G.R. No. L-18682 June 30, 1965
NICOLAS DE LOS SANTOS, petitioner, vs. THE COURT OF APPEALS (Sixth Division Special), SANTIAGO K. BAUTISTA and EDUARDO MENDIGORIA, respondents.

FACTS

In 1949, respondent Eduardo Mendigoria executed a chattel mortgage over a house he owned to secure a loan from petitioner Nicolas de los Santos, payable on or before July 19, 1949. On July 11, 1949, Mendigoria sold the house to his co-respondent, Santiago K. Bautista. In 1958, after Mendigoria received a formal demand for payment and notice of extrajudicial foreclosure from De los Santos, Mendigoria and Bautista filed an action in the Court of First Instance of Manila to enjoin the foreclosure sale (Civil Case No. 35670), alleging the loan had been paid despite the lack of a receipt. The court issued a preliminary injunction. Defendant De los Santos moved to dissolve the writ and dismiss the complaint, which was denied. He then filed an answer with a counterclaim for damages, alleging the suit was malicious and groundless. Plaintiffs were declared in default on the counterclaim for failure to answer. After plaintiffs presented their evidence, defendant filed a motion to dismiss on the ground of insufficiency of evidence. Plaintiffs opposed. On December 27, 1958, the court denied the motion and permanently enjoined the foreclosure sale, ruling that since defendant did not reserve his right to present evidence if his demurrer to the evidence was overruled, he must abide by the result. Defendant’s motion for reconsideration, with an alternative prayer to present evidence, was denied. The Court of Appeals affirmed the trial court’s judgment. Petitioner elevated the case to the Supreme Court via certiorari.

ISSUE

Whether or not petitioner, as defendant below, was correctly denied the opportunity to present his evidence after his motion to dismiss (demurrer to the evidence) was overruled.

RULING

Yes. The Supreme Court affirmed the judgment of the Court of Appeals. The Court held that under the jurisprudence prevailing at the time (prior to the 1964 Revised Rules of Court), a defendant who files a demurrer to the plaintiff’s evidence without any reservation in effect submits the case for decision. If the demurrer is overruled and the decision is adverse, he cannot claim, as a matter of right, that the decision be vacated to allow him to adduce his own evidence. The Court found the case analogous to Municipality of Abucay vs. Abucay Plantation Co., which established that when a defendant moves to dismiss on the ground of insufficiency of plaintiff’s evidence without reserving the right to present evidence, he loses that right, and the court may decide the case on the merits based only on the plaintiff’s evidence. The Court clarified that the cases cited by petitioner (Madrid vs. Mañalac, Guido vs. Castelo) were inapplicable as they involved express reservations by the defendant, which was absent here. The Court noted that the issue is now expressly governed by Rule 35, Section 1 of the Revised Rules of Court, effective January 1, 1964.