NICEFORO S. AGATON, PETITIONER-APPELLANT, VS. HON. PATRICIO PEREZ, CARLOS S. MARTINEZ, AND FELIZA B. MARTINEZ, RESPONDENTS-APPELLEES.

Agaton versus Perez

The Case

This is a petition for certiorari, later elevated to the Supreme Court, arising from a complaint for the collection of unpaid rents, city services, and an indebtedness filed by the spouses Carlos S. Martinez and Feliza B. Martinez against their lessee, Niceforo S. Agaton. Agaton answered and set up affirmative defenses and counterclaims, but the private respondents met these only with a verbal denial. Agaton then moved for judgment on the pleadings, insisting that a general denial tenders no triable issue. The case matters because it teaches when a general denial is sufficient, and when judgment on the pleadings is proper, in the light of the old Rules of Court.

Procedural History

The private respondents filed their complaint for collection in the municipal court of Baguio. Agaton filed a written answer containing denials and two special affirmative defenses and counterclaims. When the case was called for hearing, the private respondents were furnished a copy of the answer and manifested that they were denying specifically each and every allegation of the counterclaims, the truth being that the claim was filed in good faith. The trial then proceeded on the private respondents' case. Agaton made a verbal motion for judgment on the pleadings with respect to his counterclaims, which the municipal court denied, as it denied his motion for reconsideration. Agaton then filed a petition for certiorari with the Court of First Instance of Baguio, alleging grave abuse of discretion. That court, in its decision of January 10, 1962, ruled that there was no such abuse and dismissed the petition, with costs. Agaton interposed the present appeal to the Supreme Court.

Facts

On June 15, 1960, Feliza B. Martinez and her husband Carlos S. Martinez entered into a contract of lease with Niceforo S. Agaton covering the second floor of their house at Camp 8, Kennon Road, Baguio City. The term of the lease was up to June 15, 1961, at a monthly rental of 100 pesos.

On May 8, 1961, the spouses filed a complaint in the municipal court of Baguio for the collection of rents unpaid since December 18, 1960, the value of certain city services which Agaton was supposed to pay but did not, thus compelling them to pay them, and another indebtedness in the sum of 200 pesos, together with attorney's fees of 150 pesos.

Agaton filed a written answer containing denials and two special affirmative defenses and counterclaims. The first narrated evidentiary facts tending to show that the spouses had misled him into renting by making him believe there was regular transportation to and from the city proper when there was none, and sought compensatory damages for taxi fares. The second narrated how Feliza Martinez went to see his employer, the Superintendent of the Baguio Military Institute, to inquire whether he was getting his salary on time, an act alleged to be malicious and intended to embarrass and humiliate him, and sought moral damages. At the hearing, the spouses gave a verbal denial of the counterclaims, and Agaton moved for judgment on the pleadings.

Issues

• Whether or not the private respondents' verbal answer to the counterclaims was a mere general denial that tendered no triable issue.
• Whether or not the municipal court was bound to render judgment on the pleadings upon Agaton's motion.
• Whether or not the municipal court committed grave abuse of discretion in denying the motion for judgment on the pleadings.

Applicable Provisions

Section 6 of Rule 4 of the old Rules of Court, on answers in inferior courts, provides:

Section 6. Answer. The answer shall be in writing, signed by the defendant or his attorney, and filed with the court, and a copy thereof served upon the adverse party or his attorney.

The Court noted that under the old Rules an answer in the municipal court to a counterclaim was not required to be in writing, which bears on whether the verbal denial could be treated as an answer at all.

Section 1 of Rule 11 of the old Rules of Court, on new matters alleged in the answer, provides:

Section 1. New matter. Any new matter constituting a defense or counterclaim must be set up in the answer.

The Court applied this rule to hold that new matters affirmed in the answer may be deemed controverted even if not specifically challenged in a reply.

Ruling

On the first issue, the Court held that there was no merit in the argument that the verbal answer was a mere general denial. Agaton's answer, particularly the portions he denominated special affirmative defenses and counterclaims, contained so many unnecessary allegations of evidentiary matters that a specific denial of each and every one of them was not only uncalled for but even impractical, especially since the old Rules did not require an answer in the municipal court to be in writing. Moreover, the allegations in the special affirmative defenses and in the counterclaims were so inseparable and had been lumped by Agaton himself under common headings that, following the rule as to new matters affirmed in the answer, they may be deemed controverted even if not specifically challenged in a reply. Finally, the basic allegations making up the counterclaims, namely, misrepresentation and malice, were specifically traversed by the private respondents' allegation of good faith in their verbal answer.

On the second and third issues, the Court held that the municipal court acted correctly and with proper judicial circumspection in denying the motion for judgment on the pleadings. Far from committing grave abuse of discretion, the court a quo committed none, and the decision appealed from was affirmed.

Doctrine

A general denial may suffice where the adverse party's pleading is so loaded with unnecessary evidentiary allegations that a specific denial of each and every one of them would be uncalled for and impractical. New matters set up in an answer as affirmative defenses or counterclaims are deemed controverted even if not specifically challenged in a reply, following the rule on new matter. Where the basic allegations of a counterclaim, such as misrepresentation and malice, are traversed by an allegation of good faith, a triable issue is joined, and judgment on the pleadings is improper. Judgment on the pleadings lies only where the answer tenders no issue at all.

Disposition

The Supreme Court affirmed the decision of the Court of First Instance of Baguio, with costs against petitioner-appellant Agaton.

Remember This

The single line worth memorizing is that a general denial tenders a triable issue where the opposing pleading is cluttered with unnecessary evidentiary matter, and new matters in an answer are deemed controverted without a reply. Examiners use this case to test judgment on the pleadings and the sufficiency of denials under the old Rules of Court.