SCC Chemicals Corp vs CA.docx

SCC Chemicals Corp. VS CA 353 SCRA 70 (2001)

Facts:

On December 13, 1983 petitioner SCC Chemical Corporation (SCC) obtained a loan through its chairman private respondent Danilo Arrieta and vice president, Pablo Bermundo from State Investment House Inc. (SIHI) in the amount of Php 129,824.48. Private respondents executed a Comprehensive Surety Agreement binding themselves jointly and severally to pay the obligation on maturity date. SCC failed to pay the loan and despite demands, no payment was made. SIHI filed a case of sum of money against SCC with a prayer for preliminary attachment against private respondents. SCC contends that SIHI has no cause of action because the promissory note was null, void and no binding effect. During the pre-trial stage, no settlement was reached however, stipulation of facts was agreed upon, thus, the case proceeded to trial. SIHI presented one witness to prove its claim. The cross- examination of the said witness was postponed despite being calendared many times. SCC or its counsel failed to appear several times, thus, the RTC declared SCC to have waived its right to cross-examine the witness of SIHI and the case was deemed submitted for decision. SCC elevated the case to CA and contended that SIHI had failed to show, by a preponderance of evidence, that the latter had a case against it; and that the witness presented to prove its claim was incompetent because he had no personal knowledge of the transaction. SCC also contended that no proof was shown of the genuineness of the signatures in the documentary exhibits presented as evidence and that these signatures were neither marked nor offered in evidence by SIHI. The appellate court affirmed the RTC’s decision. Hence, this petition. ISSUE:

1. Whether or not judicial admission requires proof. 2. Whether the testimony of the witness is a hearsay evidence and thus inadmissible.

RULING:

1. No. A judicial admission requires no proof. Petitioner’s admission as to the execution of the promissory notes by it through private respondents Arrieta and Bermundo at pre-trial sufficed to settle the question of the genuineness of the signatures. The admission having been made in stipulation of facts at pre-trial by the parties, it must be treated as a judicial admission. Under Sec. 4, Rule 129 of the ROC. 2. As a rule, hearsay evidence is excluded and carries no probative value. However, the rule does admit of an exception. Where a party failed to object to hearsay evidence, then the same is admissible. The rationale for this exception is to be found in the right of a litigant to cross-examine. It is settled that it is the opportunity to cross-examine which negates the claim that the matters testified to by a witness are hearsay. However, the right to cross-examine may be waived. The repeated failure of a party to cross-examine the witness is an implied waiver of such right.