G.R. No. L-18820, December 29, 1962
Hadji Abubakar Tan vs. Eduardo Gua Tian Ho

FACTS

Plaintiff Hadji Abubakar Tan filed a complaint alleging two causes of action. The first cause detailed a contract of sale where Tan paid P5,000.00 to defendant Eduardo Gua Tian Ho for five tons of sea sponges. Upon defendant’s failure to deliver the full quantity, Tan rescinded the contract. Defendant returned P2,000.00 and executed a promissory note for the remaining P3,000.00, which he subsequently failed to pay. The second cause sought unrealized profits and attorney’s fees. In his answer, defendant admitted receiving the P5,000.00, executing the note for P3,000.00, and failing to pay it. However, he denied that his failure to deliver caused the rescission.
The defendant asserted affirmative defenses, claiming Tan rescinded because his own buyers backed out, and that Tan was willing to compromise by deducting defendant’s incurred expenses from any refund. Defendant also interposed a counterclaim for expenses and damages. Plaintiff moved for judgment on the pleadings on the first cause, arguing the material allegations were admitted. The trial court granted the motion, ordering defendant to pay P3,000.00 with interest and dismissing the second cause and the counterclaim.

ISSUE

Whether the trial court correctly rendered a judgment on the pleadings.

RULING

No, the trial court erred. Judgment on the pleadings under Section 10, Rule 35 of the Rules of Court is proper only when an answer fails to tender an issue or admits all the material allegations of the complaint. Here, the defendant’s answer did tender genuine issues of fact. While he admitted the existence of the contract, the payment, the note, and his non-payment, he specifically denied the crucial allegation that his breach (failure to deliver) was the cause of the rescission.
His affirmative defenses presented a different factual narrative: that plaintiff rescinded for an independent reason (his buyers’ withdrawal) and was amenable to a settlement accounting for defendant’s expenses. These defenses, if proven, could affect the plaintiff’s right to a full refund of the P3,000.00 without offset. Therefore, the answer did not constitute a clear admission of all material facts establishing an unequivocal obligation to pay the specific sum. The existence and extent of the debt required clarification through evidence, precluding judgment on the pleadings. The order was reversed and the case remanded for trial.