Title
Sarming vs. Dy
Case
G.R. No. 133643
Decision Date
Jun 6, 2002
A deed mistakenly identified Lot 5734 instead of Lot 4163; reformation was granted to reflect the true intent, with attorney's fees upheld but damages denied.
reformation of instrument
deed of sale
lower courts
A

Case Summary (G.R. No. 133643)

Factual Background

The litigation arose from a 1956 transaction in Dumaguete City involving two parcels: Lot No. 5734, covered by OCT No. 4918-A, and Lot No. 4163, covered by OCT No. 3129-A, both allegedly deriving from the estate of Valentina Unto Flores. Petitioners are successors-in-interest of the original defendant, Silveria Flores. Respondents are successors-in-interest of the original plaintiffs, including Alejandra Delfino, who purchased a one-half share of what the parties understood to be Lot No. 4163. The vendors were heirs of Jose Flores who purportedly sold their one-half share to Delfino; Silveria declined to buy for lack of money but, before execution of the written instrument, delivered the original certificate of title corresponding to Lot 5734 instead of Lot 4163. A notarized Settlement of Estate and Sale was executed on January 19, 1956, mistakenly designating Lot 5734. OCT No. 4918-A was cancelled and TCT No. 5078 issued to Silveria Flores and Alejandra Delfino as co-owners, after which Delfino took possession and effected improvements on the eastern half of Lot 4163.

Trial Court Proceedings

When Delfino later discovered the discrepancy, she and the vendors sought reformation of the deed and demanded turnover of the correct title. Silveria Flores failed to deliver OCT No. 3129-A, prompting the filing of a complaint for reformation of instrument with damages. Silveria answered asserting sole ownership of Lot 4163 as shown in OCT No. 3129-A and contending that the contract expressly described Lot 5734 and that the plaintiffs lacked authority to sell Lot 4163. After protracted proceedings, substitutions of parties, amendments, and reconstitution of records, the trial court found for the plaintiffs and ordered reformation and related conveyances; it also awarded P5,000 as actual damages, P10,000 as moral damages, and P2,000 as attorneys fees.

Court of Appeals Decision

The Court of Appeals affirmed the trial court in a brief disposition, finding that the true intention of the parties was to sell the one-half portion of Lot 4163 which Delfino had occupied and improved, and that the reference to Lot 5734 in the deed was a drafting mistake. The appellate court relied on the parties’ contemporaneous conduct, including Delfino’s immediate possession and the lack of objection by Silveria, and sustained the remedy of reformation.

Issues Presented on Appeal to the Supreme Court

The petition for review raised multiple assignments of error, which the Court distilled into three principal issues: (1) whether a cause of action for reformation of instrument lay against Silveria Flores and her successors-in-interest; (2) whether reformation was proper because the deed mistakenly designated the lot number; and (3) whether the plaintiffs were entitled to actual and moral damages and attorneys fees.

Petitioners’ Contentions

Petitioners argued that Silveria was never a party to the contractual sale of the one-half share and therefore no cause of action for reformation lay against her or her heirs; that the Settlement of Estate and Sale clearly and unambiguously described Lot 5734 as the subject and thus could not be reformed except upon clear and convincing evidence; that the Court of Appeals relied on biased testimony and disregarded that Silveria was the registered owner of Lot 4163 and paid real property taxes; and that the courts below improperly modified the parties’ agreement and awarded damages without proper legal foundation.

Respondents’ Contentions

Respondents maintained that the courts below had exhaustively and correctly examined the facts and that the petition raised no meritorious new matter. They asserted that the combined documentary record, possession and improvements by Delfino, the conduct of Silveria in delivering the wrong title, and the survey and testimony proved that the parties intended to convey the eastern half of Lot 4163 and that reformation was therefore proper.

Legal Standard for Reformation

The Court stated the controlling doctrine that reformation is an equitable remedy to make a written instrument express the real intention of the parties when the instrument fails to do so due to mistake, fraud, inequitable conduct, or accident. It quoted Article 1359, Civil Code and reiterated the conventional requisites: a meeting of minds, an instrument that does not express the true intention, and causation of such failure by mistake, fraud, inequitable conduct, or accident. The Court cited authorities including The National Irrigation Administration, etc. vs. Gamit, G.R. No. 85869, 215 SCRA 436 (1992), and Huibonhoa vs. CA, et al., G.R. Nos. 95897 & 102604, 320 SCRA 625 (1999).

Supreme Court Finding on Cause of Action

The Court rejected petitioners’ contention that no cause of action lay against Silveria and her successors. It observed that the complaint, taken at face value for purposes of determining the sufficiency of a cause of action, alleged that Silveria was a co-owner, that she was asked for the title to Lot 4163 but delivered OCT No. 4918-A for Lot 5734, and that Delfino took possession of the eastern half of Lot 4163. The Court emphasized the procedural rule that lack of cause of action must appear on the face of the complaint and that allegations in the complaint, if admitted, established a cognizable cause for reformation against the defendants named.

Supreme Court Finding on Reformation

Applying Article 1359, the Court held that the requisites for reformation were present. It found a meeting of the minds as to the intended object of the sale, namely one-half of Lot 4163, and that the instrument failed to express that intention because it mistakenly designated Lot 5734. The Court relied on the contemporaneous and subsequent acts of the parties — most notably Delfino’s uninterrupted possession and improvement of the eastern half since 1956 and Silveria’s delivery of an incorrect certificate of title — as evidentiary indicators of the true intention.

Evidence, Possession, and Credibility

The Court accepted the factual findings of the trial court regarding possession and subdivision of Lot 4163 and deferred to the trial court’s credibility determinations, which the Court of Appeals had affirmed. It credited testimony, notably that of Trinidad Flores, that Lot 4163 had been subdivided into two halves and that the heirs of Jose took possession of their portion upon succession. The Court observed that if Silveria had been the sole owner of Lot 4163 she would have objected to Delfino’s immediate possession. The Court also noted the spot investigation by a licensed surveyor showing subdivision of Lot 4163 into tw

...continue reading

Analyze Cases Smarter, Faster
Jur helps you analyze cases smarter to comprehend faster, building context before diving into full texts. AI-powered analysis, always verify critical details.

About Privacy Terms