What are the Effects of a Confession of Judgment under Philippine Law

Confession of Judgment

It has been defined as “a judgment where a defendant gives the plaintiff a cognovit or written confession of the action by virtue of which the plaintiff enters judgment.” (Black’s Law Dictionary 842 (6^th Ed. 1990)) It is also one by cognovit actionem, which Black’s Law Dictionary defines as “[a] defendant’s written acknowledgment of the plaintiff’s claim, authorizing the plaintiff to take a judgment for a named sum.” (Black’s Law Dictionary 296 (9^th Ed. 2009))

The Rules on Procedure in the Philippines does not expressly provide for the applicability of confession of judgment in its jurisdiction. For example, Act No. 2031, or the Negotiable Instruments Law of the Philippines, expressly authorizes confession of judgment. Meanwhile, in cases of legal separation and annulment of marriage in the Philippines, confession of judgment is not allowed since the grounds relied upon must be proved. Nevertheless, in a catena of cases, the Philippine Supreme Court has recognized the legal recourse and effect of confession of judgment.

In the consolidated cases of Sara Lee Philippines, Inc. vs. Emilinda Macatlang, et. al.[1], the Philippine Supreme Court had the occasion to define a “confession of judgment” based on American jurisprudence, thus:

“A confession of judgment is an acknowledgment that a debt is justly due and cuts off all defenses and right of appeal. It is used as a shortcut to a judgment in a case where the defendant concedes liability. It is seen as the written authority of the debtor and a direction for entry of judgment against the debtor.” [Emphasis and underscoring supplied.]

Cases involving a Confession of Judgment

In the case of Natividad vs. Natividad[1], the Philippine Supreme Court held that the compromise of causes and confession of judgments appear to stand upon the same footing and that since the compromise may not be effected by counsel without special authority, so may not an agreement to permit judgment to be entered against his client be authorized except with the knowledge and at the instance of the client.

In Acenas vs. Sison[2], the counsel for therein defendants moved that confession of judgment be entered in the case; verily, the trial court rendered judgment under the terms and conditions set forth in such motion. Subsequently, one of the defendants, Teofilo Sison, assailed the authority of their counsel to confess judgment on his behalf.

Citing the case of Natividad[3], the Philippine Supreme Court in the case of Acenas[4] held that it was error for the trial court to accept the confession made by counsel without ascertaining his authority to do so, at least with respect to defendant Teofilo Sison. As to the other defendant, Angela Sison, the Supreme Court upheld the confession of judgment in her behalf, there being no claim that the same was unauthorized.

In the case of Pfleider vs. C.N. Hodges[5],the Philippine Supreme Court was confronted with the issue of whether the prior judgment in another civil case docketed as No. 2860 between the same parties may be considered as a bar to the action filed anew by the plaintiff-appellant. Notably, the plaintiff-appellant, being the defendant in the Civil Case No. 2860, confessed judgment in accordance with the prayer of the complaint filed against him in the said Civil Case No. 2860.

Recognizing the plaintiff-appellant’s confession of judgment in the Civil Case No. 2860, and the decision of the trial court based on such confession, the Supreme Court in the case of Pfleider[6] held that the present cause of action of plaintiff-appellant is not barred by the judgment in Civil Case No. 2860 for it is a new cause of action that arose as a consideration for his confession of judgment in said previous case.

In the case of Mutual Paper, Inc. vs. Eastern Scott Paper Company[7], therein respondent originally filed an action for collection of a sum of money against petitioner. During the pendency of the action before the trial court, the petitioner paid the respondent a fraction of the amount and thereafter, confessed judgment on the unpaid balance for which the trial court rendered judgment.

Subsequently, the petitioner in Mutual Paper, Inc.[8] assailed the amount of the attorney’s fees awarded by the trial court in favor of the respondent. When the case reached the Philippine Supreme Court, the High Court held that the granted attorney’s fees is reasonable considering that it is approximately five percent (5%) of the unpaid balance, the amount of which the petitioner had confessed.

Lastly, in the case of Mid-Pasig Land Development Corporation vs. Sandiganbayan[9], the Philippine Supreme Court required the parties to file supplemental memoranda as to the additional issues raised during the oral arguments before it. In compliance thereto, the private respondent submitted a “Manifestation and Confession of Judgment”, withdrawing his objections to the Petition and his efforts to declare the petitioner in default.

With the filing of the above “Manifestation and Confession of Judgment”, the Philippine Supreme Court held in Mid-Pasig Land Development Corporation[10] that there is no longer any necessity for the Court to pass upon the merits of the case. It simply granted the motion and thus, granted the Petition.

Clearly, the concept of confession of judgment finds application in the Philippines and is widely recognized by the Philippine courts. A glimpse at American jurisprudence, which is a persuasive authority within the Philippine jurisdiction, may also prove helpful.

In the case of Kiener vs. Commerce Trust Co.[11], the Maryland Court pronounced that “A judgment by confession possesses all the incidents, is supported by the same presumptions, and is entitled to the same faith and credit, as any other judgment and that is so whether the confession is by the defendant in person or by another with his consent.”

In the case of Wieland vs. Danner Auto Supply, Inc.[12], the Oklahoma Court held that “A judgment by confession has the same legal effect as a judgment entered after trial by jury or to the court. x x x A judgment is the final determination of the rights of the parties in an action. Thus, a judgment by confession taken against a defendant under § 1101 is a final determination that a plaintiff has prevailed on his claim.” Similarly, in the case of Pederson vs. Potter[13], the Washington Court held that the confession of judgment would qualify as a judgment on the merits because the petitioners knew of their potential claims against the respondents when they settled and signed the confession of judgment. They had the opportunity to be heard on these claims, and have them disposed of, but chose not to do so.

Rules Governing Confession of Judgment

In fine, while there is dearth of Philippine rules or laws on confession of judgment, Philippine jurisprudence has clearly recognized and upheld the validity of judgment based on confession of judgment. In several jurisdictions in the United States, the courts have also attributed upon a confession of judgment the same faith and credit as those of any other judgment or final determination on the merits.

Concomitantly, it is not amiss to emphasize that under the Philippine law and rules, the Philippine courts are even authorized to render judgment on the facts, as pleaded, or on the facts, as summarily proved by the existing affidavits, depositions, or admissions of the parties. Sec. 1, Rule 34 of the Philippine Revised Rules of Court provides, to wit:

“RULE 34

JUDGMENT ON THE PLEADINGS

Section 1. Judgment on the pleadings. — Where an answer fails to tender an issue, or otherwise admits the material allegations of the adverse party’s pleading, the court may; on motion of that party, direct judgment on such pleading. However, in actions for declaration of nullity or annulment of marriage or for legal separation, the material facts alleged in the complaint shall always be proved.”

Meanwhile, Sec. 1 and 2, Rule 35 of the Philippine Revised Rules of Court provide, to wit:

“RULE 35

SUMMARY JUDGMENTS

Section 1. Summary judgment for claimant. — A party seeking to recover upon a claim, counterclaim, or cross-claim or to obtain a declaratory relief may, at any time after the pleading in answer thereto has been served, move with supporting affidavits, depositions or admissions for a summary judgment in his or her favor upon all or any part thereof.

Section 2. Summary judgment for defending party. — A party against whom a claim, counterclaim, or cross-claim is asserted or a declaratory relief is sought may, at any time, move with supporting affidavits, depositions or admissions for a summary judgment in his or her favor as to all or any part thereof.”

In the case of Adolfo vs. Adolfo[1], the Philippine Supreme Court elucidated on the basic distinction between a judgment on the pleadings and a summary judgment, thus:

“The existence or appearance of ostensible issues in the pleadings, on the one hand, and their sham or fictitious character, on the other, are what distinguish a proper case for summary judgment from one for a judgment on the pleadings. In a proper case for judgment on the pleadings, there is no ostensible issue at all because of the failure of the defending party’s answer to raise an issue. On the other hand, in the case of a summary judgment, issues apparently exist-i.e. facts are asserted in the complaint regarding which there is as yet no admission, disavowal or qualification; or specific denials or affirmative defenses are in truth set out in the answer-but the issues thus arising from the pleadings are sham, fictitious or not genuine, as shown by affidavits, depositions, or admissions.” [Emphasis supplied.] Evidently, the Philippine courts can render judgment in accordance with confession of judgment. In the same vein, they are duly empowered to render judgment on the pleadings or summary judgment, and dispense with a full-blown trial, where there is failure to tender an issue, admission of the material allegations of the adverse party’s pleadings, or complete omission to deal with the allegations in a case.[2]

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[1] G.R. No. 201427, 18 March 2015.

[2] Id.

[1] G.R. No. L-5073, 20 May 1953.

[2] G.R. No. L-17011, 30 August 1963.

[3] Id. at 20.

[4] Id. at 21.

[5] G.R. No. L-17683, 31 July 1962.

[6] Id.

[7] G.R. No. L-26540, 28 December 1981.

[8] Id.

[9] G.R. No. 110296, 30 October 1996.

[10] Id.

[11] 154 Md. 366 (Md. 1927).

[12] 1984 OK 45 (Okla. 1984).

[13] 103 Wn. App. 62 (Wash. Ct. App. 2000).

[1] G.R. No. 180147-50; G.R. No. 180319; and G.R. No. 180685, 14 January 2015.