CASE No.

Lomides Aludos, Deceased, Substituted by Flora Aludos vs. Johnny M. Suerte

GR. No. 165285, June 18, 2012

Doctrine (Offer of Evidence):

The CA has already rejected the evidentiary value of the May 1, 1985 lease contract between
the Baguio City Government and Lomises, as it was not formally offered in evidence before the
RTC; in fact, the CA admonished Lomises’ lawyer, Atty. Lockey, for making it appear that it
was part of the records of the case.

Under Sec. 34, Rule 134 of the Rules of Court, the court shall consider no evidence which has
not been formally offered. “The offer of evidence is necessary because it is the duty of the
court to rest its findings of fact and its judgment only and strictly upon the evidence offered by
the parties. Unless and until admitted by the court in evidence for the purpose or purposes for
which such document is offered, the same is merely a scrap of paper barren of probative
weight.

Facts:

In this case, the respondent Johnny M. Suerte filed an action for specific performance and
damages against the petitioner Lomides Aludos; Johnny seeks the execution of the contract of
sale between him and the petitioner. Johnny alleges that the petitioner and him executed a
contract whereby the petitioner agreed to sell his Market Stall (with improvements) and lot in
the Baguio Public Market. However, the petitioner contends that the contract was actually for a
loan, with the market stall and lot used as a security for the loan; in fact, the petitioner already
paid the alleged loan amounting to Php 68,000.00 to the respondent.

The petitioner argues further that there can never be a valid contract of sale over the market
stall/lot as well as the improvements therein, because the petitioner does not own such market
lot and he is just a lessee, with the Baguio Government as owner of the lot. As evidence, the
petitioner presented Exhibit “A” (lease contract between the petitioner and the Baguio City
Government) which shows the agreement of lease between petitioner and the Baguio City
Government, and also provides that “all improvements introduced shall ipso facto become
properties of the City of Baguio.”.

However, the CA found that the said “Exhibit A” was not actually the governing lease contract
between the petitioner and the Baguio City Government. In fact, the said exhibit was merely a
permit issued by the City Treasurer in favor of the Lomises. The actual contract of lease dated
May 1, 1985 was never formally offered in evidence before the RTC and could thus not be
considered pursuant to the rules of evidence. Thus, the CA ruled that while the sale of the
market lot can not be valid as this is the government’s property, the market stall and its
improvements can be a valid subject of the contract of sale as this is the personal property of
the petitioner. The petitioner now questions the said resolution demanding him to sell his
market stall and improvements to the respondent.
Issue:

Whether or not there is a valid contract of sale regarding the Market Stall and its
improvements?

Ruling:

The Court ruled that there is indeed a valid contract of sale regarding the Market Stall and its
improvements, because these were personal properties of the petitioner. The actual contract
of lease (dated May 1, 1985) was never formally offered in evidence. Allegedly, the contract
could have supported petitioner’s claim that the market stall and improvements cannot be a
valid subject of sale due to the provision in the contract saying “all improvements introduced
shall ipso facto become properties of the City of Baguio.”. However, since it was not formally
offered in evidence, it cannot be considered by the Court. Therefore the Court affirms the
ruling of the CA and remands the case to the RTC for the determination of the value of the
improvements on the market stall of the petitioner and for the parties to proceed with the
contract of sale therein.