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Republic of the Philippines SUPREME COURT Manila FIR T DI!I I"# G.R. No. L-44059 October 28, 1977 THE NSUL!R L "E !SSUR!NCE COMP!N#, LT$., plaintiff$appellee, %s& C!RPON ! T. E%R!$O &'( P!SCU!L! )$!. $E E%R!$O, defendants$appellants&

M!RT N, J.* This is a no%el 'uestion in insurance la() *an a common$la( (ife named as beneficiary in the life insurance policy of a le+ally married man claim the proceeds thereof in case of death of the latter, "n eptember 1, 1-./, 0uena%entura *ristor 1brado (as issued by The 2ife 3ssurance *o&, 2td&, Policy #o& 00--2- on a (hole$life for P4,//2&00 (ith a, rider for 3ccidental Death for the same amount 0uena%entura *& 1brado desi+nated T& 1brado as the re%ocable beneficiary in his policy& 5e to her as his (ife& "n "ctober 21, 1-.-, 0uena%entura *& 1brado died as a result of an t (hen he (as hit by a failin+ branch of a tree& 3s the policy (as in force, The Insular 2ife 3ssurance *o&, 2td& liable to pay the co%era+e in the total amount of P11,674&63, representin+ the face %alue of the policy in the amount of P4,//2&00 plus the additional benefits for accidental death also in the amount of P4,//2&00 and the refund of P1/&00 paid for the premium due #o%ember, 1-.-, minus the unpaid premiums and interest thereon due for 8anuary and February, 1-.-, in the sum of P3.&26& *arponia T& 1brado filed (ith the insurer a claim for the proceeds of the Policy as the desi+nated beneficiary therein, althou+h she admits that she and the insured 0uena%entura *& 1brado (ere merely li%in+ as husband and (ife (ithout the benefit of marria+e& Pascuala !da& de 1brado also filed her claim as the (ido( of the deceased insured& entitled to the insurance proceeds, not the common$la( (ife, *arponia T& 1brado& he asserts that she is the one

In doubt as to (hom the insurance proceeds shall be paid, the insurer, The Insular 2ife 3ssurance *o&, 2td& commenced an action for Interpleader before the *ourt of First Instance of Ri9al on 3pril 2-, 1-60& 3fter the issues ha%e been :oined, a pre$trial conference (as held on 8uly /, 1-62, after (hich, a pre$trial order (as entered readin+ as follo(s) +.wph!1

Durin+ the pre$trial conference, the parties manifested to the court& that there is no possibility of amicable settlement& 5ence, the *ourt proceeded to ha%e the parties submit their e%idence for the purpose of the pre$trial and ma;e admissions for the purpose of pretrial& Durin+ this conference, parties *arponia T& 1brado and Pascuala 1brado a+reed and stipulated) 1< that the deceased Buenaventura Ebrado was married to Pascuala Ebrado with whom she has six !le"itimate# namel$% &ernando' (resencio' Elsa' Erlinda' )eli*ardo and &elen' all surnamed Ebrado= 2< that durin+ the lifetime of the deceased, he (as insured (ith Insular 2ife 3ssurance *o& >nder Policy #o& 00--2- (hole life plan, dated eptember 1, 1-./ for the sum of P4,//2&00 (ith the rider for accidental death benefit as e%idenced by 1?hibits 3 for plaintiffs and 1?hibit 1 for the defendant Pascuala and 1?hibit 6 for *arponia 1brado= 3< that durin" the li+etime o+ Buenaventura Ebrado' he was livin" with his common,wi+e' (arponia Ebrado' with whom she had - children althou"h he was not le"all$ separated +rom his le"al wi+e = 7< that 0uena%entura in accident on "ctober 21, 1-.- as e%idenced by the death 1?hibit 3 and affida%it of the police report of his death 1?hibit 4= 4< that complainant *arponia 1brado filed claim (ith the Insular 2ife 3ssurance *o& (hich (as contested by Pascuala 1brado (ho also filed claim for the proceeds of said policy .< that in %ie( ofthe ad%erse claims the insurance company filed this action a+ainst the t(o herein claimants *arponia and Pascuala 1brado= 6< that there is no( due from the Insular 2ife 3ssurance *o& as proceeds of the policy P11,674&63= /< that the beneficiary desi+nated by the insured in the policy is *arponia 1brado and the insured made reser%ation to chan+e the beneficiary but althou+h the insured made the option to chan+e the beneficiary, same (as ne%er chan+ed up to the time of his death and the (ife did not ha%e any opportunity to (rite the company that there (as reser%ation to chan+e the desi+nation of the parties a+reed that a decision be rendered based on and stipulation of facts as to (ho amon+ the t(o claimants is entitled to the policy& >pon motion of the parties, they are +i%en ten @10< days to file their simultaneous memoranda from the receipt of this order& " "RD1R1D& "n eptember 24, 1-62, the trial court rendered :ud+ment declarin+ amon+ others, *arponia T& 1brado dis'ualified from becomin+ beneficiary of the insured 0uena%entura *ristor 1brado and directin+ the payment of the insurance proceeds to the estate of the deceased insured& The trial court held) +.wph!1 It is patent from the last para+raph of 3rt& 63- of the *i%il *ode that a criminal con%iction for adultery or concubina+e is not essential in order to establish the dis'ualification mentioned therein& #either is it also necessary that a findin+ of such +uilt or commission of those acts be made in a separate independent action brou+ht for the purpose& The +uilt of the donee @beneficiary< may be pro%ed by preponderance of e%idence in the same proceedin+ @the action brou+ht to declare the nullity of the donation<& It is, ho(e%er, essential that such adultery or concubina+e e?ists at the time defendant *arponia T& 1brado (as made beneficiary in the policy in 'uestion for the dis'ualification and incapacity to e?ist and that it is only necessary that such fact be established by preponderance of e%idence in the trial& ince it is a+reed in their stipulation abo%e$'uoted that the deceased insured and defendant *arponia T& 1brado (ere li%in+ to+ether as husband and (ife (ithout bein+ le+ally married and that the marria+e of the insured (ith the other defendant Pascuala !da& de 1brado (as %alid and still e?istin+ at the time the insurance in 'uestion (as purchased there is no 'uestion that defendant *arponia T& 1brado is dis'ualified from becomin+ the beneficiary of the policy in 'uestion and as such she is not entitled to the proceeds of the insurance upon the death of the insured& From this :ud+ment, *arponia T& 1brado appealed to the *ourt of 3ppeals, but on 8uly 11, 1-6., the 3ppellate *ourt

certified the case to >s as in%ol%in+ only 'uestions of la(& Ae affirm the :ud+ment of the lo(er court& 1& It is 'uite unfortunate that the Insurance 3ct @R3 2326, as amended< or e%en the ne( Insurance *ode @PD #o& .12, as amended< does not contain any specific pro%ision +rossly resolutory of the prime 'uestion at hand& ection 40 of the Insurance 3ct (hich pro%ides that B@t<he insurance sha+ be applied e?clusi%ely to the proper interest of the person in (hose name it is madeB 1 cannot be %alidly sei9ed upon to hold that the mm includes the beneficiary& The (ord BinterestB hi+hly su++ests that the pro%ision refers only to the BinsuredB and not to the beneficiary, since a contract of insurance is personal in character& 2 "ther(ise, the prohibitory la(s a+ainst illicit relationships especially on property and descent (ill be rendered nu+atory, as the same could easily be circum%ented by modes of insurance& Rather, the +eneral rules of ci%il la( should be applied to resol%e this %oid in the Insurance 2a(& 3rticle 2011 of the #e( *i%il *ode states) BThe contract of insurance is +o%erned by special la(s& .atters not expressl$ provided +or in such special laws shall be re"ulated b$ this (ode&B Ahen not other(ise specifically pro%ided for by the Insurance 2a(, the contract of life insurance is +o%erned by the +eneral rules of the ci%il la( re+ulatin+ contracts& + 3nd under 3rticle 2012 of the same *ode, Bany person (ho is forbidden from recei%in+ any donation under 3rticle 63- cannot be named beneficiary of a fife insurance policy by the person (ho cannot ma;e a donation to him& 4 *ommon$la( spouses are, definitely, barred from recei%in+ donations from each other& 3rticle 63- of the ne( *i%il *ode pro%ides) +.wph!1 The follo(in+ donations shall be %oid) 1& /hose made between persons who were "uilt$ o+ adulter$ or concubina"e at the time o+ donation% Those made bet(een persons found +uilty of the same criminal offense, in consideration thereof= 3& Those made to a public officer or his (ife, descendants or ascendants by reason of his office& In the case referred to in #o& 1, the action for declaration of nullity may be brou+ht by the spouse of the donor or donee= and the "uilt o+ the donee ma$ be proved b$ preponderance o+ evidence in the same action. 2& In essence, a life insurance policy is no different from a ci%il donation insofar as the beneficiary is concerned& 0oth are founded upon the same consideration) liberality& 3 beneficiary is li;e a donee, because from the premiums of the policy (hich the insured pays out of liberality, the beneficiary (ill recei%e the proceeds or profits of said insurance& 3s a conse'uence, the proscription in 3rticle 63- of the ne( *i%il *ode should e'ually operate in life insurance contracts& The mandate of 3rticle 2012 cannot be laid aside) any person (ho cannot recei%e a donation cannot be named as beneficiary in the life insurance policy of the person (ho cannot ma;e the donation& 5 >nder 3merican la(, a policy of life insurance is considered as a testament and in construin+ it, the courts (ill, so far as possible treat it as a (ill and determine the effect of a clause desi+natin+ the beneficiary by rules under (hich (ins are interpreted& , 3& Policy considerations and dictates of morality ri+htly :ustify the institution of a barrier bet(een common la( spouses in record to Property relations since such hip ultimately encroaches upon the nuptial and filial ri+hts of the le+itimate family There is e%ery reason to hold that the bar in donations bet(een le+itimate spouses and those bet(een ille+itimate ones should be enforced in life insurance policies since the same are based on similar consideration 3s abo%e pointed out, a beneficiary in a fife insurance policy is no different from a donee& 0oth are recipients of pure beneficence& o lon+ as mana+e remains the threshold of family la(s, reason and morality dictate that the impediments imposed upon married couple should li;e(ise be imposed upon e?tra$marital relationship& If le+itimate relationship is circumscribed by these le+al disabilities, (ith more reason should an illicit relationship be restricted by these disabilities& Thus, in .atabuena v. (ervantes, 7 this *ourt, throu+h 8ustice Fernando, said) +.wph!1 If the policy of the la( is, in the lan+ua+e of the opinion of the then 8ustice 8&0&2& Reyes of that

court @*ourt of 3ppeals<, Cto prohibit donations in fa%or of the other consort and his descendants because of and undue and improper pressure and influence upon the donor, a pre:udice deeply rooted in our ancient la(=B por$'ue no se en+anen despon:andose el uno al otro por amor 'ue han de consunoC @3ccordin+ to< the Partidas @Part I!, Tit& DI, 23A I!<, reiteratin+ the rationale C#o Mutuato amore in%icem spoliarenturC the Pandects @0;, 27, Titl& 1, De donat, inter %irum et u?orem<= then there is %ery reason to apply the same prohibiti%e policy to persons li%in+ to+ether as husband and (ife (ithout the benefit of nuptials& For it is not to be doubted that assent to such irre+ular connection for thirty years bespea;s +reater influence of one party o%er the other, so that the dan+er that the la( see;s to a%oid is correspondin+ly increased& Moreo%er, as already pointed out by >lpian @in his lib& 32 ad abinum, fr& 1<, Cit (ould not be :ust that such donations should subsist, lest the condition .f those (ho incurred +uilt should turn out to be better&C o lon+ as marria+e remains the cornerstone of our family la(, reason and morality ali;e demand that the disabilities attached to marria+e should li;e(ise attach to concubina+e& It is hardly necessary to add that e%en in the absence of the abo%e pronouncement, any other conclusion cannot stand the test of scrutiny& It (ould be to indict the frame of the *i%il *ode for a failure to apply a laudable rule to a situation (hich in its essentials cannot be distin+uished& Moreo%er, if it is at all to be differentiated the policy of the la( (hich embodies a deeply rooted notion of (hat is :ust and (hat is ri+ht (ould be nullified if such irre+ular relationship instead of bein+ %isited (ith disabilities (ould be attended (ith benefits& *ertainly a le+al norm should not be susceptible to such a reproach& If there is e%ery any occasion (here the principle of statutory construction that (hat is (ithin the spirit of the la( is as much a part of it as (hat is (ritten, this is it& "ther(ise the basic purpose discernible in such codal pro%ision (ould not be attained& Ahate%er omission may be apparent in an interpretation purely literal of the lan+ua+e used must be remedied by an adherence to its a%o(ed ob:ecti%e& 7& Ae do not thin; that a con%iction for adultery or concubina+e is e?acted before the disabilities mentioned in 3rticle 63- may effectuate& More specifically, (ith record to the disability on Bpersons (ho (ere +uilty of adultery or concubina+e at the time of the donation,B 3rticle 63- itself pro%ides) +.wph!1 In the case referred to in #o& 1, the action for declaration of nullity may be brou+ht by the spouse of the donor or donee= and the "uilt$ o+ the donee ma$ be proved b$ preponderance o+ evidence in the same action. The underscored clause neatly con%eys that no criminal con%iction for the offense is a condition precedent& In fact, it cannot e%en be from the afore'uoted pro%ision that a prosecution is needed& "n the contrary, the la( plainly states that the +uilt of the party may be pro%ed Bin the same actin+ for declaration of nullity of donation& 3nd, it (ould be sufficient if e%idence preponderates upon the +uilt of the consort for the offense indicated& The 'uantum of proof in criminal cases is not demanded& In the ca( before >s, the re'uisite proof of common$la( relationship bet(een the insured and the beneficiary has been con%eniently supplied by the stipulations bet(een the parties in the pre$trial conference of the case& It case a+reed upon and stipulated therein that the deceased insured 0uena%entura *& 1brado (as married to Pascuala 1brado (ith (hom she has si? le+itimate children= that durin+ his lifetime, the deceased insured (as li%in+ (ith his common$la( (ife, *arponia 1brado, (ith (hom he has t(o children& These stipulations are nothin+ less than 0udicial admissions (hich, as a conse'uence, no lon+er re'uire proof and cannot be contradicted& 8 3 +ortiori, on the basis of these admissions, a :ud+ment may be %alidly rendered (ithout +oin+ throu+h the ri+ors of a trial for the sole purpose of pro%in+ the illicit liaison bet(een the insured and the beneficiary& In fact, in that pretrial, the parties e%en a+reed Bthat a decision be rendered based on this a+reement and stipulation of facts as to (ho amon+ the t(o claimants is entitled to the policy&B 3**"RDI#E2F, the appealed :ud+ment of the lo(er court is hereby affirmed& *arponia T& 1brado is hereby declared dis'ualified to be the beneficiary of the late 0uena%entura *& 1brado in his life insurance policy& 3s a conse'uence, the

proceeds of the policy are hereby held payable to the estate of the deceased insured& *osts a+ainst *arponia T& 1brado& " "RD1R1D& /eehan1ee !(hairman#' .a1asiar' .u%o* Palma' )ernande* and 2uerrero' 33.' concur.14wph51.6t