Orozco v Lozano

G.R. No. 222616. April 3, 2019

Justice Carpio
Topic: Sales; Sale of a lump sum
Nature of the case: Complaint for Recovery of Possession and Damages

FACTS:
1. Spouses Cresente R. Orozco and Lucia A. Orozco (Spouses Orozco) purchased from
Spouses Reynaldo and Floriana Fuentes (Spouses Fuentes) two residential lots both
situated in Barangay 2, San Francisco, Agusan del Sur. The lots are identified as Lot No.
3780, Pls-67 and Lot No. 3105, Pls-67. On 4 September 1980, Spouses Orozco sold half
of Lot No. 3780 to Florante G. Lozano, Sr. (Lozano) for P5,000.00. Half of Lot No. 3780
which was sold by Spouses Orozco to Lozano was assigned as Lot No. 3780-A while the
other half retained by Spouses Orozco was designated as Lot No. 3780-B. At the time of
the sale, Cresente Orozco (Orozco) used a rope to measure Lot No. 3780, which Orozco
thought had an area of 570 square meters. Lozano constructed a building between Lot
No. 3780-A and Lot No. 3780-B which Lozano used as a boarding house. 7
2. Lozano claimed that Spouses Orozco agreed to sell to him an additional 62 square
meters of Spouses Orozco's 325.5 square meters portion and that Lozano agreed to
make an additional payment of P1,000.00 in consideration for the said added portion.
Lozano paid Spouses Orozco P400.00. Subsequently, Lozano paid Spouses Orozco
P300.00, totaling P700.00, leaving P300.00 as the remaining unpaid balance for the 62
square meters added portion. Without receiving the full payment, Spouses Orozco made
repeated demands to Lozano to vacate the portion of Spouses Orozco's lot that Lozano
allegedly encroached upon but the latter refused to vacate. Spouses Orozco and Lozano
then brought their dispute for barangay conciliation.
3. On 2 September 1998, Spouses Orozco filed a complaint for Recovery of Possession and
Damages with Application for Writ of Preliminary Injunction
4. MTC ruled in favor of Orozco, ordering Lozano to vacate the lot and to restore
possession of the said portion to Orozco. RTC reversed, holding that there was a valid
contract of sale between the parties. Where both the area and the boundaries of an
immovable are declared, the area covered within the boundaries prevails over the
stated area in the deed of sale. Through the perfected contract of sale, Spouses Orozco
bound themselves to deliver to Lozano one-half of the actual area within the said
boundaries of Lot No. 3780. Moreover, Orozco was not able to prove that his signature
in the subject acknowledgment receipt was forged. CA affirmed the RTC.

ISSUE: Whether there was a perfected contract of sale of lump sum. YES.
RATIONALE:
1. The contract of sale between Spouses Orozco and Lozano completely transferred
the title of ownership of half of Lot No. 3780.
a. Considering that the object of the deed of sale was half of Lot No. 3780,
there is no encroachment on the part of Lozano because the sale of Lot No.
 3780 was a sale of land made for a lump sum under Article 1542 of the Civil
Code.
b. Hence, Lozano owns half of 651 square meters of Lot No. 3780 which is 325.5
square meters assigned as Lot No. 3780-A. Second, there was a subsequent
perfected contract of sale for an additional portion of 62 square meters of
Lot No. 3780-B from Spouses Orozco to Lozano.
2. The sale of Lot No. 3780 between Spouses Orozco and Lozano is a sale of land in a
lump sum under Article 1542 of the Civil Code.
a. Article 1542 provides that when a contract of sale concerns the delivery of a
determinate object, particularly real estate, in consideration for a lump sum
payment, the vendor has the obligation to deliver everything within the
boundaries even when it exceeds the area or number specified within the
said boundaries.
b. Upon delivery, if the area of the real estate set forth in the contract does not
coincide with the actual area delivered within the boundaries, Article 1542
provides that there shall be no increase or decrease in the price even if the
area be more or less than that indicated in the contract of sale. Under Article
1542, the determinate object of the contract of sale and the property to be
delivered is the particular portion of the real estate enclosed within the
boundaries mentioned in the contract of sale.
3. Article 1539 of the Civil Code refers to a sale of real estate made with a statement
of the real estate's area at the rate of a certain price for a unit of measure or
number.
a. In a sale involving real estate the parties may choose between two types of
pricing agreements: a unit price contract under Article 1539 where the
purchase price is determined by way of reference to a stated rate per area
(e.g., P1,000.00 per square meter), or a lump sum contract under Article
1542 which states a full purchase price for an immovable the area of which is
based on the boundaries stated in the contract of sale.
b. Where both the area and the boundaries of the immovable are declared, the
area covered within the boundaries of the immovable prevails over the
stated area. In cases of conflict between areas and boundaries, it is the latter
which should prevail. What really defines a piece of ground is not the area,
calculated with more or less certainty, mentioned in its description, but the
boundaries therein laid down, as enclosing the land and indicating its limits.
c. In a contract of sale of land in a mass, it is well established that the specific
boundaries stated in the contract must control over any statement with
respect to the area contained within its boundaries. It is not of vital
consequence that a deed or contract of sale of land should disclose the area
with mathematical accuracy. It is sufficient if its extent is objectively
indicated with sufficient precision to enable one to identify it. An error as to
the superficial area is immaterial. Thus, the obligation of the vendor is to
deliver everything within the boundaries, inasmuch as it is the entirety
thereof that distinguishes the determinate object
 d. In a contract of sale of real estate contained in a land mass under Article
1542, the specific boundaries stated in the contract must control over any
statement with respect to the area contained in the said boundaries.
4. There was a subsequent perfected contract of sale between Spouses Orozco and
Lozano for an additional 62 square meters of Lot No. 3780-B.
a. In the present case, there was a perfected contract of sale for the 62 square
meters portion of Lot No. 3780-B from Spouses Orozco to Lozano. There was
a meeting of the minds between Spouses Orozco and Lozano when the latter
offered to purchase for P1,000.00 an additional 62 square meters of Lot No.
3780-B from Spouses Orozco to extend the boundary of his property, Lot No.
3780-A, up to the mango tree. Lozano's offer was accepted by Spouses
Orozco and the initial payment of P400.00 was made by Lozano as evidenced
by the handwritten acknowledgment receipt dated 24 April 1981 signed by
Orozco. Subsequently, another payment of P300.00 by Lozano was made to
Lucia Orozco, totaling the payment of Lozano to P700.00, leaving a remaining
unpaid balance of P300.00, before the dispute was brought to the barangay
by Spouses Orozco for resolution.
b. As a rule, forgery cannot be presumed and must be proved by clear, positive,
and convincing evidence. The burden of proof lies on the party alleging
forgery. 24 One who alleges forgery has the burden to establish his case by a
preponderance of evidence, or evidence which is of greater weight or more
convincing than that which is offered in opposition to it. The fact of forgery
can only be established by a comparison between the alleged forged
signature and the authentic and genuine signature of the person whose
signature is theorized to have been forged