!"#$%&%'()'*+,,"&Doctrine: The purpose of the prohibition against parole evidence is to prevent alteration, change, modification or contradiction of the

terms of a written instrument, admittedly existing, by the use of parole evidence, except in the cases specifically named in the section. Where an indorser claims that his name was forged, however, it is clear that parole evidence is admissible to prove that fact, and if he proves it, it is a comlete defense. Facts: Don Antonio Serrano loaned P3,000 to Padern, Moreno & Co. in behalf of Don Fernando Maulini. The loan was covered by a promissory note signed by F. Moreno in behalf of his own behalf and in behalf of his partner Jose Padern, payable to Serrano. Said promissory note was indorsed by Serrano in favor of Maulini, who is the real creditor. Padern & Co. failed to pay at the time of the due date so Maulini instituted an action against the the company and Serrano for the collection of a sum of money. Serrano presented parole evidence, claiming that he was merely negotiating as agent in behalf of Maulini to loan money to the company, and that he received no other consideration for the said note other than a small amount for his services. Hence, he could not be held liable as an indorser. As there was no consideration, Serrano could not be deemed an indorser. Maulini claimed that all parole evidence should not have been admitted, the terms of the agreement having been deemed reduced to writing. The promissory note, as it serves as evidence that there was a contract of indorsement, should be the only evidence admitted to determine the facts and circumstances of the case. Issue: Should parole evidence be admitted to show the true intent of the parties? Held: Yes. The prohibition in Section 285 of the Code of Civil Procedure does not apply to this case. The purpose of that prohibition is to prevent alteration, change, modification or contradiction of the terms of a written instrument, admittedly existing, by the use of parole evidence, except in the cases specifically named in the section. In this case, the evidence offered was not for the purpose of varying, altering, modifying or contradicting the terms of the contract of indorsement admittedly existing between the parties, but to deny that there ever existed any agreement whatever. In other words, the purpose of the parole evidence was to demonstrate that a relation of any kind whatever was created or existed between him and the indorsee by reason of the writing on the back of the instrument and that no consideration ever passed to sustain an indorsement of any kind whatsoever. Where an indorser claims that his name was forged, it is clear that parole evidence is admissible to prove that fact, and, if he proves it, it is a complete defense, the fact being that the indorser never made any such contract, that no such relation ever existed between him and the indorsee, and that there was no consideration whatever to sustain such a contract. In this case, while the indorser does not claim that his name was forged, he does claim that it was obtained from him in a manner which, between the parties themselves, renders the contract as completely inoperative as if it had been forged.

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