G.R. No. 185530 . April 18, 2018.
MAKATI TUSCANY CONDOMINIUM CORPORATION, PETITIONER, VS. MULTI-REALTY DEVELOPMENT CORPORATION, RESPONDENT.

FACTS

Multi-Realty Development Corporation built the Makati Tuscany condominium. The 1975 Master Deed it executed allocated 270 parking slots: one per ordinary unit, two per penthouse unit, and the remaining 106 slots as part of the common areas. The common areas were later transferred to Makati Tuscany Condominium Corporation (MATUSCO) per the Condominium Act. In 1990, Multi-Realty filed a complaint for reformation of instrument, claiming that of the 106 common area slots, only eight were intended as guest parking. It asserted that it retained ownership of the other 98 slots, but this true intention was mistakenly not reflected in the Master Deed, a document of “first impression” for an early condominium project.
The Regional Trial Court dismissed the complaint, finding no basis for reformation. The Court of Appeals initially dismissed the appeal on grounds of prescription, but the Supreme Court reversed, directing a resolution on the merits. On remand, the Court of Appeals denied Multi-Realty’s appeal, upholding the trial court. Multi-Realty elevated the case to the Supreme Court.

ISSUE

Whether the Court of Appeals erred in denying Multi-Realty’s action for the reformation of the Master Deed to reflect its claimed ownership over the 98 parking slots.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals. Reformation requires clear and convincing proof of a meeting of the minds that is not expressed in the instrument due to mistake, fraud, inequitable conduct, or accident. The Court found that Multi-Realty failed to present such proof. The Master Deed, which Multi-Realty itself prepared, unambiguously designated the 98 disputed slots as part of the common areas. Its clear language prevails.
The Court rejected Multi-Realty’s claim of a mutual mistake. Its sole evidence was the self-serving testimony of its officer, unsupported by any contemporaneous document showing a different agreement with MATUSCO’s predecessors-in-interest (the unit buyers). Subsequent acts, like Multi-Realty’s separate sales of some parking slots, did not prove a prior mutual mistake but were unilateral acts inconsistent with the Master Deed. Reformation is not available to correct a party’s own unilateral error in drafting. The instrument expressed the true agreement, and Multi-Realty was bound by its own deed.