RADIOWEALTH FINANCE COMPANY v. . SPS. VICENTE

FACTS:

Spouses Vicente and Maria Sumilang del Rosario executed a Promissory Note in favor of Radiowealth Finance Company for the amount of P138,948. The Promissory Note contained provisions on the payment schedule, late payment charges, and attorney's fees in case of default. The del Rosarios defaulted on their payments despite repeated demands. Radiowealth Finance Company filed a complaint for the collection of the unpaid sum of money. During the trial, Radiowealth Finance Company presented documentary evidence, which was admitted by the trial court. However, the trial court dismissed the complaint for lack of substantiation. On appeal, the Court of Appeals reversed the trial court's decision and remanded the case for further proceedings. Radiowealth Finance Company filed a Petition for Review on Certiorari, arguing that the Court of Appeals should have rendered judgment on the basis of the evidence presented.

ISSUES:

  1. Whether the Court of Appeals erred in ordering the remand of the case to the trial court for further proceedings instead of rendering judgment on the basis of the petitioner's evidence.

  2. Whether the obligation under the promissory note was due and demandable.

RULING:

  1. Remand of the Case

    • The Supreme Court held that when a demurrer to evidence is granted by a trial court and reversed on appeal, the reviewing court should render judgment on the basis of the evidence submitted by the plaintiff and should not remand the case for further proceedings. Hence, the appellate court erred in remanding the case to the trial court.
  2. Due and Demandable Obligation

    • The Supreme Court ruled that the obligation under the promissory note became due and demandable as the respondents defaulted on their monthly installments. The petitioner's evidence was sufficient to establish their cause of action, and the acceleration clause in the promissory note made the entire debt due upon default.

PRINCIPLES:

  1. Effect of a Reversed Demurrer to Evidence

    • Upon reversal of a trial court's order dismissing a case on a demurrer to evidence, the defendant is deemed to have waived the right to present evidence. The appellate court is obliged to render judgment on the merits based on the plaintiff's evidence (Rule 33, Section 1 of the 1997 Rules of Court).
  2. Acceleration Clause

    • An acceleration clause in a promissory note makes the entire obligation due and payable upon the debtor's default on any installment payment.
  3. Interpretation of Contractual Ambiguities

    • When specific dates are left blank in a promissory note for installment payments, the expressed intent of monthly installments and the existence of an acceleration clause indicate that the payments are due monthly.
  4. Documentary Evidence Admission

    • Admissibility of documentary evidence does not necessarily depend on the personal knowledge of the witness presenting it if it is produced to establish its fact of existence or tenor.
  5. Rules on Evidence Construction

    • The rules on evidence should be liberally construed to promote the objective of obtaining a just, speedy, and inexpensive determination of an action.
  6. Contractual Penalties and Fees

  • Defaulting parties may be liable for stipulated penalties and reasonable attorney's fees as included in the contractual terms, but unconscionable impositions, such as overlapping penalties and liquidated damages, may not be enforced.