G.R. No. 222616 April 3, 2019
SPOUSES LUCIA A. OROZCO and CRESENTE R. OROZCO (DECEASED), substituted by his heirs, Petitioners, vs. FLORANTE G. LOZANO, SR. (DECEASED), substituted by his heirs, Respondents.

FACTS

Petitioners Spouses Orozco purchased two residential lots in 1980. On September 4, 1980, they sold half of Lot No. 3780 to respondent Florante Lozano, Sr. for ₱5,000.00. The half sold was designated Lot 3780-A, while the retained portion was Lot 3780-B. The sale was based on a rope measurement by Cresente Orozco, who believed the entire lot contained 570 square meters, making the half sold 285 sq.m. Lozano subsequently constructed a boarding house straddling the boundary. The spouses did not initially object, believing the structure was within the sold portion.
A dispute arose when Lozano presented an acknowledgment receipt dated April 24, 1981, indicating an additional payment of ₱400 for an extra 62 square meters of land from the Orozcos’ retained portion, with a total agreed price of ₱1,000 for this addition. The Orozcos denied selling any additional area, claimed the signature on the receipt was forged, and demanded Lozano vacate what they alleged was an encroachment of 111 square meters on Lot 3780-B. After failed barangay conciliation, the Orozcos filed a complaint for Recovery of Possession and Damages.

ISSUE

The core issue was whether a valid contract of sale was perfected for the additional 62-square-meter portion of Lot No. 3780-B, thereby precluding a finding of encroachment by Lozano.

RULING

The Supreme Court denied the petition and affirmed the rulings of the Court of Appeals and the Regional Trial Court, upholding the existence of a perfected contract of sale for the additional area. The legal logic centered on the nature of the original sale and the validity of the subsequent agreement. The Court characterized the initial sale of “half of Lot No. 3780” as a sale of a determinate part of an immovable in a mass, citing Article 1542 of the Civil Code. In such a sale, where the area stated (285 sq.m.) is less than the actual area within the designated boundaries, the vendor is obligated to deliver all the land within those boundaries. A subsequent survey revealed the entire Lot No. 3780 actually contained 651 sq.m., meaning the one-half portion sold (Lot 3780-A) encompassed 325.5 sq.m., not 285 sq.m.
Consequently, Lozano was already entitled to 325.5 sq.m. The acknowledgment receipt for the additional 62 sq.m. constituted a separate, perfected contract of sale. The Court found the essential elements of consent, object, and price were present. The Orozcos’ consent was established by the receipt, and their claim of forgery failed. The testimony of a document examiner confirmed the signature on the receipt matched Cresente Orozco’s admitted signature on the original deed of sale. Therefore, Lozano lawfully occupied the total area of 387.5 sq.m. (325.5 sq.m. + 62 sq.m.), and there was no encroachment. The Court ordered Lozano’s heirs to pay the remaining ₱300 balance of the purchase price for the added portion with stipulated interest.