have no other evidence, other
than such verbal declaration, which proves the existence of such arrangement. No written
memorandum of such agreement exists, nor have they shown that they actually cultivated
the land even if only for one cropping. No receipt evidencing payment to the landowners
of the latter's share, or any other documentary evidence, has been put forward.
What the PARAD, DARAB and CA failed to consider and realize is that Amanda's
declaration in her Affidavit covering Pedro's alleged admission and recognition of the
alternate farming scheme is inadmissible for being a violation of the Dead Man's
Statute,29 which provides that "[i]f one party to the alleged transaction is precluded from
testifying by death, insanity, or other mental disabilities, the other party is not entitled to
the undue advantage of giving his own uncontradicted and unexplained account of the
transaction."30 Thus, since Pedro is deceased, and Amanda's declaration which pertains
to the leasehold agreement affects the 1996 "Kasunduan sa Buwisan ng Lupa" which she
as assignor entered into with petitioners, and which is now the subject matter of the
present case and claim against Pedro's surviving spouse and lawful successor-in-interest
Dominga, such declaration cannot be admitted and used against the latter, who is placed
in an unfair situation by reason of her being unable to contradict or disprove such
declaration as a result of her husband-declarant Pedro's prior death.
If petitioners earnestly believed that they had a right, under their supposed mutual
agreement with Pedro, to cultivate the land under an alternate farming scheme, then they
should have confronted Pedro or sought an audience with Amanda to discuss the
possibility of their institution as co-lessees of the land; and they should have done so soon
after the passing away of their father Eugenio. However, it was only in 1996, or 17 years
after Pedro was installed as tenant in 1979 and long after his death in 1984, that they
came forward to question Pedro's succession to the leasehold. As correctly held by the
PARAD, petitioners slept on their rights, and are thus precluded from questioning Pedro's
1979 agricultural leasehold contract.
Amanda, on the other hand, cannot claim that Pedro deceived her into believing that he
is the sole successor to the leasehold. Part of her duties as the landowner's representative
or administrator was to know the personal circumstances of the lessee Eugenio; more
especially so, when Eugenio died. She was duty-bound to make an inquiry as to who
survived Eugenio, in order that the landowner or she as representative could choose from
among them who would succeed to the leasehold. Under Section 9 of RA 3844,
Makapugay, or Amanda as Makapugay's duly appointed representative or administrator
was required to make a choice, within one month from Eugenio's death, who would
succeed as agricultural lessee. Thus:chanroblesvirtualawlibrary
Section 9. Agricultural Leasehold Relation Not Extinguished by Death or Incapacity of the
Parties - In case of death or permanent incapacity of the agricultural lessee to work his
landholding, the leasehold shall continue between the agricultural lessor and the person
who can cultivate the landholding personally, chosen by the agricultural lessor within one
month from such death or permanent incapacity, from among the following: (a) the
surviving spouse; (b) the eldest direct descendant by consanguinity; or (c) the next eldest
descendant or descendants in the order of their age: Provided, That in case the death or
permanent incapacity of the agricultural lessee occurs during the agricultural year, such
choice shall be exercised at the end of that agricultural year: Provided, further, That in
the event the agricultural lessor fails to exercise his choice within the periods herein
provided, the priority shall be in accordance with the order herein established.
In case of death or permanent incapacity of the agricultural lessor, the leasehold shall
bind his legal heirs. (Emphasis supplied)
Amanda may not claim ignorance of the above provision, as ignorance of the law excuses
no one from compliance therewith.31 Thus, when she executed the 1979 Agricultural
Leasehold Contract with Pedro, she is deemed to have chosen the latter as Eugenio's
successor, and is presumed to have diligently performed her duties, as Makapugay's
representative, in conducting an inquiry prior to making the choice.
The same holds true for petitioners. They should be held to a faithful compliance with
Section 9. If it is true that they entered into a unique arrangement with Pedro to
alternately till the land, they were thus obliged to inform Makapugay or Amanda of their
arrangement, so that in the process of choosing Eugenio's successor, they would not be
left out. But evidently, they did not; they slept on their rights, and true enough, they were
excluded, if there was any such alternate farming agreement between them. And after
Pedro was chosen and installed as Eugenio's successor, they allowed 17 years to pass
before coming out to reveal this claimed alternate farming agreement and insist on the
same.
With the above pronouncements, there is no other logical conclusion than that the 1996
"Kasunduan sa Buwisan ng Lupa" between Amanda and petitioners, which is grounded
on Pedro's inadmissible verbal admission, and which agreement was entered into
without obtaining Dominga's consent, constitutes an undue infringement of Dominga's
rights as Pedro's successor-in-interest under Section 9, and operates to deprive her of
such rights and dispossess her of the leasehold against her will. Under Section 732 of RA
3844, Dominga is entitled to sennity of tenure; and under Section 16,33 any modification
of the lease agreement must be done with the consent of both parties and without
prejudicing Dominga's security of tenure.
This Court shall not delve into the issue of re-classification or conversion of the land. Re-
classification/conversion changes nothing as between the landowners and Dominga in
regard to their agreement, rights and obligations. On the contrary, re-
classification/conversion can only have deleterious effects upon petitioners' cause. Not
being agricultural lessees of the land, petitioners may not benefit at all, for under the law,
only the duly designated lessee -herein respondent - is entitled to disturbance
compensation in case of re-classification/conversion of the landholding into residential,
commercial, industrial or some other urban purposes.34 Besides, a valid re-classification
of the land not only erases petitioners' supposed leasehold rights; it renders them illegal
occupants and sowers in bad faith thereof, since from the position they have taken as
alleged lessees, they are not the owners of the land.
WHEREFORE, the Petition is DENIED. The assailed August 31, 2007 Decision and
December 13, 2007 Resolution of the Court of Appeals are AFFIRMED.
SO ORDERED.
DISQUALIFICATION BY REASON OF MARRIAGE/PRIVELEGED COMMUNICATION
PEOPLE VS FRANCISCO
Convicted of the crime of parricide by the Court of First Instance of Mindoro, Juan
Francisco appeals to this Court and asks us to reverse the decision of the trial court and
to acquit him of the crime charged.chanroblesvirtualawlibrary chanrobles virtual law
library
On March 4, 1945, defendant, who had been previously arrested on charges of robbery,
was being held as detention prisoner in the municipal jail of Mansalay, Mindoro. On that
date he requested permission from the chief of police, and he was allowed to go with
Sergeant Pacifico Pimentel, who was detailed to guard him. Upon their reaching the
house, the sergeant allowed the prisoner to see his wife who was at the time in a room of
said house, while said sergeant remained at the foot of the stairs. After a few moments,
Pimentel heard the scream of a woman. Running upstairs, he met defendant's wife
running out of the room and holding her right breast which was bleeding. Still moments
later, Pimentel saw defendant lying down with his little son Romeo, aged one year and a
half, on his breast. Pimentel also found defendant to have a wound in his belly while his
child had a wound in the back. Pimentel found the child dead.chanroblesvirtualawlibrary
chanrobles virtual law library
The prosecution, in recommending the imposition of the capital penalty upon the
accused, relies mainly on: (1) the affidavit, Exhibit C (translation, Exhibit C-1), which is a
virtual confession of the accused; (2) Exhibit D, which is the record made by the justice of
the peace of Mansalay of the arraignment of the defendant upon which the latter entered
a plea of guilty; and (3) the rebuttal testimony of Emilia Taladtad, wife of the
appellant.chanroblesvirtualawlibrary chanrobles virtual law library
Exhibit C is an affidavit signed and sworn to by the appellant before the justice of the
peace of Mansalay on March 5, 1945,. Exhibit C-1 is its English translation. In said affidavit
appellant declares that: "I asked permission from the chief of police so that I may be able
to raise my bond and to indicate to me the house of one Guillermo Gervasio, a policeman,
and I was consented and the sergeant of police accompanied me to my house; that upon
arriving at the house, Sgt. Pacifico Pimentel allowed me to go up in order that I may be
able to talk to my wife and the sergeant of police awaited me in the stairs of the house;
when I was in the house, I remembered what my uncle told me to the effect that he would
order someone to kill me because I am a shame and a dishonor to our family and suddenly
I lost my sense and I thought to myself that if someone would kill me it would be more
preferable for me to kill myself; when I looked at the bed I saw a scissor near my wife and
unconsciously I picked up the said scissor and immediately stabbed my wife whereupon
I looked for my child on the bed and stabbed him; I killed my son Romeo Francisco whose
age is more or less two years and after that I stabbed myself; after stabbing myself, I heard
a shot and the sergeant of police asked me if I would surrender to him or not; I replied
him "yes" then I lost my consciousness."chanrobles virtual law library
Sergeant of Police Pimentel, whose veracity we find in the evidence no reason to doubt,
declared (p. 6, t.s.n., Lunar) that the accused confessed to him that because he was already
tired or disgusted with his life "on account of the accusation of his father-in-law" against
him, he wanted to wipe out his family by stabbing his wife, his son and himself, and killing
the three of them. The same witness also stated (p. 9, ibid.) that the accused confessed to
him that he stabbed his wife, his child and himself because he was ashamed, as his father-
in-law told him that he should rather die than live in shame for having dishonored the
family of his wife.chanroblesvirtualawlibrary chanrobles virtual law library
The voluntariness and spontaniety of the confession contained in Exhibit C was testified
to by the justice of the peace of Mansalay and police sergeant Pimentel, one Sebastian
Punzalan, and the chief of police Alfredo Iwahi; that said justice of the peace had
previously read the contents of the same affidavit to the accused and that the accused
signed without any intimidation having been exerted in the presence of said justice of the
peace; that the accused signed voluntarily in the session hall of the justice of the peace
court in Barrio Paclasan (pp. 26-27, ibid.) Pimentel testified, upon the same point, that no
force was exerted upon appellant to state what is contained in the affidavit; that he had
not maltreated or boxed the accused as pretended by the latter; that the contents of the
exhibit were read to the accused; that he did not threatened the accused to shoot the latter
if he would not swear to Exhibit C before the justice of the peace, as declared by said
accused (pp. 25-26, ibid.) In this connection we note from the testimony of the accused
himself that on the way to the house of the justice of the peace after the incident, he was
being helped by the chief of police Iwahi when, according to him, Sergeant Pimentel told
him that he was going to swear to the contents of Exhibit C and that if he would not do so
Pimentel would shoot him (p. 17, ibid.); that (the same accused assured the court) Iwahi
treated him well (t.s.n., p. 20, ibid.); and really from the entire testimony of this accused
the good treatment accorded him by Chief of Police Iwahi is clearly discernible. He was
under preventive detention in the house of Iwahi and it was Iwahi who suggested or told
him, after he had killed and dressed the former's pig, that he bring a kilo of the meat to
his (appellant's) wife (p. 13, ibid.) It was also Iwahi who allowed him to go to his house
on the same occasion for the purposes of the procurement of his bail (p. 13,
ibid.).chanroblesvirtualawlibrary chanrobles virtual law library
Under these circumstances, besides the complete absence of proof of any reason or
motive why Pimentel should so threaten the accused, we find the accused's version
incredible. On page 16 of the same transcript, answering a question by the Court of First
Instance, the accused testified that he understands English and the translation Exhibit C-
1 of the affidavit Exhibit C is in that language.chanroblesvirtualawlibrary chanrobles
virtual law library
Other indications of appellant's lack of trustworthiness are: While on page 14 of said
transcript he testified that he was the only one who went to the house of his wife because
Pimentel, according to him, remained in the house of Roberto Magramo, on page 13 he
declared that he was accompanied by the sergeant of police of Mansalay, Pacifico
Pimentel to the house of his wife and that the chief of police ordered Pimentel to so
accompany him. Contradicting the same pretension of his having gone alone to his wife's
house is his own testimony on page 17 of the transcript wherein he assured affirmatively
the question of his own counsel whether Pimentel was the policeman who was with him
to guard him on the occasion of his going to his wife's house; and really, while he imputed
upon his wife the wounding of their child, who died as a consequence thereof, he admitted
that he did not tell this to the justice of the peace of Mansalay (p. 18, ibid.), and the reason
he assigned for this passive conduct on his part to the effect that he was afraid of Pimentel
(p. 19, ibid.) is patently unacceptable, for no motive whatsoever has been established to
make us believe that the accused had reasons to be so afraid of Pimentel. Appellant's
testimony to the effect that Pacifico Pimentel was testifying against him because Pimentel
"being my guard that time he might be held responsible for allowing me to go alone" (p.
17, ibid.) is absolutely without merit. This testimony clearly reveals a desire to show that
because Pimentel allowed the accused to go up the house while the former stayed at the
foot of the stairs, said Pimentel would be responsible for what had happened unless the
accused was the one who killed the child and wounded his wife rather than the wife
having accidentally wounded the child and killed him and been stabbed by the accused,
who also stabbed himself. As we said a moment ago, we do not give any merit to this
purpose in testifying against the accused to relieve himself of all responsibility for what
had happened, it would have been more conducive to this result if Pimentel had testified
that it was not the accused, whom he had allowed to go upstairs unguarded, who was
guilty, but his wife, of the wounding of the child, and that the accused wounded his wife
only as the result of the obfuscation produced by the child's death. And the fact that
Pimentel gave the version which might place no small blame on him for allowing the
accused to go up the house alone, gives special weight to his
testimony.chanroblesvirtualawlibrary chanrobles virtual law library
This case, as developed by the evidence for the prosecution, which has not been destroyed
nor enervated by that of the defense, presents a truly strange happening. But the fact of
the commission of the crime of parricide appears to us to have been established beyond
reasonable doubt. As to the reasons impelling the commission of the act, the case is a
strange one and admittedly not common. But while it is not necessary even to prove
motive in case the commission of the crime is established as required by law (U.S. vs.
Ricafor, 1 Phil., 173; U.S. vs. McMann, 4 Phil., 561; U.S. vs. Reyes, 18 Phil., 495; U.S. vs.
Balmori and Apostol, 18 Phil., 578), here we have a case of a crime proven beyond
reasonable doubt, not absolutely without a proven motive, but with proof of a motive
testified to by the accused himself in his confession, strange though it be. But at times
"truth is stranger than fiction," and it so happens here. The law must be applied to the
facts.chanroblesvirtualawlibrary chanrobles virtual law library
We have scanned and searched the evidence and the record diligently for facts and
circumstances which might sufficiently establish insanity or any allied defense, but we
have failed to find them.chanroblesvirtualawlibrary chanrobles virtual law library
As we construe the evidence, we believe that Exhibit C contains the truth, as narrated by
the accused himself who, at the time of making it, must have been moved only by the
determination of a repentant father and husband to acknowledge his guilt for facts which,
though perhaps done under circumstances productive of a diminution of the exercise of
will-power, fell short of depriving the offender of consciousness of his acts. We will have
occasion to further consider this aspect of the case later.chanroblesvirtualawlibrary
chanrobles virtual law library
Exhibit C was signed and sworn to by appellant the day following the fatal event.
Presumably, on making this confession appellant had not yet had time to reflect upon the
consequences of such a confession to himself - egoism was not yet allowed to operate
against the promptings of his conscience. But when on February 23, 1946 - almost one
year after - this man testified in his own defense in the Court of First Instance, he already
had had ample opportunity to reflect upon those consequences. And what happened? As
in similar cases, he repudiated his confession, and alleged torture and violence to have
been exerted upon his person and his mind in order, so he now pretends, to extract it
from him. As we find the confession to have been given voluntarily, we feel justified in
concluding that its subsequent repudiation by the accused almost a year after must have
been due to his fear of its consequences to himself, which he not improbably thought
might cost him his own life. It was the struggle between the noble and the ignoble in the
man, and the latter, aided by instinct of self-preservation,
won.chanroblesvirtualawlibrary chanrobles virtual law library
Defense counsel attacks the value of Exhibit C as evidence of guilt for the reason that the
statements contained therein were not, counsel contends, given spontaneously but
through use of violence and intimidation. He also questions the admissibility of Exhibit D
on the ground that it has not been properly identified; and, with more vigor and stronger
emphasis, he impugns the admissibility of the testimony of appellant's wife, invoking the
provision of section 26 (d) of Rule 123 prohibiting the wife and the husband from
testifying for or against each other.chanroblesvirtualawlibrary chanrobles virtual law
library
As to Exhibit C, this document was sworn to and subscribed by said accused before the
justice of the peace of Mansalay. This official testified that he asked the prisoner before
the latter signed said exhibit whether he understood the contents thereof, and that said
latter answered in the affirmative. The witness further declared that appellant signed the
exhibit voluntarily and that said appellant said that the said affidavit was his (p. 10, ibid.).
There is a total absence of evidence, besides the testimony of appellant himself, to show
that his statements contained in said exhibit were extracted form him by the use of
violence and intimidation. While we are not unaware of the practice resorted to by some
peace officers of extracting admissions or confessions from persons accused of crime by
the employment of third-degree methods, in the present case we fail to find from the
evidence sufficient proof to destroy the categorical testimony of the justice of the peace
that Exhibit C was signed by appellant voluntarily and with a full understanding thereof.
Furthermore, the statements of appellant in said Exhibit C were corroborated by the
testimony of his wife on rebuttal. This leads us to the consideration of the admissibility
of the wife's testimony.chanroblesvirtualawlibrary chanrobles virtual law library
The rule contained in section 265 (d) of Rule 123 is an old one. Courts and text-writers
on the subject have assigned as reasons therefor the following: First, identity of interest;
second, the consequent danger of perjury; third, the policy of the law which deems it
necessary to guard the security and confidences of private life even at the risk of an
occasional failure of justice, and which rejects such evidence because its admission would
lead to domestic disunion and unhappiness; and fourth, because where a want of
domestic tranquility exists, there is danger of punishing one spouse through the hostile
testimony of the other. This has been said in the case of Cargill vs. State (220 Pac., 64; 25
Okl. Cr., 314; 35 A.L.R., 133), thus:
The reasons given by law text-writers and courts why neither a husband nor wife shall in
any case be a witness against the other except in a criminal prosecution for a crime
committed by one against the other have been stated thus: First, identity of interests;
second, the consequent danger of perjury; third, the policy of the law which deems it
necessary to guard the security and confidences of private life even at the risk of an
occasional failure of justice, and which rejects such evidence because its admission would
lead to domestic disunion and unhappiness; and fourth, because, where a want of
domestic tranquility exists, there is danger of punishing one spouse through the hostile
testimony of the other. (70 C.J., 119.)
However, as all other general rules, this one has its own exceptions, both in civil actions
between the spouses and in criminal cases for offenses committed by one against the
other. Like the rule itself, the exceptions are backed by sound reasons which, in the
excepted cases, outweigh those in support of the general rule. For instance, where the
marital and domestic relations are so strained that there is no more harmony to be
preserved nor peace and tranquility 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.chanroblesvirtualawlibrary chanrobles virtual law library
At any rate, in the instant case the wife did not testify in the direct evidence for the
prosecution but under circumstances presently to be stated. It will be noted that the wife
only testified against her husband after the latter, testifying in his own defense, imputed
upon her the killing of their son. (p. 15, ibid.) By all rules of justice and reason this gave
the prosecution, which had theretofore refrained from presenting the wife as a witness
against her husband, the right to do so, as it did in rebuttal; and the the wife herself the
right to so testify, at least, in self-defense, not of course, against being subjected to
punishment in that case in which she was not a defendant but against any or all of various
possible consequences which might flow from her silence, namely: (1) a criminal
prosecution against her which might be instituted by the corresponding authorities upon
the basis of her husband's aforesaid testimony; (2) in the moral and social sense, her
being believed by those who heard the testimony orally given, as well as by those who
may read the same, once put in writing, to be the killer of her infant child. It has been aptly
said that the law of evidence is the law of common sense. Presuming the husband who so
testified against his wife to be endowed with common sense, he must be taken to have
expected that the most natural reaction which the said testimony would give rise to on
the part of the prosecution, as well as of his wife, was to deny upon rebuttal the new
matter which was involved in the same testimony, namely, the imputation that it was his
wife who killed their little son. Upon the part of the prosecution, because he not only
limited himself to denying that he was the killer, but went further and added what was
really a new matter consisting in the imputation of the crime upon his wife. And upon the
part of the wife, because of the reasons already set forth above. Hence, in giving such
testimony, the husband must, in all fairness, be held to have intended all its aforesaid
natural and necessary consequences. By his said act, the husband - himself exercising the
very right which he would deny to his wife upon the ground of their marital relations -
must be taken to have waived all objection to the latter's testimony upon rebuttal, even
considering that such objection would have been available at the
outset.chanroblesvirtualawlibrary chanrobles virtual law library
At this point, it behooves us to emphasize the all-important role of the State in this case.
The State being interested in laying the truth before the courts so that the guilty may be
punished and the innocent exonerated, must have the right to offer the rebutting
testimony in question, even against the objection of the accused, because it was the latter
himself who gave rise to its necessity. It may be said that the accused husband thought
that he would have more chances of convincing the court of his pretended innocence if he
pointed to his wife as having caused the death of their child, instead of simply denying
that he was the author of the fatal act. To this we would counter by saying that if he was
to be allowed, for his convenience, to make his choice and thereby impute the act upon
his spouse, justice would be partial and one-sided if both the State and the wife were to
be absolutely precluded from introducing the latter's rebutting
testimony.chanroblesvirtualawlibrary chanrobles virtual law library
As well-settled as this rule of marital incompetency itself is the other that it may be
waived.
Waiver of incompetency. - Objections to the competency of a husband or wife to testify in
a criminal prosecution against the other may be waived as in the case of the other
witnesses generally. Thus, the accused waives his or her privilege by calling the other
spouse as a witness for him or her, thereby making the spouse subject to cross-
examination in the usual manner. It is well-established that where an accused introduces
his wife as a witness in his behalf, the state is entitled to question her as to all matters
germane and pertinent to her testimony on direct examination. It is also true that
objection to the spouse's competency must be made when he or she is first offered as
witness, and that the incompetency may be waived by the failure of the accused to make
timely objection to the admission of the spouse's testimony, although knowing of such
incompetency, and the testimony admitted, especially if the accused has assented to the
admission, either expressly or impliedly. Other courts have held that the witness's
testimony is not admissible even with the other spouse's consent. Clearly, if the statute
provides that a spouse shall in no case testify against the other except in a prosecution
for an offense against the other, the failure of the accused to object does not enable the
state to use the spouse as a witness. (3 Wharton's Criminal Evidence, 11th Ed., section
1205, pp. 2060-2061.)
Wharton, in note 10 at the foot of page 2060 of the cited volume refers us to section 1149
appearing on page 1988 of the same volume, dealing with waiver objection to
incompetency of witnesses in general. We transcribe this section for convenient
reference:
Waiver of objection to incompetency. - A party may waive his objection to the competency
of a witness and permit him to testify. A party calling an incompetent witness as his own
waives the incompetency. Also, if, after such incompetency appears, there is failure to
make timely objection, by a party having knowledge of the incompetency, the objection
will be deemed waived, whether it is on the ground of want of mental capacity or for some
other reason. If the objection could have been taken during the trial, a new trial will be
refused and the objection will not be available on writ of error. If, however, the objection
of a party is overruled and the ruling has been excepted to, the party may thereafter
examine the witness upon the matters as to which he was allowed to testify to without
waiving his objections to the witness's competency. (Ibid., section 1149, p. 1988.)
It will be noted, as was to be expected, that in the last above-quoted section, the author
mentions certain specific cases where the courts concerned hold that there was waiver,
but for obvious reasons neither the author nor said courts have attempted to make an
enumeration of all possible cases of waiver. In the very nature of things, it would be
impossible to make a priori such a complete enumeration and to say that it is exclusive.
So long as the Legislature itself does not make its own statutory and exclusive
specification of cases of such waiver - and we doubt that it ever will - no complete and
exclusive enumeration can, nor should, be attempted by the courts, for in the absence of
such legislation the cases of waiver will be as indefinite in number as indefinite are and
always will be the varying and unpredictable circumstances surrounding each particular
case.chanroblesvirtualawlibrary chanrobles virtual law library
To illustrate, Mr. Wharton says above that the accused waives his or her privilege by
calling the other spouse as a witness for him or her, thereby making the spouse subject
to cross-examination in the usual manner, the reason being that the State is entitled to
question the spouse so presented as to all matters germane and pertinent to the direct
testimony. In the same way, and for a similar reason, when the herein appellant gave his
testimony in question in his defense, the State had the right to rebut the new matter
contained in that testimony consisting in the imputation upon his wife of the death of the
little boy. And that rebuttal evidence, which was rendered necessary by appellant's own
testimony, could be furnished only by his wife who, as he fully knew, was alone with him
and their son at the precise place and time of the event. This right to rebut is secured to
the State, no less than to the accused, by Rule 115, section 3, paragraph (c), the provision
further authorizing the court, in furtherance of justice, to permit one or the other party
to offer "new additional evidence bearing upon the main issue in question." So that if the
waiver that we here declare to flow from the above-mentioned testimony of appellant
does not happen to be among those which were mentioned in the cases cited by Mr.
Wharton, that is no reason against the existence of said
waiver.chanroblesvirtualawlibrary chanrobles virtual law library
When the husband testified that it was his wife who caused the death of their son, he
could not, let us repeat, justly expect the State to keep silent and refrain from rebutting
such new matter in his testimony, through the only witness available, namely, the wife;
nor could he legitimately seal his wife's lips and thus gravely expose her to the danger of
criminal proceedings against her being started by the authorities upon the strength and
basis of said testimony of her husband, or to bear the moral and social stigma of being
thought, believed, or even just suspected, to be the killer of her own offspring. A decent
respect and considerate regard for the feelings of an average mother will tell us that such
a moral and social stigma would be no less injurious to her than a criminal punishment.
And if the wife should, in such a case and at such a juncture, be allowed to testify upon
rebuttal, the scope of her testimony should at least be the same as that of her husband.
This is only simple justice and fairness dictated by common sense. Since the husband had
testified that it was his wife who caused the death of the little boy, she should be allowed
to say that it was really her husband who did it. We hold that it is not necessary, to justify
such rebuttal evidence, and to declare the existence of the waiver upon which it was
based, that the wife be in jeopardy of punishment in the same case by reason of such
testimony of her accused husband. The rule of waiver of objection to the competency of
witnesses generally does not require this prerequisite in the case between husband and
wife. Rather the rule makes the determination of the question hinge around the
consequences which by common sense, in justice and in fairness, should be deemed to
have been expected by the spouse who first testified naturally to flow from his act of
giving that testimony. At any rate, the trial court not only had the power to allow the State
to utilize the wife as rebuttal witness, but also the discretion to permit "new additional
evidence bearing upon the main issue in question." But even restricting the wife's
testimony to merely contradicting her husband's version that she was the one who killed
their child, there is evidence beyond reasonable doubt that appellant was the killer. With
the testimony of both spouses upon the point, instead of that of the accused alone, let
justice take its course.chanroblesvirtualawlibrary chanrobles virtual law library
As to Exhibit D, this document was a part of the record of the case in the justice of the
peace of court which was expressly presented by the prosecution as evidence in the Court
of First Instance.chanroblesvirtualawlibrary chanrobles virtual law library
But after all has been said and done, in justice to the accused, we believe that, whether we
are dealing with a simpleton or an eccentric, or we have here one of those well-nigh
inexplicable phenomena in human conduct where the judge finds himself at a loss to
discover an adequate motivation for the proven acts of the accused, - indulging all Esperanza testified as follows:
reasonable intendments in favor of appellant, we are of opinion that when he committed
"ATTY. ALCANTARA:
the crime charged against him he must have been suffering from some illness (of the body,
the mind, the nerves, or the moral faculty) as is contemplated in paragraph 9 of article 13 We are calling Mrs. Esperanza Alvarez, the wife of the accused, Your Honor.
of the Revised Penal Code as a mitigating circumstance, namely, "such illness of the
offender as would diminish the exercise of the will-power of the offender without COURT:
however depriving him of consciousness of his acts."chanrobles virtual law library Swear in the witness.
Article 246 of the Revised Penal Code punishes parricide by the penalty of reclusion xxx
perpetua to death. Article 63, paragraph 3, of the same code, provides that when the
commission of the act is attended by some mitigating circumstance and there is no ATTY. MESIAH: (sic)
aggravating circumstance, and the law prescribes a penalty composed of two indivisible
Your Honor, we are offering the testimony of this witness for the purpose of proving that
penalties, the lesser penalty shall be applied; in this case, in view of the above indicated
the accused Maximo Alvarez committed all the elements of the crime being charged
circumstance and there being no aggravating circumstance, the lesser penalty is reclusion
particularly that accused Maximo Alvarez pour on May 29, 1998 gasoline in the house
perpetua, which was the penalty correctly applied by the trial court, which penalty, of
located at Blk. 5, Lot 9, Phase 1-C, Dagat-dagatan, Navotas, Metro Manila, the house owned
course, carries with it the accessory penalties provided for in article 41 of the said Code.
by his sister-in-law Susan Ramirez; that accused Maximo Alvarez after pouring the
The accused should also be sentenced to indemnify the heirs of the deceased Romeo
gasoline on the door of the house of Susan Ramirez ignited and set it on fire; that the
Francisco in the sum of P2,000, and to pay the costs.chanroblesvirtualawlibrary
accused at the time he successfully set the house on fire (sic) of Susan Ramirez knew that
chanrobles virtual law library
it was occupied by Susan Ramirez, the members of the family as well as Esperanza
As above modified, the appealed judgment is affirmed, with costs against appellant. So Alvarez, the estranged wife of the accused; that as a consequence of the accused in
ordered. successfully setting the fire to the house of Susan Ramirez, the door of said house was
burned and together with several articles of the house, including shoes, chairs and others.
COURT:
ALVAREZ VS RAMIREZ
You may proceed.
SANDOVAL-GUTIERREZ, J.:
xxx
Before us is a Petition for Review on Certiorari 1 assailing the Decision2 of the Court of
Appeals dated May 31, 2000 in CA-G.R. SP No. 56154, entitled "Susan Ramirez, Petitioner, DIRECT EXAMINATION
versus, Hon. Benjamin M. Aquino, Jr., as Judge RTC, Malabon, MM, Br. 72, and Maximo
ATTY. ALCANTARA:
Alvarez, Respondents."
xxx
Susan Ramirez, herein respondent, is the complaining witness in Criminal Case No.
19933-MN for arson3 pending before the Regional Trial Court, Branch 72, Malabon City. Q: When you were able to find the source, incidentally what was the source of that
The accused is Maximo Alvarez, herein petitioner. He is the husband of Esperanza G. scent?cralawlibrary
Alvarez, sister of respondent.
A: When I stand by the window, sir, I saw a man pouring the gasoline in the house of my
On June 21, 1999, the private prosecutor called Esperanza Alvarez to the witness stand sister (and witness pointing to the person of the accused inside the court room).
as the first witness against petitioner, her husband. Petitioner and his counsel raised no
objection.
Q: For the record, Mrs. Witness, can you state the name of that person, if you
know?cralawlibrary
A: He is my husband, sir, Maximo Alvarez.
Q: If that Maximo Alvarez you were able to see, can you identify him?cralawlibrary
A: Yes, sir.
Q: If you can see him inside the Court room, can you please point him?cralawlibrary
A: Witness pointing to a person and when asked to stand and asked his name, he gave his
name as Maximo Alvarez."4
In the course of Esperanza's direct testimony against petitioner, the latter showed
"uncontrolled emotions," prompting the trial judge to suspend the proceedings.
On June 30, 1999, petitioner, through counsel, filed a motion5 to disqualify Esperanza
from testifying against him pursuant to Rule 130 of the Revised Rules of Court on marital
disqualification.
Respondent filed an opposition6 to the motion. Pending resolution of the motion, the trial
court directed the prosecution to proceed with the presentation of the other witnesses.
On September 2, 1999, the trial court issued the questioned Order disqualifying
Esperanza Alvarez from further testifying and deleting her testimony from the records.7
The prosecution filed a motion for reconsideration but was denied in the other assailed
Order dated October 19, 1999.8
This prompted respondent Susan Ramirez, the complaining witness in Criminal Case No.
19933-MN, to file with the Court of Appeals a Petition for Certiorari9 with application for
preliminary injunction and temporary restraining order.10
On May 31, 2000, the Appellate Court rendered a Decision nullifying and setting aside the
assailed Orders issued by the trial court.
Hence, this Petition for Review on Certiorari .
The issue for our resolution is whether Esperanza Alvarez can testify against her husband
in Criminal Case No. 19933-MN.
Section 22, Rule 130 of the Revised Rules of Court provides:
"Sec. 22. Disqualification by reason of marriage. 'During their marriage, neither the
husband nor the wife may testify for or against the other without the consent of the
affected spouse, except in a civil case by one against the other, or in a criminal case for a
crime committed by one against the other or the latter's direct descendants or
ascendants."
The reasons given for the rule 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;
andcralawlibrary
4. Where there is want of domestic tranquility there is danger of punishing one spouse
through the hostile testimony of the other.11
But like all other general rules, the marital disqualification rule has its own exceptions,
both in civil actions between the spouses and in criminal cases for offenses committed by
one against the other. Like the rule itself, the exceptions are backed by sound reasons
which, in the excepted cases, outweigh those in support of the general rule. For instance,
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.12
In Ordoño v. Daquigan,13 this Court held:
"We think that the correct rule, which may be adopted in this jurisdiction, is that laid
down in Cargil v. State, 35 ALR 133, 220 Pac. 64, 25 Okl. 314, wherein the court said:
'The rule that the injury must amount to a physical wrong upon the person is too narrow;
and the rule that any offense 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.
As correctly observed by the Court of Appeals:
US VS ANTIPOLO
"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 G.R. No. L-13109 March 6, 1918
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 THE UNITED STATES, plaintiff-appellee,
complained of had the effect of directly and vitally impairing the conjugal relation. It vs.
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 DALMACEO ANTIPOLO, defendant-appellant.
tranquility to be preserved. The Supreme Court has held that in such a case, identity is
Irureta Goyena and Recto for appellant.
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 Acting Attorney-General Paredes for appellee.
void in the unhappy home. (People v. Castañeda, 271 SCRA 504). Thus, there is no longer
FISHER, J.:
any reason to apply the Marital Disqualification Rule."
The appellant was prosecuted in the Court of First Instance of the Province of Batangas,
It should be stressed that as shown by the records, prior to the commission of the offense,
charged with the murder of one Fortunato Dinal. The trial court convicted him of
the relationship between petitioner and his wife was already strained. In fact, they were
homicide and from that decision he was appealed. One of the errors assigned is based
separated de facto almost six months before the incident. Indeed, the evidence and facts
upon the refusal of the trial judge to permit Susana Ezpeleta, the widow of the man whom
presented reveal that the preservation of the marriage between petitioner and Esperanza
the appellant is accused of having murdered, to testify as a witness on behalf of the
is no longer an interest the State aims to protect.
defense concerning certain alleged dying declarations. The witness was called to the
At this point, it bears emphasis that the State, being interested in laying the truth before stand and having stated that she is the widow of Fortunato Dinal was asked: "On what
the courts so that the guilty may be punished and the innocent exonerated, must have the occasion did your husband die?" To this question the fiscal objected upon the following
right to offer the direct testimony of Esperanza, even against the objection of the accused, ground:
because (as stated by this Court in Francisco14), "it was the latter himself who gave rise to
I object to the testimony of this witness. She has just testified that she is the widow of the
its necessity."
deceased, Fortunato Dinal, and that being so I believe that she is not competent to testify
WHEREFORE, the Decision of the Court of Appeals is AFFIRMED. The trial court, RTC, under the rules and procedure in either civil or criminal cases, unless it be with the
Branch 72, Malabon City, is ordered to allow Esperanza Alvarez to testify against consent of her husband, and as he is dead and cannot grant that permission, it follows
petitioner, her husband, in Criminal Case No. 19933-MN. Costs against petitioner. that this witness is disqualified from testifying in this case in which her husband is the
injured party.
SO ORDERED.
Counsel for defendant insisted that the witness was competent, arguing that the
disqualification which the fiscal evidently had in mind relates only to cases in which a
husband or wife of one of the parties to a proceeding is called to testify; 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 therefore not subject to any disqualification
arising from the status of marriage.
These propositions were rejected by the trial judge, and the objection of the fiscal as to
the testimony of the woman Ezpeleta was 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.
Section 58 of General Orders No. 58 (1900) reads as follows:
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.
The reasons for this rule are thus stated in Underhill's work on Criminal Evidence (second
edition) on page 346:
At common law, neither a husband nor a wife was a competent witness for or against the
other in any judicial proceedings, civil or criminal, to which the other was a party. . . . If
either were recognized as a competent witness against the other who was accused of
crime, . . . a very serious injury would be done to the harmony and happiness of husband
and wife and the confidence which should exist between them.
In Greenleaf's classical work on evidence, in section 337 [vol. I], the author says, in stating
the reasons for the rule at common law:
The great object of the rule is to secure domestic happiness by placing the protecting seal
of the law upon all confidential communications between husband and wife; and
whatever has come to the knowledge of either by means of the hallowed confidence
which that relation inspires, cannot be afterwards divulged in testimony even though the
other party be no longer living.
This case does not fall with the text of the statute or the reason upon which it is based.
The purpose of section 58 is to protect 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. 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 same theory as that upon which section 58 of General Orders No. 58 is based,
underlies section 383, paragraph 3 of Act No. 190, which reads as follows:
A husband cannot be examined for or against his wife without her consent; nor a wife for
or against her husband without his consent; nor can either, during the marriage or
afterwards, be, without the consent of the other, examined as to any communication made
by one to the other during the marriage; but this exception does not apply to a civil action
or proceeding by one against the other, or to a criminal action or proceeding for a crime
committed by one against the other.
The only doubt which can arise from a reading of this provision relates to the meaning of
the words "during the marriage or afterwards," and this doubt can arise only by a
consideration of this phrase separately from the rest of the paragraph. Construed as a
whole it is evident that it relates only to cases in which the testimony of a spouse is offered
for or against the other in a proceeding to which the other is a party. The use of the word
"afterwards" in the phrase "during the marriage or afterwards" was intended to cover
cases in which a marriage has been dissolved otherwise than by death of one of the
spouses — as, for instance, by decree of annulment or divorce.
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., Rep., 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. In the case
of the State vs. Ryan (30 La. Ann., 1176), cited by appellant in his brief, the court said:
The next bill is as to the competency of the widow of the deceased to prove his dying
declarations. We see no possible reason for excluding her . . . after the husband's death
she is no longer his wife, and the rules of evidence, as between husbands and wives, are
no longer applicable.
In the case of Arnett vs. Commonwealth (114 Ky., 593, 596), the testimony of the widow
of the deceased as to his dying declarations made to her was objected to upon the express
ground that under the terms of the Kentucky Code, "the wife was incompetent to testify
even after the cessation of the marriage relation, to any communication made by her by
her husband during the marriage."
This contention was rejected, the court saying:
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. . . . 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.
We are therefore of the opinion that the court below erred in excluding the testimony of
the witness Susana Ezpeleta, and that by reason of such exclusion, the accused was
deprived of one of his essential rights. That being the case, a new trial must be granted.
For the reason stated, the 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,
together with any additional evidence which may be offered on the part of the
prosecution or the defense. At the new trial granted the accused, the testimony taken at
the former hearing shall be considered. The costs of this appeal shall be de officio. So
ordered.
PEOPLE VS CARLOS
This is an appeal from a decision of the Court of First Instance of the City of Manila
finding the defendant Fausto V. Carlos guilty of the crime of murder and sentencing him
to suffer life imprisonment, with the accessory penalties prescribed by law and with the
costs.chanroblesvirtualawlibrary chanrobles virtual law library
It appears from the evidence that the victim of the alleged murder, Dr. Pablo G. Sityar,
on March 3, 1924, in Mary Chiles Hospital, performed a surgical operation upon the
defendant's wife for appendicitis and certain other ailments. She remained in the
hospital until the 18th of the same month, but after her release therefrom she was
required to go several times to the clinic of Doctor Sityar at No. 40 Escolta, for the
purpose of dressing the wounds caused by the operation. On these occasions she was
accompanied by her husband, the defendant. The defendant states that on one of the
visits, that of March 20, 1924, Doctor Sityar sent him out on an errand to buy some
medicine, and that while defendant was absent on this errand Doctor Sityar outraged
the wife. The defendant further states that his wife informed him of the outrage shortly
after leaving the clinic. Notwithstanding this it nevertheless appears that he again went
there on March 28th to consult the deceased about some lung trouble from which he,
the defendant, was suffering.. He was given some medical treatment and appears to
have made at least one more visit to the clinic without revealing any special
resentment.chanroblesvirtualawlibrary chanrobles virtual law library
On May 12, 1924, the defendant, suffering from some stomach trouble, entered the
Philippine General Hospital where he remained until May 18, 1924, and where he was
under the care of two other physicians. While in the hospital her received a letter
(Exhibit 5) from Doctor Sityar asking the immediate settlement of the account for the
professional services rendered his wife. Shortly after his release from the hospital the
defendant sought an interview with Doctor Sityar and went to the latter's office several
times without finding him in. On one of these occasions he was asked by an employee of
the office, the nurse Caba�era, if he had come to settle his account, to which the
defendant answered that he did not believe he owed the doctor
anything.chanroblesvirtualawlibrary chanrobles virtual law library
In the afternoon of May 26th the defendant again went to the office of the deceased and
found him there alone. According to the evidence of the prosecution, the defendant then,
without any preliminary quarrel between the two, attacked the deceased with a fan-
knife and stabbed him twice. The deceased made an effort to escape but the defendant
pursued him and overtaking him in the hall outside the office, inflicted another wound
upon him and as a consequence if the three wounds he died within a few minutes. The
defendants made his escape but surrendered himself to the Constabulary at Malolos,
Bulacan, in the evening of the following day.chanroblesvirtualawlibrary chanrobles
virtual law library
The defendant admits that he killed the deceased but maintains that he did so in self-
defense. He explains that he went to Doctor Sityar's office to protest against the amount
of the fee charged by the doctor and, in any event, to ask for an extension of the time of
payment; that during the conversation upon that subject the deceased insulted him by
telling him that inasmuch as he could not pay the amount demanded he could send his
wife to the office as she was the one treated, and that she could then talk the matter
over with the decease; that this statement was made in such an insolent and
contemptuous manner that the defendant became greatly incensed and remembering
the outrage committed upon his wife, he assumed a threatening attitude and challenged
the deceased to go downstairs with him and there settle the matter; that the deceased
thereupon took a pocket-knife from the center drawer of his desk and attacked the
defendant, endeavoring to force him out of the office; that the defendant, making use of
his knowledge of fencing, succeeded in taking the knife away from the deceased and
blinded by fury stabbed him first in the right side of the breast and then in the epigastric
region, and fearing that the deceased might secure some other weapon or receive
assistance from the people in the adjoining room, he again stabbed him, this time in the
back.chanroblesvirtualawlibrary chanrobles virtual law library
The defendant's testimony as to the struggle described is in conflict with the evidence
presented by the prosecution. But assuming that it is true, it is very evident that it fails
to establish a case of self-defense and that, in reality, the only question here to be
determined is whether the defendant is guilty of murder or of simple
homicide.chanroblesvirtualawlibrary chanrobles virtual law library
The court below found that the crime was committed with premeditation and therefore
constituted murder. This finding can only be sustained by taking into consideration
Exhibit L, a letter written to the defendant by his wife and siezed by the police in searching
his effects on the day of his arrest. It is dated May 25, 1924, two days before the
commission of the crime and shows that the writer feared that the defendant
contemplated resorting to physical violence in dealing with the
deceased.chanroblesvirtualawlibrary chanrobles virtual law library
Counsel for the defendant argues vigorously that the letter was a privileged
communication and therefore not admissible in evidence. The numerical weight of
authority is, however, to the effect that 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. (28 R.C.L., 530 and authorities there cited.) Such is the view of the majority of
this court.chanroblesvirtualawlibrary chanrobles virtual law library
Professor Wigmore states the rule as follows:
For documents of communication coming into the possession of a third person, a
distinction should obtain, analogous to that already indicated for a client's
communications ( ante, par. 2325, 2326); i. e., if they were obtained from the addressee
by voluntary delivery, they should still be privileged (for otherwise the privilege could by
collusion be practically nullified for written communications); but if they were obtained
surreptitiously or otherwise without the addressee's consent, the privilege should cease.
(5 Wigmore on Evidence, 2nd ed., par. 2339.)
The letter in question was obtained through a search for which no warrant appears to
have been issued and counsel for the defendant cites the causes of Boyd and Boyd vs.
United States (116 U.S., 616) and Silverthorne Lumber Co. and Silverthorne vs. United
States (251 U.S., 385) as authority for the proposition that documents obtained by illegal
searches of the defendant's effects are not admissible in evidence in a criminal case. In
discussing this point we can do not better than to quote Professor Wigmore:
The foregoing doctrine ( i. e., that the admissibility of evidence is not affected by the
illegality of the means through which the party has been enabled to obtain the evidence)
was never doubted until the appearance of the ill-starred majority opinion of Boyd vs.
United States, in 1885, which has exercised unhealthy influence upon subsequent judicial
opinion in many States.
xxx xxx x x xchanrobles virtual law library
The progress of this doctrine of Boyd vs. United States was as follows: ( a) The Boyd Case
remained unquestioned in its own Court for twenty years; meantime receiving frequent
disfavor in the State Courts ( ante, par. 2183). ( b) Then in Adams vs. New York, in 1904,
it was virtually repudiated in the Federal Supreme Court, and the orthodox precedents
recorded in the State courts ( ante, par. 2183) were expressly approved. ( c) Next, after
another twenty years, in 1914 - moved this time, not by erroneous history, but by
misplaced sentimentality - the Federal Supreme Court, in Weeks vs. United States,
reverted to the original doctrine of the Boyd Case, but with a condition, viz., that the
illegality of the search and seizure should first have been directly litigated and established
by a motion, made before trial, for the return of the things seized; so that, after such a
motion, and then only, the illegality would be noticed in the main trial and the evidence
thus obtained would be excluded. ... (4 Wigmore on Evidence, 2nd ed., par. 2184.)
In the Silverthorne Lumber Co. case the United States Supreme Court adhered to its
decision in the Weeks Case. The doctrine laid down in these cases has been followed by
some of the State courts but has been severely criticized and does not appear to have been
generally accepted. But assuming, without deciding, that it prevails in this jurisdiction it
is, nevertheless, under the decisions in the Weeks and Silverthorne cases, inapplicable to
the present case. Here the illegality of the search and seizure was not "directly litigated
and established by a motion, made before trial, for the return of the things
seized."chanrobles virtual law library
The letter Exhibit L must, however, be excluded for reasons not discussed in the briefs.
The letter was written by the wife of the defendant and if she had testified at the trial the
letter might have been admissible to impeach her testimony, but she was not put on the
witness-stand and the letter was therefore not offered for that purpose. If the defendant
either by answer or otherwise had indicated his assent to the statements contained in the
letter it might also have been admissible, but such is not the case here; the fact that he
had the letter in his possession is no indication of acquiescence or assent on his part. The
letter is therefore nothing but pure hearsay and its admission in evidence violates the
constitutional right of the defendant in a criminal case to be confronted with the
witnesses for the prosecution and have the opportunity to cross-examine them. In this
respect there can be no difference between an ordinary communication and one
originally privileged.chanroblesvirtualawlibrary chanrobles virtual law library
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.
Testimony of that character is admissible on the ground that 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. That cannot apply where the statement is contained in an
unanswered letter.chanroblesvirtualawlibrary chanrobles virtual law library
The Attorney-General in support of the contrary view quotes Wigmore, as follows:
. . . Express communication is always a proper mode of evidencing knowledge or belief.
Communication to a husband or wife is always receivable to show probable knowledge
by the other (except where they are living apart or are not in good terms), because, while
it is not certain that the one will tell the other, and while the probability is less upon some
subjects than upon others, still there is always some probability, - which is all that can be
fairly asked for admissibility. ... (1 Wigmore, id., par. 261.)
This may possibly be good law, though Wigmore cites no authority in support of his
assertion, but as far as we can see it has little or nothing to do with the present
case.chanroblesvirtualawlibrary chanrobles virtual law library
As we have already intimated, if Exhibit L is excluded, there is in our opinion not sufficient
evidence in the record to show that the crime was
premeditated.chanroblesvirtualawlibrary chanrobles virtual law library
The prosecution maintains that the crime was committed with alevosia. This contention
is based principally on the fact that one of the wounds received by the deceased showed
a downward direction indicating that the deceased was sitting down when the wound
was inflicted. We do not think this fact is sufficient proof. The direction of the wound
would depend largely upon the manner in which the knife was
held.chanroblesvirtualawlibrary chanrobles virtual law library
For the reasons stated we find the defendant guilty of simple homicide, without
aggravating or extenuating circumstances.chanroblesvirtualawlibrary chanrobles virtual
law library
The sentence appealed from is therefore modified by reducing the penalty to fourteen
years, eight months and one day of reclusion temporal, with the corresponding accessory
penalties and with the costs against the appellant. So ordered.
Johnson, Malcolm, Johns, and Romualdez, JJ., concur
BARTON VS LEYTE ASPHALT
This action was instituted in the Court of First Instance of the City of Manila by James D.
Barton, to recover of the Leyte Asphalt & Mineral Oil Co., Ltd., as damages for breach of
contract, the sum of $318,563.30, United States currency, and further to secure a judicial
pronouncement to the effect that the plaintiff is entitled to an extension of the terms of
the sales agencies specified in the contract Exhibit A. The defendant answered with a
general denial, and the cause was heard upon the proof, both documentary and oral, after
which the trial judge entered a judgment absolving the defendant corporation from four
of the six causes of action set forth in the complaint and giving judgment for the plaintiff
to recover of said defendant, upon the first and fourth causes of action, the sum of
$202,500, United States currency, equivalent to $405,000, Philippine currency, with legal
interest from June 2, 1921, and with costs. From this judgment the defendant company
appealed.chanroblesvirtualawlibrary chanrobles virtual law library
The plaintiff is a citizen of the United States, resident in the City of Manila, while the
defendant is a corporation organized under the law of the Philippine Islands with its
principal office in the City of Cebu, Province of Cebu, Philippine Islands. Said company
appears to be the owner by a valuable deposit of bituminous limestone and other asphalt
products, located on the Island of Leyte and known as the Lucio mine. On April 21, 1920,
one William Anderson, as president and general manager of the defendant company,
addressed a letter Exhibit B, to the plaintiff Barton, authorizing the latter to sell the
products of the Lucio mine in the Commonwealth of Australia and New Zealand upon a
scale of prices indicated in said letter.chanroblesvirtualawlibrary chanrobles virtual law
library
In the third cause of action stated in the complaint the plaintiff alleges that during the life
of the agency indicated in Exhibit B, he rendered services to the defendant company in
the way of advertising and demonstrating the products of the defendant and expended
large sums of money in visiting various parts of the world for the purpose of carrying on
said advertising and demonstrations, in shipping to various parts of the world samples of
the products of the defendant, and in otherwise carrying on advertising work. For these
services and expenditures the plaintiff sought, in said third cause of action, to recover the
sum of $16,563.80, United States currency. The court, however, absolved the defendant
from all liability on this cause of action and the plaintiff did not appeal, with the result
that we are not now concerned with this phase of the case. Besides, the authority
contained in said Exhibit B was admittedly superseded by the authority expressed in a
later letter, Exhibit A, dated October 1, 1920. This document bears the approval of the
board of directors of the defendant company and was formally accepted by the plaintiff.
As it supplies the principal basis of the action, it will be quoted in its entirety.
(Exhibit A)
CEBU, CEBU, P. I.
October 1, 1920.
JAMES D. BARTON, Esq.,
Cebu Hotel City. chanrobles virtual law library
DEAR SIR: - You are hereby given the sole and exclusive sales agency for our bituminous
limestone and other asphalt products of the Leyte Asphalt and Mineral Oil Company, Ltd.,
May first, 1922, in the following territory:
Australia
Saigon
Java
New Zealand
India
China
Tasmania
Sumatra
Hongkong
Siam and the Straits Settlements, also in the United States of America until May 1,
1921.chanroblesvirtualawlibrary chanrobles virtual law library
As regard bituminous limestone mined from the Lucio property. No orders for less than
one thousand (1,000) tons will be accepted except under special agreement with us. All
orders for said products are to be billed to you as follows:
Per ton
In 1,000 ton lots ...........................................
P15
In 2,000 ton lots ...........................................
14
In 5,000 ton lots ...........................................
12
In 10,000 ton lots ..........................................
10
with the understanding, however that, should the sales in the above territory equal or
exceed ten thousand (10,000) tons in the year ending October 1, 1921, then in that event
the price of all shipments made during the above period shall be ten pesos (P10) per ton,
and any sum charged to any of your customers or buyers in the aforesaid territory in
excess of ten pesos (P10) per ton, shall be rebated to you. Said rebate to be due and
payable when the gross sales have equalled or exceeded ten thousand (10,000) tons in
the twelve months period as hereinbefore described. Rebates on lesser sales to apply as
per above price list.chanroblesvirtualawlibrary chanrobles virtual law library
You are to have full authority to sell said product of the Lucio mine for any sum see fit in The products of the other mines can be sold by you in the aforesaid territories under the
excess of the prices quoted above and such excess in price shall be your extra and same terms and conditions as the products of the Lucio mine; scale of prices to be
additional profit and commission. Should we make any collection in excess of the prices mutually agreed upon between us.
quoted, we agree to remit same to your within ten (10) days of the date of such collections
LEYTE ASPHALT & MINERAL OIL CO., LTD.
or payments.chanroblesvirtualawlibrary chanrobles virtual law library
By (Sgd.) WM. ANDERSON
All contracts taken with municipal governments will be subject to inspector before
shipping, by any authorized representative of such governments at whatever price may President
be contracted for by you and we agree to accept such contracts subject to draft attached
to bill of lading in full payment of such shipment.chanroblesvirtualawlibrary chanrobles (Sgd.) W. C. A. PALMER
virtual law library Secretary
It is understood that the purchasers of the products of the Lucio mine are to pay freight Approved by Board of Directors,
from the mine carriers to destination and are to be responsible for all freight, insurance
and other charges, providing said shipment has been accepted by their October 1, 1920.
inspectors.chanroblesvirtualawlibrary chanrobles virtual law library
(Sgd.) WM. ANDERSON
All contracts taken with responsible firms are to be under the same conditions as with
President
municipal governments.chanroblesvirtualawlibrary chanrobles virtual law library
Accepted.
All contracts will be subject to delays caused by the acts of God, over which the parties
hereto have no control.chanroblesvirtualawlibrary chanrobles virtual law library (Sgd.) JAMES D. BARTON
It is understood and agreed that we agree to load all ships, steamers, boats or other Witness D. G. MCVEAN
carriers prompty and without delay and load not less than 1,000 tons each twenty-four
Upon careful perusal of the fourth paragraph from the end of this letter it is apparent that
hours after March 1, 1921, unless we so notify you specifically prior to that date we are
some negative word has been inadvertently omitted before "prepared," so that the full
prepared to load at that rate, and it is also stipulated that we shall not be required to ship
expression should be "unless we should notify you specifically prior to that date that we
orders of 5,000 tons except on 30 days notice and 10,000 tons except on 60 days
are unprepared to load at that rate," or "not prepared to load at that rate." chanrobles
notice.chanroblesvirtualawlibrary chanrobles virtual law library
virtual law library
If your sales in the United States reach five thousand tons on or before May 1, 1921, you
are to have sole rights for this territory also for one year additional and should your sales Very soon after the aforesaid contract became effective, the plaintiff requested the
defendant company to give him a similar selling agency for Japan. To this request the
in the second year reach or exceed ten thousand tons you are to have the option to renew
the agreement for this territory on the same terms for an additional two defendant company, through its president, Wm. Anderson, replied, under date of
November 27, 1920, as follows:
years.chanroblesvirtualawlibrary chanrobles virtual law library
In re your request for Japanese agency, will say, that we are willing to give you, the same
Should your sales equal exceed ten thousand (10,000) tons in the year ending October 1,
commission on all sales made by you in Japan, on the same basis as your Australian sales,
1921, or twenty thousand (20,000) tons by May 1, 1922, then this contract is to be
but we do not feel like giving you a regular agency for Japan until you can make some
continued automatically for an additional three years ending April 30, 1925, under the
large sized sales there, because some other people have given us assurances that they can
same terms and conditions as above stipulated.chanroblesvirtualawlibrary chanrobles
handle our Japanese sales, therefore we have decided to leave this agency open for a time.
virtual law library
Meanwhile the plaintiff had embarked for San Francisco and upon arriving at that port he
entered into an agreement with Ludvigsen & McCurdy, of that city, whereby said firm was
constituted a subagent and given the sole selling rights for the bituminous limestone
products of the defendant company for the period of one year from November 11, 1920,
on terms stated in the letter Exhibit K. The territory assigned to Ludvigsen & McCurdy
included San Francisco and all territory in California north of said city. Upon an earlier
voyage during the same year to Australia, the plaintiff had already made an agreement
with Frank B. Smith, of Sydney, whereby the latter was to act as the plaintiff's sales agent
for bituminous limestone mined at the defendant's quarry in Leyte, until February 12,
1921. Later the same agreement was extended for the period of one year from January 1,
1921. (Exhibit Q.) chanrobles virtual law library
On February 5, 1921, Ludvigsen & McCurdy, of San Francisco, addressed a letter to the
plaintiff, then in San Francisco, advising hi that he might enter an order for six thousand
tons of bituminous limestone to be loaded at Leyte not later than May 5, 1921, upon terms
stated in the letter Exhibit G. Upon this letter the plaintiff immediately indorsed his
acceptance.chanroblesvirtualawlibrary chanrobles virtual law library
The plaintiff then returned to Manila; and on March 2, 1921, Anderson wrote to him from
Cebu, to the effect that the company was behind with construction and was not then able
to handle big contracts. (Exhibit FF.) On March 12, Anderson was in Manila and the two
had an interview in the Manila Hotel, in the course of which the plaintiff informed
Anderson of the San Francisco order. Anderson thereupon said that, owing to lack of
capital, adequate facilities had not been provided by the company for filling large orders
and suggested that the plaintiff had better hold up in the matter of taking orders. The
plaintiff expressed surprise at this and told Anderson that he had not only the San
Francisco order (which he says he exhibited to Anderson) but other orders for large
quantities of bituminous limestone to be shipped to Australia and Shanghai. In another
interview on the same Anderson definitely informed the plaintiff that the contracts which
be claimed to have procured would not be filled.chanroblesvirtualawlibrary chanrobles
virtual law library
Three days later the plaintiff addressed a letter (Exhibit Y) to the defendant company in
Cebu, in which he notified the company to be prepared to ship five thousand tons of
bituminous limestone to John Chapman Co., San Francisco, loading to commence on May
1, and to proceed at the rate of one thousand tons per day of each twenty-four hours,
weather permitting.chanroblesvirtualawlibrary chanrobles virtual law library
On March 5, 1921, Frank B. Smith, of Sydney, had cabled the plaintiff an order for five
thousand tons of bituminous limestone; and in his letter of March 15 to the defendant,
the plaintiff advised the defendant company to be prepared to ship another five thousand
tons of bituminous limestone, on or about May 6, 1921, in addition to the intended
consignment for San Francisco. The name Henry E. White was indicated as the name of
the person through whom this contract had been made, and it was stated that the
consignee would be named later, no destination for the shipment being given. The
plaintiff explains that the name White, as used in this letter, was based on an inference
which he had erroneously drawn from the cable sent by Frank B. Smith, and his intention
was to have the second shipment consigned to Australia in response to Smith's
order.chanroblesvirtualawlibrary chanrobles virtual law library
It will be noted in connection with this letter of the plaintiff, of March 15, 1921, that no
mention was made of the names of the person, or firm, for whom the shipments were
really intended. The obvious explanation that occurs in connection with this is that the
plaintiff did not then care to reveal the fact that the two orders had originated from his
own subagents in San Francisco and Sydney.chanroblesvirtualawlibrary chanrobles
virtual law library
To the plaintiff's letter of March 15, the assistant manager of the defendant company
replied on March, 25, 1921, acknowledging the receipt of an order for five thousand tons
of bituminous limestone to be consigned to John Chapman Co., of San Francisco, and the
further amount of five thousand tons of the same material to be consigned to Henry E.
White, and it was stated that "no orders can be entertained unless cash has been actually
deposited with either the International Banking Corporation or the Chartered Bank of
India, Australia and China, Cebu." (Exhibit Z.) chanrobles virtual law library
To this letter the plaintiff in turn replied from Manila, under date of March, 1921,
questioning the right of the defendant to insist upon a cash deposit in Cebu prior to the
filling of the orders. In conclusion the plaintiff gave orders for shipment to Australia of
five thousand tons, or more, about May 22, 1921, and ten thousand tons, or more, about
June 1, 1921. In conclusion the plaintiff said "I have arranged for deposits to be made on
these additional shipments if you will signify your ability to fulfill these orders on the
dates mentioned." No name was mentioned as the purchaser, or purchases, of these
intended Australian consignments.chanroblesvirtualawlibrary chanrobles virtual law
library
Soon after writing the letter last above-mentioned, the plaintiff embarked for China and
Japan. With his activities in China we are not here concerned, but we note that in Tokio,
Japan, he came in contact with one H. Hiwatari, who appears to have been a suitable
person for handling bituminous limestone for construction work in Japan. In the letter
Exhibit X, Hiwatari speaks of himself as if he had been appointed exclusive sales agent for
the plaintiff in Japan, but no document expressly appointing him such is in It will be noted that the only written communications between the plaintiff and the
evidence.chanroblesvirtualawlibrary chanrobles virtual law library defendant company in which the former gave notice of having any orders for the sale of
bituminous limestone are the four letters Exhibit Y, AA, BB, and II. In the first of these
While the plaintiff was in Tokio he procured the letter Exhibit W, addressed to himself, to
letters, dated March 15, 1921, the plaintiff advises the defendant company to be prepared
be signed by Hiwatari. This letter, endited by the plaintiff himself, contains an order for
to ship five thousand tons of bituminous limestone, to be consigned to John Chapman, Co.,
one thousand tons of bituminous limestone from the quarries of the defendant company,
of San Francisco, to be loaded by March 5, and a further consignment of five thousand
to be delivered as soon after July 1, 1921, as possible. In this letter Hiwatari states, "on
tons, through a contract with Henry E. White, consignees to be named later. In the letter
receipt of the cable from you, notifying me of date you will be ready to ship, and also
Exhibit BB dated May 17, 1921, the plaintiff's attorney gives notice of the acceptance by
tonnage rate, I will agree to transfer through the Bank of Taiwan, of Tokio, to the Asia
plaintiff of an order from Hiwatari, of Tokio, approved by the Bank of Taiwan, for a
Banking Corporation, of Manila, P. I., the entire payment of $16,000 gold, to be subject to
minimum of ten thousand annually for a period of five years, first shipment of a thousand
our order on delivery of documents covering bill of lading of shipments, the customs
tons to be as early after July 1 as possible. In the letter Exhibit H the plaintiff gives notice
report of weight, and prepaid export tax receipt. I will arrange in advance a confirmed or
of an "additional" (?) order from H. E. White, Sydney, for two lots of bituminous limestone
irrevocable letter of credit for the above amounts so that payment can be ordered by
of five thousand tons each, one for shipment not later than June 30, 1921, and the other
cable, in reply to your cable advising shipping date." chanrobles virtual law library
by July 20, 1921. In the same letter thousand tons from F. B. Smith, to be shipped to
In a letter, Exhibit X, of May 16, 1921, Hiwatari informs the plaintiff that he had shown Brisbane, Australia, by June 30, and a similar amount within thirty days
the contract, signed by himself, to the submanager of the Taiwan Bank who had given it later.chanroblesvirtualawlibrary chanrobles virtual law library
as his opinion that he would be able to issue, upon request of Hiwatari, a credit note for
After the suit was brought, the plaintiff filed an amendment to his complaint in which he
the contracted amount, but he added that the submanager was not personally able to
set out, in tabulated form, the orders which he claims to have received and upon which
place his approval on the contract as that was a matter beyond his authority. Accordingly
his letters of notification to the defendant company were based. In this amended answer
Hiwatari advised that he was intending to make further arrangements when the manager
the name of Ludvigsen & McCurdy appears for the first time; and the name of Frank B.
of the bank should return from Formosa.chanroblesvirtualawlibrary chanrobles virtual
Smith, of Sydney, is used for the first time as the source of the intended consignments of
law library
the letters, Exhibits G, L, M, and W, containing the orders from Ludvigen & McCurdy,
In the letter of May 5, 1921, containing Hiwatari's order for one thousand tons of Frank B. Smith and H. Hiwatari were at no time submitted for inspection to any officer of
bituminous limestone, it was stated that if the material should prove satisfactory after the defendant company, except possibly the Exhibit G, which the plaintiff claims to have
being thoroughly tested by the Paving Department of the City of Tokio, he would contract shown to Anderson in Manila on March, 12, 1921.chanroblesvirtualawlibrary chanrobles
with the plaintiff for a minimum quantity of ten thousand additional tons, to be used virtual law library
within a year from September 1, 1921, and that in this event the contract was to be
The different items conspiring the award which the trial judge gave in favor of the plaintiff
automatically extended for an additional four years. The contents of the letter of May 5
are all based upon the orders given by Ludvigsen & McCurdy (Exhibit G), by Frank B.
seems to have been conveyed, though imperfectly, by the plaintiff to his attorney, Mr.
Smith (Exhibit L and M), and by Hiwatari in Exhibit W; and the appealed does not involve
Frank B. Ingersoll, of Manila; and on May 17, 1921, Ingersoll addressed a note to the
an order which came from Shanghai, China. We therefore now address ourselves to the
defendant company in Cebu in which he stated that he had been requested by the plaintiff
question whether or not the orders contained in Exhibit G, L, M, and W, in connection with
to notify the defendant that the plaintiff had accepted an order from Hiwatari, of Tokio,
the subsequent notification thereof given by the plaintiff to the defendant, are sufficient
approved by the Bank of Taiwan, for a minimum order of ten thousand tons of the stone
to support the judgment rendered by the trial court.chanroblesvirtualawlibrary
annually for a period of five years, the first shipment of one thousand tons to be made as
chanrobles virtual law library
early after July 1 as possible. It will be noted that this communication did not truly reflect
the contents of Hiwatari's letter, which called unconditionally for only one thousand tons, The transaction indicated in the orders from Ludvigsen, & McCurdy and from Frank B.
the taking of the remainder being contingent upon future Smith must, in our opinion, be at once excluded from consideration as emanating from
eventualities.chanroblesvirtualawlibrary chanrobles virtual law library persons who had been constituted mere agents of the plaintiff. The San Francisco order
and the Australian orders are the same in legal effect as if they were orders signed by the
plaintiff and drawn upon himself; and it cannot be pretended that those orders represent
sales to bona fide purchasers found by the plaintiff. The original contract by which the
plaintiff was appointed sales agent for a limited period of time in Australia and the United
States contemplated that he should find reliable and solvent buyers who should be
prepared to obligate themselves to take the quantity of bituminous limestone contracted
for upon terms consistent with the contract. These conditions were not met by the taking
of these orders from the plaintiff's own subagents, which was as if the plaintiff had bought
for himself the commodity which he was authorized to sell to others. Article 267 of the
Code of Commerce declares that no agent shall purchase for himself or for another that
which he has been ordered to sell. The law has placed its ban upon a broker's purchasing
from his principal unless the latter with full knowledge of all the facts and circumstances
acquiesces in such course; and even then the broker's action must be characterized by
the utmost good faith. A sale made by a broker to himself without the consent of the
principal is ineffectual whether the broker has been guilty of fraudulent conduct or not.
(4 R. C. L., 276-277.) We think, therefore, that the position of the defendant company is
indubitably sound in so far as it rest upon the contention that the plaintiff has not in fact
found any bona fide purchasers ready and able to take the commodity contracted for
upon terms compatible with the contract which is the basis of the
action.chanroblesvirtualawlibrary chanrobles virtual law library
It will be observed that the contract set out at the beginning of this opinion contains
provisions under which the period of the contract might be extended. That privilege was
probably considered a highly important incident of the contract and it will be seen that
the sale of five thousand tons which the plaintiff reported for shipment to San Francisco
was precisely adjusted to the purpose of the extension of the contract for the United
States for the period of an additional year; and the sales reported for shipment to
Australia were likewise adjusted to the requirements for the extention of the contract in
that territory. Given the circumstances surrounding these contracts as they were
reported to the defendant company and the concealment by the plaintiff of the names of
the authors of the orders, -- who after all were merely the plaintiff's subagents, - the
officers of the defendant company might justly have entertained the suspicion that the
real and only person behind those contracts was the plaintiff himself. Such at least turns
out to have been the case.chanroblesvirtualawlibrary chanrobles virtual law library
Much energy has been expended in the briefs upon his appeal over the contention
whether the defendant was justified in laying down the condition mentioned in the letter
of March 26, 1921, to the effect that no order would be entertained unless cash should be
deposited with either the International Banking Corporation of the Chartered Bank of
India, Australia and China, in Cebu. In this connection the plaintiff points to the stipulation
of the contract which provides that contracts with responsible parties are to be accepted
"subject to draft attached to bill of lading in full payment of such shipment." What passed
between the parties upon this point appears to have the character of mere diplomatic
parrying, as the plaintiff had no contract from any responsible purchaser other than his
own subagents and the defendant company could no probably have filled the contracts
even if they had been backed by the Bank of England.chanroblesvirtualawlibrary
chanrobles virtual law library
Upon inspection of the plaintiff's letters (Exhibit Y and AA), there will be found ample
assurance that deposits for the amount of each shipment would be made with a bank in
Manila provided the defendant would indicated its ability to fill the orders; but these
assurance rested upon no other basis than the financial responsibility of the plaintiff
himself, and this circumstance doubtless did not escape the discernment of the
defendant's officers.chanroblesvirtualawlibrary chanrobles virtual law library
With respect to the order from H. Hiwatari, we observe that while he intimates that he
had been promised the exclusive agency under the plaintiff for Japan, nevertheless it does
not affirmatively appear that he had been in fact appointed to be such at the time he
signed to order Exhibit W at the request of the plaintiff. It may be assumed, therefore, that
he was at that time a stranger to the contract of agency. It clearly appears, however, that
he did not expect to purchase the thousand tons of bituminous limestone referred to in
his order without banking assistance; and although the submanager of the Bank of
Taiwan had said something encouraging in respect to the matter, nevertheless that
official had refrained from giving his approval to the order Exhibit W. It is therefore not
shown affirmatively that this order proceeds from a responsible
source.chanroblesvirtualawlibrary chanrobles virtual law library
The first assignment of error in the appellant's brief is directed to the action of the trial
judge in refusing to admit Exhibit 2, 7, 8, 9 and 10, offered by the defendant, and in
admitting Exhibit E, offered by the plaintiff. The Exhibit 2 is a letter dated June 25, 1921,
or more than three weeks after the action was instituted, in which the defendant's
assistant general manager undertakes to reply to the plaintiff's letter of March 29
proceeding. It was evidently intended as an argumentative presentation of the plaintiff's
point of view in the litigation then pending, and its probative value is so slight, even if
admissible at all, that there was no error on the part of the trial court in excluding
it.chanroblesvirtualawlibrary chanrobles virtual law library
Exhibit 7, 8, 9 and 10 comprise correspondence which passed between the parties by mail
or telegraph during the first part of the year 1921. The subject-matter of this
correspondence relates to efforts that were being made by Anderson to dispose of the
controlling in the defendant corporation, and Exhibit 9 in particular contains an offer
from the plaintiff, representing certain associates, to but out Anderson's interest for a
fixed sum. While these exhibits perhaps shed some light upon the relations of the parties
during the time this controversy was brewing, the bearing of the matter upon the
litigation before us is too remote to exert any definitive influence on the case. The trial
court was not in error in our opinion in excluding these
documents.chanroblesvirtualawlibrary chanrobles virtual law library
Exhibit E is a letter from Anderson to the plaintiff, dated April 21, 1920, in which
information is given concerning the property of the defendant company. It is stated in this
letter that the output of the Lucio (quarry) during the coming year would probably be at
the rate of about five tons for twenty-four hours, with the equipment then on hand, but
that with the installation of a model cableway which was under contemplation, the
company would be able to handle two thousand tons in twenty-four hours. We see no
legitimate reason for rejecting this document, although of slight probative value; and her
error imputed to the court in admitting the same was not
committed.chanroblesvirtualawlibrary chanrobles virtual law library
Exhibit 14, which was offered in evidence by the defendant, consists of a carbon copy of
a letter dated June 13, 1921, written by the plaintiff to his attorney, Frank B. Ingersoll,
Esq., of Manila, and in which plaintiff states, among other things, that his profit from the
San Francisco contract would have been at the rate of eigthy-five cents (gold) per ton. The
authenticity of this city document is admitted, and when it was offered in evidence by the
attorney for the defendant the counsel for the plaintiff announced that he had no
objection to the introduction of this carbon copy in evidence if counsel for the defendant
would explain where this copy was secured. Upon this the attorney for the defendant
informed the court that he received the letter from the former attorneys of the defendant
without explanation of the manner in which the document had come into their
possession. Upon this the attorney for the plaintiff made this announcement: "We hereby
give notice at this time that unless such an explanation is made, explaining fully how this
carbon copy came into the possession of the defendant company, or any one representing
it, we propose to object to its admission on the ground that it is a confidential
communication between client and lawyer." No further information was then given by
the attorney for the defendant as to the manner in which the letter had come to his hands
and the trial judge thereupon excluded the document, on the ground that it was a
privileged communication between client and attorney.chanroblesvirtualawlibrary
chanrobles virtual law library
We are of the opinion that this ruling was erroneous; for even supposing that the letter
was within the privilege which protects communications between attorney and client,
this privilege was lost when the letter came to the hands of the adverse party. And it
makes no difference how the adversary acquired possession. The law protects the client
from the effect of disclosures made by him to his attorney in the confidence of the legal
relation, but when such a document, containing admissions of the client, comes to the
hand of a third party, and reaches the adversary, it is admissible in evidence. In this
connection Mr. Wigmore says:
The law provides subjective freedom for the client by assuring him of exemption from its
processes of disclosure against himself or the attorney or their agents of communication.
This much, but not a whit more, is necessary for the maintenance of the privilege. Since
the means of preserving secrecy of communication are entirely in the client's hands, and
since the privilege is a derogation from the general testimonial duty and should be strictly
construed, it would be improper to extend its prohibition to third persons who obtain
knowledge of the communications. One who overhears the communication, whether with
or without the client's knowledge, is not within the protection of the privilege. The same
rule ought to apply to one who surreptitiously reads or obtains possession of a document
in original or copy. (5 Wigmore on Evidence, 2d ed., sec. 2326.)
Although the precedents are somewhat confusing, the better doctrine is to the effect that
when papers are offered in evidence a court will take no notice of how they were
obtained, whether legally or illegally, properly or improperly; nor will it form a collateral
issue to try that question. (10 R. C. L., 931; 1 Greenl. Evid., sec. 254 a; State vs. Mathers,
15 L. R. A., 268; Gross vs. State, 33 L. R. A., [N. S.], 477, note.) chanrobles virtual law library
Our conclusion upon the entire record is that the judgment appealed from must be
reversed; and the defendant will be absolved from the complaint. It is so ordered, without
special pronouncement as to costs of either instance.
Araullo, C.J., Johnson, Avanceña, Ostrand, Johns and Romualdez, JJ., concur.
PEOPLE VS SANDIGANBAYAN
Respondent Paredes applied for a free patent over Lot No. 3097-A, Pls-67
of the Rosario Public Land Subdivision Survey in 1976. His application was
approved and an original certificate of title was issued in his favor. In 1985,
however, the Director of Lands filed an action for the cancellation of
Paredes’ patent and certificate of title since the land had been designated
as a school site. The trial court nullified said patent and title after finding
that Paredes had obtained the same through fraudulent misrepresentations
in his application. Sansaet served as counsel of Paredes in that case.
The Tanodbayan recommended the criminal prosecution of Paredes for
violation of Section 3(a) of Republic Act No. 3019 in that he used his former
position as Provincial Attorney to influence the Bureau of Lands officials to
favorably act on his application for free patent. Again, Sansaet was Paredes’
counsel of record therein. A criminal case was subsequently filed with the
Sandiganbayan.
On January 23, 1990, one Teofilo Gelacio, sent a letter to the Ombudsman
seeking the investigation of the three respondents herein for falsification of
public documents, claiming that respondent Honrada, in conspiracy with his
co-respondents, simulated and certified as true copies certain documents
purporting to be a notice of arraignment and transcripts of stenographic
notes supposedly taken during the arraignment of Paredes on the perjury
charge.
To evade responsibility for his own participation in the scheme, Sansaet
claimed that he filed falsified documents upon the inducement of Paredes.
This was intended to pave the way for his discharge as a government
witness in the consolidated cases. The proposal for the discharge of Sansaet
as a state witness was rejected by the Ombudsman, reasoning that the
confession of Sansaet falls under the privileged communication between
him and his client, Paredes, which may be objected to if presented in the
trial. Thus, the three criminal cases were filed in the Sandiganbayan. A
motion was filed by the People on July 27, 1993 for the discharge of Sansaet
as a state witness.
The issues are (1) whether the projected testimony of Sansaet, as proposed
state witness, is barred by the attorney-client privilege, and (2) whether he
is eligible for discharge as a particeps criminis.
A distinction must be made between confidential communications relating
to past crimes already committed, and future crimes intended to be
committed, by the client. The Sandiganbayan believes that in the instant
case it is dealing with a past crime, and that Sansaet is set to testify on
alleged criminal acts of respondents Paredes and Honrada that have already
been committed and consummated.
But for the application of the attorney-client privilege, the period to be
considered is the date when the privileged communication was made by the
client to the attorney in relation to either a crime committed in the past or
with respect to a crime intended to be committed in the future. In other
words, the privileged confidentiality applies only to a crime already
committed, but does not attach to a crime which a client intends to commit
in the future, for purposes of which he seeks the lawyer’s advice.
The testimony sought to be elicited from Sansaet as state witness are the
communications made to him by Paredes at the time he and Honrada were
about to falsify the documents which were later filed in the Tanodbayan by
Sansaet. Furthermore, Sansaet was himself a conspirator in the
commission of the crime of falsification which he, Paredes and Honrada
foisted upon the authorities. It is well settled that in order that a
communication between a lawyer and his client may be privileged, it must
be for a lawful purpose or in furtherance of a lawful end.
The Court is reasonably convinced that the requisites for the discharge of
Sansaet as a state witness are present and should have been favorably
appreciated by the Sandiganbayan. Sansaet is the only cooperative
eyewitness to the actual commission of the falsification charge, and the
prosecution is faced with the task of establishing the guilt of the two other
co-respondents who steadfastly deny the charge and stoutly protest their
innocence. There is thus no other direct evidence available for the
prosecution of the case; hence there is absolute necessity for the testimony
of Sansaet.
The Sandiganbayan should have taken a holistic view of all facts and issues
herein in disposing of the matter of whether to allow Sansaet to testify as
a state witness, and not merely on the sole issue of the applicability of the
attorney-client privilege.
SYLLABUS
1. REMEDIAL LAW; EVIDENCE; ADMISSIBILITY; PRIVILEGED
COMMUNICATION BETWEEN LAWYER AND CLIENT; NOT CONFINED TO
VERBAL OR WRITTEN COMMUNICATION. — In the American jurisdiction
from which our present evidential rule was taken, there is no particular
mode by which a confidential communication shall be made by a client to
his attorney. The privilege is not confined to verbal or written
communications made by the client to his attorney but extends as well to
information communicated by the client to the attorney by other means.
2. ID.; ID.; ID.; ID.; FUTURE CRIMES, NOT COVERED. — A distinction must
be made between confidential communications relating to past crimes
already committed, and future crimes intended to be committed, by the
client. Corollarily, it is admitted that the announced intention of a client to
commit a crime is not included within the confidences which his attorney is
bound to respect. For the application of the attorney-client privilege,
however, the period to be considered is the date when the privileged
communication was made by the client to the attorney in relation to either
a crime committed in the past or with respect to a crime intended to be
committed in the future. In other words, if the client seeks his lawyer’s
advice with respect to a crime that the former has theretofore committed,
he is given the protection of a virtual confessional seal which the attorney-
client privilege declares cannot be broken by the attorney without the
client’s consent. The same privileged confidentiality, however, does not
attach with regard to a crime which a client intends to commit thereafter
or in the future and for purposes of which he seeks the lawyer’s advice.
Statements and communications regarding the commission of a crime
already committed, made by a party who committed it, to an attorney,
consulted as such, are privileged communications. Contrarily, the unbroken
stream of judicial dicta is to the effect that communications between
attorney and client having to do with the client’s contemplated criminal
acts, or in aid or furtherance thereof, are not covered by the cloak of
privileges ordinarily existing in reference to communications between
attorney and client. (Emphasis supplied.)
3. ID.; ID.; ID.; ID.; ID.; CASE AT BAR. — In the present cases, the
testimony sought to be elicited from Sansaet as state witness are the
communications made to him by physical acts and/or accompanying words
of Paredes at the time he and Honrada, either with the active or passive
participation of Sansaet, were about to falsify, or in the process of falsifying,
the documents which were later filed in Tanodbayan by Sansaet and
culminated in the criminal charges now pending in respondent
Sandiganbayan. Clearly, therefore, the confidential communications thus
made by Paredes to Sansaet were for purposes of and in reference to the
crime of falsification which had not yet been committed in the past by
Paredes but which he, in confederacy with his present co-respondents, later
committed. Having been made for purposes of a future offense, those
communications are outside the pale of the attorney-client privilege. It is
evident, therefore, that it was error for respondent Sandiganbayan to insist
that such unlawful communications intended for an illegal purpose
contrived by conspirators are nonetheless covered by the so-called mantle
of privilege. To prevent a conniving counsel from revealing the genesis of
a crime which was later committed pursuant to a conspiracy, because of
the objection thereto of his conspiring client, would be one of the worst
travesties in the rules of evidence and practice in the noble profession of
law. The Court is reasonably convinced, and so holds, that the other
requisites for the discharge of respondent Sansaet as a state witness are
present and should have been favorably appreciated by the
Sandiganbayan.
4. ID.; ID.; ID.; ID.; PRIVILEGE MUST BE FOR A LAWFUL PURPOSE. — In
order that a communication between a lawyer and his client may be
privileged, it must be for a lawful purpose or in furtherance of a lawful
purpose or in furtherance of a lawful end. The existence of an unlawful
purpose prevents the privilege from attaching. In fact, it has also been
pointed out to the Court that the "prosecution of the honorable relation of
attorney and client will not be permitted under the guise of privilege, and
every communication made to an attorney by a client for a criminal purpose
is a conspiracy or attempt at a conspiracy which is not only lawful to
divulge, but which the attorney under certain circumstances may be bound
to disclose at once in the interest of justice.
5. ID.; CRIMINAL PROCEDURE; DISCHARGE OF ACCUSED AS STATE
WITNESS; FACT OF FILING OF SEPARATE INFORMATION AGAINST THE
ACCUSED IMMATERIAL WHERE CASES WERE JOINED AND
CONSOLIDATED. — A reservation is raised over the fact that the three
private respondents here stand charged in three separate informations. It
will be recalled that in its resolution of February 24, 1992, the Ombudsman
recommended the filing of criminal charges for falsification of public
documents against all the respondents herein. That resolution was affirmed
but, reportedly in order to obviate further controversy, one information was
filed against each of the three respondents here, resulting in three
informations for the same acts of falsification. This technicality was,
however, sufficiently explained away during the deliberations in this case
by the following discussion thereof by Mr. Justice Davide, to wit; "Assuming
no substantive impediment exists to block "Sansaet’s discharge as state
witness, he can, nevertheless, be discharge even if indicted under a
separate information. I suppose the three cases were consolidated for joint
trial since they were all raffled to the Second Division of the Sandiganbayan.
Section 2, Rule XV of the Revised Rules of the Sandiganbayan allows
consolidation in only one Division of cases arising from the same incident
or series of incidents, or involving common questions of law and fact.
Accordingly, for all legal intents and purposes, Sansaet stood as co-accused
and he could be discharged as state witness. It is of no moment that he
was charged separately from his co-accused. While Section 9 of Rule 119
of the 1985 Rules of Criminal Procedure uses the word jointly, which was
absent in the old provision, the consolidated and joint trial has the effect of
making the three accused co-accused or joint defendants, especially
considering that they are charged for the same offense. In criminal law,
persons indicted for the same offense and tried together are called joint
defendants." As likewise submitted therefor by Mr. Justice Francisco along
the same vein, there having been a consolidation of the three cases, the
several actions lost their separate identities and became a single action in
which a single judgment is rendered, the same as if the different causes of
action involved had originally been joined in a single action.
6. ID.; ID.; ID.; WORD "JOINT," CONSTRUED. — Indeed, the former
provision of the Rules referring to the situation" (w)hen two or more
persons are charged with the commission of a certain offense" was too
broad and indefinite; hence, the word "joint" was added to indicate the
identity of the charge and the fact that the accused are all together charged
therewith substantially in the same manner in point of commission and
time. The word "joint" means "common to two or more," as "involving the
united activity of two or more," or "done or produced by two or more
working together," or "shared by or affecting two or more." Had it been
intended that all the accused should always be indicted in one and the same
information, the Rules could have said so with facility, but it did not so
require in consideration of the circumstances obtaining in the present case
and the problems that may arise from amending the information. After all,
the purpose of the Rule can be achieved by consolidation of the cases as
an alternative mode.
7. ID.; ID.; ID.; ACCUSED MUST NOT APPEAR TO BE THE MOST GUILTY;
IN CONSPIRACY, THE ACTUAL AND INDIVIDUAL PARTICIPATION OF
ACCUSED SERVES AS CRITERIA. — In a conspiracy the act of one is the act
of all, the same penalty shall be imposed on all members of the conspiracy.
Now, one of the requirements for a state witness is that he "does not appear
to be the most guilty," not that he must be the least guilty as is so often
erroneously framed or submitted. The query would then be whether an
accused who was held guilty by reason of membership in a conspiracy is
eligible to be a state witness. In People v. Ocimar, Et Al., the Court agreed
with the observations of the Solicitor General that the rule on the discharge
of an accused to be utilized as state witness clearly looks at his actual and
individual participation in the commission of the crime, which may or may
not have been perpetrated in conspiracy with the other accused. Since
Bermudez was not individually responsible for the killing committed on the
occasion of the robbery except by reason of conspiracy, it cannot be said
then that Bermudez appears to be the most guilty. Hence, his discharge to
be a witness for the government is clearly warranted.
8. ID.; ID.; ID.; GRANT OR DENIAL THEREOF MUST BE BASED NOT SOLELY
ON THE ISSUE OF APPLICABILITY OF ATTORNEY-CLIENT PRIVILEGE. —
This Court is not unaware of the doctrinal rule that, on this procedural
aspect, the prosecution may proposed that an accused be discharged as a
state witness but it is for the trial court, in the exercise of its sound
discretion, to determine the merits of the proposal and make the
corresponding disposition. It must be emphasized, however, that such
discretion should have been exercised and the disposition taken on a
holistic view of all the facts and issue herein discussed, and not merely on
the sole issues of the applicability of the attorney-client privilege.
REGALA VS SANDIGANBAYAN
These cases touch the very cornerstone of every State's judicial system, upon which the
workings of the contentious and adversarial system in the Philippine legal process are
based - the sanctity of fiduciary duty in the client-lawyer relationship. The fiduciary duty
of a counsel and advocate is also what makes the law profession a unique position of trust
and confidence, which distinguishes it from any other calling. In this instance, we have no
recourse but to uphold and strengthen the mantle of protection accorded to the Petitioners were included in the Third Amended Complaint on the strength of the
confidentiality that proceeds from the performance of the lawyer's duty to his client. following allegations:
The facts of the case are undisputed. 14. Defendants Eduardo Cojuangco, Jr., Edgardo J. Angara, Jose C. Concepcion, Teodoro
Regala, Avelino V. Cruz, Rogelio A. Vinluan, Eduardo U. Escueta, Paraja G. Hayudini and
The matters raised herein are an offshoot of the institution of the Complaint on July 31,
Raul Roco of the Angara Concepcion Cruz Regala and Abello law offices (ACCRA) plotted,
1987 before the Sandiganbayan by the Republic of the Philippines, through the
devised, schemed. conspired and confederated with each other in setting up, through the
Presidential Commission on Good Government against Eduardo M. Cojuangco, Jr., as one
use of the coconut levy funds, the financial and corporate framework and structures that
of the principal defendants, for the recovery of alleged ill-gotten wealth, which includes
led to the establishment of UCPB, UNICOM, COCOLIFE, COCOMARK, CIC, and more than
shares of stocks in the named corporations in PCGG Case No. 33 (Civil Case No. 0033),
twenty other coconut levy funded corporations, including the acquisition of San Miguel
entitled "Republic of the Philippines versus Eduardo Cojuangco, et al."
1cräläwvirtualibräry
Corporation shares and its institutionalization through presidential directives of the
coconut monopoly. Through insidious means and machinations, ACCRA, being the
Among the defendants named in the case are herein petitioners Teodoro Regala, Edgardo wholly-owned investment arm, ACCRA Investments Corporation, became the holder of
J. Angara, Avelino V. Cruz, Jose C. Concepcion, Rogelio A. Vinluan, Victor P. Lazatin, approximately fifteen million shares representing roughly 3.3% of the total outstanding
Eduardo U. Escueta and Paraja G. Hayudini, and herein private respondent Raul S. Roco, capital stock of UCPB as of 31 March 1987. This ranks ACCRA Investments Corporation
who all were then partners of the law firm Angara, Abello, Concepcion, Regala and Cruz number 44 among the top 100 biggest stockholders of UCPB which has approximately
Law Offices (hereinafter referred to as the ACCRA Law Firm). ACCRA Law Firm performed 1,400,000 shareholders. On the other hand, corporate books show the name Edgardo J.
legal services for its clients, which included, among others, the organization and Angara as holding approximately 3,744 shares as of February, 1984. 5cräläwvirtualibräry
acquisition of business associations and/or organizations, with the correlative and
In their answer to the Expanded Amended Complaint, petitioners ACCRA lawyers alleged
incidental services where its members acted as incorporators, or simply, as stockholders.
that:
More specifically, in the performance of these services, the members of the law firm
delivered to its client documents which substantiate the client's equity holdings, i.e., stock 4.4. Defendants-ACCRA lawyers participation in the acts with which their co-defendants
certificates endorsed in blank representing the shares registered in the client's name, and are charged, was in furtherance of legitimate lawyering.
a blank deed of trust or assignment covering said shares. In the course of their dealings
4.4.1. In the course of rendering professional and legal services to clients, defendants-
with their clients, the members of the law firm acquire information relative to the assets
ACCRA lawyers, Jose C. Concepcion, Teodoro D. Regala, Rogelio A. Vinluan and Eduardo
of clients as well as their personal and business circumstances. As members of the ACCRA
U. Escueta, became holders of shares of stock in the corporations listed under their
Law Firm, petitioners and private respondent Raul Roco admit that they assisted in the
respective names in Annex A of the expanded Amended Complaint as incorporating or
organization and acquisition of the companies included in Civil Case No. 0033, and in
acquiring stockholders only and, as such, they do not claim any proprietary interest in the
keeping with the office practice, ACCRA lawyers acted as nominees-stockholders of the
said shares of stock.
said corporations involved in sequestration proceedings. 2cräläwvirtualibräry
4.5. Defendant ACCRA-lawyer Avelino V. Cruz was one of the incorporators in 1976 of
On August 20, 1991, respondent Presidential Commission on Good Government
Mermaid Marketing Corporation, which was organized for legitimate business purposes
(hereinafter referred to as respondent PCGG) filed a "Motion to Admit Third Amended
not related to the allegations of the expanded Amended Complaint. However, he has long
Complaint" and "Third Amended Complaint" which excluded private respondent Raul S.
ago transferred any material interest therein and therefore denies that the shares
Roco from the complaint in PCGG Case No. 33 as party-defendant. 3 Respondent PCGG
appearing in his name in Annex A of the expanded Amended Complaint are his assets.
based its exclusion of private respondent Roco as party-defendant on his undertaking
6cräläwvirtualibräry
that he will reveal the identity of the principal/s for whom he acted as
nominee/stockholder in the companies involved in PCGG Case No. 33.
4cräläwvirtualibräry
Petitioner Paraja Hayudini, who had separated from ACCRA law firm, filed a separate
answer denying the allegations in the complaint implicating him in the alleged ill-gotten
wealth. 7cräläwvirtualibräry
Petitioners ACCRA lawyers subsequently filed their "COMMENT AND/OR OPPOSITION"
dated October 8, 1991 with Counter-Motion that respondent PCGG similarly grant the
same treatment to them (exclusion as parties-defendants) as accorded private
respondent Roco. 8 The Counter-Motion for dropping petitioners from the complaint was
duly set for hearing on October 18, 1991 in accordance with the requirements of Rule 15
of the Rules of Court.
In its "Comment," respondent PCGG set the following conditions precedent for the
exclusion of petitioners, namely: (a) the disclosure of the identity of its clients; (b)
submission of documents substantiating the lawyer-client relationship; and (c) the
submission of the deeds of assignments petitioners executed in favor of its clients
covering their respective shareholdings. 9cräläwvirtualibräry
Consequently, respondent PCGG presented supposed proof to substantiate compliance
by private respondent Roco of the conditions precedent to warrant the latter's exclusion
as party-defendant in PCGG Case No. 33, to wit: (a) Letter to respondent PCGG of the
counsel of respondent Roco dated May 24, 1989 reiterating a previous request for
reinvestigation by the PCGG in PCGG Case No. 33; (b) Affidavit dated March 8, 1989
executed by private respondent Roco as Attachment to the letter aforestated in (a); and
(c) Letter of the Roco, Bunag, and Kapunan Law Offices dated September 21, 1988 to the
respondent PCGG in behalf of private respondent Roco originally requesting the
reinvestigation and/or re-examination of the evidence of the PCGG against Roco in its
Complaint in PCGG Case No. 33. 10cräläwvirtualibräry
It is noteworthy that during said proceedings, private respondent Roco did not refute
petitioners' contention that he did actually not reveal the identity of the client involved
in PCGG Case No. 33, nor had he undertaken to reveal the identity of the client for whom
he acted as nominee-stockholder. 11cräläwvirtualibräry
On March 18, 1992, respondent Sandiganbayan promulgated the Resolution, herein
questioned, denying the exclusion of petitioners in PCGG Case No. 33, for their refusal to
comply with the conditions required by respondent PCGG. It held:
x x x.
ACCRA lawyers may take the heroic stance of not revealing the identity of the client for
whom they have acted, i.e. their principal, and that will be their choice. But until they do
identify their clients, considerations of whether or not the privilege claimed by the ACCRA
lawyers exists cannot even begin to be debated. The ACCRA lawyers cannot excuse
themselves from the consequences of their acts until they have begun to establish the
basis for recognizing the privilege; the existence and identity of the client.
This is what appears to be the cause for which they have been impleaded by the PCGG as
defendants herein.
5. The PCGG is satisfied that defendant Roco has demonstrated his agency and that Roco
has apparently identified his principal, which revelation could show the lack of cause
against him. This in turn has allowed the PCGG to exercise its power both under the rules
of Agency and under Section 5 of E.O. No. 14-A in relation to the Supreme Court's ruling
in Republic v. Sandiganbayan (173 SCRA 72).
The PCGG has apparently offered to the ACCRA lawyers the same conditions availed of by
Roco; full disclosure in exchange for exclusion from these proceedings (par. 7, PCGG's
COMMENT dated November 4, 1991). The ACCRA lawyers have preferred not to make the
disclosures required by the PCGG.
The ACCRA lawyers cannot, therefore, begrudge the PCGG for keeping them as party
defendants. In the same vein, they cannot compel the PCGG to be accorded the same
treatment accorded to Roco.
Neither can this Court.
WHEREFORE, the Counter Motion dated October 8, 1991 filed by the ACCRA lawyers and
joined in by Atty. Paraja G. Hayudini for the same treatment by the PCGG as accorded to
Raul S. Roco is DENIED for lack of merit. 12cräläwvirtualibräry
ACCRA lawyers moved for a reconsideration of the above resolution but the same was
denied by the respondent Sandiganbayan. Hence, the ACCRA lawyers filed the petition for
certiorari, docketed as G.R. No. 105938, invoking the following grounds:
I
The Honorable Sandiganbayan gravely abused its discretion in subjecting petitioners
ACCRA lawyers who undisputably acted as lawyers in serving as nominee-stockholders,
to the strict application of the law of agency.
II
The Honorable Sandiganbayan committed grave abuse of discretion in not considering
petitioners ACCRA lawyers and Mr. Roco as similarly situated and, therefore, deserving
of equal treatment.
1. There is absolutely no evidence that Mr. Roco had revealed, or had undertaken to
reveal, the identities of the client(s) for whom he acted as nominee-stockholder.
2. Even assuming that Mr. Roco had revealed, or had undertaken to reveal, the identities
of the client(s), the disclosure does not constitute a substantial distinction as would make
the classification reasonable under the equal protection clause.
3. Respondent Sandiganbayan sanctioned favoritism and undue preference in favor of Mr.
Roco in violation of the equal protection clause.
III
The Honorable Sandiganbayan committed grave abuse of discretion in not holding that,
under the facts of this case, the attorney-client privilege prohibits petitioners ACCRA
lawyers from revealing the identity of their client(s) and the other information requested
by the PCGG.
1. Under the peculiar facts of this case, the attorney-client privilege includes the identity
of the client(s).
2. The factual disclosures required by the PCGG are not limited to the identity of
petitioners ACCRA lawyers' alleged client(s) but extend to other privileged matters.
IV
The Honorable Sandiganbayan committed grave abuse of discretion in not requiring that
the dropping of party-defendants by the PCGG must be based on reasonable and just
grounds and with due consideration to the constitutional right of petitioners ACCRA
lawyers to the equal protection of the law.
Petitioner Paraja G. Hayudini, likewise, filed his own motion for reconsideration of the
March 18, 1991 resolution which was denied by respondent Sandiganbayan. Thus, he
filed a separate petition for certiorari, docketed as G.R. No. 108113, assailing respondent
Sandiganbayan's resolution on essentially the same grounds averred by petitioners in
G.R. No. 105938.
Petitioners contend that the exclusion of respondent Roco as party-defendant in PCGG
Case No. 33 grants him a favorable treatment, on the pretext of his alleged undertaking
to divulge the identity of his client, giving him an advantage over them who are in the
same footing as partners in the ACCRA law firm. Petitioners further argue that even
granting that such an undertaking has been assumed by private respondent Roco, they
are prohibited from revealing the identity of their principal under their sworn mandate
and fiduciary duty as lawyers to uphold at all times the confidentiality of information
obtained during such lawyer-client relationship.
Respondent PCGG, through its counsel, refutes petitioners' contention, alleging that the
revelation of the identity of the client is not within the ambit of the lawyer-client
confidentiality privilege, nor are the documents it required (deeds of assignment)
protected, because they are evidence of nominee status. 13cräläwvirtualibräry
In his comment, respondent Roco asseverates that respondent PCGG acted correctly in
excluding him as party-defendant because he "(Roco) has not filed an Answer. PCGG had
therefore the right to dismiss Civil Case No. 0033 as to Roco `without an order of court by
filing a notice of dismissal,'" 14 and he has undertaken to identify his principal.
15cräläwvirtualibräry
Petitioners' contentions are impressed with merit.
I
It is quite apparent that petitioners were impleaded by the PCGG as co-defendants to
force them to disclose the identity of their clients. Clearly, respondent PCGG is not after
petitioners but the "bigger fish" as they say in street parlance. This ploy is quite clear from
the PCGGs willingness to cut a deal with petitioners -- the names of their clients in
exchange for exclusion from the complaint. The statement of the Sandiganbayan in its
questioned resolution dated March 18, 1992 is explicit:
ACCRA lawyers may take the heroic stance of not revealing the identity of the client for
whom they have acted, i.e., their principal, and that will be their choice. But until they do
identify their clients, considerations of whether or not the privilege claimed by the ACCRA
lawyers exists cannot even begin to be debated. The ACCRA lawyers cannot excuse
themselves from the consequences of their acts until they have begun to establish the
basis for recognizing the privilege; the existence and identity of the client.
This is what appears to be the cause for which they have been impleaded by the PCGG as
defendants herein. (Underscoring ours)
In a closely related case, Civil Case No. 0110 of the Sandiganbayan, Third Division, entitled
"Primavera Farms, Inc., et al. vs. Presidential Commission on Good Government"
respondent PCGG, through counsel Mario Ongkiko, manifested at the hearing on
December 5, 1991 that the PCGG wanted to establish through the ACCRA that their "so
called client is Mr. Eduardo Cojuangco"; that "it was Mr. Eduardo Cojuangco who
furnished all the monies to those subscription payments in corporations included in
Annex "A" of the Third Amended Complaint; that the ACCRA lawyers executed deeds of
trust and deeds of assignment, some in the name of particular persons, some in blank.
We quote Atty. Ongkiko:
ATTY. ONGKIKO:
With the permission of this Hon. Court. I propose to establish through these ACCRA
lawyers that, one, their so-called client is Mr. Eduardo Cojuangco. Second, it was Mr.
Eduardo Cojuangco who furnished all the monies to these subscription payments of these
corporations who are now the petitioners in this case. Third, that these lawyers executed
deeds of trust, some in the name of a particular person, some in blank. Now, these blank
deeds are important to our claim that some of the shares are actually being held by the
nominees for the late President Marcos. Fourth, they also executed deeds of assignment
and some of these assignments have also blank assignees. Again, this is important to our
claim that some of the shares are for Mr. Cojuangco and some are for Mr. Marcos. Fifth,
that most of these corporations are really just paper corporations. Why do we say that?
One: There are no really fixed sets of officers, no fixed sets of directors at the time of
incorporation and even up to 1986, which is the crucial year. And not only that, they have
no permits from the municipal authorities in Makati. Next, actually all their addresses
now are care of Villareal Law Office. They really have no address on records. These are
some of the principal things that we would ask of these nominees stockholders, as they
called themselves. 16cräläwvirtualibräry
It would seem that petitioners are merely standing in for their clients as defendants in
the complaint. Petitioners are being prosecuted solely on the basis of activities and
services performed in the course of their duties as lawyers. Quite obviously, petitioners
inclusion as co-defendants in the complaint is merely being used as leverage to compel
them to name their clients and consequently to enable the PCGG to nail these clients. Such
being the case, respondent PCGG has no valid cause of action as against petitioners and
should exclude them from the Third Amended Complaint.
II
The nature of lawyer-client relationship is premised on the Roman Law concepts of
locatio conductio operarum (contract of lease of services) where one person lets his
services and another hires them without reference to the object of which the services are
to be performed, wherein lawyers' services may be compensated by honorarium or for
hire, 17 and mandato (contract of agency) wherein a friend on whom reliance could be
placed makes a contract in his name, but gives up all that he gained by the contract to the
person who requested him. 18 But the lawyer-client relationship is more than that of the
principal-agent and lessor-lessee.
In modern day perception of the lawyer-client relationship, an attorney is more than a
mere agent or servant, because he possesses special powers of trust and confidence
reposed on him by his client. 19 A lawyer is also as independent as the judge of the court,
thus his powers are entirely different from and superior to those of an ordinary agent. 20
Moreover, an attorney also occupies what may be considered as a "quasi-judicial office"
since he is in fact an officer of the Court 21 and exercises his judgment in the choice of
courses of action to be taken favorable to his client.
Thus, in the creation of lawyer-client relationship, there are rules, ethical conduct and
duties that breathe life into it, among those, the fiduciary duty to his client which is of a
very delicate, exacting and confidential character, requiring a very high degree of fidelity
and good faith, 22 that is required by reason of necessity and public interest 23 based on
the hypothesis that abstinence from seeking legal advice in a good cause is an evil which
is fatal to the administration of justice. 24cräläwvirtualibräry
It is also the strict sense of fidelity of a lawyer to his client that distinguishes him from
any other professional in society. This conception is entrenched and embodies centuries
of established and stable tradition. 25 In Stockton v. Ford, 26 the U.S. Supreme Court held:
There are few of the business relations of life involving a higher trust and confidence than
that of attorney and client, or generally speaking, one more honorably and faithfully
discharged; few more anxiously guarded by the law, or governed by the sterner principles
of morality and justice; and it is the duty of the court to administer them in a
corresponding spirit, and to be watchful and industrious, to see that confidence thus
reposed shall not be used to the detriment or prejudice of the rights of the party
bestowing it. 27cräläwvirtualibräry
In our jurisdiction, this privilege takes off from the old Code of Civil Procedure enacted
by the Philippine Commission on August 7, 1901. Section 383 of the Code specifically
"forbids counsel, without authority of his client to reveal any communication made by the
client to him or his advice given thereon in the course of professional employment." 28
Passed on into various provisions of the Rules of Court, the attorney-client privilege, as
currently worded provides:
Sec. 24. Disqualification by reason of privileged communication. - The following persons
cannot testify as to matters learned in confidence in the following cases:
xxx
An attorney cannot, without the consent of his client, be examined as to any
communication made by the client to him, or his advice given thereon in the course of, or
with a view to, professional employment, can an attorneys secretary, stenographer, or
clerk be examined, without the consent of the client and his employer, concerning any
fact the knowledge of which has been acquired in such capacity. 29cräläwvirtualibräry
Further, Rule 138 of the Rules of Court states:
Sec. 20. It is the duty of an attorney:
(e) to maintain inviolate the confidence, and at every peril to himself, to preserve the
secrets of his client, and to accept no compensation in connection with his clients business
except from him or with his knowledge and approval.
This duty is explicitly mandated in Canon 17 of the Code of Professional Responsibility
which provides that:
Canon 17. A lawyer owes fidelity to the cause of his client and he shall be mindful of the
trust and confidence reposed in him.
Canon 15 of the Canons of Professional Ethics also demands a lawyer's fidelity to client:
The lawyer owes "entire devotion to the interest of the client, warm zeal in the
maintenance and defense of his rights and the exertion of his utmost learning and ability,"
to the end that nothing be taken or be withheld from him, save by the rules of law, legally
applied. No fear of judicial disfavor or public popularity should restrain him from the full
discharge of his duty. In the judicial forum the client is entitled to the benefit of any and
every remedy and defense that is authorized by the law of the land, and he may expect
his lawyer to assert every such remedy or defense. But it is steadfastly to be borne in mind
that the great trust of the lawyer is to be performed within and not without the bounds
of the law. The office of attorney does not permit, much less does it demand of him for
any client, violation of law or any manner of fraud or chicanery. He must obey his own
conscience and not that of his client.
Considerations favoring confidentiality in lawyer-client relationships are many and serve
several constitutional and policy concerns. In the constitutional sphere, the privilege
gives flesh to one of the most sacrosanct rights available to the accused, the right to
counsel. If a client were made to choose between legal representation without effective
communication and disclosure and legal representation with all his secrets revealed then
he might be compelled, in some instances, to either opt to stay away from the judicial
system or to lose the right to counsel. If the price of disclosure is too high, or if it amounts
to self incrimination, then the flow of information would be curtailed thereby rendering
the right practically nugatory. The threat this represents against another sacrosanct
individual right, the right to be presumed innocent is at once self-evident.
Encouraging full disclosure to a lawyer by one seeking legal services opens the door to a
whole spectrum of legal options which would otherwise be circumscribed by limited
information engendered by a fear of disclosure. An effective lawyer-client relationship is
largely dependent upon the degree of confidence which exists between lawyer and client
which in turn requires a situation which encourages a dynamic and fruitful exchange and
flow of information. It necessarily follows that in order to attain effective representation,
the lawyer must invoke the privilege not as a matter of option but as a matter of duty and
professional responsibility.
The question now arises whether or not this duty may be asserted in refusing to disclose
the name of petitioners' client(s) in the case at bar. Under the facts and circumstances
obtaining in the instant case, the answer must be in the affirmative.
As a matter of public policy, a clients identity should not be shrouded in mystery. 30 Under
this premise, the general rule in our jurisdiction as well as in the United States is that a
lawyer may not invoke the privilege and refuse to divulge the name or identity of his
client. 31cräläwvirtualibräry
The reasons advanced for the general rule are well established.
First, the court has a right to know that the client whose privileged information is sought
to be protected is flesh and blood.
Second, the privilege begins to exist only after the attorney-client relationship has been
established. The attorney-client privilege does not attach until there is a client.
Third, the privilege generally pertains to the subject matter of the relationship.
Finally, due process considerations require that the opposing party should, as a general
rule, know his adversary. "A party suing or sued is entitled to know who his opponent is."
32 He cannot be obliged to grope in the dark against unknown forces.
33cräläwvirtualibräry
Notwithstanding these considerations, the general rule is however qualified by some
important exceptions.
1) Client identity is privileged where a strong probability exists that revealing the clients
name would implicate that client in the very activity for which he sought the lawyers
advice.
In Ex-Parte Enzor, 34 a state supreme court reversed a lower court order requiring a
lawyer to divulge the name of her client on the ground that the subject matter of the
relationship was so closely related to the issue of the clients identity that the privilege
actually attached to both. In Enzor, the unidentified client, an election official, informed
his attorney in confidence that he had been offered a bribe to violate election laws or that
he had accepted a bribe to that end. In her testimony, the attorney revealed that she had
advised her client to count the votes correctly, but averred that she could not remember
whether her client had been, in fact, bribed. The lawyer was cited for contempt for her
refusal to reveal his clients identity before a grand jury. Reversing the lower courts
contempt orders, the state supreme court held that under the circumstances of the case,
and under the exceptions described above, even the name of the client was privileged.
U.S. v. Hodge and Zweig, 35 involved the same exception, i.e. that client identity is privileged
in those instances where a strong probability exists that the disclosure of the client's
identity would implicate the client in the very criminal activity for which the lawyers legal
advice was obtained.
The Hodge case involved federal grand jury proceedings inquiring into the activities of
the "Sandino Gang," a gang involved in the illegal importation of drugs in the United
States. The respondents, law partners, represented key witnesses and suspects including
the leader of the gang, Joe Sandino.
In connection with a tax investigation in November of 1973, the IRS issued summons to
Hodge and Zweig, requiring them to produce documents and information regarding
payment received by Sandino on behalf of any other person, and vice versa. The lawyers
refused to divulge the names. The Ninth Circuit of the United States Court of Appeals,
upholding non-disclosure under the facts and circumstances of the case, held:
A clients identity and the nature of that clients fee arrangements may be privileged where
the person invoking the privilege can show that a strong probability exists that disclosure
of such information would implicate that client in the very criminal activity for which
legal advice was sought Baird v. Koerner, 279 F.2d at 680. While in Baird Owe enunciated
this rule as a matter of California law, the rule also reflects federal law. Appellants
contend that the Baird exception applies to this case.
The Baird exception is entirely consonant with the principal policy behind the attorney-
client privilege. "In order to promote freedom of consultation of legal advisors by clients,
the apprehension of compelled disclosure from the legal advisors must be removed;
hence, the law must prohibit such disclosure except on the clients consent." 8 J. Wigmore,
supra sec. 2291, at 545. In furtherance of this policy, the clients identity and the nature of
his fee arrangements are, in exceptional cases, protected as confidential communications.
36cräläwvirtualibräry
2) Where disclosure would open the client to civil liability, his identity is privileged. For
instance, the peculiar facts and circumstances of Neugass v. Terminal Cab Corporation, 37
prompted the New York Supreme Court to allow a lawyers claim to the effect that he could
not reveal the name of his client because this would expose the latter to civil litigation.
In the said case, Neugass, the plaintiff, suffered injury when the taxicab she was riding,
owned by respondent corporation, collided with a second taxicab, whose owner was
unknown. Plaintiff brought action both against defendant corporation and the owner of
the second cab, identified in the information only as John Doe. It turned out that when the
attorney of defendant corporation appeared on preliminary examination, the fact was
somehow revealed that the lawyer came to know the name of the owner of the second
cab when a man, a client of the insurance company, prior to the institution of legal action,
came to him and reported that he was involved in a car accident. It was apparent under
the circumstances that the man was the owner of the second cab. The state supreme court
held that the reports were clearly made to the lawyer in his professional capacity. The
court said:
That his employment came about through the fact that the insurance company had hired
him to defend its policyholders seems immaterial. The attorney in such cases is clearly
the attorney for the policyholder when the policyholder goes to him to report an
occurrence contemplating that it would be used in an action or claim against him. 38
x x x xxx xxx.
All communications made by a client to his counsel, for the purpose of professional advice
or assistance, are privileged, whether they relate to a suit pending or contemplated, or to
any other matter proper for such advice or aid; x x x And whenever the communication
made, relates to a matter so connected with the employment as attorney or counsel as to
afford presumption that it was the ground of the address by the client, then it is privileged
from disclosure. xxx.
It appears... that the name and address of the owner of the second cab came to the
attorney in this case as a confidential communication. His client is not seeking to use the
courts, and his address cannot be disclosed on that theory, nor is the present action
pending against him as service of the summons on him has not been effected. The
objections on which the court reserved decision are sustained. 39cräläwvirtualibräry
In the case of Matter of Shawmut Mining Company, 40 the lawyer involved was required by
a lower court to disclose whether he represented certain clients in a certain transaction.
The purpose of the courts request was to determine whether the unnamed persons as
interested parties were connected with the purchase of properties involved in the action.
The lawyer refused and brought the question to the State Supreme Court. Upholding the
lawyers refusal to divulge the names of his clients the court held:
If it can compel the witness to state, as directed by the order appealed from, that he
represented certain persons in the purchase or sale of these mines, it has made progress
in establishing by such evidence their version of the litigation. As already suggested, such
testimony by the witness would compel him to disclose not only that he was attorney for
certain people, but that, as the result of communications made to him in the course of
such employment as such attorney, he knew that they were interested in certain
transactions. We feel sure that under such conditions no case has ever gone to the length
of compelling an attorney, at the instance of a hostile litigant, to disclose not only his
retainer, but the nature of the transactions to which it related, when such information
could be made the basis of a suit against his client. 41cräläwvirtualibräry
3) Where the governments lawyers have no case against an attorneys client unless, by
revealing the clients name, the said name would furnish the only link that would form the
chain of testimony necessary to convict an individual of a crime, the clients name is
privileged.
In Baird vs Korner, a lawyer was consulted by the accountants and the lawyer of certain
42
undisclosed taxpayers regarding steps to be taken to place the undisclosed taxpayers in
a favorable position in case criminal charges were brought against them by the U.S.
Internal Revenue Service (IRS).
It appeared that the taxpayers returns of previous years were probably incorrect and the
taxes understated. The clients themselves were unsure about whether or not they
violated tax laws and sought advice from Baird on the hypothetical possibility that they
had. No investigation was then being undertaken by the IRS of the taxpayers.
Subsequently, the attorney of the taxpayers delivered to Baird the sum of $12,706.85,
which had been previously assessed as the tax due, and another amount of money
representing his fee for the advice given. Baird then sent a check for $12,706.85 to the
IRS in Baltimore, Maryland, with a note explaining the payment, but without naming his
clients. The IRS demanded that Baird identify the lawyers, accountants, and other clients
involved. Baird refused on the ground that he did not know their names, and declined to
name the attorney and accountants because this constituted privileged communication.
A petition was filed for the enforcement of the IRS summons. For Bairds repeated refusal
to name his clients he was found guilty of civil contempt. The Ninth Circuit Court of
Appeals held that, a lawyer could not be forced to reveal the names of clients who
employed him to pay sums of money to the government voluntarily in settlement of
undetermined income taxes, unsued on, and with no government audit or investigation
into that clients income tax liability pending. The court emphasized the exception that a
clients name is privileged when so much has been revealed concerning the legal services
rendered that the disclosure of the clients identity exposes him to possible investigation
and sanction by government agencies. The Court held:
The facts of the instant case bring it squarely within that exception to the general rule.
Here money was received by the government, paid by persons who thereby admitted they
had not paid a sufficient amount in income taxes some one or more years in the past. The
names of the clients are useful to the government for but one purpose - to ascertain which
taxpayers think they were delinquent, so that it may check the records for that one year
or several years. The voluntary nature of the payment indicates a belief by the taxpayers
that more taxes or interest or penalties are due than the sum previously paid, if any. It
indicates a feeling of guilt for nonpayment of taxes, though whether it is criminal guilt is
undisclosed. But it may well be the link that could form the chain of testimony necessary
to convict an individual of a federal crime. Certainly the payment and the feeling of guilt
are the reasons the attorney here involved was employed - to advise his clients what,
under the circumstances, should be done. 43cräläwvirtualibräry
Apart from these principal exceptions, there exist other situations which could qualify as
exceptions to the general rule.
For example, the content of any client communication to a lawyer lies within the privilege
if it is relevant to the subject matter of the legal problem on which the client seeks legal
assistance. 44 Moreover, where the nature of the attorney-client relationship has been
previously disclosed and it is the identity which is intended to be confidential, the identity
of the client has been held to be privileged, since such revelation would otherwise result
in disclosure of the entire transaction. 45cräläwvirtualibräry
Summarizing these exceptions, information relating to the identity of a client may fall
within the ambit of the privilege when the clients name itself has an independent
significance, such that disclosure would then reveal client confidences.
46cräläwvirtualibräry
The circumstances involving the engagement of lawyers in the case at bench, therefore,
clearly reveal that the instant case falls under at least two exceptions to the general rule.
First, disclosure of the alleged client's name would lead to establish said client's
connection with the very fact in issue of the case, which is privileged information, because
the privilege, as stated earlier, protects the subject matter or the substance (without
which there would be no attorney-client relationship).
The link between the alleged criminal offense and the legal advice or legal service sought
was duly established in the case at bar, by no less than the PCGG itself. The key lies in the
three specific conditions laid down by the PCGG which constitutes petitioners ticket to
non-prosecution should they accede thereto:
(a) the disclosure of the identity of its clients;
(b) submission of documents substantiating the lawyer-client relationship; and
(c) the submission of the deeds of assignment petitioners executed in favor of their clients
covering their respective shareholdings.
From these conditions, particularly the third, we can readily deduce that the clients
indeed consulted the petitioners, in their capacity as lawyers, regarding the financial and
corporate structure, framework and set-up of the corporations in question. In turn,
petitioners gave their professional advice in the form of, among others, the
aforementioned deeds of assignment covering their clients shareholdings.
There is no question that the preparation of the aforestated documents was part and
parcel of petitioners legal service to their clients. More important, it constituted an
integral part of their duties as lawyers. Petitioners, therefore, have a legitimate fear that
identifying their clients would implicate them in the very activity for which legal advice
had been sought, i.e., the alleged accumulation of ill-gotten wealth in the aforementioned
corporations.
Furthermore, under the third main exception, revelation of the client's name would
obviously provide the necessary link for the prosecution to build its case, where none
otherwise exists. It is the link, in the words of Baird, "that would inevitably form the chain
of testimony necessary to convict the (client) of a... crime." 47cräläwvirtualibräry
An important distinction must be made between a case where a client takes on the
services of an attorney for illicit purposes, seeking advice about how to go around the law
for the purpose of committing illegal activities and a case where a client thinks he might
have previously committed something illegal and consults his attorney about it. The first
case clearly does not fall within the privilege because the same cannot be invoked for
purposes illegal. The second case falls within the exception because whether or not the
act for which the advice turns out to be illegal, his name cannot be used or disclosed if the
disclosure leads to evidence, not yet in the hands of the prosecution, which might lead to
possible action against him.
These cases may be readily distinguished, because the privilege cannot be invoked or
used as a shield for an illegal act, as in the first example; while the prosecution may not
have a case against the client in the second example and cannot use the attorney client
relationship to build up a case against the latter. The reason for the first rule is that it is
not within the professional character of a lawyer to give advice on the commission of a
crime. 48 The reason for the second has been stated in the cases above discussed and are
founded on the same policy grounds for which the attorney-client privilege, in general,
exists.
In Matter of Shawmut Mining Co., supra, the appellate court therein stated that "under
such conditions no case has ever yet gone to the length of compelling an attorney, at the
instance of a hostile litigant, to disclose not only his retainer, but the nature of the
transactions to which it related, when such information could be made the basis of a suit
against his client." 49 "Communications made to an attorney in the course of any
personal employment, relating to the subject thereof, and which may be supposed to
be drawn out in consequence of the relation in which the parties stand to each other, are
under the seal of confidence and entitled to protection as privileged communications." 50
Where the communicated information, which clearly falls within the privilege, would
suggest possible criminal activity but there would be not much in the information known
to the prosecution which would sustain a charge except that revealing the name of the
client would open up other privileged information which would substantiate the
prosecutions suspicions, then the clients identity is so inextricably linked to the subject
matter itself that it falls within the protection. The Baird exception, applicable to the
instant case, is consonant with the principal policy behind the privilege, i.e., that for the
purpose of promoting freedom of consultation of legal advisors by clients, apprehension
of compelled disclosure from attorneys must be eliminated. This exception has likewise
been sustained in In re Grand Jury Proceedings 51 and Tillotson v. Boughner. 52 What these
cases unanimously seek to avoid is the exploitation of the general rule in what may
amount to a fishing expedition by the prosecution.
There are, after all, alternative sources of information available to the prosecutor which
do not depend on utilizing a defendant's counsel as a convenient and readily available
source of information in the building of a case against the latter. Compelling disclosure of
the client's name in circumstances such as the one which exists in the case at bench
amounts to sanctioning fishing expeditions by lazy prosecutors and litigants which we
cannot and will not countenance. When the nature of the transaction would be revealed
by disclosure of an attorney's retainer, such retainer is obviously protected by the
privilege. 53 It follows that petitioner attorneys in the instant case owe their client(s) a
duty and an obligation not to disclose the latter's identity which in turn requires them to
invoke the privilege.
In fine, the crux of petitioners' objections ultimately hinges on their expectation that if
the prosecution has a case against their clients, the latter's case should be built upon
evidence painstakingly gathered by them from their own sources and not from compelled
testimony requiring them to reveal the name of their clients, information which
unavoidably reveals much about the nature of the transaction which may or may not be
illegal. The logical nexus between name and nature of transaction is so intimate in this
case that it would be difficult to simply dissociate one from the other. In this sense, the
name is as much "communication" as information revealed directly about the transaction
in question itself, a communication which is clearly and distinctly privileged. A lawyer
cannot reveal such communication without exposing himself to charges of violating a
principle which forms the bulwark of the entire attorney-client relationship.
The uberrimei fidei relationship between a lawyer and his client therefore imposes a strict
liability for negligence on the former. The ethical duties owing to the client, including
confidentiality, loyalty, competence, diligence as well as the responsibility to keep clients
informed and protect their rights to make decisions have been zealously sustained. In
Milbank, Tweed, Hadley and McCloy v. Boon, 54 the US Second District Court rejected the
plea of the petitioner law firm that it breached its fiduciary duty to its client by helping
the latter's former agent in closing a deal for the agent's benefit only after its client
hesitated in proceeding with the transaction, thus causing no harm to its client. The Court
instead ruled that breaches of a fiduciary relationship in any context comprise a special
breed of cases that often loosen normally stringent requirements of causation and
damages, and found in favor of the client.
To the same effect is the ruling in Searcy, Denney, Scarola, Barnhart, and Shipley P.A. v.
Scheller 55 requiring strict obligation of lawyers vis-a-vis clients. In this case, a contingent
fee lawyer was fired shortly before the end of completion of his work, and sought
payment quantum meruit of work done. The court, however, found that the lawyer was
fired for cause after he sought to pressure his client into signing a new fee agreement
while settlement negotiations were at a critical stage. While the client found a new lawyer
during the interregnum, events forced the client to settle for less than what was originally
offered. Reiterating the principle of fiduciary duty of lawyers to clients in Meinhard v.
Salmon 56 famously attributed to Justice Benjamin Cardozo that "Not honesty alone, but
the punctilio of an honor the most sensitive, is then the standard of behavior," the US
Court found that the lawyer involved was fired for cause, thus deserved no attorney's fees
at all.
The utmost zeal given by Courts to the protection of the lawyer-client confidentiality
privilege and lawyer's loyalty to his client is evident in the duration of the protection,
which exists not only during the relationship, but extends even after the termination of
the relationship. 57cräläwvirtualibräry
Such are the unrelenting duties required of lawyers vis-a-vis their clients because the law,
which the lawyers are sworn to uphold, in the words of Oliver Wendell Holmes, 58 "xxx is
an exacting goddess, demanding of her votaries in intellectual and moral discipline." The
Court, no less, is not prepared to accept respondents position without denigrating the
noble profession that is lawyering, so extolled by Justice Holmes in this wise:
Every calling is great when greatly pursued. But what other gives such scope to realize
the spontaneous energy of one's soul? In what other does one plunge so deep in the
stream of life - so share its passions its battles, its despair, its triumphs, both as witness
and actor? x x x But that is not all. What a subject is this in which we are united - this
abstraction called the Law, wherein as in a magic mirror, we see reflected, not only in our
lives, but the lives of all men that have been. When I think on this majestic theme my eyes
dazzle. If we are to speak of the law as our mistress, we who are here know that she is a
mistress only to be won with sustained and lonely passion - only to be won by straining
all the faculties by which man is likened to God.
We have no choice but to uphold petitioners' right not to reveal the identity of their clients
under pain of the breach of fiduciary duty owing to their clients, because the facts of the
instant case clearly fall within recognized exceptions to the rule that the clients name is
not privileged information.
If we were to sustain respondent PCGG that the lawyer-client confidential privilege under
the circumstances obtaining here does not cover the identity of the client, then it would
expose the lawyers themselves to possible litigation by their clients in view of the strict
fiduciary responsibility imposed on them in the exercise of their duties.
The complaint in Civil Case No. 0033 alleged that the defendants therein, including herein
petitioners and Eduardo Cojuangco, Jr. conspired with each other in setting up through
the use of coconut levy funds the financial and corporate framework and structures that
led to the establishment of UCPB, UNICOM and others and that through insidious means
and machinations, ACCRA, using its wholly-owned investment arm, ACCRA Investments
Corporation, became the holder of approximately fifteen million shares representing
roughly 3.3% of the total capital stock of UCPB as of 31 March 1987. The PCGG wanted to
establish through the ACCRA lawyers that Mr. Cojuangco is their client and it was
Cojuangco who furnished all the monies to the subscription payment; hence, petitioners
acted as dummies, nominees and/or agents by allowing themselves, among others, to be
used as instrument in accumulating ill-gotten wealth through government concessions, (ACCRA lawyers) were themselves willing to reveal. These were clients to whom both
etc., which acts constitute gross abuse of official position and authority, flagrant breach petitioners and private respondent rendered legal services while all of them were
of public trust, unjust enrichment, violation of the Constitution and laws of the Republic partners at ACCRA, and were not the clients which the PCGG wanted disclosed for the
of the Philippines. alleged questioned transactions. 61cräläwvirtualibräry
By compelling petitioners, not only to reveal the identity of their clients, but worse, to To justify the dropping of the private respondent from the case or the filing of the suit in
submit to the PCGG documents substantiating the client-lawyer relationship, as well as the respondent court without him, therefore, the PCGG should conclusively show that Mr.
deeds of assignment petitioners executed in favor of its clients covering their respective Roco was treated as a species apart from the rest of the ACCRA lawyers on the basis of a
shareholdings, the PCGG would exact from petitioners a link "that would inevitably form classification which made substantial distinctions based on real differences. No such
the chain of testimony necessary to convict the (client) of a crime." substantial distinctions exist from the records of the case at bench, in violation of the
equal protection clause.
III
The equal protection clause is a guarantee which provides a wall of protection against
In response to petitioners' last assignment of error, respondents allege that the private
uneven application of statutes and regulations. In the broader sense, the guarantee
respondent was dropped as party defendant not only because of his admission that he
operates against uneven application of legal norms so that all persons under similar
acted merely as a nominee but also because of his undertaking to testify to such facts and
circumstances would be accorded the same treatment. 62 Those who fall within a
circumstances "as the interest of truth may require, which includes... the identity of the
particular class ought to be treated alike not only as to privileges granted but also as to
principal." 59cräläwvirtualibräry
the liabilities imposed.
First, as to the bare statement that private respondent merely acted as a lawyer and
x x x. What is required under this constitutional guarantee is the uniform operation of
nominee, a statement made in his out-of-court settlement with the PCGG, it is sufficient
legal norms so that all persons under similar circumstances would be accorded the same
to state that petitioners have likewise made the same claim not merely out-of- court but
treatment both in the privileges conferred and the liabilities imposed. As was noted in a
also in their Answer to plaintiff's Expanded Amended Complaint, signed by counsel,
recent decision: Favoritism and undue preference cannot be allowed. For the principle is
claiming that their acts were made in furtherance of "legitimate lawyering." 60 Being
that equal protection and security shall be given to every person under circumstances,
"similarly situated" in this regard, public respondents must show that there exist other
which if not identical are analogous. If law be looked upon in terms of burden or charges,
conditions and circumstances which would warrant their treating the private respondent
those that fall within a class should be treated in the same fashion, whatever restrictions
differently from petitioners in the case at bench in order to evade a violation of the equal
cast on some in the group equally binding the rest. 63cräläwvirtualibräry
protection clause of the Constitution.
We find that the condition precedent required by the respondent PCGG of the petitioners
To this end, public respondents contend that the primary consideration behind their
for their exclusion as parties-defendants in PCGG Case No. 33 violates the lawyer-client
decision to sustain the PCGG's dropping of private respondent as a defendant was his
confidentiality privilege. The condition also constitutes a transgression by respondents
promise to disclose the identities of the clients in question. However, respondents failed
Sandiganbayan and PCGG of the equal protection clause of the Constitution. 64 It is grossly
to show - and absolutely nothing exists in the records of the case at bar - that private
unfair to exempt one similarly situated litigant from prosecution without allowing the
respondent actually revealed the identity of his client(s) to the PCGG. Since the
same exemption to the others. Moreover, the PCGGs demand not only touches upon the
undertaking happens to be the leitmotif of the entire arrangement between Mr. Roco and
question of the identity of their clients but also on documents related to the suspected
the PCGG, an undertaking which is so material as to have justified PCGG's special treatment
transactions, not only in violation of the attorney-client privilege but also of the
exempting the private respondent from prosecution, respondent Sandiganbayan should
constitutional right against self-incrimination. Whichever way one looks at it, this is a
have required proof of the undertaking more substantial than a "bare assertion" that
fishing expedition, a free ride at the expense of such rights.
private respondent did indeed comply with the undertaking. Instead, as manifested by the
PCGG, only three documents were submitted for the purpose, two of which were mere An argument is advanced that the invocation by petitioners of the privilege of attorney-
requests for re-investigation and one simply disclosed certain clients which petitioners client confidentiality at this stage of the proceedings is premature and that they should
wait until they are called to testify and examine as witnesses as to matters learned in Petitioner Bank for the preparation of its comments, objections, and exceptions to the
confidence before they can raise their objections. But petitioners are not mere witnesses. Conservator’s report dated January 19, 1995. The documents now asked to be produced,
They are co-principals in the case for recovery of alleged ill-gotten wealth. They have inspected, and copied are the following:chanrob1es virtual 1aw library
made their position clear from the very beginning that they are not willing to testify and
they cannot be compelled to testify in view of their constitutional right against self-
incrimination and of their fundamental legal right to maintain inviolate the privilege of (1) Copies of tapes and transcripts of the Monetary Board (MB) deliberations on the
attorney-client confidentiality. closure of Banco Filipino (BF) and its meeting on July 27, 1984, and March 22, 1985;
It is clear then that the case against petitioners should never be allowed to take its full
course in the Sandiganbayan. Petitioners should not be made to suffer the effects of
further litigation when it is obvious that their inclusion in the complaint arose from a (2) Copies of the letter and reports of first conservator, Mr. Basilio Estanislao, to the MB
privileged attorney-client relationship and as a means of coercing them to disclose the and to Central Bank Governor Jose Fernandez;
identities of their clients. To allow the case to continue with respect to them when this
Court could nip the problem in the bud at this early opportunity would be to sanction an
unjust situation which we should not here countenance. The case hangs as a real and (3) Papers showing computations of all the interests and penalties charged by the CB
palpable threat, a proverbial Sword of Damocles over petitioners' heads. It should not be against BF;
allowed to continue a day longer.
While we are aware of respondent PCGGs legal mandate to recover ill-gotten wealth, we
(4) Schedule of recommended valuation of reserves per Mr. Tiaoqui’s report dated March
will not sanction acts which violate the equal protection guarantee and the right against
19, 1995;
self-incrimination and subvert the lawyer-client confidentiality privilege.
WHEREFORE, IN VIEW OF THE FOREGOING, the Resolutions of respondent
Sandiganbayan (First Division) promulgated on March 18, 1992 and May 21, 1992 are (5) Adjustment per Annex "C" of Mr. Tiaoqui’s report;
hereby ANNULLED and SET ASIDE. Respondent Sandiganbayan is further ordered to
exclude petitioners Teodoro D. Regala, Edgardo J. Angara, Avelino V. Cruz, Jose C.
Concepcion, *Rogelio A. Vinluan, Victor P. Lazatin, Eduardo U. Escueta and Paraja G. (6) Annexes "A", "B", and "C" of the joint report of Mr. Tiaoqui, Mr. Aurellano, and Mrs.
Hayuduni as parties-defendants in SB Civil Case No. 0033 entitled "Republic of the Valenzuela;
Philippines v. Eduardo Cojuangco, Jr., et al.".
SO ORDERED.
(7) Schedule of devaluation of CB-premises of Paseo de Roxas of same report;

BANCO FILIPINO VS MONETARY BOARD

(8) Schedule of BF’s assets from P5,159.44 B to P3,909.23 B as of January 25, 1985;

Subject of this "Petition to Set Aside to Produce Documents dated 17 February 1986" is
the Order of Branch 136, Regional Trial Court, Makati, granting the motion of the (9) Documents listed in BF’s letter to Mr. Carlota Valenzuela dated October 25, 1985.
petitioner herein, based on Section 1, Rule 27, of the Rules of Court, for the production,
inspection, and copying of certain papers and records which are claimed as needed by the
In issuing the challenged order, the court below took the view that the Supreme Court’s
resolution referring to it the matters relative to the bank’s closure does not preclude the
petitioner from availing of his mode of discovery as an additional means of preparing for
the hearing. It considered the documents sought to be produced as not privileged because
these constitute or contain evidence material to the issue into by the Court. These
materials are said to compromise of records of the administrative proceedings conducted
by respondent’s officials and representatives from the inception of and preparation of the
challenged reports and the resolution placing petitioner under receivership and
thereafter under liquidation as it is the regularity and impartiality of these administrative
proceedings which are being assailed by the petitioner, the trial court saw no reason why
said documents should be thus concealed from it.
Respondents Monetary Board and Central Bank take exception to the said order and pray
in their petition before this Court for the reversal and setting aside of the same. The
grounds recited in support of their petition are the following:chanrob1es virtual 1aw
library
(1) The ratiocination of the trial court is wholly in error because the proceedings before
it do not at all deal with either the administrative proceedings conducted by the
respondents or the regularity and impartiality of the CB actions on BF; it does so simply
upon the charge that no "hearing" was given BF prior to those actions of no "hearing" was
given BF prior to those actions of closure and liquidation. However, no such prior hearing
had been called as none is required by the law and by the Supreme Court decisions in
force to this date (Rural Bank of Lucena, Inc. v. Arca, 15 SCRA 66, and Rural Bank of Bato
v. IAC, G.R. 65642, Oct. 15, 1984).
(2) The tapes and transcripts of the Monetary Board deliberations are confidential
pursuant to Sections 13 and 15 of the Central Bank Act.
"Sec. 13. Withdrawal of persons having a personal interest. — Whenever any member
attending a meeting of the Monetary Board has a material personal interest, directly or
indirectly, in the discussion or resolution of any given matter, said member and must
retire from the meeting during the deliberation thereon. The subject matter, when
resolved, and the fact that a member had a personal interest in it, shall be made available
to the public. The minutes of the meeting shall note the withdrawal of the member
concerned. (As amended by PD No. 1827).
"Sec. 15. Responsibility. — Any member of the Monetary Board or officer or employee of
the Central Bank who wilfully violates this Act or who is guilty of gross negligence in the
performance of his duties shall be held liable for any loss or injury suffered by the Bank
as a result of such violation or negligence. Similar responsibility shall apply to the
disclosure of any information of a confidential nature about the discussion or resolutions
of the Monetary Board, except as required in Section 13 of this Act, or about the operation
of the Bank, and to the use of such information for personal gain or to the detriment of
the Government, the Bank or third parties. (As amended by Presidential Decree No. 72).
(Emphasis supplied).
(3) The Monetary Board deliberations were necessarily held subsequent to the
submission of the CB reports. They did not enter into the making of those reports and can
have no materially to any question of fact that may be raised in relation to their contents.
On April 16, 1986, Petitioner Banco Filipino filed its Comment on Respondent’s petition
to set aside the order for the production of the documents. In said pleading, the petitioner
bank assails the respondent’s petition on the following grounds:chanrob1es virtual 1aw
library
(1) There is no reason why Banco Filipino should not be furnished the documents,
particularly Nos. 3 to 9 of its motion, when these are merely attachments to the
Supervision and Examination Sector, Dept. II (SECS) Reports, copies of which were given
to it pursuant to a Supreme Court order.
(2) The Supreme Court in its referral of October 8, 1985 to the RTC Makati intended full
evidence taking of the proceeding for judicial review of administrative action filed with
the Supreme Court, the trial court being better equipped for evidence taking.
(3) The respondents cannot claim privilege in refusing to produce the Central Bank
records because it is based only on the generalized interest in confidentiality. Petitioner
cites as a precedent the doctrine established in the case of U.S. v. Nixon, 418 U.S. 683,
713m which states that "when the ground for asserting privilege as to subpoenaed
materials sought for use in a criminal case is based only on the generalized interest in
confidentiality, it cannot prevail over the fundamental demands of due process of
law."cralaw virtua1aw library
(4) The requested documents are records of the Central Bank are material and relevant
because BF is entitled to prove from the CB records (a) that Governor Fernandez closed
BF without a MB resolution and without examiner’s reports on the financial position of
BF; (b) that a MB resolution was later made to legalize the BF closure but it had no
supporting examiner’s report; (c) that the earlier reports did not satisfy respondent
Governor Fernandez and he ordered the examiners and the conservator, Gilberto
Teodoro, to "improve" them; and (d) that the reports were then fabricated.
Petitioner adds that what respondents fear is disclosure of their proceedings because
petitioner has accused the CB governor of (a) covering 51% of its stockholding, (b)
encashing BF securities in trickles as fuel a run, (c) appointing a conservator when the
President ordered the MB to grant petitioner a P3 Billion credit line, (d) replacing
Estanislao with Gilberto Teodoro when the former wanted to resume normal operations
of BF, and (e) changing the conservatorship to receivership when it appointed Carlota
Valenzuela as receiver again without hearing.
On May 13, 1986, Respondent Monetary Board filed their Reply to Petitioner Bank’s
Comment dated April 15, 1986. Respondents argue that:chanrob1es virtual 1aw library
(1) The case of U.S. v. Nixon and the other decision cited by petitioner are inapplicable
because —
a) The authorities cited refer only to a claim of privilege based only on the generalized
interest of confidentiality or on an executive privilege that is merely presumptive. On the
other hand, the so-called MB deliberations are privileged communications pursuant to
section 21, Rule 130 of the Rules of Court because statements and opinions expressed in
the deliberation of the members of the MB are specially vested with confidentiality under
Secs. 13 and 15 of the Central Bank Act. The "public interest" requirement for non-
disclosure is evident from the fact that the statute punishes any disclosure of such
deliberations.
b) Petitioner has not in the least shown any relevance or need to produce the alleged MB
deliberations. What petitioner intends to prove are not "issues: raised in the pleadings of
the main petition.
(2) Petitioner is interested, not in discovering evidence, but in practicing oppression by
the forced publication of the MB members’ confidential statements at board meetings.
(3) The so-called deliberations of the Monetary Board are in truth merely the individual
statements and expressions of opinion of its members. They are not statements or
opinions that can be imputed to the board itself or to the Central Bank. The transcripts of
stenographic notes on the deliberations of the MB are not official records of the CB; they
are taken merely to assist the Secretary of the MB in the preparation of the minutes of the
meetings. And as advertedly also, the tape recordings are not available as these are used
over and over again.
The motion for the production of the subject documents was filed by petitioner pursuant
to Section 1, Rule 27, of the Rules of Court. It has been held that "a party is ordinarily
entitled to the production of books, documents and papers which are material and
relevant to the establishment of his cause of action or defense." (General Electric Co. v.
Superior Court in and for Alameda County, 45 C. 2nd 879, cited in Martin, Rules of Court,
3rd edition, Vol. 2, p. 104). "The test to be applied by the trial judge in determining the
relevancy of documents and the sufficiency of their description is one of reasonableness
and practicability" (Line Corp. of the Philippines v. Moran, 59 Phil. 176, 180). "On the
ground of public policy, the rules providing for reproduction and inspection of books and
papers do not authorize the production or inspection of privileged matter, that is, books,
papers which because of their confidential and privileged character could not be received
in evidence" (27) CJS 224). "In passing on a motion for discovery of documents, the courts
should be liberal in determining whether or not documents are relevant to the subject
matter of action" (Hercules Powder Co. v. Haas Co. U.S. Dist, Ct. Oct. 26, 1944, 9 Fed. Rules
Service, 659, cited in Moran, Comments on the Rules of Court, 1979 Ed. Vol. 2, p. 102).
Likewise, "any statute declaring in general terms that official records are confidential
should be liberally construed, to have an implied exception for disclosure when needed
in a court the case of Marbury v. Madison, 1 Cr. 137, 143).
In the light of the jurisprudence above-cited, this Court holds that no grave abuse of
discretion was committed by the court below in granting petitioner’s motion for the
production of the documents enumerated herein. We accept the view taken by the court
below that the documents are not privileged and that these constitutes or contain
evidence material to the issues being inquired into by Court.
With respect to Items Nos. 3 to 9, these are the annexes to the Supervision and
Examination Sector, Dept. II (SES) Reports submitted to the Central Bank and Monetary
Board which were taken into consideration by said respondents in closing petitioner
bank. A copy of the SES Reports was furnished to the petitioner. We, therefore, fail to see
any proper reason why the annexes thereto should no withheld. Petitioner cannot
adequately study and properly analyze the report without the corresponding annexes.
Pertinent and relevant, these could be useful and even necessary to the preparation by
petitioner of its comment, objections and exceptions to the Conservator’s reports and
receiver’s reports.
Regarding copies of the letter and reports of first Conservator, Mr. Basilio Estanislao, to
the Monetary Board and to Central Bank Governor Fernandez (Item No. 2) these appear
relevants as petitioner has asserted that the above-named Conservator had in fact to
resume normal operations of Banco Filipino but then he was thereafter replaced by Mr.
Gilberto Teodoro. The latter and reports could be favorable or adverse to the case of
petitioner but whatever the result may be, petitioner should be allowed to photocopy the
same.
As to the tapes and transcripts of the Monetary Board deliberations on the closure of
Banco Filipino and its meetings on July 27, 1984, and March 22, 1985, (Item No. 1),
respondents contend that "it is obvious from the requirement (Sections 13 and 15 of the
Central Bank Act) that the subject matter (of the deliberations), when resolved . . . shall
be made available to the public but the deliberations themselves are not open to
disclosure but are to be kept in confidence." This Court, however, sees it in a different
light. The deliberations may be confidential but not necessarily absolute and privileged.
There is no specific provision in the Central Bank Act, even in Section 13 and 15 thereof,
which prohibits absolutely the courts from conducting an inquiry on said deliberations
when these are relevant or material to a matter subject of a suit pending before it. The
disclosure is here not intended to obtain information for personal gain. There is no
indication that such disclosure would cause detriment to the government, to the bank or
to third parties. Significantly, it is the bank itself here that is interested in obtaining what
it considers as information useful and indispensably needed by it to support its position
in the matter being inquired to by the court below.
On the other hand, respondents cite Section 21, Rule 130, Rules of Court which
states:cralawnad
"Section 21. Privilege Communications. — The following persons cannot testify as to
matters learned in confidence in the following cases:chanrob1es virtual 1aw library
x x x
(e) A public officer cannot be examined during his term of officer or afterwards, as to
communications made to him in official confidence, when the court finds that the public
interest would suffer by disclosure."
But this privilege, as this Court notes, is intended not for the protection of public officers
but for the protection of public interest (Vogel v. Gruaz, 110 U.S. 311 cited in Moran,
Comments on the Rules of Court, 1980 Ed. Vol. 5, p. 211). Where there is no public interest
that would be prejudiced, this invoked rule will not be applicable.
"The rule that a public officer cannot be examined as to communications made to him in
official confidence does not apply when there is nothing to show that the public interest
would suffer by the disclosure question. . . .", (Agnew v. Agnew, 52 SD 472, cited in Martin
Rules of Court of the Philippines, Third Edition, Vol. 5, p. 199).
"Public interest means more than a mere curiosity; it means something ion which the
public, the community at large, has some pecuniary interest by which their legal rights or
liabilities are affected" (State v. Crocket, 206, p. 816 cited in Words and Phrases, Vol. 35,
In the case at bar, the respondents have not established that public interest would suffer
p. 229).
by the disclosure of the papers and documents sought by petitioner. Considering that
petitioner bank was already closed as of January 25, 1985, any disclosure of the
aforementioned letters, reports, and transcripts at this time pose no danger or peril to
IN VIEW OF ALL THE FOREGOING, the order to produce documents dated February 17,
our economy. Neither will it trigger any bank run nor compromise state secrets.
1986 issued by the court below in S.C.-G.R. NO. 70054, is hereby affirmed, except as to the
Respondent’s reason for their resistance to the order of production are tenuous and
copies of the tapes relative to the Monetary Board deliberations on the closure of Banco
specious. If the respondents public officials acted rightfully and prudently in the
Filipino on January 25, 1985 and its meeting on July 27, 1984, and March 22, 1985 and
performance of their duties, there should be nothing at all that would provoke fear of
only if such tapes are actually no longer available taking into account respondent
disclosure.
Monetary Board’s manifestations that the tape recording of the deliberations of that
Board are, for purposes of economy, used over and over again inasmuch as these tapes
are not required to be kept or stored. (See Respondent’s Reply, dated may 12, 1986; Rollo,
On the contrary, public interests will be served by the disclosure of the documents. Not
Vol. IV, pp. 1288-1289)
only the banks and its employees but also its numerous depositors and creditors are
entitled to be informed as to whether or not there was a valid and legal justification for
the petitioner’s bank closure. It will be well to consider that —
SO ORDERED