Philippine National Railways v. Court of First Instance
REITERATIONFacts
The Antecedents: Private respondents Carmen Myrick, Salvacion Myrick, and the Millabas siblings filed a complaint to annul a supposed conditional donation of two parcels of land made in 1963 to petitioner Philippine National Railways (PNR). They alleged non-fulfillment of five conditions. No deed of donation was attached to the complaint. PNR denied the donation for lack of knowledge but asserted in its affirmative defenses that the donation was unconditionally made by the late Antonio J. A. Myrick and that the plaintiffs were guilty of laches. No deed of donation was attached to the answer. Procedural History: During the hearing, Salvacion Myrick was asked to identify a deed of donation dated August 23, 1962, made by her brother, Antonio J. A. Myrick, to the Manila Railroad Company (predecessor of PNR). The deed, marked as Exhibit B, showed a donation of 6,188 square meters for railway purposes, with no conditions mentioned. When Salvacion Myrick was asked why she did not sign the deed as a co-heir, PNR objected, citing the parol evidence rule, arguing that the deed was clear and unconditional and that the question sought to alter its terms. The trial court ordered the parties to submit memoranda on the admissibility of the question. Subsequently, the lower court overruled the objection, holding that the question would not transgress the parol evidence rule. The Petition: Petitioner PNR filed a certiorari and prohibition case, assailing the trial court's order as a grave abuse of discretion for overruling the objection based on the parol evidence rule.
Issue(s)
Whether the trial court committed grave abuse of discretion in allowing oral evidence to prove alleged conditions of a donation when such conditions were not mentioned in the written Deed of Donation and no exceptions to the Parol Evidence Rule were pleaded.
Ruling
The Supreme Court ruled that the trial court committed a grave abuse of discretion in overruling petitioner's objection. The Court reversed and set aside the order of the trial court dated July 7, 1977. Costs were against the private respondents.
Ratio Decidendi
On Issue 1: The Supreme Court held that the trial court committed grave abuse of discretion because it failed to apply the Parol Evidence Rule as mandated by Rule 130, Section 7 of the Rules of Court. The Court emphasized that for parol or extrinsic evidence to be admitted to vary the terms of a writing, the mistake, imperfection, or failure of the document to express the true intent of the parties must be specifically 'put in issue by the pleadings.' In this case, the private respondents merely alleged that the donation was conditional and sought its annulment; they did not allege that the written deed (which PNR produced) was vitiated by mistake or was an incomplete repository of the agreement. Applying the doctrine in Villanueva v. Yulo, the Court clarified that without such allegations in the complaint, parol evidence is strictly inadmissible to vary the terms of a written contract. The Court also noted that the private respondents' lack of cognizance of the terms of the deed—having failed to even attach a copy to their complaint—further undermined their attempt to engraft oral conditions onto the document. While evidentiary rulings are generally reviewable only on appeal, the Court cited De Laureano v. Adil to justify the use of certiorari, noting that a patent mistake in the application of the Parol Evidence Rule constitutes a grave abuse of discretion. Finally, the Court observed that the respondents failed to properly plead their capacity to sue as heirs of the donor, Antonio J.A. Myrick.
Main Doctrine
The parol evidence rule bars the admission of oral evidence to alter the terms of a written agreement unless the pleadings put in issue a mistake or imperfection in the writing, or its failure to express the true intent of the parties, or the illegality of the agreement. A party cannot introduce parol evidence to prove alleged conditions of a donation if such conditions are not pleaded in the complaint and the deed of donation itself does not contain them.