G.R. No. 236920 , February 03, 2021
Gemma A. Ridao, Petitioner, vs. Handmade Credit and Loans, Inc., represented by Teofilo V. Manipon, Respondent.

FACTS

Petitioner Gemma A. Ridao obtained a $4,000.00 loan from respondent Handmade Credit and Loans, Inc., represented by her brother-in-law Teofilo Manipon, on February 20, 2004, evidenced by a promissory note. On August 24, 2004, she allegedly obtained an additional loan increasing her obligation to $6,167.00, evidenced by the same promissory note number, and a separate ₱40,000.00 loan. Both loans carried a 4% monthly interest. After Ridao failed to pay, Handmade Credit filed a collection case. Ridao admitted the $4,000.00 loan but claimed it was fully paid through her husband, Avelino, as evidenced by a ledger showing payments totaling $4,300.00, with some entries acknowledged by Teofilo and his daughter Zoraida. She denied the additional $6,167.00 and ₱40,000.00 loans, alleging the promissory notes were materially altered and signatures forged. During trial, Teofilo admitted altering the promissory note dates without Ridao’s knowledge and acknowledged receiving only $1,100.00 in payments as per the ledger, disputing the remaining entries due to lack of serial numbers for the dollar bills. The Regional Trial Court dismissed the complaint, finding the ledger admissible and the 4% interest unconscionable, and declared the ₱40,000.00 loan void. The Court of Appeals modified the decision, declaring both promissory notes void due to material alterations but ordering Ridao to pay $3,200.00, representing the unpaid balance of the admitted $4,300.00 loan, as it found her proof of full payment insufficient.

ISSUE

Whether the appellate court committed reversible error in ordering Ridao to pay the sum of $3,200.00 or its peso equivalent, with interest.

RULING

The Supreme Court granted the petition and dismissed the complaint. The Court held that the promissory notes were void due to material alterations made without Ridao’s consent, as admitted by Teofilo, and thus could not be a source of obligation. Regarding the admitted $4,300.00 loan, the Court found that Handmade Credit failed to specifically deny under oath the genuineness and due execution of the ledger presented by Ridao, which detailed the payments. Under Section 8, Rule 8 of the Rules of Court, such failure results in the implied admission of the document’s authenticity. The ledger entries, including those for the disputed payments, were made in the regular course of business, and Teofilo admitted that receipts were not issued because the ledger itself served as an acknowledgment. Consequently, Handmade Credit did not present sufficient evidence to overcome the presumption of full payment established by the ledger. Therefore, Ridao’s obligation was deemed fully satisfied.