Burden of Evidence Shifts to Employee When Employer Submits Evidence of Payment

"In repeated occasions, this Court ruled that the debtor has the burden of showing with legal certainty that the obligation has been discharged by payment. To discharge means to extinguish an obligation, and in contract law discharge occurs either when the parties have performed their obligations in the contract, or when an event the conduct of the parties, or the operation of law releases the parties from performing. Thus, a party who alleges that an obligation has been extinguished must prove facts or acts giving rise to the extinction.

The fact of underpayment does not shift the burden of evidence to the plaintiff-herein respondent because partial payment does not extinguish the obligation. Only when the debtor introduces evidence that the obligation has been extinguished does the burden of evidence shift to the creditor who is then under a duty of producing evidence to show why payment does not extinguish the obligation."

(See G & M PHILIPPINES, INC. vs BATOMALAQUE, G. R. No. 151849, June 23, 2005)

RELATED ARTICLES:

• Employee must prove entitlement to overtime pay and premium pay
• Doubts in the parties' evidence should be resolved in favor of the employee
• Employer has the burden of proving payment of employee's benefits

Labor Law: Doubts in parties' evidence should be resolved in favor of employee

"It is a well-settled doctrine, that if doubts exist between the evidence presented by the employer and the employee, the scales of justice must be tilted in favor of the latter. It is a time-honored rule that in controversies between a laborer and his master, doubts reasonably arising from the evidence, or in the interpretation of agreements and writing should be resolved in the former's favor. The policy is to extend the doctrine to a greater number of employees who can avail of the benefits under the law, which is in consonance with the avowed policy of the State to give maximum aid and protection of labor."

(Nicario v. National Labor Relations Commission, G.R. No. 125340, September 17, 1998, 295 SCRA 619, 626-627)

Case Digest in Evidence (Remedial Law): BPI vs. Reyes

BANK OF THE PHILIPPINE ISLANDS vs. JESUSA P. REYES and CONRADO B. REYES

[G.R. No. 157177, February 11, 2008]

FACTS:

On December 7, 1990, respondent Jesusa Reyes together with her daughter, went to BPI Zapote Branch to open an ATM account.

Respondent informed one of petitioners employees, Mr. Capati, that they wanted to open an ATM account for the amount of P200,000.00, P100,000.00 of which shall be withdrawn from her exiting savings account with BPI bank which is account no. 0233-2433-88 and the other P100,000.00 will be given by her in cash.

Capati allegedly made a mistake and prepared a withdrawal slip for P200,00.00 to be withdrawn from her existing savings account with said bank and the respondent believing in good faith that Capati prepared the papers with the correct amount signed the same unaware of the mistakes in figures.

Minutes later after the slips were presented to the teller, Capati returned to where the respondent was seating and informed the latter that the withdrawable balance could not accommodate P200,000.00.

Respondent explained that she is withdrawing the amount of P100,000.00 only and then changed and correct the figure two (2) into one (1) with her signature super-imposed thereto signifying the change, afterwhich the amount of P100,000.00 in cash in two bundles containing 100 pieces of P500.00 peso bill were given to Capati with her daughter Joan witnessing the same. Thereafter Capati prepared a deposit slip for P200,000.00 in the name of resondent Jesusa Reyes with the new account no. 0235-0767-48 and brought the same to the teller's booth.

After a while, he returned and handed to the respondent her duplicate copy of her deposit to account no. 0235-0767-48 reflecting the amount of P200,000.00 with receipt stamp showing December 7, as the date.

Later on, respondent would become aware that her ATM account only contained the amount of P100,000.00 with interest. Hence, she filed an action before the RTC.

Petitioner claimed that there was actually no cash involved with the transactions which happened on December 7, 1990 as contained in the bank’s teller tape.

On August 12, 1994, the RTC issued a Decision upholding the versions of respondents.

Aggrieved, petitioner appealed to the CA which affirmed the RTC decision with modification

ISSUE:

Whether the CA erred in sustaining the RTC's finding that respondent Jesusa made an initial deposit of P200,000.00 in her newly opened Express Teller account on December 7, 1990.

HELD:

It is a basic rule in evidence that each party to a case must prove his own affirmative allegations by the degree of evidence required by law. In civil cases, the party having the burden of proof must establish his case by preponderance of evidence, or that evidence which is of greater weight or is more convincing than that which is in opposition to it. It does not mean absolute truth; rather, it means that the testimony of one side is more believable than that of the other side, and that the probability of truth is on one side than on the other.

For a better perspective on the calibration of the evidence on hand, it must first be stressed that the judge who had heard and seen the witnesses testify was not the same judge who penned the decision. Thus, not having heard the testimonies himself, the trial judge or the appellate court would not be in a better position than this Court to assess the credibility of witnesses on the basis of their demeanor.

Hence, to arrive at the truth, we thoroughly reviewed the transcripts of the witnesses' testimonies and examined the pieces of evidence on record.

After a careful and close examination of the records and evidence presented by the parties, we find that respondents failed to successfully prove by preponderance of evidence that respondent Jesusa made an initial deposit of P200,000.00 in her Express Teller account.

Case Digest in Evidence (Remedial Law): Atlas vs. Commisioner

ATLAS CONSOLIDATED MINING AND DEVELOPMENT CORP. vs. COMMISSIONER OF INTERNAL REVENUE


[G.R. No. 159490, February 18, 2008]

FACTS:

Atlas is a corporation duly organized and existing under Philippine laws engaged in the production of copper concentrates for export.

Atlas applied with the BIR for the issuance of a tax credit certificate or refund under Section 106(b) of the Tax Code.

Atlas then filed a petition for review with the CTA on February 22, 1995 to prevent the running of the prescriptive period under Sec. 230 of the Tax Code.

On October 13, 1997, the CTA rendered a Decision denying Atlas’ claim for tax credit or refund.

Respondent CIR filed his Answer asserting that Atlas has the burden of proving erroneous or illegal payment of the tax being claimed for refund, as claims for refund are strictly construed against the taxpayer

In denying Atlas’ claim for tax credit or refund, the CTA held that Atlas failed to present sufficient evidence to warrant the grant of tax credit or refund for the alleged input taxes paid by Atlas. Relying on Revenue Regulation No. (RR) 3-88 which was issued to implement the then VAT law and list the documents to be submitted in actions for refunds or tax credits of input taxes in export sales, it found that the documents submitted by Atlas did not comply with said regulation. It pointed out that Atlas failed to submit photocopies of export documents, invoices, or receipts evidencing the sale of goods and others.

Atlas timely filed its Motion for Reconsideration of the above decision contending that it relied on Sec. 106 of the Tax Code which merely required proof that the foreign exchange proceeds has been accounted for in accordance with the regulations of the Central Bank of the Philippines. Consequently, Atlas asserted that the documents it presented, coupled with the testimony of its Accounting and Finance Manager sufficiently proved its case. It argued that RR 3-88 was issued for claims for refund of input VAT to be processed by the BIR, that is, for administrative claims, and not for judicial claims as in the present case. Anyhow, Atlas prayed for a re-trial, even as it admitted that it has committed a mistake or excusable negligence when the CTA ruled that RR 3-88 should be the one applied for Atlas to submit the basis required under the regulation.

On Atlas’ appeal, the CA denied and dismissed Atlas’ petition on the ground of insufficiency of evidence to support Atlas’ action for tax credit or refund.

ISSUE: Whether Atlas has sufficiently proven entitlement to a tax credit or refund.

HELD:

No.

The Rules of Court, which is suppletory in quasi-judicial proceedings, particularly Sec. 349 of Rule 132, Revised Rules on Evidence, is clear that no evidence which has not been formally offered shall be considered. Thus, where the pertinent invoices or receipts purportedly evidencing the VAT paid by Atlas were not submitted, the courts a quo evidently could not determine the veracity of the input VAT Atlas has paid. Moreover, when Atlas likewise failed to submit pertinent export documents to prove actual export sales with due certification from accredited banks on the export proceeds in foreign currency with the corresponding conversion rate into Philippine currency, the courts a quo likewise could not determine the veracity of the export sales as indicated in Atlas’ amended VAT return.

It must be noted that the most competent evidence must be adduced and presented to prove the allegations in a complaint, petition, or protest before a judicial court. And where the best evidence cannot be submitted, secondary evidence may be presented. In the instant case, the pertinent documents which are the best pieces of evidence were not presented.

Case Digest in Evidence (Remedial Law): Silot vs. De la Rosa

GREGORIO SILOT, JR. vs. ESTRELLA DE LA ROSA

[G.R. No. 159240. February 4, 2008]

FACTS:
Petitioner Silot and respondent de la Rosa entered into a contract for the construction of a dormitory-apartment building. They expressly agreed that Silot shall supply the labor and de la Rosa shall pay 33% of the total value of the materials purchased for the project. Upon turnover of the completed structure, the total cost of materials actually purchased was P2,504,469.65, 33% of which is P826,474.98. Silot required de la Rosa to pay a total of P1,018,000.00, or P191,525.02 more than the amount due. Through her son-in-law, de la Rosa confronted Silot about the overpayment but the latter refused to return the overpayment. After her repeated demands fell on deaf ears, de la Rosa filed a suit against Silot. Silot, in retaliation, sued de la Rosa for insufficient payment, claiming that he was supposed to receive P1,281,872.404 but was only paid P1,008,000.00, thus still leaving a balance of P273,872.40.

During trial, however, Atty. San Jose, counsel for Silot, dispensed with the testimony of Ariel Goingo, a witness for de la Rosa. Atty. San Jose admitted Goingo's proposed testimony to the effect that in consideration of the 33% as mentioned in the contract, all the material supplies during the making of the additional works mentioned were already accounted for; that Silot was paid for all works that were performed as well as all materials supplied; that the total sum was P2,504,469.65, so that 33% of which is only P826,474.98; that de la Rosa paid the amount of P1,018,000.00; hence, there was an excess payment of P191,525.02; and that de la Rosa never received any demand from nor was she confronted by Silot regarding an alleged balance.

Consequently, after trial, the RTC ruled in favor of de la Rosa and ordered Silot to return the overpaid amount. On appeal, the Court of Appeals affirmed the decision of the lower court.

ISSUE:
Whether the admission by Atty. San Jose, counsel of petitioner Silot, constituted judicial admission of respondent's evidence.

HELD:
Yes.
Moreover, well-entrenched is the rule that the client is bound by the mistakes arising from negligence of his own counsel. The only exception to this rule is, as the Court of Appeals itself cited in its decision, when the negligence is so gross that the client is deprived of his day in court.

In our considered view, however, that exception does not find any application in this case. As the records would plainly show, Silot was not deprived of his day in court. Also, as the appellate court observed, he could have introduced evidence, testimonial or otherwise, in order to controvert or correct the admission made by his counsel. Said the appellate court:

…As gleaned from the records, defendant-appellant Silot was not deprived of his day in court. He was given every opportunity to be heard through his pleadings and manifestations. He was also presented in open court to testify. As quoted earlier, Atty. Terbio, counsel for plaintiff-appellee de la Rosa, even repeatedly asked Atty. San Jose, defendant-appellant Silot's counsel, if he would admit the purpose for which the witness Ariel Goingo will testify to dispense with his testimony, and Atty. San Jose repeatedly answered that "We will admit that." And when asked by the judge if he will admit it, he answered that they will admit P2,504,000.00.

More importantly, Silot's counsel clearly made admissions of the content of the testimony of witness Goingo, whose presentation was dispensed with. In People v. Hernandez, we held that admissions made for the purpose of dispensing with proof of some facts are in the nature of judicial admissions, to wit:

A stipulation of facts entered into by the prosecution and defense counsel during trial in open court is automatically reduced into writing and contained in the official transcript of the proceedings had in court. The conformity of the accused in the form of his signature affixed thereto is unnecessary in view of the fact that: "[…] an attorney who is employed to manage a party's conduct of a lawsuit […] has prima facie authority to make relevant admissions by pleadings, by oral or written stipulation, […] which unless allowed to be withdrawn are conclusive." (Italics supplied.) In fact, "judicial admissions are frequently those of counsel or of the attorney of record, who is, for the purpose of the trial, the agent of his client. When such admissions are made […] for the purpose of dispensing with proof of some fact, […] they bind the client, whether made during, or even after, the trial.

Worth stressing, in this connection, judicial admissions do not require proof and may not be contradicted in the absence of a prior showing that the admissions had been made through palpable mistake.

Furthermore, in the case of Toh v. Court of Appeals, this Court emphasized the consequence of admitting and dispensing with the testimony of the proposed witness, thus:


The Court sees no cogent reason why the said witness should be examined any further since his testimony as summarized in the offer made by counsel was expressly admitted by opposing counsel. With the said admission, the testimony of said witness is uncontroverted and even admitted as fact by opposing counsel.…

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.

Case Digest in Evidence (Remedial Law): SEAOIL Petroleum Corp. vs. AUTOCORP

SEAOIL PETROLEUM CORPORATION VS. AUTOCORP GROUP AND PAUL Y. RODRIGUEZ
G.R. No. 164326, October 17, 2008
FACTS:Petitioner Seaoil Petroleum Corporation purchased one unit of ROBEX 200 LC Excavator, Model 1994 from respondent Autocorp Group. The sales agreement was embodied in the Vehicle Sales Invoice No. A-0209 and Vehicle Sales Confirmation No. 258. Seaoil issued 12 checks as payment therefor; however 10 checks were not honored by the bank since Seaoil requested that payment be stopped. Autocorp filed a complaint for recovery of personal property with damages and replevin in the Regional Trial Court.

Seaoil claims that Seaoil and Autocorp were only utilized as conduits to settle the obligation of one foreign entity named Uniline Asia, in favor of another foreign entity, Focus Point International, Incorporated. The real transaction is that Uniline, through Rodriguez, owed money to Focus. In lieu of payment, Uniline instead agreed to convey the excavator to Focus. This was to be paid by checks issued by Seaoil but which in turn were to be funded by checks issued by Uniline.

Petitioner Seaoil in sum alleges that the written agreement failed to express the true intent and agreement of the parties, thus parol evidence is admissible.

ISSUE:

Whether or not parol evidence rule is applicable in this case.

HELD:

No. Although parol evidence is admissible to explain the meaning of a contract, it cannot serve the purpose of incorporating into the contract additional contemporaneous conditions which are not mentioned at all in the writing unless there has been fraud or mistake. Evidence of a prior or contemporaneous verbal agreement is generally not admissible to vary, contradict or defeat the operation of a valid contract.

The Vehicle Sales Invoice is the best evidence of the transaction. The terms of the subject sales invoice are clear. They show that Autocorp sold to Seaoil one unit Robex 200 LC Excavator paid for by checks issued by one Romeo Valera.