Philippine National Bank Vs Uy Teng Piao

Facts:
On September 9, 1924, the CFI of Manila rendered a judgment in favor of PNB and against Uy
Teng Piao in a civil case for the sum of P17, 232.42 with interest at 7% from June 1, 1924, plus
10% of the sum amount for attorney's fees and costs. The court ordered Uy Teng Piao to
deposit the amount with the clerk of the court within 3 months from the date of the judgment.
In case of his failure to do so, the 2 mortgaged properties described in TCT Nos. 7264 and 8274
should be sold at public auction in accordance with the law and the proceeds applied to the
payment of the judgment.

Uy Teng Piao failed to comply with the order of the court, and the sheriff of the City of Manila
sold the two parcels of land at public auction to PNB for P300 and P1, 000 respectively. On
February 11, 1925, PNB secured from Uy Teng Piao a waiver of his right to redeem the property
described in TCT No. 8274. On the same date, the bank sold said property to Mariano Santos for
P8, 600. The other parcel of land was subsequently resold by the bank for P2,700, because the
account of Uy Teng Piao was credited with the sum of P11, 300. The bank credited Uy Teng Piao
with the full amount.

The bank brought the present action to revive the judgment for the balance of P11, 574.33,
with interest at 7% per annum from August 1, 1930. Uy Teng Piao alleged that he waived his
right to redeem the land described in the TCT of the first parcel of land, in consideration of an
understanding between him and the bank that it would not collect from him the balance of the
judgment. It was on this ground that the trial court absolved Uy Teng Piao from the complaint.

Issue:
1. Whether or not, there is an agreement between Uy Teng Piao and the bank not to collect
from him the remainder of the judgment?

2. Whether or not, the appearance of one of the lawyers of PNB as a witness is recognized?

Ruling:
1. None. Uy Teng Piao has failed to prove that there was an agreement.

2. No. He must not testify as a witness for his client, unless it is necessary as provided by the
Code of Professional Responsibility

Uy Teng Piao has failed to prove any valid agreement on the part of the bank not to collect from
him the remainder of the judgment. The alleged agreement rests upon the uncorroborated
testimony of the defendant. When asked on cross-examination if Pecson was not in Iloilo at the
time of the execution of Uy Teng Piao's waiver of his right to redeem, he answered that he did
not know; asked when Pecson had spoken to him about the matter, he replied that he did not
remember.

One of the attorneys for PNB testified that Uy Teng Piao renounced his right to redeem the
parcel of land in Calle Ronquillo, because his friend (Mariano Santos) was interested in buying
it. The bank ought to have presented Pecson as a witness, or his deposition if he was not
residing in Manila at the time of the trial.

With respect to the testimony of the bank's attorney, although the law does not forbid an
attorney to be a witness and at the same time an attorney in a cause, the courts prefer that
counsel should not testify as a witness unless it is necessary, and that they should withdraw
from the active management of the case.

Canon 19 of the Code of Legal Ethics:When a lawyer is a witness for his client, except as to
merely formal matters, such as the attestation or custody of an instrument and the like, he
should leave the trial of the case to other counsel. Except when essential to the ends of justice,
a lawyer should avoid testifying in court in behalf of his client.

Uy Teng Piao's testimony as to the alleged agreement is very uncertain. There is no mention as
to such an agreement on the part of the bank. It only provides the land in Calle Ronquillo. If
Pecson had made any such agreement as Uy Teng Piao claims, he would have required Uy Teng
Piao, a Chinese business man, to waive his right to redeem both parcels of land, and that he
would have insisted upon some evidence of the agreement in writing. Uy Teng Piao waived his
right to redeem the land in Calle Ronquillo, because a friend of his wished to purchase it and
was willing to pay P8, 600, and the bank agreed to credit Uy Teng Piao with the full amount of
the sale.

If it be conceded that there was such an understanding between Pecson and Uy Teng Piao, it is
not shown that Pecson was authorized to make any such agreement for the bank. Only the
board of directors or the persons empowered by the board of directors could bind the bank by
such an agreement. There is no merit in the contention that since the bank accepted the
benefit of the waiver it cannot now repudiate the alleged agreement. The fact that the bank
after having bought the land for P1, 000 resold it for P8,600 and credited the Uy Teng Piao with
the full amount of the resale was a sufficient consideration for the execution of defendant's
waiver of his right to redeem.