Unformatted text preview: d to modify the judgment on compromise. It gave credence to the testimony of Atty. Leonardo Cruz that
petitioner consented to the penalty clause in the compromise agreement. The court further noted that it was
only on February 20, 1997, or more than one year from receipt of the judgment on compromise on October
25, 1995, when he questioned the inclusion of the penalty clause in the approved compromise agreement
despite several opportunities to raise said objection.
CA: Affirmed. Hence this petition.
ISSUE: Whether or not the penalty clause is void – NO
WON Atty. Cruz exceeded the authority given to him? NO
A scrutiny of the records reveal that the trial court correctly sustained the claim of private respondent. While
a judicial compromise may be annulled or modified on the ground of vitiated consent or forgery, we find that
the testimony of the petitioner failed to establish the attendance of fraud in the instant case. Indeed, the
testimony of Atty. Leonardo Cruz is worthy of belief and credence. We are inclined to believe that the
petitioner had knowledge of and consented to the penalty clause embodied in the agreement considering
that the same is less burdensome than the automatic imposition of the penalty of P250,000.00 and
attorney’s fees of P50,000.00 in case of violation of the terms of the agreement or default in payment.
Moreover, we see nothing irregular in the compromise agreement approved by the trial court. No evidence 58 was presented by petitioner other than his bare allegation that his former counsel fraudulently attached the
page of the genuine compromise agreement where he affixed his signature to the compromise agreement
submitted to the court.
Evidently, petitioner cannot feign ignorance of the existence of the penalty clause in the compromise
agreement approved by the court. Even assuming that Atty. Leonardo Cruz exceeded his authority in
inserting the penalty clause, the status of the said clause is not void but merely voidable, i.e., capable of
being ratified. Indeed, petitioner’s failure...
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- Fall '14
- gutierrez hermanos, B.A. Finance Corporation