The Parol Evidence Rule excludes parol or extrinsic evidence by which a party seeks to contradict, vary, add to or subtract from the terms of a valid agreement or instrument. Thus, it appears that what the CA actually applied in its assailed Decision when it refused to look beyond the words of the contracts was the Parol Evidence Rule, not the BestEvidence Rule. The appellate court gave primacy to the literal terms of the two contracts and refused to admit any other evidence that would contradict such terms.
However, even the application of the Parol Evidence Rule is improper in the case at bar. In the first place, respondents are not parties to the VLTs executed between RBBI and petitioners; they are strangers to the written contracts. Rule 130, Section 9 specifically provides that parol evidence rule is exclusive only as "between the parties and their successors-in-interest." The parol evidence rule may not be invoked where at least one of the parties to the suit is not a party or a privy of a party to the written document in question, and does not base his claim on the instrument or assert a right originating in the instrument.[44]
Moreover, the instant case falls under the exceptions to the Parol Evidence Rule, as provided in the second paragraph of Rule 130, Section 9:
Here, the petitioners' VLTs suffer from intrinsic ambiguity. The VLTs described the subject property as covered by TCT No. T-62836 (Lantap property), but they also describe the subject property as being located in "Barangay Murong." Even the respondents' Deed of Sale falls under the exception to the Parol Evidence Rule. It refers to "TCT No. T-62096" (Murong property), but RBBI contended that the true intent was to sell the Lantap property. In short, it was squarely put in issue that the written agreement failed to express the true intent of the parties.
However, even the application of the Parol Evidence Rule is improper in the case at bar. In the first place, respondents are not parties to the VLTs executed between RBBI and petitioners; they are strangers to the written contracts. Rule 130, Section 9 specifically provides that parol evidence rule is exclusive only as "between the parties and their successors-in-interest." The parol evidence rule may not be invoked where at least one of the parties to the suit is not a party or a privy of a party to the written document in question, and does not base his claim on the instrument or assert a right originating in the instrument.[44]
Moreover, the instant case falls under the exceptions to the Parol Evidence Rule, as provided in the second paragraph of Rule 130, Section 9:
However, a party may present evidence to modify, explain or add to the terms of the written agreement if he puts in issue in his pleading:
(1) An intrinsic ambiguity, mistake or imperfection in the written agreement;
(2) The failure of the written agreement to express the true intent and agreement of the parties thereto;
x x x x (Emphasis supplied)
Here, the petitioners' VLTs suffer from intrinsic ambiguity. The VLTs described the subject property as covered by TCT No. T-62836 (Lantap property), but they also describe the subject property as being located in "Barangay Murong." Even the respondents' Deed of Sale falls under the exception to the Parol Evidence Rule. It refers to "TCT No. T-62096" (Murong property), but RBBI contended that the true intent was to sell the Lantap property. In short, it was squarely put in issue that the written agreement failed to express the true intent of the parties.
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