FACTS:

The case involves a dispute between the petitioners, Jose and Preciosisima Binarao, and the respondent, Plus Builders, Inc., regarding the payment of a house and lot in Bahayang Pag-asa Subdivision in Cavite City. The petitioners purchased the property for a total price of P327,491.95 and executed an Affidavit of Undertaking on Equity agreeing to pay the respondent P96,791.95. However, the petitioners failed to fulfill their undertaking, prompting the respondent to send them a demand letter. The petitioners made a partial payment of P20,000.00, leaving a balance of P65,571.22 payable in three installments. The respondent then sent another demand letter, but the petitioners refused to pay. Consequently, the respondent filed a complaint for a sum of money against the petitioners. The Metropolitan Trial Court (MTC) rendered a decision in favor of the respondent, which was affirmed by the Regional Trial Court (RTC) and the Court of Appeals. The Court of Appeals held that the petitioners' admission of liability in their answer was binding, and their failure to show any palpable mistake warranted the dismissal of their petition. The Supreme Court denied the petition, affirming the decision of the Court of Appeals.

ISSUES:

1. Whether or not petitioners admitted their liability under the proposed payment plan dated July 6, 1998.

2. Whether or not petitioners' admission of liability in their answer binds them.

RULING:

1. The Supreme Court dismissed the petition and affirmed the decision of the Court of Appeals. It held that the admission made by the petitioners in their answer binds them, as it is considered a judicial admission. The Court explained that a judicial admission, whether verbal or written, made by a party in the course of the proceedings in the same case does not require proof and may only be contradicted by showing that it was made through palpable mistake or that no such admission was made. In this case, the petitioners admitted in their answer the allegations in the complaint, specifically admitting that they still had a balance of P65,571.22 to be paid in three installments. The Court further emphasized that judicial admissions cannot be contradicted by the party making the admission. Since the petitioners failed to show any palpable mistake in their admission, their liability under the proposed payment plan stands.

PRINCIPLES:

• Section 4, Rule 129 of the Revised Rules of Court - An admission, verbal or written, made by a party in the course of the proceedings in the same case does not require proof and may only be contradicted by showing that it was made through palpable mistake or that no such admission was made.

• Judicial admissions - A judicial admission made by a party, whether verbal or written, in the course of the proceedings in the same case binds the party who made the admission and cannot be contradicted by that party, unless it can be shown that the admission was made through palpable mistake.