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Offer of Compromise in Civil Cases

Sec. 27. Offer of compromise not admissible. — In civil cases, an offer of compromise is not an admission of any liability, and is not admissible in evidence against the offeror.
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An offer to pay or the payment of medical, hospital or other expenses occasioned by an injury is not admissible in evidence as proof of civil or criminal liability for the injury. (Rule 130, Rules of Court)

● An offer to pay for expenses other than those occasioned by an injury is inadmissible in civil cases. The bottomline is: an offer to pay for any expense in civil cases is inadmissible.

● The general rule is an offer of compromise in a civil case is not an admission of liability. It is not admissible in evidence against the offeror.

The rule, however, is not iron-clad. To determine the admissibility or non-admissibility of an offer to compromise, the circumstances of the case and the intent of the party making the offer should be considered. Thus, if a party denies the existence of a debt but offers to pay the same for the purpose of buying peace and avoiding litigation, the offer of settlement is inadmissible. If in the course thereof, the party making the offer admits the existence of an indebtedness combined with a proposal to settle the claim amicably, then, the admission is admissible to prove such indebtedness. Indeed, an offer of settlement is an effective admission of a borrowers loan balance.

Similarly, in the case of Varadero de Manila v. Insular Lumber Co. the Court applied the exception to the general rule. In Varadero there was neither an expressed nor implied denial of liability, but during the course of the abortive negotiations therein, the defendant expressed a willingness to pay the plaintiff. Finding that there was no denial of liability, and considering that the only question discussed was the amount to be paid, the Court did not apply the rule of exclusion of compromise negotiations. (Tan vs. Rodil Enterprises, G. R. No. 168071, December 18, 2006)

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