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ASUNCION ATILANO, CRISTINA ATILANO, ROSARIO ATILANO, assisted by their

respective husbands, HILARIO ROMANO, FELIPE BERNARDO, and


MAXIMOLACANDALO, ISABEL ATILANO and GREGORIO ATILANO, plaintiffs-
appellees, vs.LADISLAO ATILANO and GREGORIO M. ATILANO, defendants-appellants.
G.R. No. L-22487 May 21, 1961

Doctrine:
When one sells or buys real property - a piece of land, for example - one sells or buys the property
as he sees it, in its actual setting and by its physical metes and bounds, and not by the mere lot
number assigned to it in the certificate of title.

Issue:
Was the intention of the parties the determining factor in the contract of sale?

Facts:
In 1916, Eulogio Atilano I owned lot No. 535 in the municipality of Zamboanga cadaster which he
divided into give (5) parts. Namely as lots Nos. 535-A, 535-B, 535-C, 535-D, and 535-E. Lot. No.
535-E was sold to Eulogio Atilano II, Eulogio Atilano I’s brother, while 535-B to 535-D were sold
to other persons. Upon the death of Eulogio Atilano I, the remaining portion of land which is
presumably lot no. 535-A, was passed down to defendant Ladislao Atilano.
When Eulogio Atilano II died, his wife Luisa Bautista and his children sought the land to be
subdivided. It was then discovered that the land they were occupying was lot No. 535-A and not lot
No. 535-E which was covered in the transfer certificate of title. And that the land occupied by
Ladislao Atilano was lot No. 535-E. Lot No. 535-E has an area of 2,612 square meters area while lot
No. 535-A covered 1,808 square-meter.
Heirs of Eulogio Atilano II filed in the Court of First Instance of Zamboanga demanding the return
of lot No. 535-E while surrendering their possession of lot No. 535-A. Defendants refused to accept
the exchange and contended that the reference to lot No. 535-E in the deed of sale of May 18, 1920
was an involuntary error and that the intention of the parties in the contract of sale was lot No. 535-
A. And that it was evident since Eulogio Atilano even purchased a portion from an adjoining lot
which increases the area of his property. It was also found that Eulogio Atilano II has constructed
his residence therein even before the sale was constituted
The trial court ruled in favor of the plaintiffs saying that the property was registered under the Land
Registration Act and that the defendants could not acquire it through prescription
Ruling:
Yes. When one sells or buys real property - a piece of land, for example - one sells or buys the
property as he sees it, in its actual setting and by its physical metes and bounds, and not by the mere
lot number assigned to it in the certificate of title. In the particular case before us, the portion
correctly referred to as lot No. 535-A was already in the possession of the vendee, Eulogio Atilano
II, who had constructed his residence therein, even before the sale in his favor; indeed, even before
the subdivision of the entire lot No. 535 at the instance of its owner, Eulogio Atilano I.
The real issue here is not adverse possession, but the real intention of the parties to that sale. From
all the facts and circumstances we are convinced that the object thereof, as intended and understood
by the parties, was that specific portion where the vendee was then already residing, where he
reconstructed his house at the end of the war, and where his heirs, the plaintiffs herein, continued to
reside thereafter: namely, lot No. 535-A; and that its designation as lot No. 535-E in the deed of sale
was a simple mistake in the drafting of the document. The mistake did not vitiate the consent of the
parties, or affect the validity and binding effect of the contract between them. The new Civil Code
provides a remedy for such a situation by means of reformation of the instrument. This remedy is
available when, there having been a meeting of the minds of the parties to a contract, their true
intention is not expressed in the instrument purporting to embody the agreement by reason of
mistake, fraud, inequitable conduct or accident (Art. 1359, et seq.). In this case, the deed of sale
executed in 1920 need no longer be reformed. The parties have retained possession of their
respective properties conformably to the real intention of the parties to that sale, and all they should
do is to execute mutual deed of conveyance.
When there is difference between the lot number stated in a certificate of title and the intention of
the contracting parties the latter must be followed. In the case at bar, it was found that lot No. 535-
A was the intended subject of the contract of sale rather than lot No. 535-E.
Therefore, the judgement appealed from is reversed. Plaintiffs are to execute a deed of conveyance
of lot No. 535-E in favor of defendants and that defendant are to execute a similar document of lot
No. 535-A in favor of plaintiffs.