When, there having been a meeting of the minds of the parties to a contract, their true intention is not expressed in the instrument purporting to embody the agreement, by reason of mistake, fraud, inequitable conduct or accident, one of the parties may ask for the reformation of the instrument to the end that such true intention may be expressed.
If mistake, fraud, inequitable conduct, or accident has prevented a meeting of the minds of the parties the proper remedy is not reformation of the instrument but annulment of the contract. (n)
Kapag mayroong pagkaka sama ng mga pag iisip ng mga partido ng kontrata at ang kanilang tamang layunin ay hindi pinahayag sa instrumentong nagbibigay ng tamang kahulugan na kumakatawan sa kasunduan, dahil sa pagkakamali, panloloko at hindi magkaparehas na pagsasa ayos ng mga bagay o aksidente, ang isang partido ay maaring humiling ng reformation ng instrumento hanggang sa huli para ang tamang layunin ay maipahayag.
Kung ang pagkakamali, panloloko at hindi magkaparehas na pagsasa ayos ng mga bagay or aksidente ay pumipigil sa pagsasama sama ng mga pag iisip ng mga partido, ang tamang solusyon ay hindi reformation ng instrumento ngunit pagpapasawalang bisa ng kontrata.
Discussion:
Par. 1 [Ill. In a contract of construction of a building, the parties agreed that payment in dollars. The dollar sign was used in the original draft. However what was typewritten in the contract, occassioned by mistake, was the peso sign. Reformation was ordered by the court.
Par. 2 [Ill. Where a party is leasing his property to another, the latter through fraud was able to make him sign an absolute deed of sale, the action is not for reformation but for annulment of the instrument.
Reformation is a remedy in equity by means of which a written instrument is made or construed so as to express or confirm the real intention of the parties when some error or mistake is committed.
It would be unjust and inequitable to allow the enforcement of a written instrument which does not reflect or disclose the real meeting of the minds of the parties. The rigor of the legallistic rule that a written instrument should be the final and inflexible criterion and measure of the rights and obligations of the contracting parties is thus tempered, to forestall the effects of of mistake, fraud, inequitable conduct, or accident.
The court which orders the reformation of the instrument does not make a new contract for the participating parties in the document but merely orders that the instrument express their true agreement.
Requisites of Action for Reformation
1.There is a contract agreed upon where there is a meeting of the minds
2.The real intention of the parties was not expressed in the instrument.
3.The reason for the instrument to express the real intention of the parties is mistake, fraud, inequitable conduct or accident did not prevent the meeting of the minds of the parties.
4.The said intervening mistake, fraud, inequitable conduct or accident did not prevent the meeting of the minds of the parties.
Case Illustration: Jayme, et al. Vs Alampay, et al 62 SCRA 131
Obligations and Contracts 