SCC Chemicals Corp.

VS CA
353 SCRA 70 (2001)

Facts:

On December 13, 1983 petitioner SCC Chemical Corporation (SCC)

obtained a loan through its chairman private respondent Danilo Arrieta and
vice president, Pablo Bermundo from State Investment House Inc. (SIHI) in
the amount of Php 129,824.48. Private respondents executed a
Comprehensive Surety Agreement binding themselves jointly and severally
to pay the obligation on maturity date. SCC failed to pay the loan and
despite demands, no payment was made.

SIHI filed a case of sum of money against SCC with a prayer for
preliminary attachment against private respondents. SCC contends that SIHI
has no cause of action because the promissory note was null, void and no
binding effect. During the pre-trial stage, no settlement was reached
however, stipulation of facts was agreed upon, thus, the case proceeded to
trial. SIHI presented one witness to prove its claim. The cross- examination
of the said witness was postponed despite being calendared many times.
SCC or its counsel failed to appear several times, thus, the RTC declared
SCC to have waived its right to cross-examine the witness of SIHI and the
case was deemed submitted for decision.

SCC elevated the case to CA and contended that SIHI had failed to
show, by a preponderance of evidence, that the latter had a case against it;
and that the witness presented to prove its claim was incompetent because
he had no personal knowledge of the transaction. SCC also contended that
no proof was shown of the genuineness of the signatures in the documentary
exhibits presented as evidence and that these signatures were neither
marked nor offered in evidence by SIHI. The appellate court affirmed the
RTCs decision. Hence, this petition.

ISSUE:

1. Whether or not judicial admission requires proof.

2. Whether the testimony of the witness is a hearsay evidence and
thus inadmissible.
RULING:

1. No. A judicial admission requires no proof. Petitioners

admission as to the execution of the promissory notes by it
through private respondents Arrieta and Bermundo at pre-trial
sufficed to settle the question of the genuineness of the
signatures. The admission having been made in stipulation of
facts at pre-trial by the parties, it must be treated as a judicial
admission. Under Sec. 4, Rule 129 of the ROC.

2. As a rule, hearsay evidence is excluded and carries no probative

value. However, the rule does admit of an exception. Where a
party failed to object to hearsay evidence, then the same is
admissible. The rationale for this exception is to be found in the
right of a litigant to cross-examine. It is settled that it is the
opportunity to cross-examine which negates the claim that the
matters testified to by a witness are hearsay. However, the
right to cross-examine may be waived. The repeated failure of a
party to cross-examine the witness is an implied waiver of such
right.