Admissibility of Offer of Compromise as Evidence Under Section 27 Rule 130 of Philippine Rules of Court

I. Introduction

The Philippine Rules of Court embody a deliberate policy choice that treats civil and criminal litigation differently when it comes to settlement negotiations. Section 27, Rule 130 crystallizes this distinction: in civil cases, offers of compromise are privileged and inadmissible against the offeror; in criminal cases (with narrow exceptions), they are admissible as implied admissions of guilt. The provision is one of the most frequently invoked exclusionary rules in Philippine evidence law and has remained substantially unchanged since the 1964 Rules, surviving the 1989 revisions and the 2019 Amendments to the Rules on Evidence.

II. Full Text of the Provision

Section 27, Rule 130, Rules of Court

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.

In criminal cases, except those involving quasi-offenses (criminal negligence) or those allowed by law to be compromised, an offer of compromise by the accused may be received in evidence as an implied admission of guilt.

A plea of guilty later withdrawn, or an unaccepted offer of a plea of guilty to a lesser offense, is not admissible in evidence against the accused who made the plea or offer.

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.

III. Rationale of the Rule

The bifurcated treatment rests on fundamentally different policy considerations:

A. Civil Cases
The rule encourages candid settlement negotiations. Parties are free to make generous offers without fear that such concessions will later be twisted into admissions of liability. Without this protection, litigants would be chilled from engaging in meaningful compromise discussions, prolonging litigation and clogging court dockets.

B. Criminal Cases
Public interest in the punishment of crime overrides the policy favoring settlement. An accused who offers money or other consideration to the victim to drop the case manifests consciousness of guilt. The Supreme Court has repeatedly held that such conduct is “in the nature of an attempt to escape the consequences of a wrongful act” (People v. De Guzman, G.R. No. 118670, February 21, 2000).

IV. Application in Civil Cases

1. Absolute Inadmissibility Against the Offeror
   Any offer, whether oral or written, formal or informal, to settle a civil dispute is inadmissible to prove liability or weakness of the offeror’s position. This includes:

   • Written demand letters containing settlement proposals
   • Statements made during compromise conferences
   • Offers made through mediators under the Court-Annexed Mediation (CAM) or Judicial Dispute Resolution (JDR)
   • “Without prejudice” communications (although the phrase is not strictly necessary under Philippine law)

2. Admissibility for Other Purposes
   The offer may be received to prove something other than liability, such as:

   • Bias or prejudice of a witness
   • Negativing a contention of undue delay
   • Capacity of the offeror to pay (in proper cases)
   • As proof that the claim was not baseless (when defendant pleads good faith)

   (See Trans-Pacific Industrial Supplies v. CA, G.R. No. 109172, August 19, 1994)

3. Distinction Between Offer of Compromise and Pure Admission of Fact
   If a party, in the course of negotiations, makes a clear admission of an independent fact (e.g., “I admit I was driving the vehicle that day”), that admission is separable and admissible, provided it is not inextricably linked to the compromise offer itself. The test is whether the statement would have been made even without the settlement context (PCI Bank v. Sps. Florencio Yu, G.R. No. 169464, February 27, 2008).

V. Application in Criminal Cases

1. General Rule: Admissible as Implied Admission of Guilt
   The prosecution may prove that the accused offered money, property, employment, or other valuable consideration to the complainant or family in exchange for desistance. Such proof is circumstantial evidence of guilt and may be appreciated even without other corroboration if sufficiently convincing.

2. Exceptions Where Inadmissibility Applies Even in Criminal Cases

   a. Quasi-offenses (criminal negligence under Articles 365, Revised Penal Code)
   Rationale: These are essentially private in character; the injury is more to the individual than to the State.

   b. Criminal cases allowed by law to be compromised (Art. 203, Revised Penal Code in relation to Rule 110, Sec. 23, 2023 Rules of Criminal Procedure)

   • Slight physical injuries
   • Theft, estafa, malicious mischief when value does not exceed P12,000 (as amended)
   • Intriguing against honor, reckless imprudence resulting in slight physical injuries, etc.

   In these cases, the civil law rule applies: the offer is inadmissible against the accused-offeror.

3. Compromise Offers Made by Third Parties
   Offers made by relatives, friends, or counsel on behalf of the accused are admissible only if there is proof that the accused authorized, ratified, or acquiesced in the offer (People v. Buntag, G.R. No. 136286, April 28, 2004).

VI. Plea of Guilty Later Withdrawn or Unaccepted Plea Bargain Offer

The third paragraph of Section 27 was introduced to align with modern plea-bargaining practices (2017 and 2019 amendments). Key points:

• A plea of guilty that is subsequently withdrawn under Rule 116, Sec. 8 is absolutely inadmissible for any purpose.
• An unaccepted offer to plead guilty to a lesser offense (whether formal plea-bargaining proposal or informal) cannot be used against the accused.
• Rationale: To encourage accused persons to explore plea bargaining without fear that failed negotiations will prejudice them at trial (Estipona v. Lobrigo, G.R. No. 226679, August 15, 2017).

VII. Offer to Pay Medical, Hospital or Other Expenses

The last paragraph embodies a humanitarian exception:

• Payment or offer to pay medical bills, even if accompanied by statements of sympathy (“I’m sorry this happened, let me shoulder the hospital bills”), is not admissible to prove civil or criminal liability.
• However, explicit admissions made at the same time (“I was drunk, I’m sorry, here’s money for the hospital”) may be separable and admissible if they go beyond mere humanitarian concern (People v. Saliling, G.R. No. 129088, June 25, 2001).

VIII. Leading Supreme Court Decisions

1. People v. Godoy, G.R. Nos. 115908-09, December 6, 1995
   Comprehensive discussion of the criminal-case rule; compromise offer by accused in rape case held admissible as strong evidence of guilt.

2. Trans-Pacific Industrial Supplies v. CA (1994)
   Classic civil-case ruling: settlement offer containing the phrase “without admitting liability” is still inadmissible.

3. PCI Bank v. Sps. Yu (2008)
   Refined the separability test for pure admissions during compromise talks.

4. People v. Buntag (2004)
   Compromise offers by third persons require proof of authority or ratification.

5. De la Rosa v. Heirs of Valdez (2019 amendment context)
   Reaffirmed that mediation statements under A.M. No. 19-10-20-SC (2019 Rules on Evidence) enjoy the same privilege.

6. Estipona v. Lobrigo (2017)
   Constitutionalized plea bargaining and indirectly reinforced the inadmissibility of rejected plea offers.

IX. Practical Litigation Notes

• Counsel should always object immediately when an offer of compromise is elicited, invoking Section 27 by name.
• In criminal cases, prosecutors routinely include desistance affidavits or proof of settlement offers in their formal offer of evidence.
• Judges conducting JDR must be meticulous in sealing mediation records; any leak may constitute reversible error.
• The privilege belongs to the offeror; the offeree may testify about the offer in criminal cases (when admissible) without violating the rule.

X. Conclusion

Section 27, Rule 130 represents a mature balancing of competing policies: the civil law’s preference for peace and compromise versus the criminal law’s demand for accountability. Its continued vitality—despite decades of procedural reforms—attests to the soundness of its underlying philosophy. Practitioners who master its nuances can protect settlement efforts in civil litigation while wielding a potent evidentiary weapon in appropriate criminal prosecutions.