Lechugas vs. Court of Appeals

The parol evidence rule does not apply, and may not be invoked by either party against the other, where at least one of the parties to the suit is not a party or privy of a party to the written instrument and does not base a claim on the instrument or assert a right originating in it. Strangers to a contract are not bound by it, and the rule excluding extrinsic evidence in the construction of writings is relaxed where either party between whom the question arises is a stranger to the written agreement.

Victoria Lechugas and the private respondents traced their claims to overlapping parcels of land in Lambunao, Iloilo. Hugo Loza, predecessor-in-interest of the respondents (except Salvador Anona and Jose Lozada), had acquired land from Victorina Limor in 1931 and from Emeterio Lasangue in 1941, while Leoncia Lasangue — Emeterio's daughter and only heir — later executed a deed of sale in favor of Lechugas. The controversy required the courts to determine which parcel the deed actually conveyed, against the backdrop of the parol evidence rule governing the admissibility of extrinsic evidence to vary a written instrument.

Victoria Lechugas filed a complaint for forcible entry with damages against the private respondents, alleging that they had, by means of force, intimidation, strategy, and stealth, unlawfully entered Lots A and B — corresponding to the middle and northern portions of her property known as Lot No. 5456 — appropriated the produce for themselves, and refused to surrender possession despite her demands. The complaint was dismissed, and Lechugas appealed to the Court of First Instance of Iloilo, where the case was docketed as Civil Case No. 5055. While that appeal was pending, she instituted a second action before the same court for recovery and possession of the same property, docketed as Civil Case No. 5303. The two cases were tried jointly.

According to Lechugas, she bought the litigated land from Leoncia Lasangue under a public Deed of Absolute Sale (Exhibit A), which she caused to be registered. Preparatory to the execution of the deed, she had the land segregated from the larger twelve-hectare portion owned by Lasangue by contracting the Sirilan Surveying Office to survey the land on December 3, 1950 and to establish its boundaries, shape, form, and area in accordance with a plan attached to Exhibit A. She declared the six-hectare portion in her name beginning 1951 under Tax Declaration No. 7912, paid the taxes, and possessed the land through tenants who shared the produce with her. Her tenant Simeon Guinta corroborated her account, testifying that he had worked the land since 1954 and that on June 14, 1958, while plowing Lot A preparatory to rice planting, the defendants entered the land and forced him to stop, with Salvador Anona, David Loza, and Jose Lozada carrying unsheathed bolos; that on June 24, 1958, the defendants entered Lot B and cut 620 bamboo poles despite the warning of Lechugas's overseer; and that in June 1959 the defendants seized the entire six-hectare parcel, leaving her no recourse but to file Civil Case No. 5303.

The defendants maintained that the land Lechugas bought from Lasangue in 1950 under Exhibit A was different from the land described in her complaint. Their evidence showed that on April 6, 1931, Hugo Loza — father of Carmelita Loza and predecessor-in-interest of the rest of the heirs (except Jose Lozada and Salvador Anona) — purchased a 53,327-square-meter parcel from Victorina Limor under a deed of "Venta Definitiva" (Exhibit 3), and that on March 17, 1941, he bought from Emeterio Lasangue a parcel of about four hectares (Exhibit 2), both of which he declared in his name and for which he paid taxes. These two parcels were consolidated and designated during the 1959 cadastral survey of Lambunao, Iloilo as Lot No. 5456, while the remaining portion of the Limor lot was designated Lot No. 5515 in the name of the Heirs of Hugo Loza. The defendants claimed that the lot Lechugas bought from Lasangue was situated south of the litigated land and was designated during the cadastral survey as Lot No. 5522, in the name of Victoria Lechugas.

Leoncia Lasangue, testifying for the defendants, declared that during his lifetime her father Emeterio Lasangue owned a parcel of land in Lambunao containing about thirty-six hectares; that he sold a four-hectare slice to Hugo Loza in 1941 and made other sales to other persons, leaving only about twelve hectares, which were transferred to her name as the only child and heir; and that on December 8, 1950, she sold six hectares of her inherited property to Lechugas under Exhibit A, which she thumbmarked. She testified that she sold only six hectares, that the litigated land was not included in the sale, and that the land she sold lay south of the land in litigation, on the edge of the whole property and on her right side (south) when facing east. She explained that because she did not know how to read or write and reposed confidence in Lechugas, her first cousin, she simply signed the document after Lechugas told her it was the instrument evidencing the sale of the land.

On the basis of these findings and the testimony of the vendor herself, who, although illiterate, was able to point out specifically the land she had sold, the appellate court upheld the trial court's decision, except that the deed of sale was declared not null and void ab initio insofar as Lasangue was concerned, because it could pass ownership of Lot No. 5522, which Lasangue intended to sell and actually sold to Lechugas.

• Parol Evidence: Petitioner argued that the respondent Court erred in considering parol evidence, over her objection, to vary the subject matter of the Deed of Definite Sale (Exhibit A), although the land therein was described and delimited by metes and bounds and identified as Lot No. 5456 of the Lambunao Cadastre, and that to impugn a written agreement the evidence must be conclusive.
• Change of Theory on Appeal: Petitioner maintained that the respondent Court erred in considering, for the first time on appeal, the theory of the defendants-appellees that the land described in Exhibit A is Lot No. 5522 instead of Lot No. 5456, their original theory being that the deed was null and void ab initio because Leoncia Lasangue could not sell the land in 1950 since it had allegedly been sold in 1941 by her father Emeterio Lasangue.
• Reformation Without Direct Action: Petitioner contended that the respondent Court could not reform the deed of definite sale by changing its subject matter in the absence of strong, clear, and convincing evidence and on the strength of the long testimony of the vendor, and that no direct action for reformation had been filed in the court of origin.

• Prior Sale and Lack of Capacity to Sell: Respondent maintained that the lot had been sold by Leoncia's father, Emeterio Lasangue, to their father, Hugo Loza, as far back as 1941, while the alleged sale by Leoncia to the petitioner took place only in 1950; thus they questioned and denied Leoncia Lasangue's capacity to sell the disputed lot to the petitioner.
• True Intention of the Vendor: Respondent asserted, in their affirmative defense, that Leoncia Lasangue had publicly and in writing repudiated the petitioner's pretension, to the effect that the parcel of land in litigation was not included in the sale she executed in favor of the petitioner.

• Parol Evidence: Whether the respondent Court erred in admitting and giving credence to parol evidence, over the petitioner's objection, to vary the subject matter of the Deed of Definite Sale (Exhibit A).
• Change of Theory on Appeal: Whether the respondent Court erred in considering the respondents' theory, raised for the first time on appeal, that the land described in Exhibit A is Lot No. 5522 instead of Lot No. 5456.
• Reformation of the Deed: Whether the respondent Court could reform the deed of definite sale by changing its subject matter in the absence of strong, clear, and convincing evidence and without a direct action for reformation.

• Parol Evidence: No. The parol evidence rule does not apply where the controversy is between one of the parties to the document and third persons who are strangers to it, and the vendor's testimony was properly admitted.
• Change of Theory on Appeal: No. The respondents, from the very start, had questioned and denied Leoncia Lasangue's capacity to sell the disputed lot and were already attacking the validity of Exhibit A, so no change of theory occurred.
• Reformation of the Deed: No. Strong, clear, and convincing evidence established that it was Lot No. 5522 that was actually sold, and the "reformation" upheld by the appellate court in fact favored the petitioner.

• Parol Evidence: The parol evidence rule does not apply, and may not properly be invoked by either party to the litigation against the other, where at least one of the parties to the suit is not a party or privy of a party to the written instrument in question and does not base a claim on the instrument or assert a right originating in it or the relation established thereby. Here, the deed of sale was executed by Leoncia Lasangue in favor of Victoria Lechugas, while the dispute over what was actually sold lay between Lechugas and the private respondents, who were strangers to the deed. The rule is therefore not applicable where the controversy is between one of the parties to the document and third persons. Through Lasangue's testimony, it was shown that what she really intended to sell, and to be the subject of Exhibit A, was Lot No. 5522, but because she could not read or write and fully relied on the good faith of her first cousin, the petitioner, she merely placed her thumbmark on a document that the petitioner told her evidenced the sale of the land. The deed instead described the disputed lot. The conclusion followed that Lasangue did not intend to sell, as she could not have sold, a piece of land already sold by her father to the predecessor-in-interest of the respondents.
• Change of Theory on Appeal: The contention that the respondents changed their theory on appeal lacked merit. From the very start, the respondents had questioned and denied Leoncia Lasangue's capacity to sell the disputed lot to the petitioner, contending that the lot had been sold by Leoncia's father, Emeterio Lasangue, to their father, Hugo Loza, in 1941, while the alleged sale by Leoncia to the petitioner took place only in 1950. In essence, the respondents were already attacking the validity of Exhibit A. Moreover, in their affirmative defense, the respondents had already raised doubt on the true intention of Leoncia Lasangue in signing Exhibit A when they alleged that she had publicly and in writing repudiated the petitioner's pretension that the parcel in litigation was included in the sale. Consequently, the petitioner could not impute grave abuse of discretion to the appellate court for allowing a change of theory, because in reality there was no such change.
• Reformation of the Deed: The contention that the lower court could not reform the deed of definite sale by changing the lot subject of the sale lacked merit. There was strong, clear, and convincing evidence that it was Lot No. 5522 that was actually sold to the petitioner, and no reason appeared to reverse the factual findings of both the Court of First Instance and the Court of Appeals on this point. The "reformation" that the petitioner questioned was, in fact, intended to favor her: instead of declaring the deed of sale null and void for all purposes, the Court upheld its having passed ownership of Lot No. 5522 to the petitioner. The fact that the vendor did not bring an action for the reformation of Exhibit A was of no moment, since the undisputed fact was that the respondents had timely questioned the validity of the instrument and had proven that Exhibit A did not reflect the true intention of the vendor.

• Parol Evidence Rule — Strangers to a Contract Not Bound — The parol evidence rule applies only as between the parties to a written agreement, or their privies, and bars the admission of extrinsic evidence to contradict or vary its terms. Strangers to a contract are not bound by it, and the rule excluding extrinsic evidence in the construction of writings is inapplicable in such cases; it is relaxed where either one of the parties between whom the question arises is a stranger to the written agreement and does not claim under or through one who is a party to it, in which case the rule binds neither. The Court applied this doctrine to hold that the rule could not be invoked against the private respondents, who were strangers to the deed executed between Leoncia Lasangue and Victoria Lechugas, so the vendor's parol testimony as to what she actually intended to sell was admissible.
• No Change of Theory on Appeal — A party may not be charged with changing its theory on appeal where the position it advances was already raised in its defenses in the court of origin. The Court found that the respondents had consistently questioned Leoncia Lasangue's capacity to sell the disputed lot and had already attacked the validity of Exhibit A in their affirmative defense, so no change of theory occurred.
• Respect for Findings of Fact of Lower Courts — Where there is strong, clear, and convincing evidence supporting the factual findings of both the trial court and the Court of Appeals, the Supreme Court will not reverse those findings. The Court declined to disturb the concurrent findings that Lot No. 5522 was the lot actually sold to the petitioner.

• "The parol evidence rule does not apply, and may not properly be invoked by either party to the litigation against the other, where at least one of the parties to the suit is not party or a privy of a party to the written instrument in question and does not base a claim on the instrument or assert a right originating in the instrument or the relation established thereby." — This passage, drawn from Francisco on Evidence, states the ratio decidendi: the parol evidence rule is inapplicable where a stranger to the written instrument is a party to the suit.
• ". . . Strangers to a contract are, of course, not bound by it, and the rule excluding extrinsic evidence in the construction of writings is inapplicable in such cases; and it is relaxed where either one of the parties between whom the question arises is a stranger to the written agreement, and does not claim under or through one who is party to it. In such case the rule is binding upon neither. . . ." — Quoted from Horn vs. Hansen, this passage supplies the canonical formulation of the exception to the parol evidence rule that the Court adopted.
• "The petitioner's reliance on the parol evidence rule is misplaced. The rule is not applicable where the controversy is between one of the parties to the document and third persons." — This is the Court's own application of the doctrine to the facts, explaining why the vendor's testimony was properly admitted against the petitioner.
• "From the foregoing, there can be no other conclusion but that Lasangue did not intend to sell, as she could not have sold, a piece of land already sold by her father to the predecessor-in-interest of the respondents." — This passage captures the decisive factual finding that resolved the identity of the lot actually conveyed.

• Horn vs. Hansen, 57 N.W. 315 — Cited for the rule that strangers to a contract are not bound by it and that the rule excluding extrinsic evidence in the construction of writings is inapplicable where either party between whom the question arises is a stranger to the written agreement.
• Camacho vs. Municipality of Baliuag, 28 Phil. 466 — Cited to illustrate that parol evidence introduced by the municipality was competent to defeat the terms of the plaintiff's deed, which the latter had executed with the Insular Government, there being no written instrument between the plaintiff and the municipality; the Court quoted Justice Moreland's concurring opinion to the effect that no question of varying or contradicting a written instrument could arise between parties who had no written instrument between them.

Feria (Chairman), Fernan, Alampay, and Paras, JJ., concur.