AGRIPINO DE OCAMPO ET AL., PLAINTIFFS AND APPELLEES, VS. JUAN ZAPORTEZA ET AL., DEFENDANTS AND APPELLANTS.

The instant appeal seeks the reversal of the judgment appealed from,
holding that the contract Exhibit A is a mortgage rather than a sale
subject to repurchase.

The action brought prayed that said contract Exhibit A be annulled by the court.

The main question discussed by the parties both in the court below
and in this instance is: Whether or not the instrument Exhibit A
expresses the true agreement entered into by and between the parties.

The appellants maintain that the trial court erred in holding that
the instrument Exhibit A is a mortgage deed, and not a deed of sale
subject to repurchase, contending that the parties herein submitted an
agreed statement of facts wherein it appeared that the appellees
executed the instrument Exhibit A in favor of the appellants; and
alleging, moreover, that they received the price of the sale, and that
there was no fraud in the execution of the instrument in question.

It is true that the deed in question apparently evidences an
agreement of a sale subject to repurchase; but as the
plaintiffs-appellees have put in issue a mistake of said writing, and
its failure to express the true intent and agreement of the parties,
the presumption established in section 285 of the Code of Civil
Procedure depends on the evidence in the case. And the plaintiffs’
evidence shows: (1) That the portion of land conveyed to the defendants
by the plaintiffs, added to that conveyed to them by the deceased
Alejandro de Ocampo, only comprises an area of land planted with 700
coconut trees; and (2) that the conveyance by Alejandro de Ocampo, and
that subsequently made by the plaintiffs, were only to secure the
amount of P1,000 received by the former, and the other amount of P2,000
furnished by the same defendant to pay off a debt of the deceased to
the National Bank (P1,604.44), and funeral expenses, (P400).

The plaintiffs contend, by means of witnesses Agripino and Gregorio
de Ocampo, that the contract between the parties is in reality a simple
mortgage, but was made to appear as if it were a sale, subject to
repurchase, at the suggestion of Nazario P. de Mesa, the attorney for
the defendants, who told them that, as it was a question between
brothers, there was no objection to drawing up the deed in that form;
whereas, if the agreement were evidenced as a loan, the defendants
might appear in a bad light if the transaction were not dissimulated,
in view of which, the plaintiffs consented to sign the instrument. The
trial court states in its judgment that it was convinced that said
plaintiffs gave a substantially correct account of the conversations
between the parties which preceded the execution of the document in
question, and we are of opinion that this is supported by the evidence.

It should here be noted that when, in March, 1924, the instrument
Exhibit A was executed, the decree adjudicating lot No. 4210, which
includes the two parcels of land in question, in the registration
proceeding thereof, had not yet been issued, such issuance having taken
place on August 31, 1925, in favor of Agripino de Ocampo and others. On
January 27, 1926, the trial court that took cognizance of the
registration proceeding, amended its decree, on motion of the
defendants, by including therein the lien of a sale subject to
repurchase for P3,000 for the period of three years from the 4th of
March, 1924. On June 18, 1926, the original certificate was issued in
favor of those to whom the lot was adjudicated in accordance with the
amended decree. And, subsequently, on September 14, 1927, the
certificate of transfer (Exhibit 1) was issued in favor of the
defendants.

It is a fact duly proven in the proceedings that the certificate of
transfer in favor of the defendants includes not only the two parcels
described in the instrument Exhibit A, planted with 700 coconut trees,
but all of lot No. 4210, which, according to the evidence, contains
2,000 coconut trees. Therefore, it is evident that the certificate of
transfer, Exhibit 1, in so far as it includes a portion of land planted
with 1,300 coconut trees, to which the defendants are not at all
entitled, should not be given legal effect, especially when said
certificate of transfer has been obtained by the defendants during the
pendency of the present action wherein the value of the instrument
Exhibit A is precisely the matter in dispute.

In view of the foregoing, we are of opinion, and so hold, that the
instrument Exhibit A does not express the true contract entered into by
the parties, and taking for granted that Exhibit 1 is valid, we hold,
nevertheless, that as the defendants obtained the amendment of the
decree of adjudication by means of said instrument, and having,
furthermore, obtained the certificate of transfer of title knowing that
only two parcels of lot No. 4210 had been transferred to them,
application must here be made of the doctrines upheld in the cases of
Uy Aloe vs. Cho Jan Ling (19 Phil., 202); Camacho vs. Municipality of Baliuag (28 Phil., 466); and Severino vs.
Severino (44 Phil., 343), to the effect that the defendants only hold
the certificate of transfer in trust for the plaintiffs with respect to
the portion of the lot planted with 1,300 coconut trees; and they are
therefore bound to execute a deed in favor of the plaintiff,
transferring to them said portion planted with 1,300 coconut trees.

With regards to the two portions described in the instrument Exhibit
A, we affirm the judgment appealed from, ruling that within ninety days
from the date this decision becomes final, the administrator of the
estate of the deceased Alejandro de Ocampo must redeem the land which
is the subject matter of the contract, paying the sum of P3,000 to the
defendants, who shall restore said land to the administrator, provided
that if the administrator fails to exercise this right within the
period fixed, the ownership of the land described in the deed Exhibit A
shall be consolidated in the defendants. So ordered.

Avanceña, C, J., Johnson, Street, Johns, Romualdez, and Villa-Real, JJ., concur.