G.R. No. 172825; October 11, 2012
SPOUSES MINIANO B. DELA CRUZ and LETA L. DELA CRUZ, Petitioners, vs. ANA MARIE CONCEPCION, Respondent.

FACTS

Petitioners-spouses Dela Cruz and respondent Ana Marie Concepcion entered into a Contract to Sell for a house and lot for P2,000,000.00. The contract stipulated payment terms including a down payment and a balance payable in installments with interest and penalties. Respondent paid a total of P2,000,000.00, which included the principal price, through several payments, the last being a P500,000.00 check. Before issuing this final check, respondent informed petitioners that her accountant computed her remaining obligation for interests and penalties at only P200,000.00. Petitioners agreed, stating, “if P200,000.00 is the correct balance, it is okay with us.” The title to the property was subsequently transferred to respondent.
Later, petitioners demanded payment of P209,000.00, and then a larger sum, claiming it was the correct computation of respondent’s liabilities for interests and penalties. Respondent refused, contending her obligation was settled upon payment of the P200,000.00, which she claimed to have paid to petitioners’ representative, Adoracion Losloso. This prompted petitioners to file a Complaint for Sum of Money with Damages.

ISSUE

Whether the Court of Appeals erred in affirming the dismissal of petitioners’ complaint and in ruling that respondent’s obligation was limited to and extinguished by the payment of P200,000.00.

RULING

The Supreme Court denied the petition and affirmed the CA’s decision. The core legal logic rests on the principle of judicial admission and the nature of the parties’ agreement. Respondent, in her Answer, judicially admitted an outstanding obligation of P200,000.00, which petitioners initially confirmed. A judicial admission requires no proof and is binding on the party making it. Petitioners’ subsequent attempt to claim a higher amount based on a different computation contradicted their earlier express agreement. The Court held that the parties effectively novated their original contract by mutually agreeing to fix the remaining balance for interests and penalties at P200,000.00, superseding the earlier complex payment schedule.
Furthermore, the Court found that respondent presented a receipt indicating payment of this P200,000.00 to Losloso, whom petitioners failed to disown as their agent. Petitioners’ failure to properly present and offer their evidence to substantiate their new, larger claim was fatal to their case. The RTC and CA correctly refused to compute penalties and interests based on the original terms since the parties had already agreed on a different, settled amount. Thus, respondent’s obligation was correctly limited to the P200,000.00, and evidence suggested its payment.