Carantes vs. Court of Appeals,
G.R. No. L-33360, April 25, 1977
Subject: Obligations and
Contracts
FACTS
Mateo Carantes (Mateo) was the
original owner of a lot situated in Baguio City. He was survived by his widow,
Ogasia and six children.
In 1930, the government commenced
expropriation proceedings to acquire a portion of the land of Carantes for the
construction of a landing field of the Loakan Airport. One of his sons,
Maximino Carantes (Maximino) became the administrator of the estate. Maximino
then filed for a project of partition wherein he listed his four brothers and
sisters as the heirs of Mateo Carantes, who are also entitled to inherit their
father’s estate.
However, because negotiations
were underway, during that time, for the purposes of widening the Loakan
Airpoty, the only property that was listed by Maximino in the project partition
was the remaining portion of Lot No. 44. Four of Mateo’s heirs, namely, Bilad,
Lauro, Sianang, and Crisipino, executed a deed denominated “Assignment of Right
to Inheritance” assigning to Maximo their rights over Lot No.44. The stated
monetary consideration is P1.00. However, the deed contained a recital stating
that the said lot is exclusively and rightly belongs to Maximo and that he has
been in possession of the same for more than 10 years. Maximo then sold the
Lots and divided the proceeds of the sale among himself and the other heirs of
Mateo.
After the transferring of titles
to the names of the Government and Mateo over the subject lot and the remaining
lot (44-E) respectively, the three children of the late Mateo Carantes, namely
Bilad, Lauro and Crispino, as well as some of the surviving heirs of Apung and
of Sianang (also children of Mateo), filed a case before the trial court
praying that the deed of “Assignment of Right to Inheritance” be declared null
and void; that Lots Nos. 44-D and 44-E be ordered partitioned into six (6)
equal shares and Maximo be ordered to execute the necessary deeds of conveyance
in favor of the other distributees.
The contention of the heirs was
that the aforementioned deed of assignment was executed through fraud because
the Maximo made them believed that the said document embodied an understanding
that Maximo was merely authorized to convey portions of Lot No. 44 to the
Government in their behalf to minimize expenses and facilitate the transaction;
and that it was only until later on that the plaintiffs found out the same was
purported to assign Maximo all their rights to the inheritance of Mateo.
The RTC ruled in favor of Maximo
holing that the four-year prescription had already lapsed. The CA reversed the
decision of the RTC. Henceforth, the petition before the SC.
ISSUE
Whether or not reformation of
instrument is the proper remedy in the case at bar.
RULING
Yes, the reformation of
instrument is not the proper remedy in the case at bar.
Under the law (Art 1352, NCC),
the cause is unlawful if it is contrary to law, morals, good customs, public
order or public policy.
In this case, SC held that the
petitioner, Engracia Carantes, cannot seek for the reformation of the contract
because the same did not raise this during trial. Any change of theory after
the case has reached the Supreme Court must be disregarded and the said Court
shall proceed on the basis of the issues properly raised before the trial
court. Accordingly, the SC also cited paragraph 2 of Article 1359 of the Civil
Code whereby it stated that “If mistake, fraud, inequitable conduct, or
accident has prevented a meeting of the minds of the parties, the proper remedy
is not reformation of the instrument but annulment of the contract.” The
registration of an instrument constitutes a constructive notice to the whole
world, and discovery of fraud is deemed to have taken place at the time of
registration. It must deem to have been discovered on March 16, 1940, when the
Deed was registered in the Register of Deeds.
Thus, since the heirs filed the present action only in 1958, the action
has prescribed. CA judgment was set aside.
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