G.R. No. 121506. October 30, 1996.
Mactan Cebu International Airport Authority, petitioner, vs. Court of Appeals, Regional Trial Court, Branch 9, Cebu City, Melba Limbaco, Linda C. Logarta and Ramon C. Logarta, respondents.

FACTS

In 1949, the National Airport Corporation (NAC), petitioner’s predecessor, acquired lands surrounding Lahug Airport for its expansion. Landowners, including Inez Ouano, were persuaded to sell with assurances that their properties would be returned if no longer needed for airport purposes. While some deeds contained a formal “rider” guaranteeing this right of repurchase, Inez Ouano’s deed did not. However, testimonial evidence established that she sold her lots based on the same oral promise, having been assured that the government would otherwise expropriate them.
Decades later, upon learning of the planned transfer of airport operations to Mactan and that other landowners with riders had successfully repurchased their properties, Ouano’s heirs (private respondents) sought to repurchase the lots. Petitioner MCIAA denied the request, citing the absence of a repurchase clause in the written deed. Private respondents then filed an action for reconveyance.

ISSUE

Whether the right to repurchase can be established by parol evidence despite its absence in the written deed of sale, and whether the Statute of Frauds bars its enforcement.

RULING

The Supreme Court denied the petition, affirming the lower courts’ decisions. The right of repurchase was validly established by parol evidence. The parol evidence rule, which generally prohibits varying the terms of a written agreement, admits exceptions. A party may present evidence to prove that a written agreement does not express the true intent of the parties. Here, private respondents successfully proved that the oral promise of repurchase was the inducing cause for Inez Ouano to enter into the sale. The circumstances were identical to sales of adjacent lots which contained explicit riders, and no evidence showed Ouano’s lots were acquired under different terms. Furthermore, petitioner waived any objection to this parol evidence by failing to timely protest its admission during trial.
The Statute of Frauds is inapplicable. The deed of sale itself serves as the written memorandum evidencing the contract. The oral repurchase agreement was a collateral part of this consummated sale, not a separate contract. The Statute of Frauds applies only to executory contracts. Here, the contract was partially executed—the sale was completed and petitioner accepted the benefits—thus removing it from the statute’s scope. The Court emphasized that the Statute of Frauds exists to prevent fraud, not to be used as an instrument for its perpetration.