property relations cases

1

G.R. No. 55322. February 16, 1989.*

MOISES JOCSON, petitioner, vs. HON. COURT OF

APPEALS, AGUSTINA JOCSON-VASQUEZ, ERNESTO

VASQUEZ, respondents.

Civil Law; Obligations and Contracts; Voidable

Contracts;Sales; Contract of Sale;Consideration; The slight

difference between the market value and the purchase price of the

properties in question may be disregarded considering that the

contracts of sale were executed between the father and the daughter,

in which case, filial love must be taken into consideration.—

Secondly, neither may the contract be declared void because of

alleged inadequacy of price. To begin with, there was no showing

that the prices were grossly inadequate. In fact, the total purchase

price paid by Agustina Jocson-Vasquez is above the total assessed

value of the properties alleged by petitioner. In his Second

Amended Complaint, petitioner alleged that the total assessed

value of the properties mentioned in Exhibit 3 was P8.920; Exhibit

4, P3,500; and Exhibit 2, P24,840, while the purchase price paid

was P10,000, P5,000, and P8,000, respectively, the latter for the

1/3 share of Emilio Jocson from the paraphernal properties of his

wife, Alejandra Poblete. And any difference between the market

value and the purchase price, which as admitted by Emilio Jocson

was only slight, may not be so shocking considering that the sales

were effected by a father to her daughter in which case filial love

must be taken into consideration (Alsua-Betts vs. Court of

Appeals, No. L-46430-31, April 30, 1979, 92 SCRA 332).

Same; Property; Persons and Family Relations; Conjugal

Partnership; Proof of acquisition during the coverture is a condition

sine qua non for the application of the presumption in favor of

conjugal partnership.—There is another ground relied upon by

petitioner in assailing Exhibits 3 and 4, that the properties subject

matter therein are conjugal properties of Emilio Jocson and

Alejandra Poblete. It is the position of petitioner that since the

properties sold to Agustina Jocson-Vasquez under Exhibit 3 were

registered in the name of “Emilio Jocson, married to Alejandra

Poblete,” the certificates of title he presented as evidence (Exhibits

“E” to “J”, pp. 4-9, Records) were enough proof to show that the

properties covered therein were acquired during the marriage of

their parents, and, therefore, under Article 160 of the Civil Code,

presumed to be conjugal properties. Article 160 of the Civil Code

provides that: “All property of the marriage is presumed to belong

to the conjugal partnership, unless it be proved that it pertains

exclusively to the husband or to the wife.” In Cobb-Perez vs. Hon.

Gregorio Lantin, No. L-22320, May 22, 1968, 23 SCRA 637, 644,

We held that: “Anent their claim that the shares in question are

conjugal assets, the spouses Perez adduced not a modicum of

evidence, although they repeatedly invoked article 160 of the New

Civil Code which provides that x x x. As interpreted by this Court,

the party who invokes this presumption must first prove that the

property in controversy was acquired during the marriage. In

other words, proof of acquisition during the coverture is a

condition sine qua non for the operation of the presumption in

favor of conjugal ownership. Thus in Camia de Reyes vs. Reyes de

Ilano [62 Phil. 629, 639], it was held that ‘according to law and

jurisprudence, it is sufficient to prove that the property was

acquired during the marriage in order that the same may be

deemed conjugal property,’ In the recent case of Maramba vs.

Lozano, et. al, [L-21533, June 29, 1967, 20 SCRA 474], this Court,

thru Mr. Justice Makalintal, reiterated that ‘the presumption

under Article 160 of the Civil Code refers to property acquired

during the marriage,’ and then concluded that since there is no

showing as to when the property in question was acquired x x x the

fact that the title is in the wife’s name alone is determinative.’

Similarly, in the case at bar, since there is no evidence as to when

the shares of stock were acquired, the fact that they are registered

in the name of the husband alone is an indication that the shares

belong exclusively to said spouse.”

Same; Same; Same; Same;Same; The fact that the subject

properties were registered in the name of “Emilio Jocson married to

Alejandro Poblete” is no proof that said properties were acquired

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during the spouses’ marriage.—It is thus clear that before Moises

Jocson may validly invoke the presumption under Article 160 he

must first present proof that the disputed properties were acquired

during the marriage of Emilio Jocson and Alexandra Poblete. The

certificates of title, however, upon which petitioner rests his claim

is insufficient. The fact that the properties were registered in the

name of “Emilio Jocson, married to Alejandra Poblete” is no proof

that the properties were acquire during the spouses coverture.

Acquisition of title and registration thereof are two different acts.

It is well settled that registration does not confer title but merely

confirms one already existing (See Torela vs. Torela, supra). It may

be that the properties under dispute were acquired by Emilio

Jocson when he was still a bachelor but were registered only after

his marriage to Alejandra Poblete, which explains why he was

described in the certificates of title as married to the latter.

Same; Same; Same; Same;Same; Same; The words “married

to” preceding the name Alejandra Poblete are merely descriptive of

Emilio Jocsons’s civil status.—Contrary to petitioner’s position, the

certificates of title show, on their face, that the properties were

exclusively Emilio Jocson’s, the registered owner. This is so

because the words “married to” preceding “Alejandra Poblete” are

merely descriptive of the Civil status of Emilio Jocson (Litam v.

Rivera, 100 Phil. 354; Stuart v. Yatco, No. L-16467, April 27, 1962,

4 SCRA 1143; Magallon V. Montejo, G.R. No. 73733, December 16,

1986, 146 SCRA 282). In other words, the import from the

certificates of title is that Emilio Jocson is the owner of the

properties, the same having been registered in his name alone, and

that he is married to Alejandra Poblete.

PETITION for certiorari to review the decision of the Court

of Appeals.

336 336 SUPREME COURT

REPORTS

ANNOTATED

Jocson vs. Court of Appeals

The facts are stated in the opinion of the Court.

Dolorfino and Dominguez Law Offices for petitioner.

Gabriel G. Mascardo for private respondents.

MEDIALDEA, J.:

This is a petition for review on certiorari under Rule 45 of the

Rules of Court of the decision of the Court of Appeals in CA-

G.R. No. 63474, promulgated on April 30, 1980, entitled

“MOISES JOCSON, plaintiff-appellee, versus AGUSTINA

JOCSON-VASQUEZ and ERNESTO VASQUEZ, defendant-

appellants,” upholding the validity of three (3) documents

questioned by Moises Jocson, in total reversal of the decision

of the then Court of First Instance of Cavite, Branch I, which

declared them as null and void; and of its resolution, dated

September 30, 1980, denying therein appellee’s motion for

reconsideration.

Petitioner Moises Jocson and respondent Agustina Jocson-

Vasquez are the only surviving offsprings of the spouses

Emilio Jocson and Alejandra Poblete, while respondent

Ernesto Vasquez is the husband of Agustina. Alejandra

Poblete predeceased her husband without her intestate

estate being settled. Subsequently, Emilio Jocson also died

intestate on April 1, 1972.

As adverted to above, the present controversy concerns the

validity of three (3) documents executed by Emilio Jocson

during his lifetime. These documents purportedly conveyed,

by sale, to Agustina Jocson-Vasquez what apparently covers

almost all of his properties, including his one-third (1/3)

share in the estate of his wife. Petitioner Moises Jocson

assails these documents and prays that they be declared null

and void and the properties subject matter therein be

3

partitioned between him and Agustina as the only heirs of

their deceased parents.

The documents, which were presented as evidence not by

Moises Jocson, as the party assailing its validity, but rather

by herein respondents, are the following:

1) “Kasulatan ng Bilihan ng Lupa,” marked as Exhibit 3

(pp. 12-13, Records) for the defendant in the court

a quo,dated July 27, 1968. By this document Emilio Jocson

sold to Agustina Jocson-Vasquez six (6) parcels of land, all

located at Naic,

337 VOL. 170, FEBRUARY

16, 1989

337


Cavite, for the sum often thousand (P10,000.00) pesos. On

the same document Emilio Jocson acknowledged receipt of

the purchase price, thus:

“Na ngayon, akmg-alang sa halagang SAMPUNG LIBONG PISO

(P10,000) salaping Pilipino na aking tinanggap ng buong

kasiyahan loob at ang pagkakatanggap ay aking hayagang

inaamin sa pamamagitan ng kasulatang ito, sa aking anak na si

Agustina Jocson, na may sapat na gulang, mamamayang Pilipino,

asawa ni Ernesto Vasquez, at naninirahan sa Poblacion, Naic,

Cavite, ay aking ipinagbile ng lubusan at kagyat at walang ano

mang pasubali ang nabanggit na anim na pirasong lupa na nasa

unang dahon ng dokumentong ito, sa nabanggit na Agustina

Jocson, at sa kaniyang taga-pagmana o makakahalili at gayon

din nais kong banggitin na kahit na may kamurahan ang ginawa

kong pagbibile ay dahilan sa ang nakabile ay aking anak na

mahal sa akin at mapaglingkod, madamayin at ma-alalahanin, na

tulad din ng isa ko pang anak na lalaki. Ang kuartang tinanggap

ko na P10,000.00, ay gagamitin ko sa aking katandaan at mga

huling araw at sa aking mga ibang mahahalagang

pangangailangan. [Italics supplied]

“Na nais ko ring banggitin na ang ginawa kong ito ay hindi

labag sa ano mang batas o kautusan, sapagkat ang aking pinagbile

ay akin at nasa aking pangalan. Ang mga lupang nasa pangalan

ng aking nasirang asawa ay hindi ko ginagalaw ni pinakikialaman

at iyon ay dapat na hatiin ng dalawa kong anak alinsunod sa

umiiral na batas (p. 13, Records.)”

2) “Kasulatan ng Ganap na Bilihan” dated July 27, 1968,

marked as Exhibit 4 (p. 14, Records). On the face of this

document, Emilio Jocson purportedly sold to Agustina

Jocson-Vasquez, for the sum of FIVE THOUSAND

(P5,000.00) PESOS, two rice mills and a

camarin (camalig)located at Naic, Cavite. As in the first

document, Moises Jocson acknowledged receipt of the

purchase price:

“Na alang-alang sa halagang LIMANG LIBONG PISO (P5,000.00)

salaping pilipino na aking tinanggap ng buong kasiyahan loob sa

aking anak na Agustina Jocson x x x. Na ang halagang ibinayad sa

akin ay may kamurahan ng kaunti ngunit dahil sa malaking

pagtingin ko sa kaniya x x x kaya at pinagbile ko sa kaniya ang

mga nabanggit na pagaari kahit na hindi malaking halaga x x x (p.

14,


REPORTS

ANNOTATED


Records).”

3) Lastly, the “Deed of Extrajudicial Partition and

Adjudication with Sale, “dated March 9, 1969, marked as

Exhibit 2 (p. 10-11, Records), whereby Emilio Jocson and

Agustina Jocson-Vasquez, without the participation and

intervention of Moises Jocson, extrajudicially partitioned the

unsettled estate of Alejandra Poblete, dividing the same into

three parts, one-third (1/3) each for the heirs of Alejandra

Poblete, namely: Emilio Jocson, Agustina Jocson-Vasquez

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and Moises Jocson. By the same instrument, Emilio sold his

one-third (1/3) share to Agustina for the sum of EIGHT

THOUSAND (P8,000.00) PESOS. As in the preceding

documents, Emilio Jocson acknowledged receipt of the

purchase price:

“Now for and in consideration of the sum of only eight thousand

(P8,000.00) pesos, which I, the herein Emilio Jocson had received

from my daughter Agustina Jocson, do herebvy sell, cede, convey

and transfer, unto the said Agustina Jocson, her heirs and assigns,

administrators and successors in interests, in the nature of

absolute and irrevocable sale, all my rights, interest, shares and

participation, which is equivalent to one third (1/3) share in the

properties herein mentioned and described, the one third being

adjudicated unto Agustina Jocson and the other third (1/3) portion

being the share of Moises Jocson, (p. 11, Records).”

These documents were executed before a notary public.

Exhibits 3 and 4 were registered with the Office of the

Register of Deeds of Cavite on July 29, 1968 and the transfer

certificates of title covering the properties therein in the

name of Emilio Jocson, married to Alejandra Poblete,” were

cancelled and new certificates of title were issued in the

name of Agustina Jocson-Vasquez. Exhibit 2 was not

registered with the Office of the Register of Deeds.

Herein petitioner filed his original complaint (Record on

Appeal, p. 27, Rollo) on June 20, 1973 with the then Court of

First Instance of Naic, Cavite (docketed as Civil Case No.

TM-531), and which was twice amended. In his Second

Amended Complaint (pp. 47-58, Record on Appeal), herein

petitioner assailed the above documents, as aforementioned,

for being null and


16, 1989

339


void.

It is necessary to partly quote the allegation of petitioner

in his complaint for the reason that the nature of his causes

of action is at issue, thus:

“8. [With regard the first document, that] the defendants, through

fraud, deceit, undue pressure and influence and other illegal

machinations, were able to induce, led, and procured their father x

x x to sign [the] contract of sale xxx, for the simulated price of

P10,000.00, which is a consideration that is shocking to the

conscience of ordinary man and despite the fact that said

defendants have no work or livelihood of their own x x x; that the

sale is null and void, also, because it is fictitious, simulated and

fabricated contract xxx (pp. 52-53, Record on Appeal). [Italics

supplied]

“x x x.

“12. [With regards the second and third document, that they]

are null and void because the consent of the father, Emilio Jocson,

was obtained with fraud, deceit, undue pressure,

misrepresentation and unlawful machinations and trickeries

committed by the defendant on him; and that the said contracts

are simulated, fabricated and fictitious, having been made

deliberately to exclude the plaintiff from participating and with

the dishonest and selfish motive on the part of the defendants to

defraud him of his legitimate share on said properties [subject

matter thereof); and that without any other business or

employment or any other source of income, defendants who were

just employed in the management and administration of the

business of their parents, would not have the sufficient and ample

means to purchase the said propertiesexcept by getting the

earnings of the business or by simulated consideration x x x (pp.

54-55, Record on Appeal).” [Italics supplied]

Petitioner explained that there could be no real sale between

a father and daughter who are living under the same roof,

especially so when the father has no need of money as the

properties supposedly sold were all income-producing.

Further, petitioner claimed that the properties mentioned in

5

Exhibits 3 and 4 are the unliquidated conjugal properties of

Emilio Jocson and Alejandra Poblete which the former,

therefore, cannot validly sell (pp. 53, 57, Record on Appeal).

As far as Exhibit 2 is concerned, petitioner questions not the

extrajudicial partition but only the sale by his father to

Agustina of


REPORTS

ANNOTATED


the former’s 1/3 share (p. 13, Rollo).

The trial court sustained the foregoing contentions of

petitioner (pp. 59-81, Record on Appeal). It declared that the

considerations mentioned in the documents were merely

simulated and fictitious because: 1) there was no showing

that Agustina Jocson-Vasquez paid for the properties; 2) the

prices were grossly inadequate which is tantamount to lack

of consideration at all; and 3) the improbability of the sale

between Emilio Jocson and Agustina Jocson-Vasquez, taking

into consideration the circumstances obtaining between the

parties; and that the real intention of the parties were

donations designed to exclude Moises Jocson from

participating in the estate of his parents. It further declared

the properties mentioned in Exhibits 3 and 4 as conjugal

properties of Emilio Jocson and Alejandra Poblete, because

they were registered in the name of “Emilio Jocson, married

to Alejandra Poblete” and ordered that the properties subject

matter of all the documents be registered in the name of

herein petitioners and private respondents.

On appeal, the Court of Appeals in CA-G.R. No. 63474-

R rendered a decision (pp. 29-42, Rollo) and reversed that of

the trial court’s and ruled that:

1. “1.That insofar as Exhibits 3 and 4 are concerned the

appellee’s complaint for annulment, which is indisputably

based on fraud, and undue influence, is now barred by

prescription, pursuant to the settled rule that an action for

annulment of a contract based on fraud must be filed

within four (4) years, from the discovery of the fraud, xxx

which in legal contemplation is deemed to be the date of

the registration of said document with the Register of

Deeds x x x and the records admittedly show that both

Exhibits 3 and 4, were all registered on July 29, 1968,

while on the other hand, the appellee’s complaint was filed

on June 20, 1973, clearly beyond the aforesaid four-year

prescriptive period provided by law;

2. “2.That the aforesaid contracts, Exhibits 2, 3, and 4, are

decisively not simulated or fictitious contracts, since

Emilio Jocson actually and really intended them to be

effective and binding against him, as to divest him of the

full dominion and ownership over the properties subject of

said assailed contracts, as in fact all his titles over the

same were all cancelled and new ones issued to appellant

Agustina


16, 1989

341


1. Jocson Vasquez x x x;

2. 3.That in regard to Exhibit 2, the same is valid and

subsisting, and the partition with sale therein made by

and between Emilio Jocson and Agustina Jocson Vasquez,

affecting the 2/3 portion of the subject properties described

therein have all been made in accordance with Article 996

of the New Civil Code on intestate succession, and the

6

appellee’s (herein petitioner) remaining 1/3 has not been

prejudiced (pp. 41-42, Rollo).”

In this petition for review, Moises Jocson raised the following

assignments of errors:

1. I.HAS THE RESPONDENT COURT OF APPEALS ERRED

IN CONCLUDING THAT THE SUIT POR THE

ANNULMENT OF CONTRACTS FILED BY

PETITIONERS WITH THE TRIAL COURT IS “BASED

ON FRAUD” AND NOT ON ITS INEXISTENCE AND

NULLITY BECAUSE OF ITS BEING SIMULATED OR

FICTITIOUS OR WHOSE CAUSE IS CONTRARY TO

LAW, MORALS AND GOOD CUSTOMS?

2. II.HAS THE RESPONDENT COURT OF APPEALS

ERRED IN CONCLUDING THAT THE COMPLAINT

FILED BY PETITIONER IN THE TRIAL COURT IS

BARRED BY PRESCRIPTION?

3. III.HAS THE RESPONDENT COURT OF APPEALS

ERRED IN NOT DECLARING AS INEXISTENT AND

NULL AND VOID THE CONTRACTS IN QUESTION

AND IN REVERSING THE DECISION OF THE TRIAL

COURT? (p. 2, Rollo)

I.

The first and second assignments of errors are related and

shall be jointly discussed.

According to the Court of Appeals, herein petitioner’s

causes of action were based on fraud. Under Article 1330 of

the Civil Code, a contract tainted by vitiated consent, as

when consent was obtained through fraud, is voidable; and

the action for annulment must be brought within four years

from the time of the discovery of the fraud (Article 1391, par.

4, Civil Code), otherwise the contract may no longer be

contested. Under present jurisprudence, discovery of fraud is

deemed to have taken place at the time the convenant was

registered with the Register of Deeds (Gerona vs. De

Guzman, No. L-19060, May


REPORTS

ANNOTATED


29, 1964, 11 SCRA 153). Since Exhibits 3 and 4 were

registered on July 29, 1968 but Moises Jocson filed his

complaint only on June 20, 1973, the Court of Appeals ruled

that insofar as these documents were concerned, petitioner’s

“annulment suit” had prescribed.

If fraud were the only ground relied upon by Moises

Jocson in assailing the questioned documents, We would

have sustained the above pronouncement. But it is not so. As

pointed out by petitioner, he further assailed the deeds of

conveyance on the ground that they were without

consideration since the amounts appearing thereon as paid

were in fact merely simulated.

According to Article 1352 of the Civil Code, contracts

without cause produce no effect whatsoever. A contract of

sale with a simulated price is void (Article 1471; also Article

1409 [3]), and an action for the declaration of its nullity does

not prescribe (Article 1410, Civil Code; See also, Castillo v.

Galvan, No. L-27841, October 20, 1978, 85 SCRA 526).

Moises Jocson’s action, therefore, being for the judicial

declaration of nullity of Exhibits 3 and 4 on the ground of

simulated price, is imprescriptible.

II.

For petitioner, however, the above discussion may be purely

academic. The burden of proof in showing that contracts lack

consideration rests on he who alleged it. The degree of proof

becomes more stringent where the documents themselves

show that the vendor acknowledged receipt of the price, and

7

more so where the documents were notarized, as in the case

at bar. Upon consideration of the records of this case, We are

of the opinion that petitioner has not sufficiently proven that

the questioned documents are without consideration.

Firstly, Moises Jocson’s claim that Agustina Jocson-

Vasquez had no other source of income other than what she

derives from helping in the management of the family

business (ricefields and ricemills), and which was insufficient

to pay for the purchase price, was contradicted by his own

witness, Isaac Bagnas, who testified that Agustina and her

husband were engaged in the buy and sell of palay and rice

(p. 10, t.s.n.,


16, 1989

343


January 14, 1975). Amazingly, petitioner himself and his

wife testified that they did not know whether or not Agustina

was involved in some other business (p. 40, t.s.n., July 30,

1974; p. 36, t.s.n., May 24, 1974).

On the other hand, Agustina testified that she was

engaged in the business of buying and selling palay and rice

even before her marriage to Ernesto Vasquez sometime in

1948 and continued doing so thereafter (p. 4, ts.n., March 15,

1976). Considering the foregoing and the presumption that a

contract is with a consideration (Article 1354, Civil Code), it

is clear that petitioner miserably failed to prove his

allegation.

Secondly, neither may the contract be declared void

because of alleged inadequacy of price. To begin with, there

was no showing that the prices were grossly inadequate. In

fact, the total purchase price paid by Agustina Jocson-

Vasquez is above the total assessed value of the properties

alleged by petitioner. In his Second Amended Complaint,

petitioner alleged that the total assessed value of the

properties mentioned in Exhibit 3 was P8,920; Exhibit 4,

P3,500; and Exhibit 2, P24,840, while the purchase price paid

was P10,000, P5,000, and P8,000, respectively, the latter for

the 1/3 share of Emilio Jocson from the paraphernal

properties of his wife, Alejandra Poblete. And any difference

between the market value and the purchase price, which as

admitted by Emilio Jocson was only slight, may not be so

shocking considering that the sales were effected by a father

to her daughter in which case filial love must be taken into

consideration (Alsua-Betts vs. Court of Appeals, No. L-46430-

31, April 30, 1979, 92 SCRA 332).

Further, gross inadequacy of price alone does not affect a

contract of sale, except that it may indicate a defect in the

consent, or that the parties really intended a donation or

some other act or contract (Article 1470, Civil Code) and

there is nothing in the records at all to indicate any defect in

Emilio Jocson’s consent.

Thirdly, any discussion as to the improbability of a sale

between a father and his daughter is purely speculative

which has no relevance to a contract where all the essential

requisites of consent, object and cause are clearly present.

There is another ground relied upon by petitioner in

assail-


REPORTS

ANNOTATED


ing Exhibits 3 and 4, that the properties subject matter

therein are conjugal properties of Emilio Jocson and

Alejandra Poblete. It is the position of petitioner that since

the properties sold to Agustina Jocson-Vasquez under

Exhibit 3 were registered in the name of “Emilio Jocson,

married to Alejandra Poblete,” the certificates of title he

presented as evidence (Exhibits “E”, to “J”, pp. 4-9, Records)

8

were enough proof to show that the properties covered

therein were acquired during the marriage of their parents,

and, therefore, under Article 160 of the Civil Code, presumed

to be conjugal properties.

Article 160 of the Civil Code provides that:

“All property of the marriage is presumed to belong to the conjugal

partnership, unless it be proved that it pertains exclusively to the

husband or to the wife.”

In Cobb-Perez vs. Hon. Gregorio Lantin, No. L-22320, May

22, 1968, 23 SCRA 637, 644, We held that:

“Anent their claim that the shares in question are conjugal assets,

the spouses Perez adduced not a modicum of evidence, although

they repeatedly invoked article 160 of the New Civil Code which

provides that x x x. As interpreted by this Court, the party who

invokes this presumption must first prove that the property in

controversy was acquired during the marriage. In other words,

proof of acquisition during the coverture is a condition sine qua

non for the operation of the presumption in favor of conjugal

ownership. Thus in Camia de Reyes vs. Reyes de Ilano [62 Phil.

629, 639], it was held that ‘according to law and jurisprudence, it is

sufficient to prove that the property was acquired during the

marriage in order that the same may be deemed conjugal

property.’ In the recent case of Maramba vs. Lozano, et. al. [L-

21533, June 29, 1967, 20 SCRA 474], this Court, thru Mr. Justice

Makalintal, reiterated that the presumption under Article 160 of

the Civil Code refers to property acquired during the marriage,’

and then concluded that since ‘there is no showing as to when the

property in question was acquired x x x the fact that the title is in

the wife’s name alone is determinative.’ Similarly, in the case at

bar, since there is no evidence as to when the shares of stock were

acquired, the fact that they are registered in the name of the

husband alone is an indication that the shares belong exclusively

to said spouse.”

345 VOL. 170, FEBRUARY 345

16, 1989


This pronouncement was reiterated in the case of Ponce de

Leon vs. Rehabilitation Finance Corporation, No. L-24571,

December 18, 1970, 36 SCRA 289, and later in Torela vs

Torela, No. L-27843, October 11, 1979, 93 SCRA 391.

It is thus clear that before Moises Jocson may validly

invoke the presumption under Article 160 he must first

present proof that the disputed properties were acquired

during the marriage of Emilio Jocson and Alejandra Poblete.

The certificates of title, however, upon which petitioner rests

his claim is insufficient. The fact that the properties were

registered in the name of “Emilio Jocson, married to

Alejandra Poblete” is no proof that the properties were

acquired during the spouses’ coverture. Acquisition of title

and registration thereof are two different acts. It is well

settled that registration does not confer title but merely

confirms one already existing (See Torela vs. Torela, supra).

It may be that the properties under dispute were acquired by

Emilio Jocson when he was still a bachelor but were

registered only after his marriage to Alejandra Poblete,

which explains why he was described in the certificates of

title as married to the latter.

Contrary to petitioner’s position, the certificates of title

show, on their face, that the properties were exclusively

Emilio Jocson’s, the registered owner. This is so because the

words “married to” preceding “Alejandra Poblete” are merely

descriptive of the civil status of Emilio Jocson (Litam v.

Rivera, 100 Phil. 354; Stuart v. Yatco, No. L-16467, April 27,

1962, 4 SCRA 1143; Magallon v. Montejo, G.R. No. L-73733,

December 16, 1986, 146 SCRA 282). In other words, the

import from the certificates of title is that Emilio Jocson is

the owner of the properties, the same having been registered

in his name alone, and that he is married to Alejandra

Poblete.

9

We are not unmindful that in numerous cases We

consistently held that registration of the property in the

name of only one spouse does not negate the possibility of it

being conjugal (SeeBucoy vs. Paulino, No. L-25775, April 26,

1968, 23 SCRA 248). But this ruling is not inconsistent with

the above pronouncement for in those cases there was proof

that the properties, though registered in the name of only

one spouse, were indeed conjugal properties, or that they

have been acquired


REPORTS

ANNOTATED


during the marriage of the spouses, and therefore, presumed

conjugal, without the adverse party having presented proof to

rebut the presumption (See Mendoza vs. Reyes, No. L-31618,

August 17, 1983,124 SCRA 154).

In the instant case, had petitioner, Moises Jocson,

presented sufficient proof to show that the disputed

properties were acquired during his parents’ coverture. We

would have ruled that the properties, though registered in

the name of Emilio Jocson alone, are conjugal properties in

view of the presumption under Article 160. There being no

such proof, the condition sine qua non for the application of

the presumption does not exist. Necessarily, We rule that the

properties under Exhibit 3 are the exclusive properties of

Emilio Jocson.

There being no showing also that the camarin and the two

ricemills, which are the subject of Exhibit 4, were conjugal

properties of the spouses Emilio Jocson and Alejandra

Poblete, they should be considered, likewise, as the exclusive

properties of Emilio Jocson, the burden of proof being on

petitioner.

ACCORDINGLY, the petition is DISMISSED and the

decision of the Court of Appeals is AFFIRMED.

SO ORDERED.

Narvasa, Cruz,Gancayco and Griño-Aquino,

JJ., concur.

Petition dismissed; decision affirmed.

Note.—Close relatives may plausibly find it unnecessary

to reduce a novated written agreement into writing. (Goni vs.

Court of Appeals, 144 SCRA 222.)

——o0o——

10

G.R. Nos. 78583-84. March 26, 1990.*

BENIGNO TODA, JR., petitioner, vs. COURT OF APPEALS

and ROSE MARIE TUASON-TODA, respondents.

G.R. Nos. 78696-97. March 26, 1990.*

ROSE MARIE TUASON-TODA, petitioner, vs.BENIGNO

TODA, JR., respondent.

Civil Law; Property;Conjugal Partnership; The separation of

property is not effected by the mere execution of the contract or

agreement of the parties but by the decree of the court approving the

same; The conjugal partnership is dissolved only upon the issuance

of a decree of separation of property.—We are in agreement with

the holding of the Court of Appeals that the compromise

agreement became effective only on June 9, 1981, the date when it

was approved by the trial court, and not on March 30, 1981 when

it was signed by the parties. Under Article 190 of the Civil Code,

“(i)n the absence of an express declaration in the marriage

settlements, the separation of property between spouses during

the marriage shall not take place save in virtue of a judicial order.”

Hence, the separation of property is not effected by the mere

execution of the contract or agreement of the parties, but by the

decree of the court approving the same. It, therefore, becomes

effective only upon judicial approval, without which it is void.

Furthermore, Article 192 of said Code explicitly provides that

________________

* SECOND DIVISION.

714

7

14

SUPREME COURT

REPORTS

ANNOTATED

Toda, Jr. vs. Court of

Appeals

the conjugal partnership is dissolved only upon the issuance

of a decree of separation of property.

Same; Same; Same; Same;Conjugal partnership of Benigno

and Rose Marie should be considered dissolved only on June 9,

1981 when the Trial Court approved their joint petition for

voluntary dissolution of their conjugal partnership.—

Consequently, the conjugal partnership of Benigno and Rose Marie

should be considered dissolved only on June 9, 1981 when the trial

court approved their joint petition for voluntary dissolution of their

conjugal partnership. Conformably thereto, the cash dividends

declared on July 1, 1981 and July 25, 1981 in the amount of

P2,191.62 and P40,196.12, respectively, should pertain to Rose

Marie; and that declared on April 25, 1981 in the amount of

P37,126.30 ought to be paid to Benigno, pursuant to Paragraph 4

(c) of the compromise agreement which awards to Benigno the

conjugal assets not otherwise specifically assigned to Rose Marie.

Same; Same; Same; Legal presumption that all property of the

marriage belongs to the conjugal partnership absent any proof that

it is the exclusive property of either spouse.—With respect to the

amount of P360,095.12 which Benigno deducted from the P2

million supposed to be paid to Rose Marie, it is not clear from the

records where said amount came from. The Court of Appeals, in

holding that it is conjugal and therefore belongs to Benigno,

presumed it to be in the nature of cash dividends declared prior to

the approval of the compromise agreement by reason of the fact

that the amount was deducted by Benigno from the P2 million

which he paid on April 14, 1981. While no sufficient proof was

adduced to conclusively explain such deduction, there exists the

legal presumption that all property of the marriage belongs to the

conjugal partnership absent any proof that it is the exclusive

property of either spouse. Since Rose Marie failed to prove that the

amount forms part of her paraphernal property, it is presumed to

be conjugal property. Consequently, Benigno is entitled to the said

amount of P360,095.12, hence he rightfully deducted the same

from the amount due to Rose Marie.

PETITION to review the decision of the Court of Appeals.

http://www.central.com.ph/sfsreader/session/00000150809ecc99f5d1d356000a0094004f00ee/p/AMA022/?username=Guest#p183scra8960713001


11


Bautista, Picazo, Buyco, Tan & Fider for Benigno Toda,

Jr.

Belo, Abiera & Associates for petitioner Rose Marie

Tuason-Toda.

715 VOL. 183, MARCH 26,

1990

715

Toda, Jr. vs. Court of Appeals

REGALADO, J.:

These consolidated cases seek a review of the decision of the

Court of Appeals promulgated on January 29, 19871 in CA-

G.R. CV Nos. 06675 and 07936, the dispositive portion of

which reads:

“WHEREFORE, judgment is hereby rendered:

1. 1.Ordering the payment of the cash dividends declared on

July 1, 1981 amounting to P2,191.62 and those declared on

July 25, 1981 amounting to P40,196.12 to Rose Marie

Toda as her separate property. The cash dividends

declared on April 25, 1981 amounting to P37,196.30 (sic)

are hereby adjudicated to Benigno Toda, Jr. as his share in

the conjugal partnership assets; the portion of the order

dated November 2, 1981 with respect to the payment of

the amount of P360,095.12 to Rose Marie T. Toda is set

aside;

2. 2.Ordering the payment of the amount of P4,623,982.24 to

Rose Marie Toda representing the balance of

P15,749,135.32 obligated to be paid as estate taxes by

Benigno Toda, Jr.;

3. 3.Setting aside the order of the lower court dated June 2,

1982 directing Benigno Toda, Jr. to pay interest and non-

payment penalty of 18% and 5%, respectively; and

4. 4.Setting aside the order of the lower court directing the

annotation of lien on the property of Benigno Toda, Jr.

SO ORDERED.”

Benigno Toda, Jr. (Benigno for brevity) and Rose Marie

Tuason-Toda (Rose Marie for brevity) were married on June

9, 1951 and were blessed with two children. Individual

differences and the alleged infidelity of Benigno, however,

marred the conjugal union thereby prompting Rose Marie to

file on December 18, 1979 in the former Court of First

Instance of Rizal,2 as Civil Case No. 35566, a petition for

termination of conjugal partnership for alleged

mismanagement and dissipation of conjugal funds against

Benigno.

After hearings were held, the parties in order to avoid

further

________________

1 Justice Jose A.R. Melo, ponente, with Justices Ricardo P. Tensuan and

Jaime M. Lantin, concurring; Rollo, G.R. Nos. 78583-84, 29-45.

2 Presided over by then Judge Rizalina Bonifacio Vera.


REPORTS

ANNOTATED


“disagreeable proceedings,” filed on April 1, 1981 a joint

petition for judicial approval of dissolution of conjugal

partnership under Article 191 of the Civil Code, docketed as

Special Proceeding No. 9478,3which was consolidated with

the aforesaid civil case. This petition which was signed by the

parties on March 30, 1981, embodied a compromise

agreement allocating to the spouses their respective shares

in the conjugal partnership assets and dismissing with




12

prejudice the said Civil Case No. 35566,CA-G.R. No. 11123-

SP of the Court of Appeals and G.R. No. 56121 of this Court.

The said petition and the compromise agreement therein

were approved by the trial court in its order of June 9, 1981.4

Thereafter, several orders were issued by the lower court

pertaining to the interpretation and implementation of the

compromise agreement, as follows:

1. 1.Order, dated November 20, 1981, ordering Benigno, inter

alia, to pay Rose Marie the cash dividends on the shares

declared on April 25, 1981 amounting to P37,126.30; that

declared on July 25, 1981 amounting to P40,196.12; that

declared on July 1, 1981, given on September 25, 1981

amounting to P2,191.62; and the payment of P360,095.12

to Rose Marie which is the balance of P2 million paid on

April 4, 1981;5

2. 2.Order, dated June 2, 1982, ordering Benigno to pay Rose

Marie interest at 18% per annum on the amounts required

to be paid in the order of November 20, 1981, as well as 5%

non-payment penalty should the said order of November

20, 1981 be sustained on appeal;6

3. 3.Order, dated December 9, 1982, denying Benigno’s motion

to inhibit Judge Rizalina Bonifacio Vera from hearing the

case;7

4. 4.Order, dated March 1, 1983, ordering the annotation of a

lien on certain properties of Benigno as security for any

and all amounts that he may finally be ordered to pay to

Rose Marie under the compromise agreement;8 and

5. 5.Order, dated March 14, 1983, ordering Benigno to pay

Rose Marie the amount of P4,623,929.24, with interest

and penalties thereon

________________

3 Rollo, G.R. Nos. 78696-97, 69-74.

4 Ibid., 75-84.

5 Ibid., 85-98.

6 Ibid., 102-105.

7 Ibid., 62.

8 Ibid., 122-125.

717 VOL. 183, MARCH 26,

1990

717


at the rates stipulated in the compromise agreement from

date of demand by Rose Marie.9

The compromise agreement which, as earlier stated, was

incorporated in the petition for dissolution of the conjugal

partnership and was approved by the court below, contains

the following stipulations:

x x x

“4. For the best interest of each of them, petitioners have agreed

to dissolve their conjugal partnership and to partition the assets

thereof, under the following terms and conditions—this document,

a pleading, being intended by them to embody and evidence their

agreement;

1. “(a)Petitioners as the parties hereto agree upon the

dissolution of their conjugal partnership during the

marriage and further agree to obtain judicial approval of

their said agreement as provided by Article 191 of the

Civil Code.

2. “(b)The following shall be adjudicated to petitioner Rose

Marie Tuason-Toda:

1. (1)Forty Million Pesos (P40,000,000.00) to be paid as

follows:

1. (a)Petitioner Benigno Toda, Jr. shall assume the payment

of the estate taxes, interest and penalties thereon,







13

pertaining to the estate of petitioner Rose Marie Tuason-

Toda’s late brother Manuel Tuason, Jr. in the sum of

P15,749,135.32 as of March 31, 1981—all interest and

penalty charges after March 31, 1981 to be the

responsibility of petitioner Benigno Toda, Jr.

2. (b)P2,000,000.00 to be paid within 30 days after signing of

this agreement.

3. (c)The balance shall be paid within six (6) months after date

of signing of this agreement. If not paid when due, the

balance shall bear interest at 18% per annum until paid

and there shall be a 5% non-payment penalty. The

proceeds from any sale of or loss with respect to, Rubicon’s

shares in Philippine Air Lines, Inc., shares of Cibeles

Insurance Corporation or Hermana Mayor shall be applied

when received against the aforesaid balance, except to the

extent such proceeds are used to satisfy any

________________

9 Ibid., 110-115.


REPORTS

ANNOTATED


1. other obligation under this agreement.

2. (2)All shares of stock in San Miguel Corporation registered

solely in the name of petitioner Rose Marie Tuason-Toda

whether stock dividends or stocks acquired on pre-emptive

rights including those acquired in the names of both

petitioners Benigno Toda, Jr. and Rose Marie Tuason-

Toda (whether jointly or alternately ‘and/or’), free from all

liens and encumbrances.

3. (3)All shares of stock in San Miguel Corporation acquired

whether as stock dividends of or on pre-emptive rights

pertaining to the shares of stock in said corporation of

petitioner Rose Marie Tuason-Toda’s brother the late

Manuel Tuason, Jr. (of course, the original shares of the

latter pertain to petitioner Rose Marie Tuason-Toda also),

free from all liens and encumbrances except for the estate

tax lien. Petitioner Rose Marie Tuason-Toda hereby grants

petitioner Benigno Toda, Jr. an irrevocable proxy, for

three years through the 1983 stockholders’ meeting

whether annual or special to elect directors for all shares

of stock she owns directly or indirectly including those

from the late Manuel Tuason, Jr. in San Miguel

Corporation.

4. (4)The Banaba Forbes Park conjugal dwelling and its

contents free from all liens and encumbrances except that

petitioner Benigno Toda, Jr. shall remove therefrom his

personal effects including furniture and appliances in his

study room and T.V. room and, from the family room, all

antiques, rugs, paintings of Old Fort Manila, books and

mementos. Petitioner Benigno Toda, Jr. commits that no

servant now living in the Tolentino street apartments

shall be evicted.

5. (5)The San Francisco apartment at Apartment 905, No.

1750 Taylor Street, San Francisco, California, U.S.A., and

its contents, free from all liens and encumbrances, except

that petitioner Benigno Toda, Jr. shall remove therefrom

his personal effects.

6. (6)The artifacts already removed by petitioner Rose Marie

Tuason-Toda from the Madrid Apartment at No. 4 San

Pedro de Valdivia. She shall return to it its silver ware,

china ware, paintings and etchings. She may retain the

three fans encased in glass and may remove her clothes,

perfumes and toiletries, the Sansa painting of a shell

dedicated to her, the painting of the Madonna and

14

tapestry hanging in her bedroom, 5 Persian rugs, 1 writing

desk and chair and the 2 lamps thereon and 1 lamp on the

night table, and the statuette given her by Hagedorn.

7. (7)Jewelry.

8. (8)Motor vehicles registered in her name.

719 VOL. 183, MARCH 26,

1990

719


1. (9)Within forty-five (45) days from signing of this

agreement, One Million Pesos (P1,000,000.00) as

attorneys’ fees—petitioner Rose Marie Tuason-Toda

agreeing to hold petitioner Benigno Toda, Jr. harmless

from any claim for attorneys’ fees and expenses that may

be filed against the conjugal partnership or herself for

services rendered to her in the prosecution of her claims

against said conjugal partnership or against petitioner

Benigno Toda, Jr. or to secure her paraphernal estate.

2. (10)Two shares with two lots in Valley Golf & Country

Club.

3. (11)One share in Club Puerta de Hierro in Madrid, Spain if

there is one registered in petitioner Rose Marie Tuason-

Toda’s name.

4. (12)Share in Montemar Beach Club in Bagac, Bataan—

petitioner Rose Marie Tuason-Toda agreeing to asume the

balance of the acquisition cost thereof.

1. “(c)All other properties of the conjugal partnership of

whatever kind wherever located shall be adjudicated to

petitioner Benigno Toda, Jr. even though acquired in the

name of petitioner Rose Marie Tuason-Toda or both of

them—she undertaking to execute the corresponding

deeds of conveyances.

2. “(d)Petitioner Benigno Toda, Jr. shall assume the payment

of all conjugal obligations, petitioner Rose Marie Tuason-

Toda representing and warranting that she has no

pending obligation or incurred no obligation chargeable to

the conjugal partnership except those listed in Annex ‘A’

hereof.“If the Rosaria Apartment is subject to a mortgage

loan and such loan is a conjugal debt, petitioner Benigno

Toda, Jr. shall assume such loan and shall obtain the

discharge of the mortgage.

3. “(e)After the signing of this document:

1. (1)Each of them shall own, dispose of, possess, administer

and enjoy his or her separate estate, present and future,

without the consent of the other;

2. (2)All earnings from any profession business or industry

shall likewise belong to each of them respectively;

3. (3)All expenses and obligations incurred by each of them

shall be their respective and separate responsibilities.

1. “(f)With the signing of this document, Civil Case No.

35566 of this same Court,CA-G.R. No. 11123-SPand SC-

G.R. No. L-56121shall be deemed dismissed with prejudice

as between the parties


REPORTS

ANNOTATED


hereto.”10

The parties then prayed that judgment be rendered:

1. “(a)Approving the agreement for voluntary dissolution and

partition of the conjugal partnership;


15

2. (b)declaring the conjugal partnership of petitioners

dissolved and adjudicating to each of them his or her share

in the properties and assets of said conjugal partnership in

accordance with the agreement embodied in paragraph 4

hereof; and

3. (c)enjoining the parties to comply with the terms and

conditions of the aforesaid agreement.”11

Ironically, the said agreement failed to fully subserve the

intended amicable settlement of all the disputes of the

spouses. Instead, as lamented by the counsel of one of them,

the compromise agreement which was designed to terminate

a litigation spawned two new petitions, with each party

initiating one against the other. Thus, illustrative of the

saying that a solution which creates another problem is no

solution, the contradictory interpretations placed by the

parties on some provisions of the agreement resulted in

appeals to respondent court and, eventually, the present

recourse to us.

Benigno appealed from the aforestated orders of the trial

court of November 20, 1981, June 2, 1982, December 9, 1982,

March 1, 1983 and March 14, 1983 containing the directives

hereinbefore respectively set out. The same were disposed of

by the Court of Appeals as explained at the start of this

decision.

Rose Marie now submits that the Court of Appeals erred:

1. 1.In holding that the compromise agreement of the parties

herein became effective only after its judicial approval on

June 9, 1981 and not upon its execution on March 30,

1981;

2. 2.In setting aside the order of the lower court dated June 2,

1981 directing Benigno to pay interest of eighteen percent

and non-payment penalty of five percent; and

3. 3.In setting aside the order of the lower court directing the

_______________

10 Ibid., 69-73.

11 Ibid., 73.

721 VOL. 183, MARCH 26,

1990

721


On the other hand, Benigno contends in his present petition

before us that:

1. 1.The Court of Appeals erred on a question of law when it

affirmed the lower court’s award of P4,623,929.24 without

trial and evidence-taking and overruled petitioner’s claim

of violation of his due process right;

2. 2.The Court of Appeals erred on a question of law and due

process when it upheld the lower court’s denial of

petitioner’s motion for her inhibition/disqualification;

3. 3.Since the document (the parties’ compromise agreement)

explicitly provided for assumption of liability rather than

agency to pay and since there was no evidence-taking, the

Court of Appeals’ finding of an agency to pay is reviewable

as a question of law; and

4. 4.The Court of Appeals erred on a question of law involving

the parol evidence rule.13

The award of cash dividends basically depends on the date of

effectivity of the compromise agreement as this will

determine whether the same is conjugal property or separate

property of the spouses.

We are in agreement with the holding of the Court of

Appeals that the compromise agreement became effective

only on June 9, 1981, the date when it was approved by the

trial court, and not on March 30, 1981 when it was signed by

the parties. Under Article 190 of the Civil Code,14 “(i)n the




16

absence of an express declaration in the marriage

settlements, the separation of property between spouses

during the marriage shall not take place save in virtue of a

judicial order.” Hence, the separation of property is not

effected by the mere execution of the contract or agreement of

the parties, but by the decree of the court approving the

same. It, therefore, becomes effective only upon judicial

approval, without which it is void.15Furthermore, Article 192

of

_________________

12 Ibid., 22.

13 Ibid., G.R. Nos. 78583-84, 13-26.

14 Now Art. 134 of the Family Code.

15 Lacson vs. Lacson, et al., 24 SCRA 837 (1968); see also Tolentino,Civil

Code, Vol. I, 1987 Ed., 487.


REPORTS

ANNOTATED


dissolved only upon the issuance of a decree of separation of

property.

Consequently, the conjugal partnership of Benigno and

Rose Marie should be considered dissolved only on June 9,

1981 when the trial court approved their joint petition for

voluntary dissolution of their conjugal partnership.

Conformably thereto, the cash dividends declared on July 1,

1981 and July 25, 1981 in the amount of P2,191.62 and

P40,196.12, respectively, should pertain to Rose Marie; and

that declared on April 25, 1981 in the amount of P37,126.30

ought to be paid to Benigno, pursuant to Paragraph 4 (c) of

the compromise agreement which awards to Benigno the

conjugal assets not otherwise specifically assigned to Rose

Marie.

With respect to the amount of P360,095.12 which Benigno

deducted from the P2 million supposed to be paid to Rose

Marie, it is not clear from the records where said amount

came from. The Court of Appeals, in holding that it is

conjugal and therefore belongs to Benigno, presumed it to be

in the nature of cash dividends declared prior to the approval

of the compromise agreement by reason of the fact that the

amount was deducted by Benigno from the P2 million which

he paid on April 14, 1981. While no sufficient proof was

adduced to conclusively explain such deduction, there exists

the legal presumption that all property of the marriage

belongs to the conjugal partnership absent any proof that it

is the exclusive property of either spouse.16Since Rose Marie

failed to prove that the amount forms part of her

paraphernal property, it is presumed to be conjugal property.

Consequently, Benigno is entitled to the said amount of

P360,095.12, hence he rightfully deducted the same from the

amount due to Rose Marie.

The issue regarding the annotation of the lien on

Benigno’s properties has been mooted by our resolution dated

April 3, 1989 wherein, at his instance, we ordered the

cancellation thereof upon his posting of the corresponding

bond. In our resolution of February 26, 1990, we noted

Benigno’s compliance, approved the bond he filed, and

ordered the cancellation of the liens annotated on the

certificates of title of the properties

_______________

16 Article 160, Civil Code.

723 VOL. 183, MARCH 26,

1990

723



17


Likewise, the order denying the motion to inhibit Judge

Rizalina Bonifacio Vera has become academic considering

that she no longer presides over the court where the case was

filed. Besides, as correctly explained by respondent court, the

ground for inhibition raised by Benigno is not valid it being

merely on the basis of the judge having acquired knowledge

of the facts surrounding the agreement of the parties, hence

she would be a material witness to the issue of the true

agreement which is contested by the parties. However, those

facts came to the knowledge of the judge in the course of her

efforts to effect a compromise between parties and are also

known to the parties. This is not a ground for

disqualification; on the contrary, said acts of the judge were

in accord with the rule encouraging compromises in

litigations, especially between members of the same family.

Anent the tax savings of P4,623,982.24 obtained by

Benigno, we hold that this forms part of the P40 million

allocated to Rose Marie under paragraph 4 (b) (1) of the

compromise agreement. We give credit to the ratiocination

thereon of the trial court as quoted with approval by

respondent court:

“The records show that petitioner Benigno Toda, Jr. paid only

P1,125,152.48 in estate taxes, although the amount stated in the

Compromise Agreement was P15,749,135.32. The balance of

P4,623,929.24 is now being claimed by both parties as aforestated.

In the opinion of this court, the pertinent terms of the Agreement

as quoted, are clear and do not require any interpretation. In brief,

under the Agreement, petitioner Rose Marie T. Toda is adjudicated

the fixed sum of P40 million, to be paid as follows: (a) Payment by

petitioner Benigno Toda, Jr. of the estate taxes, interests and

penalties thereon, pertaining to the estate of the late Manuel

Tuason, Jr. in the amount of P15,749,135.32 as of March 31, 1982;

(b) P2 million within 30 days after signing of the Agreement; (c)

the balance within six months after date of signing of the

Agreement. This Court notes that the amount of taxes, interests

and penalties is fixed at P15,749,135.32 and this figure was

provided by Benigno Toda, Jr. There is no provision as contended

by petitioner Benigno Toda, Jr. that the amount was only an

assumed liability and that he could attempt to reduce it by suit or

compromise. It is clear that if the amount of P4,623,929.24 is to be

credited to Benigno Toda, Jr. then the P40 million which petitioner

Rose Marie T. Toda is to receive would be short by that amount.

This VOL. 183, MARCH 26, 1990


REPORTS

ANNOTATED


Benigno Toda, Jr. was constituted as agent to pay to the

government the liability of the estate of the late Manuel Tuason,

Jr. in the fixed amount of P15,749,135.32 and if he was able to

secure a reduction thereof, then he should deliver to his principal

such reduction. . . xxx”17

We do not believe that Benigno was denied due process when

the trial court resolved the motion of Rose Marie for the

payment of P4,623,982.24 without the benefit of a hearing.

The records disclose that the hearing thereon was postponed

twice at the instance of Benigno, which prompted the court to

thereafter consider the motion submitted for resolution on

the basis of the allegations therein and the answer filed by

counsel for both parties. Benigno cannot now be heard to

claim that he was deprived of his day in court. Furthermore,

respondent court correctly held that the issue involved was

more of a question of interpretation of a contract rather than

a determination of facts. Benigno failed to make a plausible

showing that the supposed evidence he had intended to

present, if any, would not be merely collateral matters.

Considering that the amount of P4,623,982.24 actually

forms an integral part of the P40 million (minus the lawful


18

and authorized deductions that may be made therefrom)

which Benigno categorically undertook to pay to Rose Marie,

the same must earn interest at the rate of 18% per annum

and 5% non-payment penalty, the same being included in

and within the contemplation of Paragraph 4 (b) (1) (c) of the

compromise agreement. Said provision of the agreement

provides for the payment of the interest and penalty upon

non-payment of the balance of the P40 million after the

specific authorized deductions therefrom. Since the amount

of P4,623,982.24 was not to be lawfully deducted by Benigno,

as hereinbefore explained, it constitutes part of the

contemplated contingent balance which might turn out to be

due to Rose Marie and, therefore, subject to the imposition of

said increments on Benigno’s liability.

WHEREFORE, the judgment appealed from is hereby

AFFIRMED, with the modification that Benigno Toda, Jr. is

hereby

________________

17 Rollo, G.R. Nos. 78696-97, 61-62.

725 VOL. 183, MARCH 27,

1990

725

United Realty Corporation vs.

Court of Appeals

18% per annum and 5% non-payment penalty on the tax

savings of P4,623,982.24 from date of formal demand until

the same is fully paid.

SO ORDERED.

Melencio-

Herrera(Chairman), Paras, PadillaandSarmiento, JJ.,

concur.

Judgment affirmed with modification.

Note.—When the property is registered in the name of a

Spouse only and there is no showing as to when the property

was acquired by said spouse, the property belongs exclusively

to said spouse. (PNB vs. Court of Appeals,153 SCRA 435.)

——o0o——

19

G.R. No. 70082. August 19, 1991.*

SPOUSES RICKY WONG and ANITA CHAN, LEONARDO

JOSON, JUANITO SANTOS, EMERITO SICAT and

CONRADO LAGMAN, petitioners, vs. HON.

INTERMEDIATE APPELLATE COURT and ROMARICO

HENSON, respondents.

Civil Law; Laches; There is no laches or even finality of

decision to speak of with respect to Romarico since the decision in

Civil Case No. 2224 is null and void for having been rendered

without jurisdiction for failure to observe the notice requirements

prescribed by law.—Hence, laches may not be charged against

Romarico because, aside from the fact that he had no knowledge of

the transactions of his estranged wife, he was also not afforded an

opportunity to defend himself in Civil Case No. 2224. There is no

laches or even finality of decision to speak of with respect to

Romarico since the decision in Civil Case No. 2224 is null and void

for having been rendered without jurisdiction for failure to observe

the notice requirements prescribed by law. Failure to notify

Romarico may not be attributed to the fact that the plaintiffs in

Civil Case No. 2224 acted on the presumption that the Hensons

were still happily married because the complaint itself shows that

they did not consider Romarico as a party to the transaction which

Katrina undertook with Anita Wong. In all likelihood, the

plaintiffs merely impleaded Romarico as a nominal party in the

case pursuant to the provisions of Rule 3, Section 4 of the Rules of

Court.

Same; Property; Properties acquired during the marriage

presumed to belong to the conjugal partnership.—On the matter of

ownership of the properties involved, however, the Court disagrees

with the appellate court that the said properties are exclusively

owned by Romarico. Having been acquired during the marriage,

they are still presumed to belong to the conjugal partnership even

though Romarico and Katrina had been living separately.

Same; Same; Same; In the determination of the nature of a

property acquired by a person during coverture, the controlling

factor is the source of the money utilized in the purchase.—The

presumption of the conjugal nature of the properties subsists in

the absence of clear, satisfactory and convincing evidence to

overcome said presumption or to prove that the properties are

exclusively owned by Romarico. While there is proof that Romarico

acquired the properties with money he had borrowed from an

officemate, it is unclear where he obtained the money to repay the

loan. If he paid it out of his salaries, then the money is part of the

conjugal assets and not exclusively his. Proof on this matter is of

paramount importance considering that in the determination of

the nature of a property acquired by a person during covertrue, the

controlling factor is the source of the money utilized in the

purchase.

Same; Same; Same;Circumstances when wife may bind the

conjugal partnership.—Furthermore, under the Civil Code (before

the effectivity of the Family Code on August 3, 1988), 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 the purpose of purchasing things necessary for the support of

the family if the husband fails to deliver the proper sum; when the

administration of the conjugal partnership is transferred to the

wife by the courts or by the husband, and when the wife gives

moderate donations for charity.

PETITION for certiorari to review the decisions of the then

Intermediate Appellate Court.


Feliciano C. Tumale for petitioners.

Benjamin Dadios andBausa, Ampil, Suarez,Paredes &

Bausa for private respondent.

FERNAN, C.J.:

http://www.central.com.ph/sfsreader/session/0000015080a0148f8faeef3d000a0094004f00ee/p/AKE968/?username=Guest#p200scra8960792001

20

Submitted for adjudication in the instant petition for review

on certiorari is the issue of whether or not the execution of a

decision in an action for collection of a sum of money may be

nullified on the ground that the real properties levied upon

and sold at public auction are the alleged exclusive

properties of a husband who did not participate in his wife’s

business transaction from which said action stemmed.

Private respondent Romarico Henson married Katrina

Pineda on January 6, 1964.1 They have three children but

even during the early years of their marriage, Romarico and

Katrina had been most of the time living separately. The

former stayed in Angeles City while the latter lived in

Manila. During the marriage or on January 6, 1971,

Romarico bought a 1,787-square-meter parcel of land in

Angeles City for P11,492 from his father, Dr. Celestino L.

Henson2 with money borrowed from an officemate. His father

needed the amount for investments in Angeles City and

Palawan.3

Meanwhile, in Hongkong sometime in June 1972, Katrina

entered into an agreement with Anita Chan whereby the

latter consigned to Katrina pieces of jewelry for sale valued

at 199,895 Hongkong dollars or P321,830.95.4 When Katrina

failed to return the pieces of jewelry within the 20-day period

agreed upon, Anita Chan demanded payment of their value.

On September 18, 1972, Katrina issued in favor of Anita

Chan a check for P55,000 which, however, was dishonored for

lack of funds. Hence, Katrina was charged with estafa before

the then Court of First Instance of Pampanga and Angeles

City, Branch IV.5 After trial, the lower court rendered a

decision dismissing the case on the ground that Katrina’s

liability was not criminal but civil in nature as no estafa was

committed by the issuance of the check in payment of a pre-

existing obligation.6

In view of said decision, Anita Chan and her husband

Ricky Wong filed against Katrina and her husband Romarico

Henson, an action for collection of a sum of money also in the

same branch of the aforesaid court.7The records of the case

show that Atty. Gregorio Albino, Jr. filed an answer with

counterclaim but only in behalf of Katrina. When the case

was called for pretrial, Atty. Albino once again appeared as

counsel for Katrina only. While it is true that during

subsequent hearings, Atty. Expedito Yumul, who

collaborated with Atty. Albino, appeared for the defendants,

it is not shown on record that said counsel also represented

Romarico. In fact, a power of attorney which Atty. Albino

produced during the trial, showed that the same was

executed solely by Katrina.8

After trial, the court promulgated a decision9 in favor of

the Wongs. It ordered Katrina and Romarico Henson to pay

the Wongs HK$199,895.00 or P321,830.95 with legal interest

from May 27, 1975, the date of filing of the complaint, until

fully paid; P20,000 as expenses for litigation; P15,000 as

attorney’s fees, and the costs of the suit.

A writ of execution was thereafter issued. Levied upon

were four lots in Angeles City covered by Transfer

Certificates of Title Nos. 30950, 30951, 30952 and 30953 all

in the name of “Romarico Henson x x x married to Katrina

Henson.”10

The public auction sale was first set for October 30, 1977

but since said date was declared a public holiday, Deputy

Sheriff Emerito Sicat reset the sale to November 11, 1977.

On said date, the following properties registered in the name

of Romarico Henson “married to Katrina Henson” were sold

at public auction: (a) two parcels of land covered by Transfer

Certificates of Title Nos. 30950 and 30951 with respective

areas of 293 and 289 square meters at P145,000 each to

Juanito L. Santos,11 and (b) two parcels of land covered by

Transfer Certificates of Title Nos. 30952 and 30953 with

respective areas of 289 and 916 square meters in the amount

of P119,000.00 to Leonardo B. Joson.12













21

After the inscription on Transfer Certificate of Title No.

30951 of the levy on execution of the judgment in Civil Case

No. 2224, the property covered by said title was

extrajudicially foreclosed by the Rural Bank of Porac,

Pampanga on account of the mortgage loan of P8,000 which

Romarico and Katrina had obtained from said bank. The

property was sold by the sheriff to the highest bidder for

P57,000 on September 9, 1977. On September 14, 1978,

Juanito Santos, who had earlier bought the same property at

public auction on November 11, 1977, redeemed it by paying

the sum of P57,000 plus the legal interest

_______________

8 Decision in Civil Case No. 2859, pp. 12-15.

9 Penned by Judge Felisa de la Fuente-Samson.

10 Exhs. Nos. A to D.

11 Exh. 5—Juanito Santos.

12 Exh. 6—Joson.


REPORTS

ANNOTATED

Wong vs. Intermediate

Appellate Court

of P6,840.00 or a total amount of P63,840.00.13

About a month before such redemption or on August 8,

1978, Romarico filed an action for the annulment of the

decision in Civil Case No. 2224 as well as the writ of

execution, levy on execution and the auction sale therein in

the same Court of First Instance.14 Romarico alleged that he

was “not given his day in court” because he was not

represented by counsel as Attys. Albino and Yumul appeared

solely for Katrina; that although he did not file an answer to

the complaint he was not declared in default in the case; that

while Atty. Albino received a copy of the decision, he and his

wife were never personally served a copy thereof; that he had

nothing to do with the business transactions of Katrina as he

did not authorize her to enter into such transactions; and

that the properties levied on execution and sold at public

auction by the sheriff were his capital properties and

therefore, as to him, all the proceedings had in the case were

null and void.

On November 10, 1978, the lower court issued an order

restraining the Register of Deeds of Angeles City from

issuing the final bill of sale of Transfer Certificates of Title

Nos. 30950 and 30951 in favor of Juanito Santos and

Transfer Certificates of Title Nos. 30952 and 30953 in favor

of Leonardo Joson until further orders of the court.15On

January 22, 1979, upon motion of Romarico, the court issued

a writ of preliminary injunction enjoining the sheriff from

approving the final bill of sale of the land covered by the

aforementioned certificates of title and the Register of Deeds

of Angeles City from registering said certificates of title in

the names of Santos and Joson until the final outcome of the

case subject to Romarico’s posting of a bond in the amount of

P321,831.00.16

After trial on the merits, the lower court17 rendered a

decision

_______________

13 Exh. 4—Santos.

14 Civil Case No. 2859.

15 Record on Appeal, p. 25.

16 Ibid., p. 54.

17 Presided by Judge Ignacio M. Capulong. The presiding judge of Branch

IV had earlier inhibited himself from taking cognizance of the case. Hence,

Civil Case No. 2859 was transferred to Branch V of the same court.

797






22

VOL. 200, AUGUST 19,

1991

797


Appellate Court

holding that Romarico was indeed not given his day in court

as he was not represented by counsel nor was he notified of

the hearings therein although he was never declared in

default. Noting that the complaint in Civil Case No. 2224 as

well as the testimonial and documentary evidence adduced at

the trial in said case do not show that Romarico had

anything to do with the transactions between Katrina and

Anita Chan, the court ruled that the judgment in Civil Case

No. 2224 “is devoid of legal or factual basis which is not even

supported by a finding of fact or ratio decidendi in the body of

the decision, and may be declared null and void x x x

pursuant to a doctrine laid down by the Supreme Court to

the effect that ‘the Court of First Instance or a branch

thereof, has authority and jurisdiction to try and decide an

action for annulment of a final and executory judgment or

order rendered by another court of first instance or of a

branch thereof’ (Gianan vs. Imperial,55 SCRA 755).”18

On whether or not the properties levied upon and sold at

public auction may be reconveyed to Romarico, the court,

finding that there was no basis for holding the conjugal

partnership liable for the personal indebtedness of Katrina,

ruled in favor of reconveyance in view of the jurisprudence

that the interest of the wife in the conjugal partnership

property being inchoate and therefore merely an expectancy,

the same may not be sold or disposed of for value until after

the liquidation and settlement of the community assets. The

dispositive portion of the decision reads:

“WHEREFORE, and in view of the foregoing, judgment is hereby

rendered in favor of the plaintiff and against all the defendants, as

follows:

“(a) The Decision of the Court of First Instance of Pampanga

and Angeles City, Branch IV, rendered in Civil Case No. 2224,

entitled “RICKY WONG, ET AL. vs. KATRINA PINEDA HENSON

and RO-

_______________

18 Pursuant to Section 9 (2) of Batas Pambansa Blg. 129, the Court of Appeals

now exercises exclusive original jurisdiction over actions for annulment of

judgments of the Regional Trial Courts (Islamic Da’Wah Council of the

Philippines vs. Court of Appeals, G.R. No. 80892, September 29, 1989, 178 SCRA

178; Liwag vs. Court of Appeals, G.R. No. 86094, December 20, 1989, 180 SCRA

420).


REPORTS

ANNOTATED


Appellate Court

MARICO HENSON”, is hereby declared null and void, only as far

as it affects plaintiff herein Romarico Henson;

1. “(b)The Writ of Execution, levy in execution and auction

sale of the conjugal property of the spouses Romarico

Henson and Katrina Pineda Henson which were sold at

public auction on November 11, 1977, without notice to

plaintiff herein, by Deputy Sheriff Emerito Sicat, are

likewise declared null and void and of no force and effect;

2. “(c)Defendants Emerito Sicat and Conrado Lagman, in their

official capacity as Sheriff and Register of Deeds,

respectively, are enjoined permanently from issuing and/or

registering the corresponding deeds of sale affecting the

property;


23

3. “(d)The aforementioned buyers are directed to reconvey the

property they have thus purchased at public auction to

plaintiff Romarico Henson;

4. “(e)As far as the claim for reimbursement filed by Juanito

Santos concerning the redemption of the property covered

by Transfer Certificate of Title No. 30951 from the Rural

Bank of Porac, which foreclosed the same extrajudicially,

is concerned, plaintiff Romarico Henson may redeem the

same within the period and in the manner prescribed by

law, after the corresponding deed of redemption shall have

been registered in the Office of the Registry of Deeds for

Angeles City;

5. “(f)Defendants Spouses Ricky Wong and Anita Chan are,

with the exception of the defendants Juanito Santos,

Leonardo Joson, Sheriff and Register of Deeds, are ordered

jointly and severally, to pay the plaintiff Romarico Henson

the sum of P10,000.00, corresponding to the expenses of

litigation, with legal interest thereon from the time this

suit was filed up to the time the same shall have been

paid, plus P5,000.00 for and as attorney’s fees, and the

costs of suit; and

6. “(g)The counterclaims respectively filed on behalf of all the

defendants in the above-entitled case are hereby

DISMISSED.

“SO ORDERED.”

The defendants appealed to the then Intermediate Appellate

Court. In its decision of January 22, 198519the said court

affirmed in toto the decision of the lower court. It added that

as to Romarico, the judgment in Civil Case No. 2224 had not

attained finality as the decision therein was not served on

him

_______________

19 Penned by Justice Eduardo P. Caguioa and concurred in by Justices

Ramon G. Gaviola, Jr., Ma. Rosario Quetulio-Losa and Leonor Ines Luciano.

799 VOL. 200, AUGUST 19,

1991

799


Appellate Court

and that he was not represented by counsel. Therefore,

estoppel may not be applied against him as, not having been

served with the decision, Romarico did not know anything

about it. Corollarily, there can be no valid writ of execution

inasmuch as the decision had not become final as far as

Romarico is concerned.

On whether the properties may be levied upon as conjugal

properties, the appellate court ruled in the negative. It noted

that the properties are Romarico’s exclusive capital having

been bought by him with his own funds. But granting that

the properties are conjugal, they cannot answer for Katrina’s

obligations as the latter were exclusively hers because they

were incurred without the consent of her husband, they were

not for the daily expenses of the family and they did not

redound to the benefit of the family. The court underscored

the fact that no evidence has been submitted that the

administration of the conjugal partnership had been

transferred to Katrina either by Romarico or by the court

before said obligations were incurred.

The appellants filed a motion for reconsideration of the

decision of the appellate court but the same was denied for

lack of merit on February 6, 1985.20

Hence, the instant petition for review on certiorari.

Petitioners contend that, inasmuch as the Henson spouses

were duly represented by Atty. Albino as shown by their

affidavit of August 25, 1977 wherein they admitted that they

were represented by said counsel until Atty. Yumul took over

the actual management and conduct of the case and that



24

Atty. Albino had not withdrawn as their counsel, the lower

court “did not commit an error” in serving a copy of the

decision in Civil Case No. 2224 only on Atty. Albino.

Moreover, during the 2-year period between the filing of the

complaint in Civil Case No. 2224 and the public auction sale

on November 11, 1977, Romarico remained silent thereby

making him in estoppel and guilty of laches.

Petitioners further aver that there being sufficient

evidence that the auction sale was conducted in accordance

with law, the acts of the sheriffs concerned are presumed to

be regular and valid. But granting that an irregularity

consisting of the nonnotification of Romarico attended the

conduct of the auction sale, the rights of Santos and Joson

who were “mere strangers

_______________

20 Rollo, p. 56.


REPORTS

ANNOTATED


Appellate Court

who participated as the highest bidders” therein, may not be

prejudiced. Santos and Joson bought the properties sincerely

believing that the sheriff was regularly performing his duties

and no evidence was presented to the effect that they acted

with fraud or that they connived with the sheriff. However,

should the auction sale be nullified, petitioners assert that

Romarico should not be unduly enriched at the expense of

Santos and Joson.

The petitioners’ theory is that Romarico Henson was

guilty of laches and may not now belatedly assert his rights

over the properties because he and Katrina were represented

by counsel in Civil Case No. 2224. Said theory is allegedly

founded on the perception that the Hensons were like any

other ordinary couple wherein a spouse knows or should

know the transactions of the other spouse which necessarily

must be in interest of the family. The factual background of

this case, however, takes it out of said ideal situation.

Romarico and Katrina had in fact been separated when

Katrina entered into a business deal with Anita Wong. Thus,

when that business transaction eventually resulted in the

filing of Civil Case No. 2224, Romarico acted, or, as charged

by petitioners, failed to act, in the belief that he was not

involved in the personal dealings of his estranged wife. That

belief was buttressed by the fact that the complaint itself did

not mention or implicate him other than as the husband of

Katrina. On whether Romarico was also represented by Atty.

Albino, Katrina’s counsel, the courts below found that:

“x x x Atty. Albino filed an Answer with Counterclaims dated July

25, 1975 solely on behalf of defendant Katrina Henson. The

salutary statement in that Answer categorically reads: ‘x x x

COMES NOW THE DEFENDANT KATRINA HENSON by and

through undersigned counsel, in answer to plaintiffs’ complaint

respectfully alleges: x x x.’

“That Answer was signed by GREGORIO ALBINO, JR., over

the phrase ‘COUNSEL FOR DEFENDANT KATRINA HENSON.’

“Again, when Civil Case No. 2224 was called for pre-trial on

November 27, 1975, before then Presiding Judge Bienvenido

Ejercito, it is clearly stated on page 2 of the day’s stenographic

notes, under ‘APPEARANCES’ that Atty. Albino, Jr. appeared as

‘COUNSEL FOR DEFENDANT KATRINA HENSON.’ And when

the case was called, Atty. Jose Baltazar, Sr. appeared for the

plaintiffs while Atty. Albino

801 VOL. 200, AUGUST 19,

1991

801


25

Appellate Court

categorically appeared ‘FOR DEFENDANT KATRINA HENSON.’

“It might be true that in subsequent hearings, Atty. Expedito

Yumul ‘appeared as counsel for the defendants’, but the whole

trouble is that he never expressly manifested to the Court that he

was likewise actually representing defendant ‘ROMARICO

HENSON’, for it cannot be disputed that Atty. Yumul only entered

his appearance in collaboration with Atty. Albino (see p. 2 tsn,

January 26, 1976, Espinosa), who in turn entered his initial

appearance during the pre-trial, and through the filing of an

Answer, for defendant KATRINA HENSON. As a matter of fact

the Power of Attorney which Atty. Albino produced during the pre-

trial was executed solely by defendant KATRINA HENSON.

Accordingly, as collaborating counsel, Atty. Yumul cannot, by any

stretch of the imagination, be considered as duly authorized to

formally appear likewise on behalf of defendant ROMARICO

HENSON for whom principal counsel of record Atty. Gregorio

Albino, Jr. never made any formal appearance. On this score, it is

not amiss to state that ‘A spring cannot rise higher than its

source.’

“Now, what about that statement in the aforementioned joint

affidavit of the spouses KATRINA HENSON and ROMARICO

HENSON, to the effect that ‘our first lawyer in said case was Atty.

Gregorio Albino, Jr., and sometime later Atty. Expedito B. Yumul

took over x x x.’

“That statement which plaintiff ROMARICO HENSON was

made to sign by Atty. Yumul on August 25, 1977, after the filing of

this case, allegedly for the purpose of dissolving the writ of

execution, as claimed in paragraph XIV of the complaint herein,

and is satisfactorily explained by both plaintiff herein and his wife,

while on cross-examination by Atty. Baltazar, Sr., and We quote:

‘Q So, the summons directed

your filing of your Answer

for both of you, your wife

and your good self?

‘A Yes, sir but may I add, I

received the summons but

I did not file an answer

because my wife took a

lawyer and that lawyer I

think will protect her

interest and my interest

being so I did not have

nothing to do in the

transaction which is

attached to the complaint.’

(TSN, Jan. 14, 1980, pp.

52-53).

“That plaintiff never appeared

in Civil Case No. 2224, nor

was

he therein represented by

counsel was impliedly

admitted

by defendants’ counsel of

records thru a question he

prop-

ounded on cross, and the

answer given by Katrina Pi-

neda, to wit:

‘Q How about your husband,

do you remember if he

physically appeared in that

Civil Case No. 2224, will

you tell us


REPORTS

ANNOTATED


26

Appellate Court

if he was represented by

counsel as a party

defendant?

‘A No, sir, he did not appear.

‘Q You are husband and

wife, please tell us the

reason why you have

your own counsel in that

case whereas Romarico

Henson did not appear

nor a counsel did not

appear in that

proceedings?’ (TSN, Feb.

25, 1980, pp. 6-7).

x x x x x x x x x.

‘A Because that case is my

exclusive and personal

case, he has nothing to do

with that, sir.’ (TSN, Feb.

25, 1980, p. 9).”

(Rollo, pp. 17-20)

Hence, laches may not be charged against Romarico because,

aside from the fact that he had no knowledge of the

transactions of his estranged wife, he was also not afforded

an opportunity to defend himself in Civil Case No.

2224.21 There is no laches or even finality of decision to speak

of with respect to Romarico since the decision in Civil Case

No. 2224 is null and void for having been rendered without

jurisdiction for failure to observe the notice requirements

prescribed by law.22 Failure to notify Romarico may not be

attributed to the fact that the plaintiffs in Civil Case No.

2224 acted on the presumption that the Hensons were still

happily married because the complaint itself shows that they

did not consider Romarico as a party to the transaction which

Katrina undertook with Anita Wong. In all likelihood, the

plaintiffs merely impleaded Romarico as a nominal party in

the case pursuant to the provisions of Rule 3, Section 4 of the

Rules of Court.

Consequently, the writ of execution cannot be issued

against Romarico as he has not yet had his day in court23and,

necessarily, the public auction sale is null and

void.24Moreover, the power of the court in the execution of

judgments extends only

_______________

21 Bailon-Casilao v. Court of Appeals, G.R. No. 78178, April 15, 1988, 160

SCRA 738, 747.

22 Portugal v. Reantasa, L-46078, November 24, 1988, 167 SCRA 712.

23 New Owners/Management of TML Garments, Inc. v. Zaragoza,G.R. No.

75866, February 23, 1989,170 SCRA 563; Vda. de Medina v. Cruz, L-39272,

May 4, 1988, 161 SCRA 36.

24 Ver v. Quetulio, G.R. No. 77526, June 29, 1988, 163 SCRA 80.

803 VOL. 200, AUGUST 19,

1991fs

803


Appellate Court

over properties unquestionably belonging to the judgment

debtor.25

On the matter of ownership of the properties involved,

however, the Court disagrees with the appellate court that

the said properties are exclusively owned by Romarico.

Having been acquired during the marriage, they are still

presumed to belong to the conjugal partnership26 even though

Romarico and Ka-trina had been living separately.27

The presumption of the conjugal nature of the properties

subsists in the absence of clear, satisfactory and convincing

evidence to overcome said presumption or to prove that the








27

properties are exclusively owned by Romarico.28 While there

is proof that Romarico acquired the properties with money he

had borrowed from an officemate, it is unclear where he

obtained the money to repay the loan. If he paid it out of his

salaries, then the money is part of the conjugal assets29 and

not exclusively his. Proof on this matter is of paramount

importance considering that in the determination of the

nature of a property acquired by a person during covertrue,

the controlling factor is the source of the money utilized in

the purchase.

The conjugal nature of the properties notwithstanding,

Katrina’s indebtedness may not be paid for with them her

obligation not having been shown by the petitioners to be one

of the charges against the conjugal partnership.30 In addition

to the fact that her rights over the properties are merely

inchoate prior to the liquidation of the conjugal partnership,

the consent of her husband and her authority to incur such

indebtedness had not been alleged in the complaint and

proven at the trial.31

_______________

25 Escovilla, Jr. v. Court of Appeals, G.R. No. 84497, November 6,

1989, 179 SCRA 109; Ong v. Tating, G.R. No. 61042, April 15, 1987, 149

SCRA 265.

26 Art. 160, Civil Code; Cuenca v. Cuenca, G.R. No. 72321, December 8,

1988, 168 SCRA 335.

27 Art. 178, Ibid., Flores v. Escudero, 92 Phil. 786.

28 Ahern v. Julian, 39 Phil. 607.

29 Art. 153 (2), Civil Code.

30 Art. 161, Ibid.; Lacson v. Diaz,L-19346, May 31, 1965, 14 SCRA 183.

31 Art. 172, Ibid.; Manaois-Salonga v. Natividad, 107 Phil. 268.


REPORTS

ANNOTATED


Appellate Court

Furthermore, under the Civil Code (before the effectivity of

the Family Code on August 3, 1988), 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 the purpose of purchasing things necessary for the

support of the family if the husband fails to deliver the

proper sum;32when the administration of the conjugal

partnership is transferred to the wife by the courts33 or by the

husband,34and when the wife gives moderate donations for

charity.35 Having failed to establish that any of these

circumstances occurred, the Wongs may not bind the

conjugal assets to answer for Katrina’s personal obligation to

them.

Petitioners’ contention that the rights of Santos and Joson

as innocent buyers at the public auction sale may not be

prejudiced, is, to a certain extent, valid. After all, in the

absence of proof that irregularities attended the sale, the

same must be presumed to have been conducted in

accordance with law. There is, however, a peculiar factual

circumstance that goes against the grain of that general

presumption—the properties levied upon and sold at the

public auction do not exclusively belong to the judgment

debtor. Thus, the guiding jurisprudence is as follows:

“The rule in execution sales is that an execution creditor acquires

no higher or better right than what the execution debtor has in the

property levied upon. The purchaser of property on sale under

execution and levy takes as assignee only, as the judicial seller

possesses no title other than that which would pass by an

assignment by the owner. ‘An execution purchaser generally

acquires such estate or interest as was vested in the execution

debtor at the time of the seizure on execution, and only such

interest, taking merely a quit-claim of the execution debtor’s title,









28

without warranty on the part of either the execution officer or of

the parties, whether the property is realty or personalty. This rule

prevails even if a larger interest in the property was intended to be

sold. Accordingly, if the judgment debtor had no

_______________

32 Art. 115.

33 Arts. 196, 167 & 178.

34 Art. 168.

35 Art. 174.

805 VOL. 200, AUGUST 19,

1991

805


Appellate Court

interest in the property, the execution purchaser acquires no

interest therein.’ ” (Pacheco vs. Court of Appeals, L-48689, August

31, 1987, 153 SCRA 382, 388-389 quoting Laureano vs.

Stevenson, 45 Phil. 252; Cabuhat vs. Ansery, 42 Phil. 170; Fore v.

Manove, 18 Cal. 436 and 21 Am. Jur., 140-141. Italics supplied.)

Applying this jurisprudence, execution purchasers Santos

and Joson possess no rights which may rise above judgment

debtor Katrina’s inchoate proprietary rights over the

properties sold at public auction. After all, a person can sell

only what he owns or is authorized to sell and the buyer can,

as a consequence, acquire no more than what the seller can

legally transfer.36 But, inasmuch as the decision in Civil Case

No. 2224 is void only as far as Romarico and the conjugal

properties are concerned, the same may still be executed by

the Spouses Wong against Katrina Henson personally and

exclusively. The Spouses Wong must return to Juanito

Santos and Leonardo Joson the purchase prices of P145,000

and P119,000 respectively, received by said spouses from the

public auction sale.

The redemption made by Santos in the foreclosure

proceeding against Romarico and Katrina Henson filed by

the Rural Bank of Porac should, however, be respected unless

Romarico exercises his right of redemption over the property

covered by Transfer Certificate of Title No. 30951 in

accordance with law.

WHEREFORE, the decisions of the appellate court and

the lower court in Civil Case No. 2859 are hereby

AFFIRMED subject to the modifications above-stated. No

costs.

SO ORDERED.

Gutierrez, Jr.,Feliciano, Bidin and Davide, Jr.,

JJ., concur.

Decisions affirmed with modifications.

——o0o——

_______________

36 See: Segura v. Segura, L-29320, September 19, 1988, 165 SCRA 368, 374


29

G.R. No. 122749. July 31, 1996.*

ANTONIO A.S. VALDES, petitioner, vs. REGIONAL TRIAL

COURT, BRANCH 102, QUEZON CITY, and CONSUELO

M. GOMEZ-VALDES, respondents.

Civil Law; Family Code; In a void marriage, regardless of the

cause thereof, the property relations of the parties during the period

of cohabitation is governed by the provisions of Article 147 or

Article 148 of the Family Code.—The trial court correctly applied

the law. In a void marriage, regardless of the cause thereof, the

property relations of the parties during the period of cohabitation

is governed by the provisions of Article 147 or Article 148, such as

the case may be, of the Family Code.

Same; Same; Property acquired by both spouses through their

work and industry shall be governed by the rules on equal co-

ownership.—Under this property regime, property acquired by

both spouses through their workand industry shall be governed by

the rules on equal co-ownership. Any property acquired during the

union is prima facie presumed to have been obtained through their

joint efforts. A party who did not participate in the acquisition of

the property shall still be considered as having contributed thereto

jointly if said party’s “efforts consisted in the care and

maintenance of the family household.” Unlike the conjugal

partnership of gains, the fruits of the couple’s separate property

are not included in the co-ownership.

Same; Same; When the common-law spouses suffer from a

legal impediment to marry or when they do not live exclusively with

each other, 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.—When 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 theiractual joint contribution of money,

property or industry shall be owned in common and inproportion to

their respective contributions. Such contributions and

corresponding shares, however, are prima faciepresumed to be

equal. The share of any party who is married to another shall

accrue to the absolute community or conjugal partnership, as the

case may be, if so existing under a valid marriage. If the party who

has acted in bad faith is not validly married to another, his or her

share shall be forfeited in the manner already heretofore

expressed.

Same; Same; The first paragraph of Article 50 of the Family

Code, applying paragraphs (2), (3), (4) and (5) of Article 43 relates

only by its explicit terms, to voidable marriages and exceptionally,

to void marriages under Article 40 of the Code.—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 co-ownership

that exists between common-law spouses. The first paragraph of

Article 50 of the Family Code, applying paragraphs (2), (3), (4) and

(5)of Article 43, relates only, by its explicit terms,

to voidablemarriages and, exceptionally, tovoid marriages under

Article 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. The latter is

a special rule that somehow recognizes the philosophy and an old

doctrine that void marriages are inexistent from the very

beginning and no judicial decree is necessary to establish their

nullity.

PETITION for review of a decision of the Regional Trial

Court of Quezon City, Br. 102.


Romulo, Mabanta,Buenaventura, Sayoc & De los

Angeles for petitioner.

Roco, Buñag, Kapunan & Migallos for private

respondent.

http://www.central.com.ph/sfsreader/session/0000015080a4ba21ca0f7aad000a0094004f00ee/p/AKC414/?username=Guest#p260scra8960221001

30

VITUG, J.:

The petition for review bewails, purely on a question of law,

an alleged error committed by the Regional Trial Court

in Civil Case No. Q-92-12539. Petitioner avers that the

court a quo has failed to apply the correct law that should

govern the disposition of a family dwelling in a situation

where a marriage is declared void ab initiobecause of

psychological incapacity on the part of either or both of the

parties to the contract.

The pertinent facts giving rise to this incident are, by and

large, not in dispute.

Antonio Valdes and Consuelo Gomez were married on 05

January 1971. Begotten during the marriage were five

children. In a petition, dated 22 June 1992, Valdes sought

the declaration of nullity of the marriage pursuant to Article

36 of the Family Code (docketed Civil Case No. Q-92-12539,

Regional Trial Court of Quezon City, Branch 102). After

hearing the parties following the joinder of issues, the trial

court,1 in its decision of 29 July 1994, granted the

petition; viz:

“WHEREFORE, judgment is hereby rendered as follows:

“(1) The marriage of petitioner Antonio Valdez and respondent

Consuelo Gomez-Valdes is hereby declared null and void under

________________

1 Hon. Perlita Tria Tirona, presiding.


REPORTS

ANNOTATED

Valdes vs. Regional Trial

Court, Br. 102, Quezon City

Article 36 of the Family Code on the ground of their mutual

psychological incapacity to comply with their essential marital

obligations;

“(2) The three older children, Carlos Enrique III, Antonio

Quintin and Angela Rosario shall choose which parent they would

want to stay with.

“Stella Eloisa and Joaquin Pedro shall be placed in the custody

of their mother, herein respondent Consuelo Gomez-Valdes.

“The petitioner and respondent shall have visitation rights over

the children who are in the custody of the other.

“(3) The petitioner and respondent are directed to start

proceedings on the liquidation of their common properties as

defined by Article 147 of the Family Code, and to comply with the

provisions of Articles 50, 51 and 52 of the same code, within thirty

(30) days from notice of this decision.

“Let a copy of this decision be furnished the Local Civil

Registrar of Mandaluyong, Metro Manila, for proper recording in

the registry of marriages.”2(Italics ours.)

Consuelo Gomez sought a clarification of that portion of the

decision directing compliance with Articles 50, 51 and 52 of

the Family Code. She asserted that the Family Code

contained no provisions on the procedure for the liquidation

of common property in “unions without marriage.”

Parenthetically, during the hearing on the motion, the

children filed a joint affidavit expressing their desire to

remain with their father, Antonio Valdes, herein petitioner.

In an Order, dated 05 May 1995, the trial court made the

following clarification:

“Consequently, considering that Article 147 of the Family Code

explicitly provides that the property acquired by both parties

during their union, in the absence of proof to the contrary, are

presumed to have been obtained through the joint efforts of the

parties and will be owned by them in equal shares, plaintiff and

defendant will own their ‘family home’ and all their other

properties for that matter in equal shares.



31

_________________

2 Rollo, p. 22.

225 VOL. 260, JULY 31,

1996

225



“In the liquidation and partition of the properties owned in

common by the plaintiff and defendant, the provisions on co-

ownership found in the Civil Code shall apply.”3 (Emphasis

supplied.)

In addressing specifically the issue regarding the disposition

of the family dwelling, the trial court said:

“Considering that this Court has already declared the marriage

between petitioner and respondent as null and void ab initio,

pursuant to Art. 147, the property regime of petitioner and

respondent shall be governed by the rules on co-ownership.

“The provisions of Articles 102 and 129 of the Family Code finds

no application since Article 102 refers to the procedure for the

liquidation of the conjugal partnership property and Article 129

refers to the procedure for the liquidation of the absolute

community of property.”4

Petitioner moved for a reconsideration of the order. The

motion was denied on 30 October 1995.

In his recourse to this Court, petitioner submits that

Articles 50, 51 and 52 of the Family Code should be held

controlling; he argues that:

“I

“Article 147 of the Family Code does not apply to cases where the

parties are psychologically incapacitated.

“II

“Articles 50, 51 and 52 in relation to Articles 102 and 129 of the

Family Code govern the disposition of the family dwelling in cases

where a marriage is declared void ab initio, including a marriage

declared void by reason of the psychological incapacity of the

spouses.

_________________

3 Rollo, p. 42.

4 Rollo, pp. 38-39.


REPORTS

ANNOTATED



“III

“Assuming arguendo that Article 147 applies to marriages

declared void ab initio on the ground of the psychological

incapacity of a spouse, the same may be read consistently with

Article 129.

“IV

“It is necessary to determine the parent with whom majority of

the children wish to stay.”5

The trial court correctly applied the law. In a void marriage,

regardless of the cause thereof, the property relations of the

parties during the period of cohabitation is governed by the

provisions of Article 147 or Article 148, such as the case may

be, of the Family Code. Article 147 is a remake of Article 144

of the Civil Code as interpreted and so applied in previous

cases;6 it provides:





32

“ART. 147. When a man and a woman who are capacitated to

marry each other, live exclusively with each other as husband and

wife without the benefit of marriage or under a void marriage,

their wages and salaries shall be owned by them in equal shares

and the property acquired by both of them through their work or

industry shall be governed by the rules on co-ownership.

“In the absence of proof to the contrary, properties acquired

while they lived together shall be presumed to have been obtained

by their joint efforts, work or industry, and shall be owned by them

in equal shares. For purposes of this Article, a party who did not

participate in the acquisition by the other party of any property

shall be deemed to have contributed jointly in the acquisition

thereof if the former’s efforts consisted in the care and

maintenance of the family and of the household.

“Neither party can encumber or dispose by acts inter vivos of

his or her share in the property acquired during cohabitation and

owned in common, without the consent of the other, until after the

__________________

5 Rollo, pp. 24-25.

6 See Margaret Maxey vs. Court of Appeals, 129 SCRA 187; Aznar, et al. vs.

Garcia, et al., 102 Phil. 1055.

227 VOL. 260, JULY 31,

1996

227



termination of their cohabitation.

“When only one of the parties to a void marriage is in good

faith, the share of the party in bad faith in the co-ownership shall

be forfeited in favor of their common children. In case of default of

or waiver by any or all of the common children or their

descendants, each vacant share shall belong to the respective

surviving descendants. In the absence of descendants, such share

shall belong to the innocent party. In all cases, the forfeiture shall

take place upon termination of the cohabitation.”

This peculiar kind of co-ownership applies when a man and a

woman, suffering no legal impediment to marry each other,

so exclusively live together as husband and wife under a void

marriage or without the benefit of marriage. The term

“capacitated” in the provision (in the first paragraph of the

law) refers to the legal capacity of a party to contract

marriage, i.e., any “male or female of the age of eighteen

years or upwards not under any of the impediments

mentioned in Articles 37 and 38”7 of the Code.

___________________

7 Art. 5. Any male or female of the age of eighteen years or upwards not

under any of the impediments mentioned in Articles 37 and 38, may contract

marriage.

Art. 37. Marriages between the following are incestuous and void from the

beginning, whether the relationship between the parties be legitimate or

illegitimate:

1. (1)Between ascendants and descendants of any degree; and

2. (2)Between brothers and sisters, whether of the full-or half-blood.

Art. 38. The following marriages shall be void from the beginning for

reasons of public policy:

1. (1)Between collateral blood relatives; whether legitimate or

illegitimate, up to the fourth civil degree;

2. (2)Between step-parents and stepchildren;

3. (3)Between parents-in-law and children-in-law;

4. (4)Between the adopting parent and the adopted child;

5. (5)Between the surviving spouse of the adopting parent and the

adopted child;


33


REPORTS

ANNOTATED



Under this property regime, property acquired by both

spouses through their workand industry shall be governed by

the rules onequal co-ownership. Any property acquired

during the union is prima faciepresumed to have been

obtained through their joint efforts. A party who did not

participate in the acquisition of the property shall still be

considered as having contributed thereto jointly if said

party’s “efforts consisted in the care and maintenance of the

family household.”8Unlike the conjugal partnership of gains,

the fruits of the couple’s separate property are not included

in the co-ownership.

Article 147 of the Family Code, in substance and to the

above extent, has clarified Article 144 of the Civil Code; in

addition, the law now expressly provides that—

(a) Neither party can dispose or encumber by actinter

vivos his or her share in co-ownership property, without the

consent of the other, during the period of cohabitation; and

(b) In the case of a void marriage, any party in bad faith

shall forfeit his or her share in the co-ownership in favor of

their common children; in default thereof or waiver by any or

all of the common children, each vacant share shall belong to

the respective surviving descendants, or still in default

thereof, to the innocent party. The forfeiture shall take place

upon the termination of the cohabitation9 or declaration of

nullity of the marriage.10

When the common-law spouses suffer from a legal

impediment to marry or when they do not live exclusively with

each

__________________

1. (6)Between the surviving spouse of the adopted child and the

adopter;

2. (7)Between an adopted child and a legitimate child of the adopter;

3. (8)Between adopted children of the same adopter; and

4. (9)Between parties where one, with the intention to marry the other,

killed that other person’s spouse or his or her own spouse.

8 Article 147, Family Code.


10 Articles 43, 50 and 51, Family Code.

229 VOL. 260, JULY 31,

1996

229



other (as husband and wife), only the property acquired by

both of them through theiractual joint contribution of money,

property or industry shall be owned in common and

in proportion to their respective contributions. Such

contributions and corresponding shares, however, are prima

faciepresumed to be equal. The share of any party who is

married to another shall accrue to the absolute community or

conjugal partnership, as the case may be, if so existing under

a valid marriage. If the party who has acted in bad faith is

not validly married to another, his or her share shall be

forfeited in the manner already heretofore expressed.11

In deciding to take further cognizance of the issue on the

settlement of the parties’ common property, the trial court

acted neither imprudently nor precipitately; a court which

had jurisdiction to declare the marriage a nullity must be

deemed likewise clothed with authority to resolve incidental

and consequential matters. Nor did it commit a reversible

error in ruling that petitioner and private respondent own





34

the “family home” and all their common property inequal

shares, as well as in concluding that, in the liquidation and

partition of the property owned in common by them, the

provisions on co-ownership under the Civil Code, not Articles

50, 51 and 52, in relation to Articles 102 and 129,12 of the

Family Code,

_______________


12 Art. 50. The effects provided for in paragraph (2), (3), (4) and (5) of

Article 43 and in Article 44 shall also apply in proper cases to marriages

which are declared void ab initio or annulled by final judgment under

Articles 40 and 45.

The final judgment in such cases shall provide for the liquidation,

partition and distribution of the properties of the spouses, the custody and

support of the common children, and the delivery of their presumptive

legitimes, unless such matters had been adjudicated in previous judicial

proceedings.

All creditors of the spouses as well as of the absolute community or the

conjugal partnership shall be notified of the proceedings for liquidation.

In the partition, the conjugal dwelling and the lot on which it is situated,

shall be adjudicated in accordance with the provisions of


REPORTS

ANNOTATED



should aptly prevail. The rules set up to govern the

liquidation of either the absolute community or the conjugal

partnership

__________________

Articles 102 and 129.

Art. 51. In said partition, the value of the presumptive legitimes of all

common children, computed as of the date of the final judgment of the trial

court, shall be delivered in cash, property or sound securities, unless the

parties, by mutual agreement judicially approved, had already provided for

such matters.

The children or their guardian, or the trustee of their property, may ask

for the enforcement of the judgment.

The delivery of the presumptive legitimes herein prescribed shall in no

way prejudice the ultimate successional rights of the children accruing upon

the death of either or both of the parents; but the value of the properties

already received under the decree of annulment or absolute nullity shall be

considered as advances on their legitime.

Art. 52. The judgment of annulment or of absolute nullity of the marriage,

the partition and distribution of the properties of the spouses, and the

delivery of the children’s presumptive legitimes shall be recorded in the

appropriate civil registry and registries of property; otherwise, the same shall

not affect their persons.

Art. 102. Upon dissolution of the absolute community regime, the

following procedure shall apply:

1. (1)An inventory shall be prepared, listing separately all the

properties of the absolute community and the exclusive properties

of each spouse.

2. (2)The debts and obligations of the absolute community shall be paid

out of its assets. In case of insufficiency of said assets, the spouses

shall be solidarily liable for the unpaid balance with their separate

properties in accordance with the provisions of the second

paragraph of Article 94.

3. (3)Whatever remains of the exclusive properties of the spouses shall

thereafter be delivered to each of them.

4. (4)The net remainder of the properties of the absolute community

shall constitute its net assets, which shall be divided equally

between husband and wife, unless a different proportion or division

was agreed upon in the marriage settlements, or unless there has


35

been a voluntary waiver of such share as provided in this Code. For

purposes of computing the net profits subject to forfeiture in

accordance with Article 43, No. (2) and 63, No. (2), the said profits

shall be the increase in

231 VOL. 260, JULY 31,

1996

231



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 co-

ownership

_________________

value between the market value of the community property at the time of

the celebration of the marriage and the market value at the time of its

dissolution.

1. (5)The presumptive legitimes of the common children shall be

delivered upon partition, in accordance with Article 51.

2. (6)Unless otherwise agreed upon by the parties, in the partition of

the properties, the conjugal dwelling and the lot on which it is

situated shall be adjudicated to the spouse with whom the majority

of the common children choose to remain. Children below the age of

seven years are deemed to have chosen the mother, unless the court

has decided otherwise. In case there is no such majority, the court

shall decide, taking into consideration the best interests of said

children.

Art. 129. Upon the dissolution of the conjugal partnership regime, the

following procedure shall apply;


properties of the conjugal partnership and the exclusive properties

of each spouse.

2. (2)Amounts advanced by the conjugal partnership in payment of

personal debts and obligations of either spouse shall be credited to

the conjugal partnership as an asset thereof.

3. (3)Each spouse shall be reimbursed for the use of his or her exclusive

funds in the acquisition of property or for the value of his or her

exclusive property, the ownership of which has been vested by law

in the conjugal partnership.

4. (4)The debts and obligations of the conjugal partnership shall be paid

out of the conjugal assets. In case of insufficiency of said assets, the

spouses shall be solidarily liable for the unpaid balance with their

separate properties, in accordance with the provisions of paragraph

(2) of Article 121.



6. (6)Unless the owner has been indemnified from whatever source, the

loss or deterioration of movables used for the benefit of the family,

belonging to either spouse, even due to fortuitous event, shall be

paid to said spouse from the conjugal


REPORTS

ANNOTATED



that exists between common-law spouses. The first

paragraph of Article 50 of the Family Code, applying

paragraphs (2), (3), (4) and (5) of Article 43,13 relates only, by

its explicit terms, to

________________


36

1. funds, if any.

2. (7)The net remainder of the conjugal partnership properties shall

constitute the profits, which shall be divided equally between

husband and wife, unless a different proportion or division was

agreed upon in the marriage settlements or unless there has been a

voluntary waiver or forfeiture of such share as provided in this

Code.


delivered upon partition in accordance with Article 51.

4. (9)In the partition of the properties, the conjugal dwelling and the lot

on which it is situated shall, unless otherwise agreed upon by the

parties, be adjudicated to the spouse with whom the majority of the

common children choose to remain. Children below the age of seven

years are deemed to have chosen the mother, unless the court has

decided otherwise. In case there is no such majority, the court shall

decide, taking into consideration the best interests of said children.

13 Art. 43. The termination of the subsequent marriage referred to in the

preceding Article shall produce the following effects:

1. (1)The children of the subsequent marriage conceived prior to its

termination shall be considered legitimate, and their custody and

support in case of dispute shall be decided by the court in a proper

proceeding;

2. (2)The absolute community of property or the conjugal partnership,

as the case may be, shall be dissolved and liquidated, but if either

spouse contracted said marriage in bad faith, his or her share of the

net profits of the community property or conjugal partnership

property shall be forfeited in favor of the common children or, if

there are none, the children of the guilty spouse by a previous

marriage or, in default of children, the innocent spouse;

3. (3)Donations by reason of marriage shall remain valid, except that if

the donee contracted the marriage in bad faith, such donations

made to said donee are revoked by operation of law;

4. (4)The innocent spouse may revoke the designation of the other

spouse who acted in bad faith as a beneficiary in any insurance

policy, even if such designation be stipulated as ir-

233 VOL. 260, JULY 31,

1996

233



voidable marriages and, exceptionally, to voidmarriages

under Article 4014of 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. The

latter is a special rule that somehow recognizes the

philosophy and an old doctrine that void marriages are

inexistent from the very beginning and no judicial decree is

necessary to establish their nullity. In now requiring

for purposes of remarriage, the declaration of nullity by final

judgment of the previously contracted void marriage, the

present law aims to do away with any continuing uncertainty

on the status of the second marriage. It is not then illogical

for the provisions of Article 43, in relation to Articles 4115 and

42,16 of the Family

_________________

1. revocable; and

2. (5)The spouse who contracted the subsequent marriage in bad faith

shall be disqualified to inherit from the innocent spouse by testate

and intestate succession.

14 Art. 40. The absolute nullity of a previous marriage may be invoked for

purposes of remarriage on the basis solely of a final judgment declaring such

previous marriage void.




37

15 Art. 41. A marriage contracted by any person during the subsistence of a

previous marriage shall be null and void, unless before the celebration of the

subsequent marriage, the prior spouse had been absent for four consecutive

years and the spouse present had a well-founded belief that the absent

spouse was already dead. In case of disappearance where there is danger of

death under the circumstances set forth in the provisions of Article 391 of the

Civil Code, an absence of only two years shall be sufficient.

For the purpose of contracting the subsequent marriage under the

preceding paragraph, the spouse present must institute a summary

proceeding as provided in this Code for the declaration of presumptive death

of the absentee, without prejudice to the effect of reappearance of the absent

spouse.

16 Art. 42. The subsequent marriage referred to in the preceding Article

shall be automatically terminated by the recording of the affidavit of

reappearance of the absent spouse, unless there is a judgment annulling the

previous marriage or declaring it void ab initio.

A sworn statement of the fact and circumstances of reappearance shall be

recorded in the civil registry of the residence of the


REPORTS

ANNOTATED



Code, on the effects of the termination of a subsequent

marriage contracted during the subsistence of a previous

marriage to be made applicable pro hac vice. In all other

cases, it is not to be assumed that the law has also meant to

have coincident property relations, on the one hand, between

spouses in valid and voidable marriages (before annulment)

and, on the other, between common-law spouses or spouses of

void marriages, leaving to ordain, in the latter case, the

ordinary rules on co-ownership subject to the provision of

Article 147 and Article 148 of the Family Code. It must be

stressed, nevertheless, even as it may merely state the

obvious, that the provisions of the Family Code on the

“family home,” i.e., the provisions found in Title V, Chapter

2, of the Family Code, remain in force and effect regardless of

the property regime of the spouses.

WHEREFORE, the questioned orders, dated 05 May 1995

and 30 October 1995, of the trial court are AFFIRMED. No

costs.

SO ORDERED.

Padilla (Chairman),Kapunan and Hermosisima, Jr.,

JJ., concur.

Bellosillo, J., On leave.

Orders affirmed.

——o0o——

________________

parties to the subsequent marriage at the instance of any interested

person, with due notice to the spouses of the subsequent marriage and

without prejudice to the fact of reappearance being judicially determined in

case such fact is disputed.

38

G.R. No. 111547. January 27, 1997.*

SPS. TRINIDAD S. ESTONINA and PAULINO ESTONINA,

petitioners, vs.COURT OF APPEALS, SPS. CELSO ATAYAN

and NILDA HICBAN and CONSUELO VDA. DE GARCIA,

REMEDIOS, ELVIRA, OFELIA, VIRGILIO, MARILOU, and

LOLITA all surnamed GARCIA, and HEIRS OF CASTOR

GARCIA and of SANTIAGO GARCIA, JR., respondents.

Remedial Law; Appeal;Factual findings of the appellate court

deemed conclusive.—The settled rule is that the factual findings of

the appellate court are deemed conclusive. Thus, the jurisdiction of

this Court in cases brought to it from the Court of Appeals is

generally limited to the review and revision of errors of law

allegedly committed by the appellate court. As such, this Court is

generally not duty-bound to analyze and weigh all over again the

evidence already considered in the proceedings below. This is,

however, subject to several exceptions, one of which is when there

is a conflict between the factual findings of the Court of Appeals

and the trial court, as in this case, warranting a review by this

Court of such factual findings.

Same; Execution; The levy by the sheriff of a property by virtue

of a writ of attachment may be considered as made under the

authority of the court only when the property levied upon belongs to

the defendant.—Being the exclusive property of Santiago Garcia, it

_______________

* THIRD DIVISION.

628

6

28

SUPREME COURT

REPORTS

ANNOTATED

Estonina vs. Court of

Appeals

was the entire parcel of land in question that formed part of

his estate and which passed to his ten heirs by compulsory

succession upon his death. And as correctly held by the Court of

Appeals, what could therefore be attached and sold at public

auction in Civil Case No. 88430 was only the one-tenth (1/10) pro

indiviso share of Consuelo Garcia in the said parcel of land. The

sale at public auction of the disputed property in its entirety by the

Sheriff in favor of Trinidad Estonina over and above the one-tenth

(1/10) share of Consuelo Garcia is null and void, belonging as it

does to the other heirs of Santiago Garcia and later to the spouses

Atayan. Worth reiterating is the basic precept that the power of

the court in the execution of judgments extends only over

properties unquestionably belonging to the judgment debtor. The

levy by the sheriff of a property by virtue of a writ of attachment

may be considered as made under the authority of the court only

when the property levied upon belongs to the defendant. For, as

the sayings goes, one man’s goods shall not be sold for another

man’s debts.

Same; Same; Right of a third-party claimant to file an

independent action to vindicate his claim of ownership over the

properties seized reserved by Section 17, Rule 39 of the Rules of

Court.—The right of a third-party claimant to file an independent

action to vindicate his claim of ownership over the properties

seized is reserved by Section 17, Rule 39 of the Rules of Court.

Same; Same; The “proper action” is and should be an entirely

separate and distinct action from that in which execution has

issued, if instituted by a stranger to the latter suit.—As stated in

the case of Sy v. Discaya, this “proper action” would have for its

object the recovery of ownership or possession of the property

seized by the sheriff, as well as damages resulting from the

allegedly wrongful seizure and detention thereof despite the third

party claim and it may be brought against the sheriff and such

other parties as may be alleged to have colluded with him in the

supposedly wrongful execution proceedings, such as the judgment

creditor himself. Such “proper action,” as above pointed out, is and

should be an entirely separate and distinct action from that in

http://www.central.com.ph/sfsreader/session/0000015080aaf4bf322cb82b000a0094004f00ee/p/AMB914/?username=Guest#p266scra8960627001

39

which execution has issued, if instituted by a stranger to the latter

suit.

Same; Same; The filing by the spouses Atayan of an

independent action with the court other than the one which issued

the writ of execution is proper.—In the case at bench, the filing by

the spouses

629

VOL. 266,

JANUARY 27, 1997

6

29

Estonina vs. Court of

Appeals

Atayan of an independent action with the court other than the

one which issued the writ of execution is proper as they were

strangers to Civil Case No. 88430. Such an independent action

cannot be considered as an encroachment upon the jurisdiction of a

co-equal and coordinate court. While it is true that property in

custody of the law may not be interfered with, without the

permission of the proper court, this rule is confined to cases where

the property belongs to the defendant or one in which the

defendant has proprietary interests. But when the Sheriff, acting

beyond the bounds of his office seizes a stranger’s property, the

rule does not apply and interference with his custody is not

interference with another court’s custody.

Civil Law; Property;Conjugal Partnership; Proof of acquisition

during the marriage is a condition sine qua non for the operation of

the presumption in favor of the conjugal partnership.—The

evidence on record as well as established jurisprudence on the

matter, lead us to concur with the finding of the Court of Appeals

that the property involved in this dispute is indeed the exclusive

property of the deceased Santiago Garcia. It has been repeatedly

held by this Court that the presumption under Article 160 of the

Civil Code that all property of the marriage belong to the conjugal

partnership applies only when there is proof that the property was

acquired during the marriage. Otherwise stated, proof of

acquisition during the marriage is a condition sine qua non for the

operation of the presumption in favor of the conjugal partnership.

In the case at bench, the petitioners have been unable to present

any proof that the property in question was acquired during the

marriage of Santiago and Consuelo. They anchor their claim solely

on the fact that when the title over the land in question was

issued, Santiago was already married to Consuelo as evidenced by

the registration in the name of “Santiago Garcia married to

Consuelo Gaza.” This, according to the spouses Estonina, suffices

to establish the conjugal nature of the property. The foregoing

contention has no merit.

PETITION for review on certiorari of a decision of the Court

of Appeals.

The facts are stated in the resolution of the Court.

Diosdado N. Silva for petitioners.

Leopoldo N. Consunto, Jr. for respondent spouses

Atayan and Nilda Hicban.


REPORTS

ANNOTATED

Estonina vs. Court of Appeals

Balagtas P. Ilagan for respondents Garcia, et al.

R E S O L U T I O N

FRANCISCO, J.:

The instant controversy involves Lot C of the amended plan

Psu-22983 Amd., situated in Barrio Santisima Cruz, Sta.

Cruz, Laguna with an area of 273 square meters. The said

parcel of land was covered by Transfer Certificate of Title No.

T-19175 issued in the name of Santiago Garcia who died on

October 2, 1967. Some six years after Santiago Garcia’s

death, or on March 10, 1973, the then Court of First Instance

40

of Manila issued an order granting Trinidad Estonina’s

application for a writ of preliminary attachment in Civil Case

No. 88430 entitled “Trinidad Estonina, et al., plaintiffs -

versus Consuelo Garcia, et al., defendants.” Consequently, a

notice of attachment was inscribed as a memorandum of

encumbrance at the back of TCT No.T-19175 in favor of

Trinidad Estonina covering all the rights, title, interest, and

participation that Consuelo Garcia, the widow of Santiago

Garcia, may have in and to the parcel of land covered by the

said title.

As a result of a prior sale made by Santiago Garcia to

Anselmo Balasoto of a sixty square meter portion of the said

parcel of land, TCT No. T-19175 was cancelled and in lieu

thereof, TCT No. 77215 was issued on July 25, 1975 in the

name of Santiago Garcia covering the remaining 213 square

meters. TCT No. 77215 was in turn cancelled on June 27,

1977 because of another sale purportedly made during his

lifetime by Santiago Garcia to his wife’s niece, Ofelia Garcia,

and TCT No. 82229 was issued in the name of the latter.

On August 14, 1977, the children of Santiago Garcia with

his first wife, Adela Isoreta, namely Ofelia, Remedios, Elvira

and Castor, all surnamed Garcia, executed a deed selling,

transferring and conveying unto the spouses Celso Atayan

and Nilda Hicban (hereinafter referred to as the spouses

Atayan for brevity) their “title, rights, interest and

participation which is four tenths (4/10) pro indivisoshare” in

the said

631 VOL. 266, JANUARY

27, 1997

631


parcel of land covered by TCT No. T-82229. About a year

after, Santiago Garcia’s second wife and widow, Consuelo

Garcia and their children, Virgilio, Marilou and Lolita, all

surnamed Garcia, followed suit and also sold to the spouses

Atayan, their four-tenths (4/10) pro indiviso share in the

same parcel of land. On February 22, 1980, Estrella R.

Garcia, the widow of Santiago Garcia, Jr. (Santiago Garcia’s

son from his first marriage), and their children, Roderick,

Elizabeth, Dorothy and Erlinda, likewise sold to the spouses

Atayan, their onetenth (1/10) pro indivisoshare in the parcel

of land covered by TCT No. T-82229.1

Subsequent to a favorable decision obtained by Trinidad

Estonina in Civil Case No. 88430 against Consuelo Garcia,

execution pending appeal was made on the parcel of land

formerly covered by TCT No. T-19175 (now covered by TCT

No. T-82229) on July 20, 1979. The said parcel of land was

sold at a public auction where Trinidad Estonina was the

highest bidder. Consuelo Garcia appealed the decision in

Civil Case No. 88430 before the then Intermediate Appellate

Court which, however, ruled in favor of Trinidad Estonina.

Thus, on February 29, 1984, the Intermediate Appellate

Court rendered a decision declaring “owner’s copy of

Certificate of Title No. T-82229 a NULLITY and/or

CANCELLED.” Upon the finality of the said decision, TCT

No. T-82229 was cancelled by the Register of Deeds of

Laguna and in lieu thereof, TCT No. T-99961 was issued in

favor of “Trinidad Estonina married to Paulino Estonina.”2

On July 25, 1985, the spouses Atayan filed a complaint for

annulment of sheriff’s sale and transfer certificate of title

with damages before Branch 28 of the Regional Trial Court

(RTC) of Santa Cruz, Laguna, impleading as defendants

therein the spouses Trinidad and Paulino Estonina

(hereinafter referred to as the spouses Estonina for brevity),

Nicanor E. Silvano, Reynaldo G. Javier, Edmund R. Solidum,

the

_______________

1 DECISION in CA-G.R. CV No. 28276, pp. 1-3; Rollo, pp. 2426.



41

2 PETITION in G.R. No. 111547, p. 4; Rollo, p. 10.


REPORTS

ANNOTATED


Register of Deeds of Laguna, and the heirs of Santiago

Garcia who sold to the spouses Atayan their pro

indiviso shares in the parcel of land covered by TCT No. T-

82229. The complaint prayed:

“that the sale at public auction of the parcel of land covered by

TCT No. 77215 x x x and the Sheriff’s final deed x x x be declared

null and void; that the Register of Deeds be ordered to cancel TCT

No. T-99961 in the name of Trinidad S. Estonina married to

Paulino Estonina x x x; that the plaintiffs be declared owners of

nine-tenths (9/10) pro indivisointerests, shares and participation

in the parcel of land covered by TCT No. T-77215, x x x, and the

Register of Deeds ordered to issue a new certificate of title

corresponding thereto; and that the defendants Nicanor E. Silvano,

Reynaldo G. Javier and Edmund R. Solidum be ordered to pay,

jointly and severally, the plaintiffs spouses and (sic) amount of

P30,000 for attorney’s fees, P15,000 for litigation expenses

incurred, P20,000 for moral damages and P15,000 for exemplary

damages x x x.”3

In their amended answer to the plaintiff’s complaint, the

spouses Estonina claimed that:

“the plaintiffs (spouses Atayan) had acted in bad faith in allegedly

purchasing the parcel of land, they being aware that it was the

subject of a lawful and valid attachment; that there was no valid

extrajudicial settlement of agreement executed by the heirs of

Santiago Garcia by which their rights could have been adjusted

and settled before doing anything with his property; that the deeds

of sale executed by his heirs were anomalous, fictitious and

simulated intended to defeat the adverse judgment rendered by

the Court against them and the writ of attachment issued

pursuant thereto as they were derived from a falsified deed of sale

purportedly executed by Santiago Garcia on June 23, 1967; that

the property in question is presumed to be conjugal answerable for

obligations and liabilities of the conjugal partnership incurred

during the existence of the partnership; and that the plaintiffs

were guilty of laches (pp. 90-99, rec.).”4

_______________

3 Supra, p. 5; Rollo, p. 28.

4 Ibid.


27, 1997

633


After trial, the RTC rendered a decision dismissing the

complaint for lack of merit. It found, among others, that the

property covered by TCT No. T-19175 and now covered by

TCT No. T-82229, was acquired during the marriage of

Santiago Garcia and Consuelo Gaza, and is presumed to be

conjugal in nature. Upon the death of Santiago Garcia on

October 2, 1967, his conjugal share of one-half (1/2) of the

said parcel of land was transmitted to his heirs by intestate

succession. By the law on intestate succession, his nine

children, five by his first wife and four out of the subsequent

marriage, and Consuelo Garcia, his second wife and widow,

inherited the same at one-tenth (1/10) eachpro indiviso. The

remaining one-half (1/2) pertained to the conjugal share of

Consuelo Garcia. Thus, inasmuch as Consuelo Garcia

inherited one-tenth (1/10) of her husband’s conjugal share in

the said property and is the owner of one-half (1/2) thereof as

her conjugal share, she owns a total of 55% (or 1/10 plus 1/2)

of the said parcel of land.5 Finding as such, the RTC held that

what could be attached by the spouses Estonina and later

levied on execution and sold at public auction was only




42

Consuelo Garcia’s rights and interests which is fifty five per

cent (55%) of the property. Thus, the RTC ordered the

Register of Deeds of the Province of Laguna, to cancel

Transfer Certificate of Title No. T-99961 in the name of

TRINIDAD S. ESTONINA, married to Paulino Estonina, and

issue another one, also in her name, married to the same

person, stating therein that said person is the owner of the

property therein covered to the extent of 55%pro indiviso,

and the remaining 45% belongs to the heirs of Santiago

Garcia pro indiviso.6

Both the spouses Atayan and the heirs of Santiago Garcia

appealed to the herein public respondent Court of Appeals.

After a thorough review of the evidence on record, the Court

of Appeals concluded that contrary to the finding of the RTC,

the parcel of land in question was not the conjugal property

of Santiago and Consuelo Garcia, but was the former’s

exclusive

_______________




REPORTS

ANNOTATED


property. It was therefore the entire property that formed

part of Santiago Garcia’s estate upon his death. When

Santiago Garcia died, his nine children and Consuelo Garcia

inherited the said property each to the extent of one/tenth

(1/10) pro indivisoshare. Hence, it was only Consuelo Garcia’s

one tenth (1/10) pro indiviso share in the parcel of land in

question which could be validly attached, levied and sold in

execution to satisfy the judgment against her and in favor of

Trinidad Estonina in Civil Case No. 88430. On August 12,

1993, the Court of Appeals rendered a decision, the

dispositive portion of which reads as follows:

“WHEREFORE, the judgment appealed from is REVERSED and

SET ASIDE. Accordingly, Transfer Certificate of Title No. T99961,

covering Lot 2-C (LRC) Psd 223486, situated in Sta. Cruz, Laguna

issued in the name of Trinidad S. Estonina, married to Paulino

Estonina x x x, is hereby ordered cancelled and nullified and the

Register of Deeds of Laguna ordered to issue another in lieu

thereof covering the same parcel of land in the name of Trinidad S.

Estonina, widow, one-tenth (1/10) pro indiviso share, and spouses

Celso Atayan and Nilda Hicban, nine-tenths (9/10) pro

indiviso share.”7

Aggrieved, the spouses Estonina filed this petition and raised

the following issues:

I.

The Court of Appeals, in declaring the property in question as

exclusive property of Santiago Garcia, DISREGARDED the long

established doctrine that the trial court’s findings especially as to

the credibility of the witnesses should be respected.

II.

The Court of Appeals, in issuing the questioned decision, solely

centered on the nature of the property in question, and

conveniently brushed aside the following legal issues raised on

appeal (thereby leading to an erroneous judgment), to wit:

_______________

7 Ibid., p. 15; Rollo, p. 38.


27, 1997

635



43


1. (a)That the plaintiffs-appellants (Sps. Atayan and now

private respondents) have no cause of action and/or lack of

cause of action against Estoninas (now petitioners).

Assuming, arguendo that they have, the same is now

barred by laches. The same is true with the appellants

Garcias (now also private respondents). Hence, the title of

Estonina should have been declared valid.

2. (b)That the plaintiffs-appellants (Sps. Atayan and now

private respondents) are not parties to Civil Case No.

88430 where the writ of attachment was issued and which

resulted in the execution pending appeal. Hence, they

cannot attack the validity of the execution in this

proceedings especially so when judgment therein had

already attained finality.

III.

Consequently, by virtue of the foregoing errors, the Court of

Appeals erred in not granting herein petitioners’ prayer that the

trial court’s findings be modified by upholding Estonina’s title to

the property under TCT No. T-99961, and affirming in all other

respect the order of the trial court.8

The settled rule is that the factual findings of the appellate

court are deemed conclusive.9 Thus, the jurisdiction of this

Court in cases brought to it from the Court of Appeals is

generally limited to the review and revision of errors of law

allegedly committed by the appellate court. As such, this

Court is generally not duty-bound to analyze and weigh all

over again the evidence already considered in the

proceedings below.10 This is, however, subject to several

exceptions, one of which is when there is a conflict between

the factual findings

_______________

8 Supra, pp. 8-9; Rollo, pp. 14-15.

9 Industrial Textile Manufacturing Company of the Philippines vs. LPJ

Enterprises, Inc., 217 SCRA 322, 325 [1993]; Guinsatao vs. Court of

Appeals, 218 SCRA 708 [1993];Bustamante vs. Court of Appeals, 193 SCRA

603 [1991]; Radiowealth Finance Company vs. Palileo, 197 SCRA 245 [1991].

10 Gaw vs. Intermediate Appellate Court, 220 SCRA 405, 413 [1993].


REPORTS

ANNOTATED


of the Court of Appeals and the trial court, as in this case,

warranting a review by this Court of such factual findings.11

In concluding that the parcel of land in question was the

conjugal property of Santiago and Consuelo Garcia, the trial

court relied solely on the fact that when TCT No. T-19175

covering the said land was issued, Santiago Garcia was

already married to Consuelo Garcia, thus giving rise to the

presumption that the same was indeed conjugal. It found the

testimony of Consuelo Garcia that the said property was

inherited by Santiago Garcia from his deceased mother to be

self-serving and completely disregarded the said testimony.

And as regards the inscription at the back of the TCT No.

T19175 that:

“[t]he property described in this title is subject to the claims of the

heirs of the deceased Eugenia Clemente, within two (2) years from

January 27, 1961, in accordance with the provision of Section 4,

Rule 74 of the Rules of Court,”12

the trial court held that “there is no showing at all from said

inscription that said property came from the parents of

Santiago Garcia.”13

On the other hand, the Court of Appeals in taking the

stance that the said land was the exclusive property of







44

Santiago Garcia, gave credence to the unrebutted testimony

of Consuelo Garcia that the said parcel of land was inherited

by Santiago Garcia from his deceased mother Eugenia

Clemente and that it used to be part of a big tract of land

which was divided among Santiago and his sisters.

The evidence on record as well as established

jurisprudence on the matter, lead us to concur with the

finding of the Court of Appeals that the property involved in

this dispute is indeed the exclusive property of the deceased

Santiago Garcia. It has been repeatedly held by this Court

that the presumption

______________

11 Ibid.

12 Supra, 10; Rollo, p. 33.

13 Ibid.


27, 1997

637


under Article 160 of the Civil Code that all property of the

marriage belong to the conjugal partnership applies only

when there is proof that the property was acquired during

the marriage. Otherwise stated, proof of acquisition during

the marriage is a condition sine qua non for the operation of

the presumption in favor of the conjugal partnership.14 In the

case at bench, the petitioners have been unable to present

any proof that the property in question was acquired during

the marriage of Santiago and Consuelo. They anchor their

claim solely on the fact that when the title over the land in

question was issued, Santiago was already married to

Consuelo as evidenced by the registration in the name of

“Santiago Garcia married to Consuelo Gaza.” This, according

to the spouses Estonina, suffices to establish the conjugal

nature of the property. The foregoing contention has no

merit. In the case of Jocson v. Court of Appeals15 we held that:

“The certificates of title, however, upon which petitioner rests his

claim is insufficient. The fact that the properties were registered in

the name of ‘Emilio Jocson, married to Alejandra Poblete’ is no

proof that the properties were acquired during the spouses’

coverture. Acquisition of title and registration thereof are two

different acts. It is well settled that registration does not confer

title but merely confirms one already existing x x x. It may be that

the properties under dispute were acquired by Emilio Jocson when

he was still a bachelor but were registered only after his marriage

to Alejandra Poblete, which explains why he was described in the

certificates of title as married to the latter.

“Contrary to petitioner’s position, the certificates of title show,

on their face, that the properties were exclusively Emilio Jocson’s,

the registered owner. This is so because the words ‘married to’

preceding ‘Alejandra Poblete’ are merely descriptive of the civil

status of Emilio Jocson x x x. In other words, the import from the

certificates of title is that Emilio Jocson is the owner of the proper-

_______________

14 Jocson vs. Court of Appeals, 170 SCRA 333, 344 [1989]; Ong vs. Court of

Appeals, 204 SCRA 297, 302 [1989];Cobb-Perez vs. Hon. Gregorio Lantin, 23

SCRA 637 [1968]; Maramba vs. Lozano, et al., 20 SCRA 474 [1967].

15 Ibid.


REPORTS

ANNOTATED


ties, the same having been registered in his name alone, and that

he is married to Alejandra Poblete.”16

Being the exclusive property of Santiago Garcia, it was the

entire parcel of land in question that formed part of his




45

estate and which passed to his ten heirs by compulsory

succession upon his death. And as correctly held by the Court

of Appeals, what could therefore be attached and sold at

public auction in Civil Case No. 88430 was only the one-tenth

(1/10) pro indiviso share of Consuelo Garcia in the said parcel

of land. The sale at public auction of the disputed property in

its entirety by the Sheriff in favor of Trinidad Estonina over

and above the one-tenth (1/10) share of Consuelo Garcia is

null and void, belonging as it does to the other heirs of

Santiago Garcia and later to the spouses Atayan. Worth

reiterating is the basic precept that the power of the court in

the execution of judgments extends only over properties

unquestionably belonging to the judgment debtor. The levy

by the sheriff of a property by virtue of a writ of attachment

may be considered as made under the authority of the court

only when the property levied upon belongs to the

defendant.17 For, as the saying goes, one man’s goods shall not

be sold for another man’s debts.18

The right of a third-party claimant to file an independent

action to vindicate his claim of ownership over the properties

seized is reserved by Section 17, Rule 39 of the Rules of

Court:

“SEC. 17. Proceedings where property claimed by third person.—If

property levied on be claimed by any other person than the

judgment debtor or his agent, and such person make an affidavit of

his title thereto or his right to the possession thereof, stating the

grounds of his right or title, and serve the same upon the officer

_______________

16 Ibid., p. 345.

17 Uy, Jr. vs. Court of Appeals, 191 SCRA 275, 281 [1990]; Consolidated Bank

and Trust Corp. vs. Court of Appeals, 193 SCRA 158 [1991]; Ong vs. Tating, 149

SCRA 265 [1987]; Traders Royal Bank vs. IAC, 133 SCRA 141[1984].

18 Ong vs. Tating, ibid., p. 275.


27, 1997

639


making the levy, and a copy thereof upon the judgment creditor,

the officer shall not be bound to keep the property, unless such

judgment creditor or his agent, on demand of the officer, indemnify

the officer against such claim by a bond in a sum not greater than

the value of the property levied on. In case of disagreement as to

such value, the same shall be determined by the court issuing the

writ of execution.

“The officer is not liable for damages, for the taking or the

keeping of the property, to any third-party claimant unless a claim

is made by the latter and unless an action for damages is brought

by him against the officer within one hundred twenty (120) days

from the date of the filing of the bond. But nothing herein

contained shall prevent such claimant or any third person from

vindicating his claim to the property by any other proper action.

“x x x x x x x x x.” (Italics supplied.)

As stated in the case of Sy v. Discaya,19 this “proper action”

would have for its object the recovery of ownership or

possession of the property seized by the sheriff, as well as

damages resulting from the allegedly wrongful seizure and

detention thereof despite the third party claim and it may be

brought against the sheriff and such other parties as may be

alleged to have colluded with him in the supposedly wrongful

execution proceedings, such as the judgment creditor himself.

Such “proper action,” as above pointed out, is and should be

an entirely separate and distinct action from that in which

execution has issued, if instituted by a stranger to the latter

suit.20

In the case at bench, the filing by the spouses Atayan of

an independent action with the court other than the one

which issued the writ of execution is proper as they were

strangers to Civil Case No. 88430. Such an independent





46

action cannot be considered as an encroachment upon the

jurisdiction of a coequal and coordinate court.21 While it is

true that property in custody of the law may not be interfered

with, without the

_______________

19 181 SCRA 378 [1990].

20 Ibid., p. 383.

21 Ibid., p. 384; Uy, Jr. vs. Court of Appeals, supra, p. 281.


REPORTS

ANNOTATED


permission of the proper court, this rule is confined to cases

where the property belongs to the defendant or one in which

the defendant has proprietary interests. But when the

Sheriff, acting beyond the bounds of his office seizes a

stranger’s property, the rule does not apply and interference

with his custody is not interference with another court’s

custody.22

The foregoing puts to rest any and all questions raised

regarding the propriety of the course of action taken by the

spouses Atayan in vindication of their claim over the land in

question. Anent the contention that the spouses Atayan are

guilty of laches, suffice it to state that this residual argument

deserves scant consideration. Being strangers to Civil Case

No. 88430 where the writ of execution over the land in

question was issued, they cannot be faulted for filing the

“proper action” only in 1985 or six (6) years after the levy on

execution. Besides, it was only in 1984 that the Court of

Appeals rendered a decision finally cancelling the title of

their predecessors-in-interest and issuing another one in

favor of Trinidad Estonina. The action filed by the spouses

Atayan seeking the annulment of the sheriff’s sale and the

transfer certificate of title with damages immediately

thereafter or on July 25, 1985 cannot be considered as undue

delay nor does it imply a lack of interest to enforce their

claim over the disputed property.

WHEREFORE, the petition is DENIED and the assailed

decision of the Court of Appeals is affirmed in toto.

SO ORDERED.

Narvasa (C.J., Chairman), Davide,

Jr., Meloand Panganiban, JJ., concur.

Petition denied, judgment affirmed in toto.

Note.—All property of the marriage is presumed to belong

to the conjugal partnership unless it be proved that it

pertains exclusively to the husband or to the wife. (Salvador

vs. Court of Appeals, 243 SCRA 239[1995])

——o0o——



47

G.R. No. 118305. February 12, 1998.*

AYALA INVESTMENT & DEVELOPMENT CORP. and

ABELARDO MAGSAJO, petitioners, vs. COURT OF AP-

PEALS and SPOUSES ALFREDO & ENCARNACION

CHING, respondents.

Civil Law; Family Code;Conjugal Partnerships; Where the

husband contracts obligations on behalf of the family business, the

law presumes, and rightly so, that such obligation will redound to

the benefit of the conjugal partnership.—If the husband himself is

the principal obligor in the contract, i.e., he directly received the

money and services to be used in or for his own business or his own

profession, that contract falls within the term “x x x x obligations

for the benefit of the conjugal partnership.” Here, no actual benefit

may be proved. It is enough that the benefit to the family is

apparent at the time of the signing of the contract. From the very

nature of the contract of loan or services, the family stands to

benefit from the loan facility or services to be rendered to the

business or profession of the husband. It is immaterial, if in the

end, his business or profession fails or does not succeed. Simply

stated, where the husband contracts obligations on behalf of the

family business, the law presumes, and rightly so, that such

obligation will redound to the benefit of the conjugal partnership.

Same; Same; Same; If the money or services are given to

another person or entity and the husband acted only as a surety or

guarantor, that contract cannot, by itself, alone be categorized as

falling within the context of “obligations for the benefit of the

conjugal partnership.”—On the other hand, if the money or

services are given to another person or entity, and the husband

acted only as a surety orguarantor, that contract cannot, by itself,

alone be categorized as falling within the context of “obligations for

the benefit of the conjugal partnership.” The contract of loan or

services is clearly for the benefit of the principal debtor and not for

the surety or his family. No presumption can be inferred that,

when a husband enters into a contract of surety or accommodation

agreement, it is “for the benefit of the conjugal partnership.” Proof

must be presented to establish benefit redounding to the conjugal

partnership.

Same; Same; Same; The burden of proof that the debt was

contracted for the benefit of the conjugal partnership of gains, lies

with the creditor-party litigant claiming as such.—The burden of

proof that the debt was contracted for the benefit of the conjugal

partnership of gains, lies with the creditor-party litigant claiming

as such. In the case at bar, respondent-appellant AIDC failed to

prove that the debt was contracted by appellee-husband, for the

benefit of the conjugal partnership of gains. What is apparent from

the facts of the case is that the judgment debt was contracted by or

in the name of the Corporation Philippine Blooming Mills and

appellee-husband only signed as surety thereof. The debt is clearly

a corporate debt and respondent-appellant’s right of recourse

against appellee-husband as surety is only to the extent of his

corporate stockholdings. It does not extend to the conjugal

partnership of gains of the family of petitioners-appellees.

Same; Same; Same; Signing as a surety is certainly not an

exercise of an industry or profession.—“Signing as a surety is

certainly not an exercise of an industry or profession, hence the

cited cases of Cobb-Perez vs. Lantin; Abella de Diaz vs. Erlanger &

Galinger; G-Tractors, Inc. vs. CA do not apply in the instant case.

Signing as a surety is not embarking in a business.”

Same; Same; Same; Payment of personal debts contracted by

the husband or the wife before or during the marriage shall not be

charged to the conjugal partnership except to the extent that they

redounded to the benefit of the family.—Article 121, paragraph 3, of

the Family Code is emphatic that the payment of personal debts

contracted by the husband or the wife before or during the

marriage shall not be charged to the conjugal partnership except to

the extent that they redounded to the benefit of the family.


of Appeals.

http://www.central.com.ph/sfsreader/session/0000015080b3d93398b68a8b000a0094004f00ee/p/AJV758/?username=Guest#p286scra8960272002

48


Acosta and Corvera Law Offices for petitioners.

Quiason, Makalintal,Barot, Torres & Ibarra for private

respondents.

MARTINEZ, J.:

Under Article 161 of the Civil Code, what debts and

obligations contracted by the husband alone are considered

“for the benefit of the conjugal partnership” which are

chargeable against the conjugal partnership? Is a surety

agreement or an accommodation contract entered into by the

husband in favor of his employer within the contemplation of

the said provision?

These are the issues which we will resolve in this petition

for review.


12, 1998

275

Ayala Investment &

Development Corp. vs. Court

of Appeals

The petitioner assails the decision dated April 14, 1994 of the

respondent Court of Appeals in “Spouses Alfredo and

Encarnacion Ching vs. Ayala Investment and Development

Corporation, et al.,” docketed as CA-G.R. CV No.

29632,1 upholding the decision of the Regional Trial Court of

Pasig, Branch 168, which ruled that the conjugal partnership

of gains of respondents-spouses Alfredo and Encarnacion

Ching is not liable for the payment of the debts secured by

respondent-husband Alfredo Ching.

A chronology of the essential antecedent facts is necessary

for a clear understanding of the case at bar.

Philippine Blooming Mills (hereinafter referred to as

PBM) obtained a P50,300,000.00 loan from petitioner Ayala

Investment and Development Corporation (hereinafter

referred to as AIDC). As added security for the credit line

extended to PBM, respondent Alfredo Ching, Executive Vice

President of PBM, executed security agreements on

December 10, 1980 and on March 20, 1981 making himself

jointly and severally answerable with PBM’s indebtedness to

AIDC.

PBM failed to pay the loan. Thus, on July 30, 1981, AIDC

filed a case for sum of money against PBM and respondent-

husband Alfredo Ching with the then Court of First Instance

of Rizal (Pasig), Branch VIII, entitled “Ayala Investment and

Development Corporation vs. Philippine Blooming Mills and

Alfredo Ching,” docketed as Civil Case No. 42228.

After trial, the court rendered judgment ordering PBM

and respondent-husband Alfredo Ching to jointly and

severally pay AIDC the principal amount of P50,300,000.00

with interests.

Pending appeal of the judgment in Civil Case No. 42228,

upon motion of AIDC, the lower court issued a writ of

execution pending appeal. Upon AIDC’s putting up of an

_______________

1 Penned by Hon. Associate Justice Asaali S. Isnani and concurred in by

Associate Justices Nathanael P. de Pano, Jr. and Co-rona Ibay-Somera,

Former Fourth Division, Decision, pp. 34-39, Rollo.


REPORTS

ANNOTATED

Ayala Investment &


of Appeals

P8,000,000.00 bond, a writ of execution dated May 12, 1982

was issued. Thereafter, petitioner Abelardo Magsajo, Sr.,


49

Deputy Sheriff of Rizal and appointed sheriff in Civil Case

No. 42228, caused the issuance and service upon

respondents-spouses of a notice of sheriff sale dated May 20,

1982 on three (3) of their conjugal properties. Petitioner

Magsajo then scheduled the auction sale of the properties

levied.

On June 9, 1982, private respondents filed a case of

injunction against petitioners with the then Court of First

Instance of Rizal (Pasig), Branch XIII, to enjoin the auction

sale alleging that petitioners cannot enforce the judgment

against the conjugal partnership levied on the ground that,

among others, the subject loan did not redound to the benefit

of the said conjugal partnership.2 Upon application of private

respondents, the lower court issued a temporary restraining

order to prevent petitioner Magsajo from proceeding with the

enforcement of the writ of execution and with the sale of the

said properties at public auction.

AIDC filed a petition for certiorari before the Court of

Appeals,3 questioning the order of the lower court enjoining

the sale. Respondent Court of Appeals issued a Temporary

Restraining Order on June 25, 1982, enjoining the lower

court4 from enforcing its Order of June 14, 1982, thus paving

the way for the scheduled auction sale of respondents-

spouses conjugal properties.

On June 25, 1982, the auction sale took place. AIDC being

the only bidder, was issued a Certificate of Sale by petitioner

Magsajo, which was registered on July 2, 1982. Upon

expiration of the redemption period, petitioner sheriff issued

the final deed of sale on August 4, 1982 which was registered

on August 9, 1983.

In the meantime, the respondent court, on August 4, 1982,

decided CA-G.R. SP No. 14404, in this manner:

_______________

2 Annex “C,” petition; pp. 43-52, rollo.

3 CA-G.R. No. SP-14404.

4 Branch VIII, CFI of Rizal.


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of Appeals

“WHEREFORE, the petition for certiorari in this case is granted

and the challenged order of the respondent Judge dated June 14,

1982 in Civil Case No. 46309 is hereby set aside and nullified. The

same petition insofar as it seeks to enjoin the respondent Judge

from proceeding with Civil Case No. 46309 is, however, denied. No

pronouncement is here made as to costs. x x x x.”5

On September 3, 1983, AIDC filed a motion to dismiss the

petition for injunction filed before Branch XIII of the CFI of

Rizal (Pasig) on the ground that the same had become moot

and academic with the consummation of the sale.

Respondents filed their opposition to the motion arguing,

among others, that where a third party who claims

ownership of the property attached or levied upon, a different

legal situation is presented; and that in this case, two (2) of

the real properties are actually in the name of Encarnacion

Ching, a non-party to Civil Case No. 42228.

The lower court denied the motion to dismiss. Hence, trial

on the merits proceeded. Private respondents presented

several witnesses. On the other hand, petitioners did not

present any evidence.

On September 18, 1991, the trial court promulgated its

decision declaring the sale on execution null and void.

Petitioners appealed to the respondent court, which was

docketed as CA-G.R. CV No. 29632.





50

On April 14, 1994, the respondent court promulgated the

assailed decision, affirming the decision of the regional trial

court. It held that:

“The loan procured from respondent-appellant AIDC was for the

advancement and benefit of Philippine Blooming Mills and not for

the benefit of the conjugal partnership of petitioners-appellees.

x x x x x x x x x

As to the applicable law, whether it is Article 161 of the New

Civil Code or Article 1211 of the Family Code-suffice it to say that

_______________

5 Pars. 4, 5, dispositive portion of the Decision in CA-G.R. No. SP-14404; p. 36,

rollo.


REPORTS

ANNOTATED

Ayala Investment &


of Appeals

the two provisions are substantially the same. Nevertheless, We

agree with the trial court that the Family Code is the applicable

law on the matter x x x x x x.

Article 121 of the Family Code provides that ‘The conjugal

partnership shall be liable for: x x x (2) All debts and obligations

contracted during the marriage by the designated Administrator-

Spouse for the benefit of the conjugal partnership of gains x x x.’

The burden of proof that the debt was contracted for the benefit of

the conjugal partnership of gains, lies with the creditor-party

litigant claiming as such. In the case at bar, respondent-appellant

AIDC failed to prove that the debt was contracted by appellee-

husband, for the benefit of the conjugal partnership of gains.”

The dispositive portion of the decision reads:

“WHEREFORE, in view of all the foregoing, judgment is hereby

rendered DISMISSING the appeal. The decision of the Regional

Trial Court is AFFIRMED in toto.”6

Petitioner filed a Motion for Reconsideration which was

denied by the respondent court in a Resolution dated

November 28, 1994.7

Hence, this petition for review. Petitioner contends that

the “respondent court erred in ruling that the conjugal

partnership of private respondents is not liable for the

obligation by the respondent-husband.”

Specifically, the errors allegedly committed by the

respondent court are as follows:

1. “I.RESPONDENT COURT ERRED IN RULING THAT

THE OBLIGATION INCURRED BY RESPONDENT

HUSBAND DID NOT REDOUND TO THE BENEFIT OF

THE CONJUGAL PARTNERSHIP OF THE PRIVATE

RESPONDENT.

2. II.RESPONDENT COURT ERRED IN RULING THAT

THE ACT OF RESPONDENT HUSBAND IN SECURING

THE SUBJECT

_______________

6 Decision in CA-G.R. CV No. 29632; p. 39, rollo.

7 See p. 41, rollo.


12, 1998

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of Appeals

LOAN IS NOT PART OF HIS INDUSTRY, BUSINESS OR

CAREER FROM WHICH HE SUPPORTS HIS FAMILY.”



51

Petitioners in their appeal point out that there is no need

to prove that actual benefit redounded to the benefit of the

partnership; all that is necessary, they say, is that the

transaction was entered into for the benefit of the conjugal

partnership. Thus, petitioners aver that:

“The wordings of Article 161 of the Civil Code is very clear: for the

partnership to be held liable, the husband must have contracted

the debt ‘for the benefit of’ the partnership, thus:

‘Art. 161. The conjugal partnership shall be liable for:

1) all debts and obligations contracted by the husband for the benefit

of the conjugal partnership x x x.’

There is a difference between the phrases: ‘redounded to the

benefit of’ or ‘benefited from’ (on the one hand) and ‘for the benefit

of’ (on the other). The former require that actual benefit must have

been realized; the latter requires only that the transaction should

be one which normally would produce benefit to the partnership,

regardless of whether or not actual benefit accrued.”8

We do not agree with petitioners that there is a difference

between the terms “redounded to the benefit of” or “benefited

from” on the one hand; and “for the benefit of” on the other.

They mean one and the same thing. Article 161(1) of the Civil

Code and Article 121(2) of the Family Code are similarly

worded,i.e., both use the term “for the benefit of.” On the

other hand, Article 122 of the Family Code provides that

“The payment of personal debts by the husband or the wife

before or during the marriage shall not be charged to the

conjugal partnership except insofar as they redounded to the

benefit of the family.” As can be seen, the terms are used

interchangeably.

Petitioners further contend that the ruling of the

respondent court runs counter to the pronouncement of this

Court in

_______________

8 See p. 18, pars. 3-6, rollo.


REPORTS

ANNOTATED

Ayala Investment &


of Appeals

the case of Cobb-Perez vs. Lantin,9 that the husband as head

of the family and as administrator of the conjugal

partnership is presumed to have contracted obligations for

the benefit of the family or the conjugal partnership.

Contrary to the contention of the petitioners, the case of

Cobb-Perez is not applicable in the case at bar. This Court

has, on several instances, interpreted the term “for the

benefit of the conjugal partnership.”

In the cases of Javier vs. Osmeña,10 Abella de Diaz vs.

Erlanger & Galinger, Inc.,11Cobb-Perez vs. Lantin12 and G-

Tractors, Inc. vs. Court of Appeals,13 cited by the petitioners,

we held that:

“The debts contracted by the husband during the marriage

relation, for and in the exercise of the industry or profession by

which he contributes toward the support of his family, are not his

personal and private debts, and the products or income from the

wife’s own property, which, like those of her husband’s, are liable

for the payment of the marriage expenses, cannot be excepted from

the payment of such debts.” (Javier)

“The husband, as the manager of the partnership (Article 1412,

Civil Code), has a right to embark the partnership in an ordinary

commercial enterprise for gain, and the fact that the wife may not

approve of a venture does not make it a private and personal one of

the husband.” (Abella de Diaz)

“Debts contracted by the husband for and in the exercise of the

industry or profession by which he contributes to the support of







52

the family, cannot be deemed to be his exclusive and private

debts.” (Cobb-Perez)

“x x x if he incurs an indebtedness in the legitimate pursuit of

his career or profession or suffers losses in a legitimate business,

the conjugal partnership must equally bear the indebtedness and

the

_______________

9 No. L-22320, May 22, 1968, 23 SCRA 637; 645.

10 No. 9984, March 23, 1916, 34 Phil. 336.

11 No. 38052, December 23, 1933, 59 Phil. 326.

12 No. L-22320, May 23, 1968, supra.

13 No. L-57402, February 28, 1995, 135 SCRA 193.


12, 1998

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of Appeals

losses, unless he deliberately acted to the prejudice of his family.”

(G-Tractors)

However, in the cases ofAnsaldo vs. Sheriff of Manila,

Fidelity Insurance & Luzon Insurance Co.,14 Liberty

Insurance Corporation vs. Banuelos,15 and Luzon Surety, Inc.

vs. De Garcia,16 cited by the respondents, we ruled that:

“The fruits of the paraphernal property which form part of the

assets of the conjugal partnership, are subject to the payment of

the debts and expenses of the spouses, but not to the payment of

the personal obligations (guaranty agreements) of the husband,

unless it be proved that such obligations were productive of some

benefit to the family.” (Ansaldo; parenthetical phrase ours.)

“When there is no showing that the execution of an indemnity

agreement by the husband redounded to the benefit of his family,

the undertaking is not a conjugal debt but an obligation personal

to him.” (Liberty Insurance)

“In the most categorical language, a conjugal partnership under

Article 161 of the new Civil Code is liable only for such ‘debts and

obligations contracted by the husband for the benefit of the

conjugal partnership.’ There must be the requisite showing then of

some advantage which clearly accrued to the welfare of the

spouses. Certainly, to make a conjugal partnership respond for a

liability that should appertain to the husband alone is to defeat

and frustrate the avowed objective of the new Civil Code to show

the utmost concern for the solidarity and well-being of the family

as a unit. The husband, therefore, is denied the power to assume

unnecessary and unwarranted risks to the financial stability of the

conjugal partnership.” (Luzon Surety, Inc.)

From the foregoing jurisprudential rulings of this Court, we

can derive the following conclusions:

(A) If the husband himself is the principal obligor in the

contract, i.e., he directly received the money and services to

be used in or for his own business or his own profession, that

_______________

14 No. 43257, February 19, 1937,64 Phil. 115.

15 59 OG No. 29,4526.

16 No. L-25659, October 31, 1969,30 SCRA 111.


REPORTS

ANNOTATED

Ayala Investment &


of Appeals

contract falls within the term “x x x x obligations for the

benefit of the conjugal partnership.” Here, no actual benefit

may be proved. It is enough that the benefit to the family is




53

apparent at the time of the signing of the contract. From the

very nature of the contract of loan or services, the family

stands to benefit from the loan facility or services to be

rendered to the business or profession of the husband. It is

immaterial, if in the end, his business or profession fails or

does not succeed. Simply stated, where the husband

contracts obligations on behalf of the family business, the law

presumes, and rightly so, that such obligation will redound to

the benefit of the conjugal partnership.

(B) On the other hand, if the money or services are given

to another person or entity, and the husband acted only as

a surety or guarantor, that contract cannot, by itself, alone be

categorized as falling within the context of “obligations for

the benefit of the conjugal partnership.” The contract of loan

or services is clearly for the benefit of the principal debtor

and not for the surety or his family. No presumption can be

inferred that, when a husband enters into a contract of

surety or accommodation agreement, it is “for the benefit of

the conjugal partnership.” Proof must be presented to

establish benefit redounding to the conjugal partnership.

Thus, the distinction between the Cobb-Perez case, and we

add, that of the three other companion cases, on the one

hand, and that of Ansaldo, Liberty Insurance and Luzon

Surety, is that in the former, the husband contracted the

obligation for his own business; while in the latter, the

husband merely acted as a surety for the loan contracted by

another for the latter’s business.

The evidence of petitioner indubitably show that co-

respondent Alfredo Ching signed as surety for the P50M loan

contracted on behalf of PBM. Petitioner should have adduced

evidence to prove that Alfredo Ching’s acting as surety

redounded to the benefit of the conjugal partnership. The

reason for this is as lucidly explained by the respondent

court:

283

VOL. 286, FEBRUARY

12, 1998

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Ayala Investment &


of Appeals

“The loan procured from respondent-appellant AIDC was for the

advancement and benefit of Philippine Blooming Mills and not for

the benefit of the conjugal partnership of petitioners-appellees.

Philippine Blooming Mills has a personality distinct and separate

from the family of petitioners-appellees—this despite the fact that

the members of the said family happened to be stockholders of said

corporate entity.”

x x x x x x x x x

x x x. The burden of proof that the debt was contracted for the

benefit of the conjugal partnership of gains, lies with the creditor-

party litigant claiming as such. In the case at bar, respondent-

appellant AIDC failed to prove that the debt was contracted by

appellee-husband, for the benefit of the conjugal partnership of

gains. What is apparent from the facts of the case is that the

judgment debt was contracted by or in the name of the Corporation

Philippine Blooming Mills and appellee-husband only signed as

surety thereof. The debt is clearly a corporate debt and

respondent-appellant’s right of recourse against appellee-husband

as surety is only to the extent of his corporate stockholdings. It

does not extend to the conjugal partnership of gains of the family

of petitioners-appellees. x x x x x x.”17

Petitioners contend that no actual benefit need accrue to the

conjugal partnership. To support this contention, they cite

Justice J.B.L. Reyes’ authoritative opinion in the Luzon

Surety Company case:

“I concur in the result, but would like to make of record that, in my

opinion, the words ‘all debts and obligations contracted by the

husband for the benefit of the conjugal partnership’ used in Article

161 of the Civil Code of the Philippines in describing the charges

and obligations for which the conjugal partnership is liable do not


54

require that actual profit or benefit must accrue to the conjugal

partnership from the husband’s transaction; but it suffices that the

transaction should be one that normally would produce such

benefit for the partnership. This is the ratio behind our ruling in

Javier vs. Osmeña, 34 Phil. 336, that obligations incurred by the

husband in the practice of his profession are collectible from the

conjugal partnership.”

_______________

17 See pp. 38-39, rollo.


REPORTS

ANNOTATED

Ayala Investment &


of Appeals

The aforequoted concurring opinion agreed with the majority

decision that the conjugal partnership should not be made

liable for the surety agreement which was clearly for the

benefit of a third party. Such opinion merely registered an

exception to what may be construed as a sweeping statement

that in all cases actual profit or benefit must accrue to the

conjugal partnership. The opinion merely made it clear that

no actual benefits to the family need be proved in some cases

such as in the Javier case. There, the husband was the

principal obligor himself. Thus, said transaction was found to

be “one that would normally produce x x x benefit for the

partnership.” In the later case of G-Tractors, Inc., the

husband was also the principal obligor—not merely the

surety. This latter case, therefore, did not create any

precedent. It did not also supersede the Luzon Surety

Company case, nor any of the previous accommodation

contract cases, where this Court ruled that they were for the

benefit of third parties.

But it could be argued, as the petitioner suggests, that

even in such kind of contract of accommodation, a benefit for

the family may also result,when the guarantee is in favor of

the husband’s employer.

In the case at bar, petitioner claims that the benefits the

respondent family would reasonably anticipate were the

following:

1. (a)The employment of co-respondent Alfredo Ching would

be prolonged and he would be entitled to his monthly

salary of P20,000.00 for an extended length of time

because of the loan he guaranteed;

2. (b)The shares of stock of the members of his family would

appreciate if the PBM could be rehabilitated through the

loan obtained;

3. (c)His prestige in the corporation would be enhanced and

his career would be boosted should PBM survive because

of the loan.

However, these are not the benefits contemplated by Article

161 of the Civil Code. The benefits must be one directly


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resulting from the loan. It cannot merely be a by-product or a

spin-off of the loan itself.

In all our decisions involving accommodation contracts of

the husband,18 we underscored the requirement that: “there

must be the requisite showing x x x of some advantage which

clearly accrued to the welfare of the spouses” or “benefits to


55

his family” or “that such obligations are productive of some

benefit to the family.” Unfortunately, the petition did not

present any proof to show: (a) Whether or not the corporate

existence of PBM was prolonged and for how many months or

years; and/or (b) Whether or not the PBM was saved by the

loan and its shares of stock appreciated, if so, how much and

how substantial was the holdings of the Ching family.

Such benefits (prospects of longer employment and

probable increase in the value of stocks) might have been

already apparent or could be anticipated at the time the

accommodation agreement was entered into. But would those

“benefits” qualify the transaction as one of the “obligations x

x x for the benefit of the conjugal partnership?” Are indirect

and remote probable benefits, the ones referred to in Article

161 of the Civil Code? The Court of Appeals in denying the

motion for reconsideration, disposed of these questions in the

following manner:

“No matter how one looks at it, the debt/credit extended by

respondents-appellants is purely a corporate debt granted to PBM,

with petitioner-appellee-husband merely signing as surety. While

such petitioner-appellee-husband, as such surety, is solidarily

liable with the principal debtor AIDC, such liability under the

Civil Code provisions is specifically restricted by Article 122 (par.

1) of the Family Code, so that debts for which the husband is liable

may not be charged against conjugal partnership properties.

Article 122 of the Family Code is explicit—‘The payment of

personal debts contracted by the husband or the wife before or

during the marriage shall not be charged to the conjugal

partnership except insofar as they redounded to the benefit of the

family.’

_______________

18 Ansaldo, et al. vs. Liberty Insurance Company, Inc. & Luzon Surety

Company, supra.


REPORTS

ANNOTATED

Ayala Investment &


of Appeals

Respondents-appellants insist that the corporate debt in question

falls under the exception laid down in said Article 122 (par. one).

We do not agree. The loan procured from respondent-appellant

AIDC was for the sole advancement and benefit of Philippine

Blooming Mills and not for the benefit of the conjugal partnership

of petitioners-appellees.

x x x appellee-husband derives salaries, dividends benefits from

Philippine Blooming Mills (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 Article 122 (Family Code) is that benefit 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

petitioner-appellee-husband or his family. The alleged benefit, if

any, continuously harped by respondents-appellants, are not only

incidental but also speculative.”19

We agree with the respondent court. Indeed, considering the

odds involved in guaranteeing a large amount

(P50,000,000.00) of loan, the probable prolongation of

employment in PBM and increase in value of its stocks,

would be too small to qualify the transaction as one “for the

benefit” of the surety’s family. Verily, no one could say, with

a degree of certainty, that the said contract is even

“productive of some benefits” to the conjugal partnership.

We likewise agree with the respondent court (and this

view is not contested by the petitioners) that the provisions of

the Family Code is applicable in this case. These provisions


56

highlight the underlying concern of the law for the

conservation of the conjugal partnership; for the husband’s

duty to protect and safeguard, if not augment, not to

dissipate it.

This is the underlying reason why the Family Code

clarifies that the obligations entered into by one of the

spouses must be those that redounded to the benefit of the

family and that

_______________

19 Court of Appeals Resolution of Nov. 28, 1994 denying the motion for

reconsideration, pp. 1-2; Annex “B”; p. 41, rollo.


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the measure of the partnership’s liability is to “the extent

that the family is benefited.”20

These are all in keeping with the spirit and intent of the

other provisions of the Civil Code which prohibits any of the

spouses to donate or convey gratuitously any part of the

conjugal property.21 Thus, when co-respondent Alfredo Ching

entered into a surety agreement he, from then on, definitely

put in peril the conjugal property (in this case, including the

family home) and placed it in danger of being taken

gratuitously as in cases of donation.

In the second assignment of error, the petitioner advances

the view that acting as surety is part of the business or

profession of the respondent-husband.

This theory is new as it is novel.

The respondent court correctly observed that:

“Signing as a surety is certainly not an exercise of an industry or

profession, hence the cited cases of Cobb-Perez vs. Lantin; Abella

de Diaz vs. Erlanger & Galinger; G-Tractors, Inc. vs. CA do not

apply in the instant case. Signing as a surety is not embarking in a

business.”22

We are likewise of the view that no matter how often an

executive acted or was persuaded to act, as a surety for his

own employer, this should not be taken to mean that he had

thereby embarked in the business of suretyship or guaranty.

This is not to say, however, that we are unaware that

executives are often asked to stand as surety for their

company’s loan obligations. This is especially true if the

corporate officials have sufficient property of their own;

otherwise, their spouses’ signatures are required in order to

bind the conjugal partnerships.

_______________

20 Article 121, Nos. 2 & 3, Family Code.

21 Article 174, Civil Code.

22 Denial of motion for reconsideration, supra.


REPORTS

ANNOTATED

Ayala Investment &


of Appeals

The fact that on several occasions the lending institutions did

not require the signature of the wife and the husband signed

alone does not mean that being a surety became part of his

profession. Neither could he be presumed to have acted for

the conjugal partnership.

Article 121, paragraph 3, of the Family Code is emphatic

that the payment of personal debts contracted by the




57

husband or the wife before or during the marriage shall not

be charged to the conjugal partnership except to the extent

that they redounded to the benefit of the family.

Here, the property in dispute also involves the family

home. The loan is a corporate loan not a personal one.

Signing as a surety is certainly not an exercise of an industry

or profession nor an act of administration for the benefit of

the family.

On the basis of the facts, the rules, the law and equity, the

assailed decision should be upheld as we now uphold it. This

is, of course, without prejudice to petitioner’s right to enforce

the obligation in its favor against the PBM receiver in

accordance with the rehabilitation program and payment

schedule approved or to be approved by the Securities &

Exchange Commission.

WHEREFORE, the petition for review should be, as it is

hereby, DENIED for lack of merit.

SO ORDERED.

Regalado (Chairman),Melo, Puno and Mendoza,

JJ.,concur.

Petition denied.

Note.—Property acquired by both spouses through their

work and industry shall be governed by the rules on equal co-

ownership. (Valdes vs. Regional Trial Court, Br. 102, Quezon

City, 260 SCRA 221 [1996])

——o0o——

58

G.R. No. 125172. June 26, 1998.*

Spouses ANTONIO and LUZVIMINDA GUIANG,

petitioners, vs. COURT OF APPEALS and GILDA CORPUZ,

respondents.

Contracts; Sales; Husband and Wife; Conjugal

Partnerships;The absence of the consent of one spouse in the sale of

a conjugal property renders the sale null and void, while the

vitiation thereof makes it merely voidable.—The sale of a conjugal

property requires the consent of both the husband and the wife.

The absence of the consent of one renders the sale null and void,

while the vitiation thereof makes it merely voidable. Only in the

latter case can ratification cure the defect.

Same; Same; Same; Same;Family Code; Article 1390,

paragraph 2, of the Civil Code refers to contracts visited by vices of

consent, but where a spouse’s consent to the contract of sale of the

conjugal property is totally inexistent or absent, the contract falls

within the ambit of Article 124 of the Family Code.—The error in

petitioners’ contention is evident. Article 1390, par. 2, refers to

contracts visited by vices of consent, i.e., contracts which were

entered into by a person whose consent was obtained and vitiated

through mistake, violence, intimidation, undue influence or fraud.

In this instance, private respondent’s consent to the contract of

sale of their conjugal property was totally inexistent or absent. x x

x This being the case, said contract properly falls within the ambit

of Article 124 of the Family Code, which was correctly applied by

the two lower courts. x x x In the event that one spouse is

incapacitated or otherwise unable to participate in the

administration of the conjugal properties, the other spouse may

assume sole powers of administration. These powers do not include

the powers of disposition or encumbrance which must have the

authority of the court or the written consent of the other spouse. In

the absence of such authority or consent, the disposition or

encumbrance shall be void. However, the transaction shall be

construed as a continuing offer on the part of the consenting

spouse and the third person, and may be perfected as a binding

contract upon the acceptance by the other spouse or authorization

by the court before the offer is withdrawn by either or both

offerors. (165a)” (Italics supplied)

Same; Same; Same; Same; A void contract cannot be

ratified.—The position is not well taken. The trial and the

appellate courts have resolved this issue in favor of the private

respondent. The trial court correctly held: “By the specific

provision of the law [Art. 1390, Civil Code] therefore, the Deed of

Transfer of Rights (Exh. ‘A’) cannot be ratified, even by an

‘amicable settlement.’ The participation by some barangay

authorities in the ‘amicable settlement’ cannot otherwise validate

an invalid act. Moreover, it cannot be denied that the ‘amicable

settlement’ (Exh. ‘B’) entered into by plaintiff Gilda Corpuz and

defendant spouses Guiang is a contract. It is a direct offshoot of

the Deed of Transfer of Rights (Exh. ‘A’). By express provision of

law, such a contract is also void. Thus, the legal provision, to wit:

‘Art. 1422. A contract which is the direct result of a previous illegal

contract, is also void and inexistent.’ (Civil Code of the

Philippines). In summation therefore, both the Deed of Transfer of

Rights (Exh. ‘A’) and the ‘amicable settlement’ (Exh. ‘3’) are null

and void.” Doctrinally and clearly, a void contract cannot be

ratified.


of Appeals.


Public Attorney’s Officefor petitioners.

Arnold D. Cruz for private respondent.

PANGANIBAN, J.:

The sale of a conjugal property requires the consent of both

the husband and the wife. The absence of the consent of one

renders the sale null and void, while the vitiation thereof

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59

makes it merely voidable. Only in the latter case can

ratification cure the defect.

The Case

These were the principles that guided the Court in deciding

this petition for review of the Decision1 dated January 30,

1996 and the Resolution2 dated May 28, 1996, promulgated

by the Court of Appeals in CA-GR CV No. 41758, affirming

the Decision of the lower court and denying reconsideration,

respectively.

On May 28, 1990, Private Respondent Gilda Corpuz filed

an Amended Complaint3against her husband Judie Corpuz

and Petitioners-Spouses Antonio and Luzviminda Guiang.

The said Complaint sought the declaration of a certain deed

of sale, which involved the conjugal property of private

respondent and her husband, null and void. The case was

raffled to the Regional Trial Court of Koronadal, South

Cotabato, Branch 25. In due course, the trial court rendered

a Decision4 dated September 9, 1992, disposing as follows:5

“ACCORDINGLY, judgment is rendered for the plaintiff and

against the defendants,

1. 1.Declaring both the Deed of Transfer of Rights dated

March 1, 1990 (Exh. ‘A’) and the ‘amicable settlement’

dated March 16, 1990 (Exh. ‘B’) as null and void and of no

effect;

2. 2.Recognizing as lawful and valid the ownership and

possession of plaintiff Gilda Corpuz over the remaining

one-half portion of Lot 9, Block 8, (LRC) Psd-165409 which

has been the subject of the Deed of Transfer of Rights

(Exh. ‘A’);

3. 3.Ordering plaintiff Gilda Corpuz to reimburse defendants

Luzviminda and Antonio Guiang the amount of NINE

THOUSAND (P9,000.00) PESOS corresponding to the

payment made by defendants Guiangs to Manuel Callejo

for the unpaid balance of the account of plaintiff in favor of

Manuel Callejo, and another sum of P379.62 representing

one-half of the amount of realty taxes paid by defendants

Guiangs on Lot 9, Block 8, (LRC) Psd-165409, both with

legal interests thereon computed from the finality of the

decision.

No pronouncement as to costs in view of the factual circumstances

of the case.”

Dissatisfied, petitioners-spouses filed an appeal with the

Court of Appeals. Respondent Court, in its challenged

Decision, ruled as follows:6

“WHEREFORE, the appealed decision of the lower court in Civil

Case No. 204 is hereby AFFIRMED by this Court. No costs

considering plaintiff-appellee’s failure to file her brief, despite

notice.”

Reconsideration was similarly denied by the same court in its

assailed Resolution:7

“Finding that the issues raised in defendants-appellants’ motion

for reconsideration of Our decision in this case of January 30,

1996, to be a mere rehash of the same issues which We have

already passed upon in the said decision, and there [being] no

cogent reason to disturb the same, this Court RESOLVES to

DENY the instant motion for reconsideration for lack of merit.”

The Facts

The facts of this case are simple. Over the objection of private

respondent and while she was in Manila seeking

employment, her husband sold to the petitioners-spouses one

half of their conjugal property, consisting of their residence

and the lot on which it stood. The circumstances of this sale

are set forth in the Decision of Respondent Court, which

quoted from the Decision of the trial court as follows:8

“1. Plaintiff Gilda Corpuz and defendant Judie Corpuz are legally

married spouses. They were married on December 24, 1968 in









60

Bacolod City, before a judge. This is admitted by defendants-

spouses Antonio and Luzviminda Guiang in their answer, and also

admitted by defendant Judie Corpuz when he testified in court

(tsn. p. 3, June 9, 1992), although the latter says that they were

married in 1967. The couple have three children, namely: Junie—

18 years old, Harriet—17 years of age, and Jodie or Joji, the

youngest, who was 15 years of age in August, 1990 when her

mother testified in court. Sometime on February 14, 1983, the

couple Gilda and Judie Corpuz, with plaintiff-wife Gilda Corpuz as

vendee, bought a 421 sq. meter lot located in Barangay Gen.

Paulino Santos (Bo. 1), Koronadal, South Cotabato, and

particularly known as Lot 9, Block 8, (LRC) Psd-165409 from

Manuel Callejo who signed as vendor through a conditional deed of

sale for a total consideration of P14,735.00. The consideration was

payable in installment, with right of cancellation in favor of vendor

should vendee fail to pay three successive installments (Exh. ‘2,’

tsn, p. 6, February 14, 1990).

2. Sometime on April 22, 1988, the couple Gilda and Judie

Corpuz sold one-half portion of their Lot No. 9, Block 8, (LRC) Psd-

165409 to the defendants-spouses Antonio and Luzviminda

Guiang. The latter have since then occupied the one-half portion

[and] built their house thereon (tsn, p. 4, May 22, 1992). They are

thus adjoining neighbors of the Corpuzes.

3. Plaintiff Gilda Corpuz left for Manila sometime in June 1989.

She was trying to look for work abroad, in [the] Middle East.

Unfortunately, she became a victim of an unscrupulous illegal

recruiter. She was not able to go abroad. She stayed for sometime

in Manila however, coming back to Koronadal, South Cotabato, x x

x on March 11, 1990. Plaintiff’s departure for Manila to look for

work in the Middle East was with the consent of her husband

Judie Corpuz (tsn, p. 16, Aug. 12, 1990; p. 10, Sept. 6, 1991).

After his wife’s departure for Manila, defendant Judie Corpuz

seldom went home to the conjugal dwelling. He stayed most of the

time at his place of work at Samahang Nayon Building, a hotel,

restaurant, and a cooperative. Daughter Harriet Corpuz went to

school at King’s College, Bo. 1, Koronadal, South Cotabato, but she

was at the same time working as household help of, and staying at,

the house of Mr. Panes. Her brother Junie was not working. Her

younger sister Jodie (Joji) was going to school. Her mother

sometimes sent them money (tsn, p. 14, Sept. 6, 1991).

Sometime in January 1990, Harriet Corpuz learned that her

father intended to sell the remaining one-half portion including

their house, of their homelot to defendants Guiangs. She wrote a

letter to her mother informing her. She [Gilda Corpuz] replied that

she was objecting to the sale. Harriet, however, did not inform her

father about this; but instead gave the letter to Mrs. Luzviminda

Guiang so that she [Guiang] would advise her father (tsn, pp. 16-

17, Sept. 6, 1991).

4. However, in the absence of his wife Gilda Corpuz, defendant

Judie Corpuz pushed through the sale of the remaining one-half

portion of Lot 9, Block 8, (LRC) Psd-165409. On March 1, 1990, he

sold to defendant Luzviminda Guiang thru a document known as

‘Deed of Transfer of Rights’ (Exh. ‘A’) the remaining one-half

portion of their lot and the house standing thereon for a total

consideration of P30,000.00 of which P5,000.00 was to be paid in

June, 1990. Transferor Judie Corpuz’s children Junie and Harriet

signed the document as witnesses.

Four (4) days after March 1, 1990 or on March 5, 1990,

obviously to cure whatever defect in defendant Judie Corpuz’s title

over the lot transferred, defendant Luzviminda Guiang as vendee

executed another agreement over Lot 9, Block 8, (LRC) Psd-165408

(Exh. ‘3’), this time with Manuela Jimenez Callejo, a widow of the

original registered owner from whom the couple Judie and Gilda

Corpuz originally bought the lot (Exh. ‘2’), who signed as vendor

for a consideration of P9,000.00. Defendant Judie Corpuz signed as

a witness to the sale (Exh. ‘3-A’). The new sale (Exh. ‘3’) describes

the lot sold as Lot 8, Block 9, (LRC) Psd-165408 but it is obvious

from the mass of evidence that the correct lot is Lot 8, Block 9,

(LRC) Psd-165409, the very lot earlier sold to the couple Gilda and

Judie Corpuz.

61

1. 5.Sometime on March 11, 1990, plaintiff returned home.

She found her children staying with other households.

Only Junie was staying in their house. Harriet and Joji

were with Mr. Panes. Gilda gathered her children together

and stayed at their house. Her husband was nowhere to be

found. She was informed by her children that their father

had a wife already.

2. 6.For staying in their house sold by her husband, plaintiff

was complained against by defendant Luzviminda Guiang

and her husband Antonio Guiang before the Barangay

authorities of Barangay General Paulino Santos (Bo. 1),

Koronadal, South Cotabato, for trespassing (tsn. p. 34,

Aug. 17, 1990). The case was docketed by the barangay

authorities as Barangay Case No. 38 for ‘trespassing.’ On

March 16, 1990, the parties thereat signed a document

known as ‘amicable settlement.’ In full, the settlement

provides for, to wit:

‘That respondent, Mrs. Gilda Corpuz and her three children, namely:

Junie, Harriet and Judie to leave voluntarily the house of Mr. and Mrs.

Antonio Guiang, where they are presently boarding without any charge,

on or before April 7, 1990.

FAIL NOT UNDER THE PENALTY OF THE LAW.

Believing that she had received the shorter end of the bargain,

plaintiff went to the Barangay Captain of Barangay Paulino

Santos to question her signature on the amicable settlement. She

was referred however to the Officer-In-Charge at the time, a

certain Mr. de la Cruz. The latter in turn told her that he could not

do anything on the matter (tsn. p. 31, Aug. 17, 1990).

This particular point was not rebutted. The Barangay Captain

who testified did not deny that Mrs. Gilda Corpuz approached him

for the annulment of the settlement. He merely said he forgot

whether Mrs. Corpuz had approached him (tsn. p. 13, Sept. 26,

1990). We thus conclude that Mrs. Corpuz really approached the

Barangay Captain for the annulment of the settlement.

Annulment not having been made, plaintiff stayed put in her

house and lot.

7. Defendant-spouses Guiang followed thru the amicable

settlement with a motion for the execution of the amicable

settlement, filing the same with the Municipal Trial Court of

Koronadal, South Cotabato. The proceedings [are] still pending

before the said court, with the filing of the instant suit.

379 VOL. 291, JUNE 26,

1998

379

Guiang vs. Court of Appeals

8. As a consequence of the sale, the spouses Guiang spent P600.00

for the preparation of the Deed of Transfer of Rights, Exh. ‘A’;

P9,000.00 as the amount they paid to Mrs. Manuela Callejo,

having assumed the remaining obligation of the Corpuzes to Mrs.

Callejo (Exh. ‘3’); P100.00 for the preparation of Exhibit ‘3’; a total

of P759.62 basic tax and special educational fund on the lot;

P127.50 as the total documentary stamp tax on the various

documents; P535.72 for the capital gains tax; P22.50 as transfer

tax; a standard fee of P17.00; certification fee of P5.00. These

expenses particularly the taxes and other expenses towards the

transfer of the title to the spouses Guiangs were incurred for the

whole Lot 9, Block 8, (LRC) Psd-165409.”

Ruling of Respondent Court

Respondent Court found no reversible error in the trial

court’s ruling that any alienation or encumbrance by the

husband of the conjugal property without the consent of his

wife is null and void as provided under Article 124 of the

Family Code. It also rejected petitioners’ contention that the

“amicable settlement” ratified said sale, citing Article 1409 of

the Code which expressly bars ratification of the contracts

specified therein, particularly those “prohibited or declared

void by law.”

62

Hence, this petition.9

The Issues

In their Memorandum, petitioners assign to public

respondent the following errors:10

“I

Whether or not the assailed Deed of Transfer of Rights was validly

executed.

II

Whether or not the Court of Appeals erred in not declaring as

voidable contract under Art. 1390 of the Civil Code the impugned

Deed of Transfer of Rights which was validly ratified thru the

execution of the ‘amicable settlement’ by the contending parties.

III

Whether or not the Court of Appeals erred in not setting aside

the findings of the Court a quo which recognized as lawful and

valid the ownership and possession of private respondent over the

remaining one-half (1/2) portion of the subject property.”

In a nutshell, petitioners-spouses contend that (1) the

contract of sale (Deed of Transfer of Rights) was merely

voidable, and (2) such contract was ratified by private

respondent when she entered into an amicable settlement

with them.

This Court’s Ruling

The petition is bereft of merit.

First Issue: Void or Voidable Contract?

Petitioners insist that the questioned Deed of Transfer of

Rights was validly executed by the parties-litigants in good

faith and for valuable consideration. The absence of private

respondent’s consent merely rendered the Deed voidable

under Article 1390 of the Civil Code, which provides:

“ART. 1390. The following contracts are voidable or annullable,

even though there may have been no damage to the contracting

parties:

x x x x x x x x x

(2) Those where the consent is vitiated by mistake, violence,

intimidation, undue influence or fraud.

These contracts are binding, unless they are annulled by a

proper action in court. They are susceptible of ratification.(n)”

The error in petitioners’ contention is evident. Article 1390,

par. 2, refers to contracts visited by vices of consent, i.e.,

contracts which were entered into by a person whose consent

was obtained and vitiated through mistake, violence,

intimidation, undue influence or fraud. In this instance,

private respondent’s consent to the contract of sale of their

conjugal property was totally inexistent or absent. Gilda

Corpuz, on direct examination, testified thus:11

“Q Now, on March 1, 1990,

could you still recall

where you were?

A I was still in Manila

during that time.

x x x x x x x x x

ATTY. FUENTES:

Q When did you come back

to Koronadal, South

Cotabato?

A That was on March 11,

1990, Ma’am.

Q Now, when you arrived at

Koronadal, was there any

problem which arose

concerning the ownership




63

of your residential house

at Callejo Subdivision?

A When I arrived here in

Koronadal, there was a

problem which arose

regarding my residential

house and lot because it

was sold by my husband

without my knowledge.”

This being the case, said contract properly falls within the

ambit of Article 124 of the Family Code, which was correctly

applied by the two lower courts:

“ART. 124. The administration and enjoyment of the conjugal

partnership property shall belong to both spouses jointly. In case of

disagreement, the husband’s decision shall prevail, subject to

recourse to the court by the wife for proper remedy, which must be

availed of within five years from the date of the contract

implementing such decision.

In the event that one spouse is incapacitated or otherwise

unable to participate in the administration of the conjugal

properties, the other spouse may assume sole powers of

administration. These powers do not include the powers of

disposition or encumbrance

________________

11 TSN, August 17, 1990, pp. 16-17.


REPORTS

ANNOTATED


which must have the authority of the court or the written consent

of the other spouse. In the absence of such authority or consent, the

disposition or encumbrance shall be void. However, the transaction

shall be construed as a continuing offer on the part of the

consenting spouse and the third person, and may be perfected as a

binding contract upon the acceptance by the other spouse or

authorization by the court before the offer is withdrawn by either

or both offerors. (165a)” (Italics supplied)

Comparing said law with its equivalent provision in the Civil

Code, the trial court adroitly explained the amendatory effect

of the above provision in this wise:12

“The legal provision is clear. The disposition or encumbrance is

void. It becomes still clearer if we compare the same with the

equivalent provision of the Civil Code of the Philippines. Under

Article 166 of the Civil Code, the husband cannot generally

alienate or encumber any real property of the conjugal partnership

without the wife’s consent. The alienation or encumbrance if so

made however is not null and void. It is merely voidable. The

offended wife may bring an action to annul the said alienation or

encumbrance. Thus, the provision of Article 173 of the Civil Code

of the Philippines, to wit:

‘Art. 173. The wife may, during the marriage and within ten 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 property

fraudulently alienated by the husband.(n)’

This particular provision giving the wife ten (10) years x x x

during [the] marriage to annul the alienation or encumbrance was

not carried over to the Family Code. It is thus clear that 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.”

________________


64

12 Rollo, p. 37.

383 VOL. 291, JUNE 26,

1998

383


Furthermore, it must be noted that the fraud and the

intimidation referred to by petitioners were perpetrated in

the execution of the document embodying the amicable

settlement. Gilda Corpuz alleged during trial that barangay

authorities made her sign said document through

misrepresentation and coercion.13 In any event, its execution

does not alter the void character of the deed of sale between

the husband and the petitioners-spouses, as will be discussed

later. The fact remains that such contract was entered into

without the wife’s consent.

In sum, the nullity of the contract of sale is premised on

the absence of private respondent’s consent. To constitute a

valid contract, the Civil Code requires the concurrence of the

following elements: (1) cause, (2) object, and (3) consent,14 the

last element being indubitably absent in the case at bar.

Second Issue: Amicable Settlement

Insisting that the contract of sale was merely voidable,

petitioners aver that it was duly ratified by the contending

parties through the “amicable settlement” they executed on

March 16, 1990 in Barangay Case No. 38.

The position is not well taken. The trial and the appellate

courts have resolved this issue in favor of the private

respondent. The trial court correctly held:15

“By the specific provision of the law [Art. 1390, Civil Code]

therefore, the Deed of Transfer of Rights (Exh. ‘A’) cannot be

ratified, even by an ‘amicable settlement.’ The participation by

some barangay authorities in the ‘amicable settlement’ cannot

otherwise validate an invalid act. Moreover, it cannot be denied

that the ‘amicable settlement’ (Exh. ‘B’) entered into by plaintiff

Gilda Corpuz and defendant spouses Guiang is a contract. It is a

direct offshoot of the Deed of Transfer of Rights (Exh. ‘A’). By

express provi-

________________

13 TSN, August 17, 1990, pp. 13-14.

14 Art. 1318, Civil Code.

15 Rollo, p. 38.


REPORTS

ANNOTATED


sion of law, such a contract is also void. Thus, the legal provision,

to wit:

‘Art. 1422. A contract which is the direct result of a previous illegal

contract, is also void and inexistent.’ (Civil Code of the Philippines).

In summation therefore, both the Deed of Transfer of Rights

(Exh. ‘A’) and the ‘amicable settlement’ (Exh. ‘3’) are null and

void.”

Doctrinally and clearly, a void contract cannot be

ratified.16Neither 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 the pertinent events is clear: after the sale, petitioners

filed a complaint for trespassing against private respondent,

after which the barangay authorities secured an “amicable

settlement” and petitioners filed before the MTC a motion for

its execution. 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 private

respondent would vacate the property. By no stretch of the

imagination, can the Court interpret this document as the

acceptance mentioned in Article 124.





65

WHEREFORE, the Court hereby DENIES the petition

and AFFIRMS the challenged Decision and Resolution. Costs

against petitioners.

SO ORDERED.

Davide,

Jr.(Chairman), Bellosillo, Vitugand Quisumbing, JJ., concur.

Petition denied, judgment and resolution affirmed.

Notes.—The presumption is that all property of the

marriage belongs to the conjugal partnership, unless it is

proved that it pertains exclusively to the husband or the

wife. (Cuenca vs. Cuenca, 168 SCRA 335 [1988])

Where a woman who cohabited with a married man fails

to prove that she contributed money to the purchase price of

a riceland, there is no basis to justify her co-ownership over

the same—the riceland should revert to the conjugal

partnership property of the man and his lawful wife. (Agapay

vs. Palang, 276 SCRA 340[1997])

——o0o——

66

G.R. No. 166496. November 29, 2006.*

JOSEFA BAUTISTA FERRER, petitioner, vs. SPS.

MANUEL M. FERRER & VIRGINIA FERRER and SPS.

ISMAEL M. FERRER and FLORA FERRER, respondents.

Actions; Causes of Action;Elements; Failure to make a

sufficient allegation of a cause of action in the complaint warrants

the dismissal thereof.—Section 1(g) Rule 16 of the 1997 Rules of

Civil Procedure makes it clear that failure to make a sufficient

allegation of a cause of action in the complaint warrants the

dismissal thereof. Section 2, Rule 2 of the 1997 Rules of Civil

Procedure defines a cause of action as the act or omission by which

a party violates the right of another. It is the delict or the wrongful

act or omission committed by the defendant in violation of the

primary right of the plaintiff. A cause of action has the following

essential elements, viz.: (1) A right in favor of the plaintiff by

whatever means and under whatever law it arises or is created; (2)

An obligation on the part of the named defendant to respect or not

to violate such right; and (3) Act or omission on the part of such

defendant in violation of the right of the plaintiff or constituting a

breach of the obligation of the defendant to the plaintiff for which

the latter may maintain an action for recovery of damages or other

appropriate relief.

Husband and Wife; Conjugal Partnerships; Sales; The

obligation to reimburse for the cost of improvements, under Article

120 of the Family Code, rests on the spouse upon whom ownership

of the

_______________

* FIRST DIVISION.

571

VOL. 508,

NOVEMBER 29, 2006

5

71

Ferrer vs. Ferrer

entire property is vested—there is no obligation on the part of

the purchaser of the property, in case the property is sold by the

ownerspouse; When the cost of the improvement and any resulting

increase in value are more than the value of the property at the time

of the improvement, the entire property of one of the spouses shall

belong to the conjugal partnership, subject to reimbursement of the

value of the property of the owner-spouse at the time of the

improvement, otherwise, said property shall be retained in

ownership by the ownerspouse.—Petitioner was not able to show

that there is an obligation on the part of the respondents to respect

or not to violate her right. While we could concede that Civil Case

No. 61327 made a reference to the right of the spouse as

contemplated in Article 120 of the Family Code to be reimbursed

for the cost of the improvements, the obligation to reimburse rests

on the spouse upon whom ownership of the entire property is

vested. There is no obligation on the part of the purchaser of the

property, in case the property is sold by the ownerspouse. Indeed,

Article 120 provides the solution in determining the ownership of

the improvements that are made on the separate property of the

spouses at the expense of the partnership or through the acts or

efforts of either or both spouses. Thus, when the cost of the

improvement and any resulting increase in value are more than

the value of the property at the time of the improvement, the

entire property of one of the spouses shall belong to the conjugal

partnership, subject to reimbursement of the value of the property

of the owner-spouse at the time of the improvement; otherwise,

said property shall be retained in ownership by the owner-spouse,

likewise subject to reimbursement of the cost of the improvement.

The subject property was precisely declared as the exclusive

property of Alfredo on the basis of Article 120 of the Family Code.

PETITION for review on certiorari of the decision and

resolution of the Court of Appeals.


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67

Romualdo M. Jubay for petitioner.

Tambio Law Office for private respondents.


REPORTS

ANNOTATED

Ferrer vs. Ferrer

CHICO-NAZARIO, J.:

Before this Court is an Appeal by Certiorari which assails the

Decision1 of the Court of Appeals dated 16 August 2004

in CA-G.R. SP No. 78525, reversing and setting aside the

Order2 dated 16 December 2002 of the Regional Trial Court

(RTC), Mandaluyong City, Branch 212 in Civil Case No.

MC02–1780. The Court of Appeals ordered the dismissal of

the Complaint3 filed by petitioner Josefa Bautista Ferrer

against respondents Sps. Manuel M. Ferrer and Virginia

Ferrer, and Sps. Ismael M. Ferrer and Flora Ferrer in the

aforesaid Civil Case No. MC02–1780.

In her Complaint for payment of conjugal improvements,

sum of money, and accounting with prayer for injunction and

damages, petitioner alleged that she is the widow of Alfredo

Ferrer (Alfredo), a half-brother of respondents Manuel M.

Ferrer (Manuel) and Ismael M. Ferrer (Ismael). Before her

marriage to Alfredo, the latter acquired a piece of lot, covered

by Transfer Certificate of Title (TCT) No. 67927.4 He applied

for a loan with the Social Security System (SSS) to build

improvements thereon, including a residential house and a

twodoor apartment building. However, it was during their

marriage that payment of the loan was made using the

couple’s conjugal funds. From their conjugal funds, petitioner

posited, they constructed a warehouse on the lot. Moreover,

petitioner averred that respondent Manuel occupied one door

of the apartment building, as well as the warehouse;

however, in September 1991, he stopped paying rentals

thereon, alleging that he had acquired ownership over the

property by virtue of a Deed of Sale executed by Alfredo in

favor of respondents,

_______________

1 Penned by Associate Justice Delilah Vidallon-Magtolis with Associate

Justices Eliezer R. De Los Santos and Arturo D. Brion, concurring; Rollo, pp.

27–35.

2 Id., at pp. 40–41.

3 Records, pp. 1–9.

4 Id., at pp. 11–12.

573 VOL. 508, NOVEMBER

29, 2006

573

Ferrer vs. Ferrer

Manuel and Ismael and their spouses. TCT No. 67927 was

cancelled, and TCT. No. 2728 was issued and registered in

the names of respondents.

It is petitioner’s contention that on 2 October 1989, when

her husband was already bedridden, respondents Ismael and

Flora Ferrer made him sign a document, purported to be his

last will and testament. The document, however, was a Deed

of Sale covering Alfredo’s lot and the improvements thereon.

Learning of this development, Alfredo filed with the RTC of

Pasig, a Complaint for Annulment of the said sale against

respondents, docketed as Civil Case No. 61327.5 On 22 June

1993, the RTC dismissed the same.6 The RTC found that the

terms and conditions of the Deed of Sale are not contrary to

law, morals, good customs, and public policy, and should be

complied with by the parties in good faith, there being no

compelling reason under the law to do otherwise. The

dismissal was affirmed by the Court of Appeals.

Subsequently, on 7 November 1994, this Court, in G.R. No.







68

L-117067, finding no reversible error committed by the

appellate court in affirming the dismissal of the RTC,

affirmed the Decision of the Court of Appeals.7

Further, in support of her Complaint, petitioner alluded to

a portion of the Decision dated 22 June 1993 of the RTC

in Civil Case No. 61327, which stated, to wit:

“In determining which property is the principal and which is the

accessory, the property of greater value shall be considered the

principal. In this case, the lot is the principal and the

improvements the accessories. 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 reim

_______________

5 Entitled, Sps. Alfredo S. Ferrer and Josefa Jimenez Ferrer v. Sps. Ismael

R. Ferrer and Flora C. Ferrer and Sps. Manuel M. Ferrer and Virginia Ferrer.

6 Penned by Jose H. Hernandez; Records, pp. 17–22.

7 Id., at p. 3.


REPORTS

ANNOTATED

Ferrer vs. Ferrer

burse the conjugal partnership of the cost of improvements at the

time of liquidation of [the] conjugal partnership. Clearly, Alfredo

has all the rights to sell the subject property by himself without

need of Josefa’s consent.”8

According to petitioner, the ruling of the RTC shows that,

when Alfredo died on 29 September 1999, or at the time of

the liquidation of the conjugal partnership, she had the right

to be reimbursed for the cost of the improvements on

Alfredo’s lot. She alleged that the cost of the improvements

amounted to P500,000.00; hence, one-half thereof should be

reimbursed and paid by respondents as they are now the

registered owners of Alfredo’s lot. She averred that

respondents cannot claim lack of knowledge about the fact

that the improvements were constructed using conjugal

funds as they had occupied one of the apartment buildings on

Alfredo’s lot, and even paid rentals to petitioner. In addition,

petitioner prayed that respondents be ordered to render an

accounting from September, 1991, on the income of the

boarding house constructed thereon which they had

appropriated for themselves, and to remit one-half thereof as

her share. Finally, petitioner sought from respondents moral

and exemplary damages, litigation and incidental expenses.

For their part, respondents filed a Motion to

Dismiss,9contending that petitioner had no cause of action

against them, and that the cause of action was barred by

prior judgment.

On 16 December 2002, the RTC rendered an

Order,10denying the Motion to Dismiss. According to the RTC,

no pronouncement as to the improvements constructed on

Alfredo’s lot has been made in Civil Case No. 61327, and the

payment of petitioner’s share in the conjugal partnership

constitutes a separate cause of action. A subsequent

Order11 dated 17

_______________

8 Id., at p. 20.

9 Id., at pp. 201–210.

10 Id., at pp. 244–245.

11 Id., at p. 251.


29, 2006

575

Ferrer vs. Ferrer






69

January 2003 was issued by the RTC, denying respondents’

Motion for Reconsideration.

Aggrieved, respondents elevated the case to the Court of

Appeals by way of a Petition for Certiorari, alleging grave

abuse of discretion amounting to lack or excess of jurisdiction

on the RTC in denying the dismissal.

On 16 August 2004, the Court of Appeals rendered a

Decision granting the Petition. It held that petitioner’s

Complaint failed to state a cause of action. The appellate

court rationalized as follows:

“[W]e believe that the instant complaint is not the proper action

for the respondent to enforce her right of reimbursement of the

cost of the improvement[s] on the subject property. As correctly

pointed out by the petitioners, the same should be made and

directed in the settlement of estate of her deceased husband

Alfredo Ferrer pursuant to Article 12912 of the Family Code. Such

being the case, it ap

_______________

12 Art. 129. Upon the dissolution of the conjugal partnership regime, the

following procedure shall apply:


properties of the conjugal partnership and the exclusive properties

of each spouse.

2. (2)Amounts advanced by the conjugal partnership in payment of

personal debts and obligations of either spouse shall be credited to

the conjugal partnership as an asset thereof.

3. (3)Each spouse shall be reimbursed for the use of his or her exclusive

funds in the acquisition of property or for the value of his or her

exclusive property, the ownership of which has been vested by law

in the conjugal partnership.

4. (4)The debts and obligations of the conjugal partnership shall be paid

out of the conjugal assets. In case of insufficiency of said assets, the

spouses shall be solidarily liable for the unpaid balance with their

separate properties, in accordance with the provisions of paragraph

(2) of Article 121.




REPORTS

ANNOTATED

Ferrer vs. Ferrer

pears that the complaint herein fails to state a cause of action

against the petitioners, the latter not being the proper parties

against whom the subject action for reimbursement must be

directed to. A complaint states a cause of action where it contains

three essential elements of a cause of action, namely: (1) the legal

right of the plaintiff; (2) the correlative obligation of the defendant,

and (3) the act or omission of the defendant in violation of said

legal right. If these elements are absent, the complaint becomes

vulnerable to a motion to dismiss on the ground of failure to state

a cause of action. Albeit the respondent herein has the legal right

to be reimbursed of the cost of the improvements of the subject

property, it is not the petitioners but the estate of her deceased

husband which has the obligation to pay the same. The complaint

herein is therefore dismissible for failure to state a cause of action

against the petitioners. Needless to say, the respondent is not

without any further recourse as she may file her claim against the

estate of her deceased husband.

_______________

1. (6)Unless the owner had been indemnified from whatever source, the

loss or deterioration of movables used for the benefit of the family,

belonging to either spouse, even due to fortuitous event, shall be

paid to said spouse from the conjugal funds, if any.


70

2. (7)The net remainder of the conjugal partnership properties shall

constitute the profits, which shall be divided equally between

husband and wife, unless a different proportion or division was

agreed upon in the marriage settlements or unless there has been a

voluntary waiver or forfeiture of such share as provided in this

Code.


delivered upon the partition in accordance with Article 51.

4. (9)In the partition of the properties, the conjugal dwelling and the lot

on which it is situated shall, unless otherwise agreed upon by the

parties, be adjudicated to the spouse with whom the majority of the

common children choose to remain. Children below the age of seven

years are deemed to have chosen the mother, unless the court has

decided otherwise. In case there is no such majority, the court shall

decide, taking into consideration the best interests of said children.


29, 2006

577

Ferrer vs. Ferrer

In light of the foregoing, we find that the public respondent

committed grave abuse of discretion in denying the petitioners’

motion to dismiss for failure to state a cause of action.”13

Aggrieved, petitioner filed a Motion for Reconsideration

thereon. However, on 17 December 2004, the Court of

Appeals rendered a Resolution14 denying the motion.

Hence, the present recourse.

Petitioner submits the following grounds for the allowance

of the instant Petition, to wit:

1. A.THE HONORABLE COURT OF APPEALS ERRED IN

RULING THAT PETITIONER’S COMPLAINT FAILS TO

STATE A CAUSE OF ACTION AGAINST THE

RESPONDENTS, THE LATTER NOT BEING THE

PROPER PARTIES AGAINST WHOM THE SUBJECT

ACTION FOR REIMBURSEMENT MUST BE DIRECTED

TO.

2. B.THE HONORABLE COURT OF APPEALS ERRED IN

RULING THAT THE PUBLIC RESPONDENT, HON.

RIZALINA T. CAPCO-UMALI, COMMITTED GRAVE

ABUSE OF DISCRETION IN DENYING THE

[RESPONDENTS’] MOTION TO DISMISS FOR

FAILURE TO STATE A CAUSE OF ACTION.15

Both arguments raise the sole issue of whether the Court of

Appeals erred in dismissing petitioner’s Complaint for failure

to state a cause of action.

Section 1(g) Rule 1616 of the 1997 Rules of Civil Procedure

makes it clear that failure to make a sufficient allegation of a

_______________

13 Rollo, pp. 33–34.

14 Penned by Associate Justice Delilah Vidallon-Magtolis with Associate

Justices Eliezer R. De Los Santos and Monina ArevaloZenarosa,

concurring; Rollo, pp. 38–39.

15 Id., at p. 16.

16 Section 1. Grounds.—Within the time for but before filing the answer to

the complaint or pleading asserting a claim, a motion to dismiss may be made

on any of the following grounds:


REPORTS

ANNOTATED

Ferrer vs. Ferrer

cause of action in the complaint warrants the dismissal

thereof. Section 2, Rule 2 of the 1997 Rules of Civil Procedure

defines a cause of action as the act or omission by which a

party violates the right of another. It is the delict or the





71

wrongful act or omission committed by the defendant in

violation of the primary right of the plaintiff.17

A cause of action has the following essential elements,viz.:

1. (1)A right in favor of the plaintiff by whatever means and

under whatever law it arises or is created;

2. (2)An obligation on the part of the named defendant to

respect or not to violate such right; and

3. (3)Act or omission on the part of such defendant in violation

of the right of the plaintiff or constituting a breach of the

obligation

_______________

1. (a)That the court has no jurisdiction over the person of the defending

party;

2. (b)That the court has no jurisdiction over the subject matter of the

claim;

3. (c)That venue is improperly laid;

4. (d)That the plaintiff has no legal capacity to sue;

5. (e)That there is another action pending between the same parties for

the same cause;

6. (f)That the cause of action is barred by a prior judgment or by the

statute of limitations;

7. (g)That the pleading asserting the claim states no cause of action;

8. (h)That the claim or demand set forth in the plaintiff’s pleading has

been paid, waived, abandoned, or otherwise extinguished;

9. (i)That the claim on which the action is founded is unenforceable

under the provisions of the statute of frauds; and

10. (j)That a condition precedent for filing the claim has not been

complied with.

17 Danfoss, Incorporated v. Continental Cement Corporation,G.R. No.

143788, 9 September 2005,469 SCRA 505, 511.

579

VOL. 508, NOVEMBER

29, 2006

579

Ferrer vs. Ferrer

1. of the defendant to the plaintiff for which the latter may

maintain an action for recovery of damages or other

appropriate relief.18

A complaint states a cause of action only when it has the

three indispensable elements.19

In the determination of the presence of these elements,

inquiry is confined to the four corners of the complaint. Only

the statements in the Complaint may be properly

considered.20 The absence of any of these elements makes a

complaint vulnerable to a Motion to Dismiss on the ground of

a failure to state a cause of action.21

After a reading of the allegations contained in petitioner’s

Complaint, we are convinced that the same failed to state a

cause of action.

In the case at bar, petitioner asserts a legal right in her

favor by relying on the Decision of the RTC inCivil Case No.

61327. It can be recalled that the aforesaid case is an action

for Annulment filed by Alfredo and petitioner against the

respondents to seek annulment of the Deed of Sale, executed

by Alfredo in respondents’ favor and covering the herein

subject premises. The Complaint was dismissed by the RTC,

and subsequently affirmed by the Court of Appeals and by

this Court in G.R. No. L-117067.

According to petitioner, while the RTC in Civil Case No.

61327 recognized that the improvements constructed on

Alfredo’s lots were deemed as Alfredo’s exclusive and capital

property, the court also held that petitioner, as Alfredo’s

_______________






72

18 Swagman Hotels and Travel, Inc. v. Court of Appeals and Neal B.

Christian, G.R. No. 161135, 8 April 2005, 455 SCRA 175, 183.

19 Goodyear Philippines, Inc. v. Anthony Sy and Jose L. Lee, G.R. No.

154554, 9 November 2005, 474 SCRA 427, 435.

20 Concepcion V. Vda. de Daffon v. Court of Appeals, G.R. No. 129017,436

Phil. 233, 238; 387 SCRA 427, 432 (2002).

21 Victoria J. Ilano v. Hon. Dolores L. Español, G.R. No. 161756, 16

December 2005, 478 SCRA 365, 372.


REPORTS

ANNOTATED

Ferrer vs. Ferrer

spouse, has the right to claim reimbursement from the estate

of Alfredo. It is argued by petitioner that her husband had no

other property, and his only property had been sold to the

respondents; hence, she has the legal right to claim for

reimbursement from the respondents who are now the

owners of the lot and the improvements thereon. In fine,

petitioner asseverates that the Complaint cannot be

dismissed on the ground of failure to state a cause of action

because the respondents have the correlative obligation to

pay the value of the improvements.

Petitioner was not able to show that there is an obligation

on the part of the respondents to respect or not to violate her

right. While we could concede that Civil Case No.

61327 made a reference to the right of the spouse as

contemplated in Article 12022of the Family Code to be

reimbursed for the cost of the improvements, the obligation

to reimburse rests on the spouse upon whom ownership of

the entire property is vested. There is no obligation on the

part of the purchaser of the property, in case the property is

sold by the owner-spouse.

_______________

22 Art. 120. The ownership of improvements, whether for utility or

adornment, made on the separate property of the spouses at the expense of

the partnership or through the acts or efforts of either or both spouses shall

pertain to the conjugal partnership, or to the original owner-spouse, subject

to the following rules:

When the cost of the improvement made by the conjugal partnership and

any resulting increase in value are more than the value of the property at the

time of the improvement, the entire property of one of the spouses shall

belong to the conjugal partnership, subject to reimbursement of the value of

the property of the owner-spouse at the time of the improvement; otherwise,

said property shall be retained in ownership by the owner-spouse, likewise

subject to reimbursement of the cost of the improvement.

In either case, the ownership of the entire property shall be vested upon

the reimbursement, which shall be made at the time of the liquidation of the

conjugal partnership.


29, 2006

581

Ferrer vs. Ferrer

Indeed, Article 120 provides the solution in determining the

ownership of the improvements that are made on the

separate property of the spouses at the expense of the

partnership or through the acts or efforts of either or both

spouses. Thus, when the cost of the improvement and any

resulting increase in value are more than the value of the

property at the time of the improvement, the entire property

of one of the spouses shall belong to the conjugal partnership,

subject to reimbursement of the value of the property of the

owner-spouse at the time of the improvement; otherwise, said

property shall be retained in ownership by the owner-spouse,

likewise subject to reimbursement of the cost of the

improvement. The subject property was precisely declared as

the exclusive property of Alfredo on the basis of Article 120 of

the Family Code.


73

What is incontrovertible is that the respondents, despite

the allegations contained in the Complaint that they are the

buyers of the subject premises, are not petitioner’s 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 petitioner’s right to be

reimbursed.

On this matter, we do not find an act or omission on the

part of respondents in violation of petitioner’s rights. The

right of the respondents to acquire as buyers the subject

premises from Alfredo under the assailed Deed of Sale in

Civil Case No. 61327 had been laid to rest. This is because

the validity of the Deed of Sale had already been determined

and upheld with finality. The same had been similarly

admitted by petitioner in her Complaint. It can be said, thus,

that respondents’ act of acquiring the subject property by

sale was not in violation of petitioner’s rights. The same can

also be said of the respondents’ objection to reimburse

petitioner. Simply, no correlative obligation exists on the part

of the


REPORTS

ANNOTATED

Ferrer vs. Ferrer

respondents to reimburse the petitioner. Corollary thereto,

neither can it be said that their refusal to reimburse

constituted a violation of petitioner’s rights. As has been

shown in the foregoing, no obligation by the respondents

under the law exists. Petitioner’s Complaint failed to state a

cause of action against the respondents, and for this reason,

the Court of Appeals was not in error in dismissing the same.

WHEREFORE, the Petition is DENIED. The Decision

dated 16 August 2004 and the Resolution dated 17 December

2004 of the Court of Appeals in CA-G.R. SP. No. 78525 are

AFFIRMED. Costs de oficio.

SO ORDERED.

Panganiban (C.J., Chairperson), Ynares-

Santiago, Austria-Martinezand Callejo, Sr., JJ., concur.

Petition denied, judgment and resolution affirmed.

Notes.—A spouse who desires to sell real property as such

administrator of the conjugal property must observe the

procedure for the sale of the ward’s estate required of judicial

guardians under Rule 95, 1964 Revised Rules of Court, not

the summary judicial proceedings under the Family Code.

(Uy vs. Court of Appeals, 346 SCRA 246 [2000])

In the enforcement of a writ of execution relative to a

judgment arising from a transaction of the husband which

did not redound to the benefit of the family, nor with her

consent, the wife is deemed a stranger to the action and is

justified in bringing an independent action to vindicate her

right of ownership over her separate property which is levied

upon. (Naguit vs. Court of Appeals, 347 SCRA 60[2000])

——o0o——

74

G.R. No. 140153. March 28, 2001.*

ANTONIO DOCENA and ALFREDA DOCENA,

petitioners, vs. HON. RICARDO P. LAPESURA, in his

capacity as Presiding Judge of the RTC, Branch III, Guian,

Eastern Samar; RUFINO M. GARADO, Sheriff IV; and

CASIANO HOMBRIA, respondents.

Actions; Certiorari;Pleadings and Practice; The retroactive

application of procedural laws, such as the Resolution in A.M. No.

00-03-SC, which amended Section 4 of Rule 65 of the 1997 Revised

Rules of Civil Procedure, is not violative of any right of a person

who may feel adversely affected thereby, as no vested right may

attach to nor arise from procedural laws.—In the case of iSystems

Factors Corporation versus NLRC, we held that the abovequoted

Resolution, being procedural in nature, is applicable to actions

pending and undetermined at the time of their passage. The

retroactive application of procedural laws such as this Resolution

is not violative of any right of a person who may feel adversely

affected thereby, as no vested right may attach to nor arise from

procedural laws. The ruling in the Systems Factors case was

reiterated in the recent case of Unity Fishing Development

Corporation, et al. vs. Court of Appeals, et al.Applying the

Resolution to the case at bar, the 60-day period for the filing of a

petition for certiorari and prohibition should be reckoned from the

date of receipt of the order denying the motion for

reconsideration, i.e., May 4, 1999, and thus, the filing made on

June 14, 1999 was well within the 60-day reglementary period.

Same; Same; Same;Certificate of Non-Forum Shopping; The

certificate of non-forum shopping should be signed by all the

petitioners or plaintiffs in a case, and that the signing by only one

of them is insufficient.—It has been our previous ruling that the

certificate of non-forum shopping should be signed by all the

petitioners or plaintiffs in a case, and that the signing by only one

of them is insufficient. In the case of Efren Loquias, et al. vs. Office

of the Ombudsman, et al.we held that the signing of the

Verification and the Certification on Non-Forum Shopping by only

one of the petitioners constitutes a defect in the petition. The

attestation contained in the certification on non-forum shopping

requires personal knowledge by the party executing the same, and

the lone signing petitioner cannot be presumed to have personal

knowledge of the filing or non-filing by his co-petitioners of any

action or claim the same as or similar to the current petition. To

merit the Court’s consideration, petitioners must show reasonable

cause for failure to personally sign the certification.

Same; Same; Same; Same;Husband and Wife; If suits to

defend an interest in the conjugal properties may be filed by the

husband alone, with more reason, he may sign the certificate of

non-forum shopping to be attached to the petition.—Under the New

Civil Code, the husband is the administrator of the conjugal

partnership. In fact, he is the sole administrator, and the wife is

not entitled as a matter of right to join him in this endeavor. The

husband may defend the conjugal partnership in a suit or action

without being joined by the wife. Corollarily, the husband alone

may execute the necessary certificate of non-forum shopping to

accompany the pleading. The husband as the statutory

administrator of the conjugal

660

6

60

SUPREME COURT

REPORTS

ANNOTATED

Docena vs. Lapesura

property could have filed the petition for certiorari and

prohibition alone, without the concurrence of the wife. If suits to

defend an interest in the conjugal properties may be filed by the

husband alone, with more reason, he may sign the certificate of

non-forum shopping to be attached to the petition.

Same; Same; Same; Same;Same; Family Code; It is believed

that even under the provisions of the Family Code, the husband

alone could file the petition for certiorari and prohibition to contest

the writs of demolition issued against the conjugal property without

being joined by his wife.—Under the Family Code, the

http://www.central.com.ph/sfsreader/session/0000015080c40802f9121e5a000a0094004f00ee/p/AKF932/?username=Guest#p355scra8960658001

75

administration of the conjugal property belongs to the husband

and the wife jointly. However, unlike an act of alienation or

encumbrance where the consent of both spouses is required, joint

management or administration does not require that the husband

and wife always act together. Each spouse may validly exercise full

power of management alone, subject to the intervention of the

court in proper cases as provided under Article 124 of the Family

Code. It is believed that even under the provisions of the Family

Code, the husband alone could have filed the petition for certiorari

and prohibition to contest the writs of demolition issued against

the conjugal property with the Court of Appeals without being

joined by his wife. The signing of the attached certificate of non-

forum shopping only by the husband is not a fatal defect.

Same; Same; Same; Same;Same; The husband may reasonably

be presumed to have personal knowledge of the filing or non-filing

by his wife of any action or claim similar to the petition for

certiorari and prohibition given the notices and legal processes

involved in a legal proceeding involving real property.—More

important, the signing petitioner here made the certification in his

behalf and that of his wife. The husband may reasonably be

presumed to have personal knowledge of the filing or non-filing by

his wife of any action or claim similar to the petition for certiorari

and prohibition given the notices and legal processes involved in a

legal proceeding involving real property. We also see no justifiable

reason why he may not lawfully undertake together with his wife

to inform the court of any similar action or proceeding which may

be filed. If anybody may repudiate the certification or undertaking

for having been incorrectly made, it is the wife who may

conceivably do so.

Same; Same; Same; Same;Same; In view of the circumstances

of the instant case, namely, the property involved is a conjugal

property, the petition questioning the writ of demolition thereof

originated from an action for recovery brought against the spouses,

and is clearly intended for the benefit of the conjugal partnership,

and the wife was in Samar whereas the

661

VOL. 355, MARCH

28, 2001

6

61

Docena vs. Lapesura

petition was prepared in Metro Manila, a rigid application of

the rules on forum shopping that would disauthorize a husband’s

signing the certification in his behalf and that of his wife is too

harsh and is clearly uncalled for.—In view of the circumstances of

this case, namely, the property involved is a conjugal property, the

petition questioning the writ of demolition thereof originated from

an action for recovery brought against the spouses, and is clearly

intended for the benefit of the conjugal partnership, and the wife,

as pointed out in the Motion for Reconsideration in respondent

court, was in the province of Guian, Samar, whereas the petition

was prepared in Metro Manila, a rigid application of the rules on

forum shopping that would disauthorize a husband’s signing the

certification in his behalf and that of his wife is too harsh and is

clearly uncalled for. It bears stressing that the rules on forum

shopping, which were designed to promote and facilitate the

orderly administration of justice, should not be interpreted with

such absolute literalness as to subvert its own ultimate and

legitimate objective.

PETITION for review on certiorari of the resolutions of the

Court of Appeals.


Zaldy B. Docena for petitioners.

Elvira De Vera Bitoniofor private respondents.

GONZAGA-REYES, J.:

This is a petition for review on certiorari under Rule 45 of the

Rules of Court seeking the nullification of the Court of

Appeals1 Resolutions dated June 18, 1999 and September 9,


76

1999 which dismissed the Petition for Certiorari and

Prohibition2 under Rule 65 and denied the corresponding

motion for reconsideration, respectively.

The antecedent facts are as follows:

On June 1, 1977, private respondent Casiano Hombria

filed a Complaint for the recovery of a parcel of land against

his lessees,

________________

1 Fourth Division composed of J.Salome A.

Montoya, ponente; and JJ.Conrado M. Vasquez and Teodoro P. Regino,

members.

2 Docketed as CA-G.R. SP No. 53211.


REPORTS

ANNOTATED

Docena vs. Lapesura

petitioner-spouses Antonio and Alfreda Docena.3 The

petitioners claimed ownership of the land based on

occupation since time immemorial.4 A certain Guillermo

Abuda intervened in the case. In a Decision dated November

24, 1989, the trial court ruled in favor of the petitioners and

the intervenor Abuda.5 On appeal, the Court of Appeals

reversed the judgment of the trial court and ordered the

petitioners “to vacate the land they have leased from the

plaintiff-appellant [private respondent Casiano Hombria],

excluding the portion which the petitioners reclaimed from the

sea and forms part of the shore, as shown in the

Commissioner’s Report, and to pay the plaintiff-appellant the

agreed rental of P1.00 per year from the date of the filing of

the Complaint until they shall have actually vacated the

premises.”6 The Complaint in Intervention of Abuda was

dismissed.7

On May 22, 1995, private respondent Hombria filed a

Motion for Execution of the above decision which has already

become final and executory.8 The motion was granted by the

public respondent judge, and a Writ of Execution was issued

therefor. However, the public respondent sheriff

subsequently filed a Manifestation requesting that he “be

clarified in the determination of that particular portion which

is sought to be excluded prior to the delivery of the land

adjudged in favor of plaintiff Casiano Hombria” in view of

the defects in the Commissioner’s Report and the Sketches

attached thereto.9 After requiring the parties to file their

Comment on the sheriffs Manifestation, the public

respondent judge, in a Resolution dated August 30, 1996,

held that “x x x no attempt should be made to alter or modify

the decision of the Court of Appeals. What should be delivered

therefore to the plaintiff x x x is that portion leased by the

defendant-appellees from the plaintiff-appellant excluding the

portion that the defendant-appellee have reclaimed

_______________

3 Petition, p. 4; Rollo, p. 11. The case was docketed as RTC (of Guian,

Eastern Samar, Branch 3) Civil Case No. 446.

4 Ibid.

5 Id.

6 Id.

7 Id.

8 Id.

9 Id., p. 6; Rollo, p. 13.

663 VOL. 355, MARCH 28,

2001

663

Docena vs. Lapesura

from the sea and forms part of the shore as shown in the

commissioner’s report x x x.”10Pursuant to the Resolution, the










77

public respondent sheriff issued an alias Writ of Demolition.

The petitioners filed a Motion to Set Aside or Defer the

Implementation of Writ of Demolition. This motion was

denied by the public respondent judge in an Order dated

November 18, 1998, a copy of which was received by the

petitioners on December 29, 1998.11 Also on December 29,

1998, the public respondent judge, in open court, granted the

petitioners until January 13, 1999 to file a Motion for

Reconsideration.12 On January 13, 1999, petitioners moved for

an extension of the period to file a motion for reconsideration

until January 28, 1999.13 The motion was finally filed by the

petitioners on January 27, 1999, but was denied by the trial

court in an Order dated March 17, 1999.14A copy of the Order

was received by the petitioners on May 4, 1999.15

A Petition for Certiorari and Prohibition was filed by the

petitioners with the Court of Appeals, alleging grave abuse of

discretion on the part of the trial court judge in issuing the

Orders dated November 18, 1998 and March 17, 1999, and of

the sheriff in issuing the aliasWrit of Demolition. In a

Resolution dated June 18, 1999, the Court of Appeals

dismissed the petition on the grounds that the petition was

filed beyond the 60-day period provided under Section 4 of

Rule 65 of the 1997 Revised Rules of Civil Procedure as

amended by Bar Matter No. 803 effective September 1, 1998,

and that the certification of non-forum shopping attached

thereto was signed by only one of the petitioners16 The Motion

for Reconsideration filed by the petitioners was denied by the

Court of Appeals in a Resolution dated September 9, 1999.17

Hence this petition.

______________

10 Id., p. 7; Rollo, p. 14.

11 Id.

12 Id., p. 8; Rollo, pp. 15 and 88.

13 Id.

14 Id.

15 Id.

16 Court of Appeals Resolution dated June 18, 18999, p. 1; Rollo, p. 32.

17 Court of Appeals Resolution dated September 9, 1999, pp. 1 to 2; Rollo,

pp. 35-36.


REPORTS

ANNOTATED

Docena vs. Lapesura

The sole issue in this case is whether or not the Court of

Appeals erred in dismissing the Petition for Certiorari and

Prohibition.

The petition is meritorious.

The Court of Appeals dismissed the Petition for Certiorari

upon the following grounds, viz.: (1) the petition was filed

beyond the 60-day period provided under Sec. 4, Rule 65 of

the 1997 Revised Rules of Civil Procedure as amended by Bar

Matter No. 803 effective September 1, 1998; and (2) the

certification of non-forum shopping was signed by only one of

the petitioners.

Upon the first ground, the Court of Appeals stated in its

Resolution dated June 18, 1999 that:

x x x the 60-day period is counted not from the receipt of the Order

denying their Motion for Reconsideration but from the date of

receipt of the Order of November 18, 1998 which was on December

29, 1998, interrupted by the filing of the Motion for

Reconsideration on January 27, 1999. The Motion for

Reconsideration was denied in an Order dated March 17, 1999

received by the petitioners on May 4, 1999. Counting the

remaining period, this petition should have been filed on June 4,

1999 but it was filed only on June 14, 1999 or ten (10) days beyond

the 60-day period computed in accordance with Bar Matter No.

803.








78

x x x x x x x x x18

The petitioners agree that the counting of the 60-day period

should commence on December 29, 1998, the date of the

receipt by the petitioners of the assailed trial court order,

interrupted by the filing of a motion for reconsideration on

January 27, 1999, and resume upon receipt by the petitioners

of the denial of the motion by the trial court on May 4, 1999;

however, the petitioners contend that from December 29,

1998 up to January 27, 1999, only the 15-day period allowed

for the filing of a motion for reconsideration19should be

deemed to have elapsed considering the grant by the trial

court of an extension of the period to file the motion until

January 13, 1999. Hence, on May 4, 1999, the petitioners still

had

________________

18 Supra, p. 1.

19 Under Section 1 of Rule 52 of the 1997 Revised Rules of Civil Procedure.

665 VOL. 355, MARCH 28,

2001

665

Docena vs. Lapesura

45 days to file a petition for certiorari and/or prohibition, and

the filing made on June 14, 1999 was timely.

We hold that the Petition for Certiorari and Prohibition

has been timely filed.

A.M. No. 00-2-03-SC, which took effect on September 1,

2000, amended Section 4 of Rule 65 of the 1997 Revised

Rules of Civil Procedure20 to provide thus:

SEC. 4. When and where petition filed.—The petition shall be filed

not later than sixty (60) days from notice of the judgment, order or

resolution. In case a motion for reconsideration or new trial is

timely filed, whether such motion is required or not, the sixty (60)

day period shall be counted from notice of the denial of said motion.

The petition shall be filed in the Supreme Court or, if it relates

to the acts or omissions of a lower court or of a corporation, board,

officer or person, in the Regional Trial Court exercising jurisdiction

over the territorial area as defined by the Supreme Court. It may

also be filed in the Court of Appeals whether or not the same is in

aid of its appellate jurisdiction, or in the Sandiganbayan if it is in

aid of its appellate jurisdiction. If it involves the acts or omissions

of a quasi-judicial agency, unless otherwise provided by law or

these rules, the petition shall be filed in and cognizable only by the

Court of Appeals.

No extension of time to file the petition shall be granted except

for compelling reason and in no case exceeding fifteen (15) days.

[Emphasis ours]

In the case of Systems Factors Corporation versus NLRC,21we

held that the abovequoted Resolution, being procedural in

nature, is applicable to actions pending and undetermined at

the time of their passage. The retroactive application of

procedural laws such as this Resolution is not violative of any

right of a person who may feel adversely affected thereby, as

no vested right may attach to nor arise from procedural

laws.22 The ruling in theSystems Factors case was reiterated

in the recent case of Unity Fishing Develop-

________________

20 As amended by the Resolution of July 21, 1998.

21 G.R. No. 143789, November 27, 2000, 346 SCRA 149.

22 Ibid., p. 5, citing Gregorio vs. Court of Appeals, 26 SCRA

229(1969); Tinio vs. Mina, 26 SCRA 512(1969); and Billiones vs. CIR, 14

SCRA 674 (1965).


REPORTS

ANNOTATED

Docena vs. Lapesura






79

ment Corporation, et al. vs. Court of Appeals, et al.23Applying

the Resolution to the case at bar, the 60-day period for the

filing of a petition for certiorari and prohibition should be

reckoned from the date of receipt of the order denying the

motion for reconsideration, i.e., May 4, 1999, and thus, the

filing made on June 14, 1999 was well within the 60-day

reglementary period.

Anent the ground that the certification of non-forum

shopping was signed by only one of the petitioners, it is the

contention of the petitioners that the same is sufficient

compliance with the requirements of Sections 1 and 2 of Rule

65 (Petition for Certiorari and Prohibition) in relation to

Section 3 of Rule 46 (Original Cases Filed in the Court of

Appeals). The petitioners argue that since they are spouses

with joint or indivisible interest over the alleged conjugal

property subject of the original action which gave rise to the

petition for certiorari and prohibition, the signing of the

certificate of non-forum shopping by only one of them would

suffice, especially considering the long distance they had to

travel just to sign the said certificate.24 Moreover, there is

substantial compliance with the Rules of Court where the

certification was signed by the husband who is the statutory

administrator of the conjugal property.25

It has been our previous ruling that the certificate of non-

forum shopping should be signed by all the petitioners or

plaintiffs in a case, and that the signing by only one of them

is insufficient. In the case of Efren Loquias, et al. vs. Office of

the Ombudsman, et al.26 we held that the signing of the

Verification and the Certification on Non-Forum Shopping by

only one of the petitioners constitutes a defect in the

petition.27 The attestation contained in the certifica-

_______________

23 G.R. No. 145415, February 2, 2001, 351 SCRA 140.

24 The spouses reside in Guian, Eastern Samar, and had to go to their

counsel in Manila just to sign the Verification/Certification of the petition.

[Reply, p. 4; Rollo, p. 125.]

25 Reply, p. 5; Rollo, p. 126.

26 G.R. No. 139396, August 15, 2000, 338 SCRA 62.

27 Ibid., p. 6. The petitioners in this case are local government officials of

San Miguel, Zamboanga del Sur, specifically, Mayor Efren Loquias, Vice

Mayor Antonio Din, Jr., and Sangguniang Bayan members Angelito Martinez

II, Lovelyn Biador and Gregorio Faciol.

667 VOL. 355, MARCH 28,

2001

667

Docena vs. Lapesura

tion on non-forum shopping requires personal knowledgeby

the party executing the same,28 and the lone signing

petitioner cannot be presumed to have personal knowledge of

the filing or non-filing by his co-petitioners of any action or

claim the same as or similar to the current petition. To merit

the Court’s consideration, petitioners must show reasonable

cause for failure to personally sign the certification.

In the case at bar, however, we hold that the subject

Certificate of Non-Forum Shopping signed by the petitioner

Antonio Docena alone should be deemed to constitute

substantial compliance with the rules.29There are only two

petitioners in this case and they are husband and wife. Their

residence is the subject property alleged to be conjugal in the

instant verified petition. The Verification/Certification on

Non-Forum Shopping30attached to the Petition for

______________

28 Ibid., see also Sps. Valentin Ortiz, et al. vs. Court of Appeals, G.R. No.

127393, December 4, 1998, p. 712, 299 SCRA 708.

29 Sections 1 and 2 of Rule 65; Section 3 of Rule 46; and Section 5 of Rule 7

of the 1997 Revised Rules of Civil Procedure.









80

30 The Verification/Certification provides, thus:

VERIFICATION/CERTIFICATION

I. Antonio Docena, of legal age, Filipino, after being duly sworn, hereby depose and

state that:

1. 1.I am one of the petitioners in the above entitled case;

2. 2.I and my co-petitioner wife caused the preparation of the above petition and

have read the same;

3. 3.All the material allegations contained are true and correct based on our

knowledge and based on official records. The annexes attached to the

petition are duplicate original copies or true copies of the pleadings filed

with Regional Trial Court or orders issued by the said court inCivil Case

No. 446.

4. 4.I further certify that I and my co-petitioner wife have not commenced any

other action or proceeding involving the same issues raised in this petition

in the Supreme Court, Court of Appeals, or any division thereof, or in any

other tribunal or quasi-judicial agency and to the best of our knowledge, no

such other action is pending therein.


REPORTS

ANNOTATED

Docena vs. Lapesura

Certiorari and Prohibition was signed only by the husband

who certified, inter alia, that he and his wife have not

commenced any other action or proceeding involving the

same issues raised in the petition in any court, tribunal or

quasi-judicial agency; that to the best of their knowledge no

such action is pending therein; and that he and his wife

undertake to inform the Court within five (5) days from

notice of any similar action or proceeding which may have

been filed.

The property subject of the original action for recovery is

conjugal. Whether it is conjugal under the New Civil Code or

the Family Code, a fact that cannot be determined from the

records before us, it is believed that the certificate on non-

forum shopping filed in the Court of Appeals constitutes

sufficient compliance with the rules on forum-shopping.

Under the New Civil Code, the husband is the

administrator of the conjugal partnership.31 In fact, he is the

sole administrator, and the wife is not entitled as a matter of

right to join him in this endeavor.32 The husband may defend

the conjugal partnership in a suit or action without being

joined by the wife.33 Corollarily, the

_______________

5. I and my co-petitioner wife undertake to inform this Honorable Court

within five (5) days from notice of any similar action or proceeding which may

have been filed.

IN WITNESS WHEREOF, I hereunto set my hand this 14th day of June

1999 at Metro Manila.

(Sgd.) ANTONIO DOCENA

Petitioner

31 Article 165 of the New Civil Code.

32 Ysasi vs. Fernandez, 23 SCRA 1079 (1968), at p. 1083; Tinitigan vs.

Tinitigan, 100 SCRA 619 (1980), at p. 631. It should be noted, however that

under the New Civil Code, although the husband is the administrator of the

conjugal partnership, he cannot alienate or encumber any real property of the

conjugal partnership without the wife’s consent, subject only to certain

exceptions specified in the law. [Heirs of Christina Ayuste vs. Court of

Appeals, 313 SCRA 493(1999), at p. 499.]

33 Vda. de Sta. Romana vs. Philippine Commercial and Industrial

Bank, 118 SCRA 330(1982), at pp. 334 to 335; G-Tractors, Inc. vs. Court of

Appeals, 135 SCRA 192 (1985), at p. 210; Stasa Incorporated vs. Court of

Appeals,182 SCRA 879 (1990).

669




81

VOL. 355, MARCH 28,

2001

669

Docena vs. Lapesura

husband alone may execute the necessary certificate of non-

forum shopping to accompany the pleading. The husband as

the statutory administrator of the conjugal property could

have filed the petition for certiorari and prohibition34 alone,

without the concurrence of the wife. If suits to defend an

interest in the conjugal properties may be filed by the

husband alone, with more reason, he may sign the certificate

of non-forum shopping to be attached to the petition.

Under the Family Code, the administration of the conjugal

property belongs to the husband and the wife

jointly.35 However, unlike an act of alienation or encumbrance

where the consent of both spouses is required, joint

management or administration does not require that the

husband and wife always act together. Each spouse may

validly exercise full power of management alone, subject to

the intervention of the court in proper cases as provided

under Article 124 of the Family Code.36 It is believed that

even

_______________

34 Neither this petition nor the original case filed with the regional trial

court involves the alienation, disposition or encumbrance of the conjugal

property.

35 Article 124 of the Family Code provides:

The administration and enjoyment of the conjugal partnership property shall belong to

both spouses jointly. In case of disagreement, the husband’s decision shall prevail,

subject to recourse to the court by the wife for proper remedy, which must be availed of

within five years from the date of the contract implementing such decision.

In the event that one spouse is incapacitated or otherwise unable to participate in

the administration of the conjugal properties, the other spouse may assume sole

powers of administration. These powers do not include disposition or encumbrance

without authority of the court or the written consent of the other spouse. In the

absence of such authority or consent, the disposition or encumbrance shall be void.

However, the transaction shall be construed as a continuing offer on the part of the

consenting spouse and the third person, and may be perfected as a binding contract

upon the acceptance by the other spouse or authorization by the court before the offer

is withdrawn by either or both offerors.

A similar provision is found in Article 96.

36 Arturo M. Tolentino,Commentaries and Jurisprudence on the Civil Code

of the Philippines, vol. I (1990), p. 393.


REPORTS

ANNOTATED

Docena vs. Lapesura

under the provisions of the Family Code, the husband alone

could have filed the petition for certiorari and prohibition to

contest the writs of demolition issued against the conjugal

property with the Court of Appeals without being joined by

his wife. The signing of the attached certificate of non-forum

shopping only by the husband is not a fatal defect.

More important, the signing petitioner here made the

certification in his behalf and that of his wife. The husband

may reasonably be presumed to have personal knowledge of

the filing or non-filing by his wife of any action or claim

similar to the petition for certiorari and prohibition given the

notices and legal processes involved in a legal proceeding

involving real property. We also see no justifiable reason why

he may not lawfully undertake together with his wife to

inform the court of any similar action or proceeding which

may be filed. If anybody may repudiate the certification or

undertaking for having been incorrectly made, it is the wife

who may conceivably do so.

In view of the circumstances of this case, namely, the

property involved is a conjugal property, the petition

questioning the writ of demolition thereof originated from an




82

action for recovery brought against the spouses, and is

clearly intended for the benefit of the conjugal partnership,

and the wife, as pointed out in the Motion for

Reconsideration in respondent court, was in the province of

Guian, Samar, whereas the petition was prepared in Metro

Manila, a rigid application of the rules on forum shopping

that would disauthorize a husband’s signing the certification

in his behalf and that of his wife is too harsh and is clearly

uncalled for.

It bears stressing that the rules on forum shopping, which

were designed to promote and facilitate the orderly

administration of justice, should not be interpreted with such

absolute literalness as to subvert its own ultimate and

legitimate objective.37

The petitioner’s motion for the issuance of a temporary

restraining order to put on hold the demolition of the subject

prop-

_______________

37 Kavinta vs. Castillo, Jr., 249 SCRA 604 (1995), at p. 608; Loyola vs.

Court of Appeals, 245 SCRA 477(1995), at p. 483; Gabionza vs. Court of

Appeals, 234 SCRA 192 (1994), at p. 198.

671 VOL. 355, MARCH 28,

2001

671

Docena vs. Lapesura

erty is principally anchored on their alleged right to the

nullification of the assailed orders and writs issued by the

public respondents.38 As the existence of the right being

asserted by the petitioners is a factual issue proper for

determination by the Court of Appeals, the motion based

thereon should likewise be addressed to the latter court.

WHEREFORE, premises considered, the petition is hereby

GRANTED. The Court of Appeals Resolutions dated June 18,

1999 and September 9, 1999 are hereby SET ASIDE and the

case is REMANDED to the Court of Appeals for further

proceedings.

SO ORDERED.

Melo (Chairman),Vitug, Panganiban andSandoval

Gutierrez, JJ.,concur.

Petition granted, resolutions set aside. Case remanded to

Court of Appeals.

Notes.—A party’s failure to state in the certificate of non-

forum shopping that he undertakes to inform the Court of

any petition which might be filed, as required under Revised

Circular No. 28-91, may be overlooked where it does not

appear that any petition related to the case has ever been

filed in any other court. (Cabardo vs. Court of Appeals, 290

SCRA 131 [1998])

Compliance with the certification against forum shopping

is separate from, and independent of, the avoidance of forum

shopping itself. (Melo vs. Court of Appeals, 318 SCRA

94 [1999])

The fact that a party was abroad when the petition for

certiorari was filed is a reasonable cause to exempt him from

compliance with the requirement that he personally execute

the certification on non-forum shopping. (Hamilton vs.

Levy,344 SCRA 821 [2000])

——o0o——



83

G.R. No. 147978. January 23, 2002.*

THELMA A. JADER-MANALO, petitioner, vs.NORMA

FERNANDEZ C. CAMAISA and EDILBERTO CAMAISA,

respondents.

Actions; Summary Judgment; A summary judgment is one

granted by the court upon motion by a party for an expeditious

settlement of a case, there appearing from the pleadings,

depositions, admissions and affidavits that there are no important

questions or issues of fact involved, and that therefore, the moving

party is entitled to judgment as a matter of law.—Petitioner alleges

that the trial court erred when it entered a summary judgment in

favor of respondent spouses there being a genuine issue of fact.

Petitioner maintains that the issue of whether the contracts to sell

between petitioner and respondent spouses was perfected is a

question of fact necessitating a trial on the merits. The Court does

not agree. A summary judgment is one granted by the court upon

motion by a party for an expeditious settlement of a case, there

appearing from the pleadings, depositions, admissions and

affidavits that there are no important questions or issues of fact

involved, and that therefore, the moving party is entitled to

judgment as a matter of law. A perusal of the pleadings submit-

______________

* FIRST DIVISION.

499

VOL. 374,

JANUARY 23, 2002

4

99

Jader-Manalo vs.

Camaisa

ted by both parties show that there is no genuine controversy

as to the facts involved therein.

Husband and Wife; Conjugal Property; The disposition of a

conjugal property by the husband as administrator in appropriate

cases must be with the written consent of the wife, otherwise, the

disposition is void.—The law requires that the disposition of a

conjugal property by the husband as administrator in appropriate

cases requires the written consent of the wife, otherwise, the

disposition is void. Thus, Article 124 of the Family Code provides:

Art. 124. The administration and enjoyment of the conjugal



recourse to the court by the wife for a proper remedy, which must

be availed of within five years from the date of the contract

implementing such decision. In the event that one spouse is


administration of the conjugal properties, the other spouse may

assume sole powers of administration. These powers do not include

the powers of disposition or encumbrance which must have the

authority of the court or the written consent of the other spouse. In

the absence of such authority or consent the disposition or

encumbrance shall be void. However, the transaction shall be

construed as a continuing offer on the part of the consenting

spouse and the third person, and may be perfected as a binding

contract upon the acceptance by the other spouse or authorization

by the court before the offer is withdrawn by either or both

offerers. (Italics ours.)

Same; Same; Even granting that the wife actively participated

in negotiating for the sale of the properties, her written consent to

the sale is required by law for its validity; Being merely aware of a

transaction is not consent.—Respondent Norma Camaisa

admittedly did not give her written consent to the sale. Even

granting that respondent Norma actively participated in

negotiating for the sale of the subject properties, which she denied,

her written consent to the sale is required by law for its validity.

Significantly, petitioner herself admits that Norma refused to sign

the contracts to sell. Respondent Norma may have been aware of

the negotiations for the sale of their conjugal properties. However,

being merely aware of a transaction is not consent.

http://www.central.com.ph/sfsreader/session/0000015080cb061fad9f4d8f000a0094004f00ee/p/AJT343/?username=Guest#p374scra8960498001

84

Same; Same; The court authorization under Article 124 of the

Family Code is only resorted to in cases where the spouse who does

not give consent is incapacitated.—Petitioner argues that since

respondent Norma unjustly refuses to affix her signatures to the

contracts to sell, court authorization under Article 124 of the

Family Code is warranted. The argument is bereft

500

5

00

SUPREME COURT

REPORTS

ANNOTATED

Jader-Manalo vs.

Camaisa

of merit. Petitioner 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 such

authority if the same is 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, petitioner failed to allege

and prove that respondent Norma was incapacitated to give her

consent to the contracts. In the absence of such showing of the

wife’s incapacity, court authorization cannot be sought.


of Appeals.


Thelma A. Jader-Manalo for and in her own behalf.

Jose R. Ebro, Jr., for private respondents.

KAPUNAN, J.:

The issue raised in this case is whether or not the husband

may validly dispose of a conjugal property without the wife’s

written consent.

The present controversy had its beginning when petitioner

Thelma A. Jader-Manalo allegedly came across an

advertisement placed by respondents, the Spouses Norma

Fernandez C. Camaisa and Edilberto Camaisa, in the

Classified Ads Section of the newspaper BULLETIN TODAY

in its April, 1992 issue, for the sale of their ten-door

apartment in Makati, as well as that in Taytay, Rizal.

As narrated by petitioner in her complaint filed with the

Regional Trial Court of Makati, Metro Manila, she was

interested in buying the two properties so she negotiated for

the purchase through a real estate broker, Mr. Proceso

Ereno, authorized by respondent spouses.1 Petitioner made a

visual inspection of the said lots with the real estate broker

and was shown the tax declarations, real property tax

payment receipts, location plans, and

______________

1 Paragraph IV of Complaint; Rollo, p. 61.


23, 2002

501

Jader-Manalo vs. Camaisa

vicinity maps relating to the properties.2 Thereafter,

petitioner met with the vendors who turned out to be

respondent spouses. She made a definite offer to buy the

properties to respondent Edilberto Camaisa with the

knowledge and conformity of his wife, respondent Norma

Camaisa in the presence of the real estate broker.3 After some

bargaining, petitioner and Edilberto agreed upon the

purchase price of P1,500,000.00 for the Taytay property and

P2,100,000.00 for the Makati property4 to be paid on

installment basis with downpayments of P100,000.00 and

P200,000.00, respectively, on April 15, 1992. The balance

thereof was to be paid as follows:5






85

Taytay

Property

Makati

Property

6th

month

P

200,000.00

P 300,000.00

12th

month

700,000.00 1,600,000.00

18th

month

500,000.00

This agreement was handwritten by petitioner and signed by

Ediberto.6 When petitioner pointed out the conjugal nature of

the properties, Edilberto assured her of his wife’s conformity

and consent to the sale.7 The formal typewritten Contracts to

Sell were thereafter prepared by petitioner. The following

day, petitioner, the real estate broker and Edilberto met in

the latter’s office for the formal signing of the typewritten

Contracts to Sell.8 After Edilberto signed the contracts,

petitioner delivered to him two checks, namely, UCPB Check

No. 62807 dated April 15, 1992 for P200,000.00 and UCPB

Check No. 62808 also dated April 15, 1992 for P100,000.00 in

the presence of the real estate broker and an

______________

2 Paragraph V of Complaint; id.

3 Paragraph VI of Complaint; id.

4 Paragraph VII of Complaint, id.,at p. 62.

5 Id.

6 The handwritten agreement was attached as Annex “E” to the

Complaint; Rollo, pp. 80-83.

7 Supra, Note 4.

8 Paragraph IX of Complaint; Rollo, p. 63.


REPORTS

ANNOTATED


employee in Edilberto’s office.9 The contracts were given to

Edilberto for the formal affixing of his wife’s signature.

The following day, petitioner received a call from

respondent Norma requesting a meeting to clarify some

provisions of the contracts.10To accommodate her queries,

petitioner, accompanied by her lawyer, met with Edilberto

and Norma and the real estate broker at Cafe Rizal in

Makati.11 During the meeting, handwritten notations were

made on the contracts to sell, so they arranged to incorporate

the notations and to meet again for the formal signing of the

contracts.12

When petitioner met again with respondent spouses and

the real estate broker at Edilberto’s office for the formal

affixing of Norma’s signature, she was surprised when

respondent spouses informed her that they were backing out

of the agreement because they needed “spot cash” for the full

amount of the consideration.13 Petitioner reminded

respondent spouses that the contracts to sell had already

been duly perfected and Norma’s refusal to sign the same

would unduly prejudice petitioner. Still, Norma refused to

sign the contracts prompting petitioner to file a complaint for

specific performance and damages against respondent

spouses before the Regional Trial Court of Makati, Branch

136 on April 29, 1992, to compel respondent Norma Camaisa

to sign the contracts to sell.

A Motion to Dismiss14 was filed by respondents which was

denied by the trial court in its Resolution of July 21, 1992.15

Respondents then filed their Answer with Compulsory

Counterclaim, alleging that it was an agreement between

herein petitioner and respondent Edilberto Camaisa that the

sale of the subject properties was still subject to the approval

and conformity of his

______________











86

9 Photocopies of these checks were attached as Annex “H” to the

Complaint; Rollo, pp. 90-92.

10 Paragraph XI of Complaint; Rollo, pp. 63-64.

11 Paragraph XII of Complaint; id.

12 Paragraph XIII of Complaint;id.

13 Paragraph XIX; id., pp. 64-65.

14 Rollo, pp. 107-110.

15 Id., at p. 143.


23, 2002

503


wife Norma Camaisa.16Thereafter, when Norma refused to

give her consent to the sale, her refusal was duly

communicated by Edilberto to petitioner.17 The checks issued

by petitioner were returned to her by Edilberto and she

accepted the same without any objection.18 Respondent

further claimed that the acceptance of the checks returned to

petitioner signified her assent to the cancellation of the sale

of the subject properties.19Respondent Norma denied that she

ever participated in the negotiations for the sale of the

subject properties and that she gave her consent and

conformity to the same.20

On October 20, 1992, respondent Norma F. Camaisa filed

a Motion for Summary Judgment21asserting that there is no

genuine issue as to any material fact on the basis of the

pleadings and admission of the parties considering that the

wife’s written consent was not obtained in the contract to

sell, the subject conjugal properties belonging to respondents;

hence, the contract was null and void.

On April 14, 1993, the trial court rendered a summary

judgment dismissing the complaint on the ground that under

Art. 124 of the Family Code, the court cannot intervene to

authorize the transaction in the absence of the consent of the

wife since said wife who refused to give consent had not been

shown to be incapacitated. The dispositive portion of the trial

court’s decision reads:

WHEREFORE, considering these premises, judgment is hereby

rendered:

1. 1.Dismissing the complaint and ordering the cancellation of

the Notice of Lis Pendens by reason of its filing on TCT

Nos. (464860) S-8724 and (464861) S-8725 of the Registry

of Deeds at Makati and on TCT Nos. 295976 and 295971 of

the Registry of Rizal.

______________

16 Paragraph XI of Answer with Compulsory Counterclaim, id., p. 95.

17 Paragraph XIII, id.

18 Id.

19 Id.

20 Paragraphs 2 and 3 of the Answer with Compulsory Counterclaim; id. at

93-94.

21 Rollo, p. 186.


REPORTS

ANNOTATED


1. 2.Ordering plaintiff Thelma A. Jader to pay defendant

spouses Norma and Edilberto Camaisa, FIFTY

THOUSAND (P50,000.00) as Moral Damages and FIFTY

THOUSAND (P50,000.00) as Attorney’s Fees.

Costs against plaintiff.22

Petitioner, thus, elevated the case to the Court of Appeals.

On November 29, 2000, the Court of Appeals affirmed the








87

dismissal by the trial court but deleted the award of

P50,000.00 as damages and P50,000.00 as attorney’s fees.

The Court of Appeals explained that the properties subject

of the contracts were conjugal properties and as such, the

consent of both spouses is necessary to give effect to the sale.

Since private respondent Norma Camaisa refused to sign the

contracts, the sale was never perfected. In fact, the

downpayment was returned by respondent spouses and was

accepted by petitioner. The Court of Appeals also stressed

that authority of the court to allow sale or encumbrance of a

conjugal property without the consent of the other spouse is

applicable only in cases where the said spouse is


administration of the conjugal property.

Hence, the present recourse assigning the following errors:

THE HONORABLE COURT OF APPEALS GRIEVOUSLY

ERRED IN RENDERING SUMMARY JUDGMENT IN

DISMISSING THE COMPLAINT ENTIRELY AND ORDERING

THE CANCELLATION OF NOTICE OF LIS PENDENS ON THE

TITLES OF THE SUBJECT REAL PROPERTIES;


ERRED IN FAILING TO CONSIDER THAT THE SALE OF REAL

PROPERTIES BY RESPONDENTS TO PETITIONER HAVE

ALREADY BEEN PERFECTED, FOR AFTER THE LATTER

PAID P300,000.00 DOWNPAYMENT, RESPONDENT MRS.

CAMAISA NEVER OBJECTED TO STIPULATIONS WITH

RESPECT TO PRICE, OBJECT AND TERMS OF PAYMENT IN

THE CONTRACT TO SELL ALREADY SIGNED BY THE

PETITIONER, RESPONDENT MR. CAMAISA AND WITNESSES

MARKED AS ANNEX “G” IN THE COMPLAINT EXCEPT, FOR

MINOR PROVISIONS ALREADY IMPLIED BY LAW, LIKE

EJECTMENT OF

______________

22 Annex “Q,” p. 3; Rollo, pp. 224-225.


23, 2002

505


TENANTS, SUBDIVISION OF TITLE AND RESCISSION IN

CASE OF NONPAYMENT, WHICH PETITIONER READILY

AGREED AND ACCEDED TO THEIR INCLUSION;


ERRED WHEN IT FAILED TO CONSIDER THAT CONTRACT

OF SALE IS CONSENSUAL AND IT IS PERFECTED BY THE

MERE CONSENT OF THE PARTIES AND THE APPLICABLE

PROVISIONS ARE ARTICLES 1157, 1356, 1357, 1358, 1403, 1405

AND 1475 OF THE CIVIL CODE OF THE PHILIPPINES AND

GOVERNED BY THE STATUTE OF FRAUD.23

The Court does not find error in the decisions of both the trial

court and the Court of Appeals.

Petitioner alleges that the trial court erred when it

entered a summary judgment in favor of respondent spouses

there being a genuine issue of fact. Petitioner maintains that

the issue of whether the contracts to sell between petitioner

and respondent spouses was perfected is a question of fact

necessitating a trial on the merits.

The Court does not agree. A summary judgment is one

granted by the court upon motion by a party for an

expeditious settlement of a case, there appearing from the

pleadings, depositions, admissions and affidavits that there

are no important questions or issues of fact involved, and

that therefore the moving party is entitled to judgment as a

matter of law.24 A perusal of the pleadings submitted by both

parties show that there is no genuine controversy as to the

facts involved therein.

Both parties admit that there were negotiations for the

sale of four parcels of land between petitioner and

respondent spouses; that petitioner and respondent Edilberto



88

Camaisa came to an agreement as to the price and the terms

of payment, and a downpayment was paid by petitioner to

the latter; and that respondent Norma refused to sign the

contracts to sell. The issue thus posed for resolution in the

trial court was whether or not the contracts to sell between

petitioner and respondent spouses were already per-

______________

23 Rollo, p. 23.

24 271 SCRA 36 (1997).


REPORTS

ANNOTATED


fected such that the latter could no longer back out of the

agreement.

The law requires that the disposition of a conjugal

property by the husband as administrator in appropriate

cases requires the written consent of the wife, otherwise, the

disposition is void. Thus, Article 124 of the Family Code

provides:

Art. 124. The administration and enjoyment of the conjugal



recourse to the court by the wife for a proper remedy, which must

be availed of within five years from the date of the contract

implementing such decision.

In the event that one spouse is incapacitated or otherwise

unable to participate in the administration of the conjugal

properties, the other spouse may assume sole powers of

administration. These powers do not include the powers of

disposition or encumbrance which must have the authority of the

court or the written consent of the other spouse. In the absence of

such authority or consent the disposition or encumbrance shall be

void. However, the transaction shall be construed as a continuing

offer on the part of the consenting spouse and the third person,

and may be perfected as a binding contract upon the acceptance by

the other spouse or authorization by the court before the offer is

withdrawn by either or both offerers. (Italics ours.)

The properties subject of the contracts in this case were

conjugal; hence, for the contracts to sell to be effective, the

consent of both husband and wife must concur.

Respondent Norma Camaisa admittedly did not give her

written consent to the sale. Even granting that respondent

Norma actively participated in negotiating for the sale of the

subject properties, which she denied, her written consent to

the sale is required by law for its validity. Significantly,

petitioner herself admits that Norma refused to sign the

contracts to sell. Respondent Norma may have been aware of

the negotiations for the sale of their conjugal properties.

However, being merely aware of a transaction is not

consent.25

______________

25 Tinitigan vs. Tinitigan, 100 SCRA 619 (1980).


23, 2002

507


Finally, petitioner argues that since respondent Norma

unjustly refuses to affix her signatures to the contracts to

sell, court authorization under Article 124 of the Family Code

is warranted.

The argument is bereft of merit. Petitioner 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 such authority if the


89

same is 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.26

In this case, petitioner failed to allege and prove that

respondent Norma was incapacitated to give her consent to

the contracts. In the absence of such showing of the wife’s

incapacity, court authorization cannot be sought.

Under the foregoing facts, the motion for summary

judgment was proper considering that there was no genuine

issue as to any material fact. The only issue to be resolved by

the trial court was whether the contract to sell involving

conjugal properties was valid without the written consent of

the wife.

WHEREFORE, the petition is hereby DENIED and the

decision of the Court of Appeals dated November 29, 2000 in

CA-G.R. CV No. 43421 is AFFIRMED.

______________

26 Commentaries and Jurisprudence on the Civil Code of the Philippines,

Arturo Tolentino, Vol. I, p. 461 citing the case of Nicolas vs. Court of

Appeals, 154 SCRA 635 (1987) which held that:

“. . . the very conspicuous absence of the wife’s conforme to such

disposition of the ganancial property, there being no showing that Lourdes

Manuel, whom respondent Madlangsakay married in 1927, is legally

incapacitated—renders the alleged sale void ab initio because it is in

contravention of the mandatory requirement in Article 166 of the Civil Code.

This doctrine is too well-settled in our jurisprudence to require further

elucidation.”

See also p. 392 of Tolentino’s Commentaries relating to an identical

provision, Art. 96 of the Civil Code, on community property. Tolentino writes:

“As a result of this joint ownership, neither spouse may alienate or

encumber any common property without the written consent of the other, or,

if the other spouse is incapacitated, the authorization of the court.”


REPORTS

ANNOTATED

Casano vs. Magat

SO ORDERED.

Davide, Jr. (C.J.,

Chairman), Puno, Pardo andYnares-Santiago, JJ., concur.

Petition denied, judgment affirmed.

Notes.—A motion for summary judgment is premised on

the assumption that a scrutiny of the facts will disclose that

the issues presented need not be tried either because these

are patently devoid of substance or that there is no genuine

issue as to any pertinent fact—it is a method sanctioned by

the Rules of Court for prompt disposition of a civil action

where there exists no serious controversy. (Raboca vs.

Velez, 341 SCRA 543 [2000])

It is axiomatic under the law on procedure that a

summary judgment is a final disposition in a legal suit which

can be rectified by means of an appeal therefrom. (Aqualyn

Corporation vs. Court of Appeals, 214 SCRA 307[1992])

——o0o——


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