JESUS CUENCO, - versus -TALISAY TOURIST SPORTS COMPLEX,
INCORPORATED AND MATIAS B. AZNAR III,
G.R. No. 174154
October 17, 2008
Digest by RJARuiz
FACTS:
On May 1992, petitioner leased from respondents for a period of two (2)
years the Talisay Tourist Sports Complex, to be operated as a
cockpit. The lease was later extended until May 8, 1998.
 
Under the Contract [1] it was stipulated that petitioner shall maintain in
good condition the furniture and equipment and shall keep the leased
premises clean and sanitary. Furthermore, petitioner would give a
deposit equivalent to six (6) months rental to answer for whatever
damages may be caused to the premises during the period of the lease. [4]
 
Upon expiration of the contract, respondent company conducted a public
bidding for the lease of the property. Petitioner participated in the
bidding. The lease was awarded to another bidder. Thereafter, petitioner
wrote four (4) demand letters for the return of his deposit amounting
P500,000.00.
As all of his demand letters remained unheeded, petitioner filed a
Complaint for sum of money, damages and attorneys fees.
Respondents countered that petitioner caused physical damage to some
portions of the leased premises and the cost of which amounted to more
than P500,000.00.
After pretrial, the RTC issued a Pre-trial Order which reads:
The following facts were admitted by the [respondents]:
 1. There is no inventory of damages up to this time;
 2. [Petitioner] deposited the amount of P500,000.00;
 3. [Petitioner] sends (sic) several letters of demand to [respondents]
but said letters were not answered.
On August 1999, the RTC rendered a Decision[20] in favor of petitioner.
On appeal, the CA rendered a Decision[23] reversing and setting aside the
decision of the RTC. Hence, this petition for review on certiorari.
Petitioner questions the CAs finding that there was damage caused to
the premises while the lease was still in force. Such finding was based on
alleged inventory of the property conducted by the
respondents. Petitioner takes exception to this evidence because of the
earlier judicial admission made by respondents counsel during pretrial
that no inventory was conducted and, accordingly, any evidence adduced
by the respondents inconsistent with the judicial admission should be
rejected.
ISSUE:
WON petitioner entitled to the return of the deposit. YES
HELD / RATIO:
WHEREFORE, the petition is PARTLY GRANTED. The Decision of the Court
of Appeals is hereby REVERSED AND SET ASIDE.
Respondents failed to present sufficient proof to warrant the retention
of the full amount of the deposit given by petitioner.
The Supreme Court is not a trier of facts, and as a rule, does not weigh
anew the evidence presented by the parties. However, the instant case is
one of the exceptions to the rule because of the conflicting decisions of
the RTC and the CA based on contradictory factual findings. Thus, we
have reviewed the records in order to arrive at a judicious resolution of
the case at bench.
Indeed, at the pre-trial conference, respondents counsel made an
admission that no inventory was made on the leased premises, at least
up to that time. This admission was confirmed in the Pre-Trial Order
issued by the trial court on March 8, 1999 after the lease expired on May
8, 1998.
Section 4, Rule 129 of the Rules of Court provides:
 SEC. 4. Judicial admissions. An admission, verbal or written, made by a
party in the course of the proceedings in the same case, does not
require proof. The admission may be contradicted only by a showing
that it was made through palpable mistake or that no such admission
was made.
 
A party may make judicial admissions in (1) the pleadings, (2) during the
trial, by verbal or written manifestations or stipulations, or (3) in other
stages of the judicial proceeding. [30] The stipulation of facts at the pre-
trial of a case constitutes judicial admissions. The veracity of judicial
admissions require no further proof and may be controverted only upon
a clear showing that the admissions were made through palpable
mistake or that no admissions were made. Thus, the admissions of
parties during the pre-trial, as embodied in the pre-trial order, are
binding and conclusive upon them.
 
Respondents did not deny the admission made by their counsel, neither
did they claim that the same was made through palpable mistake. As
such, the stipulation of facts is incontrovertible and may be relied upon
by the courts. The pre-trial forms part of the proceedings and matters
dealt therein may not be brushed aside in the process of decision-
making. Otherwise, the real essence of compulsory pre-trial would be
rendered inconsequential and worthless. [31] Furthermore, an act
performed by counsel within the scope of a general or implied authority
is regarded as an act of the client which renders respondents in estoppel.
By estoppel is meant that an admission or representation is conclusive
upon the person making it and cannot be denied or disproved as against
the person relying thereon.[32]