Title 4: Property Relations Between Husband and Wife; Arts 74-148

Chapter 1: General Provisions

Article 74: The property relations between husband and wife shall be governed in the following order:

1. By marriage settlements executed before the marriage;

2. By the provisions of this Code; and
3. By the local customs. (118)

Article 75: The future spouses may, in the marriage settlements, agree upon the regime of absolute
community, conjugal partnership of gains, complete separation of property, or any other regime. In the
absence of a marriage settlement, or when the regime agreed upon is void, the system of absolute
community of property as established in this Code shall govern

Presumption that Spouses are Governed by Absolute Community

- General rule
o If there is no agreement between the husband and wife, the property relationship
between them is absolute community of property
 Rule is also applicable if the regime agreed upon is found to be void

Kinds of Property Regimes

- Absolute Community
- Conjugal Partnership
o Separate ownership
o Only profits/income made from property are shared
- Complete Separation of Property
- Dowry System
o Where the wife would bring in property to help the husband in supporting the family
o Subject to the condition that at the end of the marriage, the property or its value shall be
returned

When Marriage Settlement must be Made

- Must be made before the celebration of the marriage

o Modifications after the celebration may be valid but only when authorized by law (Arts
76 and 77)

Article 76: In order that any modification in the marriage settlements may be valid, it must be made before
the celebration of the marriage, subject to the provisions of Articles 66, 67, 128, 135 and 136.

Article 77: The marriage settlements and any modification thereof shall be in writing, signed by the parties
and executed before the celebration of the marriage. They shall not prejudice third persons unless they
are registered in the local civil registry where the marriage contract is recorded as well as in the proper
registries of property.
When Settlements may be Changed

- General Rule
o Parties cannot change/modify their property relationship during the marriage
 Must be made before the celebration
 Any agreement to the contrary is void
o Quintana v. Lerma
o Tim v. Del Rio
- Exceptions
o Art 66 – Legal Separation
 In case of reconciliation, property relationship may be revived or modified
o Art 67 – Requirements and Execution of revival of property regime
 Executed under oath
 Specifies:
 The properties to be contributed anew to the restored regime
 Those to be retained as separate properties of each spouse
 The names of all their known creditors, their addresses and the amounts
owing to each
 Agreement of revival is filed in court and must be approved
o Article 128 – Judicial Separation of Property
 A spouse without just cause abandons another
o Art 135 – Grounds for Judicial Separation
 That the spouse of the petitioner has been sentenced to a penalty which carries
with it: civil interdiction
 That the spouse of the petitioner has been judicially declared an absentee
 That loss of parental authority of the spouse of petitioner has been decreed by
the court;
 That the spouse of the petitioner has abandoned the latter or failed to comply
with his or her obligations to the family as provided for in Article 101
 That the spouse granted the power of administration in the marriage settlements
has abused that power
 That at the time of the petition, the spouses have been separated in fact for at
least one year and reconciliation is highly improbable.
o Art 136
 Spouses may jointly file a petition for voluntary dissolution of:
 Absolute community
 Conjugal partnership
 Parties must first go to court and secure authority to agree on separation of
properties
 Changes are result of a principal action
 E.g. spouse files a suit for legal separation, a spouse has been living
separately for more than 1 year
Article 78: A minor who according to law may contract marriage may also execute his or her marriage
settlements, but they shall be valid only if the person designated in Article 14 to give consent to the
marriage are made parties to the agreement, subject to the provisions of Title IX of this Code.

Article 79: For the validity of any marriage settlement executed by a person upon whom a sentence of
civil interdiction has been pronounced or who is subject to any other disability, it shall be indispensable
for the guardian appointed by a competent court to be made a party thereto.

Article 78 No Longer Applies

- Repealed by RA No 6809 “An Act Lowering the Age of Majority From 21 to 18 Years, Amending
for the Purpose E.O. No 209, and for other Purposes”
- No minor can get married
o Marriages would be void for minors
- Civil Interdiction or Civil Death is merely a restriction on capacity to act (Art 38 CC)
o Civil interdiction – Art 34 RPC
 Civil interdiction shall deprive the offender during the time of his sentence of the
rights of parental authority or guardianship, either as to the person or property
of any ward, or marital authority, of the right to dispose of such property by an
act or any conveyance inter vivos
o Those with civil interdiction, pronounced with other disabilities, are required by law to
have a guardian appointed to them by a court of competent jurisdiction
 Guardian needed for consent to marriage settlement
o Those under civil interdiction cannot execute a document inter vivos
 But they may do so mortis causa

Article 80: In the absence of a contrary stipulation in a marriage settlement, the property relations of the
spouses shall be governed by Philippine laws, regardless of the place of the celebration of the marriage
and their residence

This rule shall not apply:

1. Where both spouses are aliens

2. With respect to the extrinsic validity of contracts affecting property not situated in the Philippines
and executed in the country where the property is located
3. With respect to the extrinsic validity of contracts entered into in the Philippines but affecting
property situated in a foreign country whose laws require different formalities for its extrinsic
validity.

Law that Governs Property Relations

- National Law principle

o The law applies if the spouses are living in the Philippines or abroad
  Even if property is abroad
 Even if celebrated abroad

Exceptions

- Paragraphs 2 and 3 are applications of lex situs

o Lex Situs
 Applicable law is based on the location of the subject/object

Article 81: Everything stipulated in the settlements or contracts referred to in the preceding articles in
consideration of a future marriage, including donations between the prospective spouses made therein,
shall be rendered void if the marriage does not take place. However, stipulations that do not depend upon
the celebration of the marriage shall be valid.

General Rule

- If the marriage does not take place, all stipulations are void
o Otherwise there would be unjust enrichment of the parties
o E.g. of stipulation: a natural child may be recognized
- Art 88
o Absolute community starts only when the marriage is celebrated

Chapter 2: Donations by Reason of Marriage

Article 82: Donations by reason of marriage are those which are made before its celebration, in
consideration of the same, and in favor of one or both of the future spouses.

Article 83: These donations are governed by the rules on ordinary donations established in Title III of Book
III of the Civil Code, insofar as they are not modified by the following articles.

Requisites of Donations Propter Nutias

- They must be made before the celebration of the marriage

- They must be made in consideration of the marriage
- They must be made in favor of one or both of the future spouses

Note

- Art 87
o Spouses cannot donate on grant gratuitous marriage, direct or indirect, during the
existence of the marriage, except moderate gifts which the spouses may give during
family celebrations or rejoicings.
- Art 92
o If made to only one of the spouses, the same belongs to him/ her as exclusive property,
except if the donor provides that it shall form part of the absolute community of
properties
- Donations propter nuptias are governed by Statute of Frauds in Art 1403 CC
 o To be enforceable, donations must appear in writing
 May be in private writing between spouses

Article 84: If the future spouses agree upon a regime other than the absolute community of property,
they cannot donate to each other in their marriage settlements more than one-fifth of their present
property. Any excess shall be considered void.

Donations of future property shall be governed by the provisions on testamentary succession and the
formalities of wills.

Limitations on Donations Prior to Marriage

- If spouses are under absolute community

o There is no limit in donations by either spouse
o Art 92
 Donations are placed in common fund
- If spouses are under Conjugal partnership, complete separation of properties, or dowry system
o Limit of donations is set to 1/5 of their present property

Article 85: Donations by reason of marriage of property subject to encumbrances shall be valid. In case of
foreclosure of the encumbrance and the property is sold for less than the total amount of the obligation
secured, the donee shall not be liable for the deficiency. If the property is sold for more than the total
amount of said obligation, the donee shall be entitled to the excess.

Rules on Encumbered Donated Property

- They will still be valid even if encumbered

- Encumbrances (e.g. mortgages) will not make the donee liable for the deficiency of the donation
- The one who gives the donation is entitled to excesses of the property if it is sold for more than
its value

Article 86: A donation by reason of marriage may be revoked by the donor in the following cases:

1. If the marriage is not celebrated or judicially declared void ab initio except donations made in the
marriage settlements, which shall be governed by Article 81
2. When the marriage takes place without the consent of the parents or guardian, as required by
law
3. When the marriage is annulled, and the donee acted in bad faith
4. Upon legal separation, the donee being the guilty spouse
5. If it is with a resolutory condition and the condition is complied with
6. When the donee has committed an act of ingratitude as specified by the provisions of the Civil
Code on donations in general
Paragraph 1:

- The celebration of the marriage is a condition sine qua non for the validity of a donation propter
nuptias
- The donation may either be made by one spouse in favor of the other. It may be made by a
stranger.
o If the donation is made by a stranger, the action for revocation may be brought under the
ordinary rules on prescription since the Family Code is silent about it. Hence, if the
donation is in writing, it must be brought within ten (10) years under paragraph 1, Article
1144 of the New Civil Code. If oral, it must be brought within 6 years

Paragraph 6

- Governed by Art 765 CC

o If the donee should commit some offense against the person, the honor, or the property
of the donor, or of his wife or children under his parental authority
o If the donee imputes to the donor any criminal offense, or any act involving moral
turpitude, even though he should prove it, unless the crime or the act has been
committed against the donee himself, his wife or children under his authority
o If he unduly refuses him support when the donee is legally or morally bound to give
support to the donor.

Article 87: Every donation or grant of gratuitous advantage, direct or indirect, between the spouses during
the marriage shall be void, except moderate gifts which the spouses may give each other on the occasion
of any family rejoicing. The prohibition shall also apply to persons living together as husband and wife
without a valid marriage

General Rule

- Husband and wife cannot donate to each other during the marriage
o Only before
o Reason is being for public policy
 To prevent the weaker spouse from being influence by the other
 To protect creditors from fraud
o This rule also applies to common law relationships
 Buenaventura v. Bautista
 Matabuena v. Cervantes
 Alvarez v. Espiritu
o Cohabitation is required for this rule to apply
 Arcaba v. Tabancura
- Spouses cannot sell property to each other
o Except
 Where a separation of property was agreed upon in the marriage settlements
 When there is a judicial separation of property (Art 1490 CC)
o Reason for law in prohibiting universal partnership is
 Giving an illegal donation
 To prevent spouse from leasing property to each other (Art 1646 CC)
Exceptions

- Spouse may only give in gratuitous advantage during family rejoicings, birthdays, anniversaries,
Christmas, etc.
o These “moderate” gifts may be moderate to someone, but excessive or less to others
 Subjective
- Making a spouse a beneficiary of insurance
o Insurance benefits are considered donations but may be freely given to another spouse
 Gercio v. Sunlife

People Who Can Question Donations

- The State or Bureau of Internal Revenue

o They possess the legal personality to question any donation or sale between husband and
wife
 Harding v. Com Union Assurance
o
- If a person has no relation to the property’s sale or transfer, they cannot question it
o No stranger may question donations

Chapter 3: System of Absolute Community

Section 1: General Provisions

Article 88: The absolute community of property between spouses shall commence at the precise moment
that the marriage is celebrated. Any stipulation, express or implied, for the commencement of the
community regime at any other time shall be void.

When Absolute Community Begins

- It starts exactly at the moment when the marriage is celebrated

Article 89: No waiver of rights, interests, shares and effects of the absolute community of property during
the marriage can be made except in case of judicial separation of property

When the waiver takes place upon a judicial separation of property, or after the marriage has been
dissolved or annulled, the same shall appear in a public instrument and shall be recorded as provided in
Article 77. The creditors of the spouse who made such waiver may petition the court to rescind the waiver
to the extent of the amount sufficient to cover the amount of their credits.

Changes in Property Relationship

- During the marriage, no changes in property relationship will be entertained

- Modifications for property relationship must be done before the marriage celebration
- Any modifications done are void
o Unless permitted by judicial action
Modifications Includes Waivers

- Waivers of rights, shares, interests, and effects of absolute community

- The waiver refers to the share of one spouse only
o Waiver must be refer to judicial separation of properties
- The waiver must be recorded in the local civil registry and registries of property
o For binding 3rd persons
o To be a public instrument

Article 90: The provisions on co-ownership shall apply to the absolute community of property between
the spouses in all matters not provided for in this Chapter.

Provisions on Co-ownership Apply in Cases of Common-Law Relationships or Void Marriages

- Valdez v. RTC
o Property relationship will be co-ownership
 In marriages void ab initio, declaration of nullity or psychological incapacity
o Dissolution/distribution of properties are based on law on co-ownership
- Agaypay v. CA
o Rule for co-ownership to apply in void marriages
 There must be proof of actual contribution
o Upon dissolution of relationship, properties are divided in proportion to contributions
o For common-law cohabitation
 Even if one spouse did not materially contribute but spiritually contributed
 They are entitled to ½ of shares
 Spiritual Contribution
 E.g. taking care of children at the house, attending to needs of family

Section 2: What Constitutes Community Property

Article 91: Unless otherwise provided in this Chapter or in the marriage settlements, the community
property shall consist of all the property owned by the spouses at the time of the celebration of the
marriage or acquired thereafter.

Kinds of Properties under Absolute Community

- All properties owned by the spouses at the time of the celebration of the marriage
- All properties acquired after the celebration of the marriage
- Excluded properties are found in Art 92

Custom of Majority of Filipino Families

- Husband and wife are considered co-owners of all properties

Article 92: The following shall be excluded from the community property:
 1. Property acquired during the marriage by gratuitous title by either spouse, and the fruits as well
as the income thereof, if any, unless it is expressly provided by the donor, testator or grantor that
they shall form part of the community property
2. Property for the personal and exclusive use of either spouse. However, jewelry shall form part of
the community property
3. Property acquired before the marriage by either spouse who has legitimate descendants by a
former marriage, and the fruits as well as the income, if any, of such property

Exclusive Properties of the Spouses

- Law enumerates the 3 properties exclusively owned by each spouse

Paragraph 1: Property Acquired by Gratuitous Title

- Gratuitous property consists of:

o A property donated by a 3rd person to a specific spouse during marriage
o Property inherited by a specific spouse from parents during the marriage
- This rule is not absolute
o The donor/grantor must provide a deed of donation/will

Paragraph 2: Property for Personal and Exclusive Use

- Personal/exclusive properties
o E.g. shoes, stockings, perfumes, etc.
- Exception:
o Jewelry
 Because of its value

Paragraph 3: Property Acquired before the Marriage…

- If a spouse had a previous marriage with legitimate descendants

o Property and fruits acquired during the previous marriage are exclusive to that spouse
- To protect the legitime or interest of the children in the previous marriage

Article 93: Property acquired during the marriage is presumed to belong to the community, unless it is
provided that it is one of those excluded therefrom.

Further Emphasis on the Rule of Absolute Community

- Properties acquired during the marriage form part of their absolute community of properties

Section 3: Charges Upon and Obligations of the Absolute Community

Article 94: The absolute community of property shall be liable for:

 1. The support of the spouses, their common children, and legitimate children of either spouse;
however, the support of illegitimate children shall be governed by the provisions of this Code on
Support
2. All debts and obligations contracted during the marriage by the designated administrator-spouse
for the benefit of the community, or by both spouses, or by one spouse with the consent of the
other
3. Debts and obligations contracted by either spouse without the consent of the other to the extent
that the family may have been benefited
4. All taxes, liens, charges and expenses, including major or minor repairs, upon the community
property;
5. All taxes and expenses for mere preservation made during marriage upon the separate property
of either spouse used by the family
6. Expenses to enable either spouse to commence or complete a professional or vocational course,
or other activity for self-improvement
7. Ante-nuptial debts of either spouse insofar as they have redounded to the benefit of the family;
8. in favor of their common legitimate children for the exclusive purpose of commencing or
completing a professional or vocational course or other activity for self-improvement
9. Ante-nuptial debts of either spouse other than those falling under paragraph (7) of this Article,
the support of illegitimate children of either spouse, and liabilities incurred by either spouse by
reason of a crime or a quasi-delict. In case of absence or insufficiency of the exclusive property of
the debtor-spouse, the payment of which shall be considered as advances to be deducted from
the share of the debtor-spouse upon liquidation of the community
10. Expenses of litigation between the spouses unless the suit is found to be groundless

If the community property is insufficient to cover the foregoing liabilities, except those falling under
paragraph (9), the spouses shall be solidarily liable for the unpaid balance with their separate properties.

Paragraph 1: Support for the Family

- Reason is found in Art 195

o Requires the spouses and the children (legitimate or illegitimate) to support each other
- Support may comprise of anything indispensable for
o Sustenance, dwelling, medical, education, transportation, keeping financial capacity
o Rule on education applies even to non-minors
o Transportation includes expenses going to and from work/school (Art 194)
- For illegitimate children:
o Support must come from the separate property of each spouse
o If support from separate property is insufficient, absolute community of property will step
in for support, but shares are deducted (Art 197)
- All debts contracted by a spouse without consent to the other are chargeable on the absolute
community.

Ante-nuptial Debts

- Debts contracted and haven’t been paid for before the marriage but redounded
 o Must be paid for by absolute community if the subject of debt is introduced into the
marriage
- Debts that didn’t redound to the benefit of the family
o Will not be covered by absolute community
o If the spouse has no separate property to pay for the debt
 Absolute community will be used to pay
 Share of that spouse, however, will be deducted
- If a spouse is held civilly liable for a quasi-delict or crime
o And the spouse has no separate property to pay
 Conjugal partnership or absolute community will be used to pay
 Shares will also be deducted

Article 95: Whatever may be lost during the marriage in any game of chance, betting, sweepstakes, or
any other kind of gambling, whether permitted or prohibited by law, shall be borne by the loser and shall
not be charged to the community but any winnings therefrom shall form part of the community property.

Gambling

- Never allowed by law

- Losses due to gambling will solely be answered for by the spouse’s exclusive properties.
- Winnings of the spouse will become a part of absolute community

Section 4: Ownership, Administration, Enjoyment and Disposition of the Community Property

Artilce 96: The administration and enjoyment of the community 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 common properties, the other spouse may assume sole powers of administration. These powers do
not include the powers of disposition or encumbrance without authority of the court or the written
consent of the 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.

Rules on Join Administration

- Jointly
- In case of disagreement, husband’s decision prevails
o Wife may question the decision in court within 5 years from the date of contract
implementing the decision
- Civil Code does not provide rules for joint administration
- This rule is for the recognition of equality of spouses and their interests in the properties
When a Spouse may Assume Sole Power of Administration

- In instances where
o One spouse is incapacitated
o One spouse is unable to participate in the administration of common property
- Power of administrator does not include power to sell community properties
o Court authorization or written consent of the other spouse is required
 Nicolas v. CA
 Mere awareness of the sale is not consent
 Tinitigan v. Tinitigan
o Even if the sale was void, it is a continuing offer between the consenting spouse and 3rtd
person
 Sale may be perfected as binding once the other spouse consents and accepts; or
by court authorization
 Before the offer is withdrawn
- Spouses are free to agree which one of them may administer absolute community of properties
o Agreement is valid and binding
o However, this power does not include power to encumber without court authority or
spouse’s written consent
 If the spouse leases an absolute community property beyond 1 year, it requires
consent of the other spouse because it is an encumbrance
 Roxas v. CA GR 92245 June 1991
o Concept of encumbrance includes lease

Article 97: Either spouse may dispose by will of his or her interest in the community property.

General Rule on Disposition of Share

- A spouse cannot dispose of share on properties not yet known to the other
o Cannot be considered as non-existing property since the share exists
 In this case, transmission of rights of ownership are merely suspended
- Co-owners cannot claim to be owners of specific portions of property
o They may only claim the shared parts

Reason for this Law

- Willing disposition of interest/share is an act of ownership

o An attribute of ownership is the right to dispose

Article 98: Neither spouse may donate any community property without the consent of the other.
However, either spouse may, without the consent of the other, make moderate donations from the
community property for charity or on occasions of family rejoicing or family distress.

Authorization for Disposition of Shares

- Spouses may dispose of their share

- Spouses may not donate any shared property without consent of the other
o Only “moderate” donations for charity or family occasions don’t require consent
 - Article 98 prohibits the donations of community property while article 97 allows it.

Section 5: Dissolution of Absolute Community Regime

Article 99: The absolute community terminates:

1. Upon the death of either spouse

2. When there is a decree of legal separation;
3. When the marriage is annulled or declared void
4. In case of judicial separation of property during the marriage under Articles 134 to 138.

Termination of Community Property

- Adolfo Aenlle v. Maria Rheims et al.

o Termination of community property must be registered
 So that 3rd persons may not be prejudiced
o In case a 3rd person makes a purchase
 It must be done for value and in good faith to be protected
 Any action filed must be against the surviving spouse who made the sale

Effect on Legal Separation

- Termination of community property is a consequence of legal separation

o If parties reconcile, they are free to revive the property regime or make a new one
- Modes of termination are exclusive in nature

Article 100: The separation in fact between husband and wife shall not affect the regime of absolute
community except that:

1. The spouse who leaves the conjugal home or refuses to live therein, without just cause, shall not
have the right to be supported
2. When the consent of one spouse to any transaction of the other is required by law, judicial
authorization shall be obtained in a summary proceeding
3. In the absence of sufficient community property, the separate property of both spouses shall be
solidarily liable for the support of the family. The spouse present shall, upon proper petition in a
summary proceeding, be given judicial authority to administer or encumber any specific separate
property of the other spouse and use the fruits or proceeds thereof to satisfy the latter’s share

Effects on Absolute Community and Conjugal Partnership

- Still remains intact regardless of separation

- If as spouse leaves the conjugal home without justifiable reason, they cannot ask for support
 - Other consequences of separation of spouses
o The separate properties of the husband and wife shall be solidarily liable for the support
of the family if there are no sufficient properties of the community property
o The present spouse may petition the court that he be authorized to administer and
encumber specific separate properties of the other spouse and use the fruits to satisfy his
or her share
- Property acquired during the marriage, even if spouses are separated, is presumed to be conjugal.
o Wong v. IAC et al. 1991 GR 70082

Article 101: If a spouse without just cause abandons the other or fails to comply with his or her obligations
to the family, the aggrieved spouse may petition the court for receivership, for judicial separation of
property or for authority to be the sole administrator of the absolute community, subject to such
precautionary conditions as the court may impose.

The obligations to the family mentioned in the preceding paragraph refer to marital, parental or property
relations.

A spouse is deemed to have abandoned the other when he or she has left the conjugal dwelling without
intention of returning. The spouse who has left the conjugal dwelling for a period of three months or has
failed within the same period to give any information as to his or her whereabouts shall be prima facie
presumed to have no intention of returning to the conjugal dwelling.

Rules/Remedies for the Present Spouse in Case of Abandonment by the Other

- The spouse who has been abandoned may:

o Petition for receivership
o Petition for judicial separation of property
o Petition for authority to become sole administrator of absolute community of property
- Should the spouse be granted authority to administer property, they cannot sell it without court
authority

When is there Abandonment?

- There is abandonment when he/she left the home without intention of returning and no longer
complying with marital, parental, and property relations with the family
o Partosa-Jo v. CA and Dela Cruz v. Dela Cruz
- A spouse is presumed to have abandoned the family if:
o Spouse left the conjugal dwelling for a period of 3 months
o Spouse failed to inform others of whereabouts within 3 months

Section 6: Liquidation of the Absolute Community Assets and Liabilities

Article 102: Upon dissolution of the absolute community regime, the following procedure shall apply:
 1. An inventory shall be prepared, listing separately all the properties of the absolute community
and the exclusive properties of each spouse.
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. Whatever remains of the exclusive properties of the spouses shall thereafter be delivered to each
of them.
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 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 Articles 43, No. (2) and 63, No. (2), the said profits shall be the increase in 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.
5. The presumptive legitimes of the common children shall be delivered upon partition, in
accordance with Article 51.
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.

Rules in Case of Dissolution of the Community Property

- Art 102 outlines the manner/procedure of liquidating absolute community property

Community Property to Answer for all Debts

- All debts of the absolute community are to be paid out of its assets.
o If the community is not sufficient, then, the separate properties of the spouses shall be
answerable
o Spouses shall be solidarily liable

Exception

- A spouse is not liable for the incurred debts of the other without consent
o Johnson and Johnson v. CA et al. GR 102692 1996

Rules after Payment of Debts

- After payment using community properties, net remainder shall be divided among spouses
o Unless the spouses agree on another division or waives a share
- Presumptive legitime of legitimate common children shall be delivered upon partition
o Whatever children receive is considered advanced inheritance (Art 51 (3))
o Children will still be entitled to inherit from their parents
Article 103: Upon the termination of the marriage by death, the community property shall be liquidated
in the same proceeding for the settlement of the estate of the deceased.

If no judicial settlement proceeding is instituted, the surviving spouse shall liquidate the community
property either judicially or extra-judicially within one year from the death of the deceased spouse. If
upon the lapse of the said period, no liquidation is made, any disposition or encumbrance involving the
community property of the terminated marriage shall be void.

Should the surviving spouse contract a subsequent marriage without compliance with the foregoing
requirements, a mandatory regime of complete separation of property shall govern the property relations
of the subsequent marriage.

Duty of the Surviving Spouse

- Surviving spouse must liquidate community property upon termination of marriage by death
o Usually done in the settlement of the estate of the deceased
 Whether testate or intestate
- If no judicial settlement proceeding is filed, the surviving spouse must liquidate the property
within 1 year from the death of the deceased
o Whether judicially or extra-judicially
o If spouse fails to comply with this requirement and sells properties, it is void

Effect of Failure to Comply with Duty to Liquidate

- Any subsequent marriages shall be governed by a mandatory complete separation of property

o To prevent any prejudice to the compulsory heirs of the first marriage
o To prevent fraud to creditors
- Mandatory complete separation of property is an exception to Art 75 where absolute community
shall govern
- Art 102(5) and Art 103 (3)
o Presumptive legitime of legitimate common children must receive partition of property
 To protect the shares of the children

Article 104: Whenever the liquidation of the community properties of two or more marriages contracted
by the same person before the effectivity of this Code is carried out simultaneously, the respective capital,
fruits and income of each community shall be determined upon such proof as may be considered
according to the rules of evidence. In case of doubt as to which community the existing properties belong,
the same shall be divided between or among the different communities in proportion to the capital and
duration of each.

Procedure in Liquidation

- For cases where liquidation process is done for 2 or more marriages

o Determine the respective capital of each community property, then the fruits and income
as may be proven. The law requires that evidence must be presented to prove that one
property belongs or was acquired during the existence of one or the other.
 Onas v. Javillo
- Vda de Delizo v. Delizo
 o If one marriage lasted 18 years and the other 46 years
 Proportion of properties divided will be 18 to 46 if capital of either marriage or
contribution of spouses cannot be determined with mathematical certainty.

Chapter 4: Conjugal Partnership of Gains

Section 1: General Provisions

Article 105: In case the future spouses agree in the marriage settlements that the regime of conjugal
partnership of gains shall govern their property relations during marriage, the provisions in this Chapter
shall be of supplementary application.

The provisions of this Chapter shall also apply to conjugal partnership of gains already established
between spouses before the effectivity of this Code, without prejudice to vested rights already acquired
in accordance with the Civil Code or other laws, as provided in Article 255.

Article 106: Under the regime of conjugal partnership of gains, the husband and wife place in a common
fund the proceeds, products, fruits and income from their separate properties and those acquired by
either or both spouses through their efforts or by chance, and, upon dissolution of the marriage or of the
partnership, the net gains or benefits obtained by either or both spouses shall be divided equally between
them, unless otherwise agreed in the marriage settlements.

Article 107: The rules provided in Articles 88 and 89 shall also apply to conjugal partnership of gains.

Article 108: The conjugal partnership shall be governed by the rules on the contract of partnership in all
that is not in conflict with what is expressly determined in this Chapter or by the spouses in their marriage
settlements.

Rules in Conjugal Partnership

- Spouses place in a common fund the proceeds, products, and fruits and income of their separate
properties and those acquired thereafter through their efforts or by chance. (Art 106)
- Should conjugal partnership be dissolved, the net gains shall be divided equally between the
spouses, unless otherwise agreed upon in the marriage settlements. (Art 106)
o This doesn’t guarantee that the spouses will always get their shares
 Nable Jose v. Nable Jose
 Rights over net gains is inchoate because it may be discovered later, after
liquidation, that there are no conjugal gains to be divided
- Spouses retain ownership and administration of their separate properties (Art 110)
o They also retain possession and enjoyment

Presumption of Conjugality

- It’s a prima facie presumption that real properties acquired during marriage are conjugal
o This may be overturned by a cadastral court rules that a property is paraphernal/exclusive
to the spouse
 - It is sufficient to prove that the property was acquired during marriage for it to be considered
conjugal
o Camia de Reyes v. Reyes de Ilano
o Laluan v. Malpaya
- This presumption only applies when there’s proof that the property was acquired during marriage
o Entonina v CA
 Mere fact that the title was issued when the spouses were already married is not
sufficient proof of conjugality

Section 2: Exclusive Property of Each Spouse

Article 109: The following shall be the exclusive property of each spouse:

1. That which is brought to the marriage as his or her own

2. That which each acquires during the marriage by gratuitous title;
3. That which is acquired by right of redemption, by barter or by exchange with property belonging
to only one of the spouses; and
4. That which is purchased with exclusive money of the wife or of the husband

Property Exclusively Owned

- Properties owned or acquired by spouses before marriage are exclusive

o If they weren’t brought into marriage as absolute community

Sale with Right to Repurchase

- Santos v. Bartolome
o If a future spouse sold his property with right to repurchase before the marriage and
reacquired it during the marriage, the property is still exclusive to that spouse
o If the money he paid for the repurchase came from conjugal assets, then that spouse must
reimburse the conjugal partnership
 Reimbursement is only done at the liquidation of the conjugal partnership
 Consunji v. Tison
- Lorenzo v. Nicolas
o If, however, the money used was the exclusive money of the spouse and he can prove it:
 The property remains exclusively his
 There is no obligation to reimburse conjugal partnership

Nature of Inherited Property

- If a spouse receives property through testate or intestate succession or by donation, that property
is exclusively his

Award of Damages
 - If a spouse meets an accident, and in a suit for damages, he is awarded damages for
hospitalization expenses, medical assistance, and loss of salary, then these are conjugal properties
o Liluis v. MRR
 But any moral damages awarded for personal injury in such accident are exclusive
properties

Redemption of Property

- Alvarez v. Espiritu
o If the husband redeems the paraphernal property of the wife with his money, he doesn’t
own that property
o Ownership belongs to their heirs
o But the estate owes the husband

Property Acquired by Exchange

- Exchange presupposes that there is a barter

- Abella de Diaz v. Erlanger And Galinger Inc
o If an exclusive property is exchanged with another and sometimes was used by the owner,
the same is conjugal property without prejudice to the trade-in value
o The conjugal partnership is indebted to the original owner

Purchase of Property

- Padilla v. Paterno
o If a property is purchased partly with money of the wife and partly with conjugal money,
the same is partly conjugal and partly paraphernal

When Marriage is Descriptive of Status Only

- Gonzales v. Miller
o A is the owner of a parcel of land. The title states: “A, married to B.”
 A is still the owner
o The description or reference to marriage is merely descriptive of A’s civil status

When Property is Acquired under Homestead Law

- Homestead Law – CA No. 141

o A vested right over a homestead is acquired only by the presentation of the final proof
and its approval by the Director of Lands
- Ude Soliman v. Icdang
o If a spouse applies for a homestead and dies before it is granted, the same belongs to the
heirs
o It would never be conjugal property

Wife is the Owner and Administrator of Her Separate Properties; Effect of Sale by Husband

- Manotok Realty Inc. v. CA

o The wife is the owner and administrator of her paraphernal properties
 o If she delivers the administration to her husband, it must be in a public instrument
recorded in the Registry of Property
 If the properties are movables, the husband must give adequate security
 Even if the husband is the administrator, he cannot dispose of the paraphernal
properties
o Reason for the rule
 Selling is an act of ownership; the husband is not the owner
 Administration does not include the power to sell

Property Acquired by Right of Redemption

- Refer to cases
o Santos v. Bartolome
o Lorenzo v. Nicholas
o Alvarez v. Espiritu

Owner of Property Acquired with the Exclusive Money of Either Spouse

- Hartske v. Frankel; Gefes v. Salvio; Gonzales v. Miller

o As a rule, properties purchased with the use of the exclusive money of either spouse is
separate property
- If the property acquired during the marriage is bought by the wife’s exclusive money, it his
considered as her own.
o It doesn’t belong in any community property
o The husband is not authorized to alienate, encumber, make contracts, sell or convey the
property without the knowledge and consent of the property’s lawful owner
 Should the husband act otherwise, the action is null and void
- Perez v. Tuason v. de Perez
o Injunction will not lie to restrain the spouse from alienating their exclusive property on
the ground that the conjugal partnership will be deprived of its fruits
- Rodriguez v. Dela Cruz
o The owner-spouse can freely alienate the property without consent of the other
- Peoples Bank and Trust Co. v. Register of Deeds of Manila
o Administration of such exclusive property can be made by either spouse
 Either spouse may transfer administration of their exclusive properties to each
other or a 3rd person
 Transfer of administration/management still doesn’t make that person
the owner

Property Acquired Gratuitously is Exclusive Property of the Spouse

- Villanueva v. IAC
o Mariano inherited land from his parents; the title was issued “Mariano married to Elsa”
 Mariano and Elsa died; Mariano was survived by 2 illegitimate children
o The children mortgaged the land and failed to pay their obligation and ownership was
consolidated
 A new title was then issued
 o SC Rules:
 The land is not the conjugal property of Elsa and Mariano
 It is exclusively Mariano’s since he inherited it from his parents
- Land with a lucrative title is not conjugal property

Exclusive Property is Liable for the Personal Debts of Owner

- Ramon Ong v. CA
o The mere use of the surname of the husband in the tax declaration of the subject property
is not sufficient proof that said property was acquired during the marriage and is
therefore conjugal.
- Maramba v. Lozano
o When there is no showing as to when the property was acquired by a spouse, the fact
that the title is in the spouse’s name is an indication that the property belongs exclusively
to said spouse

Burden of Proof to Show Conjugality of Property

- Invocation of presumption that all property of the marriage is under conjugal partnership must
be proven
o They must first prove that the property was acquired during the marriage
 Proof of acquisition is a condition sine qua non
 Cobb-Perez et al. v. Lantin
 Jose Ponce de Leon v. Rehabilitation Finance Corp
- PNB v. CA
o 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
Article 110: The spouses retain the ownership, possession, administration and enjoyment of their
exclusive properties.

Either spouse may, during the marriage, transfer the administration of his or her exclusive property to the
other by means of a public instrument, which shall be recorded in the registry of property of the place
where the property is located.

Article 111: A spouse of age may mortgage, encumber, alienate or otherwise dispose of his or her
exclusive property, without the consent of the other spouse, and appear alone in court to litigate with
regard to the same

Article 112: The alienation of any exclusive property of a spouse administered by the other automatically
terminates the administration over such property and the proceeds of the alienation shall be turned over
to the owner-spouse.

Article 110 Discussed

- As the owner of exclusive property, a spouse of age can mortgage, encumber, alienate, dispose
of his/her exclusive property without the consent of the other
o This must be done by public instrument recorded in the registry of property

Effect if Spouse Granted Administration Sells the Property

- The spouse, who was given administration over the property, cannot sell it

Effect of Sale by the Owner Spouse of Administered Property

- In cases where the owner-spouse transfers administration of exclusive property to the other
spouse, but in the meantime, that property was sold to another person.
o Then the transfer of administration is terminated
- Even if one spouse is given administration, the owner-spouse can still perform acts of ownership
o If the owner-spouse sells the property, the administration of the other spouse
automatically ceases

Article 113: Property donated or left by will to the spouses, jointly and with designation of determinate
shares, shall pertain to the donee-spouse as his or her own exclusive property, and in the absence of
designation, share and share alike, without prejudice to the right of accretion when proper.

Article 114: If the donations are onerous, the amount of the charges shall be borne by the exclusive
property of the donee-spouse, whenever they have been advanced by the conjugal partnership of gains.

Article 115: Retirement benefits, pensions, annuities, gratuities, usufructs and similar benefits shall be
governed by the rules on gratuitous or onerous acquisitions as may be proper in each case.

Situations where a Property is Donated to the Spouses or Inherited by them

- Article 113 refers to 2 situations:

o Where a property is donated to the spouses
 o Or inherited by them with designation of shares, and where there is no designation of
shares.
- In both situations the property belongs to them exclusively
o If there is no designation as to their shares, the property shall be divided between them,
but it shall belong to them exclusively
- Example:
o Donated:
 A donated a parcel of land to X and Y, spouses with designation of shares, like 1/2
to X and 1/2 to Y. The share of each spouse belongs to him/her exclusively
 If there is no designation of shares, then, the property shall be divided
into two, share and share alike and still, the share of each shall belong
exclusively to them.
 There is no prejudice to the right of succession
- Article 114 refers to onerous donations
o If such a donation is given to a spouse, that donation is exclusive and shall answer for
whatever charges.
- Onerous Donation
o Donation where burdens and charges or future services equal in value if not greater than
that of the thing donated
o Example
 If A donates a one-hectare lot to B in Quezon City, with the obligation to construct
a children’s center/park worth P500,000.00, then, his exclusive property shall
answer for such a charge or burden. If the P500,000.00 was advanced by the
conjugal partnership, then, the exclusive properties of B must reimburse the
conjugal partnership

Ownership of Retirement Benefits, etc.

- Article 115 determines who owns retirement benefits, pensions, annuities, gratuities, usufructs,
and similar benefits
o If they are acquired by gratuitous title, they are exclusive
 Article 109
o If acquired by onerous title during the marriage, they are conjugal
 Article 117(1)
- Retirement Benefits
o Payments or services provided after reaching the age of retirement or upon withdrawal
from one’s position or occupation
 Payments/services received are separate and distinct from normal salaries
o Ferrer v. GSIS
 Retirement benefits aren’t conjugal, but they belong to the beneficiary
- Pension
o An amount given regularly to an official or employee of the Government out of liberality
and as an expression of its appreciation for past services.
 For old/disabled people
  Pensions are in compliance with the State’s duty to help the aged and disabled
who have previously served the community with loyalty, constancy, and self-
abnegation
 Alano v. Florido
o Pension received by the husband under CA No 188 is conjugal and is answerable for the
support of the family
 CA No. 188: “Liquidation of the Pension and Retirement Fund of the Philippine
Constabulary”
o Pension is gratuity only when it is granted for services previously rendered and which at
the time, they were rendered gave rise to no legal obligation
 Pirovano v. De la Rama Steamship Co.
- Annuity
o A fixed sum of money paid to someone each year; usually for the rest of their life.
o The aleatory contract of life annuity binds the debtor to pay an annual pension or income
during the life of one or more determinate persons in consideration of a capital consisting
of money or other property, whose ownership is transferred to him at once with the
burden of the income
 Example:
 A gave to B a building with the condition that B will give an annual income
of P200,000.00 as long as A lives. Here, the ownership of the building is
immediately transferred to B with the burden of the annual income. If
the building is exclusive property, the annuity of P200,000.00 is separate
property of the recipient.
- Gratuity
o Something voluntarily given in return for a favor or services
 Pirovano v. De la Rama Steamship Co.
o A bounty, a tip that paid to the beneficiary for past services rendered purely out of
generosity of the giver
 Peralta v. Auditor General
 Mendoza v. Dizon
- Usufructs
o The right to enjoy the property of another
 With the obligation of preserving its form and substance
 Unless the title or law otherwise provides
o If the usufruct is acquired gratuitously, it is exclusive property
 But the fruits are conjugal
- Life Insurance Benefits
o It’s a special contract and the destination of the proceeds thereof is determined by special
law which deals exclusively on the subject.
o If the beneficiary is someone other than the insured or his estate,
 The beneficiary is the owner of the insurance indemnity regardless of whether
the premiums were paid out of the insured’s separate property or conjugal funds
 Del Val v. Del Val
 o If the insured made his estate the beneficiary and paid by conjugal funds, the proceeds of
the insurance are also conjugal property
 BPI v. Posadas
- Social Security System
o RA 1161 – Social Security Act of 1954
o Not a law of succession
o Ordinarily, it is not the heirs of the employee who are to receive the benefits or
compensation.
 When the beneficiary is the estate, or when there is none designated, or if the
designation is void, the SSS will pay the heirs
 Non-relatives or a 3rd person may also be designated as beneficiaries
o The beneficiary or beneficiaries should be the ones to primarily profit under the System
where the government had not contributed anything.
 The contributions came from the employees and their employers
 Tecson v. SSS

Section 3: Conjugal Partnership Property

Article 116: All property acquired during the marriage, whether the acquisition appears to have been
made, contracted or registered in the name of one or both spouses, is presumed to be conjugal unless the
contrary is proved.

Presumption of Conjugality of Properties of the Husband and Wife

- If there is a property that is acquired by onerous title during the marriage,

o There is a presumption of conjugality regardless of the source of the funds used to acquire
it.
o However, this must be proven
- Must always be proven

Effect if Property is Adjudicated to Only One of the Spouses

- During the marriage, if property was acquired by the spouses but registers only one of their
names, it is presumed that the property is conjugal; unless proven otherwise
- The adjudication of real property to one of the spouses only does not necessarily mean that it is
his or her exclusive property, if said land was acquired during the marriage.
o However, if the title shows the names of both spouses then it’s proof that the property is
conjugal
 E.g. “Teodulo Diaz married to Maria Espejo”
 Diaz v. CA

Property Acquired During the Second Marriage

- If the property was registered in the 2nd marriage, it’s presumed as acquired in the 2nd marriage
o Children of the 1st marriage can’t claim property of the 2nd marriage as conjugal property
 Mang-oy v. CA
Article 117: The following are conjugal partnership properties:

1. Those acquired by onerous title during the marriage at the expense of the common fund, whether
the acquisition be for the partnership, or for only one of the spouses;
2. Those obtained from the labor, industry, work or profession of either or both of the spouses;
3. The fruits, natural, industrial, or civil, due or received during the marriage from the common
property, as well as the net fruits from the exclusive property of each spouse;
4. The share of either spouse in the hidden treasure which the law awards to the finder or owner of
the property where the treasure is found;
5. Those acquired through occupation such as fishing or hunting;
6. Livestock existing upon the dissolution of the partnership in excess of the number of each kind
brought to the marriage by either spouse; and
7. Those which are acquired by chance, such as winnings from gambling or betting. However, losses
therefrom shall be borne exclusively by the loser-spouse.

Salaries are Conjugal

- Benefits obtained from the salaries of the spouses and their businesses are conjugal
o Reason being they were obtained via labor/industry of a spouse during the marriage

Ownership of Fruits of Separate Properties

- Fruits of the common and separate properties of the spouses are conjugal
- Example:
o A owns a 10-door apartment leased to different lessees for P2,000.00 per month. In
January 1988, he collected one-year advance rentals. On June 1, 1988, he got married to
B.
o Under such a situation, A is supposed to deliver to the conjugal partnership the rentals
from June 1988, to December 1988
o Because such rentals are considered fruits of the separate properties of A which form part
of their conjugal partnership.
 In short, A is indebted to the conjugal partnership for the rentals beginning June
1988
- BA Finance Corp. v CA
o A business established during the marriage is presumed to be conjugal
o The fact that it’s registered under the name of only one spouse doesn’t make in non-
conjugal
Article 118: Property bought on installments paid partly from exclusive funds of either or both spouses
and partly from conjugal funds belongs to the buyer or buyers if full ownership was vested before the
marriage and to the conjugal partnership if such ownership was vested during the marriage. In either case,
any amount advanced by the partnership or by either or both spouses shall be reimbursed by the owner
or owners upon liquidation of the partnership.

Property Acquired on Installments

- Such properties are exclusively owned if full ownership was vested before the marriage
- The properties are conjugal when ownership was vested during the marriage
- In both situations:
o Any amount advance d by the partnership or by either/both spouses shall be reimbursed
by the owner/s upon liquidation of the partnership

Article 119: Whenever an amount or credit payable within a period of time belong to one of the spouses,
the sums which may be collected during the marriage in partial payments or by installments on the
principal shall be the exclusive property of the spouse. However, interests falling due during the marriage
on the principal shall belong to the conjugal partnership.

Example Situation

- A lent B the amount of P50,000.00 payable in one year starting January 1988. On June 1, 1988, A
married C.
- In such a case, any amount collected by A from B in payment of the principal is his exclusive
property.
- However, if the obligation earns interest, any interest falling due from June 1988 is conjugal.
o The reason for this is that, interests are considered as fruits of the separate properties of
each spouse.
o However, with respect to the capital, the same is exclusive property, because that is
considered as exclusive property of each spouse.

Article 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.
Ownership of Land and Building

- Art 120 makes a distinction depending upon the value of each property at the time of the
improvement.
- X is the owner of a parcel of land. He married Y. Out of the conjugal funds, a five-story building
was constructed on the land.
o If the building is more valuable than the land, then the conjugal partnership shall become
the owner of the land and the building.
o On the other hand, if the land is more valuable than the building, then, the building shall
become the property of X
o In both cases, however, the conjugal partnership or X has the obligation to reimburse the
cost of the land or the building at the time of the liquidation of the conjugal partnership.
- Reimbursement shall be done during the liquidation of the conjugal partnership.
o Ownership of the entire property shall be vested only upon liquidation of the conjugal
partnership

Section 4: Charges Upon and Obligations of the Conjugal Partnership

Article 121: The conjugal partnership shall be liable for:
1. The support of the spouses, their common children, and the legitimate children of either spouse;
however, the support of illegitimate children shall be governed by the provisions of this Code on
Support;
2. All debts and obligations contracted during the marriage by the designated administrator-spouse
for the benefit of the conjugal partnership of gains, or by both spouses or by one of them with
the consent of the other;
3. Debts and obligations contracted by either spouse without the consent of the other to the extent
that the family may have been benefited;
4. All taxes, liens, charges and expenses, including major or minor repairs upon the conjugal
partnership property;
5. All taxes and expenses for mere preservation made during the marriage upon the separate
property of either spouse;
6. Expenses to enable either spouse to commence or complete a professional, vocational, or other
activity for self-improvement;
7. Ante-nuptial debts of either spouse insofar as they have redounded to the benefit of the family;
8. The value of what is donated or promised by both spouses in favor of their common legitimate
children for the exclusive purpose of commencing or completing a professional or vocational
course or other activity for self-improvement; and
9. Expenses of litigation between the spouses unless the suit is found to be groundless.
If the conjugal partnership is insufficient to cover the foregoing liabilities, the spouses shall be solidarily
liable for the unpaid balance with their separate properties.

Rule on Support
- Under Art 195 FC, the following are obliged to support each other:
o The spouses
 o Legitimate ascendants and descendants
o Parents and their legitimate children and the legitimate and illegitimate children of the
latter
o Parents and their illegitimate children and the legitimate and illegitimate children of the
latter; and
o Legitimate brothers and sisters, whether of full or half-blood
- Support of illegitimate children of each spouse shall be charged from their separate properties.
o If a spouse doesn’t have separate properties, then the conjugal partnership shall advance
the same
 But said advances shall be deducted from the share of the spouse obliged upon
liquidation of the conjugal partnership (Art 197)
Effect if Debts Were Contracted During the Marriage
- Debts and obligations contracted during the marriage by the administrator-spouse shall be
chargeable against the conjugal partnership for as long as they redounded to the benefit of the
family
o For said property to be held liable, the obligation contracted by the administrator-
husband must have redounded to the benefit of the conjugal partnership under Art 121
 BA Finance Corp v. CA
- Where the obligation sought to be enforced against the conjugal property managed by the wife
was incurred by the husband after the latter had abandoned his family and had left the conjugal
home, such obligation was undoubtedly contracted for his own benefit. To make the conjugal
property liable for said loan would be unjust and contrary to the express provision of the Family
Code
o It is true that the husband and wife are the administrators of the conjugal partnership
pursuant to Article 163, NCC (Now Art. 124 of the Family Code) yet, as administrators of
the said property, the only obligations incurred by the husband or wife that are
chargeable against the conjugal property are those incurred in the legitimate pursuit of
his/her career, profession or business with the honest belief that he is doing right for the
benefit of the family.
- A conjugal partnership 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 them of some
advantages which clearly accrued to the welfare of the spouses.
Conjugal Properties Do Not Answer Obligations of Husband if they did not Redound to the Benefit of
the Family
- Philippine Bank of Commerce v. CA
o Conjugal properties cannot be made to answer for obligations of the husband if they did
not redound to the benefit of the family
 The husband is to augment the funds of conjugal partnership not dissipate them
 If the conjugal partnership is saddled with financial burden, the family suffers
Conjugal Properties Cannot Answer for the Surety Undertaking of a Spouse
- Ayala Investments and Development Corp v. CA
o Surety undertakings of a spouse cannot bind the conjugal properties of the husband and
wife even if it has become a part of his duties as an officer of a corporation to sign as
surety in undertakings of the corporation of which he is an officer of.
 o The signing as a surety is not an exercise of an industry or profession
Liability of the Conjugal Partnership for Obligations Redounding to the Benefit of the Family
- The test of liability is the fact that they redounded to the benefit of the family
o This is true even if:
 the obligations were contracted without consent of the other spouse
 the obligations were contracted before the marriage
- Measure of liability of the absolute community and conjugal properties is the direct benefit of the
family

Article 122: 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.
Neither shall the fines and pecuniary indemnities imposed upon them be charged to the partnership.
However, the payment of personal debts contracted by either spouse before the marriage, that of fines
and indemnities imposed upon them, as well as the support of illegitimate children of either spouse, may
be enforced against the partnership assets after the responsibilities enumerated in the preceding Article
have been covered, if the spouse who is bound should have no exclusive property or if it should be
insufficient; but at the time of the liquidation of the partnership, such spouse shall be charged for what
has been paid for the purposes above-mentioned.

Benefit to the Family is Required for Ante-Nuptial Debts, etc. to be Answered by the Properties
- Ante-nuptial debts of either spouse may be charged against the conjugal partnership as long as
they redounded to the benefit of the family.
o Art 121

Article 123: Whatever may be lost during the marriage in any game of chance, or in betting, sweepstakes,
or any other kind of gambling whether permitted or prohibited by law, shall be borne by the loser and
shall not be charged to the conjugal partnership but any winnings therefrom shall form part of the
conjugal partnership property.

Related to Article 95
- To punish the gambler-spouse
o Gambling dissipates the community of properties
Section 5: Administration of the Conjugal Partnership Property
Article 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 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.

Acts of Administration
- Rule
o A spouse may perform acts of administration alone over their properties without the
consent of the other
o A spouse may designate the other spouse as the administrator of their properties
- Joint management/administration
o May be exercised alone
o Husband prevails in cases of conflict
 Wife has remedy by going to court within 5 years from the date of implementing
the husband’s decision
- G-Tractors Inc v. CA
o The sale at auction of a conjugal property to satisfy the husband’s debt is valid and
unassailable, because the conjugal partnership of gains must answer for the indebtedness
that the husband incurs in pursuing his profession
Effect of Divorce
- Van Dorn v. Judge Romillo, Jr.
o When the American husband of a Filipina obtains a divorce pursuant to his national law,
he becomes no longer the Filipina’s husband
 He is bound by the decision of his country’s court
o The husband loses his legal standing to sue his wife as a husband
o The husband loses his control over conjugal assets
Section 6: Dissolution of Conjugal Partnership Regime
Article 126: The conjugal partnership terminates
1. Upon the death of either spouse;
2. When there is a decree of legal separation;
3. When the marriage is annulled or declared void; or
4. In case of judicial separation of property during the marriage under Articles 134 to 138.

Death of a Spouse
- Rules
o Art 103: Upon the termination of the marriage by death, the community property shall
be liquidated in the same proceeding for the settlement of the estate of the deceased.
o If no judicial settlement proceeding is instituted, the surviving spouse shall liquidate the
community property either judicially or extra-judicially within one year from the death of
the deceased spouse. If upon the lapse of the one-year period, no liquidation is made,
any disposition or encumbrance involving the community property of the terminated
marriage shall be void.
o Should the surviving spouse contract a subsequent marriage without compliance with the
foregoing requirements, a mandatory regime of complete separation of property shall
govern the property relations of the subsequent marriage.
Legal Separation
- Rules
o Art 63(2): The absolute community or the conjugal partnership shall be dissolved or
liquidated but the offending spouse shall have no right to any share of the net profits
earned by the absolute community or the conjugal partnership, which shall be forfeited
in accordance with the provisions of Article 43(2)
o Art 43(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
o Art 64: After the finality of the decree of legal separation, the innocent spouse may revoke
the donations made by him or by her in favor of the offending spouse, as well as the
designation of the latter as beneficiary in any insurance policy, even if such designation
be stipulated as irrevocable. The revocation of the donations shall be recorded in the
registries of property in the places where the properties are located. Alienations, liens
and encumbrances registered in good faith before the recording of the complaint for
revocation in the registries of property shall be respected. The revocation of or change in
the designation of the insurance beneficiary shall take effect upon written notification
thereof to the insured.
 The action to revoke the donation under this Article must be brought within five
years from the time the decree of legal separation has become final.
Effect of Annulment of Marriage
- Rules
o In case of annulment of marriage or declaration of nullity, the conjugal partnership is still
dissolved and liquidated
 If one spouse contracted the marriage in bad faith, he shall lose his share of the
net profits of partnership in favor of the common children or children of the guilty
spouse by a previous marriage or to the innocent spouse
 Guilty spouse is not entitled to the net gains of the conjugal partnership.
Separation of Properties

- Rule
o Art 137: Once the separation of property has been decreed, the absolute community or
conjugal partnership of gains shall be liquidated.

Article 127: The separation in fact between husband and wife shall not affect the regime of conjugal
partnership, except that:

1. The spouse who leaves the conjugal home or refuses to live therein, without just cause, shall not
have the right to be supported;
2. When the consent of one spouse to any transaction of the other is required by law, judicial
authorization shall be obtained in a summary proceeding;
3. In the absence of sufficient conjugal partnership property, the separate property of both spouses
shall be solidarily liable for the support of the family. The spouse present shall, upon petition in a
summary proceeding, be given judicial authority to administer or encumber any specific separate
property of the other spouse and use the fruits or proceeds thereof to satisfy the latter’s share.

Article 128: If a spouse without just cause abandons the other or fails to comply with his or her obligations
to the family, the aggrieved spouse may petition the court for receivership, for judicial separation of
property, or for authority to be the sole administrator of the conjugal partnership property, subject to
such precautionary conditions as the court may impose.

The obligations to the family mentioned in the preceding paragraph refer to marital, parental or property
relations.

A spouse is deemed to have abandoned the other when he or she has left the conjugal dwelling without
intention of returning. The spouse who has left the conjugal dwelling for a period of three months or has
failed within the same period to give any information as to his or her whereabouts shall be prima facie
presumed to have no intention of returning to the conjugal dwelling.

Effect of Separation-in-Fact of the Spouses

- As listed in Art 127

- Must be taken together with Article 101
o Separation in fact doesn’t dissolve the marriage
Section 7: Liquidation of the Conjugal Partnership Assets and Liabilities

Article 129: Upon the dissolution of the conjugal partnership regime, the following procedure shall apply:

1. An inventory shall be prepared, listing separately all the properties of the conjugal partnership
and the exclusive properties of each spouse.
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. 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. 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.
5. Whatever remains of the exclusive properties of the spouses shall thereafter be delivered to each
of them.
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
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
8. The presumptive legitimes of the common children shall be delivered upon partition in
accordance with Article 51.
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.

Paragraph 3

- References Article 120

Paragraph 4

- Debts and obligations discussed are those that benefited the family
o Net assets shall be divided. Separate properties of each spouse, if there is any remainder,
shall be delivered to them.
Article 130: Upon the termination of the marriage by death, the conjugal partnership property shall be
liquidated in the same proceeding for the settlement of the estate of the deceased.

If no judicial proceeding is instituted, the surviving spouse shall liquidate the conjugal partnership
property either judicially or extra-judicially within one year from the death of the deceased spouse. If
upon the lapse of the six-month period no liquidation is made, any disposition or encumbrance involving
the conjugal partnership property of the terminated marriage shall be void.

Should the surviving spouse contract a subsequent marriage without compliance with the foregoing
requirements, a mandatory regime of complete separation of property shall govern the property relations
of the subsequent marriage.

As Discussed in Article 103

Article 131: Whenever the liquidation of the conjugal partnership properties of two or more marriages
contracted by the same person before the effectivity of this Code is carried out simultaneously, the
respective capital, fruits and income of each partnership shall be determined upon such proof as may be
considered according to the rules of evidence. In case of doubt as to which partnership the existing
properties belong, the same shall be divided between the different partnerships in proportion to the
capital and duration of each.

As Discussed in Article 104

Article 132: The Rules of Court on the administration of estates of deceased persons shall be observed in
the appraisal and sale of property of the conjugal partnership, and other matters which are not expressly
determined in this Chapter.

Article 133: From the common mass of property, support shall be given to the surviving spouse and to the
children during the liquidation of the inventoried property and until what belongs to them is delivered;
but from this shall be deducted that amount received for support which exceeds the fruits or rents
pertaining to them.
Chapter 5: Separation of Property of the Spouses and Administration of Common Property by One
Spouse During the Marriage

Article 134: In the absence of an express declaration in the marriage settlements, the separation of
property between spouses during the marriage shall not take place except by judicial order. Such judicial
separation of property may either be voluntary or for sufficient cause.

Where there can be Separation of Properties During the Marriage

- There may only be separation if there is a judicial order

o May be voluntary or by causes found in Art 135
- Exceptions
o Modifications for marriage settlements
 Arts 66, 67, 128, 135, 136

Article 135: Any of the following shall be considered sufficient cause for judicial separation of property:

1. That the spouse of the petitioner has been sentenced to a penalty which carries with it civil
interdiction;
2. That the spouse of the petitioner has been judicially declared an absentee;
3. That loss of parental authority of the spouse of petitioner has been decreed by the court;
4. That the spouse of the petitioner has abandoned the latter or failed to comply with his or her
obligations to the family as provided for in Article 101;
5. That the spouse granted the power of administration in the marriage settlement has abused that
power; and
6. That at the time of the petition, the spouses have been separated in fact for at least one (1) year
and reconciliation is highly improbable.

In the cases provided for in nos. 1, 2, and 3, the presentation of the final judgment against the guilty or
absent spouse shall be enough basis for the grant of the decree of judicial separation of property

Declaration of Absence (Paragraph 2)

- Absence may be declared under circumstances provided by Art 384 CC

o Art 384 CC:
 Two years having elapsed without any news about the absentee or since the
receipt of the last news, and five years in case the absentee has left a person in
charge of the administration of his property, his absence may be declared
- The following may ask for declaration of absence under Art 385 CC:
o The spouse present;
o The heirs instituted in a will, who may present an authentic copy of the same;
o The relatives who may succeed by the law of intestacy;
o Those who may have over the property of the absentee some right subordinated to the
condition of his death.
- The judicial declaration of absence, however, shall not take effect until 6 months after its
publication in a newspaper of general circulation.
Constructive and Actual Abandonment

- Abandonment
o Presupposes that a spouse leaves the conjugal dwelling without intentions to return
- Constructive Abandonment
o Mere act of preventing the spouse from returning to the conjugal dwelling
o Partosa-Jo v. CA
 Husband was considered as having abandoned the wife despite not leaving the
home
 Husband was preventing the wife from returning after a vacation
- Actual Abandonment
o Stipulated in Art 101
 Spouse leaves with no intention to return
 Left for 3 months
 Or has failed to inform anyone of his whereabouts after 3 months

Separation for at least 1 Year

- It’s not enough that spouses are separated in fact for at least 1 year
- Prerequisite
o Reconciliation is highly improbably

Article 136: The spouse may jointly file a verified petition with the court for the voluntary dissolution of
the absolute community or the conjugal partnership of gains, and for the separation of their common
properties.

All creditors of the absolute community or of the conjugal partnership of gains, as well as the personal
creditors of the spouse, shall be listed in the petition and notified of the filing thereof. The court shall take
measures to protect the creditors and other persons with pecuniary interest.

Article 137: Once the separation of property has been decreed, the absolute community or the conjugal
partnership of gains shall be liquidated in conformity with this Code.

During the pendency of the proceedings for separation of property, the absolute community or the
conjugal partnership shall pay for the support of the spouses and their children

Article 138: After dissolution of the absolute community or of the conjugal partnership, the provisions on
complete separation of property shall apply.

Article 139: The petition for separation of property and the final judgment granting the same shall be
recorded in the proper local civil registries and registries of property

Article 140: The separation of property shall not prejudice the rights previously acquired by creditors
Article 141: The spouses may, in the same proceedings where separation of property was decreed, file a
motion in court for a decree reviving the property regime that existed between them before the
separation of property in any of the following instances:

1. When the civil interdiction terminates;

2. When the absentee spouse reappears;
3. When the court, being satisfied that the spouse granted the power of administration in the
marriage settlements will not again abuse that power, authorizes the resumption of said
administration;
4. When the spouse who has left the conjugal home without a decree of legal separation resumes
common life with the other;
5. When parental authority is judicially restored to the spouse previously deprived thereof;
6. When the spouses who have been separated in fact for at least one year, reconcile and resume
common life; or
7. When after voluntary dissolution of the absolute community of property or conjugal partnership
has been judicially decreed upon the joint petition of the spouses, they agree to the revival of the
former property regime. No voluntary separation of property may thereafter be granted.

The revival of the former property regime shall be governed by Article 67.

Article 142: The administration of all classes of exclusive property of either spouse may be transferred by
the court to the other spouse:

1. When one spouse becomes the guardian of the other;

2. When one spouse is judicially declared an absentee;
3. When one spouse is sentenced to a penalty which carries with it civil interdiction; or
4. When one spouse becomes a fugitive from justice or is in hiding as an accused in a criminal case.

If the other spouse is not qualified by reason of incompetence, conflict of interest, or any other just cause,
the court shall appoint a suitable person to be the administrator
Chapter 6: Regime of Separation of Property

Article 143: Should the future spouses agree in the marriage settlements that their property relations
during marriage shall be governed by the regime of separation of property, the provisions of this Chapter
shall be suppletory.

Article 144: Separation of property may refer to present or future property or both. It may be total or
partial. In the latter case, the property not agreed upon as separate shall pertain to the absolute
community.

Article 145: Each spouse shall own, dispose of, possess, administer and enjoy his or her own separate
estate, without need of the consent of the other. To each spouse shall belong all earnings from his or her
profession, business or industry and all fruits, natural, industrial or civil, due or received during the
marriage from his or her separate property

Article 146: Both spouses shall bear the family expenses in proportion to their income, or, in case of
insufficiency or default thereof, to the current market value of their separate properties.

The liability of the spouses to creditors for family expenses shall, however, be solidary

Rules on Complete Separation of Property Regime

- Future spouses may agree on a regime of complete separation

o May be total or partial separation
- Spouses may declare specific properties as their separate properties
o Arts 92 and 109

Effect if Parties are Governed by Complete Separation

- Spouses retain ownership and possession of their separate properties

o Fruits and income are exclusive to them in absolute ownership
- Spouses may dispose of their exclusive properties without consent of the other
Chapter 7: Property Regime of Unions Without Marriage

Article 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 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 or of 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.

Coverage of the Law

- Article 147 discusses a situation where a man and woman who live together as spouses, without
benefit of marriage, are capacitated to live as husband and wife or to marry each other.
o If one of them is already married, this doesn’t apply because they are not capacitated to
marry

Property Regimes of the Two Unions

- Paragraph 4 discusses the property regimes

- Default property regime is co-ownership
o ½ for each spouse
- If one of the parties to a void marriage is in bad faith
o The spouse in bad faith forfeits co-ownership in favor of common children

Application and Requisites

- Elna Mercado-Fehr v. Bruno Fehr

o Bruno bought a condo 2 years before getting married to Elna
 Bruno bought the condo with his exclusive money but in installments
 Ownership was vested during the time they lived together
 Prior to marriage
 Elna signed her name in the title as “Mercado-Fehr”
o The marriage was void ab initio
o Co-ownership applies
 Since the condo was acquired during their cohabitation
 - Requisites (Elna Mercado-Fehr v. Bruno Fehr)
o Must be capacitated to marry each other
o Live exclusively with each other as husband and wife
o Their union is without the benefit of marriage or their marriage is void

Intent of the Law

- To cover a singular relationship

o If a man has several common-law wives, the law does not apply

Presumption of Co-ownership

- Even if the man is the only one employed and the properties which were acquired during their
coverture came from the salaries or wages of the man
o The properties are presumed to be co-owned by both parties
 The contributions of the woman, presumably housewife, contributed by caring
for the home and the family

Co-ownership is the Property Relationship in Void Marriage due to Psychological Incapacity

- Since marriage was void due to psychological incapacity

o Valdes v. RTC

Article 148: In cases of cohabitation not falling under the preceding Article, only the properties acquired
by both of the parties through their actual joint contribution of money, property, or industry shall be
owned by them in common in proportion to their respective contributions. In the absence of proof to the
contrary, their contributions and corresponding shares are presumed to be equal. The same rule and
presumption shall apply to joint deposits of money and evidences of credit.

If one of the parties is validly married to another, his or her share in the co-ownership shall accrue to the
absolute community or conjugal partnership existing in such valid marriage. If the party who acted in bad
faith is not validly married to another, his or her share shall be forfeited in the manner provided in the
last paragraph of the preceding Article.

The foregoing rules on forfeiture shall likewise apply even if both parties are in bad faith.

Coverage of the Law

- Article 148 refers to cohabitation where the parties are not capacitated to marry each other
o E.g. bigamous marriages, adulterous relationship, etc.

Rules on Forfeiture of Shares

- Rules
o If one of the parties is validly married to another, his/her share shall redound to the
benefit of the absolute community or the conjugal partnership in the valid marriage;
o If the party who acted in bad faith is not validly married to another person, his or her
share shall be distributed in the following manner:
  The share of the party in bad faith shall go to their common children;
 In default of common children or if they waived their share, the properties shall
go to their respective children;
 If there are no common children or children of their own, the share of the party
in bad faith shall go to the innocent spouse.
- Forfeiture is applicable if both are in bad faith
- If both are validly married already and no one is in bad faith, their respective shares go to their
respective marriages
- Exception
o Salaries and wages are exclusive to the parties