G.R. No. 181676, June 11, 2014
ASIAN CONSTRUCTION AND DEVELOPMENT CORPORATION, Petitioner, v. SANNAEDLE CO., LTD., Respondent.
D E C I S I O N
In claiming that the Answer of the [petitioner] failed to tender an issue, [respondent] argued that the present action is for collection of the amount of US$615,620.33 with interest at the rate of 12% per annum, which amount represents the balance of the payment under the Memorandum of Agreement, Annex B of the Complaint entered into between [respondent] and [petitioner] which was not denied in the Answer. [Respondent] further claimed that in a letter dated February 2, 2000, Annex C of the Complaint, it demanded payment of the said amount of US$615,620.33 and in reply thereto, [petitioner] stated in part –“We refer to your letter dated February 2, 2000 regarding the US$2,635,333.00 balance unpaid claim of SANNAEDLE.
x x x x x x x x x
2. Phase I Contract
While we recognize being obligated to this amount, we do not have at the moment the capability to pay it. This is because our financial position has been severely affected by the freezing of the government of all our collectibles on EXPO projects including the P80M (approx. US$2.0M) from DPWH intended to pay the cost increment of reverting back the use of Sannaedle in Phase I.
x x x x x x x x x
The partial amount of about US$1.4M paid by ASIAKONSTRUKT to Sannaedle in excess of its allocated budget of US$1.745M actually came from its own source and initiatives. This effort made by ASIAKONSTRUKT significantly reduced the balance due Sannaedle to only US$615,620.33.
x x x x x x x x x
The Court notes that in the Answer with Counterclaim of the [petitioner], the execution of the Memorandum of Agreement, Annex B of the Complaint was admitted (paragraph 13, Answer). Further, it did not deny specifically the claim of the [respondent] of being entitled to collect the said amount of US$615,620.33.6cralawredx x x x
WHEREFORE, judgment is rendered in favor [of] the [respondent] and [petitioner] is ordered to pay [respondent] the amount of US $615,620.33 with interest thereon at the rate of 12% per annum from February 2, 2000 until fully paid.
No pronouncement as to costs.
WHEREFORE, the instant appeal is DISMISSED. The judgment of the Regional Trial Court of Makati City, Branch 138, dated October 6, 2000, is hereby AFFIRMED.
Costs against the [petitioner].
Sec. 1. Judgment on the pleadings. – Where an answer fails to tender an issue, or otherwise admits the material allegations of the adverse party’s pleading, the court may, on motion of that party, direct judgment on such pleading. However, in actions for declaration of nullity or annulment of marriage or for legal separation, the material facts alleged in the complaint shall always be proved.10
3. The [Petitioner] ASIAN CONSTRUCTION AND DEVELOPMENT CORPORATION (“ASIAKONSTRUKT” for brevity), is a corporation duly incorporated under the laws of the Philippines, with capacity to sue and be sued, and with business address at the Second Floor, Union Ajinomoto Building, Sen. Gil Puyat Avenue, Makati City, and within the jurisdiction of this Honorable Court; and where it may be served with summons and other court processes of this Honorable Court,
4. That the [respondent] and the [petitioner] entered into a Memorandum of Agreement in Makati City, within the jurisdiction of this Honorable Court, dated February 17, 1998, wherein the [Petitioner] corporation agreed with and ordered the herein [Respondent], as Contractor, to design and install INSUPANEL SYSTEMS at various pavilions, etc. at expo projects site; and specifically for the Phase I project at an agreed amount of US$3,745,287.94 (Par. 2.1). A xerox copy of this Memorandum of Agreement dated February 17, 1998 between [Respondent] and [Petitioner] consisting of six (6) pages, is attached hereto as Annex B and made an integral part hereof.
5. That pursuant to this Memorandum of Agreement (Exhibit B) and contract price of US$3,745,287.94, various payments have been made by [Petitioner] Corporation on this Phase I project totaling US$3,129,667.32, thus leaving a balance of US$615,620.33.18
The [respondent’s] cause of action for collection of Sum of Money is founded mainly on the Memorandum of Agreement validly executed by both parties.
First, the allegations in the [petitioner’s] Answer do not make out a specific denial that a Memorandum of Agreement was perfected between the parties. Second, the [respondent] does not contest the due execution and/or genuineness of said Memorandum of Agreement. In fact, paragraph 13 of the Answer categorically admits paragraphs 4 and 5 of the Complaint.
In its Answer, the [petitioner] offered the following defenses, to wit:ChanRoblesVirtualawlibrary19. The complaint should be dismissed on the ground that [respondent’s] certification of non-forum shopping is defective. Rule 7, Section 5 of the 1997 Revised Rules of Civil Procedure … xxx xxx xxxIn essence, the [petitioner] justifies its refusal to tender payment of the balance of US$615,620.33 to the [respondent], to the failure of the First Centennial Clark Corporation (FCCC) to comply with its obligations to ASIAKONSTRUKT which [it] characterizes as a fortuitous event.
22. [Respondent] has no legal capacity to sue, as it is a foreign corporation doing business in the Philippines without a valid license. xxx xxx xxx
27. The unexpected default of FCCC on its obligations to [petitioner] on account of the Senate Blue Ribbon Committee investigation was a fortuitous event which suspended, if not extinguished [petitioner’s] obligation to FCCC.
The defenses raised by [petitioner] cannot prevent the [respondent] from seeking the collection of the amount of US$615,620.33. The express terms of the Memorandum of Agreement, the genuineness and due execution of which are not denied by the [petitioner]. It cannot assert the said defenses in order to resist the [respondent’s] claim for the aforesaid sum of money, especially where it has been sufficiently shown by the allegations of the Complaint and the Answer that the [petitioner] is clearly liable for the payment thereof.19
* Designated Acting Member, per Special Order No. 1691 dated May 22, 2014.
1 Penned by Associate Justice Amelita G. Tolentino, with Associate Justices Juan Q. Enriquez, Jr. and Vicente S. E. Veloso, concurring; rollo, pp. 23-33.
2 Id. at 35-37.
3Id. at 39-45.
4Id. at 79-88.
5Id. at 100-103.
6Id. at 100-101.
7Id. at 103.
8Id. at 113.
9Id. at 32. (Emphasis in the original)
11 Section 8. How to contest such documents. – When an action or defense is founded upon a written instrument, copied in or attached to the corresponding pleading as provided in the preceding section, the genuineness and due execution of the instrument shall be deemed admitted unless the adverse party, under oath, specifically denies them, and sets forth what he claims to be the facts, but the requirement of an oath does not apply when the adverse party does not appear to be a party to the instrument or when compliance with an order for an inspection of the original instrument is refused.
12 Section 10. Specific denial. – A defendant must specify each material allegation of fact the truth of which he does not admit and, whenever practicable, shall set forth the substance of the matters upon which he relies to support his denial. Where a defendant desires to deny only a part of an averment, he shall specify so much of it as is true and material and shall deny only the remainder. Where a defendant is without knowledge or information sufficient to form a belief as to the truth of a material averment made to the complaint, he shall so state, and this shall have the effect of a denial.
13Government Service Insurance System v. Prudential Guarantee and Assurance, Inc., G.R. Nos. 165585 and 176982, November 20, 2013.
14 504 Phil. 472 (2005).
15 Id. at 480. (Citations omitted)
16 G.R. No. 155680, July 2, 2012, 675 SCRA 407.
17 Id. at 418.
18Rollo, pp. 40-41. (Emphasis supplied)
19 Id. at 31-32. (Italics in the original)