G.R. No. 171036, October 17, 2008
ADELA G. RAYMUNDO, EDGARDO R. RAYMUNDO, LOURDES R. RAYMUNDO, TERESITA N. RAYMUNDO, EVELYN R. SANTOS, ZENAIDA N. RAYMUNDO, LUIS N. RAYMUNDO, JR. and LUCITA R. DELOS REYES, petitioners, vs. ERNESTO LUNARIA, ROSALINDA RAMOS and HELEN MENDOZA, respondents.

FACTS

Petitioners, co-owners of a property in Marilao, Bulacan, approached respondent Ernesto Lunaria in May 1996 to find a buyer for their property for ₱60,630,000, promising him a 5% agent’s commission. After respondents found a buyer, Cecilio Hipolito, an “Exclusive Authority to Sell” was executed embodying the agreement. A Deed of Absolute Sale was subsequently registered. On February 14, 1997, a co-owner advised respondents to collect ₱1,196,000 as partial payment of their commission from the escrow bank and to return for the balance. When respondents returned on February 21, 1997, the bank manager had already given the check for the balance to petitioner Lourdes R. Raymundo. Petitioners refused to give the check, claiming nothing more was due as they had distributed the balance among relatives.
Petitioners countered that a subsequent verbal agreement modified the written contract, stipulating that the 5% commission be divided as: 2/5 for the agents (respondents), 2/5 for Lourdes Raymundo for her help in processing documents, paying taxes, and securing court orders, and 1/5 for the buyer, Hipolito, for realty tax payment. Respondents filed an action for collection of a sum of money. The Regional Trial Court ruled in favor of respondents, ordering petitioners to pay the unpaid commission plus damages. The Court of Appeals affirmed with a modification reducing the moral and exemplary damages.

ISSUE

1. Did the Court of Appeals err in applying the parol evidence rule?
2. Did the Court of Appeals err in requiring petitioners to establish the verbal agreement by more than a preponderance of evidence?
3. Did the Court of Appeals err in holding petitioners jointly and severally liable for the broker’s fees?

RULING

1. On the parol evidence rule: The Supreme Court ruled that the parol evidence rule does not apply to the facts of the case. The rule forbids addition to or contradiction of the terms of a written instrument by evidence of prior or contemporaneous agreements. Here, the alleged verbal agreement was claimed to be subsequent to the written “Exclusive Authority to Sell.” Furthermore, the Court found that even if the rule were applied, petitioners’ evidence failed to prove the existence of the subsequent verbal agreement. The absence of any written agreement reflecting the alleged sharing arrangement, the lack of corroborative evidence such as court orders or tax receipts, and the unilateral preparation of a commission worksheet by Lourdes Raymundo undermined petitioners’ claim.
2. On the standard of proof: The Court held that petitioners’ allegation that the appellate court required proof by more than a preponderance of evidence was without merit. The standard in civil cases is preponderance of evidence, meaning evidence that is more convincing and worthy of belief than that offered in opposition. Both the trial and appellate courts correctly found that petitioners’ evidence, primarily the self-serving testimony of Lourdes Raymundo, was insufficient to meet this standard. The failure to present the buyer as a witness or any documentary support for the claimed services further weakened their case.
3. On joint and several liability: The Supreme Court agreed with respondents that petitioners are estopped from questioning the ruling on their joint and several liability. This issue was not raised or assigned as an error in their appeal to the Court of Appeals. The general rule is that an issue adjudicated in a valid final judgment of a competent court can no longer be controverted. Therefore, the ruling on solidary liability stands.
DISPOSITIVE PORTION:
The petition was DENIED for lack of merit. The Decision dated October 10, 2005 and the Resolution dated January 10, 2006 of the Court of Appeals were AFFIRMED. Costs against petitioners.