Art.

92 what are excluded from the community

property (89)
Art. 116 Conjugal partnership property

Article 121 (2) Charges upon and obligation of the

conjugal partnership (00,06)
1. Ayala Investments vs. CA
286 SCRA 272
-The benefits must be one directly resulting from
the loan. It cannot merely be a by-product or a
spin-off of the loan itself.
-Benefits such as prospects of longer employment and probably
increase in the value of stocks might have been already
apparent or could be anticipated at the time the accommodation
agreement was entered into are not only incidental but also
speculative and too small to qualify the transaction as one for
the benefit of the suretys family.
-While the husband derives salaries, dividend benefits from
PBM (the debtor corporation), only because said husband is an
employee of said PBM. These salaries and benefits are not the
benefits contemplated by Articles 121 and 122 of the Family
Code. The benefits contemplated by the exception in Art. 122
(Family Code) are those benefits derived directly from the use
of the loan. In the case at bar, the loan is a corporate loan
extended to PBM and used by PBM itself, not by petitionerappellee-husband or his family.
2. CARLOS vs. ABELARDO
380 SCRA 361
-May the husband notwithstanding his alleged lack
of consent in obtaining a loan be held solidarily liable for
such together with the wife?
-

While respondent did not and refused

to sign the acknowledgment executed
and signed by the wife, undoubtedly,
the loan redounded to the benefit of
the family because it was used to
purchase the house and lot that
became the conjugal home of
respondent and his family. Hence,
notwithstanding the alleged lack of
consent of respondent, under Article
121 of the Family Code, shall be
solidarily liable for such loan together
with his wife.
3. CHING vs. COURT OF APPEALS
423 SCRA 357
Facts: On September 28, 1978, Philippine
Blooming Mills Company, Inc. (PBMCI) obtained a 9-million
peso loan from Allied Banking Corporation (ABC). As added
security for the loan, Alfredo Ching together with 2 other
persons executed a continuing guaranty with ABC binding
themselves to jointly and severally guarantee the payment
of all the PBMCI obligations owing the ABC to the extent of
38 million pesos. PBMCI defaulted in the payment of its loans
which, exclusive of interests, penalties and other bank
charges amounted to P12,612,972.88. After the issuance of a
writ of preliminary attachment the sheriff then levied the
100,000 common shares of CityCorp. stocks registered solely
in the name of Alfredo Ching. The wife of Mr. Ching then
moved to set aside the levy on attachment claiming that the
100,000 shares of stocks were acquired by her and her
husband during the marriage out of conjugal funds after the
CityCorp Investment Philippines was established in 1974.
Furthermore, the indebtedness did not redound to the
benefit of the conjugal partnership.
Is the argument of Mrs. Ching tenable?

Ruling: The barefaced fact that the shares of

stocks were registered in the corporate books of CityCorp
Investment solely in the name of Alfredo does not constitute
proof that the husband, not the conjugal partnership, owned
the same. It was, thus, the burden of ABC to prove that the
source of the money utilized in the acquisition of the shares
of stocks was that of the husband alone. ABC failed to
adduce evidence to prove this assertion. In AIDC vs. CA, this
Court ruled that the signing as a surety is certainly not an
exercise of an industry or profession. It is not embarking in a
business. No matter how often an executive acted on or was
persuaded to act as surety for his own employer, this should
not be taken to mean that he thereby embarked in the
business of guaranty or suretyship.
For the conjugal partnership to be liable for a
liability that should appertain to the husband alone, there
must be a showing that some advantages accrued to the
spouses. No presumption can be inferred that when a
husband entered into an accommodation agreement or a
contract of surety, the conjugal partnership would thereby
be benefited.
It could be argued that Alfredo was a member of
the Board of Directors of PBMCI and was one of the top 20
stockholders, and that his shares of stocks and his family
would appreciate if the PBMCI could be rehabilitated through
the loans obtained; that Alfredos career would be enhanced
should PBMCI survive because of the infusion of fresh capital.
However, these are not the benefits contemplated by Article
161 of the Civil Code (Article 121 FC). The benefits must be
those directly resulting from the loan. They cannot merely a
by-product or a spin-off of the loan itself (citing AIDC vs. CA).

Article 124 Administration of the conjugal partnership property (00)

HOMEOWNERS SAVINGS & LOAN BANK vs.
MIGUELA C. DAILO
453 SCRA 283
Spouses Dailo purchased a house and lot situated
at San Pablo City and had it titled in the name of the husband
alone. In 1993, the husband obtained a P300,000-peso loan
from Homeowners secured by the house and lot. With the loan
unpaid, the bank foreclosed the security. For failure to redeem,
Homeowners consolidated ownership over the property. In
1995, the husband died and the wife found out about the
mortgage, foreclosure and consolidation. Claiming absence of
knowledge of the loan obligation, the wife filed an action to
annul the mortgage, certificate of sale, etc. Homeowners moved
for the dismissal of the petition on the ground that the property
is the exclusive property of the husband having been titled in
the husbands name alone. That assuming that the property is
conjugal, Article 124 of the FC should be construed in relation
to Article 493 of the Civil Code on co-ownership where the coowner may alienate, assign or mortgage and even substitute
another person in its enjoyment but the effect of the alienation
or the mortgage shall be limited to the portion which may be
allotted to him in the division upon termination of the coownership. Moreover, the loan redounded to the benefit of the
family as the proceeds thereof were used to fund the husbands
subdivision projects.
Held: In Guiang vs. CA, it was held that the sale of
a conjugal property requires the consent of both the husband
and wife. In applying Article 124 of the Family Code, this
Court declared that the absence of the consent of one renders
the entire sale null and void, including the portion of the
conjugal property pertaining to the husband who contracted the
sale. The same principle squarely applies to the instant case. In
the absence of a marriage settlement, the system of conjugal
partnership of gains governed the property relations between
the spouses. The rules on co-ownership do not even apply to the
property relations of Marcelino and Miguela even in a
suppletory manner. The conjugal partnership of gains is a
special type of partnership, where the husband and wife place in
a common fund the proceeds, products, fruits and income from
their separate properties and those acquired by either or both
spouses their efforts or by chance. Unlike the absolute

community of property wherein the rules on co-ownership

apply in a suppletory manner, the conjugal partnership shall be
governed by the rules on partnership in all that is not in conflict
with what is expressly determined in the chapter or by the
spouses in their marriage settlements.
The basic and established fact is that during his
lifetime, without the knowledge and consent of his wife,
Marcelino constituted a real estate mortgage on the subject
property, which formed part of their conjugal partnership. By
express provision of Article 124 of the Family Code, in the
absence of court authority or written consent of the other
spouse, any disposition or encumbrance of the conjugal
property is void. The aforequoted provision does not qualify
with respect to the share of the spouse who makes the
disposition or encumbrance. Where the law does not
distinguish, courts should not distinguish.
The burden of proof that the debt was contracted
for the benefit of the conjugal partnership lies with the creditor
claiming as such. Petitioners sweeping conclusion that the loan
obtained by Marcelino to finance the construction of housing
units without a doubt redounded to the benefit of his family is
without adequate proof. Other than petitioners bare allegation,
there is nothing from the records to compel a finding that,
indeed, the loan redounded to the benefit of the family.
GUIANG vs. CA
291 SCRA 372
-Court applied Art. 124 of the Family Code.
-Any alienation or encumbrance made after August 3, 1988
when the Family Code took effect by the husband of the
conjugal partnership property without the consent of the wife is
null and void. Such contract is void as one of the essential
elements of a contract is absent.
- Neither can the amicable settlement be considered a
continuing offer that was accepted and perfected by the parties,
following the last sentence of Article 124. The order of events is
clear: after the sale, Guiang filed a complaint for trespassing
against Corpuz, after which the barangay authorities secured an
amicable settlement. The settlement however, does not
mention a continuing offer to sell the property or an acceptance
of such a continuing offer. Its tenor was to the effect that
Corpuz would vacate the property. By no stretch of the
imagination, can the Court interpret this document as the
acceptance mentioned in Article 124.
HEIRS of AYUSTE vs. CA and MALABONGA
313 SCRA 493
-As the alienation was made prior to the effectivity
of the Family Code, the Court applied Art. 173 of
the Civil Code.
-Contract is voidable but spouse must bring the action for
annulment within 10 years from execution of the contract and
during the subsistence of the marriage.
MANALO vs. CAMAISA
374 SCRA 361
-Whether or not the husband may validly dispose a
conjugal property without the wifes written consent?
Facts: Manalo was interested to buy the Taytay and Makati
properties of spouses Camaisa. During the negotiations for the sale of the
parcels of land both spouses were present and that Manalo and Mr. Camaisa
came to an agreement as to the price and the terms of the payment, and a
down payment was made but the wife of the vendor refused to sign the
contracts to sell. Having been aware of the transactions Manalo argues that
Norma Camaisa had consented to the transaction. And if she unjustly refused
to affix her signature to the contracts to sell, court authorization under
Article 124 of the Family Code is warranted.
Held: The law requires that the disposition of a conjugal property by the
husband as administrator in appropriate cases require the written consent of
the wife; otherwise, the disposition is void. The properties, subject of the
contracts were conjugal; hence, for the contracts to sell to be effective, the
consent of both husband and wife must concur. Norma may have been aware
of the negotiations for the sale of their conjugal properties but being merely
aware of a transaction is not consent. While Manalo is correct insofar as she
alleges that if the written consent of the other spouse cannot be obtained or
is being withheld, the matter may be brought to court which will give the

same if warranted by the circumstances. However, it should be stressed that

court authorization under Art. 124 is only resorted to in cases where the
spouse who does not give consent is incapacitated. In this case Manalo failed
to allege and prove that Norma was incapacitated to give her consent to the
contracts. In the absence of such showing of the wifes incapacity, court
authorization cannot be sought.
HEIRS OF REYES vs. MIJARES
410 SCRA 97
If the sale of the conjugal real property is annullable, should it
be annulled in its entirety or only with respect to the share of the spouse who
did not give consent?
-The SC citing Paulino vs. Bucoy (131 Phil 790) held that the
plain meaning attached to the plain language of the law is that the contract,
in its entirety, executed by the husband without the wifes consent, may be
annulled by the wife. Had Congress intended to limit such annulment in so
far as the contract shall prejudice the wife, such limitation should have
been spelled out in the statute. To be underscored here is that upon the
provisions of Articles 161, 162 and 163 of the Civil Code, the conjugal
partnership is liable for many obligations while the conjugal partnership
exists. Not only that. The conjugal partnership is even subject to the
payment of debts contracted by either spouse before the marriage, as those
for the payment of fines and indemnities imposed upon them after the
responsibilities in Article 161 have been covered, if it turns out that the
spouse who is bound thereby, should have no exclusive property or if it be
insufficient. These are the considerations that go beyond the mere equitable
share of the wife in the property. These are reasons enough for the husband
to be stopped from disposing of the conjugal property without the consent of
the wife. Even more fundamental is the fact that the nullity is decreed by the
Code not on the basis of prejudice but lack of consent of an indispensable
party to the contract under Article 166.
A sale or encumbrance of conjugal or (community) property
concluded after the effectivity of the Family Code on August 3, 1988, is
governed by Article 124 of the same Code that now treats such a disposition
as void if done without the conjoint consent of the spouses or, in case of a
spouses inability, the authority of the court (footnote).
PELAYO vs. PEREZ
459 SCRA 475
In January 1988, Pelayo, by a deed of absolute sale, conveyed
to Perez 2 parcels of land situated in Panabo. Lorenza, Pelayos wife, signed
only on the 3rd page in the space provided for witnesses on account of which
Perez application for registration of the deed with the office of the Register
of Deeds in Tagum was denied. Perez thereupon asked Lorenza to sign the
1st and 2nd pages of the deed but she refused, hence, he instituted an action
for specific performance.
SC: We agree with the CA ruling that Lorenza by affixing her
signature to the Deed of Sale on the space provided for witnesses, is deemed
to have given her implied consent to the contract of sale.
Sale is a consensual contract that is perfected by mere consent,
which may either be express or implied. A wifes consent to the husbands
disposition of conjugal property does not always have to be explicit or set
forth in any particular document, so long as it is given. In the present case,
although it appears on the face of the deed of sale that Lorenza signed only
as an instrumental witness, circumstances leading to the execution of said
document point to the fact that Lorenza was fully aware of the sale of their
conjugal property and consented to the sale.
Moreover, under Article 173, in relation to Article 166, both of
the New Civil Code, which was still in effect on January 11, 1988 when the
deed in question was executed, the lack of marital consent to the disposition
of conjugal property does not make the contract void ab initio but merely
voidable. Hence, it has been held that the contract is valid until the court
annuls the same and only upon an action brought by the wife whose consent
was not obtained.
DOLORES ANNO vs. ALBERT ANNO and SUANDING
January 27, 2006
Wife Dolores instituted an action for cancellation of waiver of
rights, deed of sale against her husband Albert and Suanding, Alberts
cousin. It appears that Albert executed an affidavit of waiver of rights over a
portion of a parcel of land in favor of Suanding and later sold the remaining
portion through a deed of sale to Suanding. In both documents, Albert
claimed that he is the possessor and owner of said land. According to
Dolores, the unregistered, virgin, agricultural land is a conjugal partnership
property having been acquired by them during the marriage as evidenced by
a 1974 tax declaration. They even hired the services of a caretaker to oversee
the land. Thus, Albert could not have validly conveyed the property to
Suanding without her consent.
SC: Indeed, all property of the marriage is presumed to be
conjugal in nature. However, for this presumption to apply, the party
invoking it must first prove that the property was acquired during the
marriage. Proof of acquisition during the coverture is a condition sine qua
non to the operation of the presumption in favor of the conjugal partnership.
In the case at bar, Dolores failed to substantiate by
preponderance of evidence her claim that the subject land was conjugal in
nature. She did not identify when she and her husband 1 st occupied and
possessed the land. Neither did she present any witness to prove that they 1 st
occupied the property during the marriage and that they worked on the land.
While she claimed that they also hired the services of a caretaker, records

show that the caretaker was appointed only in 1989. The initial tax
declaration she presented although dated 1974 cannot automatically be
deduced that the occupation of the subject property was likewise done in
1974. To so conclude will amount to speculation and conjecture on the part
of the court. Declaration of a land for tax purposes cannot be equated with
its acquisition for, in the ordinary course of things, occupation of a piece of
land comes before declaring it for tax purposes. The 1974 tax declaration
cannot be made a basis to prove its conjugal nature as the land was declared
for tax purposes solely in the name of Albert, who sold it as his exclusive
property. In a long line of cases, this Court held that tax declarations,
especially untitled lands, are credible proof of claim of ownership and are
good indicia of possession of an owner. Thus, the presumption of conjugal
nature of the property allegedly acquired during the subsistence of the
marriage cannot be applied.
FRANCISCO vs. GONZALES
565 SCRA 638 (September 17, 2008)
Estranged couple Cleodualdo and Michele, whose marriage was
later on voided, entered into a compromise agreement involving their
property covered by TCT No. T-167907 and located at 410 Taal St., Ayala
Alabang Village where they agreed that said conjugal property shall be
transferred by way of a deed of donation in favor of their 2 minor children
when they reach they reach 19 and 18, respectively. Meanwhile, Michele
and George Matrai were ordered by the court to vacate the premises leased
to them and to pay back rentals, unpaid telephone bills and attorneys fees. A
notice of sale by execution was then issued by the sheriff covering the
property in 410 Taal St., Ayala Alabang that was still under the name of
Cleodualdo and Michele.
SC: It should be noted that the judgment debt for which the
subject property was being made to answer was incurred by Michele and her
partner, Matrai. Gonzales alleged that the lease of the property in Lanka
Drive redounded to the benefit of the family. By no stretch of ones
imagination can it be concluded that the said debt/obligation was incurred
for the benefit of the conjugal partnership or that some advantage accrued to
the welfare to the family.
A wife may bind the conjugal partnership only when she
purchases things necessary for the support of the family, or when she
borrows money for that purpose upon her husbands failure to deliver the
needed sum; when administration of the conjugal partnership is transferred
to the wife by the courts or by the husband; or when the wife gives moderate
donations for charity. Failure to establish any of these circumstances means
that the conjugal asset may not be bound to answer for the wifes personal
obligation.
BUADO vs. CA and NICOL 586 SCRA 397 (April 24, 2009)
Erlinda Nicol was found guilty of slander and was also
adjudged to pay the sum of P35,000.00 representing moral and exemplary
damages, attorneys fees and cost. Erlindas property however, was
insufficient to answer for the liability so the sheriff levied the conjugal
property of the Nicol spouses. The husband questioned the levy and the
subsequent sale claiming that he is a stranger to the suit and hence, levy
upon the conjugal property was improper.
SC: In Spouses Ching vs. CA, this Court that the husband of the
judgment debtor cannot be deemed a stranger to the case prosecuted and
adjudged against his wife for an obligation that has redounded to the benefit
of the conjugal partnership. It must further be settled whether the obligation
of the judgment debtor redounded to the benefit of the conjugal partnership
or not.
Unlike in the system of absolute community property where
liabilities incurred by either spouse by reason of a crime or quasi-delict is
chargeable to the absolute community of property, in the absence or
insufficiency of the exclusive property of the debtor-spouse, the same
advantage is not accorded in the system of conjugal partnership of gains.
The conjugal partnership of gains has no duty to make advance
payments for the liability of the debtor-spouse.
Parenthetically, by no stretch of imagination can it be concluded
that the civil obligation arising from the crime of slander committed by
Erlinda redounded to the benefit of the conjugal partnership.
RAVINA v. VILLA ABRILLE 604 S 120 (October 16, 2009)
In 1982, spouses Pedro and Mary Ann acquired a 555-square
meter lot adjacent to the land that was acquired by Pedro while still single.
They then introduced improvements on the property. In 1991, Pedro offered
to sell the house and the 2 lots to Ravina. Mary Ann objected and notified
Ravina of her objections but Pedro, nonetheless, sold the house and 2 lots
without Mary Anns consent.
SC: The lot acquired during the marriage was conjugal in the
absence of clear, satisfactory and convincing evidence to overcome said
presumption or to prove that the subject property is exclusively owned by
Pedro.
A sale or encumbrance of conjugal property concluded after the
effectivity of the FC is void if done a.) without the written consent of both
the husband and the wife, or b.) in case of one spouses inability the
authority of the court.
If the sale is with the knowledge but without the approval of the
wife, thereby resulting in disagreement, such sale is annullable at the
instance of the wife who is given 5 years from the date of the contract
implementing the decision to institute the case.
HEIRS OF HERNANDEZ, SR. v. MINGOA, SR. 608 S 394 12/18/2009

Hernandez married to Sergia, was awarded a piece of real

property by PHHC by way of salary deduction. After full payment, TCT No.
107534 was issued to the spouses. It bears a restriction of any unauthorized
sale to 3rd persons within a certain period. The heirs learned, after
Hernandezs death in 1983 that TCT No. 107534 was cancelled in 1982 and
in lieu thereof TCT No. 290121 was issued in favor of respondents.
Apparently, Hernandez was unable to fully pay the purchase price so to
prevent forfeiture of his right to purchase, Hernandez sold his rights to
Camisura in 1963. To circumvent the prohibition, the spouses Hernandez
executed an irrevocable special power of attorney to enable Dolores to sell
the lot to Plaridel Mingoa without the need of requiring Hernandez to sign a
deed of conveyance. Plaridel then sold the property to his daughter Melanie,
then 20 years old. It was alleged that Sergias signature on the SPA was
falsified. The forgery is so blatant as to be remarkably noticeable to the
naked eye of an ordinary person. Petitioners now contend that the SPA and
the deed of sale are fictitious, hence null and void under Article 1409 of the
NCC. The declaration of the non-existence of a contract under Article 1410
does nor prescribe.
SC: Articles 1409 and 1410 are not applicable. The subject
matter involves conjugal property. The events occurred before the effectivity
of the FC. Article 173 of the NCC governs these transactions and it states:
The wife, may during the marriage, and within 10 years from the
transaction questioned, ask the courts for the annulment of any contract of
the husband entered into without her consent when such consent is required,
or any act or contract of the husband which tends to defraud her or impair
her interest in the conjugal partnership property. Should the wife fail to
exercise this right, she or her heirs, after the dissolution of the marriage, may
demand the value of the property fraudulently alienated by the husband.
The failure of Sergia to file an action for annulment of the
contract during the marriage and within 10 years from the transaction
necessarily barred her from questioning the sale of the subject property to 3 rd
persons.
FUENTES v. ROCA 618 S 702 04/21/2010
Tarciano married but separated-in-fact sold a parcel of land to
the Fuentes spouses by way of an agreement to sell. The vendees gave a
down payment with the balance to be paid as soon as Tarciano clears the lot
of structures an occupants and secure the consent of the estranged spouse
Rosario to the sale. Allegedly, Atty. Plagata worked on the requirements
including Rosarios consent to the sale. He alleged that Rosario signed the
affidavit of consent in Manila but notarized it in Zamboanga City. Tarciano
then executed a deed of absolute sale in favor of the Fuentes spouses.
When Tarciano and Rosari died in 1990, their children, in 1997,
filed an action for annulment of sale and reconveyance of the land claiming
that the sale was void since Rosario did not give consent to the sale. Her
signature on the affidavit was forged.
SC: Rosario had been living separately from Tarciano for 30
years since 1958, it would have been quite tempting for Tarciano to just
forge her signature and avoid the risk that she would not give her consent to
the ale or demand a stiff price for it.
The affidavit of consent has a defective notarization that strip
the document of its public character and reduce it to a private instrument, a
falsified jurat, taken together with the marks of forgery in the signature,
dooms such document as proof of Rosarios consent to the sale of the land.
While Tarciano and Rosario got married in 1950, the property
was sold on January 11, 1989, a few months after the FC took effect on
August 3, 1988. Article 124 of the FC provides that without the other
spouses consent or a court order allowing the sale, the same would be void.
Under the provisions of the NCC governing contracts, a void or
inexistent contract has no force and effect from the very beginning. And this
rule applies to contracts that are declared void by positive provision of the
law, as in the case of a sale of conjugal property without the other spouses
written consent. A void contract is equivalent to nothing and is absolutely
wanting in civil effects. It cannot be validated either by ratification or
prescription.
Ultimately, the Rocas ground for annulment is not forgery but
the lack of written consent of their mother to the sale. The forgery is merely
evidence of lack of consent.
The Fuentes spouses point out that it was to Rosario, whose
consent was not obtained, that the law gave the right to bring an action to
declare void her husbands sale of conjugal land. But Rosario died in 1990,
the year after the sale. Does this mean that the right to have the sale declared
void is lost forever?
No. The sale was void from the beginning. Consequently, the
land remained the property of Tarciano and Rosario despite the sale. When
the 2 died, they passed on the ownership of the property to their heirs,
namely, the Rocas. As lawful owners, the Rocas had the right, under Article
429 of the NCC, to exclude any person from its enjoyment and disposal.

REIMBURSEMENT RE: CONJUGAL FUNDS:

JOSEFA FERRER vs. SPS. MANUEL & VIRGINIA FERRER and
SPS. ISMAEL & FLORA FERRER
508 SCRA 570 (November 29, 2006)
Before his marriage to Josefa, Alfredo acquired a parcel of land.
Improvements introduced by Alfredo on the property consisting of a

residential house and a 2-door apartment building were made during the
marriage using their conjugal funds to pay off the loan obtained by Alfredo
for the construction of said improvements. Subsequently, a warehouse was
also constructed on the lot using the spouses conjugal funds. Sometime in
1989, when Alfredo was already bedridden, spouses Ismael and Flora Ferrer
made the former sign a document purported to be his last will and testament.
It turned out however, that it was a sale covering Alfredos lot and the
improvements thereon to the herein respondents. Alfredo then instituted an
action for the annulment of the sale but the trial court held that the sale is
valid and should be complied with by the parties in good faith. The appellate
court upheld the decision of the lower court. Alfredo died in 1999 and
relying on the decision rendered in the previous case where the court held
that inasmuch as the lot is of greater value than the improvements and since
Article 120 of the Family Code provides the rule that the ownership of
accessory follows the ownership of the principal, then the subject lot with all
its improvements became an exclusive and capital property of Alfredo with
an obligation to reimburse the conjugal partnership of the cost of
improvements at the time of the liquidation of the conjugal partnership,
Josefa is now demanding reimbursement for the cost of the improvements
from respondents.
SC: What is incontrovertible is that the respondents, despite
allegations contained in the complaint that they are the buyers of the subject
premises, are not petitioners spouse nor can they ever be deemed as the
owner-spouse upon whom the obligation to reimburse petitioner for her
costs rested. It is the owner-spouse who has the obligation to reimburse the
conjugal partnership or the spouse who expended the acts or efforts, as the
case may be. Otherwise stated, respondents do not have the obligation to
respect petitioners right to be reimbursed.
JUDICIAL SEPARATION OF PROPERTY
Article 134- In the absence of express declaration in the
marriage settlements, no separation of property shall take place during the
marriage except upon judicial order. The separation of property may either
be for sufficient cause (Article 135) or voluntary (Article 136).
Article 135 For causes falling under numbers (1), (2), and (3)
i.e.1. sentenced to a penalty that carries with it civil interdiction, 2. judicially
declared an absentee, and 3. loss parental authority decreed by the court, the
presentation of final judgment is enough basis for the grant of the decree of
judicial separation of property.
Article 136 Voluntary dissolution must be verified and jointly
filed by the spouses.
Articles 137, 138, and 139 liquidation of either the absolute
community or conjugal partnership upon grant of petition, effect the
property relations of the spouses is now governed by the regime of complete
separation of property and the requirement of registering the petition for
separation of property and the final judgment granting the same with the
appropriate registries.
Article 141- revival of the former property regime that existed
prior to its separation upon proper motion. Thereafter no voluntary
separation of property shall again be granted by the court.
ELENA MULLER vs. HELMUT MULLER
August 29, 2006
Elena and Helmut, a German national, were married in 1989 in
Hamburg, Germany. They initially lived in Hamburg but in 1992, the
spouses decided to move and permanently reside in the Philippines. Helmut
sold the house he inherited from his parents in Germany. With the money, he
bought a P528,000.00 lot in Antipolo and constructed a P2.3 million peso
house thereon. The Antipolo property was registered in Elenas name. The
marriage however, did not last due to Helmuts alleged womanizing,
drinking and maltreatment and eventually the spouses separated. In 1994,
Helmut filed a petition for separation of properties. He claims that he is not
praying for the transfer of ownership of the Antipolo property as he is aware
of the constitutional prohibition of aliens acquiring lands of the public
domain but merely reimbursement. That the property is titled in the name of
Elena because of said prohibition. That the funds paid by him for the said
property were in consideration of his marriage to Elena; that funds were
given to her in trust and equity demands that he should be reimbursed of his
personal funds.
Issue: Is respondent entitled to reimbursement of the funds used
for the acquisition of the Antipolo property?
SC: Aliens are disqualified from acquiring private lands. The
primary purpose of the constitutional provision is the conservation of the
national patrimony.
Respondent cannot seek reimbursement on the ground of equity
where it is clear that he willingly and knowingly bought the property despite
the constitutional prohibition. It has been held that equity as a rule will
follow the law and will not permit that to be done indirectly which, because
of public policy, cannot be done directly. He who seeks equity must do
equity, and he who comes into equity must come with clean hands.
Further, the distinctions between transfer of ownership as
opposed to recovery of funds is a futile exercise on respondents part. To
allow reimbursement would in effect permit respondent to enjoy the fruits of
a property that he is not allowed to own. Thus, it is, likewise proscribed by
law.

The CA erred in holding that an implied trust was created and

resulted by operation of law in view of Helmuts marriage to Elena. Save for
the exception provided in cases of hereditary succession, Helmuts
disqualification from owning lands in the Philippines is absolute. Not even
an ownership in trust is allowed. Besides, where the purchase is made in
violation of an existing statute and in evasion of its express provision, no
trust can result in favor of the party who is guilty of fraud. To hold otherwise
would be to allow circumvention of the constitutional prohibition.
The Court decreed the separation of property between the
spouses and ordering partition of the personal properties located in the
Philippines only.
VIRGILIO MAQUILAN vs. DITA MAQUILAN
524 SCRA 166 (June 8, 2007)
Virgilio and Ditas marriage that was blessed with one son
turned sour when the former discovered that the latter was having illicit
sexual affair with her paramour, which resulted to the conviction of Dita and
her paramour of the crime of adultery. Thereafter, Virgilio filed a petition for
declaration of nullity of marriage, dissolution and liquidation of the conjugal
partnership of gains. During the pre-trial of said case, they entered into a
Compromise Agreement as partial settlement of their conjugal partnership
property. This was given judicial imprimatur by the judge hearing the case.
In an omnibus motion however, Virgilio prays for the repudiation of the
compromise agreement on the ground that it is against law and public
policy; that the proceedings where it was approved is null and void, there
being no appearance and participation of the Solicitor General or the
Provincial Prosecutor; that it was timely repudiated; and that respondent,
having been convicted of adultery, is therefore disqualified from sharing in
the conjugal property.
SC: Article 143 of the Family Code, separation of property
may be effected voluntarily or for sufficient cause, subject to judicial
approval. The questioned compromise agreement that was judicially
approved is exactly such a separation of property allowed under the law.
This conclusion holds true even if the proceedings for the declaration of
nullity of marriage was still pending.
While the appearances of the Solicitor General and/or Public
Prosecutor are mandatory, the failure of the RTC to require their appearance
does not per se nullify the compromise agreement. There is no exigency for
the presence of the Solicitor General and/or the State Prosecutor because
nothing in the subject compromise touched into the very merit of the case of
declaration of nullity of marriage for the court to be wary of any possible
collusion between the parties. The agreement pertains merely to an
agreement between petitioner and respondent Dita to separate their conjugal
properties partially without prejudice to the outcome of the pending case.
The conviction of adultery does not carry with it the penalty of
civil interdiction that deprives the person of the rights to manage to manage
her property and to dispose of such property inter vivos.
Art. 147 Property of Unions without Marriage (92,97)
Valdes vs. RTC B. 102, Q.C., Gomez-Valdes
July 31, 1996
-Marriage was declared void under Art. 36.
-Property acquired during the union is governed by Art. 147. It
applies when a man and a woman so exclusively live together
as husband and wife under a void marriage or without the
benefit of marriage.
-The term capacitated (1st par. of Art. 147) refers
to the legal capacity of a party to contract
marriage, i.e. any male or female of the age of 18
years or upwards not under any of the impediment
mentioned in Art. 37 and 38 of the Code.
-If the common-law spouses suffer from a legal
impediment to marry or when they do not live
exclusively with each other (as husband and wife),
only the property acquired by both of them
through their actual joint contribution of money,
property or industry shall be owned in common
and in proportion to their respective contributions.
-Art. 50 (Family Code) applying pars. (2), (3), (4)
and 5 of Art. 43, relates only, by its explicit terms
to voidable marriages and, exceptionally, to void
marriages under Art. 40 of the Code i.e. the
declaration of nullity of a subsequent marriage
contracted by a spouse of a prior void marriage
before the latter is judicially declared void.
BUENAVENTURA vs. CA
March 31, 2005

Noel and Isabel got married in 1979. The marriage

later on was declared void by reason of Noels psychological
incapacity. The court, among others, ordered for the
liquidation of the assets of the conjugal partnership where
the wife was given of Noels retirement benefits with 12%
int. from date of decision, and of his outstanding shares of
stocks with Manila Memorial Park and the Provident Group of
Companies. Noel opposed the sharing claiming that the
retirement benefits he received from Far East Bank are
gratuitous in nature and therefore, his exclusive property. He
likewise acquired the shares of stocks with the mentioned
companies before his marriage and are, again his exclusive
properties.
SC: Since the present case does not involve the
annulment of a bigamous marriage, the provisions of Article
50 in relation to Articles 41, 42, and 43 of the Family Code,
providing dissolution of the absolute community or conjugal
partnership, as the case may be, do not apply. Rather, the
general rules applies, which is that in case a marriage is
declared void ab initio, the property regime applicable and to
be liquidated, partitioned and distributed is that of coownership. The trial court did not commit a reversible ruling
that petitioner and respondent own the family home and
all their common property in equal shares, as well as in
concluding that, in the liquidation and partition of the
property owned in common by them, the provisions on coownership under the Civil Code, not Articles 50, 51 and 52, in
relation to Articles 102 and 129, of the Family Code, should
aptly prevail. The rules set up to govern the liquidation of
either the absolute community or the conjugal partnership of
gains, the property regimes recognized for valid and
voidable marriages (in the latter case until the contract is
annulled), are irrelevant to the liquidation of the coownership that exists between common law spouses.
Unlike the conjugal partnership of gains, the fruits
of the couples separate property are not included in the coownership. Since the properties to be distributed by the
court a quo were found, both by the trial and appellate
courts, to have been acquired during the union of the
parties, the same would be covered by the co-ownership. No
fruits of a separate property of one of the parties appear to
have been included or involved in the distribution. The
liquidation, partition and distribution of the properties owned
by the parties herein ordered by the court a quo should,
therefore, be sustained, but on the basis of co-ownership
and not the regime of conjugal partnership of gains.
JOHN ABING vs. JULIET WAEYAN
July 31, 2006
In 1986, Juliet and John decided to live together as
husband and wife without the benefit of marriage. During the
cohabitation, they purchased a 2-storey house where the tax
declaration was transferred in the name of Juliet. The house
was renovated as annexed to it is a new structure that
housed a sari-sari store. In 1991, Juliet went to Korea and
while there she would send money to John who would
deposit it in their joint bank account. When she returned
from Korea, they continued to live together, with John
working as an employee of Lepanto Mines and Juliet
managing the store.
In 1995, they partitioned their
properties and executed a Memorandum of Agreement that
was unsigned by the parties but signed by their witnesses
where it was agreed that John shall leave the house with
Juliet paying him the amount of P428,870.00 representing
Johns share in the properties. Juliet made a down payment
of P232,397.66 with the balance to be paid in 12 monthly
installments. She failed however, to make good the balance
so John demanded that she vacate the annex. When she
refused John filed an ejectment suit against Juliet claiming
that he alone spent for the construction of the annex using

his own funds with the tax declaration for the structure
under his name and thru money he borrowed from his
relatives as proofs. The proof of indebtedness is a 1990
affidavit of one Macaraeg who stated that John borrowed
P30,000.00 from him. The MTC found for John which decision
was affirmed by the RTC. The CA however, reversed the
ruling of lower courts holding that their property relations
cannot be governed by the provisions of the Civil Code but
by the rules on co-ownership. John went to the SC.
Issue: Whether or not the property subject of the
suit pertains to the exclusive ownership of John.
SC: Other than Johns bare allegation that he
alone, thru his own funds and money he borrowed form his
relatives, spent for the construction of the annex, evidence is
wanting to support such naked claim. For sure, John failed to
reveal how much he spent therefore. Neither did he divulge
the names of the alleged relatives from whom he made his
borrowings, let alone the amount of money he borrowed
from them. All he could offer by way of reinforcing his claim
is the affidavit of Macaraeg but the affidavit stated that it
was in 1990 when John borrowed P30,000.00 from him. The
annex structure was constructed in 1992 or 2 years after he
borrowed the P30,000 from Macaraeg. There is a paucity of
evidence, testimonial or documentary, to support Johns selfserving allegation that the annex structure was put up thru
his own funds and/or money borrowed by him. Tax
declarations do not prove ownership but at best an indicia of
claims of ownership.
In this connection Article 147 of the Family Code is
instructive. (Cite Article 147 in toto).
The law is clear. In the absence, as here, of proofs
to the contrary, any property acquired by common-law
spouses during the period of cohabitation is presumed to
have been obtained thru their joint efforts, work or industry
and is owned by them in equal shares. Their property
relationship is governed by the rules in co-ownership. And
under this regime, they owned their properties in common
in equal shares. Being herself a co-owner of the structure
in question, Juliet, as correctly stated by the CA, may not be
ejected therefrom.
True, under Article 487 of the Civil Code, a coowner may bring an action for ejectment against a co-owner
who takes exclusive possession and asserts exclusive
ownership of a common property. In this case, evidence is
totally wanting to establish Johns or Juliets exclusive
ownership of the property in question. As borne by the
record, Juliet was in possession of the subject structure by
virtue of being a co-owner thereof. As such, she is as much
entitled to enjoy its possession and ownership as John.
Juliets failure however, to pay the balance of
Johns share in their common properties could at best give
rise to an action for a sum of money against Juliet, or for
rescission of the said agreement and not for ejectment.
METROBANK v. PASCUAL 547 S 246 02/29/2009
The marriage was declared void under Article 36.
In said decision, the court ordered the partition/dissolution of
the conjugal partnership. No liquidation was, however, made.
Subsequently, ex-wife Florencia mortgaged the property to
Metro Bank to secure a loan. Attached to the loan documents
were the decision of the court nullifying the marriage to
Nicholson and a waiver purportedly signed by Nicholson
where he waived his share in the conjugal property. Florencia
failed to pay the loan so Metro Bank foreclosed the
mortgage. When Nicholson learned of the foreclosure
proceedings, he instituted a complaint for declaration of
nullity of the mortgage as it was made without his consent.

SC: While the declared nullity of marriage of

Nicholson and Florencia severed their marriage bond and
dissolved the conjugal partnership, the character of the
property acquired before such declaration continue to
subsist as conjugal properties until after the liquidation and
partition. Pending its liquidation and citing DAEL v. IAC, 171
S 524, the conjugal property is converted into an implied
ordinary co-ownership among the surviving spouse and the
other heirs of the deceased.
Hence, Article 493 of the Civil Code shall apply.
Florencia has the right to mortgage her undivided
share/interest in the property but not the share of Nicholson.
ALAIN DINO v. MA. CARIDAD L. DINO G.R. No. 178044
01/19/2011
The marriage was declared void by reason of the
wifes psychological incapacity. The trial court also held that
A DECREE OF ABSOLUTE NULLITY OF MARRIAGE shall only
be issued after liquidation, partition and distribution of the
parties properties under article 147 of the Family Code.
This is pursuant to Section 19 (1) of the Rule on Declaration
of Nullity of Marriage.
SC: The ruling has no basis because Section 19 (1)
of the Rule does not apply to cases governed under Articles
147 and 148 of the Family Code.
It is clear from Article 50 of the FC that section 19
(1) of the Rule applies only to marriages which are declared
void ab initio or annulled by final judgment under Articles 40
and 45 of the FC. In short, Article 50 does not apply to
marriages which are declared void ab initio under Article 36
of the Family Code, which should be declared without waiting
for the liquidation of the properties of the parties.
Article 40 of the FC contemplates a situation
where a second marriage or bigamous marriage was
contracted.
Article 45, on the other hand, refers to voidable
marriages. In both instances under Articles 40 and 45, the
marriages ae governed either by absolute community or
conjugal partnership of gains unless the parties agree to a
complete separation of property. If the property relations is
governed by absolute community of property or conjugal
partnership of gains, there is a need to liquidate, partition
and distribute the properties before a decree of annulment
could be issued. This is not the case for annulment of
marriage under Article 36 of the FC because the marriage is
governed by the ordinary rules on co-ownership.

-The lawyer who prepared the deed of conveyance of the house

and lot testified that the money for the purchase price was
provided for by Miguel and he also directed that Erlindas name
alone be placed as the vendee.
-SC also cited Article 87 of the Family Code.
Tumlos vs. Fernandez
330 SCRA 718
-Applicable law is Art. 148 of the Family Code.
-Art. 144 of the Civil Code applies only to a relationship
between a man and a woman who are not incapacitated to
marry each other, or to one in which the marriage of the parties
is void from the beginning. It does not apply to a cohabitation
that amounts to adultery or concubinage.
-Article 148 of the Family Code has filled the hiatus in Art. 144
of the Civil Code by expressly regulating the property relations
of couples living in a state of adultery or concubinage.
-Nothing in Art. 148 of the Family Code provides
that the administration of the property amounts to
a contribution in its acquisition.
Mallilin, Jr. vs. Castillo
333 SCRA 628
Both parties were already married when they cohabited
together. During the relationship they established a business enterprise and
by reason thereof acquired several properties. The properties however, were
all registered in the name of Castillo. When they decided to end the
relationship, Mallilin demanded for his share in the properties they acquired
during the cohabitation. Castillo countered that Article 144 of the Civil Code
cannot be applied as the same covers only properties acquired by a man and
a woman living together as husband and wife but not married or under a
void marriage. In their case, their union suffered the legal impediment of a
prior subsisting marriage.
SC: Art. 148 of the Family Code now provides for a
limited co-ownership in cases where the parties in union are
incapacitated to marry each other.
- It applies as all but one property were acquired
after the Family Code took effect on August 3, 1988. With
respect to the property acquired under the regime of the
New Civil Code, then it should be excluded. The legal relation
of the parties is already specifically covered by Article 148 of
the Family Code under which all properties acquired out of
their actual joint contribution of money, property or industry
shall constitute a co-ownership.
-Co-ownership is a form of trust and every co-owner is a trustee
for the other.
-A trust relation already inheres in a co-ownership.
Carino vs. Carino

The rules on co-ownership apply and the

properties of the spouses should be liquidated in accordance
with the Civil Code provisions on co-ownership. Under article
496 of the NCC, partition may be made by agreement
between the parties or by judicial proceedings. It is not
necessary to liquidate the properties of the spouses in the
same proceeding for declaration of nullity of marriage.

February 2, 2001
-

Art. 148- other kinds of cohabitation (91,92,98,00)

Agapay vs. Palang
July 28, 1997
-Petitioner failed to prove that she contributed
money to the price of the riceland.

The nullity of the marriage between

Nicdao (the first wife) and the
deceased does not validate the
second marriage of Yee and the
deceased Santiago without the prior
judicial declaration of nullity of the
previous marriage.
Considering
that
the
marriage
between Yee and the deceased is a
bigamous marriage, having been
solemnized during the subsistence of
previous marriage then presumed to
be valid, the application of Article 148
is therefore in order.
As to the property regime of Nicdao
and the deceased, Article 147 of the
Family Code governs. This Article
applies to unions of parties who are
legally capacitated and not barred by
any impediment to contract marriage,

but whose marriage is nonetheless is

void for other reasons, like the
absence
of
marriage
license.
Conformably, even if the deceased
alone as a government employee
earned the disputed death benefits,
Article 147 creates a co-ownership in
respect thereto entitling Nicdao to
share one-half thereof as there is no
allegation of bad faith.
6. JACINTO SAGUID vs. CA
June 10, 2003
-Under the property regime governed by Art. 148
x x x x only the properties acquired by both of the
parties through their actual joint contribution of
money, property, or industry shall be owned by
them in common in proportion to their respective
contributions x x x x. Proof of actual contribution
is required.
- In the case at bar, nowhere in Ginas testimony
did
she
specify
the
extent
of
her
contribution. What appears in the record are
receipts in her name for the purchase of
construction materials on 11/17/95 and 12/23/95
in the amount of P11,413.00. With respect to the
disputed personal properties both claimed that the
money used in the purchase thereof came partly
from their joint account. There is however, no
sufficient proof of the exact amount of their
respective shares in the said account. And
pursuant to Article 148 of the Family Code, in the
absence of proof of extent of the parties
respective contribution, their share shall be
presumed to be equal. Here, the disputed
properties were valued at P111,375.00, the
existence and value of which were not questioned
by Jacinto, hence, their share therein is equivalent
to , P55,687.50 each. And on the basis of the
evidence established, the extent of Ginas coownership over the disputed house is only up to
the amount of P11,413.00 her proven contribution
in the construction thereof.
-In Adriano vs. CA, the SC ruled that the fact that
the controverted property was titled in the name
of the parties to an adulterous relationship is not
sufficient proof of co-ownership absent evidence of
actual contribution in the acquisition of the
property.
RIVERA
vs.
VILLANUEVA

HEIRS

OF

ROMUALDO

496 SCRA 135 (July 21, 2006)

- Because the cohabitation of Villanueva and
Gonzales from 1927 to 1963 was adulterous, their
property relations during those 36 years were not
governed by Article 144 of the Civil Code which
applies only if the couple living together is not in
any way incapacitated
from getting married.
According to the doctrine laid down in Juaniza vs.
Jose (89 SCRA 306), no co-ownership exists
between parties to an adulterous relationship. In
Agapay vs. Palang, we expounded on this doctrine
by declaring that in such a relationship, it is
necessary for each of the partners to prove his or
her actual contribution to the acquisition of
property in order to be able to lay claim to any
portion of it. The presumption of co-ownership and
equal contribution do not apply.

LUPO ATIENZA vs. YOLANDA DE CASTRO

508 SCRA 593 (November 29, 2006)
Lupo, married and the president and general
manager of 2 corporations, hired the services of Yolanda as
accountant thereof. The 2 became intimate and eventually
lived together and had 2 children. The relationship turned
sour and they parted ways. Lupo then filed a petition for
judicial partition involving a parcel of land with
improvements located in Bel-Air Subdivision, Makati City. He
alleged that the property was acquired during their union
and hence, the property is co-owned by them. He claimed
that the funds used in the acquisition of the said property
were his exclusive funds and that the title was transferred to
Yolandas name alone was done without his knowledge and
consent. And since the property was acquired in 1987,
therefore Article 144 of the Civil Code should be applied.
That he is not burdened to prove that he contributed to the
acquisition thereof because with or without contribution by
either partner, he is deemed a co-owner of the subject
property. He added that Article 484 of the Civil Code states
that as long as the property was acquired by either or both
of them during their extramarital union, such property would
be legally owned by them in common and governed by the
rules on co-ownership, which shall apply in default of
contracts or special provisions.
SC: Here although the adulterous relationship
commenced in 1983, Article 148 of the Family Code applies
because this provision is intended to fill up the hiatus/gap in
Article 144 of the Civil Code. Before Article 148 of the FC was
enacted, there was no provision governing property property
relations of couples living in a state of adultery or
concubinage. Hence, even if the cohabitation or the
acquisition of the property occurred before the FC took
effect, Article 148 of the FC governs.
Rather than presenting proof of his actual
contribution to the purchase used as consideration for the
property, Lupo diverted the burden upon him to Yolanda as a
shrewd and scheming woman without capacity to purchase
any property. Petitioners claim of ownership is without basis
because not only did he fail to substantiate his allege
contribution but likewise the very trail of documents
pertaining to its purchase as evidentiary proof redounds to
the benefit of respondent. In contrast, aside from his mere
say so and voluminous bank records, which sadly finds no
relevance in this case, the petitioner failed to overcome his
burden of proof.
Respondent had sufficiently established that she
derived funds used to purchase the property from her
earnings, not only as an accountant but also as a
businesswoman engaged in foreign currency trading, money
lending and jewelry retail. She presented clientele and
promissory notes evincing substantial dealings with her
clients, her bank account statements and bank transactions.
BORROMEO vs. DESCALLAR 580 SCRA 175 (February 24,
2009)
Austrian Jambrich met and fell in love with
Descallar, a married but separated woman, who was working
as waitress at a local hotel in Cebu City. She was earning
P1,000.00 per month and another P1,000.00 in the form of
tips. Subsequently, they bought 3 parcels of land with a
house constructed thereon. The deed of sale originally
included Jambrich as buyer but because of the refusal of the
Register of Deeds to register the property in Jambrichs name
on the ground that a foreigner could not acquire alienable
lands of public domain they erased his name but not his
signatures appearing in all pages of the document. Jambrich
and Descallar however, separated.

Subsequently, Jambrich incurred debts and to pay

the obligation, he sold his rights and interest in the property
that is now registered in Descallars name in favor of his
creditor. Is the sale made by Jambrich valid?
SC: The transfer of land from Agro-Macro
Development Corporation to Jambrich could have been
declared invalid if challenged, had not Jambrich conveyed

the property to Borromeo. Citing United Church of Christ vs.

Sebastian, the Court reiterated the consistent ruling that if
land is invalidly transferred to an alien who subsequently
becomes a Filipino citizen or transfers it to a Filipino, the flaw
in the original transaction is considered cured and the title of
the transferee is considered valid.