G.R. No. L-12357, December 29, 1959
NATIONAL MARKETING CORPORATION, plaintiff-appellee, vs. JOSE G. DE CASTRO, defendant-appellant.

FACTS

On June 7, 1949, defendant-appellant Jose G. de Castro bought two tractors from the Philippine Relief and Trade Rehabilitation Administration (PRATRA) for P38,000.00, making a down payment of P15,200.00 and leaving a balance of P22,800.00. To secure this balance, he executed a promissory note for said amount. He failed to pay according to the note’s terms. PRATRA’s successor-in-interest, the Price Stabilization Corporation (PRISCO), and later the National Marketing Corporation (NAMARCO), sent demand letters. De Castro’s wife responded, admitting the indebtedness and requesting extensions due to financial difficulties. As of July 11, 1956, the total obligation (principal and interest) was P34,027.71, of which only P3,480.00 had been paid, leaving a balance of P30,547.71. The promissory note stipulated an additional 10% of the total due as attorney’s fees and costs of collection in case of default. At trial, after the plaintiff presented its evidence, the defendant failed to appear on the scheduled date for presenting his evidence. The trial court granted several extensions for the defendant to attempt an amicable settlement, but these efforts failed as the plaintiff’s board rejected the defendant’s offers. The court eventually considered the case submitted for decision based on the plaintiff’s evidence alone and rendered judgment against the defendant. The defendant filed a motion for new trial, claiming he was deprived of the opportunity to present evidence due to heavy traffic, but this motion was denied as it lacked a required affidavit of merit.

ISSUE

Whether the trial court erred in rendering judgment based solely on the plaintiff’s evidence and in denying the defendant’s motion for a new trial.

RULING

The Supreme Court affirmed the trial court’s judgment. The Court held that the defendant was not deprived of his day in court. The trial court had afforded him ample opportunity to present his evidence and had granted multiple extensions for amicable settlement negotiations, which ultimately proved futile. The motion for new trial was correctly denied for failure to comply with the Rules of Court, specifically the requirement of an affidavit of merit. Furthermore, the Court noted that in his answer to the complaint, the defendant’s denial of the material allegations was not specific but was a general denial, which, under the rules of pleading, results in those material averments being deemed admitted. Therefore, judgment upon the pleadings or based on the plaintiff’s evidence was proper. The appellant was ordered to pay the appellee the sum of P30,547.71 with legal interest from the filing of the complaint, plus 10% of the total amount due as attorney’s fees and costs of collection, and the costs of suit.