Sabio v. International Corporate Bank

364 SCRA 385

FACTS:

The spouses Gerardo and Emma Ledonio, one of the parties in LRC Case affecting the land, assigned to the spouses Camilo and Ma. Marlene Sabio (herein petitioners) all their rights, interests, title and participation over a contiguous portion of the subject property. Similarly, while the subject property was still the object of several pending cases, the International Corporate Bank, Inc. (or Interbank) acquired from the Trans-Resource Management and Development Corporation all of the latter’s rights to the subject property by virtue of a deed of assignment executed between them. Sometime thereafter, the Sabios and Interbank settled their opposing claims by entering into a MOA whereby the Sabios assigned, conveyed and transferred all their rights over the parcel to Interbank, with the express exception of a 58,000 square meter contiguous portion of said lot.

Subsequently, Interbank transferred all its rights and interests to the Las Piñas Ventures, Incorporated (or LPVI). The parcels of land were acquired by the Ayala Group. This entire property became the site of what was known then as “Ayala Las Piñas Subdivision.” Thereafter, a dispute arose concerning the 58,000 square meter contiguous portion subject of the MOA that was to be conveyed and transferred back to the Sabios by Interbank. Also in controversy was the permanent and perpetual right of way that Interbank was obligated to constitute in favor of the Sabios 58,000 square meter portion.

Plaintiffs claimed that defendant Interbank was obligated to complete and perfect its ownership and title to the parcels of land so that Interbank could transfer to plaintiffs the absolute ownership and title over the contiguous portion. They also claimed that one of the commitments of defendant Interbank which induced plaintiffs to execute the agreement without which plaintiffs would not have executed was that defendant Interbank would clear the contiguous portion of all occupants and wall-in the same, together with the parcels of land belonging to defendants. Allegedly, the property had already been cleared, by defendant Ayala Group, of occupants except for the contiguous portion thereof.

The defendants confessed judgment with regard to the plaintiff spouses prayer emanating from the MOA, and asked that judgment be rendered directing the defendants to comply with their obligations as defined in the pertinent provisions of the MOA. However, the defendants also averred that fulfillment of its obligation under the MOA became impossible due to the plaintiff spouses own acts.

First, defendants posited that they were ready to deliver the title to the 58,000 square meter parcel and had, in fact, prepared the Deed of Conveyance required by the Register of Deeds, but the plaintiffs themselves refused to sign the said deed unless the subject property was cleared of all squatters and other illegal occupants. The defendants nevertheless repudiated plaintiffs claim that they (defendants) were obligated to clear the said property of all squatters and occupants, much less to fence the said property, arguing that no such obligation was imposed in the MOA.

Secondly, the defendants noted that the property in question became the subject of an action for recovery of ownership filed by the Ledonio spouses against the Sabios. Consequently, the annotation of the notice of lis pendens caused to be registered by the Ledonios on the titles hampered the delivery of the title covering the 58,000 square meter portion to the Sabios.

ISSUES:

1. Whether or not the defendants had the obligation to clear the subject portion of all occupants and to fence the said premises, before conveyance of the property can be considered as full compliance with the obligation imposed upon the defendants under the MOA.
2. Whether or not symbolic delivery by mere execution of the deed of conveyance is not sufficient since actual possession, control and enjoyment is a main attribute to ownership.

RULING:

1. NO. Defendant Interbank has no obligation to clear the contiguous portion of the land of occupants and to wall-in the same for nothing in the MOA obligates Interbank to do so. “If the terms of a contract are clear and leave no doubt upon the intention of the contracting parties, the literal meaning of the stipulations shall control. If the words appear contrary to the evident intention of the parties, the latter shall prevail over the former.” (Art. 1370, Civil Code of the Philippines). The evidence does not show that the parties had intentions other than those commonly understood from the aforementioned terms in the MOA. The plaintiffs have failed to prove that the intention of the parties was other than that expressed by the literal meaning of the terms of the MOA.

The rule is that “when the terms of an agreement have been reduced to writing, it is considered as containing all the terms agreed upon and there can be between the parties and their successors-in-interest, no evidence of such terms other than the contents of the written agreement.”

There are exceptions to said rule, however, such as when:

1. There is an intrinsic ambiguity, mistake or imperfection in the writing;
2. The written agreement fails to express the true agreement and intent of the parties thereto;
3. The validity of the written agreement is in question; and
4. There exists other terms agreed by the parties or their successors-in-interest after the execution of the written agreement.

In the instant case, the MOA between the Sabios and Interbank was never assailed for any intrinsic ambiguity, mistake or imperfection in the writing by any of the parties. More importantly, petitioners never alleged in any of their pleadings that the MOA failed to express the true agreement and intent of the parties thereto. In sum, there is no justification in the instant case to admit parol evidence to support the petitioners claims. It is a cardinal rule of evidence, not just one of technicality but of substance, that the written document is the best evidence of its own contents.

2. No. We do not agree, for the law is clear on this matter. Under Article 1498 of the Civil Code, “when the sale is made through a public instrument, the execution thereof shall be equivalent to the delivery of the object of the contract, if from the deed the contrary does not appear or cannot be inferred.” Possession is also transferred, along with ownership thereof, to the petitioners by virtue of the deed of conveyance.

Notwithstanding the presence of illegal occupants on the subject property, transfer of ownership by symbolic delivery under Article 1498 can still be effected through the execution of the deed of conveyance. As we held in Power Commercial and Industrial Corp. v. Court of Appeals the key word is control, not possession, of the subject property. Considering that the deed of conveyance proposed by respondents did not stipulate or infer that petitioners could not exercise control over said property, delivery can be effected through the mere execution of said deed.

As stated above, prior physical delivery or possession is not legally required and the execution of the deed of sale or conveyance is deemed equivalent to delivery. This deed operates as a formal or symbolic delivery of the property sold and authorizes the buyer or transferee to use the document as proof of ownership. Nothing more is required.

*Case digest by Stephanie C. Castillo, JD-IV, Andres Bonifacio College, SY: 2019-2020

By |2020-03-11T01:43:49+00:00February 21st, 2020|Case Digests|0 Comments

Leave A Comment