G.R. No. 159240 . February 4, 2008.
GREGORIO SILOT, JR., petitioner, vs. ESTRELLA DE LA ROSA, respondent.

FACTS

On January 19, 1996, petitioner Gregorio Silot, Jr. and respondent Estrella de la Rosa entered into a construction contract for a dormitory-apartment building in Naga City. They expressly agreed that Silot would supply the labor and de la Rosa would pay 33% of the total cost of materials purchased. Upon completion and turnover in February 1997, the total cost of materials was P2,504,469.65, making de la Rosa’s 33% share P826,474.98. However, Silot required de la Rosa to pay P1,018,000.00, resulting in an overpayment of P191,525.02. After repeated demands for the return of the overpayment were refused, de la Rosa filed a suit against Silot. In retaliation, Silot sued de la Rosa for alleged insufficient payment, claiming a balance of P273,872.40. The two cases were consolidated by the Regional Trial Court (RTC) of Naga City, Branch 61.
During trial, Atty. San Jose, counsel for Silot, dispensed with the testimony of de la Rosa’s witness, Ariel Goingo, by admitting the purpose of his proposed testimony. The admission covered the facts that: all material supplies for additional works were accounted for; Silot was paid for all works and materials; the total material cost was P2,504,469.65 (33% of which is P826,474.98); de la Rosa paid P1,018,000.00, resulting in an excess payment of P191,525.02; and de la Rosa never received any demand from Silot regarding an alleged balance.
The RTC ruled in favor of de la Rosa, ordering Silot to return the overpaid amount of P191,525.02, pay attorney’s fees of P100,000.00, and nominal damages of P50,000.00, while dismissing Silot’s case. The Court of Appeals affirmed the RTC decision with modification, deleting the award for nominal damages and reducing attorney’s fees to P20,000.00. Silot filed the instant petition.

ISSUE

1. Whether the admission made by petitioner’s counsel, Atty. San Jose, regarding the testimony of witness Ariel Goingo constituted a judicial admission binding on the petitioner.
2. Whether the appellate court erred in ordering petitioner to return the amount of P191,525.02 to respondent.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Decision of the Court of Appeals.
1. On the Judicial Admission: The Court held that the admission made by petitioner’s counsel constituted a judicial admission that is conclusive upon the petitioner and does not require proof. Citing People v. Hernandez, the Court ruled that an attorney has prima facie authority to make relevant admissions by stipulation during trial, which are binding on the client. Judicial admissions may only be contradicted by showing a palpable mistake or that no such admission was made, which petitioner failed to establish. The Court emphasized that petitioner was not deprived of his day in court, as he had the opportunity to present evidence to controvert the admission but did not do so. The admission dispensed with the need for Goingo’s testimony and rendered the admitted facts uncontroverted.
2. On the Return of Overpayment: The Court found no error in the appellate court’s order for petitioner to return P191,525.02 to respondent. Petitioner’s claim of insufficient payment and unjust enrichment was belied by his own counsel’s judicial admission, which established the total material cost, the correct 33% share, the amount paid, and the resulting overpayment. The admission conclusively settled the factual basis for respondent’s claim.
Dispositive Portion: Petitioner Gregorio Silot, Jr. is ordered to return the amount of P191,525.02 to respondent Estrella de la Rosa and to pay P20,000.00 as attorney’s fees. Costs against petitioner.