Agapay vs. Palang GR No.

116668, July 28, 1997

FACTS: Miguel Palang contracted marriage with Carlina in
Pangasinan on 1949. He left to work in Hawaii a few months
after the wedding. Their only child Herminia was born in May
1950. The trial court found evident that as early as 1957,
Miguel attempted to Divorce Carlina in Hawaii. When he
returned for good in 1972, he refused to lived with Carlina
and stayed alone in a house in Pozzorubio Pangasinan.

The 63 year old Miguel contracted a subsequent

marriage with 19 year old Erlinda Agapay, herein petitioner.
2 months earlier, they jointly purchased a parcel of
agricultural land located at Binalonan Pangasinan. A house
and lot in the same place was likewise purchased. On the
other hand, Miguel and Carlina executed a Deed of Donation
as a form of compromise agreement and agreed to donate
their conjugal property consisting of 6 parcels of land to their
child Herminia.
Miguel and Erlindas cohabitation produced a son
named Kristopher.
In 1979, they were convicted of
concubinage upon Carlinas complaint. 2 years later, Miguel
died. Carlina and her daughter instituted this case for
recovery of ownership and possession with damages against
petitioner. They sought to get back the land and the house
and lot located at Binalonan allegedly purchase by Miguel
during his cohabitation with petitioner. The lower court
dismissed the complaint but CA reversed the decision.
ISSUE: Whether the agricultural land and the house and lot
should be awarded in favor of Erlinda Agapay.
HELD: The sale of the riceland on May 17, 1973, was made
in favor of Miguel and Erlinda. However, their marriage is
void because of the subsisting marriage with Carlina. Only
the properties acquired by both parties through their actual
joint contribution shall be owned by them in proportion to

their respective contributions. It is required that there be an

actual contribution. If actual contribution is not proved, there
will be no co-ownership and no presumption of equal shares.
Erlinda established in her testimony that she was
engaged in the business of buy and sell and had a sari-sari
store. However, she failed to persuade the court that she
actually contributed money to but the subjected riceland.
When the land was acquired, she was only around 20 years
old compared to Miguel who was already 64 years old and a
pensioner of the US Government.
Considering his
youthfulness, its unrealistic how she could have contributed
the P3,750 as her share. Thus, the court finds no basis to
justify the co-ownership with Miguel over the same. Hence,
the Riceland should, as correctly held by CA, revert to the
conjugal partnership property of the deceased and Carlina.

It is immaterial that Miguel and Carlina previously

agreed to donate their conjugal property in favor of Herminia.
Separation of property between spouses during the marriage
shall not take place except by judicial order or without
judicial conferment when there is an express stipulation in
the marriage settlements. The judgment resulted from the
compromise was not specifically for separation of property
and should not be so inferred.
With respect to the house and lot, Atty Sagun, notary
public who prepared the deed of conveyance for the property
revealed the falshood of Erlindas claim that she bought such
property for P20,000 when she was 22 years old. The lawyer
testified that Miguel provided the money for the purchase
price and directed Erlindas name alone be placed as the
vendee.
The transaction made by Miguel to Erlinda was
properly a donation and which was clearly void and inexistent
by express provision of the law because it was made
1

between persons guilty of adultery or concubinage at the

time of the donation. Moreover, Article 87 of the Family
Code, expressly provides that the prohibition against
donation between spouses now applies to donations between
persons living together as husband and wife without a valid
marriage, for otherwise, the condition of those who incurred
guilt would turn out to be better than those in legal union.
Arcaba vs. Tabancura Vda De Batocael GR No. 146683,
November 22, 2001
FACTS: Francisco Comille and his wife Zosima Montallana
became the registered owners of Lot No. 437-A located at
Balintawak St. and Rizal Avenue in Dipolog City, Zamboanga
del Norte in January 1956. Zosima died in 1980 hence
Francisco and his mother in law executed a deed of
extrajudicial partition with waiver of rights, where the latter
waived her share consisting of of the property in favor of
Francisco. Since Francisco do not have any children to take
care of him after his retirement, he asked Leticia, his niece,
Leticias cousin, Luzviminda and Cirila Arcaba, the petitioner,
who was then a widow and took care of Franciscos house as
well as the store inside.
According to Leticia, Francisco and Cirila were lovers
since they slept in the same room. On the other hand,
Erlinda Tabancura, another niece of Francisco claimed that
the latter told her that Cirila was his mistress. However,
Cirila defensed herself that she was a mere helper who could
enter the masters bedroom when Francisco asked her to and
that Francisco was too old for her. She denied having sexual
intercourse with Francisco. When the nieces got married,
Cirila who was then 34 year-old widow started working for
Francisco who was 75 year old widower. The latter did not
pay him any wages as househelper though her family was
provided with food and lodging.
Franciscos health
deteriorated and became bedridden. Tabancura testified that

Franciscos only source of income was the rentals from his lot
near the public streets.
In January 1991, few months before Francisco died, he
executed a Deed of Donation Inter Vivos where he ceded a
portion of Lot 437-A composed of 150 sq m., together with
his house to Cirila who accepted the same. The larger
portion of 268 sq m. was left under his name. This was made
in consideration of the 10 year of faithful services of the
petitioner. Atty Lacaya notarized the deed and was later
registered by Cirila as its absolute owner.
In Octoer 1991, Francisco died and in 1993, the lot
received by Cirila had a market value of P57,105 and
assessed value of P28,550. The decedents nephews and
nieces and his heirs by intestate succession alleged that
Cirila was the common-law wife of Francisco.
ISSUE: Whether or not the deed of donation inter vivos
executed by Francisco in Arcabas favor was valid.
HELD: The court in this case considered a sufficient proof of
common law relationship wherein donation is not valid. The
conclusion was based on the testimony of Tabancura and
certain documents bearing the signature of Cirila Comille
such as application for business permit, sanitary permit and
the death certificate of Francisco. Also, the fact that Cirila
did not demand her wages is an indication that she was not
simply a caregiver employee.
Cohabitation means more than sexual intercourse,
especially when one of the parties is already old and may no
longer be interested in sex at the very least, cohabitation is a
public assumption of men and women holding themselves
out to the public as such.
Hence, the deed of donation by Francisco in favor of
Cirila is void under Art. 87 of the Family Code.
BA Finance Corp vs CA GR 61464, May 28 1988
2

FACTS: Augusto Yulo secured a loan from the petitioner in

the amount of P591,003.59 as evidenced by a promissory
note he signed in his own behalf and as a representative of
A&L Industries. Augusto presented an alleged special power
of attorney executed by his wife, Lily Yulo, who managed the
business and under whose name the said business was
registered, purportedly authorized the husband to procure
the loan and sign the promissory note. 2months prior the
procurement of the loan, Augusto left Lily and their children
which in turn abandoned their conjugal home. When the
obligation became due and demandable, Augusto failed to
pay the same.
The petitioner prayed for the issuance of a writ of
attachment alleging that said spouses were guilty of fraud
consisting of the execution of Deed of Assignment assigning
the rights, titles and interests over a construction contract
executed by and between the spouses and A. Soriano
Corporation. The writ hereby prayed for was issued by the
trial court and not contented with the order, petitioner filed a
motion for the examination of attachment debtor alleging
that the properties attached by the sheriff were not sufficient
to secure the satisfaction of any judgment which was likewise
granted by the court.
ISSUE: WON A&L Industries can be held liable for the
obligations contracted by the husband.
HELD: A&L Industries is a single proprietorship, whose
registered owner is Lily Yulo. The said proprietorship was
established during the marriage and assets were also
acquired during the same. Hence, it is presumed that the
property forms part of the conjugal partnership of the
spouses and be held liable for the obligations contracted by
the husband. However, for the property to be liable, the
obligation contracted by the husband must have redounded
to the benefit of the conjugal partnership. The obligation was
contracted by Augusto for his own benefit because at the

time he incurred such obligation, he had already abandoned

his family and left their conjugal home. He likewise made it
appear that he was duly authorized by his wife in behalf of
the company to procure such loan from the petitioner.
Clearly, there must be the requisite showing that some
advantage accrued to the welfare of the spouses.
Thus, the Court ruled that petitioner cannot enforce
the obligation contracted by Augusto against his conjugal
properties with Lily. Furthermore, the writ of attachment
cannot be issued against the said properties and that the
petitioner is ordered to pay Lily actual damages amounting to
P660,000.00.
PNB vs. CA et al G.R. No. 121597 June 29, 2001
FACTS: The spouses Chua were the owners of a parcel of
land covered by a TCT and registered in their names. Upon
the husbands death, the probate court appointed his son,
private respondent Allan as special administrator of the
deceaseds intestate estate. The court also authorized Allan
to obtain a loan accommodation from PNB to be secured by a
real estate mortgage over the above-mentioned parcel of
land, which Allan did for P450,000.00 with interest.
For failure to pay the loan in full, the bank
extrajudicially foreclosed the real estate mortgage. During
the auction, PNB was the highest bidder. However, the loan
having a payable balance, to claim this deficiency, PNB
instituted an action with the RTC, Balayan, Batangas, against
both Mrs. Chua and Allan.
The RTC rendered its decision, ordering the dismissal
of PNBs complaint. On appeal, the CA affirmed the RTC
decision by dismissing PNBs appeal for lack of merit.
Hence, the present petition for review on certiorari
under Rule 45 of the Rules of Court.

ISSUE: The WON it was error for the CA to rule that petitioner
may no longer pursue by civil action the recovery of the
balance of indebtedness after having foreclosed the property
securing the same.
HELD: petition is DENIED. The assailed decision of the CA is
AFFIRMED.
No. Petitioner relies on Prudential Bank v. Martinez,
189 SCRA 612, 615 (1990), holding that in extrajudicial
foreclosure of mortgage, when the proceeds of the sale are
insufficient to pay the debt, the mortgagee has the right to
recover the deficiency from the mortgagor.
However, it must be pointed out that petitioners cited
cases involve ordinary debts secured by a mortgage. The
case at bar, we must stress, involves a foreclosure of
mortgage arising out of a settlement of estate, wherein the
administrator mortgaged a property belonging to the estate
of the decedent, pursuant to an authority given by the
probate court. As the CA correctly stated, the Rules of Court
on Special Proceedings comes into play decisively. The
applicable rule is Section 7 of Rule 86 of the Revised Rules of
Court ( which PNB contends is not.)
In the present case it is undisputed that the conditions
under the aforecited rule have been complied with [see
notes]. It follows that we must consider Sec. 7 of Rule 86,
appropriately applicable to the controversy at hand, which in
summary [and case law as well] grants to the mortgagee
three distinct, independent and mutually exclusive remedies
that can be alternatively pursued by the mortgage creditor
for the satisfaction of his credit in case the mortgagor dies,
among them:
(1) to waive the mortgage and claim the entire debt from the
estate of the mortgagor as an ordinary claim;
(2) to foreclose the mortgage judicially and prove any
deficiency as an ordinary claim; and

(3) to rely on the mortgage exclusively, foreclosing the same

at any time before it is barred by prescription without right to
file a claim for any deficiency.
Clearly petitioner herein has chosen the mortgagecreditors option of extrajudicially foreclosing the mortgaged
property of the Chuas. This choice now bars any subsequent
deficiency claim against the estate of the deceased.
Petitioner may no longer avail of the complaint for the
recovery of the balance of indebtedness against said estate,
after petitioner foreclosed the property securing the
mortgage in its favor. It follows that in this case no further
liability remains on the part of respondents and the
deceaseds estate.
NOTES:
Section 7, Rule 86 of the Rules of Court, which states that:
Sec. 7. Rule 86. Mortgage debt due from estate. A creditor
holding a claim against the deceased secured by mortgage
or other collateral security, may abandon the security and
prosecute his claim in the manner provided in this rule, and
share in the general distribution of the assets of the estate;
or he may foreclose his mortgage or realize upon his
security, by action in court, making the executor or
administrator a party defendant, and if there is a judgment
for a deficiency, after the sale of the mortgaged premises, or
the property pledged, in the foreclosure or other proceeding
to realize upon the security, he may claim his deficiency
judgment in the manner provided in the preceding section; or
he may rely upon his mortgage or other security alone and
foreclose the same at any time within the period of the
statute of limitations, and in that event he shall not be
admitted as a creditor, and shall receive no share in the
distribution of the other assets of the estate; but nothing
herein contained shall prohibit the executor or administrator
from redeeming the property mortgaged or pledged by
paying the debt for which it is hold as security, under the
4

direction of the court if the court shall adjudge it to be for the

interest of the estate that such redemption shall be made.
To begin with, it is clear from the text of Section 7, Rule 89,
that once the deed of real estate mortgage is recorded in the
proper Registry of Deeds, together with the corresponding
court order authorizing the administrator to mortgage the
property, said deed shall be valid as if it has been executed
by the deceased himself. Section 7 provides in part:
Sec. 7. Rule 89. Regulations for granting authority to sell,
mortgage, or otherwise encumber estate The court having
jurisdiction of the estate of the deceased may authorize the
executor or administrator to sell personal estate, or to sell,
mortgage, or otherwise encumber real estate, in cases
provided by these rules when it appears necessary or
beneficial under the following regulations:
xxx
(f) There shall be recorded in the registry of deeds of the
province in which the real estate thus sold, mortgaged, or
otherwise encumbered is situated, a certified copy of the
order of the court, together with the deed of the executor or
administrator for such real estate, which shall be valid as if
the deed had been executed by the deceased in his lifetime.
Metrobank, et al. v. Jose Tan, et al., G.R. No. 163712,
November 30, 2006
No presumption of conjugality.
In Metrobank, et al. v. Jose Tan, et al., G.R. No. 163712,
November 30, 2006, a property was registered under the
names Jose Tan married to Eliza Go Tan. The husband
contracted an obligation secured by a mortgage over the
property. Since the husband failed to pay, there was
foreclosure of the mortgage which was objected to by the
wife on the ground that the property was mortgaged without
her consent, hence, it is void contending that a conjugal

property cannot be mortgaged without the consent of the

spouse.
In brushing aside the contention, the SC
Held: The lack of consent to the mortgage covering the title
in question would not render the encumbrance void under
the second paragraph of Article 124 of the Family Code. For
proof is wanting that the property covered by the title is
conjugal that it was acquired during respondents marriage
which is what would give rise to the presumption that it is
conjugal property. (Article 116, F.C.). The statement in the
title that the property is registered in accordance with the
provisions of Section 103 of the Property Registration Decree
in the name of JOSE B. TAN, of legal age, married to Eliza Go
Tan does not prove or indicate that the property is conjugal.
In Ruiz v. CA, G.R. No. 146942, April 22, 2003, 401 SCRA 410,
it was ruled that the phrase married to is merely
descriptive of the civil status of a person and should not be
construed to mean that the spouse is also a registered owner.
Furthermore, registration of the property is not proof that
such property was acquired during the marriage, and thus, is
presumed to be conjugal. The property could have been
acquired by a spouse while he was still single, and registered
only after the marriage. Acquisition of title and registration
thereof are two different acts. The presumption under Article
116 of the Family Code that properties acquired during the
marriage are presumed to be conjugal cannot apply in the
instant case. Before such presumption can apply, it must first
be established that the property was in fact acquired during
the marriage. In other words, proof of acquisition during the
marriage is a condition sine qua non for the operation of the
presumption in favor of conjugal ownership. No such proof
was offered nor presented in the case at bar.
Pelayo vs. Perez G.R. No. 141323
Facts: David Pelayo through a Deed of Absolute Sale
executed a deed of sale and transferred to Melki Perez two
5

parcel of agricultural lands. Loreza Pelayo and another one

whose signature is eligible witnesses such execution of deed.
Loreza signed only on the third page in the space provided
for witnesses, as such, Perez application was denied.
Perez asked Loreza to sign on the first and should pages of
the deed of sale but she refused. He then filed a complaint
for specific performance against the Pelayo spouses.
The spouses moved to dismiss the complaint on the ground
for lack of marital consent as provided by art166 of the Civil
Code.
Issue: Whether or not the deed of sale was null and viol for
lack of marital consent.
Held: Under Art 173, in relation to Art166, both of the NCC,
W/C was still in effect on January 11, 1988 when the deed in
question was executed, the lack of marital consent to the
disposition of conjugal property does not make the contract
viol of initio but Merely violable. Said provisions of law
provide:
Art 166. Unless the wife has been declared a non compas
mentis or a spendthrift, or is under civil interdiction or is
confined in a leprosarium, the husband cannot alienate or
encumber any real property not the conjugal property w/o
the wifes consent. It she refuses unreasonable to give her
consent, the court may compel her to grant the same.
Art 173. The wife may during the marriage and w/in 10 years
the transaction questioned, ask the court for the annulment
of any contract of the husband w/c tends to defraud her or
impair interest in the conjugal partnership property. Should
the wife fail to exercise this right she her heir, after the
dissolution of the marriage may demand the value of
property fraudulently alienated by the husband.
HOMEOWNERS SAVINGS & LOAN BANK vs. MIGUELA C.
DAILO, G.R. No. 153802 March 11, 2005

FACTS: Miguela Dailo and Marcelino Dailo, Jr were married on

August 8, 1967. During their marriage the spouses purchased
a house and lot situated at San Pablo City from a certain
Dalida. The subject property was declared for tax assessment
purposes The Deed of Absolute Sale, however, was executed
only in favor of the late Marcelino Dailo, Jr. as vendee thereof
to the exclusion of his wife.
Marcelino Dailo, Jr. executed a Special Power of
Attorney (SPA) in favor of one Gesmundo, authorizing the
latter to obtain a loan from petitioner Homeowners Savings
and Loan Bank to be secured by the spouses Dailos house
and lot in San Pablo City. Pursuant to the SPA, Gesmundo
obtained a loan from petitioner. As security therefor,
Gesmundo executed on the same day a Real Estate Mortgage
constituted on the subject property in favor of petitioner. The
abovementioned transactions, including the execution of the
SPA in favor of Gesmundo, took place without the knowledge
and consent of respondent.[
Upon maturity, the loan remained outstanding. As a
result,
petitioner
instituted
extrajudicial
foreclosure
proceedings on the mortgaged property. After the
extrajudicial sale thereof, a Certificate of Sale was issued in
favor of petitioner as the highest bidder. After the lapse of
one year without the property being redeemed, petitioner
consolidated the ownership thereof by executing an Affidavit
of Consolidation of Ownership and a Deed of Absolute Sale.
In the meantime, Marcelino Dailo, Jr. died. In one of her
visits to the subject property, Miguela learned that petitioner
had already employed a certain Brion to clean its premises
and that her car, a Ford sedan, was razed because Brion
allowed a boy to play with fire within the premises.
Claiming that she had no knowledge of the mortgage
constituted on the subject property, which was conjugal in
nature, respondent instituted with the RTC San Pablo City a
Civil Case for Nullity of Real Estate Mortgage and Certificate
6

of Sale, Affidavit of Consolidation of Ownership, Deed of Sale,

Reconveyance with Prayer for Preliminary Injunction and
Damages against petitioner. In the latters Answer with
Counterclaim, petitioner prayed for the dismissal of the
complaint on the ground that the property in question was
the exclusive property of the late Marcelino Dailo, Jr.
After trial on the merits, the trial court rendered a
Decision declaring the said documents null and void and
further ordered the defendant is ordered to reconvey the
property subject of this complaint to the plaintiff, to pay the
plaintiff the sum representing the value of the car which was
burned, the attorneys fees, moral and exemplary damages.
The appellate court affirmed the trial courts Decision,
but deleted the award for damages and attorneys fees for
lack of basis. Hence, this petition
ISSUE: 1. WON THE MORTGAGE CONSTITUTED BY THE LATE
MARCELINO DAILO, JR. ON THE SUBJECT PROPERTY AS COOWNER THEREOF IS VALID AS TO HIS UNDIVIDED SHARE.
2. WON THE CONJUGAL PARTNERSHIP IS LIABLE FOR THE
PAYMENT OF THE LOAN OBTAINED BY THE LATE MARCELINO
DAILO, JR. THE SAME HAVING REDOUNDED TO THE BENEFIT
OF THE FAMILY.
HELD: the petition is denied.
1. NO. Article 124 of the Family Code provides in part:
ART. 124. The administration and enjoyment of the conjugal
partnership property shall belong to both spouses jointly. . . .
In the event that one spouse is incapacitated or
otherwise unable to participate in the administration of the
conjugal properties, the other spouse may assume sole
powers of administration. These powers do not include the
powers of disposition or encumbrance which must have the
authority of the court or the written consent of the other

spouse. In the absence of such authority or consent, the

disposition or encumbrance shall be void. . . .
In applying Article 124 of the Family Code, this Court
declared that the absence of the consent of one renders the
entire sale null and void, including the portion of the conjugal
property pertaining to the husband who contracted the sale.
Respondent and the late Marcelino. were married on
August 8, 1967. In the absence of a marriage settlement, the
system of relative community or conjugal partnership of
gains governed the property relations between respondent
and her late husband. With the effectivity of the Family Code
on August 3, 1988, Chapter 4 on Conjugal Partnership of
Gains in the Family Code was made applicable to conjugal
partnership of gains already established before its effectivity
unless vested rights have already been acquired under the
Civil Code or other laws.
The rules on co-ownership do not even apply to the
property relations of respondent and the late Marcelino even
in a suppletory manner. The regime of conjugal partnership
of gains is a special type of partnership, where the husband
and wife place in a common fund the proceeds, products,
fruits and income from their separate properties and those
acquired by either or both spouses through their efforts or by
chance. Unlike the absolute community of property wherein
the rules on co-ownership apply in a suppletory manner, the
conjugal partnership shall be governed by the rules on
contract of partnership in all that is not in conflict with what
is expressly determined in the chapter (on conjugal
partnership of gains) or by the spouses in their marriage
settlements. Thus, the property relations of respondent and
her late husband shall be governed, foremost, by Chapter 4
on Conjugal Partnership of Gains of the Family Code and,
suppletorily, by the rules on partnership under the Civil Code.
In case of conflict, the former prevails because the Civil Code
7

provisions on partnership apply only when the Family Code is

silent on the matter.
The basic and established fact is that during his
lifetime, without the knowledge and consent of his wife,
Marcelino constituted a real estate mortgage on the subject
property, which formed part of their conjugal partnership. By
express provision of Article 124 of the Family Code, in the
absence of (court) authority or written consent of the other
spouse, any disposition or encumbrance of the conjugal
property shall be void.

The aforequoted provision does not qualify with

respect to the share of the spouse who makes the disposition
or encumbrance in the same manner that the rule on coownership under Article 493 of the Civil Code does. Where
the law does not distinguish, courts should not distinguish.
Thus, both the trial court and the appellate court are correct
in declaring the nullity of the real estate mortgage on the
subject property for lack of respondents consent.
2. NO. Under Article 121 of the Family Code, [T]he conjugal
partnership shall be liable for: . . .
(1)
Debts and obligations contracted by either spouse
without the consent of the other to the extent that the family
may have been benefited; . . . .
Certainly, to make a conjugal partnership respond for a
liability that should appertain to the husband alone is to
defeat and frustrate the avowed objective of the new Civil
Code to show the utmost concern for the solidarity and wellbeing of the family as a unit.[
The burden of proof that the debt was contracted for
the benefit of the conjugal partnership of gains lies with the
creditor-party litigant claiming as such. Ei incumbit probatio
qui dicit, non qui negat (he who asserts, not he who denies,

must prove). Petitioners sweeping conclusion that the loan

obtained by the late Marcelino to finance the construction of
housing units without a doubt redounded to the benefit of his
family, without adducing adequate proof, does not persuade
this Court. Consequently, the conjugal partnership cannot be
held liable for the payment of the principal obligation.
NOTES: In addition, a perusal of the records of the case
reveals that during the trial, petitioner vigorously asserted
that the subject property was the exclusive property of the
late Marcelino Dailo, Jr. Nowhere in the answer filed with the
trial court was it alleged that the proceeds of the loan
redounded to the benefit of the family. Even on appeal,
petitioner never claimed that the family benefited from the
proceeds of the loan. When a party adopts a certain theory in
the court below, he will not be permitted to change his
theory on appeal, for to permit him to do so would not only
be unfair to the other party but it would also be offensive to
the basic rules of fair play, justice and due process. A party
may change his legal theory on appeal only when the factual
bases thereof would not require presentation of any further
evidence by the adverse party in order to enable it to
properly meet the issue raised in the new theory.
SECURITY BANK AND TRUST COMPANY v. MAR TIERRA
CORP, WILFRIDO MARTINEZ, MIGUEL LACSON, and
RICARDO LOPA, November 29, 2006 (508 SCRA 419)
FACTS: Respondent Mar Tierra Corporation, through its
president, Wilfrido C. Martinez, applied for a P12,000,000
credit accommodation with petitioner Security Bank and Trust
Company. Petitioner approved the application and entered
into a credit line agreement with respondent corporation. It
was secured by an indemnity agreement executed by
individual respondents Wilfrido C. Martinez, Miguel J. Lacson
and Ricardo A. Lopa who bound themselves jointly and
severally with respondent corporation for the payment of the
loan.
8

Respondent corporation was not able to pay all its debt

balance as it suffered business reversals, eventually ceasing
operations. Petitioner filed a complaint against respondent
corp and individual respondents.
RTC issued a writ of attachment on all real and
personal properties of respondent corporation and individual
respondent Martinez including the conjugal house and lot of
the spouses but it found that it did not redound to the benefit
of his family, hence, it ordered the lifting of the attachment
on the conjugal house and lot of the spouses Martinez.
Petitioner appealed to CA. It affirmed RTC decision.
Petitioned to SC.
ISSUE: WON the conjugal partnership may be held liable for
an indemnity agreement entered into by the husband to
accommodate a third party
HELD: No. SC upheld the CA. Under Article 161(1) of the Civil
Code, the conjugal partnership is liable for all debts and
obligations contracted by the husband for the benefit of the
conjugal partnership.
The court ruled in Luzon Surety Co., Inc. v. de Garcia
that, in acting as a guarantor or surety for another, the
husband does not act for the benefit of the conjugal
partnership as the benefit is clearly intended for a third party.

In Ayala Investment and Development Corporation v.

Court of Appeals, we ruled that, if the husband himself is the
principal obligor in the contract, i.e., the direct recipient of
the money and services to be used in or for his own business
or profession, the transaction falls within the term
obligations for the benefit of the conjugal partnership. In
other words, where the husband contracts an obligation on
behalf of the family business, there is a legal presumption

that such obligation redounds to the benefit of the conjugal

partnership.
On the other hand, if the money or services are given
to another person or entity and the husband acted only as a
surety or guarantor, the transaction cannot by itself be
deemed an obligation for the benefit of the conjugal
partnership. It is for the benefit of the principal debtor and
not for the surety or his family.
In the case at bar, the principal contract, the credit line
agreement between petitioner and respondent corporation,
was solely for the benefit of the latter. The accessory
contract (the indemnity agreement) under which individual
respondent Martinez assumed the obligation of a surety for
respondent corporation was similarly for the latters benefit.
Petitioner had the burden of proving that the conjugal
partnership of the spouses Martinez benefited from the
transaction. It failed to discharge that burden.
SECURITY BANK AND TRUST COMPANY v. MAR TIERRA
CORP, WILFRIDO MARTINEZ, MIGUEL LACSON, and
RICARDO LOPA, November 29, 2006 (508 SCRA 419)
Once again in Security Bank & Trust Co. v. Mar Tierra
Corp., et al., G.R. No. 143382, November 29, 2006 (Corona,
J), the basic question on the liability of the conjugal
partnership for an indemnity agreement entered into by the
husband to accommodate a third party was asked. It appears
that Mar Tierra Corporation entered into a credit line
agreement with SBTC. Wilfredo Martinez and others executed
an indemnity agreement holding themselves solidarily liable
for such obligation. There was no payment by the
corporation, hence, a suit for collection of sum of money was
filed. Judgment was rendered and it became final and
executory. May the conjugal properties of Martinez and his
wife be made to answer for such obligation? Why?

Held: No. In acting as a guarantor or surety for another, the

husband did not act for the benefit of the conjugal
partnership but for a third party. (Luzon Surety Co., Inc. v. de
Garcia, 140 Phil. 509 (1969)).
Under Article 121(2) of the Family Code the conjugal
partnership is liable for all debts and obligations contracted
by the husband for the benefit of the conjugal partnership.
In Ayala Investment and Development Corp. v. Court
of Appeals, 349 Phil. 942 (1998) it was ruled that, if the
husband himself is the principal obligor in the contract, i.e.,
the direct recipient of the money and services to be used in
or for his own business or profession, the transaction falls
within the term obligations for the benefit of the conjugal
partnership. In other words, where the husband contracts an
obligation on behalf of the family business, there is a legal
presumption that such obligation redounds to the benefit of
the conjugal partnership. (Security Bank & Trust Co. v. Mar
Tierra Corp., et al., G.R No. 143382, November 29, 2006).
On the other hand, if the money or services are given
to another person or entity and the husband acted only as a
surety or guarantor, the transaction cannot by itself be
deemed an obligation for the benefit of the conjugal
partnership. It is for the benefit of the principal debtor and
not for the surety or his family. No presumption is raised that,
when a husband enters into a contract of surety or
accommodation agreement, it is for the benefit of the
conjugal partnership. Proof must be presented to establish
the benefit redounding to the conjugal partnership. In the
absence of any showing of benefit received by it, the
conjugal partnership cannot be held liable on an indemnity
agreement executed by the husband to accommodate a third
party.
In this case, the principal contract, the credit line
agreement between petitioner and respondent corporation,
was solely for the benefit of the latter. The accessory

contract (the indemnity agreement) under which individual

respondent Martinez assumed the obligation of a surety for
respondent corporation was similarly for the latters benefit.
Petitioner had the burden of proving that the conjugal
partnership of the spouses Martinez benefited from the
transaction. It failed to discharge that burden.

To hold the conjugal partnership liable for an

obligation pertaining to the husband alone defeats the
objective of the Civil Code to protect the solidarity and well
being of the family as a unit. (Ching v. CA, G.R. No. 124642,
February 24, 2004, 423 SCRA 356). The underlying concern
of the law is the conservation of the conjugal partnership.
(Ayala Investments & Dev. Corp. v. CA). Hence, it limits the
liability of the conjugal partnership only to debts and
obligations contracted by the husband for the benefit of the
conjugal partnership.
Villanueva vs. Court of Appeals, G.R. No. 143286 April
14, 2004
FACTS: On 13 October 1988, Eusebia Retuya filed a
complaint before the trial court against her husband Nicolas
Retuya, Pacita Villanueva and Nicolas son with Pacita,
Procopio Villanueva. Eusebia sought the reconveyance from
Nicolas and Pacita of several properties (subject properties),
claiming that such are her conjugal properties with Nicolas.
Plaintiff Eusebia, is the legal wife of defendant Nicolas,
having been married on October 7, 1926. Out of the lawful
wedlock, they begot five (5) children. Spouses Retuya resided
at Mandaue City. During their marriage, they acquired real
properties and all improvements situated in Mandaue City,
and Consolacion, Cebu. Nicolas is the co-owner of a parcel of
land situated in Mandaue City which he inherited from his
parents Esteban Retuya and Balbina Solon as well as the
purchasers of hereditary shares of approximately eight (8)
10

parcels of land in Mandaue City. Some of the properties earn

income from coconuts leased to corporations

been acquired during the marriage before they are presumed

conjugal.

In 1945, Nicolas no longer lived with his legitimate

family and cohabited with defendant, Pacita Villanueva,
wherein Procopio Villanueva, is their illegitimate son. Nicolas,
then, was the only person who received the income of the
properties. Pacita, from the time she started living in
concubinage with Nicolas, has no occupation. She had no
properties of her own from which she could derive income.
From the time Nicolas suffered stroke until the present, his
illegitimate son is already the one who has been receiving
the income of his properties

Nicolas and Eusebia were married on 7 October 1926.

Nicolas and Pacita started cohabiting in 1936. Eusebia died
on 23 November 1996. Pacita and Nicolas were married on
16 December 1996. Petitioners themselves admit that Lot No.
152 was purchased on 4 October 1957. The date of
acquisition of Lot No. 152 is clearly during the marriage of
Nicolas and Eusebia.

Settlement between parties was asked but not met.

Trial court in favor of Eusebia Natuya. Petitioners appealed.
Eusebia died, and was then substituted by her heirs. CA
upheld trial courts decision
ISSUE: Whether or not the subject properties acquired during
the marriage between Eusebia and Procopio are conjugal
HELD: YES, they are conjugal. Petition denied; decision of CA
affirmed
RATIO: The Family Code provisions on conjugal partnerships
govern the property relations between Nicolas and Eusebia
even if they were married before the effectivity of Family
Code.
Article 105 of the Family Code explicitly mandates that
the Family Code shall apply to conjugal partnerships
established before the Family Code without prejudice to
vested rights already acquired under the Civil Code or other
laws. Thus, under the Family Code, if the properties are
acquired during the marriage, the presumption is that they
are conjugal. The burden of proof is on the party claiming
that they are not conjugal. This is counter-balanced by the
requirement that the properties must first be proven to have

Since the subject properties, including Lot No. 152,

were acquired during the marriage of Nicolas and Eusebia,
the presumption under Article 116 of the Family Code is that
all these are conjugal properties of Nicolas and Eusebia.
Villanueva vs. IAC GR No. 67582, October 29, 1987
FACTS: Modesto Aranas, husband of Victoria, inherited a land
from his father. Dorothea and Teodoro, Modestos illegitimate
children, borrowed money from private respondent Jesus
Bernas, mortgaging as collateral their fathers property. In
the loan agreement, Aranas described themselves as the
absolute co-owners. Dorothea and Teodoro failed to pay the
loan resulting to extrajudicial foreclosure of mortgage in
1977 and thereafter Bernas acquired the land as the highest
bidder.
Aftewards, the Aranases executed a deed of
extrajudicial partition in 1978, in which they adjudicated the
same land unto themselves in equal share pro-indiviso.
Bernas then consolidated his ownership over the lot when the
mortgagors failed to redeem it withn the reglementary
period, and had the title in the name of Modesto cancelled
and another TCT issued in his name.
In 1978, petitioner Consolacion Villanueva and
Raymundo Aranas filed a complaint against respondents
spouses Jesus and Remedios Bernas, for the cancellation of
the TCT under the name of the Bernases, and they be
declared co-owners of the land. Petitioner alleged that
11

spouses Modesto and Victoria in 1987 and 1958 executed 2

separate wills: first bequeathing to Consolacion and
Raymundo and to Dorothea and Teodoro, in equal shares pro
diviso, all of said Victorias shares from the conjugal
partnership property; and second Modestos interests in his
conjugal partnership with Victoria as well as his separate
properties bequeathed to Dorothea and Teodoro. Trial court
dismissed the complaint, declaring herein respondents as the
legal owners of the disputed property. IAC likewise affirmed
the lower courts decision.
ISSUE: WON Villanueva had a right over the land and the
improvements thereon made by Victoria who rendered the lot
as conjugal property.
HELD: The land was not a conjugal partnership property of
Victoria and Modesto. It was Modestos exclusive property
since he inherited it from his parents. Moreover, since
Victoria died ahead of Modesto, Victoria did not inherit said
lot from him and therefore had nothing of the land to
bequeath by will of otherwise to Consolacion.
Article 158 of the Civil Code says that improvements,
whether for utility or adornment made on the separate
property of the spouses through advancements from the
partnership or through the industry of either spouse belong
to the conjugal partnership, and buildings constructed at the
expense of the partnership during the marriage on land
belonging to one of the spouses also pertain to the
partnership, but the value of the land shall be reimbursed to
the spouse who owns the same.
There was no proof presented by Villanueva. Such
proof is needed at the time of the making or construction of
the improvements and the source of the funds used thereof
in order to determine the character of the improvements as
belonging to the conjugal partnership or to one spouse
separately. What is certain is that the land on which the
improvements stand was the exclusive property of Modesto

and that where the property is registered in the name of one

spouse only and there is no showing of when precisely the
property was acquired, the presumption is that is belongs
exclusively to said spouse. It is not therefore possible to
declare the improvements to be conjugal in character.
Furthermore, Bernas mode of acquisition of ownership
over the property appears in all respect to be regular,
untainted by any defect whatsoever. Bernas must therefore
be deemed to have acquired indefeasible and clear title to
the lot which cannot be defeated or negated by claims
subsequently arising and of which he had no knowledge or
means of knowing prior to their assertion and ventilation.
GENATO v. DE LORENZO, 23 SCRA 618
Donation in a public document
The delivery by the donor and the acceptance by done must
be simultaneous and the acceptance by a person other than
the true done must be authorized by a proper power of
attorney set forth in a public document
FACTS: The property under dispute in this case is the 530
shares of stocks of Genato Commercal Corporation, which
has P100 par value, of the deceased Simona B. De Genato
(Director and secretary-treasurer of the said company). The
petitioners herein, 2 heirs of Simona, are claiming that they
own 530 shares of stocks of Genato Commercal Corporation
because of the donation made by Simona to them.
Respondents (other remaining heirs), however, are
trying to recover from the petitioners, their co-heirs, the said
stocks so they can include it in the intestate estate which
should later be distributed among all the surviving children of
the decedent.
Four or five days after having Florentino Genato
elected and designated as Assitant Secretary-Treasurer of the
Corporation, 265 shares were issued in favour of Florentino
12

Genato and another 265 were issued in favour of Francisco G.

Genato. These were not presented as evidence in the course
of the trial; they were merely mentioned by Florentino
Genato in the course of his testimony as a witness.
ISSUE: Whether or not there was a valid donation?
RULING: NO. There was no valid donation for lack of proper
acceptance. Incontestably, one of the two donees was not
present at the delivery, and there is no showing that
Francisco Genato had authorized his brother, Florentino to
accept for both of them. The delivery by the donor and the
acceptance by done must be simultaneous and the
acceptance by a person other than the true done must be
authorized by a proper power of attorney set forth in a public
document. None has been claimed to exist in this case.
BPI vs. Posadas, GR No. 34583, October 22, 1931
FACTS: BPI, as administrator of the estate of deceased
Adolphe Schuetze, appealed to CFI Manila absolving
defendant, Collector of Internal Revenue, from the complaint
filed against him in recovering the inheritance tax amounting
to P1209 paid by the plaintiff, Rosario Gelano Vda de
Schuetze, under protest, and sum of P20,150 representing
the proceeds of the insurance policy of the deceased.
Rosario and Adolphe were married in January 1914.
The wife was actually residing and living in Germany when
Adolphe died in December 1927.
The latter while in
Germany, executed a will in March 1926, pursuant with its
law wherein plaintiff was named his universal heir. The
deceased possessed not only real property situated in the
Philippines but also personal property consisting of shares of
stocks in 19 domestic corporations. Included in the personal
property is a life insurance policy issued at Manila on January
1913 for the sum of $10,000 by the Sun Life Assurance
Company of Canada, Manila Branch. In the insurance policy,
the estate of the deceased was named the beneficiary

without any qualification. Rosario is the sole and only heir of

the deceased. BPI, as administrator of the decedents estate
and attorney in fact of the plaintiff, having been demanded
by Posadas to pay the inheritance tax, paid under protest.
Notwithstanding various demands made by plaintiff, Posadas
refused to refund such amount.
ISSUE: WON the plaintiff is entitled to the proceeds of the
insurance.
HELD: SC ruled that (1)the proceeds of a life-insurance policy
payable to the insured's estate, on which the premiums were
paid by the conjugal partnership, constitute community
property, and belong one-half to the husband and the other
half to the wife, exclusively; (2) if the premiums were paid
partly with paraphernal and partly conjugal funds, the
proceeds are likewise in like proportion paraphernal in part
and conjugal in part; and (3)the proceeds of a life-insurance
policy payable to the insured's estate as the beneficiary, if
delivered to the testamentary administrator of the former as
part of the assets of said estate under probate
administration, are subject to the inheritance tax according
to the law on the matter, if they belong to the assured
exclusively, and it is immaterial that the insured was
domiciled in these Islands or outside.
Hence, the defendant was ordered to return to the
plaintiff one-half of the tax collected upon the amount of
P20,150, being the proceeds of the insurance policy on the
life of the late Adolphe Oscar Schuetze, after deducting the
proportional part corresponding to the first premium.
JOCSON v. COURT OF APPEALS, February 16, 1989
(G.R. No. L-55322)
FACTS: Emilio Jocon and Alejandra Jocson were husband and
wife. The wife died first intestate then the husband followed.
Moises and Agustina are their children. Ernesto Vasquesz is
the husband of Agustina.
13

The present controversy concerns the validity of three

(3) documents executed by Emilio Jocson during his lifetime.
These documents purportedly conveyed, by sale, to Agustina
Jocson-Vasquez what apparently covers almost all of his
properties, including his one-third (1/3) share in the estate of
his wife. Petitioner Moises Jocson assails these documents
and prays that they be declared null and void and the
properties subject matter therein be partitioned between him
and Agustina as the only heirs of their deceased parents.
Petitioner claimed that the properties mentioned in
Exhibits 3 and 4 are the unliquidated conjugal properties of
Emilio Jocson and Alejandra Poblete which the former,
therefore, cannot validly sell. They say it is conjugal
properties of Emilio Jocson and Alejandra Poblete, because
they were registered in the name of Emilio Jocson, married
to Alejandra Poblete.
ISSUE: WON the property registered under the name of
Emilio Jocson, married to Alejandra Poblete is conjugal
property or exclusive property.

HELD: Exclusive. Article 60 of the CC proveides that All

property of the marriage is presumed to belong to the
conjugal partnership, unless it be proved that it pertains
exclusively to the husband or to the wife. The party who
invokes this presumption must first prove that the property in
controversy was acquired during the marriage. In other
words, proof of acquisition during the coverture is a condition
sine qua non for the operation of the presumption in favor of
conjugal ownership.
It is thus clear that before Moises Jocson may validly
invoke the presumption under Article 160 he must first
present proof that the disputed properties were acquired
during the marriage of Emilio Jocson and Alejandra Poblete.
The certificates of title, however, upon which petitioner rests

his claim is insufficient. The fact that the properties were

registered in the name of Emilio Jocson, married to
Alejandra Poblete is no proof that the properties were
acquired during the spouses coverture. Acquisition of title
and registration thereof are two different acts. It is well
settled that registration does not confer title but merely
confirms one already existing (See Torela vs. Torela, supra). It
may be that the properties under dispute were acquired by
Emilio Jocson when he was still a bachelor but were
registered only after his marriage to Alejandra Poblete, which
explains why he was described in the certificates of title as
married to the latter.
Contrary to petitioners position, the certificates of title
show, on their face, that the properties were exclusively
Emilio Jocsons, the registered owner. This is so because the
words married to preceding Alejandra Poblete are merely
descriptive of the civil status of Emilio Jocson. In other words,
the import from the certificates of title is that Emilio Jocson is
the owner of the properties, the same having been registered
in his name alone, and that he is married to Alejandra
Poblete.
MARAMBA v. LOZANO, 20 SCRA 474
Facts: On November 3, 1948, the plaintiff filed an action
against the defendant Nieves de Lozano and her husband
Pascual Lozano for the collection of a sum of money. After
trial, the court a quo on June 23, 1959 rendered its decision,
the dispositive part of which is as follows:
WHEREFORE, the court hereby renders judgment,
sentencing the defendants herein, Nieves de Lozano and
Pascual Lozano, to pay unto the herein plaintiff, Hermogenes
Maramba, the total sum of Three Thousand Five Hundred
Pesos and Seven Centavos (P3,500.07), with legal interest
thereon from date of the filing of the instant complaint until
fully paid.
14

Not satisfied with the judgment, the defendants

interposed an appeal to the Court of Appeals but the appeal
was dismissed on March 30, 1960 for failure of the
defendants to file their brief on time. After the record the
case was remanded to the court a quo, a writ of execution
was issued, and on August 18, 1960 levy was made upon a
parcel of land covered by transfer certificate title No. 8192 of
Pangasinan in the name of Nieves de Lozano. The notice of
sale at public auction was published in accordance with law
and scheduled for September 16, 1960.
On that date, however, defendant Nieves de Lozano
made a partial satisfaction of the judgment in the amount
P2,000.00, and requested for an adjournment of the sale to
October 26, 1960. On October 17, 1960, she filed amended
motion, dated October 14, alleging that on November 11,
1952, during the pendency of the case, defendant Pascual
Lozano died and that the property levied upon was her
paraphernal property, and praying that her liability be fixed
at one-half () of the amount awarded in the judgment and
that pending the resolution of the issue an order be issued
restraining the Sheriff from carrying out the auction sale
scheduled on October 26, 1960. On that date the sale
proceeded anyway, and the property of Nieves de Lozano
which has been levied upon was sold to the judgment
creditor, as the highest bidder, for the amount of P4,175.12,
the balance of the judgment debt.
Issues:
1. Whether or not the decision of the lower court dated June
23, 1959 could still be questioned;
2. Whether or not the judgment was joint; and
3. Whether or not the judgment debt could be satisfied from
the proceeds of the properties sold at public auction.
Held:

1. NO. It would entail a substantial amendment of the

decision of June 23, 1959, which has long become final and in
fact partially executed. A decision which has become final
and executory can no longer be amended or corrected by the
court except for clerical errors or mistakes, and however
erroneous it may be, cannot be disobeyed; otherwise
litigations would be endless and no questions could be
considered finally settled. The amendment sought by
appellee involves not merely clerical errors but the very
substance of the controversy. And it cannot be accomplished
by the issuance of a "nunc pro tunc" order such as that
sought in this case. The purpose of an "nunc pro tunc" is to
make a present record of an which the court made at a
previous term, but which not then recorded. It can only be
made when the ordered has previously been made, but by
inadvertence not been entered.
Now then, it is clear that the decision of June 23, 1959
does not specify the extent of the liability of each defendant.
The rule is that when the judgment does not order the
defendants to pay jointly and severally their liability is merely
joint, and none of them may be compelled to satisfy the
judgment in full. This is in harmony with Articles 1137 and
1138 of the Civil Code.
2. YES. The rule is that when the judgment does not order the
defendants to pay jointly and severally their liability is merely
joint, and none of them may be compelled to satisfy the
judgment in full. This is in harmony with Articles 1137 and
1138 of the Civil Code.
3. NO. The presumption under Article 160 of the Civil Code to
property acquired during the marriage. But in the instant
case there is no showing as to when the property in question
was acquired and hence the fact that the title is in the wife's
name alone is determinative. Furthermore, appellant himself
admits in his brief that the property in question is
paraphernal.
15

Appellant next points out that even if the land levied

upon were originally paraphernal, it became conjugal
property by virtue of the construction of a house thereon at
the expense of the common fund, pursuant to Article 158
paragraph 2 of the Civil Code. However, it has been by this
Court that the construction of a house at conjugal expense
on the exclusive property of one of the spouses does not
automatically make it conjugal. It is true that meantime the
conjugal partnership may use both in the land and the
building, but it does so not as owner but in the exercise of
the right of usufruct.
Wong vs. IAC, GR No. 70082, August 19, 1991
FACTS: Romario Henson married Katrina on January 1964.
They had 3 children however, even during the early years of
their marriage, the spouses had been most of the time living
separately. During the marriage or on about January 1971,
the husband bought a parcel of land in Angeles from his
father using the money borrowed from an officemate.
Sometime in June 1972, Katrina entered an agreement with
Anita Chan where the latter consigned the former pieces of
jewelry valued at P321,830.95. Katrina failed to return the
same within the 20 day period thus Anita demanded
payment of their value. Katrina issued in September 1972,
check of P55,000 which was dishonored due to lack of funds.
The spouses Anita Chan and Ricky Wong filed action for
collection of the sum of money against Katrina and her
husband Romarico. The reply with counterclaim filed was
only in behalf of Katrina. Trial court ruled in favor of the
Wongs then a writ of execution was thereafter issued upon
the 4 lots in Angeles City all in the name of Romarico Henson
married to Katrina Henson. 2 of the lots were sold at public
auction to Juanito Santos and the other two with Leonardo
Joson. A month before such redemption, Romarico filed an
action for annulment of the decision including the writ and
levy of execution.

ISSUE: WON debt of the wife without the knowledge of the

husband can be satisfied through the conjugal property.
HELD: The spouses had in fact been separated when the wife
entered into the business deal with Anita. The husband had
nothing to do with the business transactions of Katrina nor
authorized her to enter into such. The properties in Angeles
were acquired during the marriage with unclear proof where
the husband obtained the money to repay the loan. Hence, it
is presumed to belong in the conjugal partnership in the
absence of proof that they are exclusive property of the
husband and even though they had been living separately. A
wife may bind the conjugal partnership only when she
purchases things necessary for support of the family. The
writ of execution cannot be issued against Romarico and the
execution of judgments extends only over properties
belonging to the judgment debtor. The conjugal properties
cannot answer for Katrinas obligations as she exclusively
incurred the latter without the consent of her husband nor
they did redound to the benefit of the family. There was also
no evidence submitted that the administration of the
partnership had been transferred to Katrina by Romarico
before said obligations were incurred. In as much as the
decision was void only in so far as Romarico and the conjugal
properties concerned, Spouses Wong may still execute the
debt against Katrina, personally and exclusively.
LILIUS, ET AL. vs. THE MANILA RAILROAD COMPANY,
G.R. No. L-39587, March 24, 1934
FACTS: Lilius was driving with his wife and daughter for
sightseeing in Pagsanjan Laguna. It was his first time in the
area and he was entirely unacquainted with the conditions of
the road and had no knowledge of the existence of a railroad
crossing. Before reaching the crossing in question, there was
nothing to indicate its existence and, it was impossible to see
an approaching train. At about seven or eight meters from
the crossing the plaintiff saw an auto truck parked on the left
16

side of the road. Several people, who seemed to have

alighted from the said truck, were walking on the opposite
side. He slowed down and sounded his horn for the people to
get out of the way. With his attention thus occupied, he did
not see the crossing but he heard two short whistles.
Immediately afterwards, he saw a huge black mass fling itself
upon him, which turned out to be locomotive No. 713 of the
MRCs train. The locomotive struck the plaintiffs car right in
the center. The 3 victims were injured and were hospitalized.
Lilus filed a case against MRC in the CFI. Answering the
complaint, it denies each and every allegation thereof and,
by way of special defense, alleges that the Lilius, with the
cooperation of his wife and coplaintiff, negligently and
recklessly drove his car, and prays that it be absolved from
the complaint.
The CFI decided in favor of Lilius. The 2 parties
appealed said decision, each assigning errors on said
judgment.
ISSUE:
1) WON Manila Railroad Company is liable for damages
2) WON the sums of money fixed by the court a quo as
indemnities for damages proper:
Injuries sutained by Lilius
for injuries sustained by wife and child
for loss of domestic service of wife to husband
HELD: The judgment appealed from is affirmed in toto, with
the sole modification on interest to be added on the
indemnity in favor of Lilius.
1. YES. Upon examination of the oral as well as of the
documentary evidence, this court is of the opinion that the
accident was due to negligence on the part of the defendant-

appellant company alone, for not having had on that

occasion any semaphore at the crossing to serve as a
warning to passers-by of its existence in order that they
might take the necessary precautions before crossing the
railroad; and, on the part of its employees the flagman and
switchman, for not having remained at his post at the
crossing in question to warn passers-by of the approaching
train
Although it is probable that the defendant-appellant
entity employed the diligence of a good father of a family in
selecting its aforesaid employees, however, it did not employ
such diligence in supervising their work and the discharge of
their duties. The diligence of a good father of a family, which
the law requires in order to avoid damage, is not confined to
the careful and prudent selection of subordinates or
employees but includes inspection of their work and
supervision of the discharge of their duties.
2. a. With respect to the plaintiffs appeal, the first question
to be decided is that raised by Lilius relative to the
insufficiency of the sum of P5,000 which the trial court
adjudicated to him by way of indemnity for damages
consisting in the loss of his income as journalist and author
as a result of his illness. As to the amount of P10,000 claimed
by Lilius as damages for the loss of his wifes services in his
business, which services consisted in going over his writings,
translating them into foreign languages and acting as his
secretary, in addition to the fact that such services formed
part of the work whereby he realized a net monthly income of
P1,500, there is no sufficient evidence of the true value of
said services nor to the effect that he needed them during
her illness and had to employ a translator to act in her stead.
b. Taking into consideration the fact that the wife in the
language of the court, which saw her at the trial young
and beautiful and the big scar, which she has on her
forehead caused by the lacerated wound received by her
17

from the accident, disfigures her face and that the fracture of
her left leg has caused a permanent deformity which renders
it very difficult for her to walk, and taking into further
consideration her social standing, neither is the sum
adjudicated to her for patrimonial and moral damages,
excessive.
As to the indemnity in favor of the child neither is the
same excessive, taking into consideration the fact that the
lacerations received by her have left deep scars that
permanently disfigure her face and that the fractures of both
her legs permanently render it difficult for her to walk freely,
continuous extreme care being necessary in order to keep
her balance in addition to the fact that all of this unfavorably
and to a great extent affect her matrimonial future.
c. Lilius also seeks to recover the sum of P2,500 for the loss
of what is called Anglo-Saxon common law consortium of
his wife, that is, her services, society and conjugal
companionship, as a result of personal injuries which she
had received from the accident now under consideration.
Under the law and the doctrine of this court, one of the
husbands rights is to count on his wifes assistance. This
assistance comprises the management of the home and the
performance of household duties. However, nowadays when
women, in their desire to be more useful to society and to the
nation, are demanding greater civil rights and are aspiring to
become mans equal in all the activities of life, marriage has
ceased to create the presumption that a woman complies
with the duties to her husband and children, which the law
imposes upon her, and he who seeks to collect indemnity for
damages resulting from deprivation of her domestic services
must prove such services. In the case under consideration,
apart from the services of his wife as translator and
secretary, the value of which has not been proven, Lilius has
not presented any evidence showing the existence of
domestic services and their nature, rendered by her prior to

the accident, in order that it may serve as a basis in

estimating their value.
Furthermore, inasmuch as a wifes domestic assistance
and conjugal companionship are purely personal and
voluntary acts which neither of the spouses may be
compelled to render, it is necessary for the party claiming
indemnity for the loss of such services to prove that the
person obliged to render them had done so before he was
injured and that he would be willing to continue rendering
them had he not been prevented from so doing
NOTES:
However, in order that a victim of an accident may
recover indemnity for damages from the person liable
therefor, it is not enough that the latter has been guilty of
negligence, but it is also necessary that the said victim has
not, through his own negligence, , contributed to the
accident.

It appears that Lilius took all precautions which his skill

and the presence of his wife and child, driving his car at a
speed which prudence demanded according to the
circumstances and conditions of the road, slackening his
speed in the face of an obstacle and blowing his horn upon
seeing persons on the road. If he failed to stop, look and
listen before going over the crossing, in spite of the fact that
he was driving at 12 miles per hour after having been free
from obstacles, it was because, his attention having been
occupied in attempting to go ahead, he did not see the
crossing in question, nor anything, nor anybody indicating its
existence, as he knew nothing about it beforehand. The first
and only warning, which he received of the impending
danger, was two short blows from the whistle of the
locomotive immediately preceding the collision and when the
accident had already become inevitable.
18

Jovellanos v. CA, G.R. No. 100728 June 18, 1992

Facts: Daniel Jovellanos contracted with Philamlife a lease
and conditional sale agreement of a property. When the
agreement took place, Daniel was still married to his first
wife, Leonor, with whom he had three children. Leonor died
on January 2, 1959. On May 30, 1967, Daniel was remarried
to Annette (respondent). On December 18, 1971, Mercy
(daughter from first marriage) and her husband, built an
extension at the back of the said property. On January 8,
1975, the lease was paid and Philamlife executed a deed of
absolute sale to Daniel. The following day, he then donated
the said property to his children in the first marriage
(petitioners). On September 8, 1985, Daniel died.
Annette now claims that the said property is the
conjugal property belonging to the second marriage due to
the fact that the deed of absolute sale was dated during the
celebration of their marriage (Jan. 8, 1975).
Issue: To which marriage does the property belong to as
conjugal property?
Held: The Court held that the said property belongs to the
second marriage, but also proclaims that reimbursements
should be made to the children of the first marriage (in line
with ART 118 of the FC).
The contract entered into by Daniel and Philamlife is
specifically denominated as a "Lease and Conditional Sale
Agreement" with a lease period of twenty years. During the
twenty-year period, Daniel had only the right of possession
over the property. The lessor transfers merely the temporary
use and enjoyment of the thing leased. Generally, ownership
is transferred upon delivery, however, the ownership may
still be with the seller until full payment of the price is made.
Only at the time when the payments are made in full
will the deed of absolute sale be given, entitling the buyer
(Daniel) as the true owner, rather than just having inchoate

rights to the property. The time when he was able to pay the
remaining balance, he was already married to his second
wife, Annette, which makes the said property as their
conjugal property.
ART 118 of FC: any amount advanced by the partnership or
by either or both spouses shall be reimbursed
Depriving the children from the first will be unfair due
to the fact that the lease was contracted during the first
marriage, wherein a portion of the payment came from.
Ching v. CA, 423 SCRA 356, February 23, 2004
FACTS: Philippine Blooming Mills Company, Inc. (PBMCI)
obtained two loans from the Allied Banking Corporation
(ABC). (PBMCI) Executive Vice-President Alfredo Ching
executed a continuing guaranty with the ABC for the
payment of the said loan. The PBMCI defaulted in the
payment of all its loans so ABC filed a complaint for sum of
money against the PBMCI. Trial court issued a writ of
preliminary attachment against Alfredo Ching requiring the
sheriff of to attach all the properties of said Alfredo Ching to
answer for the payment of the loans. Encarnacion T. Ching,
wife of Alfredo Ching, filed a Motion to Set Aside the levy on
attachment allegeing inter alia that the 100,000 shares of
stocks levied on by the sheriff were acquired by her and her
husband during their marriage out of conjugal funds.
Petitioner spouses aver that the source of funds in the
acquisition of the levied shares of stocks is not the controlling
factor when invoking the presumption of the conjugal nature
of stocks under Art. 121 and that such presumption subsists
even if the property is registered only in the name of one of
the spouses, in this case, petitioner Alfredo Ching. According
to the petitioners, the suretyship obligation was not
contracted in the pursuit of the petitioner-husbands
profession or business.44

19

ISSUE: WON 100,000 shares of stocks may be levied on by

the sheriff to answer for the loans guaranteed by petitioner
Alfredo Ching
HELD: No.
RATIO: The CA erred in holding that by executing a
continuing guaranty and suretyship agreement with the
private respondent for the payment of the PBMCI loans, the
petitioner-husband was in the exercise of his profession,
pursuing a legitimate business.
The shares of stocks are, thus, presumed to be the
conjugal partnership property of the petitioners. The private
respondent failed to adduce evidence that the petitionerhusband acquired the stocks with his exclusive money.
The appellate court erred in concluding that the
conjugal partnership is liable for the said account of PBMCI.
Article 121 provides: The conjugal partnership shall be liable
for: (1) All debts and obligations contracted by the husband
for the benefit of the conjugal partnership, and those
contracted by the wife, also for the same purpose, in the
cases where she may legally bind the partnership.
For the conjugal partnership to be liable for a liability
that should appertain to the husband alone, there must be a
showing that some advantages accrued to the spouses.
In this case, the private respondent failed to prove that
the conjugal partnership of the petitioners was benefited by
the petitioner-husbands act of executing a continuing
guaranty and suretyship agreement with the private
respondent for and in behalf of PBMCI. The contract of loan
was between the private respondent and the PBMCI, solely
for the benefit of the latter. No presumption can be inferred
from the fact that when the petitioner-husband entered into
an accommodation agreement or a contract of surety, the
conjugal partnership would thereby be benefited. The private

respondent was burdened to establish that such benefit

redounded to the conjugal partnership.
G.R. No. L-19346, Lacson et al. v. Diaz, 14 SCRA 183,
May 31, 1965
The facts of this case are not disputed:
In connection with a final decision rendered by the
Court of First Instance of Negros Occidental in Civil Case No.
5790 (Soledad L. Lacson, et al. v. Abelardo G. Diaz),
sentencing therein defendant to pay the plaintiffs the sum of
P97,532.93 with legal interest thereon from July 1, 1960 until
fully paid, plus a sum equivalent to 25% of the total amount
as attorney's fees, the court issued a writ of execution on
August 1, 1961. On August 7, 1961, the Provincial Sheriff of
Negros Occidental sent to the manager of Talisay-Silay Milling
Company, wherein defendant Diaz was employed, a notice to
garnish one-third of his monthly salary and of any other
personal properties belonging to said defendant, to cover the
total amount of P132,718.30.
Diaz filed with the court a motion to quash the writ of
execution and to lift the notice of garnishment (of his salary),
on the ground that the same are not enforceable against his
present family. It was claimed that since the money-judgment
arose out of a contract entered into by him during his first
marriage said judgment cannot be enforced against his
salaries which form part of the conjugal properties of the
second marriage. Plaintiffs opposed this motion, for the
reason that re-marriage is not a cause for extinction of
obligations. As his aforesaid motion after hearing was denied
by the court for lack of merit, the defendant instituted the
present appeal.
Appellant does not dispute the existence of the
money-judgment against him in the amount abovestated,
which decision was rendered in 1947 and affirmed by the
appellate court in 1950. It appears, however, that appellant,
20

who became a widower in 1951, remarried in 1960. The writ

of execution and notice of garnishment in this case were
issued and implemented in 1961. It is now contended that, as
the conjugal partnership resulting of the second marriage is
different from that of the first marriage, during which
existence the obligation arose, such obligation, as far as the
second conjugal partnership is concerned, is personal to the
husband and cannot be charged against the properties of the
second union. And, since his salaries form part of the
conjugal asset the same cannot be garnished to satisfy his
personal obligations. In support of this proposition, appellant
cites Article 163 of the new Civil Code and the ruling of this
Court that the right of the husband to one-half of the assets
of the conjugal partnership does not vest until the dissolution
of the marriage.[[1]]
Article 163 of the new Civil Code relied upon by the appellant
provides:
ART. 163. The payment of debts contracted by the husband
or the wife before the marriage shall not be charged to the
conjugal partnership.
Neither shall the fines and pecuniary indemnities imposed
upon them be charged to the partnership.
However, the payment of debts contracted by the
husband or the wife before the marriage, and that of fines
and indemnities imposed upon them, may be enforced
against the partnership assets after the responsibilities
enumerated in article 161 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 purpose above-mentioned.
As a general rule, therefore, debts contracted by the
husband or the wife before the marriage,[[2]] as well as fines
and pecuniary indemnities imposed thereon, are not

chargeable to the conjugal partnership. However, such

obligations may be enforced against the conjugal assets if
the responsibilities enumerated in Article 161[[3]] of the new
Civil Code have already been covered, and that the obligor
has no exclusive property or the same is insufficient.
Considering that the enforceability of the personal
obligations of the husband or wife, against the conjugal
assets, forms the exception to the general rule, it is
incumbent upon the one who invokes this provision or the
creditor to show that the requisites for its applicability are
obtaining.
In the instant case, although it is not controverted that
there is due and owing the plaintiffs-appellees a certain sum
of money from the appellant-debtor a personal obligation
yet, it has not been established that the latter does not have
properties of his own or that the same are not adequate to
satisfy appellees' claim. Furthermore, there is no showing
that the responsibilities named in Article 161 of the new Civil
Code have already been covered in order that the personal
obligation of the husband may be made chargeable against
the properties of the second marriage.
IN VIEW OF THE FOREGOING CONSIDERATIONS, this case is
hereby remanded to the court of origin for further
proceedings, in accordance with the aforestated observation.
No costs. So ordered.
People v. Lagrimas, G.R. No. L-25355, August 28, 1969
FACTS: Froilan Lagrimas was charged for the murder of
Pelagio Cagro. Thereafter, the heirs of Cagro filed a motion
for the issuance of a writ of preliminary attachment on the
property of the accused, which was granted. Lagrimas was
convicted and sentenced to suffer the penalty of reclusion
perpetua and to indemnify the appellants. The judgment
became final. The lower court issued a writ of execution to
cover the civil indemnity. A levy was had on 11 parcels of
land declared for tax purposes in the name of the accused
21

and the sale thereof at public auction was scheduled.

However, the wife of the accused, Mercedes Lagrimas, filed a
petition to quash the said attachment contending that the
property belonged to the conjugal partnership and could not
be held liable for pecuniary indemnity the husband was
required to pay. Her petition was granted. Another judge set
aside the said order. But upon Mercedes filing a motion for
reconsideration, a third judge revived the original order,
declaring such attachment and the writ of execution
thereafter issued null and void.
ISSUE: WON properties from the conjugal properties of
Mercedes and Froilan can be held liable for the pecuniary
indemnity incurred by the latter.
HELD: Yes. Fines and indemnities imposed upon either
husband or wife may be enforced against the partnership
assets after the responsibilities enumerated in article 161
have been covered, if the spouse who is bound should have
no exclusive property or if it should be insufficient; xxx.
It is quite plain, therefore, that the period during which
such a liability may be enforced presupposes that the
conjugal partnership is still existing for the law speaks of
partnership assets. That upon complying with the
responsibilities enumerated in article 161, the fines and
indemnities imposed upon a party of the conjugal partnership
will be satisfied.
If the appealed order were to be upheld, Froilan would
be in effect exempt therefrom and the heirs of the offended
party being made to suffer still further; that for a
transgression of the law by either husband or wife, the rest of
the family may be made to bear burdens of an extremely
onerous character.
Uy vs CA GR No 109557 November 29, 2000
FACTS: This case is a dispute between Teodoro L. Jardeleza
(herein respondent) on the one hand, against his mother

Gilda L. Jardeleza, and sister and brother-in-law, the spouses

Jose Uy and Glenda Jardeleza (herein petitioners) on the
other hand. The controversy came about as a result of Dr.
Ernesto Jardeleza, Sr.s suffering of a stroke which left him
comatose and bereft of any motor or mental faculties. Said
Ernesto Jardeleza, Sr. is the father of herein respondent
Teodoro Jardeleza and husband of herein private respondent
Gilda Jardeleza.
Respondent wife filed a petition for the declaration
of incapacity of his husband and assumption of sole powers
of administration of conjugal properties, and authorization to
sell one piece of real properties.
RTC granted said petition. Respondent opposed
and filed a Motion for Reconsideration contending that such
petition is essentially a petition for guardianship of the
person and properties of Jardeleza Sr and that a summary
proceedings was irregularly applied.
RTC denied the motion. CA reversed RTCs decision
for lack of due process on the part of the incapacitated
spouse; it did not require him to show cause why the petition
should not be granted.
ISSUE: WON petitioner Gilda L. Jardeleza as the wife of
Ernesto Jardeleza, Sr. who suffered a stroke, a
cerebrovascular accident, rendering him comatose, without
motor and mental faculties, and could not manage their
conjugal partnership property may assume sole powers of
administration of the conjugal property under Article 124 of
the Family Code and dispose of a parcel of land with its
improvements, worth more than twelve million pesos, with
the approval of the court in a summary proceedings, to her
co-petitioners, her own daughter and son-in-law, for the
amount of eight million pesos.
RULING: NO. ART. 124. The administration and enjoyment
of the conjugal partnership property shall belong to both
22

spouses jointly. In case of disagreement, the husbands

decision shall prevail, subject to recourse to the court by the
wife for a proper remedy which must be availed of within five
years from the date of the contract implementing such
decision.
In the event that one spouse is incapacitated or otherwise
unable to participate in the administration of the conjugal
properties, the other spouse may assume sole powers of
administration. These powers do not include the powers of
disposition or encumbrance which must have the authority of
the court or the written consent of the other spouse. In the
absence of such authority or consent, the disposition or
encumbrance shall be void. However, the transaction shall
be construed as a continuing offer on the part of the
consenting spouse and the third person, and may be
perfected as a binding contract upon the acceptance by the
other spouse or authorization by the court before the offer is
withdrawn by either or both offerors..

obtained. . Such rules do not apply to cases where the nonconsenting spouse is incapacitated or incompetent to give
consent. In this case, the trial court found that the subject
spouse "is an incompetent" who was in comatose or semicomatose condition, a victim of stroke, cerebrovascular
accident, without motor and mental faculties, and with a
diagnosis of brain stem infarct. In such case, the proper
remedy is a judicial guardianship proceedings under Rule 93
of the 1964 Revised Rules of Court.
Consequently, a spouse who desires to sell real
property as such administrator of the conjugal property must
observe the procedure for the sale of the wards estate
required of judicial guardians under Rule 95, 1964 Revised
Rules of Court, not the summary judicial proceedings under
the Family Code. Court affirmed in toto CAs decision.

Art 124 does not apply to cases where the nonconsenting spouse is incapacitated or incompetent to give
consent. The situation contemplated in Art 124 is that one
where the spouse is absent, or separated in fact or has
abandoned the other or consent is withheld or cannot be

23