Heirs of Botenes v. Municipality of Carmen
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns Lot No. 2, Block 25, covered by Transfer Certificate of Title (TCT) No. T-77779, registered in the name of Wilfredo C. Botenes. The Municipality of Carmen, Davao, initially engaged a geodetic engineer to survey and subdivide a tract of land for a town site. Based on a 1981 subdivision plan, the Municipality executed deeds of sale with mortgage over Lot No. 2 in favor of Botenes. Subsequently, a revised 1990 subdivision plan renumbered the lots, causing Lot 2 of the 1981 plan to become Lot 19 under the 1990 plan, and vice versa. The Municipality later executed a Deed of Absolute Sale over Lot No. 2 in favor of Botenes, leading to the issuance of TCT No. T-77779 in his name. Meanwhile, another party, Merlyn Plasabas, sold Lot 2, Block 25 (formerly Lot 19 under the 1981 plan) to the Rural Bank of Panabo (Davao), Inc. (now One Network Bank). 2. Procedural History: The Rural Bank of Panabo (Davao), Inc. encountered difficulties registering its ownership as the property was already registered under Botenes' name. The bank alleged a mistake in the 1992 Deed of Absolute Sale, claiming it should have referred to Lot 19 of the 1990 plan instead of Lot 2 of the 1981 plan. Botenes refused the correction, leading the Municipality and the bank to file a petition for reformation of instrument, quieting of title, and damages before the Regional Trial Court (RTC). The RTC dismissed the case. Botenes' heirs were substituted after his death. The Court of Appeals (CA) remanded the case for trial. Despite the order for a full-blown trial, the parties submitted memoranda. The RTC again dismissed the petition. The Municipality and the bank appealed to the CA, which reversed the RTC's decision, granting the petition for reformation and ordering the amendment of the deed and title. The CA denied the subsequent motion for reconsideration. 3. The Petition: The Heirs of Wilfredo C. Botenes filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing the Decision and Resolution of the Court of Appeals. The petitioners argue that the Deed of Absolute Sale and the certificate of title accurately reflected the true intent of the parties regarding the sale of Lot 2, Block 25 under the 1981 Plan. They contend that the CA erred in granting the reformation of the instrument and ordering the amendment of the title, asserting that the technical description in the original deed and title clearly identified the property sold to Botenes, and that the renumbering in the 1990 plan should not invalidate his established a different intent. The core of the petition is to uphold the validity of the original deed and title as reflecting the parties' true agreement and to prevent the reformation of the instrument.
Issue(s)
Whether the reformation of the 1992 Deed of Absolute Sale should be granted to reflect the intention of the parties, considering the subsequent approval of the 1990 Subdivision Plan and its impact on lot numbering. Whether the subsequent issuance of TCT No. T-77779 in favor of Botenes was proper, and if not, what is the appropriate remedy considering the discrepancies arising from the 1990 Subdivision Plan.
Ruling
The Supreme Court partly granted the petition, reversing the Court of Appeals' decision. The Court ordered the Rural Bank of Panabo (Davao), Inc. to file the appropriate petition for the amendment of TCT No. T-77779 within thirty (30) days from the finality of the Decision, to change the property description from Lot 2, Block 25 of the 1981 Subdivision Plan to Lot 19, Block 25 of the 1990 Subdivision Plan, pursuant to Section 108 of Presidential Decree No. 1529.
Ratio Decidendi
On the issue of reformation and the propriety of the title: The Court held that while the 1992 Deed of Absolute Sale and TCT No. T-77779 in Botenes' name correctly reflected the parties' intent at the time of their execution, specifically identifying Lot 2, Block 25 with its technical description under the 1981 Subdivision Plan, the subsequent approval of the 1990 Subdivision Plan altered the numbering of the lots. The Court noted that the geodetic engineer admitted that the changes in the 1990 Plan were merely in the numbering of the lots, and that in preparing final deeds of sale after the 1990 Plan's approval, the old numbers were inadvertently carried over, leading to discrepancies. The Court distinguished the case from that of Generoso Ebo and Perla Sandig, where parties reconveyed their lots due to discrepancies that became evident before the execution of their deeds, unlike Botenes' case where the technical description in his deed and title clearly identified the lot. However, recognizing the existence of the 1990 Plan which altered lot numbering, the Court found it necessary to amend Botenes' title to conform to the new numbering, as per Section 108 of PD No. 1529, which allows for amendment of titles due to errors or omissions. The Court directed the bank, as the successor-in-interest to the lot that was intended to be sold under the 1990 Plan, to file the petition for amendment, deeming it equitable to avoid additional costs for the rightful owner.
Main Doctrine
While a deed of sale and title may reflect the parties' true intent at the time of execution, subsequent changes in lot numbering due to an approved subdivision plan may necessitate amendment of the title to conform to the new numbering, provided the technical description clearly identifies the property and the amendment is sought through proper court proceedings.