Case Digest in Evidence (Remedial Law): Cuenco vs. Talisay Tourist Sports Complex, Inc.

JESUS CUENCO vs. TALISAY TOURIST SPORTS COMPLEX, INC. and MATIAS B. AZNAR III

[G.R. No. 174154, October 17, 2008]

FACTS:
Petitioner leased from respondent a property to be operated as a cockpit. Upon expiration of the contract, respondent company conducted a public bidding for the lease of the property. Petitioner participated in the bidding. The lease was eventually awarded to another bidder. Thereafter, petitioner formally demanded, through several demand letters, for the return of his deposit in the sum of P500, 000.00. It, however, all remained unheeded.

Thus, petitioner filed a Complaint for sum of money maintaining that respondents acted in bad faith in withholding the amount of the deposit without any justifiable reason. In their Answer, respondents countered that petitioner caused physical damage to the leased premises and the cost of repair and replacement of materials amounted to more than P500,000.00.

The RTC issued a Pre-trial Order in which respondent admitted that there is no inventory of damages. The respondents later offered an inventory which was admitted by the said trial court. The RTC ruled favorably for the petitioner. The CA reversed said decision.

ISSUES:
Whether a judicial admission is conclusive and binding upon a party making the admission.

HELD:
Yes.
Obviously, it was on Coronado's testimony, as well as on the documentary evidence of an alleged property inventory conducted on June 4, 1998, that the CA based its conclusion that the amount of damage sustained by the leased premises while in the possession of petitioner exceeded the amount of petitioner's deposit. This contradicts the judicial admission made by respondents' counsel which should have been binding on the respondents.

Section 4, Rule 129 of the Rules of Court provides:
SEC. 4. Judicial admissions. - An admission, verbal or written, made by a party in the course of the proceedings in the same case, does not require proof. The admission may be contradicted only by a showing that it was made through palpable mistake or that no such admission was made.

A party may make judicial admissions in (1) the pleadings, (2) during the trial, by verbal or written manifestations or stipulations, or (3) in other stages of the judicial proceeding. The stipulation of facts at the pre-trial of a case constitutes judicial admissions. The veracity of judicial admissions require no further proof and may be controverted only upon a clear showing that the admissions were made through palpable mistake or that no admissions were made. Thus, the admissions of parties during the pre-trial, as embodied in the pre-trial order, are binding and conclusive upon them.

Respondents did not deny the admission made by their counsel, neither did they claim that the same was made through palpable mistake. As such, the stipulation of facts is incontrovertible and may be relied upon by the courts. The pre-trial forms part of the proceedings and matters dealt therein may not be brushed aside in the process of decision-making. Otherwise, the real essence of compulsory pre-trial would be rendered inconsequential and worthless. Furthermore, an act performed by counsel within the scope of a "general or implied authority" is
regarded as an act of the client which renders respondents in estoppel. By estoppel is meant that an admission or representation is conclusive upon the person making it and cannot be denied or disproved as against the person relying thereon.

Thus, respondents are bound by the admissions made by their counsel at the pre-trial. Accordingly, the CA committed an error when it gave ample evidentiary weight to respondents' evidence contradictory to the judicial admission.