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SCC Chemicals Corp Vs CA

(1) SCC Chemicals Corporation obtained a loan from State Investment House Inc. (SIHI) and failed to repay it. SIHI filed a lawsuit. SCC admitted to taking the loan during pre-trial proceedings. (2) SIHI presented one witness during the trial to prove its claim. SCC repeatedly failed to cross-examine the witness when given opportunities by the court. The court ultimately ruled SCC had waived its right to cross-examine. (3) The appellate and supreme courts affirmed the ruling in favor of SIHI. SCC argued on appeal that SIHI's evidence violated hearsay rules due to lack of witness competence, but the supreme court

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200 views2 pages

SCC Chemicals Corp Vs CA

(1) SCC Chemicals Corporation obtained a loan from State Investment House Inc. (SIHI) and failed to repay it. SIHI filed a lawsuit. SCC admitted to taking the loan during pre-trial proceedings. (2) SIHI presented one witness during the trial to prove its claim. SCC repeatedly failed to cross-examine the witness when given opportunities by the court. The court ultimately ruled SCC had waived its right to cross-examine. (3) The appellate and supreme courts affirmed the ruling in favor of SIHI. SCC argued on appeal that SIHI's evidence violated hearsay rules due to lack of witness competence, but the supreme court

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MAC
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© © All Rights Reserved
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SCC Chemicals Corp vs CA

Facts: SCC Chemicals Corporation obtained a loan from State Investment House Inc. (SIHI). Upon
failure of SCC to pay, SIHI filed an action for a sum of money. During Pre-Trial, SCC admitted the
existence of the loan executed through its officers. SIHI presented one witness to prove its claim.
The cross-examination of said witness was postponed several times due to one reason or another at
the instance of either party.

The case was calendared several times for hearing but each time, SCC or its counsel failed to
appear despite notice.
SCC was finally declared by the trial court to have waived its right to cross-examine the witness of
SIHI and the case was deemed submitted for decision.

Trial court promulgated its decision in favor of SIHI. The appellate court affirmed in toto the judgment.
SCC elevated the case before the SC with the following contentions: (1) that SIHI introduced
documentary evidence through the testimony of a witness whose competence was not established
and whose personal knowledge of the truthfulness of the facts testified to was not demonstrated in
violation of Sections 36, Rule 130; and (2) that due execution and authenticity of private documents
evidencing the loan was not proved during trial.

Issue:
(1) Whether or not a defendant who failed to conduct cross-examination due to its own fault may
questioned the admissibility of the evidence for violation of hearsay rule.

(2) Whether or not the due execution of loan documents is necessary when the existence of the loan
had already been admitted during pre-trial.

Ruling:
(1)
Petitioner’s reliance on Section 36, Rule 130 of the Rules of Court is misplaced. As a rule, hearsay
evidence is excluded and carries no probative value.

However, the rule does admit of an exception. Where a party failed to object to hearsay evidence,
then the same is admissible. The rationale for this exception is to be found in the right of a litigant to
cross-examine. It is settled that it is the opportunity to cross- examine which negates the claim
that the matters testified to by a witness are hearsay. However, the right to cross-examine
may be waived.

The repeated failure of a party to cross-examine the witness is an implied waiver of such right.
Petitioner was afforded several opportunities by the trial court to cross-examine the other party’s
witness. Petitioner repeatedly failed to take advantage of these opportunities. No error was thus
committed by the respondent court when it sustained the trial court’s finding that the petitioner had
waived its right to cross- examine the opposing party’s witness. It is now too late for petitioners to be
raising this matter of hearsay evidence.

(2)
No. Respondent SIHI had no need to present the original of the documents as there was already a
judicial admission by petitioner at pre-trial of the execution of the promissory note and receipt of the
demand letter. It is now too late for petitioner to be questioning their authenticity. Its admission of the
existence of these documents was sufficient to establish its obligation. Petitioner failed to submit any
evidence to the contrary or proof of payment or other forms of extinguishment of said obligation.

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