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A.C. No.

3405 June 29, 1998


JULIETA B. NARAG, complainant,
vs.
ATTY. DOMINADOR M. NARAG, respondent.

PER CURIAM:
Good moral character is a continuing qualification required
of every member of the bar. Thus, when a lawyer fails to
meet the exacting standard of moral integrity, the Supreme
Court may withdraw his or her privilege to practice law.
On November 13, 1989, Mrs. Julieta B. Narag filed an
administrative complaint 1 for disbarment against her
husband, Atty. Dominador M. Narag, whom she accused of
having violated Canons 1 and 6, Rule 1.01 of the Code of
Ethics for Lawyers. 2
The complainant narrated:
The St. Louis College of Tuguegarao engaged the services
of Atty. Dominador M. Narag in the early seventies as a
full-time college instructor in the College of Arts and
Sciences and as a professor in the Graduate School. In
1984, Ms. Gina Espita, 17 years old and a first year college
student, enrolled in subjects handled by Atty. Narag.
Exerting his influence as her teacher, and as a prominent
member of the legal profession and then member of the
Sangguniang Bayan of Tuguegarao, Atty. Narag courted
Ms. Espita, gradually lessening her resistance until the
student acceded to his wishes.
They then maintained an illicit relationship known in
various circles in the community, but which they managed
to from me. It therefore came as a terrible
embar[r]assment to me, with unspeakable grief and pain
when my husband abandoned us, his family, to live with
Ms. Espita, in utterly scandalous circumstances.
It appears that Atty. Narag used his power and influence
as a member of the Sangguniang Panlalawigan of
Cagayan to cause the employment of Ms. Espita at the
Department of Trade and Industry Central Office at Makati,
Metro Manila. Out of gratitude perhaps, for this gesture,
Ms. Espita agreed to live with Atty. Narag, her sense of
right[e]ousness and morals completely corrupted by a
member of the Bar.
It is now a common knowledge in the community that Atty.
Dominador M. Narag has abandoned us, his family, to live
with a 22-year-old woman, who was his former student in
the tertiary level[.] 3
This Court, in a Resolution dated December 18, 1989,
referred the case to the Integrated Bar of the Philippines
(IBP) for investigation, report and recommendation. 4
On June 26, 1990, the office of then Chief Justice Marcelo B.
Fernan received from complainant another letter seeking the
dismissal of the administrative complaint. She alleged
therein that (1) she fabricated the allegations in her
complaint to humiliate and spite her husband; (2) all the
love letters between the respondent and Gina Espita were
forgeries; and (3) she was suffering from "emotional
confusion arising from extreme jealousy." The truth, she
stated, was that her husband had remained a faithful and
responsible family man. She further asserted that he had
neither entered into an amorous relationship with one Gina
Espita nor abandoned his family. 5 Supporting her letter were
an Affidavit of Desistance 6 and a Motion to
Dismiss, 7 attached as Annexes A and B, which she filed
before the IBP commission on bar discipline. 8 In a Decision
dared October 8, 1991, the IBP Board of
Governors 9 dismissed the complaint of Mrs. Narag for failure
to prosecute. 10

The case took an unexpected turn when, on November 25,


1991, this Court 11 received another letter 12 from the
complainant, with her seven
children 13 as co-signatories, again appealing for the
disbarment of her husband. She explained that she had
earlier dropped the case against him because of his
continuous threats against her. 14
In his Comment on the complainant's letter of November 11,
1991, filed in compliance with this Court's Resolution issued
on July 6, 1992, 15 respondent prayed that the decision of the
Board of Governors be affirmed. Denying that he had
threatened, harassed or intimidated his wife, he alleged that
she had voluntarily executed her Affidavit of
Desistance 16and Motion to Dismiss, 17 even appearing
before the investigating officer, Commissioner Racela, to
testify under oath "that she prepared the Motion to Dismiss
and Affidavit of Desistance on her own free will and affirmed
the contents thereof."
In addition, he professed his love for his wife and his children
and denied abandoning his family to live with his paramour.
However, he described his wife as a person emotionally
disturbed, viz:
What is pitiable here is the fact that Complainant is an
incurably jealous and possessive woman, and every time
the streak of jealousy rears its head, she fires off letters
or complaints against her husband in every conceivable
forum, all without basis, and purely on impulse, just to
satisfy the consuming demands of her "loving" jealousy.
Then, as is her nature, a few hours afterwards, when her
jealousy cools off, she repents and feels sorry for her acts
against the Respondent. Thus, when she wrote the Letter
of November 11, 1991, she was then in the grips of one
of her bouts of jealousy.18
On August 24, 1992, this Court issued another Resolution
referring the Comment of respondent to the IBP. 19 In the
hearing before IBP Commissioner Plaridel C. Jose,
respondent alleged the following: 20
2. Your Respondent comes from very poor parents who
have left him not even a square meter of land, but gave
him the best legacy in life: a purposeful and meaningful
education. Complainant comes from what she claims to be
very rich parents who value material possession more
than education and the higher and nobler aspirations in
life. Complainant abhors the poor.
3. Your Respondent has a loving upbringing, nurtured in
the gentle ways of love, forgiveness, humility, and concern
for the poor. Complainant was reared and raised in an
entirely different environment. Her value system is the
very opposite.
4. Your Respondent loves his family very dearly, and has
done all he could in thirty-eight (38) years of marriage to
protect and preserve his family. He gave his family
sustenance, a comfortable home, love, education,
companionship, and most of all, a good and respected
name. He was always gentle and compassionate to his
wife and children. Even in the most trying times, he
remained calm and never inflicted violence on them. His
children are all now full-fledged professionals, mature, and
gainfully employed. . . .
xxx xxx xxx
Your Respondent subscribes to the sanctity of marriage as
a social institution.
On the other hand, consumed by insane and unbearable
jealousy, Complainant has been systematically and
unceasingly destroying the very foundations of their
marriage and their family. Their marriage has become a
torture chamber in which Your Respondent has been
incessantly BEATEN, BATTERED, BRUTALIZED, TORTURED,
ABUSED, and HUMILIATED, physically, mentally, and

emotionally, by the Complainant, in public and at home.


Their marriage has become a nightmare.
For thirty-eight years, your Respondent suffered in silence
and bore the pain of his misfortune with dignity and with
almost infinite patience, if only to preserve their family
and their marriage. But this is not to be. The Complainant
never mellowed and never became gentl[e], loving, and
understanding. In fact, she became more fierce and
predatory.
Hence, at this point in time, the light at the tunnel for Your
Respondent does not seem in sight. The darkness
continues to shroud the marital and familial landscape.
Your Respondent has to undergo a catharsis, a liberation
from enslavement. Paraphrasing Dorfman in "Death and
the Maiden", can the torturer and the tortured co-exist and
live together?
Hence, faced with an absolutely uncomprehending and
uncompromising mind whose only obsession now is to
destroy, destroy, and destroy, Your Respondent, with
perpetual regret and with great sorrow, filed a Petition for
Annulment of Marriage, Spl. Proc. No. 566, RTC, Branch III,
Tuguegarao, Cagayan. . . .
5. Complainant is a violent husband-beater, vitriolic and
unbending. But your Respondent never revealed these
destructive qualities to other people. He preserved the
good name and dignity of his wife. This is in compliance
with the marital vow to love, honor or obey your spouse,
for better or for worse, in sickness and in health . . . Even
in this case, Your Respondent never revealed anything
derogatory to his wife. It is only now that he is constrained
to reveal all these things to defend himself.
On the other hand, for no reason at all, except a jealous
rage, Complainant tells everyone, everywhere, that her
husband is worthless, good-for-nothing, evil and immoral.
She goes to colleges and universities, professional
organizations, religious societies, and all other sectors of
the community to tell them how evil, bad and immoral her
husband is. She tells them not to hire him as professor, as
Counsel, or any other capacity because her husband is
evil, bad, and immoral. Is this love? Since when did love
become an instrument to destroy a man's dearest
possession in life his good name, reputation and
dignity?
Because of Complainant's virulent disinformation
campaign against her husband, employing every unethical
and immoral means to attain his ends, Your Respondent
has been irreparably and irreversibly disgraced, shamed,
and humiliated. Your Respondent is not a scandalous man.
It is he who has been mercilessly scandalized and
crucified by the Complainant. 21
To prove the alleged propensity of his wife to file false
charges, respondent presented as evidence the following list
of the complaints she had filed against him and Gina Espita:
3.1 Complaint for Immorality/Neglect of Duty . . .
3.2 Complaint for Immorality/Neglect of Duty, DILG,
Adm. Case No. P-5-90. . . .
3.3 Complaint for Concubinage. Provincial Prosecutor's
Office of Cagayan. I.S No. 89-114. . . .
3.4 Complaint for Anti-Graft and Corrupt Practices and
concubinage. OMBUDSMAN Case No. 1-92-0083. . . .
3.5 Complaint for Civil Support. RTC, Tuguegarao, Civil
Case No. 4061. DISMISSED.
3.6 Complaint for Concubinage. Provincial Prosecutor's
Office of Cagayan. I.S. No. 92-109. DISMISSED. (. . .).
Complainant filed Motion for Reconsideration. DENIED. (.
. .).

3.7 Complaint for Disbarment (. . .) with S[upreme]


C[ourt]. Withdrawn (. . .). DISMISSED by IBP Board of
Governors (. . .). Re-instituted (. . .).
3.8 Complaint for Disbarment, again (. . .). Adm. Case
No. 3405. Pending.
3.9 Complaint for Concubinage, again (. . .). Third MCTC,
Tumauini, Isabela. Pending. . . . 22
In his desperate effort to exculpate himself, he averred:
I. That all the alleged love letters and envelopes (. . .),
picture (. . .) are inadmissible in evidence as enunciated
by the Supreme Court in "Cecilia Zulueta vs. Court of
Appeals, et.al.", G.R. No. 107383, February 20, 1996. (. . .).
xxx xxx xxx
II. That respondent is totally innocent of the charges: He
never courted Gina Espita in the Saint Louis College of
Tuguegarao. He never caused the employment of said
woman in the DTI. He never had or is having any illicit
relationship with her anywhere, at any time. He never
lived with her as husband and wife anywhere at any time,
be it in Centro Tumauini or any of its barangays, or in any
other place. He never begot a child or children with her.
Finally, respondent submits that all the other allegations of
Mrs. Narag are false and fabricated, . . .
xxx xxx xxx
III. Respondent never abandoned his family[.] Mrs. Narag
and her two sons forcibly drove respondent Narag out of
the conjugal home. After that, Atty. Narag tried to return to
the conjugal home many times with the help of mutual
friends to save the marriage and the family from collapse.
He tried several times to reconcile with Mrs. Narag. In fact,
in one of the hearings of the disbarment case, he offered
to return home and to reconcile with Mrs. Narag. But Mrs.
Narag refused all these efforts of respondent Narag. . . .
IV. Complainant Julieta B. Narag is an unbearably jealous,
violent, vindictive, scandalous, virulent and merciless wife
since the beginning of the marriage, who incessantly beat,
battered, brutalized, tortured, abuse[d], scandalized, and
humiliated respondent Atty. Narag, physically, mentally,
emotionally, and psychologically, . . .
V. Complainant Julieta Narag's claim in her countermanifestation dated March 28, 1996, to the effect that the
affidavit of Dominador B. Narag, Jr., dated February 27,
1996 was obtained through force and intimidation, is not
true. Dominador, Jr., executed his affidavit freely,
voluntarily, and absolutely without force or intimidation,
as shown by the transcript of stenographic notes of the
testimonies of Respondent Atty. Narag and Tuguegarao
MTC Judge Dominador Garcia during the trial of Criminal
Case No. 12439, People vs. Dominador M. Narag, et. al.,
before the Tuguegarao MTC on May 3, 1996. . . .
xxx xxx xxx
VI. Respondent Atty. Narag is now an old man a senior
citizen of 63 years sickly, abandoned, disgraced,
weakened and debilitated by progressively degenerative
gout and arthritis, and hardly able to earn his own keep.
His very physical, medical, psychological, and economic
conditions render him unfit and unable to do the things
attributed to him by the complainant. Please see the
attached medical certificates, . . ., among many other
similar certificates touching on the same ailments.
Respondent is also suffering from hypertension. 23
On July 18, 1997, the investigating officer submitted his
report, 24 recommending the indefinite suspension of Atty.
Narag from the practice of law. The material portions of said
report read as follows:

Culled from the voluminous documentary and testimonial


evidence submitted by the contending parties, two (2)
issues are relevant for the disposition of the case, namely:
a) Whether there was indeed a commission of alleged
abandonment of respondent's own family and [whether he
was] living with his paramour, Gina Espita;
b) Whether the denial under oath that his illegitimate
children with Gina Espita (Aurelle Dominic and Kyle
Dominador) as appearing on paragraph 1(g) of
respondent's Comment vis-a-vis his handwritten love
letters, the due execution and contents of which, although
he objected to their admissibility for being allegedly
forgeries, were never denied by him on the witness stand
much less presented and offered proof to support
otherwise.
Except for the testimonies of respondent's witnesses
whose testimonies tend to depict the complaining wife,
Mrs. Narag, as an incurably jealous wife and possessive
woman suffering everytime with streaks of jealousy,
respondent did not present himself on the witness stand
to testify and be cross-examined on his sworn comment;
much less did he present his alleged paramour, Gina
Espita, to disprove the adulterous relationship between
him and their having begotten their illegitimate children,
namely: Aurelle Dominic N. Espita and Kyle Dominador N.
Espita. Worse, respondent's denial that he is the father of
the two is a ground for disciplinary sanction (Morcayda v.
Naz, 125 SCRA 467).
Viewed from all the evidence presented, we find the
respondent subject to disciplinary action as a member of
the legal profession. 25
In its Resolution 26 issued on August 23, 1997, the IBP
adopted and approved the investigating commissioner's
recommendation for the indefinite suspension of the
respondent. 27 Subsequently the complaint sought the
disbarment of her husband in a Manifestation/Comment she
filed on October 20, 1997. The IBP granted this stiffer
penalty and, in its Resolution dated November 30, 1997,
denied respondent's Motion for Reconsideration.
After a careful scrutiny of the records of the proceedings and
the evidence presented by the parties, we find that the
conduct of respondent warrants the imposition of the
penalty of disbarment.
The Code of Professional Responsibility provides:
Rule 1.01 A lawyer shall not engage in unlawful,
dishonest, immoral or deceitful conduct.
CANON 7 A lawyer shall at all times uphold the integrity
and dignity of the legal profession, and support the activities
of the Integrated Bar.
Rule 7.03 A lawyer shall not engage in conduct that
adversely reflects on his fitness to practice law, nor should
he, whether in public or private life, behave in a scandalous
manner to the discredit of the legal profession.Thus, good
moral character is not only a condition precedent 28 to the
practice of law, but a continuing qualification for all
members of the bar. Hence, when a lawyer is found guilty of
gross immoral conduct, he may be suspended or disbarred.29
Immoral conduct has been defined as that conduct which is
so willful, flagrant, or shameless as to show indifference to
the opinion of good and respectable members of the
community. 30 Furthermore, such conduct must not only be
immoral, but grossly immoral. That is, it must be so corrupt
as to constitute a criminal act or so unprincipled as to be
reprehensible to a high degree 31 or committed under such
scandalous or revolting circumstances as to shock the
common sense of decency. 32
We explained in Barrientos vs. Daarol 33 that, "as officers of
the court, lawyers must not only in fact be of good moral
character but must also be seen to be of good moral

character and leading lives in accordance with the highest


moral standards of the community. More specifically, a
member of the Bar and officer of the court is not only
required to refrain from adulterous relationships or the
keeping of mistresses but must also so behave himself as to
avoid scandalizing the public by creating the belief that he is
flouting those moral standards."
Respondent Narag is accused of gross immorality for
abandoning his family in order to live with Gina Espita. The
burden of proof rests upon the complainant, and the Court
will exercise its disciplinary power only if she establishes her
case by clear, convincing and satisfactory evidence. 34
Presented by complainant as witnesses, aside from
herself. 35 were: Charlie Espita, 36 Magdalena
Bautista, 37Bienvenido Eugenio, 38 Alice Carag, 39 Dr. Jervis B.
Narag, 40 Dominador Narag, Jr., 41 and Nieves F. Reyes. 42
Charlie Espita, brother of the alleged paramour Gina Espita,
corroborated complainant's charge against respondent in
these categorical statements he gave to the investigating
officer:
Q Mr. Witness, do you know Atty. Narag?
A Yes, Your Honor, he is the live-in partner of my sister,
Gina Espita.
Q If Atty. Narag is here, can you point [to] him?
A Yes, sir.
(Witness pointed to the respondent, Atty. Dominador
Narag)
Q Why do you know Atty. Narag?
ATTY. NARAG:
Already answered. He said I am the live-in partner.
CONTINUATION OF THE DIRECT
A Because he is the live-in partner of my sister and that
they are now living together as husband and wife and that
they already have two children, Aurelle Dominic and Kyle
Dominador.
xxx xxx xxx
During cross-examination conducted by the respondent
himself, Charlie Espita repeated his account that his sister
Gina was living with the respondent, with whom she had two
children:
Q Mr. Espita, you claim that Atty. Narag is now living with
your sister as husband and wife. You claim that?
A Yes, sir.
Q Why do you say that?
A Because at present you are living together as husband
and wife and you have already two children and I know
that is really an immoral act which you cannot just allow
me to follow since my moral values don't allow me that
my sister is living with a married man like you.
Q How do you know that Atty. Narag is living with your
sister? Did you see them in the house?
A Yes, si[r].
xxx xxx xxx

Q You said also that Atty. Narag and your sister have two
children, Aurelle Dominic and Kyle Dominador, is it not?

did not present any evidence to prove that the love letters
were not really written by him; he merely denied that he
wrote them.

A Yes, sir.
Q How do you know that they are the children of Atty.
Narag?
A Because you are staying together in that house and you
have left your family. 44
In addition, Charlie Espita admitted (1) that it was he who
handed to Mrs. Narag the love letters respondent had sent
to his sister, and (2) that Atty. Narag tried to dissuade him
from appearing at the disbarment proceedings. 45
Witness Bienvenido Eugenio strengthened the testimony of
Charlie Espita in this wise:
Q Mr. Witness, do you know the respondent in this case?
A I know him very well, sir.
Q Could you please tell us why do you know him?
A Because he was always going to the house of my son-inlaw by the name of Charlie Espita.
xxx xxx xxx
Q Mr. Eugenio, do you know the residence of Atty.
Dominador M. Narag?
A At that time, he [was] residing in the house of Reynaldo
Angubong, sir.
Q And this is located where?
A Centro Tamauini, Isabela, sir.
Q And you specifically, categorically state under oath that
this is the residence of Atty. Narag?
A Yes, sir.
xxx xxx xxx
Q And under oath this is where Atty. Narag and Gina
Espita are allegedly living as husband and wife, is it not?
A Yes, sir.

46

Witness Nieves Reyes, a neighbor and friend of the


estranged couple, testified that she learned from the Narag
children Randy, Bong and Rowena that their father left
his family, that she and her husband prodded the
complainant to accept the respondent back, that the Narag
couple again separated when the respondent "went back to
his woman," and that Atty. Narag had maltreated his wife. 47
On the strength of the testimony of her witnesses, the
complainant was able to establish that respondent
abandoned his family and lived with another woman. Absent
any evidence showing that these witnesses had an ill motive
to testify falsely against the respondent, their testimonies
are deemed worthy of belief.
Further, the complainant presented as evidence the love
letters that respondent had sent to Gina. In these letters,
respondent clearly manifested his love for Gina and her two
children, whom he acknowledged as his own. In addition,
complainant, also submitted as evidence the cards that she
herself had received from him. Guided by the rule that
handwriting may be proved through a comparison of one set
of writings with those admitted or treated by the respondent
as genuine, we affirm that the two sets of evidence were
written by one and the same person. 48 Besides, respondent

While the burden of proof is upon the complainant,


respondent has the duty not only to himself but also to the
court to show that he is morally fit to remain a member of
the bar. Mere denial does not suffice. Thus, when his moral
character is assailed, such that his right to continue
practicing his cherished profession is imperiled, he must
meet the charges squarely and present evidence, to the
satisfaction of the investigating body and this Court, that he
is morally fit to have his name in the Roll of
Attorneys. 49 This he failed to do.
Respondent adamantly denies abandoning his family to live
with Gina Espita. At the same time, he depicts his wife as a
"violent husband-beater, vitriolic and unbending," and as an
"insanely and pathologically jealous woman," whose only
obsession was to "destroy, destroy and destroy" him as
shown by her filing of a series of allegedly unfounded
charges against him (and Gina Espita). To prove his
allegation, he presented ninety-eight (98) pieces of
documentary evidence 50 and ten (10) witnesses. 51
We note, however, that the testimonies of the witnesses of
respondent did not establish the fact that he maintained that
moral integrity required by the profession that would render
him fit to continue practicing law. Neither did their
testimonies destroy the fact, as proven by the complainant,
that he had abandoned his family and lived with Gina Espita,
with whom he had two children. Some of them testified on
matters which they had no actual knowledge of, but merely
relied on information from either respondent himself or other
people, while others were presented to impeach the good
character of his wife.
Respondent may have provided well for his family they
enjoyed a comfortable life and his children finished their
education. He may have also established himself as a
successful lawyer and a seasoned politician. But these
accomplishments are not sufficient to show his moral fitness
to continue being a member of the noble profession of law.
We remind respondent that parents have not only rights but
also duties e.g., to support, educate and instruct their
children according to right precepts and good example; and
to give them love, companionship and understanding, as
well as moral and spiritual guidance. 52 As a husband, he is
also obliged to live with his wife; to observe mutual love,
respect and fidelity; and to render help and support. 53
Respondent himself admitted that his work required him to
be often away from home. But the evidence shows that he
was away not only because of his work; instead, he
abandoned his family to live with her paramour, who bore
him two children. It would appear, then, that he was hardly
in a position to be a good husband or a good father. His
children, who grew up mostly under the care of their mother,
must have scarcely felt the warmth of their father's love.
Respondent's son, Jervis B. Narag, showed his resentment
towards his father's moral frailties in his testimony:
Q My question is this, is there any sin so grievous that it
cannot be forgiven, is there a fault that is so serious that it
is incapable of forgiveness?
A That depends upon the sin or fault, sir, but if the sin or
fault is with the emotional part of myself, I suppose I
cannot forgive a person although am a God-fearing
person, but I h[av]e to give the person a lesson in order
for him or her to at least realize his mistakes, sir.
xxx xxx xxx
COMR. JOSE:

I think it sounds like this. Assuming for the sake of


argument that your father is the worst, hardened criminal
on earth, would you send him to jail and have him
disbarred? That is the question.
CONTINUATION.
A With the reputation that he had removed from us, I
suppose he has to be given a lesson. At this point in time,
I might just forgive him if he will have to experience all the
pains that we have also suffered for quite sometime.
Q Dr. Narag, your father gave you life, his blood runs in
your veins, his flesh is your flesh, his bones are your
bones and you now disown him because he is the worst
man on earth, is that what you are saying.
A Sort of, sir.
Q You are now telling that as far [as] you are concerned
because your father has sinned, you have no more father,
am I correct?
A Long before, sir, I did not feel much from my father even
when I was still a kid because my father is not always
staying with us at home. So, how can you say that? Yes,
he gave me life, why not? But for sure, sir, you did not
give me love. 54
Another son, Dominador Narag, Jr., narrated before the
investigating officer the trauma he went through:
Q In connection with that affidavit, Mr. Witness, which
contains the fact that your father is maintaining a
paramour, could you please tell this Honorable
Commission the effect on you?

relationship with Gina Espita, whom he bore two children


by the name of Aurelle Dominic and Kyle Dominador,
which I could prove and I stand firm to this, Your Honor. 55
Although respondent piously claims adherence to the
sanctity of marriage, his acts prove otherwise. A husband is
not merely a man who has contracted marriage. Rather, he
is a partner who has solemnly sworn to love and respect his
wife and remain faithful to her until death.
We reiterate our ruling in Cordova vs. Cordova 56: "The moral
delinquency that affects the fitness of a member of the bar
to continue as such includes conduct that outrages the
generally accepted moral standards of the community,
conduct for instance, which makes a mockery of the
inviolable social institution of marriage."
In Toledo vs. Toledo, 57 the respondent was disbarred from
the practice of law, when he abandoned his lawful wife and
cohabited with another woman who had borne him a child.
Likewise, in Obusan vs. Obusan, 58 the respondent was
disbarred after the complainant proved that he had
abandoned her and maintained an adulterous relationship
with a married woman. This Court declared that respondent
failed to maintain the highest degree of morality expected
and required of a member of the bar.
In the present case, the complainant was able to establish,
by clear and convincing evidence, that respondent had
breached the high and exacting moral standards set for
members of the law profession. As held in Maligsa vs.
Cabanting, 59 "a lawyer may be disbarred for any
misconduct, whether in his professional or private capacity,
which shows him to be wanting in moral character, in
honesty, probity and good demeanor or unworthy to
continue as an officer of the court."

A This has a very strong effect on me and this includes


my brothers and sisters, especially my married life, sir.
And it also affected my children so much, that I and my
wife ha[ve] parted ways. It hurts to say that I and my
wife parted ways. This is one reason that affected us.

WHEREFORE, Dominador M. Narag is hereby DISBARRED and


his name is ORDERED STRICKEN from the Roll of Attorneys.
Let copies of this Decision be in the personal record of
Respondent Narag; and furnished to all courts of the land,
the Integrated Bar of the Philippines, and the Office of the
Bar Confidant.

Q Will you please tell us specifically why you and your


wife parted ways?

SO ORDERED.

A Because my wife wa[s] ashamed of what happened to


my family and that she could not face the people, our
community, especially because my wife belongs to a
well-known family in our community.
Q How about the effect on your brothers and sisters?
Please tell us what are those.
A Well, sir, this has also affected the health of my elder
sister because she knows so well that my mother
suffered so much and she kept on thinking about my
mother.
xxx xxx xxx
Q Why did your wife leave you?
A The truth is because of the things that had happened in
our family, Your Honor.
Q In your wife's family?
A In our family, sir.
Q And what do you mean by that?
A What meant by that is my father had an illicit
relationship and that my father went to the extent of
scolding my wife and calling my wife a "puta" in
provincial government, which my mother-in-law hated
him so much for this, which really affected us. And then
my wife knew for a fact that my father has an illicit

G.R. No. 11263

November 2, 1916

ELOISA GOITIA DE LA CAMARA, plaintiff-appellant,


vs.
JOSE CAMPOS RUEDA, defendant-appellee.
Eduardo Gutierrez Repide and Felix Socias for appellant.
Sanz, Opisso and Luzuriaga for appellee.

TRENT, J.:
This is an action by the wife against her husband for support
outside of the conjugal domicile. From a judgment sustaining
the defendant's demurrer upon the ground that the facts
alleged in the complaint do not state a cause of action,
followed by an order dismissing the case after the plaintiff
declined to amend, the latter appealed.
It was urged in the first instance, and the court so held, that
the defendant cannot be compelled to support the plaintiff,
except in his own house, unless it be by virtue of a judicial
decree granting her a divorce or separation from the
defendant.
The parties were legally married in the city of Manila on
January 7, 1915, and immediately thereafter established
their residence at 115 Calle San Marcelino, where they lived
together for about a month, when the plaintiff returned to

the home of her parents. The pertinent allegations of the


complaint are as follows:
That the defendant, one month after he had contracted
marriage with the plaintiff, demanded of her that she
perform unchaste and lascivious acts on his genital
organs; that the plaintiff spurned the obscene demands of
the defendant and refused to perform any act other than
legal and valid cohabitation; that the defendant, since that
date had continually on other successive dates, made
similar lewd and indecorous demands on his wife, the
plaintiff, who always spurned them, which just refusals of
the plaintiff exasperated the defendant and induce him to
maltreat her by word and deed and inflict injuries upon
her lips, her face and different parts of her body; and that,
as the plaintiff was unable by any means to induce the
defendant to desist from his repugnant desires and cease
from maltreating her, she was obliged to leave the
conjugal abode and take refuge in the home of her
parents.
Marriage in this jurisdiction is a contract entered into in the
manner and with the solemnities established by General
Orders No. 68, in so far as its civil effects are concerned
requiring the consent of the parties. (Garcia vs. Montague,
12 Phil. Rep., 480, citing article 1261 of Civil Code.) Upon the
termination of the marriage ceremony, a conjugal
partnership is formed between the parties. (Sy Joc Lieng vs.
Encarnacion, 16 Phil. Rep., 137.) To this extent a marriage
partakes of the nature of an ordinary contract. But it is
something more than a mere contract. It is a new relation,
the rights, duties, and obligations of which rest not upon the
agreement of the parties but upon the general law which
defines and prescribes those rights, duties, and
obligations .Marriage is an institution, in the maintenance of
which in its purity the public is deeply interested. It is a
relation for life and the parties cannot terminate it at any
shorter period by virtue of any contract they may make .The
reciprocal rights arising from this relation, so long as it
continues, are such as the law determines from time to time,
and none other. When the legal existence of the parties is
merged into one by marriage, the new relation is regulated
and controlled by the state or government upon principles of
public policy for the benefit of society as well as the parties.
And when the object of a marriage is defeated by rendering
its continuance intolerable to one of the parties and
productive of no possible good to the community, relief in
some way should be obtainable. With these principles to
guide us, we will inquire into the status of the law touching
and governing the question under consideration.
Articles 42 to 107 of the Civil Code are not in force in the
Philippine Islands (Benedicto vs. De la Rama, 3 Phil .Rep.,
34). Articles 44 to 78 of the Law of Civil Marriage of 1870, in
force in the Peninsula, were extended to the Philippine
Islands by royal decree on April 13, 1883 (Ebreo vs. Sichon,
4 Phil. Rep., 705). Articles 44, 45, and 48 of this law read:
ART. 44. The spouses are obliged to be faithful to each
other and to mutually assist each other.
ART. 45. The husband must live with and protect his wife.
(The second paragraph deals with the management of the
wife's property.)
ART. 48. The wife must obey her husband, live with him,
and follow him when he charges his domicile or residence.
Notwithstanding the provisions of the foregoing
paragraph, the court may for just cause relieve her from
this duty when the husband removes his residence to a
foreign country.
And articles 143 and 149 of the Civil Code are as follows:
ART. 143. The following are obliged to support each other
reciprocally to the whole extent specified in the preceding
article.
1. The consorts.

xxx

xxx

xxx

ART. (149) 49. The person obliged to give support may, at


his option, satisfy it, either by paying the pension that
may be fixed or by receiving and maintaining in his own
home the person having the right to the same.
Article 152 of the Civil Code gives the instances when the
obligation to give support shall cease. The failure of the wife
to live with her husband is not one of them.
The above quoted provisions of the Law of Civil Marriage and
the Civil Code fix the duties and obligations of the spouses.
The spouses must be faithful to, assist, and support each
other. The husband must live with and protect his wife. The
wife must obey and live with her husband and follow him
when he changes his domicile or residence, except when he
removes to a foreign country. But the husband who is
obliged to support his wife may, at his option, do so by
paying her a fixed pension or by receiving and maintaining
her in his own home. May the husband, on account of his
conduct toward his wife, lose this option and be compelled
to pay the pension? Is the rule established by article 149 of
the Civil Code absolute? The supreme court of Spain in its
decision of December 5, 1903, held:.
That in accordance with the ruling of the supreme court of
Spain in its decisions dated May 11, 1897, November 25,
1899, and July 5, 1901, the option which article 149 grants
the person, obliged to furnish subsistence, between
paying the pension fixed or receiving and keeping in his
own house the party who is entitled to the same, is not so
absolute as to prevent cases being considered wherein,
either because this right would be opposed to the exercise
of a preferential right or because of the existence of some
justifiable cause morally opposed to the removal of the
party enjoying the maintenance, the right of selection
must be understood as being thereby restricted.
Whereas the only question discussed in the case which
gave rise to this appeal was whether there was any reason
to prevent the exercise of the option granted by article
149 of the Civil Code to the person obliged to furnish
subsistence, to receive and maintain in his own house the
one who is entitled to receive it; and inasmuch as nothing
has been alleged or discussed with regard to the parental
authority of Pedro Alcantara Calvo, which he ha not
exercised, and it having been set forth that the natural
father simply claims his child for the purpose of thus
better attending to her maintenance, no action having
been taken by him toward providing the support until,
owing to such negligence, the mother was obliged to
demand it; it is seen that these circumstances, together
with the fact of the marriage of Pedro Alcantara, and that
it would be difficult for the mother to maintain relations
with her daughter, all constitute an impediment of such a
nature as to prevent the exercise of the option in the
present case, without prejudice to such decision as may
be deemed proper with regard to the other questions
previously cited in respect to which no opinion should be
expressed at this time.
The above was quoted with approval in United States and De
Jesus vs. Alvir (9 Phil. Rep., 576), wherein the court held that
the rule laid down in article 149 of the Civil Code "is not
absolute." but it is insisted that there existed a preexisting
or preferential right in each of these cases which was
opposed to the removal of the one entitled to support. It is
true that in the first the person claiming the option was the
natural father of the child and had married a woman other
than the child's mother, and in the second the right to
support had already been established by a final judgment in
a criminal case. Notwithstanding these facts the two cases
clearly established the proposition that the option given by
article 149 of the Civil Code may not be exercised in any and
all cases.
Counsel for the defendant cite, in support of their
contention, the decision of the supreme court of Spain,
dated November 3, 1905. In this case Don Berno Comas, as
a result of certain business reverses and in order no to
prejudice his wife, conferred upon her powers to administer
and dispose of her property. When she left him he gave her

all the muniments of title, mortgage credits, notes, P10,000


in accounts receivable, and the key to the safe in which he
kept a large amount of jewels, thus depriving himself of all
his possessions and being reduced in consequence to want.
Subsequently he instituted this civil action against his wife,
who was then living in opulence, for support and the
revocation of the powers heretofore granted in reference to
the administration and disposal of her property. In her
answer the wife claimed that the plaintiff (her husband) was
not legally in a situation to claim support and that the
powers voluntarily conferred and accepted by her were
bilateral and could not be canceled by the plaintiff. From a
judgment in favor of the plaintiff the defendant wife
appealed to the Audencia Territorialwherein, after due trial,
judgment was rendered in her favor dismissing the action
upon the merits. The plaintiff appealed to the supreme court
and that high tribunal, in affirming the judgment of
the Audencia Territorial, said:
Considering that article 143, No. 1, of the Civil Code,
providing that the spouses are mutually obliged to
provide each other with support, cannot but be
subordinate to the other provisions of said Code which
regulates the family organization and the duties of
spouses not legally separated, among which duties are
those of their living together and mutually helping each
other, as provided in article 56 of the aforementioned
code; and taking this for granted, the obligation of the
spouse who has property to furnish support to the one
who has no property and is in need of it for subsistence,
is to be understood as limited to the case where, in
accordance with law, their separation has been decreed,
either temporarily or finally and this case, with respect to
the husband, cannot occur until a judgment of divorce is
rendered, since, until then, if he is culpable, he is not
deprived of the management of his wife's property and of
the product of the other property belonging to the
conjugal partnership; and
Considering that, should the doctrine maintained in the
appeal prevail, it would allow married persons to
disregard the marriage bond and separate from each
other of their own free will, thus establishing, contrary to
the legal provision contained in said article 56 of the Civil
Code, a legal status entirely incompatible with the nature
and effects of marriage in disregard of the duties
inherent therein and disturbing the unity of the family, in
opposition to what the law, in conformity with good
morals, has established; and.
Considering that, as the spouses D. Ramon Benso and
Doa Adela Galindo are not legally separated, it is their
duty to live together and afford each other help and
support; and for this reason, it cannot be held that the
former has need of support from his wife so that he may
live apart from her without the conjugal abode where it is
his place to be, nor of her conferring power upon him to
dispose even of the fruits of her property in order
therewith to pay the matrimonial expenses and,
consequently, those of his own support without need of
going to his wife; wherefore the judgment appealed from,
denying the petition of D. Ramon Benso for support, has
not violated the articles of the Civil Code and the
doctrine invoked in the assignments of error 1 and 5 of
the appeal.
From a careful reading of the case just cited and quoted
from it appears quite clearly that the spouses separated
voluntarily in accordance with an agreement previously
made. At least there are strong indications to this effect, for
the court says, "should the doctrine maintained in the
appeal prevail, it would allow married persons to disregard
the marriage bond and separate from each other of their
own free will." If this be the true basis upon which the
supreme court of Spain rested its decision, then the doctrine
therein enunciated would not be controlling in cases where
one of the spouses was compelled to leave the conjugal
abode by the other or where the husband voluntarily
abandons such abode and the wife seeks to force him to
furnish support. That this is true appears from the decision
of the same high tribunal, dated October 16, 1903. In this
case the wife brought an action for support against her
husband who had willfully and voluntarily abandoned the
conjugal abode without any cause whatever. The supreme

court, reversing the judgment absolving the defendant upon


the ground that no action for divorce, etc., had been
instituted, said:
In the case at bar, it has been proven that it was Don
Teodoro Exposito who left the conjugal abode, although
he claims, without however proving his contention, that
the person responsible for this situation was his wife, as
she turned him out of the house. From this state of affairs
it results that it is the wife who is party abandoned, the
husband not having prosecuted any action to keep her in
his company and he therefore finds himself, as long as he
consents to the situation, under the ineluctable
obligation to support his wife in fulfillment of the natural
duty sanctioned in article 56 of the Code in relation with
paragraph 1 of article 143. In not so holding, the trial
court, on the mistaken ground that for the fulfillment of
this duty the situation or relation of the spouses should
be regulated in the manner it indicates, has made the
errors of law assigned in the first three grounds alleged,
because the nature of the duty of affording mutual
support is compatible and enforcible in all situations, so
long as the needy spouse does not create any illicit
situation of the court above described.lawphil.net
If we are in error as to the doctrine enunciated by the
supreme court of Spain in its decision of November 3, 1905,
and if the court did hold, as contended by counsel for the
defendant in the case under consideration, that neither
spouse can be compelled to support the other outside of the
conjugal abode, unless it be by virtue of a final judgment
granting the injured one a divorce or separation from the
other, still such doctrine or holding would not necessarily
control in this jurisdiction for the reason that the substantive
law is not in every particular the same here as it is in Spain.
As we have already stated, articles 42 to 107 of the Civil
Code in force in the Peninsula are not in force in the
Philippine Islands. The law governing the duties and
obligations of husband and wife in this country are articles
44 to 78 of the Law of Civil Marriage of 1870 .In Spain the
complaining spouse has, under article 105 of the Civil Code,
various causes for divorce, such as adultery on the part of
the wife in every case and on the part of the husband when
public scandal or disgrace of the wife results therefrom;
personal violence actually inflicted or grave insults: violence
exercised by the husband toward the wife in order to force
her to change her religion; the proposal of the husband to
prostitute his wife; the attempts of the husband or wife to
corrupt their sons or to prostitute their daughters; the
connivance in their corruption or prostitution; and the
condemnation of a spouse to perpetual chains or hard labor,
while in this jurisdiction the only ground for a divorce is
adultery. (Benedicto vs. De la Rama, 3 Phil .Rep., 34, 45.)
This positive and absolute doctrine was announced by this
court in the case just cited after an exhaustive examination
of the entire subject. Although the case was appealed to the
Supreme Court of the United States and the judgment
rendered by this court was there reversed, the reversal did
not affect in any way or weaken the doctrine in reference to
adultery being the only ground for a divorce. And since the
decision was promulgated by this court in that case in
December, 1903, no change or modification of the rule has
been announced. It is, therefore, the well settled and
accepted doctrine in this jurisdiction.
But it is argued that to grant support in an independent suit
is equivalent to granting divorce or separation, as it
necessitates a determination of the question whether the
wife has a good and sufficient cause for living separate from
her husband; and, consequently, if a court lacks power to
decree a divorce, as in the instant case, power to grant a
separate maintenance must also be lacking. The weakness
of this argument lies in the assumption that the power to
grant support in a separate action is dependent upon a
power to grant a divorce. That the one is not dependent
upon the other is apparent from the very nature of the
marital obligations of the spouses. The mere act of marriage
creates an obligation on the part of the husband to support
his wife. This obligation is founded not so much on the
express or implied terms of the contract of marriage as on
the natural and legal duty of the husband; an obligation, the
enforcement of which is of such vital concern to the state
itself that the laws will not permit him to terminate it by his
own wrongful acts in driving his wife to seek protection in

the parental home. A judgment for separate maintenance is


not due and payable either as damages or as a penalty; nor
is it a debt in the strict legal sense of the term, but rather a
judgment calling for the performance of a duty made
specific by the mandate of the sovereign. This is done from
necessity and with a view to preserve the public peace and
the purity of the wife; as where the husband makes so base
demands upon his wife and indulges in the habit of
assaulting her. The pro tanto separation resulting from a
decree for separate support is not an impeachment of that
public policy by which marriage is regarded as so sacred and
inviolable in its nature; it is merely a stronger policy
overruling a weaker one; and except in so far only as such
separation is tolerated as a means of preserving the public
peace and morals may be considered, it does not in any
respect whatever impair the marriage contract or for any
purpose place the wife in the situation of a feme sole.
The foregoing are the grounds upon which our short opinion
and order for judgment, heretofore filed in this case, rest.

G.R. No. L-19671

July 26, 1966

PASTOR B. TENCHAVEZ, plaintiff and appellant,


vs.
VICENTA F. ESCAO, ET AL., defendants and appellees.
Isabelo V. Binamira, Filemon B. Barria and Crispin D. Baizas
and Associates for appellants.
Vicente L. Faelnar for appellee Mamerto Escao and Mena F.
Escao.
Jalandoni and Jamir for appellee Vicenta F. Escao
Norberto J. Quisumbing for intervenor Russel Leo Moran.
RESOLUTION
REYES, J.B.L., J.:
Not satisfied with the decision of this Court, promulgated on
29 November 1965, in the above-entitled case, plaintiffappellant Pastor B. Tenchavez and defendant-appellee
Vicenta F. Escao, respectively, move for its reconsideration;
in addition, Russell Leo Moran, whom said defendant married
in the United States, has filed, upon leave previously
granted, a memorandum in intervention.
Movant Tenchavez poses the novel theory that Mamerto and
Mina Escao are undeserving of an award for damages
because they are guilty of contributory negligence in failing
to take up proper and timely measures to dissuade their
daughter Vicenta from leaving her husband Tenchavez
obtaining a foreign divorce and marrying another man
(Moran). This theory cannot be considered: first, because
this was not raised in the court below; second, there is no
evidence to support it; third, it contradicts plaintiff's previous
theory of alienation of affections in that contributory
negligence involves an omission to perform an act while
alienation of affection involves the performance of a positive
act.
The prayer of appellant Tenchavez in his motion for
reconsideration to increase the damages against Vicenta
(P25,000 for damages and attorney's fees were awarded to
Tenchavez in the decision) should, likewise, be denied, all
factors and circumstances in the case having been duly
considered in the main decision.
In seeking a reexamination of the decision, defendantappellee Vicenta Escao, in turn, urges a comparison
between the two marriages, stating, in plainer terms, that
the Tenchavez-Escano marriage was no more than a
ceremony, and a faulty one at that, while the Moran-Escao
marriage fits the concept of a marriage as a social institution
because publicly contracted, recognized by both civil and
ecclesiastical authorities, and blessed by three children. She
concludes that, since the second marriage is the better one,
it deserves the laws recognition and protection over the
other. This is a dangerous proposition: it legalizes a
continuing polygamy by permitting a spouse to just drop at
pleasure her consort for another in as many jurisdictions as
would grant divorce on the excuse that the new marriage is
better than the previous one; and, instead of fitting the
concept of marriage as a social institution, the proposition
altogether does away with the social aspects of marriage in
favor of its being a matter of private contract and personal
adventure.
The said appellee claims that state recognition should be
accorded the Church's disavowal of her marriage with
Tenchavez. On this point, our main decision limited itself to
the statement, "On 10 September 1954, Vicenta sought
papal dispensation of her marriage (Exh. P-2)", without
stating that papal dispensation was actually granted, the
reason being that Vicenta's claim that dispensation was
granted was not indubitable, and her counsel, during the
trial in the lower court, did not make good his promise to
submit the document evidencing the papal dispensation; in
fact, no such document appears on record. The Church's
disavowal of the marriage, not being sufficiently established,
it cannot be considered. Vicenta's belated appeal to Canon
law, after she had sought and failed to obtain annulment in
the civil courts, and after she had flaunted its principles by

obtaining absolute divorce, does not, and can not, sound


convincing. Particularly when account is taken of the
circumstances that she obtained the Nevada divorce in 1950
and only sought ecclesiastical release from her marriage to
Tenchavez in 1954.
The award of moral damages against Vicenta Escao is
assailed on the ground that her refusal to perform her wifely
duties, her denial of consortium and desertion of her
husband are not included in the enumeration of cases where
moral damages may lie. The argument is untenable. The
acts of Vicenta (up to and including her divorce, for grounds
not countenanced by our law, which was hers at the time)
constitute a wilful infliction of injury upon plaintiff's feelings
in a manner "contrary to morals, good customs or public
policy" (Civ. Code, Art. 21) for which Article 2219 (10)
authorizes an award of moral damages. Neither the case
of Ventanilla vs. Centeno, L-14333, 28 January 1961 (which
was a suit filed by a client against his lawyer for failure to
perfect an appeal on time), nor the case of Malonzo vs.
Galang, L-13851, 27 July 1960 (wherein the precise ruling
was that moral damages may not be recovered for a clearly
unfounded civil action or proceeding), now invoked by the
said defendant-appellee, is in point.
It is also argued that, by the award of moral damages, an
additional effect of legal separation has been added to
Article 106. Appellee obviously mistakes our grant of
damages as an effect of legal separation. It was plain in the
decision that the damages attached to her wrongful acts
under the codal article (Article 2176) expressly cited.
Appellee-movant commits a similar mistake by citing Arroyo
vs. Arroyo, 42 Phil. 54, and Ramirez-Cuaderno vs. Cuaderno,
L-20043, 28 November 1964, to support her argument that
moral damages did not attach to her failure to
render consortium because the sanction therefor is
spontaneous mutual affection, and not any legal mandate or
court order. The Arroyo case did rule that "it is not within the
province of courts of this country to attempt to compel one
of the spouses to cohabit with, and render conjugal rights to,
the other", but it referred to physically coercive means, the
Court declaring that
We are disinclined to sanction the doctrine that an
order, enforcible by process of contempt, may be
entered to compel prostitution of the purely
personal right of consortism. (Cas cit., p. 60)
(Emphasis supplied)
But economic sanctions are not held in our law to be
incompatible with the respect accorded to individual liberty
in civil cases. Thus, a consort who unjustifiably deserts the
conjugal abode can be denied support (Art. 178, Civil Code
of the Phil.). And where the wealth of the deserting spouse
renders this remedy illusory, there is no cogent reason why
the court may not award damage as it may in cases of
breach of other obligations to do intuitu personae even if in
private relations physical coercion be barred under the old
maxim "Nemo potest precise cogi and factum".
For analogous reasons, the arguments advanced against the
award of attorney's fees must be rejected as devoid of merit.
Contrary to intervenor Moran's contention, the decision did
not impair appellee's constitutional liberty of abode and
freedom of locomotion, as, in fact, Vicenta Escao did
exercise these rights, and even abused them by stating in
her application for a passport that she was "single", the
better to facilitate her flight from the wrongs she had
committed against her husband. The right of a citizen to
transfer to a foreign country and seek divorce in a diverse
forum is one thing, and the recognition to be accorded to the
divorce decree thus obtained is quite another; and the two
should not be confused.
Intervenor reiterates that recognition of Vicenta's divorce in
Nevada is a more enlightened view. The argument should be
addressed in the legislature. As the case presently stands,
the public policy of this forum is clearly adverse to such
recognition, as was extensively discussed in the decision.

The principle is well-established, in private international law,


that foreign decrees cannot be enforced or recognized if
they contravene public policy (Nussbaum, Principles of
Private International Law, p. 232).
It is thoroughly established as a broad general rule that
foreign law or rights based therein will not be given effect or
enforced if opposed to the settled public policy of the forum.
(15 C.J.S. 853)
SEC. 6. Limitations. In the recognition and enforcement
of foreign laws the Courts are slow to overrule the positive
law of the forum, and they will never give effect to a
foreign law where to do so would prejudice the state's own
rights or the rights of its citizens or where the
enforcement of the foreign law would contravene the
positive policy of the law of the forum whether or not that
policy is reflected in statutory enactments. (11 Am. Jur.,
300-301).
A judgment affecting the status of persons, such as a
decree confirming or dissolving a marriage, is recognized
as valid in every country, unless contrary to the policy of
its own law. Cottington's Case, 2 Swan St. 326, note;
Roach vs. Garvan, I Ves St. 157; Harvey vs. Farnie, LR 8
App. Cas. 43; Cheely vs. Clayton, 110 U.S. 701 [28:298].
(Hilton vs. Guyot 159 U.S. 113, 167; 40 L. Ed. 95, 110)
(Emphasis supplied)
It is, therefore, error for the intervenor to ask that "private
international law rather than Philippine civil law should
decide the instant case", as if the two branches of the law
contradicted one another.
In a consolidated paper (intervenor's rejoinder and appellee
Vicenta Escao's supplemental motion for reconsideration),
the issue is raised that "the Supreme Court cannot reverse
the decision of the lower court dismissing the complaint nor
sentence Vicenta Escao to pay damages, without resolving
the question of lack of jurisdiction over her person".
A resolution by the Supreme Court of the issue of jurisdiction
over the person of appellee Vicenta Escao, and which was
disallowed by the court below, was unnecessary because the
matter was not properly brought to us for resolution, either
on appeal or by special remedy which could have been
availed of by the appellee when the lower court, on 1 June
1957, overruled her challenge to its jurisdiction. Neither was
the alleged error of the lower court put in issue in her brief
as appellee, as it was incumbent upon her to do (Relativo vs.
Castro, 76 Phil. 563; Lucero vs. De Guzman, 45 Phil. 852).
Not affecting the jurisdiction over the subject matter, the
court properly ignored the point (Rev. Rule 51, section 7).

It is urged that the actions for legal separation and for quasidelict have prescribed: the first, because it was not filed
within one year from and after the date on which the plaintiff
became cognizant of the cause; and, the second, because it
was not filed within four years since the Tenchavez-Escao
marriage in 1948.
The argument on both points is untenable.
The action for legal separation was filed on 31 May 1956.
Although in a letter, under date of 10 December 1954, the
Department of Foreign Affairs informed plaintiff Tenchavez
that "According to information, she (appellee) secured a
decree of divorce on October 21, 1950 ... and married an
American citizen, Russel Leo Moran, on September 13,
1954", there is no satisfactory and convincing evidence as to
the time when plaintiff Tenchavez, received the said letter;
nor was she duty-bound to act immediately upon hearsay
information. Since prescription is an affirmative defense, the
burden lay on the defendant to clearly prove it, and her
proof on it was inadequate.
On the argument about the action on tort having prescribed,
the basis thereof is erroneous: the marriage was not the
cause of appellee's wrongful conduct. Her denial of
cohabitation, refusal to render consortium and desertion of
her husband started right after their wedding but such
wrongs have continued ever since. She never stopped her
wrongdoings to her husband, so that the period of limitation
has never been completed.
Finally, we see no point in discussing the question of
appellee Escao's criminal intent, since nothing in the main
decision was designed or intended to prejudge or rule on the
criminal aspect of the case, if any, or any of its constituent
elements. It is to be noted that in this civil case only a
preponderance of evidence is required, and not proof
beyond reasonable doubt. While much could be said as to
the circumstances surrounding the divorce of the appellee,
we prefer to abstain from so doing in order not to influence
in any way the criminal case, should any be instituted.
For the reasons above cited, all motions for reconsideration
are hereby denied.
Concepcion, C.J., Barrera, Dizon, Regala, Makalintal, J.P.
Bengzon, Zaldivar and Sanchez, JJ., concur.
R E S O L UT I O N
September 14, 1966
REYES, J.B.L., J.:

SEC. 7. Questions that may be decided. No error which


does not affect the jurisdiction over the subject matter will
be considered unless stated in the assignment of errors
and properly argued in the brief, save as the court, at its
option, may notice plain errors not specified, and also
clerical errors.
At any rate,
... .When, however, the action against the non-resident
defendant affects the personal status of the plaintiff, as,
for instance, an action for separation or for annulment of
marriage, ..., Philippine courts may validly try and decide
the case, because, then, they have jurisdiction over
the res, and in that event their jurisdiction over the person
of the non-resident defendant is not essential. The res is
the personal status of the plaintiff domiciled in the
Philippines, ... . (1 Moran 411, 1963 Ed., citing Mabanag
vs. Gallemore, 81 Phil. 254)
The award of damages, in the present case, was merely
incidental to the petition for legal separation. For all these
reasons, and because she filed a counterclaim against
plaintiff (Rec. App. pp. 205-206), Vicenta should be deemed
to have withdrawn the objection to the lower court's
jurisdiction over her person, even though she had stated in
the counterclaim that she was not waiving her special
defense of lack of jurisdiction.1wph1.t

Their first motion for reconsideration having been denied,


Vicenta Escao and Russel Leo Moran, through counsel, have
filed a second motion for reconsideration.
It is first averred that this Court's decision contradicts the
doctrine laid down in Banco Espaol Filipino vs. Palanca, 37
Phil. 921, that in proceedings in rem or quasi in rem the
relief must be confined to the res, and the Court cannot
lawfully render a personal judgment.
Movant's own quotation from that decision demonstrates the
diffirence in the facts between the case at bar and the
authority cited. For their own excerpt shows that the rule
now invoked was laid down for instances where the
defendant never submitted to the jurisdiction of our courts.
We said then:
If, however, the defendant is a non-resident, and
remaining beyond the range of the personal process of the
court refuses to come in voluntarily, the court never
acquires jurisdiction over the person at all. ... (Cas. Cit. p.
930)
The defendant Palanca, in 37 Phil. 921, so much refused to
come in voluntarily that he was declared in default. Was this
the case of Vicenta Escao? The records show on their face

that it was not. While she objected to the jurisdiction of the


Court over her person, she also filed an answer with a
counterclaim asking for an award of damages against
plaintiff-appellant Tenchavez. Instead of "refusing to come in
voluntarily", as Palanca did (in 37 Phil. 921), Escao took the
offensive and asked the Court for a remedy, a judgment
against her opponent; and this after the court below
overruled her objection that she was not within its
jurisdiction. In asking the Court for affirmative relief, Escao
submitted to its jurisdiction. In the United States, whence
our adjective law finds its sources, the Federal Supreme
Court has rules (Merchant's Heat & Light Co. vs. Clow &
Sons, 204 U.S. 286, 51 Law Ed. 488):
We assume that the defendant lost no rights by pleading
to the merits, as required, after saving its rights.Harkness
vs. Hyde, 98 U.S. 476, 25 L. ed. 237; Southern P. Co. vs.
Denton, 146 U.S. 202, 36 L. ed. 943, 13 Sup. Ct. Rep. 44.
But by setting up its counterclaim the defendant became
a plaintiff in its turn, invoked the jurisdiction of the court
in same action, and, by invoking, submitted to it. It is true
that the counterclaim seems to have arisen wholly out of
the same transaction that the plaintiff sued upon, and so
to have been in recoupment rather than in set-off proper.
But, even at common law, since the doctrine has been
developed, a demand in recoupment is recognized as a
cross demand, as distinguished from a defense. Therefore,
although there has been a difference of opinion as to
whether a defendant, by pleading it, is concluded by the
judgment from bringing a subsequent suit for the residue
of his claim a judgment in his favor being impossible at
common law, the authorities agree that he is not
concluded by the judgment if he does not plead his cross
demand, and that whether he shall do so or not is left
wholly to his choice. Davis vs. Hedges, L.R. 6 Q.B.
687; Mondel vs. Steel, 8 Mees. & W. 858, 872; O'Connor
vs. Varney, 10 Gray, 231.This single fact shows that the
defendant, if he elects to sue upon his claim in the action
against him, assumes the position of an actor and must
take the consequence. The right to do so is of modern
growth, and is merely a convenience that saves bringing
another suit, not a necessity of the defense. (Emphasis
supplied)
The reason for the rule is manifest. The courts can not look
with favor upon a party adopting not merely inconsistent,
but actually contradictory, positions in one and the same
suit, claiming that a court has no jurisdiction to render
judgment against it, but has such jurisdiction to give to give
a decision in its favor (Dailey vs. Kennedy, 64 Mich. 208, 31
N.W. 125; Harvey vs. Bishop, 171 Okla. 497, 43 Pac. 2d, 48;
Haverstick vs. Southern P. Co. (Calif.) 37 Pac. 2d, 146).
Another reason, equally valid, is that if such defendant
shall ask for any relief other than that addressed to his
plea, he is seeking to gain an unconscionable advantage
over his adversary, whereby, if the determination be in his
favor, he may avail himself of it while if it be against him,
he may fall back upon his plea of lack of jurisdiction of the
person. (Olcese vs. Justice's Court, 156 Calif. 82, 103 Pac.
318).
True, Escao made a reservation of her former plea when
she fled her counterclaim; but such reservation did not
remove the obnoxious contradictory positions she assumed.
Secondly, appellee Vicente Escao not only adopted
inconsistently positions in the court below but abandoned all
pretense that court's lack of jurisdiction over her person
upon appeal to this Court. She made no reference whatever
to that question in her brief as appellee. Coupled with her
previous demand for affirmative relief, Vicente's silence on
appeal only confirms her waiver of the point. Her excuse it
that, the lower court having ruled in her favor, she could not
very well assign as error the overruling of her plea of nonjurisdiction. That excuse is unserviceable; for this Court has
repeatedly held (and it is now well settled) that an appellee
can make counter assignments of error for the purpose of
sustaining the appealed judgement, altho it is not allowed to
ask that the same be reversed or modified (Bunge Corp. vs.
Camenforte Co., 91 Phil. 861, and cases cited therein;
Cabrera vs. Provincial Treasurer of Tayabas, 75 Phil. 780;
Pineda & Ampil vs. Bartolome, 95 Phil. 930; David vs. De la
Cruz, L-11656, April 18, 1958). Having failed to do so, this

Court had every reason to consider the issue of jurisdiction


abandoned, and appellee's belated attempts to resurrect it,
by alleging an imaginary error on our part, are pointless and
vain. The same thing can be said of her effort to escape the
jurisdiction she had invoked in her counterclaim by not
appealing its rejection by the trial court. At most, it amounts
to equivocal conduct that can not revive the inconsistent
claim of non-jurisdiction, abandoned by her seeking
affirmative relief.
Wherefore, the second motion for reconsideration is denied.

G.R. No. L-29959 December 3, 1929


AURELIA DADIVAS DE VILLANUEVA, plaintiff-appellant,
vs.
RAFAEL VILLANUEVA, defendant-appellee.
Harvey and O'Brien for appellant.
Jose G. Generoso for appellee.

STREET, J.:
This action was instituted on May 27, 1927, in the Court of
First Instance of the City of Manila by Aurelia Dadivas de
Villanueva against her husband, Rafael Villanueva, for the
purpose of obtaining separate maintenance and custody of
the two younger minor children, Guillermo and Sergio
Villanueva, as well as a proper allowance for professional
legal services rendered by the plaintiff's attorneys in this
action, as well as costs. Upon hearing the cause the trial
court absolved the defendant from the complaint and
abrogated a prior order of the court for
maintenance pendente lite, with costs against the plaintiff.
From this judgment the plaintiff appealed.
The plaintiff, Aurelia Dadivas de Villanueva, was married to
the defendant, Rafael Villanueva, on July 16, 1905, in the
City of Manila, where the pair have since resided. To them
have been born three children, namely, Antonio, Guillermo,
and Sergio, who were, at the time of the trial of this case in
the lower court, aged respectively 18, 10 and 9 years. The
grounds on which separate maintenance is sought infidelity
and cruelty. With respect to the first of these charges the
proof shows that during the period of about ten years prior
to the institution of the action, the defendant was guilty of
repeated acts of infidelity with four different women, and
even after the action was begun, he is shown to have had
illicit relations with still another, an incident which is
incorporated in the case by means of the amended
complaint. Thought at all times protesting against these
irregularities in her husband's conduct, the plaintiff appears
to have exhibited forbearance; and she long continued in
marital relations with him with a view to keeping the family
intact as well as with hope of retrieving him from his erring
course. In the end, however, the incorrigible nature of the
defendant in his relations with other women, coupled with a
lack of consideration and even brutality towards the plaintiff,
caused her to withdraw from the domestic hearth and to
establish a separate abode for herself and two younger
children. This final separation occurred on April 20, 1927,
about one month before the present action was begun.
The proof with respect to the charge of cruelty shows that
the defendant has not infrequently treated the plaintiff
roughly and that he has at times directed abusive words to
her and challenged her to carry her troubles into court. The
proof in support of this charge does not in our opinion
establish a case for separate maintenance, without relation
to the graver charge of conjugal infidelity; and if the case
depended, for its solution, upon cruelty alone, the case could
doubtless be affirmed, in conformity with the doctrine stated
in Arroyo vs. Vazquez de Arroyo (42 Phil. 54), where the
charges of cruelty were found to be unproved or insufficient.
In that case, however, we were able to record the fact that
neither of the spouses had at any time been guilty of
conjugal infidelity, and that neither had, so far as the proof

showed, even given just cause to the other to suspect illicit


relations with any person. In the case before us repeated
acts of conjugal infidelity on the part of the husband are
proved, and he appears to be a recurrent, if not an incurable
offender against the sanctity of the marriage tie. This give
the wife an undeniable right to relief.
The law is not so unreasonable as to require a wife to live in
marital relations with a husband whose incurable propensity
towards other women makes common habitation with him
unbearable. Deeply rooted instincts of human nature
sanction the separation in such case, and the law is not so
unreasonable as to require as acquiescence on the part of
the injured party which is beyond the capacity of nature. In
order to entitle a wife to maintain a separate home and to
require separate maintenance from her husband it is not
necessary that the husband should bring a concubine into
the marital domicile. Perverse and illicit relations with
women outside of the marital establishment are enough. As
was said by Justice Moreland in Goitia vs. Campos Rueda (35
Phil., 252, 262), a husband cannot, by his own wrongful acts,
relieve himself from the duty to support his wife imposed by
law; and where a husband by wrongful, illegal, and
unbearable conduct, drives his wife from the domicile fixed
by him, he cannot take advantage of her departure to
abrogate the law applicable to the marital relations and
repudiate his duties thereunder.
In her complaint the plaintiff asks for an allowance of P750
per month, but we are of the opinion that the sum of P500
per month will suffice, this being in addition to the use which
she makes for living quarters of a modest property
belonging to the conjugal estate. During their marital life the
spouses have acquired real estate which, at the time of the
trial, was assessed at more than P85,000, and which at the
same time was reasonably valued at more than P125,000. In
addition to this the defendant appears to be now earning a
substantial salary in commercial activities. The plaintiff is
also entitled to an allowance for attorney's fees which we fix
at P1,000 for services rendered in the trial court and the
same amount for services rendered in this court. It appears
that the two younger children are now living with the
plaintiff, and her right to their custody will not be disturbed.
While this litigation was pending in the lower court the
defendant was required to pay the amount of P500 per
month for maintenance of the plaintiff, under an
interlocutory order of June 15, 1927. But these payments
ceased when the appealed decision was promulgated on or
about the end of March, 1928. The plaintiff in this case is
therefore entitled to judgment at the rate of P500 per month
beginning April 1, 1928, until judgment shall be promulgated
in this case, and from that date the defendant will be
required to pay P500 per month for maintenance as already
suggested. The plaintiff will also be awarded the sum of
P720 in satisfaction of the amount paid out for the transcript
necessary to this appeal.
The judgment is therefore reversed, and it is ordered that
the plaintiff have and recover of the defendant the sum of
P2,000 for attorney's fees, the sum of P720 for expenses of
procuring transcript, and the sum of P500 per month,
beginning April 1, 1928, until the promulgation of this
decision, after which the date the defendant is ordered to
pay to the plaintiff by way of maintenance, on or before the
10th day of each month, the sum of P500. So ordered, with
costs against appellee.

G.R. No. L-28904

December 29, 1928

CIPRIANA GARCIA, plaintiff-appellant,


vs.
ISABELO SANTIAGO and ALEJO SANTIAGO, defendantsappellees.
Gregorio Perfecto for appellant.
M. H. de Joya and Pompeyo Diaz for appellees.

OSTRAND, J.:

This is an appeal but the plaintiff from a judgment of the


Court of First Instance of Nueva Ecija dismissing the
complaint.
In her complaint the plaintiff alleges that she was married to
the defendant Isabelo Santiago on April 8, 1910, and that
from that date they lived together as husband and wife, until
continued family dissentions compelled her to leave the
conjugal dwelling on February 3, 1925; that defendant Alejo
Santiago is a son of Isabelo Santiago by his first wife, and
Prisca Aurelio is a daughter of plaintiff by her first husband;
that said Alejo Santiago seduced Prisca Aurelio, and the
latter gave birth to a child; and that the other defendant
Isabelo Santiago, instead of seeing to the vindication of the
honor of plaintiff's daughter by requiring his son to marry
her, has refused to have anything to do with the matter,
thus seemingly countenancing the illicit relations between
them; that with a view to favoring materially the said Alejo
Santiago and fostering his whims and caprices, defendant
Isabelo Santiago has been conveying, and is attempting to
convey, to said Alejo Santiago property belonging to their
conjugal partnership, to the damage and prejudice of
plaintiff's rights; that, among the property that defendant
has conveyed or is attempting to convey Alejo Santiago, the
lands specially described in the complaint are the most
important ones, which, with others, had been acquired by
plaintiff and defendant Isabelo Santiago during their married
life with money belonging to the conjugal partnership, and
with the products and fruits of the property of the conjugal
partnership, or through the industry of the two; that said
property produces annually around the neighborhood of
4,500 cavanes of palay at P4 per cavan; that by reason of
the attitude of defendant Isabelo Santiago, respecting the
illicit relations of his son and Prisca Aurelio, and his
fraudulent acts conveying to said Alejo Santiago property
belonging to the conjugal partnership, plaintiff and Isabelo
Santiago have been several discussions and quarrels, which
culminated in their separation of February 3, 1925, which
separation became necessary in order to avoid personal
violence; that notwithstanding plaintiff's repeated demands,
defendants Isabelo Santiago has continually refused to
provide for her support, and plaintiff could not live in their
conjugal dwelling, because of illicit relations between Alejo
Santiago and Prisca Aurelio, countenance by the other
defendant Isabelo Santiago; that taking into consideration
the actual financial conditions of the conjugal partnership,
plaintiff is entitled to a monthly pension P500 pendente lite;
and that in the meanwhile, the court should restrain
defendant Isabelo Santiago from conveying of attempting to
convey any property of the conjugal partnership; that
defendant Isabelo has publicly maintained illicit relations
with a woman by the name of Geronima Yap; and that by
said immoral conduct and acts, defendant Isabelo Santiago
has shown himself unfit to administer the property of the
conjugal partnership, and the court should therefore order
that its administration be placed in the hands of plaintiff.
The defendants' answer to the complaint was a general
denial.
The appellant makes the following assignments of error:
(1) The court erred in declaring her separation from the
defendant Isabelo Santiago unjustified.
(2) The court erred in dissolving the preliminary injunction
and refusing to set aside the transfer of title made by
Isabelo Santiago in favor of Alejo Santiago.
(3) The court erred in not granting the plaintiff the right to
administer the conjugal property.
(4) The court erred in not granting the plaintiff the right to
administer the conjugal property.
(5) The court erred in not granting the other remedies
prayed for in the complaint.
The second and fourth assignments of error are entirely
without merit. The plaintiff has failed to prove that the
property conveyed to Alejo Santiago is community property;
on the contrary, it is shown by documentary evidence that
the land was acquitted by Isabelo Santiago previously to his

marriage to the plaintiff. Neither can we find any sufficient


reason for depriving the husband of his right to administer
such conjugal property as may exist.1awphi1.net
The first and third assignments of error deserved some
consideration. It clearly appears that the spouses led a
rather stormy life subsequent to the dishonor of the
plaintiff's daughter, Prisca, and that husband, according to
the plaintiff's testimony, went so far as to order her to leave
his house and threatened to illtreat her if she returned. It
also appears that, aside from the quarrels, she had very
unpleasant experiences in other respects. Her young
daughter was, and still, under her care, and her assertion
that her husband's son was the cause of her daughter's
pregnancy is probably not unfounded. It requires no stretch
of the imagination to conclude that to keep the two young
people under the same roof with the opportunity to continue
their illicit relations would create a very embarrassing
situation for the girl's mother.
Taking into consideration the facts stated, we do not think
that the plaintiffs' separation from the husband in
unjustified. Ordinarily, it is not the fault of one that two
quarrel, and in all probability, the plaintiff is not free from
blame, but she was virtually driven out of their home by her
husband and threatened with violence if she should return.
Under these circumstances, to compel the plaintiff to cohabit
with her husband can only lead to further quarrels and would
probably be unfortunate for both parties. The separation
therefore seems necessary.
As to the plaintiff's maintenance allowance it is the evident
that the sum of P500 monthly is much too large and that an
allowance of P50 per month is all that ought be granted at
present.
The fifth assignment of error relates principally to the
plaintiff's prayer for an allowance of attorney's fees. Under
the circumstances of the case, we do not think that the court
below erred in refusing to grant such allowance.
The judgment appealed from is therefore modified, and it is
ordered that the defendant, Isabelo Santiago, pay to the
plaintiff the sum of P50 per month for her maintenance and
that such payments be made within the first ten days of
each month. No costs will be allowed. So ordered.

G.R. No. L-11086

March 29, 1958

PILAR ATILANO, plaintiff-appellee,


vs.
CHUA CHING BENG, defendant-appellant.
Quisumbing, Sycip & Associates for appellant.
Jose G. Bermas, Jr. for appellee.
FELIX, J.:
The facts of this case as appearing on record and in the
stipulation submitted by the parties and approved by the
lower court, are as follows:
Chua Ching Beng and Pilar Atilano were joined in lawful
wedlock in Zamboanga City in May of 1951, after which
marriage, the couple sailed for Manila and established their
residence with the parents of the husband. In October of the
same year, at the husband's initiative, they went to
Zamboanga City to pay the parents of the wife a visit, and it
seems that he was prevailed upon by the wife's parents to
return to Manila leaving her behind, with the understanding
that she would follow him later, which apparently she failed
to do.
On September 30, 1953, Pilar Atilano filed with the Court of
First Instance of Zamboanga a complaint for support against
her husband, alleging that they had been estranged and
living separately since October, 1952, by reason of incessant
marital bickerings and quarrels brought about by

incompatibility of temperament and above all, by


defendant's inability to provide for themselves a home
separate from the latter's parents; that she was staying with
her parents in Zamboanga City, without employment nor
had she any property of her own. She therefore, prayed that
as defendant was under legal obligation to support her, he
be ordered to give her a monthly allowance, P200.00 from
the date of the filing of the complaint.
Defendant husband filed his answer contending that when
they were still residing in Manila, their married life was
characterized by harmony and understanding; that when
they visited plaintiffs parents in Zamboanga in October
1952, he was prevailed upon by the latter to allow his wife to
stay with them a while with the understanding that she
would follow him later to Manila; that through insidious
machinations, plaintiff's parents caused her to be alienated
from him resulting in her refusal to return to Manila and live
with her husband again; that defendant went back to
Zamboanga City to fetch her, but through force and
intimidation she was prevented by her parents from going
with him; and that her parents also exerted undue pressure
and influence upon his wife to file the complaint. Defendant
further averred that while he was not evading his obligation
to support his, he preferred to fulfill said duty by receiving
and maintaining her in Manila; that as the husband,
defendant had the right to fix the residence of his family,
and he would even be willing to establish a conjugal dwelling
in Manila separate from that of his parents if that was the
plaintiff's desire. Thus, it was prayed that the complaint be
dismissed.
In the meantime, plaintiff filed a petition for
alimony pendente lite premised on the same facts as, stated
in her complaint, which was duly opposed by the defendant,
and on May 3, 1954, based on stipulation of facts agreed
upon by the parties, the court rendered judgment granting
the wife a monthly allowance of P75 after finding that the
wife's refusal to return to Manila was caused by her aversion
to stay with the parents of her husband after she had
experienced some previous in-law troubles; that her demand
that they establish their home in Zamboanga could not be
met by the husband because of the latter's job in Manila and
due also to the husband's fear that his wife would always be
under the influence and pressure of the latter's parents. No
evidence was, however, adduced to support her allegation of
incompatibility of temperament and marital quarrels, and
upon receipt of the decision, defendant filed a petition
electing to fulfill his; obligation as thus fixed by the trial
court by receiving and maintaining plaintiff at his residence
at Pasay City, which was, apart, from that of his parents,
with the prayer that in the event, plaintiff would refuse to
receive support under that set-up, that he be declared
under, no compulsion to remit the allowance to her at
Zamboanga City. As it was denied, defendant brought the
matter to the Court of Appeals, but this Tribunal certified the
case to Us for adjudication pursuant to the provisions of
Section 17-6 of Republic Act No. 296. The only question
presented for, our consideration by this appeal is whether a
wife is entitled to received support from his husband where
she refused to live with him on account of some
misunderstanding she had with the husband's immediate
relatives.
It is clear to Us, and this is borne out by the findings, of the
court a quo, that plaintiff wife, then 19 yeas of age, had the
unfortunate experience of finding herself in some sort of
domestic controversy, with her husband's immediate
relatives in the opposite camp, which made her feel that
living with them would already be intolerable and
unbearable. Most likely, therefore, when they visited her
parents, she recounted her plight to them and as the usual
reaction of parents in matters of this nature, they picked up
and championed the cause of their daughter which resulted
in the estrangement of the young couple. Indeed
disagreement among in-laws is a problem as old as the
world itself, but despite this discouraging facet of married
life there would always be in-laws as long there are
marriages and the same vicious cycle would be repeated. In
the case at bar, which is a clear illustration of this perennial
domestic problem, We find that while the wife remains
adamant on her stand to effect a separation in fact between
her and her husband, the latter, has adopted a more
conciliatory attitude by acknowledging his obligation to

support her and even going to the extent of expressing his


willingness to abide by her wish to have a conjugal dwelling
apart from his parents, although it, appears that he may find
it hard to make adequate provisions for their family, for he is
allegedly receiving a salary of only 170 a month as salesman
in a commercial firm. Defendant does not dispute that our
civil Code imposes on the husband the responsibility of
maintaining and supporting, his wife and the rest of the
family (Art. 111). He insists, however, that under the, Civil
Code, which provides:
ART. 299. The person obliged to give support may, at his
option, fulfill his obligation either by paying the
allowance fixed, or by receiving and maintaining in his
house the person who has a right to receive support.
The latter alternative cannot be availed of in this case
there is a moral or legal obstacle thereto;
he is given the option to fulfill the said duty either by paying
the allowance as fixed by the Court or receiving and
maintaining the person entitled thereto in his house; and
that he elects to perform his obligation by the second means
allowed him by law.
The aforeqouted provision of the law is clear enough to
require any further elucidation. In giving the obligor the
option to fulfill his duty, it provides for only one occasion
when the second alternative could not be availed of i.e.,
when there is a moral or legal obstacle thereto. It is true that
plaintiff wife charged that they were estranged because of
marital troubles and incessant bickering. While physical illtreatment may be ground to compel a husband to provide a
separate maintenance for his wife ( Arroyo vs. Vasquez de
Arroyo, 42 Phil., 54 ) said allegation was not proved during
the trial. Instead, the lower court found that the root-cause
of all their differences could be traced to disagreements
common among relatives by affinity. Certainly, We do not
think that misunderstanding with in-laws, who may be
considered third parties to the marriage, is the moral or legal
obstacle that the lawmakers contemplated in the drafting of
said provision. The law, in giving the husband authority to fix
the conjugal residence (Art. 110), does not prohibit him from
establishing the same at the patriarchal home, nor is it
against any recognized norm of morality, especially if he is
not fully capable of meeting his obligation as such head of a
family without the aid of his elders. But even granting
arguendo that it might be "illegal" for him to persist on living
with his parents over the objection of his wife, this argument
becomes moot in view of defendant's manifestation that he
is willing to establish a residence, separate from his parents,
if plaintiff so desires. We are aware are that although the
husband and the wife are, obliged to live together, observe
mutual respect and fidelity and render mutual help and
assistance ( Art. 109), and that the wife is entitled to be
supported, our laws contain no provision compelling the wife
to live with her husband where even without legal
justification she establishes her residence apart from that
provided for by the former, yet and in such event We would
see no plausible reason why she should be allowed any
support from the husband. It appearing that defendant
husband availed of the option granted him by Article 299 of
the Civil Code and there being no legal or moral hindrance to
the exercise of the second alternative as elected by him, the
answer to the question presented by this appeal is certainly
obvious.
Wherefore, the decision appealed from is hereby modified by
giving the defendant husband Chua Ching Beng the option
of supporting his wife at their conjugal dwelling apart from
the home of the parents of the husband. Should plaintiff wife
refuse to abide by the terms of this decision, then the
defendant-appellant shall be considered relieved from the
obligation of giving any support to his wife. Without
pronouncement as to costs. It is so ordered.

G.R. No. L-4089

January 12, 1909

ARTURO PELAYO, plaintiff-appellant,


vs.
MARCELO LAURON, ET AL., defendants-appellees.
J.H. Junquera, for appellant.
Filemon Sotto, for appellee.
TORRES, J.:
On the 23rd of November, 1906, Arturo Pelayo, a physician
residing in Cebu, filed a complaint against Marcelo Lauron
and Juana Abella setting forth that on or about the 13th of
October of said year, at night, the plaintiff was called to the
house of the defendants, situated in San Nicolas, and that
upon arrival he was requested by them to render medical
assistance to their daughter-in-law who was about to give
birth to a child; that therefore, and after consultation with
the attending physician, Dr. Escao, it was found necessary,
on account of the difficult birth, to remove the fetus by
means of forceps which operation was performed by the
plaintiff, who also had to remove the afterbirth, in which
services he was occupied until the following morning, and
that afterwards, on the same day, he visited the patient
several times; that the just and equitable value of the
services rendered by him was P500, which the defendants
refuse to pay without alleging any good reason therefor; that
for said reason he prayed that the judgment be entered in
his favor as against the defendants, or any of them, for the
sum of P500 and costs, together with any other relief that
might be deemed proper.
In answer to the complaint counsel for the defendants
denied all of the allegation therein contained and alleged as
a special defense, that their daughter-in-law had died in
consequence of the said childbirth, and that when she was
alive she lived with her husband independently and in a
separate house without any relation whatever with them,
and that, if on the day when she gave birth she was in the
house of the defendants, her stay their was accidental and
due to fortuitous circumstances; therefore, he prayed that
the defendants be absolved of the complaint with costs
against the plaintiff.
The plaintiff demurred to the above answer, and the court
below sustained the demurrer, directing the defendants, on
the 23rd of January, 1907, to amend their answer. In
compliance with this order the defendants presented, on the
same date, their amended answer, denying each and every
one of the allegations contained in the complaint, and
requesting that the same be dismissed with costs.
As a result of the evidence adduced by both parties,
judgment was entered by the court below on the 5th of April,
1907, whereby the defendants were absolved from the
former complaint, on account of the lack of sufficient
evidence to establish a right of action against the
defendants, with costs against the plaintiff, who excepted to
the said judgment and in addition moved for a new trial on
the ground that the judgment was contrary to law; the
motion was overruled and the plaintiff excepted and in due
course presented the corresponding bill of exceptions. The
motion of the defendants requesting that the declaration
contained in the judgment that the defendants had
demanded therefrom, for the reason that, according to the
evidence, no such request had been made, was also denied,
and to the decision the defendants excepted.
Assuming that it is a real fact of knowledge by the
defendants that the plaintiff, by virtue of having been sent
for by the former, attended a physician and rendered
professional services to a daughter-in-law of the said
defendants during a difficult and laborious childbirth, in
order to decide the claim of the said physician regarding the
recovery of his fees, it becomes necessary to decide who is
bound to pay the bill, whether the father and mother-in-law
of the patient, or the husband of the latter.
According to article 1089 of the Civil Code, obligations are
created by law, by contracts, by quasi-contracts, and by

illicit acts and omissions or by those in which any kind of


fault or negligence occurs.
Obligations arising from law are not presumed. Those
expressly determined in the code or in special laws, etc., are
the only demandable ones. Obligations arising from
contracts have legal force between the contracting parties
and must be fulfilled in accordance with their stipulations.
(Arts. 1090 and 1091.)
The rendering of medical assistance in case of illness is
comprised among the mutual obligations to which the
spouses are bound by way of mutual support. (Arts. 142 and
143.)
If every obligation consists in giving, doing or not doing
something (art. 1088), and spouses are mutually bound to
support each other, there can be no question but that, when
either of them by reason of illness should be in need of
medical assistance, the other is under the unavoidable
obligation to furnish the necessary services of a physician in
order that health may be restored, and he or she may be
freed from the sickness by which life is jeopardized; the
party bound to furnish such support is therefore liable for all
expenses, including the fees of the medical expert for his
professional services. This liability originates from the
above-cited mutual obligation which the law has expressly
established between the married couple.
In the face of the above legal precepts it is unquestionable
that the person bound to pay the fees due to the plaintiff for
the professional services that he rendered to the daughterin-law of the defendants during her childbirth, is the
husband of the patient and not her father and mother- inlaw, the defendants herein. The fact that it was not the
husband who called the plaintiff and requested his
assistance for his wife is no bar to the fulfillment of the said
obligation, as the defendants, in view of the imminent
danger, to which the life of the patient was at that moment
exposed, considered that medical assistance was urgently
needed, and the obligation of the husband to furnish his wife
in the indispensable services of a physician at such critical
moments is specially established by the law, as has been
seen, and compliance therewith is unavoidable; therefore,
the plaintiff, who believes that he is entitled to recover his
fees, must direct his action against the husband who is
under obligation to furnish medical assistance to his lawful
wife in such an emergency.
From the foregoing it may readily be understood that it was
improper to have brought an action against the defendants
simply because they were the parties who called the plaintiff
and requested him to assist the patient during her difficult
confinement, and also, possibly, because they were her
father and mother-in-law and the sickness occurred in their
house. The defendants were not, nor are they now, under
any obligation by virtue of any legal provision, to pay the
fees claimed, nor in consequence of any contract entered
into between them and the plaintiff from which such
obligation might have arisen.
In applying the provisions of the Civil Code in an action for
support, the supreme court of Spain, while recognizing the
validity and efficiency of a contract to furnish support
wherein a person bound himself to support another who was
not his relative, established the rule that the law does
impose the obligation to pay for the support of a stranger,
but as the liability arose out of a contract, the stipulations of
the agreement must be held. (Decision of May 11, 1897.)
Within the meaning of the law, the father and mother-in-law
are strangers with respect to the obligation that devolves
upon the husband to provide support, among which is the
furnishing of medical assistance to his wife at the time of her
confinement; and, on the other hand, it does not appear that
a contract existed between the defendants and the plaintiff
physician, for which reason it is obvious that the former can
not be compelled to pay fees which they are under no
liability to pay because it does not appear that they
consented to bind themselves.

The foregoing suffices to demonstrate that the first and


second errors assigned to the judgment below are
unfounded, because, if the plaintiff has no right of action
against the defendants, it is needless to declare whether or
not the use of forceps is a surgical operation.
Therefore, in view of the consideration hereinbefore set
forth, it is our opinion that the judgment appealed from
should be affirmed with the costs against the appellant. So
ordered.

G.R. No. L-13114

August 29, 1961

ELENITA LEDESMA SILVA, ET AL., plaintiffs-appellants,


vs.
ESTHER PERALTA, defendant-appellee.
E.B. Garcia Law Offices and Ledesma, Puno Guytingco and
Antonio & Associates for plaintiffs-appellants.
Quijano, Abellera, Santos Corrales & Nitrorreda for
defendant-appellee.
RESOLUTION
REYES, J.B.L., J.:
Appellants spouses Saturnino Silva and Elenita LedesmaSilva
pray for reconsideration of this Court's decision of November
25, 1960, claiming that
(1) Appellant Elenita Silva should be awarded moral
damages for Esther Peralta's unauthorized use of the
designation of "Mrs. Esther Silva";
(2) The award of pecuniary damages against appellant
Saturnino Silva is unwarranted by the facts and the law.
It is contended that the prohibition imposed upon appellee
Esther Peralta from representing herself, directly or
indirectly, as the wife of Saturnino Silva should result in an
award of moral damages in favor of appellant Elenita
Ledesma, whose exclusive right to the appellation is
recognized by the decision.
This argument misapprehends the bias of the decision.
Esther Peralta was forbidden from representing herself as
Mrs. Saturnino Silva for the reason that it was proved in this
case that she was not legally married to him, and because
he is now lawfully married to Elenita Ledesma. But an award
of damages in the latter's favor would require a further
finding that the assumption of the disputed status by Esther
Peralta was made in bad faith or through culpable
negligence and no such finding has been made in the
decision. The facts are that the Esther in good faith regarded
herself as Saturnino's lawful wife, and that the man himself
led her into this belief prior to his desertion. That later on,
unknown to Esther, Silva should have married his coappellant in the United States is not sufficient to impose
upon Esther any liability for damages or to destroy her
original good faith, there being no proof that the existence of
a valid marriage between Saturnino and Elenita was
adequately driven home to Esther before this case was
instituted. That the two appellants Silva were living together
as husband and wife was certainly not sufficient proof,
considering Saturnino Silva's past history and conduct. How
was appellee to know that Saturnino's connection with
Elenita Ledesma was any more legitimate than his previous
one with appellee herself?
Moreover, the trial court found Elenita Silva's claim for
damages not adequately proved, and we have not found in
the record any justification to depart from that finding.
II
As to the award of damages against Saturnino Silva, it is to
be noted that while the latter's liability was extra-contractual
in origin, still, under the Civil Code of 1889, the damages
resulting from a tort are measured in the same manner as
those due from a contractual debtor in bad faith, since he
must answer for such damages, whether he had foreseen
them or not, just as he must indemnify not only for dumnum
emergens but also forlucrum cessans, as required by Article
1106. Article 1902 of the 1889 Civil Code of Spain
formulated no standard for
measuring quasidelictual damages, the article merely
prescribing that the guilty party "shall be liable for the
damages so done". This indefiniteness led modern civil law
writers to hold that the standards set in Articles 1106 and
1107, place in the general rules on obligations, "rigen por

igual para las contractuales y las extra contractuales, las


preestablecidas y las que broten ex-lege de actos ilicitos".
(Roces, Notesto Fisher, "Los Daos Civiles y su Reparacion,"
(1927). Since liability for damages arises in either case from
a breach of a pre-existing obligation (to behave without fault
or negligence in case of quasi-delicts, and, in case of
contracts, to observe the conduct required by the
stipulation),it is logical to conclude with Planiol that "La
responsabilidad contractual y la extra contractual tienen el
mismo fundamento, por lo que se hallan sujetas en principio
a identicas regalas" (6 Planiol-Ripert, Derecho Civil, p.
529,sec. 378). Giorgi is of the same opinion (5 Teoria de
Obligaciones, pp. 133, 207-208). So is de Cossio y Corral("El
Dolo en el Derecho Civil", pp. 132-133):
Pero si ello es asi, resulta claro que la aproximacionentre
esta clase de culpa y la contractual, es cada dia
mayor,hasta el extremo de que, segun hemos antes
indicado solamente se pueden sealar diferencias
accessorias, y muchas veces aparentes entre una y otra.
En primer termino, porque el conceptode culpa
contractual se extiende no solo a las obligacionesnacidas
ex contractu, sino, en general, a todas aquellas
preexistentes entre las partes a la realidad del acto
daoso (obligaciones legales). de otra parte, porque si
bien consideramoslas cosas, la responsabilidad llamada
extracontractual, deriva siempre del quebrantamiento de
un deber general, implicitamentereconocido por la ley,
cual es el de que todos deben actuar socialmente con la
debida diligencia, evitando causar dano a los demas, y
una dercho que todo ciudadano tine, correlativamente,a
no ser da__ado en su patrimonio y bienes por la
conducta dolosa o negligente de los demas. En tal
sentido, habria siempre entre el autor del dao y la
victima, una relacion juridica,constituida por este
derecho y aquel deber.
Este idea de unidad entre ambas instituciones se traduce
en que las pretendidadas diferencias en order a la
extension de la indemnizacion, en ambos casos, no
puedan defenderse a la vista de los preceptos de nuestro
Derecho positivo. En efectono contiene el Capitulo II del
Titulo XVI del Libro IV de nuestroCodigo civil norma
alguna referente a la extension de la indemnizacion que
en cada caso haya de prestarse, lo que nosobliga
forzosamente a acudir a las normas general
contenidasen el Capitulo II, del Titulo I de dicho libro, IV,
relativeo a los "efectos de los obligaciones", que ninguna
razon peermite limitar.a naturaleza contractual, ya que el
articulo 1.101 hable genericamente de obligaciones el
1.102, de "todas las obligaciones";el 1.103, de toda clase
de obligaciones", y en ninguno de los articulos
subsifuientes se hace referencia a una clase especial de
obligaciones, sino a todas en general.
Que las disposiciones de este Capitulo son aplicables en
loscasos de culpa extracontractual, es doctrina
constantemente reconocida, por la jurisprudencia del
Tribunal Supremo. Asi,en la sentencia de 14 de diciembre
de 1894, concretandose a losarticulos 1.101, 1.103 y
1.104, afirma que son de caracter generaly applicables a
toda clase de obligaciones, no ofreciendocontradiccion
con las especiales de los articulos 1.902 y 1.903; la
sentencia de 15 de enero de 1902, permite interpretar
los articulos1.902, t 1.903 por los 1.103 y 1.106, a los
efectos de determinar los elementos que han de entrar
en la indemnizacion.La misma doctrina se mantiene en la
senencia de 2 de diciembrede 1946, y en otras muchas
que puedieramos aducir.
Whether or not the damages awarded to appellee are a
natural and direct consequence of Silva's deceitful
maneuvers in making love to appellee, and inducing her to
yield to his advances and live with him as his wife (when
Silva knew all the time that he could not marry Esther
Peralta because of his undissolved marriage to an Australian
woman, a prior wedlock that he concealed from appellee), is
a question of appreciation. It is clear that Esther Peralta
would not have consented to the liaison had there been no
concealment of Silva's previous marriage, or that the birth of
the child was a direct result of this connection. That Esther
had to support the child because Silva abandoned her before
it was born is likewise patent upon the record, and we can

not see how said appellant can be excused from liability


therefor.
Silva's seduction and subsequent abandonment of appellee
and his illegitimate child were likewise the direct cause for
the filling of the support case in Manila, and in order to
prosecute the same, appellee had to quit her employment in
Davao. While the case could have been filed in Davao, we do
not believe that this error in selecting a more favorable
venue (due to her unfamiliarity with the technicalities of the
law) should be allowed to neutralized the appellant Silva's
responsibility as the primary causative factor of the
prejudice and damage suffered by appellee.
It is argued that the maintenance of the child can not be
considered as an element of damage because the child's
case for support was dismissed. This contention fails to take
into account the action there was for support as an
acknowledged natural child, and that under the Civil Code of
1889 (the law in force when the child was born), the right of
natural children to be supported by their father depended
exclusively on the recognition by the father of his paternity;
the rule being that
the mere fact of birth gave no legal right to the child, and
imposed no legal duty upon the father, except, perhaps, in
cases arising under the criminal law.. . . The father was
not, prior to the Civil Code, and is not now, bound to
recognize his natural son by reason of the mere fact that
he is the father. . . . But as to the father the question is,
and always has been, Has he performed any acts which
indicate his intention to recognize the child as his?"
(Buenaventura vs. Urbano, 5 Phil., pp. 2-3).
It follows that in said suit, the real issue was whether the
child had been duly recognized, the support being a mere
consequence of the recognition. Therefore, the failure of the
child's action for support did not adjudge that he was not the
defendant's child, but that the defendant never recognized
him as such. That the decision of the Court of Appeal (CAG.R. No. 24532-R) rejecting the child's action did not declare
him without right to support under all circumstances can be
seen from the following statement in the decision:

Appellants also contend that the claim for pecuniary


damages has prescribed, because they date back to 1945.
Suffice it to note that the defense of prescription was not
invoked by appellants against the claim for pecuniary
damages, and this defense must be regarded as waived in
relation to the same. Appellant's reply to the appellee's first
counterclaim in her second amended answer (which was for
actual or pecuniary damages) read as follows (Answer to
Counterclaim, Rec. App. p. 33):
1. That plaintiff is without knowledge or
information sufficient to to form a belief as to the
truth of the allegations continued under paragraphs
6, 7, 8, 9, 10, 11 and 12 of the first counterclaim
and, therefore, specifically denies the same.
The defense of prescription was actually interposed only
against the second counterclaim, in this wise:
1. That the cause of action alleged in the second
counterclaim has already prescribed more than ten years
having already elapsed. (Answer to Counterclaim, Rec.
App., p. 34).
The second counterclaim referred to was for damages due to
"mental torture, anguish and hurt feelings, all to her damage
in the amount of P250,000." (Rec. App. p. 28).Upon the other
hand, our own award for moral damages was based, not on
the deceit practiced by Silva in securing Esther's assent to
live maritally with him, but on his subsequent harassment of
her in 1945, by filing suit against her in different provinces
and otherwise applying pressure to cause her to abandon
her child's case. As this cause of action arose less than three
years before the present action was filed, the defense of
prescription is rendered untenable against it, for the
limitation period had not yet expired when the suit was
brought.
WHEREFORE, the motion for reconsideration is denied.

G.R. No. L-41427 June 10, 1988


The proofs so far found in the record may possibly warrant
the filing of an action for compulsory recognition, under
paragraphs 3 and 4 of Art. 283, but there was no action
presented to that effect.
Plainly, the issues and parties being different, the result of
the child's action can not constitute res judicata with regard
to the mother's claim for damages against the father on
account of the amounts she was compelled to spend for the
maintenance of their child. On the contrary, the very fact
that the child was not allowed to collect support from the
father (appellant therein) merely emphasizes the account of
his birth and rearing, which, in turn, was a direct
consequence of appellant's tortious conduct. Since Esther
Peralta had expressly that she had to support the child
(Record of Appeal, p. 27, in fine),and had prayed for such
relief "as may be deemed just and equitable in the
premises", there is no reason why her expenses for the
child's maintenance should not be taken into account.
Appellants submit that the damages allowed for
maintenance of the son should be limited to P600.00 a year,
because the income tax law allows only that much deduction
for each child. We do not believe that income tax deductions
constitute a reasonable basis for an award of damages,
since they are fixed an entirely different purpose (to arrive at
the net taxable income) and merely represent the amount
that the state is willing to exempt from taxation. At that, it
should be noted that the deductible amount has been lately
increased to P1,000.00 per annum. But even at P600.00 per
annum, the damage suffered by appellee on this count, from
1945 to 1960, already amount to around P9,000.00 a year,
to which must be added the loss of appellee's salary as
executive of the Girl Scouts in Davao; so that the P15,000.00
damages awarded by the court below is by no means
excessive, as already held in our decision in chief.

CONSTANCIA C. TOLENTINO, petitioner,


vs.
COURT OF APPEALS and CONSUELO
DAVID, respondents.

GUTIERREZ, JR., J.:


The issue in this petition for review on certiorari is whether
or not a woman who has been legally divorced from her
husband may be enjoined by the latter's present wife from
using the surname of her former husband.
A complaint was filed by petitioner Constancia C. Tolentino
with the then Court of First Instance of Quezon City against
Consuelo David for the purpose of stopping and enjoining
her by injunction from using the surname Tolentino. The
complaint also contained a claim for damages which the
petitioner, however, waived. An application for a writ of
preliminary injunction was filed as well.
On January 13, 1972 respondent Consuelo David filed her
answer admitting she has been using and continues to use
the surname Tolentino.
The application for the writ was heard with both parties
presenting evidence in support of their respective claims.
On January 18, 1972, the trial court issued an order granting
the petitioner's action for a writ of preliminary injunction
with the actual writ being issued on January 20, 1972. The
order granting said writ reads:

NOW, THEREFORE, it is hereby ordered by the


undersigned Judge of the Court of First Instance of Rizal,
Branch XVI, Quezon City, that, until further orders, you
CONSUELO DAVID, your agents and/or representatives
and/or persons acting under your control, direction,
instruction and/or supervision, ARE ENJOINED from
using, employing and/or applying, in any manner, form
or means whatsoever, the surname TOLENTINO. (p. 17,
Original Record On Appeal)
On February 2, 1972, respondent Consuelo filed a motion for
leave to file a third party complaint against her former
husband. The motion was granted on March 18,1972.
Thereafter, third party defendant Arturo Tolentino filed his
answer on April 19,1972.
After the hearings, the trial court rendered a decision in
favor of the petitioner. The dispositive portion of the decision
reads:
WHEREFORE, premises considered, judgment is hereby
rendered confirming the preliminary injunction and
making the same permanent and perpetual-restraining
and enjoining defendant, her agents and/or
representatives and/or persons acting under her control,
direction, instruction and/or supervision, from using,
employing and/or applying, in any manner, form or
means whatsoever, the surname" TOLENTINO."
No pronouncement as to costs, the same having been
waived by the plaintiff.
The third-party complaint is hereby dismissed, without
pronouncement as to costs. (p. 93, Original Record on
Appeal)
The private respondent appealed the decision to the Court of
Appeals raising several issues, among them, the prescription
of the plaintiff's cause of action and the absence of a
monopolistic proprietary right of the plaintiff over the use of
the surname Tolentino.
On June 25, 1975, the Court of Appeals reversed the decision
of the trial court.
The dispositive portion of the decision reads as follows:
IN VIEW WHEREOF, sustaining Error 1, this Court is
constrained to reverse, as it now reverses, judgment
appealed from, complaint is dismissed, with costs. (p. 76,
Petitioner's Brief)
The petitioner filed a motion for reconsideration but the
same was denied in a resolution dated August 29,1975.
Hence, this appeal by the petitioner.
The uncontroverted facts of the case are:
The petitioner is the present legal wife of Arturo Tolentino,
their marriage having been celebrated on April 21, 1945 in
Manila. The union produced three children.
Respondent Consuelo David was legally married to Arturo
Tolentino on February 8, 1931. Their marriage likewise
produced children. The marriage was dissolved and
terminated pursuant to the law during the Japanese
occupation on September 15, 1943 by a decree of absolute
divorce granted by the Court of First Instance of Manila in
Divorce Case No. R-619 entitled "Arturo Tolentino v. Consuelo
David" on the ground of desertion and abandonment by the
wife. The trial court granted the divorce on its finding that
Arturo Tolentino was abandoned by Consuelo David for at
least three (3) continuous years.
Thereafter, Arturo Tolentino married a certain Pilar Adorable,
who however, died soon after their marriage. Tolentino
subsequently married Constancia on April 21, 1945.

Consuelo David, on the other hand, continued using the


surname Tolentino after the divorce and up to the time of the
filing of this complaint.
The third party defendant, in his answer, admitted that the
use of the surname Tolentino by the private respondent was
with his and his family's (brothers and sisters) consent.
The petition mainly revolves around two issues:
1. Whether or not the petitioner's cause of action has
already prescribed, and
2. Whether or not the petitioner can exclude by injunction
Consuelo David from using the surname of her former
husband from whom she was divorced.
The petitioner's contention that her cause of action is
imprescriptible is without merit. In fact, it is contradictory to
her own claim. The petitioner insists that the use by
respondent Consuelo David of the surname Tolentino is a
continuing actionable wrong and states that every use of the
surname constitutes a new crime. The contention cannot be
countenanced because the use of a surname by a divorced
wife for a purpose not criminal in nature is certainly not a
crime. The rule on prescription in civil cases such as the
case at bar is different. Art. 1150 of the Civil Code provides:
"The time for prescription for all kinds of actions, when there
is no special provision which ordains otherwise, shall be
counted from the day they may be brought."
All actions, unless an exception is provided, have a
prescriptive period. Unless the law makes an action
imprescriptible, it is subject to bar by prescription and the
period of prescription is five (5) years from the time the right
of action accrues when no other period is prescribed by law
(Civil Code, Art. 1149). The Civil Code provides for some
rights which are not extinguished by prescription but an
action as in the case before us is not among them. Neither is
there a special law providing for imprescriptibility.
Moreover, the mere fact that the supposed violation of the
petitioner's right may be a continuous one does not change
the principle that the moment the breach of right or duty
occurs, the right of action accrues and the action from that
moment can be legally instituted (Soriano v. Sternberg, 41
Phil. 210).
The respondent Court of Appeals, on the other hand, is of
the opinion that the period of prescription should be four (4)
years, since it appears to be an action based on quasi-delict.
hatever the period, it cannot be denied that the action
has long prescribed whether the cause accrued on April 21,
1945 when the petitioner and Arturo Tolentino got married,
or on August 30, 1950, when the present Civil Code took
effect, or in 1951 when Constancia Tolentino came to know
of the fact that Consuelo David was still using the surname
Tolentino. It is the legal possibility of bringing the action
which detemines the starting point for the computation of
the period of prescription (Espanol v. Phil. Veterans
Administration, 137 SCRA 314).
The petitioner should have brought legal action immediately
against the private respondent after she gained knowledge
of the use by the private respondent of the surname of her
former husband. As it is, action was brought only on
November 23, 1971 with only verbal demands in between
and an action to reconstitute the divorce case. The petitioner
should have filed her complaint at once when it became
evident that the private respondent would not accede to her
demands instead of waiting for twenty (20) years.
As aptly stated by the Court of Appeals, "where the plaintiff
fails to go to the Court within the prescriptive period, he
loses his cause, but not because the defendant had acquired
ownership by adverse possession over his name but because
the plaintiffs cause of action had lapsed thru the statute of
limitations." (p. 37, Rollo)
On the principal issue of whether or not a divorced woman
may continue using the surname of her former husband,

Philippine law is understandably silent. We have no


provisions for divorce in our laws and consequently, the use
of surnames by a divorced wife is not provided for.
There is no merit in the petitioner's claim that to sustain the
private respondent's stand is to contradict Articles 370 and
371 of the Civil Code.
It is significant to note that Senator Tolentino himself in his
commentary on Art. 370 of the Civil Code states that "the
wife cannot claim an exclusive right to use the husband's
surname. She cannot be prevented from using it; but neither
can she restrain others from using it." (Tolentino, Civil Code,
1974 ed., P. 681).
Art. 371 is not applicable to the case at bar because Art. 371
speaks of annulment while the case before us refers to
absolute divorce where there is a severance of valid
marriage ties. The effect of divorce is more akin to the death
of the spouse where the deceased woman continues to be
referred to as the Mrs. of her husband even if the latter has
remarried rather than to annulment since in the latter case,
it is as if there had been no marriage at all.
The private respondent has established that to grant the
injunction to the petitioner would be an act of serious
dislocation to her. She has given proof that she entered into
contracts with third persons, acquired properties and
entered into other legal relations using the surname
Tolentino. The petitioner, on the other hand, has failed to
show that she would suffer any legal injury or deprivation of
legal rights inasmuch as she can use her husband's surname
and be fully protected in case the respondent uses the
surname Tolentino for illegal purposes.
There is no usurpation of the petitioner's name and surname
in this case so that the mere use of the surname Tolentino by
the Private respondent cannot be said to have injured the
petitioner's rights. "The usurpation of name implies some
injury to the interests of the owner of the name. It consists in
the possibility of confusion of Identity ... between the owner
and the usurper. It exists when a person designates himself
by another name ... The following are the elements of
usurpation of a name: 1) there is an actual use of another's
name by the defendant; 2) the use is unauthorized; and 3)
the use of another's name is to designate personality or
Identify a person" (Tolentino, supra, p. 685). None of these
elements exists in the case at bar and neither is there a
claim by the petitioner that the private respondent
impersonated her. In fact, it is of public knowledge that
Constancia Tolentino is the legal wife of Arturo Tolentino so
that all invitations for Senator and Mrs. Tolentino are sent to
Constancia. Consuelo never represented herself after the
divorce as Mrs. Arturo Tolentino but simply as Mrs. Consuelo
David-Tolentino. The private respondent has legitimate
children who have every right to use the surname Tolentino.
She could not possibly be compelled to use the prefix "Miss"
or use the name Mrs. David, different from the surnames of
her children. The records do not show that she has legally
remarried.
In Silva, et al. v. Peralta (110 Phil. 57) cited by the petitioner,
it was not the mere use of the surname that was enjoined
but the defendant's representation that she was the wife of
Saturnino Silva. There was, therefore, a usurpation of the
wife's status which is absent in the case at bar.
We rule that the use of the surname Tolentino does not
impinge on the rights of the petitioner.
Considering the circumstances of this petition, the age of the
respondent who may be seriously prejudiced at this stage of
her life, having to resort to further legal procedures in
reconstituting documents and altering legal transactions
where she used the surname Tolentino, and the effects on
the private respondent who, while still not remarried, will
have to use a surname different from the surnames of her
own children, we find it just and equitable to leave things as
they are, there being no actual legal injury to the petitioner
save a deep hurt to her feelings which is not a basis for
injunctive relief.

WHEREFORE, the petition is hereby DISMISSED for lack of


merit. The decision of the Court of Appeals is AFFIRMED. The
writs of preliminary and mandatory injunction issued by the
trial court are SET ASIDE.
SO ORDERED.
G.R. No. 94986 February 23, 1995
HATIMA C. YASIN, represented by her Attorney-inFact, HADJI HASAN S. CENTI, petitioner,
vs.
THE HONORABLE JUDGE SHARI'A DISTRICT COURT
THIRD SHARI'A JUDICIAL DISTRICT, Zamboanga
City, respondent.
RESOLUTION

BIDIN, J.:
On May 5, 1990, Hatima C. Yasin filed in the Shari'a District
Court in Zamboanga City a "Petition to resume the use of
maiden name" (Sp. Proc. No. 06-3). The petition reads:
1. That she is of legal age, a divorcee, a Muslin Filipino and
a resident of Suterville, Zamboanga City, Philippines, and
is duly represented in this act by her elder brother and
attorney-in-fact, HADJI HASAN S. CENTI by virtue of an
instrument of a Special Power of Attorney, original copy of
which is hereto attached and marked as Annex "A" hereof;
2. That she was formerly married to a certain Hadji Idris
Yasin, also a Muslim Filipino in accordance with Muslim
rites and customs, and who is now residing at Barangay
Recodo, Zamboanga City, but sometime on March 13,
1984, they were granted a decree of divorce by the
Mindanao Islamic Center Foundation, Inc., in accordance
with Islamic Law, the divorce rites was officiated by Ustadz
Sharif Jain Jali as evidenced by his Certification, dated
march 13, 1984, copy of which is hereto attached as
Annex "B" to form an integral part hereof;
3. That, thereafter the former husband Hadji Idris Yasin
contracted another marriage to another woman;
WHEREFORE, invoking the provisions of Article 143, par.
1(c) of Presidential Decree No. 1083 in relation to Article
371 (2) of the New Civil Code, and after due notice and
hearing, it is most respectfully prayed of this Honorable
Court that petitioner be allowed to resume the use of her
maiden name Hatima Centi y Saul.
On July 4, 1990, the respondent court issued an order which
reads as follows:
It patently appearing that the petition filed is not sufficient
in form and substance in accordance with Section 2(a) and
3, Rule 103, Rules of Court, regarding the residence of
petitioner and the name sought to be adopted is not
properly indicated in the title thereof which should include
all the names by which the petitioner has been known (Ng
Yao Siong v. Republic of the Philippines, L-20306, March
31, 1966, 16 SCRA [483]; Go v. Republic of the Philippines,
L-31760, May 25, 1977; Pabellar v. Republic, L-27298,
march 4, 1976), the pleading must be rectified
accordingly.
WHEREFORE, petitioner is hereby ordered to effect the
necessary amendment of the petition within one (1) week
from receipt hereof so as to reflect the formal
requirements adverted to. (Rollo, p. 9)
Hatima filed a motion for reconsideration of the aforesaid
order alleging that the petition filed is not covered by Rule
103 of the Rules of Court but is merely a petition to resume
the use of her maiden name and surname after the
dissolution of her marriage by divorce under the Code of

Muslim Personal Laws of the Philippines (P.D. No. 1083), and


after marriage of her former husband to another woman.
The motion was denied by the respondent court in an order
dated August 10, 1990, on the ground that the petition is
substantially for change of name and that compliance with
the provisions of Rule 103, Rules of Court on change of name
is necessary if the petition is to be granted as it would result
in the resumption of the use of petitioner's maiden name
and surname.
Hence, this petition alleging that respondent court erred in
applying Rule 103 of the Rules of Court to the instant case.
In his Comment dated June 14, 1991, the respondent court,
among others, contends:
5. . . . (R)espondent court is of the honest opinion that the
said petition is substantially one for change of name,
particularly of surname Hatima C. Yasin to Hatima Centi
y Saul, the latter being her maiden name and surname.
Her reasons: The (1) dissolution of her marriage, and (2)
her legal right to resume the use of her maiden name and
surname. In effect, if petition is granted, it will result in the
resumption of the use of her surname.
Moreover, the use of surnames is governed by law (Arts.
364-380, Title XIII, New Civil Code). This is the substantive
requirements. And as to procedural requirements, no
person can change his name or surname without judicial
authority (Art. 376, Civil Code of the Philippines)
(Emphasis supplied). Change of name under judicial
authorization is governed by Rule 103 of the Revised Rules
of Court. Under Sec. 1 of said rule: "a person desiring to
change his name shall present the petition to the Court of
First Instance of the province (now RTC) in which he
resides, or in the City of Manila, to the Juvenile and
Domestic Relations Court." The State has an interest in the
names borne by individual and entities for purposes of
identification. A change of name is a privilege and not a
matter of right. Therefore, before a person can be
authorized to change his name (given him either in his
birth certificate or civil registry), he must show proper or
compelling reason, which may justify such change.
Otherwise, the request should be denied (Ong Peng Oan v.
Republic, 102 Phil. 468) (See: Paras, Civil Code of the
Philippines Annotated, Vol. I, 8th Ed., 1978, pp. 739-740).
(Rollo, pp. 46-47)
The basic issue to be resolved is: whether or not in the case
of annulment of marriage, or divorce under the Code of
Muslim Personal Laws of the Philippines, and the husband is
married again to another woman and the former desires to
resume her maiden name or surname, is she required to file
a petition for change of name and comply with the formal
requirements of Rule 103 of the Rules of Court.
Stated otherwise, the issue is: whether or not a petition for
resumption of maiden name and surname is also a petition
for change of name.
The Court rules in the negative.
The true and real name of a person is that given to him and
entered in the civil register (Chomi v. Local Civil Register of
Manila, 99 Phil. 1004 [1956]; Ng Yao Siong v. Republic, 16
SCRA 483 [1966]; Rendora v. Republic, 35 SCRA 262 [1970];
Pabellar v. Republic, 70 SCRA 16 [1976]).
While it is true that under Article 376 of the Civil Code, no
person can change his name or surname without judicial
authority, nonetheless, the only name that may be changed
is the true and official name recorded in the Civil Register.
Thus, this Court in Ng Yao Siong v. Republic (16 SCRA 483
[1966]), held:
In a proceeding for a change of name the following
question may crop up: What is the name to be changed?
By Article 408 of the Civil Code a person's birth must be
entered in the civil register. So it is, that the civil register
records his name. That name in the civil register, for legal

purposes, is his real name. And correctly so, because the


civil register is an official record of the civil status of
persons. A name given to a person in the church record or
elsewhere or by which he is known in the community
when at variance with that entered in the civil register
is unofficial and cannot be recognized as his real name.
We therefore rule that for the purposes of an application
for change of name under Article 376 of the Civil Code,
the only name that may be changed is the true or official
name recorded in the civil register.
Petitioner's registered name is Hatima Centi Y. Saul. In the
instant petition, petitioner does not seek to change her
registered maiden name but, instead, prays that she be
allowed to resume the use of her maiden name in view of
the dissolution of her marriage to Hadji Idris Yasin, by virtue
of a decree of divorce granted in accordance with Muslim
law.
Divorce (talaq) is defined in PD 1086, the Code of Muslim
Personal Laws of the Philippines, as follows:
Art. 45. Definition and forms. Divorce is the formal
dissolution of the marriage bond in accordance with this
Code to be granted only after exhaustion of all possible
means of reconciliation between the spouses. It may be
effected by:
(a) Repudiation of the wife by the husband (talaq);
xxx xxx xxx
(c) Judicial decree ( faskh).
Divorce (talaq or faskh) severs the marriage bond. Thus,
Article 54 of PD 1086 provides:
Art. 54. Effects of irrevocable talaq or faskh.
A talaq or faskh, as soon as it become irrevocable, shall
have the following effects:
(a) The marriage bond shall be severed and the
spouses may contract another marriage in
accordance with this Code;
The divorce becomes irrevocable after observance of a
period of waiting called idda (Art. 56, PD 1086) the duration
of which is 3 monthly courses after termination of the
marriage by divorce (Art. 57[b], PD 1083). Under Article 187,
PD 1083, the Civil Code of the Philippines, the Rules of Court
and other existing laws, insofar as they are not inconsistent
with the provisions of this Code (the Code of Muslim Personal
Laws), shall be applied suppletorily.
Even under the Civil Code, the use of the husband's surname
during the marriage (Art. 370, Civil Code), after annulment
of the marriage (Art. 371, Civil Code) and after the death of
the husband (Art. 373, Civil Code) is permissive and not
obligatory except in case of legal separation (Art. 372, Civil
Code). Thus, Articles 370 and 371 of the Civil Code provides:
Art. 370. A married woman may use:
(1) Her maiden first name and surname and add her
husband's surname, or
(2) Her maiden first name and her husband's surname,
or
(3) Her husband's full name, but prefixing a word
indicating that she is his wife, such as "Mrs."
Art. 371. In case of annulment of marriage, and the wife
is the guilty party, she shall resume her maiden name
and surname. If she is the innocent spouse, she may
resume her maiden name and surname. However, she
may choose to continue employing her former
husband's surname, unless:

(1) The court decrees otherwise, or


(2) She or the former husband is married again to
another person.
According to Tolentino:
. . . Under the present article of our Code, however, the
word "may" is used, indicating that the use of the
husband's surname by the wife is permissive rather
than obligatory. We have no law which provides that the
wife shall change her name to that of the husband upon
marriage. This is in consonance with the principle that
surnames indicate descent. It seems, therefore, that a
married woman may use only her maiden name and
surname. She has an option, but not a duty, to use the
surname of the husband in any of the ways provided by
this Article. (Tolentino, Civil Code of the Philippines, Vol.
I, p. 724, 1983 ed.)
When a woman marries a man, she need not apply and/or
seek judicial authority to use her husband's name by
prefixing the word "Mrs." before her husband's full name or
by adding her husband's surname to her maiden first name.
The law grants her such right (Art. 370, Civil Code).
Similarly, when the marriage ties or vinculum no longer
exists as in the case of death of the husband or divorce as
authorized by the Muslim Code, the widow or divorcee need
not seek judicial confirmation of the change in her civil
status in order to revert to her maiden name as the use of
her former husband's name is optional and not obligatory for
her (Tolentino, Civil Code, p. 725, 1983 ed.; Art. 373, Civil
Code). When petitioner married her husband, she did not
change her name but only her civil status. Neither was she
required to secure judicial authority to use the surname of
her husband after the marriage as no law requires it.
In view of the foregoing considerations, We find the petition
to resume the use of maiden name filed by petitioner before
the respondent court a superfluity and unnecessary
proceeding since the law requires her to do so as her former
husband is already married to another woman after
obtaining a decree of divorce from her in accordance with
Muslim laws.
Although there is no legal prohibition against obtaining a
judicial confirmation of a legal right, nevertheless, no law or
rule provides for the procedure by which such confirmation
may be obtained. In view of such circumstances, the
onerous requirements of Rule 103 of the Rules of Court on
change of name should not be applied to judicial
confirmation of the right of a divorced woman to resume her
maiden name and surname. In the absence of a specific rule
or provision governing such a proceeding, where sufficient
facts have been alleged supported by competent proof as
annexes, which appear to be satisfactory to the court, such
petition for confirmation of change of civil status and/or to
resume the use of maiden name must be given due course
and summarily granted as in fact it is a right conferred by
law.
While the petition filed in the instant case leaves much to be
desired in matters of form and averment of concise
statements of ultimate facts constituting the petitioner's
cause of action, nevertheless, giving it a most liberal
construction, the petition suffices to convey the petitioner's
desire and prayer to resume her maiden surname on
grounds of her divorce from her former husband and
subsequent marriage of the latter to another woman.
The remand of this case to the trial court would only delay
the final disposition of this case and would not serve the
public interest. We have consistently ruled that the remand
of the case to a lower court for further reception of evidence
is not necessary if this Court can already resolve the dispute
on the basis of the records before it (Dimayuga v. PCIB, 200
SCRA 143 [1991]; Board of Liquidators v. Zulueta, 115 SCRA
548 [1982]: Quisumbing v. CA, 120 SCRA 703 [1983]).
WHEREFORE, the petition is GRANTED and the orders of
respondent court dated July 4, 1990 and August 10, 1990

are hereby SET ASIDE. Petitioner is authorized to resume her


maiden name and surname.
SO ORDERED.

G.R. No. L-14874

September 30, 1960

ANTONIO PEREZ, in his own representation and as


Guardian Ad litem of his son BENIGNO PEREZ Y
TUASON, plaintiff-appellant,
vs.
ANGELA TUASON DE PEREZ, defendant and appellee.
Alfonso Felix Jr. for appellant.
Jose W. Diokno for appellee.
REYES, J.B.L., J.:
Appeal from an order, dated October 27, 1958, of the Court
of First Instance of Manila, dismissing its Civil Case No.
34626 for lack of jurisdiction.
Plaintiff Antonio Perez, in his own representation and as
guardian ad litem of his adoptive son, Benigno Perez y
Tuason, initiated this civil case against Angela Tuason de
Perez, the plaintiff's wife and Benigno's mother. The
complaint states three causes of action.
Under the first causes of action, it is averred that the
defendant is squandering all of her estate on a young man
by the name of Jose Antonio Campos Boloix, because of
which Benigno Perez y Tuason, acting through his
guardian ad litem, the plaintiff, prays that his mother, the
defendant, be declared a prodigal and placed under
appointed to administer her properties; and that during the
pendency of this suit, a writ of injunction be issued to
prevent the continued waste and disposition of her
properties.
In his second cause of action, the husband Antonio Perez, for
and his own behalf, asserts that by virtue of the said alleged
acts of prodigality committed by the defendant wife, the
conjugal partnership of gain is being dissipated to the
prejudice of both spouses; wherefore, he prays for a writ of
injunction to restrain her from "dissolving and liquidating the
conjugal partnership of gains."
Finally, as third case of action, the plaintiff husband avers
that, in addition to the aforementioned acts, the defendants
had repeatedly advised him, as well as other persons, that
she intends to marry Jose Campos Boloix and to have a child
by him not withstanding her present marriage to the
plaintiff, Antonio Perez; and that, if she could not have such
a child, she was willing to have one by any other person, just
to put plaintiff in a ridiculous and embarrassing position.
Plaintiff, therefore, seeks to recover from her the total sum
of P185,000.00 by way of damages and attorney's fees.
On January 2, 1958, after a preliminary hearing, wherein
plaintiff was heard ex parte, the Court of First Instance of
Manila issued a preliminary injunction as prayed for in
complaint.
On March 19, 1958, the defendant appeared through
counsel and prayed for the dismissal of the case on the
ground of res judicata, and that the preliminary injunction be
dissolve. Said motion was denied by the court a quoin its
order of April 2, 1958.
On April 16, 1958, the defendant filed a second motion to
dismiss the case, this time on the ground that the Court of
First Instance of Manila had no jurisdiction over the present
proceedings, which, according to her, is vested under
Republic Act No. 1401 with the Juvenile and Domestic
Relations Court. While this last motion was being considered
by the Court, a compromise agreement was arrived at and
submitted for approval of the court on May 2, 1958. On May
31, 1958, before the Court could act, defendant filed an
opposition to the approval of the compromise agreement, on
the ground that (a) the same is contrary to law and (b) it
was not freely or validly entered into by her representative.
Without resolving this particular question, the lower court
asked the parties to submit further memoranda on the sole
issue of jurisdiction. After this was done, the trial court, by
order of September 30, 1958, ordered the dismissal of the

case on the ground that it lacked jurisdiction over the


subject matter. Hence, plaintiffs Perez (father and son)
appealed.
Appellants assign three alleged errors in the order appealed
from, as follows:
The trial court erred in holding that the Court of First
Instance of Manila has no jurisdiction over the causes of
action alleged by Antonio Perez in the complaint.
The trial court erred in holding that the Court of First
Instance of Manila has no jurisdiction over the causes of
action alleged by Benigno Perez y Tuason in the complaint.
The trial court erred in holding that the Doctrine of
Estoppel of Jurisdiction is not applicable in this country
and erred further in failing to apply said doctrine to the
present proceedings.
We find the appeal to be untenable.
Republic Act no. 1401, creating the Juvenile Domestic
Relations Court of the City of Manila and defining its
jurisdiction, provides, among other things, that:
SEC. 38AProvision of the Judiciary Act to the contrary
notwithstanding, the court shall have exclusive original
jurisdiction to hear and decide the following cases after
the effectivity of this Act:
(b) Cases involving custody, guardianship, adoption,
paternity and acknowledgment;
xxx

xxx

xxx

(d) proceedings brought under the provisions of


Articles one hundred sixteen, two hundred twenty-five,
two hundred fifty, two and three hundred thirty-one of
the Civil Code. (Emphasis supplied.)
While Article 116 of the Civil Code (referred to in subsection
[d] above) states:.
When one of the spouses neglects his or her duties to the
conjugal union or brings danger, dishonor or material
injury upon the other, the injured party may apply to the
court for relief.
The court may counsel the offended party to comply with
his or her duties, and take such measures as may be
proper. (Emphasis supplied.)1awphl.nt
It is easy to see that the first cause of action set forth in the
complaint, wherein the minor Benigno Perez y Tuason,
through his representative, ask his mother be placed under
guardianship because of her alleged prodigality, and prays
that a suitable person or institution be appointed to
administer her properties, is exclusively cognizable by the
Domestic Relations Court. The action falls squarely under the
provisions of subsection (b), Section 38-A, R.A. 1401, abovequoted, as a "case involving . guardianship." No error was,
therefore, committed in the appealed order in holding that
this cause of action lay outside the jurisdiction of the Court
of First Instance.
The same thing can be said of the third cause of action
wherein Antonio Perez seeks to recover damages and
attorney's fees because his wife's act (avowing openly her
intention to marry and have a child by Campos Boloix or if
not, by anyone else) placed the plaintiff "in an embarrassing
and contemptible position" (sic) and causing him "grave
anxiety, wounded feelings, extreme humiliation." The case
involves acts of a spouse that "brings . . .dishonor . . . upon
the other (spouse)" under Article 116 of the Civil Code of the
Philippines, and also lies within the jurisdiction of the
Domestic Relations Court. The law (subsection (d), Sec. 38A) expressly gives that courtexclusive original jurisdiction

over proceedings under the provisions of Article 116 of the


Civil Code.

Fisher & DeWitt for appellant.


Powell & Hill for appellee.

More controversial is the issue involved in the second cause


of action of the complaint, wherein Antonio Perez alleges
that the prodigal acts of his wife result in the conjugal
partnership of gains being dissipated to the prejudice of both
spouses, and prays for a writ of injunction to restrain her
from "dissolving and liquidating the conjugal partnership of
gains." The Court of First Instance held that this cause of
action is also one of those provided by Article 116 of the
Civil Code, as a case where one spouse "bring danger . . .
or material injury" upon the other, and, therefore, relief
should be sought in the Court of Domestic Relations.

STREET, J.:

We are inclined to think that "material injury" as used in


Article 116 does not refer to patrimonial (economic) injury or
damage, but to personal (i. e. physical or moral) injury to
one of the spouses, since Article 116 lies in the chapter
concerning personal relations between husband and wife.
Nevertheless, the court below was correct in viewing this
cause of action as primarily predicated on the grant of
guardianship due to alleged prodigality of the wife, sine the
allegation thereof is therein reiterated, and the remedy of
injunction sought against further (i. e. future) acts of
disposition (no annulment of her past transactions is
demanded) must be necessarily based on the wife's being
subject to guardianship.
If the wife were not in any way incapacitated, the mere fact
that the alienation of her paraphernal would deprive the
conjugal partnership of the future fruits thereof would not
give rise to a cause of action for injunction, since the
conjugal partnership is only entitled to the net fruits of such
property, after deducting administration expenses (People's
Bank vs. Register of Deeds, 60 Phil., 167), and it is nowhere
alleged that any such net fruits exist. More fundamental still,
the wife's statutory power to alienate her paraphernal (Phil
Civil Code, Article 140) necessarily implies power to alienate
its future fruits, since the latter are mere accessory to the
property itself.
WHEREFORE, the second cause of action is inextricably
woven into and cannot stand independently of the demand
for guardianship of the wife, injunction being a mere incident
thereof; so that like the first cause of action, the second also
lay within the exclusive jurisdiction of the Court of Domestic
Relations.
The third alleged error charged against the Court below, that
it should have that defendant was in estoppel to question
the jurisdiction of the trial court is, on its face, without merit.
Assuming for the sake of argument that defendant appellee
was placed in such estoppel by merely executing the
compromise and submitting it to the Court's approval, such
estoppel could not operate against the Court. Regardless of
the parties, the Court, at any time, could motu
proprio inquire and determine whether it had jurisdiction
over the subject matter of the action, and could dismiss the
case (as it did) if it found that it had no power to act therein.
The order appealed from is hereby affirmed. Costs against
appellants.

G.R. No. L-17014

August 11, 1921

MARIANO B. ARROYO, plaintiff-appellant,


vs.
DOLORES C. VASQUEZ DE ARROYO, defendant-appellee.

Mariano B. Arroyo and Dolores C. Vasquez de Arroyo were


united in the bonds of wedlock by marriage in the year 1910,
and since that date, with a few short intervals of separation,
they have lived together as man and wife in the city of Iloilo
until July 4, 1920, when the wife went away from their
common home with the intention of living thenceforth
separate from her husband. After efforts had been made by
the husband without avail to induce her to resume marital
relations, this action was initiated by him to compel her to
return to the matrimonial home and live with him as a dutiful
wife. The defendant answered, admitting the fact of
marriage, and that she had left her husband's home without
his consent; but she averred by way of defense and crosscomplaint that she had been compelled to leave by cruel
treatment on the part of her husband. Accordingly she in
turn prayed for affirmative relief, to consist of (1) a decree of
separation; (2) a liquidation of the conjugal partnership; (3)
and an allowance for counsel fees and permanent separate
maintenance. Upon hearing the cause the lower court gave
judgment in favor of the defendant, authorizing her to live
apart from her husband, granting her alimony at the rate of
P400 per month, and directing that the plaintiff should pay
to the defendant's attorney the sum of P1,000 for his
services to defendant in the trial of the case. The plaintiff
thereupon removed the case with the usual formalities by
appeal to this court.
The trial judge, upon consideration of the evidence before
him, reached the conclusion that the husband was more to
blame than his wife and that his continued ill-treatment of
her furnished sufficient justification for her abandonment of
the conjugal home and the permanent breaking off of
marital relations with him. We have carefully examined and
weighed every line of the proof, and are of the opinion that
the conclusion stated is wholly untenable. The evidence
shows that the wife is afflicted with a disposition of jealousy
towards her husband in an aggravated degree; and to his
cause are chiefly traceable without a doubt the many
miseries that have attended their married life. In view of the
decision which we are to pronounce nothing will be said in
this opinion which will make the resumption of married
relations more difficult to them or serve as a reminder to
either of the mistakes of the past; and we prefer to record
the fact that so far as the proof in this record shows neither
of the spouses has at any time been guilty of conjugal
infidelity, or has given just cause to the other to suspect
illicit relations with any person. The tales of cruelty on the
part of the husband towards the wife, which are the basis of
the cross-action, are in our opinion no more than highly
colored versions of personal wrangles in which the spouses
have allowed themselves from time to time to become
involved and would have little significance apart from the
morbid condition exhibited by the wife. The judgment must
therefore be recorded that the abandonment by her of the
marital home was without sufficient justification in fact.
In examining the legal questions involved, it will be found
convenient to dispose first of the defendant's crosscomplaint. To begin with, the obligation which the law
imposes on the husband to maintain the wife is a duty
universally recognized in civil society and is clearly
expressed in articles 142 and 143 of the Civil code. The
enforcement of this obligation by the wife against the
husband is not conditioned upon the procurance of a divorce
by her, nor even upon the existence of a cause for divorce.
Accordingly it had been determined that where the wife is
forced to leave the matrimonial abode and to live apart from
her husband, she can, in this jurisdiction, compel him to
make provision for her separate maintenance
(Goitia vs. Campos Rueda, 35 Phil., 252); and he may be
required to pay the expenses, including attorney's fees,
necessarily incurred in enforcing such obligation,
(Mercado vs. Ostrand and Ruiz, 37 Phil., 179.) Nevertheless,
the interests of both parties as well as of society at large
require that the courts should move with caution in
enforcing the duty to provide for the separate maintenance
of the wife, for this step involves a recognition of the de
facto separation of the spouses a state which is abnormal
and fraught with grave danger to all concerned. From this

consideration it follows that provision should not be made


for separate maintenance in favor of the wife unless it
appears that the continued cohabitation of the pair has
become impossible and separation necessary from the fault
of the husband.
In Davidson vs Davidson, the Supreme Court of Michigan,
speaking through the eminent jurist, Judge Thomas M.
Cooley, held that an action for the support of the wife
separate from the husband will only be sustained when the
reasons for it are imperative (47 Mich., 151). That imperative
necessity is the only ground on which such a proceeding can
be maintained also appears from the decision in
Schindel vs. Schindel (12 Md., 294). In the State of South
Carolina, where judicial divorces have never been procurable
on any ground, the Supreme court fully recognizes the right
of the wife to have provision for separate maintenance,
where it is impossible for her to continue safely to cohabit
with her husband; but the same court has more than once
rejected the petition of the wife for separate maintenance
where it appeared that the husband's alleged cruelty or illtreatment was provoked by the wife's own improper
conduct. (Rhame vs. Rhame, 1 McCord's Chan. [S. Car.], 197;
16 Am. Dec., 597; Boyd vs. Boyd, Har. Eq. [S. Car.], 144.)
Upon one occasion Sir William Scott, pronouncing the
judgment of the English Ecclesiastical Court in a case where
cruelty on the part of the husband was relied upon to secure
a divorce for the wife, made use of the following eloquent
words, which are perhaps even more applicable in a
proceeding for separate maintenance in a jurisdiction where,
as here, a divorce cannot be obtained except on the single
ground of adultery and this, too, after the conviction of the
guilty spouse in a criminal prosecution for that crime. Said
he:
That the duty of cohabitation is released by the cruelty of
one of the parties is admitted, but the question occurs,
What is cruelty? . . .
What merely wounds the mental feelings is in few cases to
be admitted where they are not accompanied with bodily
injury, either actual or menaced. Mere austerity of temper,
petulance of manners, rudeness of language, a want of
civil attention and accommodation, even occasional sallies
of passion, if they do not threaten bodily harm, do not
amount to legal cruelty: they are high moral offenses in
the marriage-state undoubtedly, not innocent surely in
any state of life, but still they are not that cruelty against
which the law can relieve. Under such misconduct of
either of the parties, for it may exist on the one side as
well as on the other, the suffering party must bear in
some degree the consequences of an injudicious
connection; must subdue by decent resistance or by
prudent conciliation; and if this cannot be done, both must
suffer in silence. . . .
The humanity of the court has been loudly and repeatedly
invoked. Humanity is the second virtue of courts, but
undoubtedly the first is justice. If it were a question of
humanity simply, and of humanity which confined its
views merely to the happiness of the present parties, it
would be a question easily decided upon first impressions.
Every body must feel a wish to sever those who wish to
live separate from each other, who cannot live together
with any degree of harmony, and consequently with any
degree of happiness; but my situation does not allow me
to indulge the feelings, much less the first feelings of an
individual. The law has said that married persons shall not
be legally separated upon the mere disinclination of one
or both to cohabit together. . . .
To vindicate the policy of the law is no necessary part of
the office of a judge; but if it were, it would not be difficult
to show that the law in this respect has acted with its
usual wisdom and humanity with that true wisdom, and
that real humanity, that regards the general interests of
mankind. For though in particular cases the repugnance of
the law to dissolve the obligations of matrimonial
cohabitation may operate with great severity upon
individual, yet it must be carefully remembered that the
general happiness of the married life is secured by its
indissolubility. When people understand that they must

live together, except for a very few reasons known to the


law, they learn to soften by mutual accommodation that
yoke which they know cannot shake off; they become
good husbands and good wives form the necessity of
remaining husbands and wives; for necessity is a powerful
master in teaching the duties which it imposes. . . . In this
case, as in many others, the happiness of some
individuals must be sacrificed to the greater and more
general good. (Evans vs. Evans, 1 Hag. Con., 35; 161 Eng.
Reprint, 466, 467.)
In the light of the considerations stated, it is obvious that the
cross-complaint is not well founded and none of the relief
sought therein can be granted.
The same considerations that require the dismissal of the
cross-complaint conclusively prove that the plaintiff, Mariano
B. Arroyo, has done nothing to forfeit his right to the marital
society of his wife and that she is under an obligation, both
moral and legal, to return to the common home and cohabit
with him. The only question which here arises is as to the
character and extent of the relief which may be properly
conceded to him by judicial decree.
The action is one by which the plaintiff seeks the restitution
of conjugal rights; and it is supposed in the petitory part of
the complaint that he is entitled to a permanent mandatory
injunction requiring the defendant to return to the conjugal
home and live with him as a wife according to the precepts
of law and morality. Of course if such a decree were entered,
in unqualified terms, the defendant would be liable to
attachment for contempt, in case she should refuse to obey
it; and, so far as the present writer is aware, the question is
raised for the first time in this jurisdiction whether it is
competent for the court to make such an order.
Upon examination of the authorities we are convinced that it
is not within the province of the courts of this country to
attempt to compel one of the spouses to cohabit with, and
render conjugal rights to, the other. Of course where the
property rights of one of the pair are invaled, an action for
restitution of such rights can be maintained. But we are
disinclined to sanction the doctrine that an order, enforcible
by process of contempt, may be entered to compel the
restitution of the purely personal rights of consortium. At
best such an order can be effective for no other purpose
than to compel the spouses to live under the same roof; and
the experience of these countries where the court of justice
have assumed to compel the cohabitation of married people
shows that the policy of the practice is extremely
questionable. Thus in England, formerly the Ecclesiastical
Court entertained suits for the restitution of conjugal rights
at the instance of either husband or wife; and if the facts
were found to warrant it that court would make a mandatory
decree, enforcible by process of contempt in case of
disobedience, requiring the delinquent party to live with the
other and render conjugal rights. Yet this practice was
sometimes criticized even by the judges who felt bound to
enforce such orders, and in Weldon vs. Weldon (9 P. D., 52),
decided in 1883, Sir James Hannen, President in the Probate,
Divorce and Admiralty Division of the High Court of Justice,
expressed his regret that the English law on the subject was
not the same as that which prevailed in Scotland, where a
decree of adherence, equivalent to the decree for the
restitution of conjugal rights in England, could be obtained
by the injured spouse, but could not be enforced by
imprisonment. Accordingly, in obedience to the growing
sentiment against the practice, the Matrimonial Causes Act
(1884) abolished the remedy of imprisonment; though a
decree for the restitution of conjugal rights can still be
procured, and in case of disobedience may serve in
appropriate cases as the basis of an order for the periodical
payment of a stipend in the character of alimony.
In the voluminous jurisprudence of the United States, only
one court, so far as we can discover, has ever attempted to
make a peremptory order requiring one of the spouses to
live with the other; and that was in a case where a wife was
ordered to follow and live with her husband, who had
changed his domicile to the City of New Orleans. The
decision referred to (Gahn vs. Darby, 36 La. Ann., 70) was
based on a provision of the Civil Code of Louisiana similar to
article 56 of the Spanish Civil Code. It was decided many
years ago, and the doctrine evidently has not been fruitful

even in the State of Louisiana. In other states of the


American Union the idea of enforcing cohabitation by
process of contempt is rejected. (21 Cyc., 1148.)
In a decision of January 2, 1909, the supreme court of Spain
appears to have affirmed an order of the Audencia Territorial
de Valladolid requiring a wife to return to the marital
domicile, and in the alternative, upon her failure to do so, to
make a particular disposition of certain money and effects
then in her possession and to deliver to her husband, as
administrator of the ganancial property, all income, rents,
and interest which might accrue to her from the property
which she had brought to the marriage. (113 Jur. Civ., pp. 1,
11.) but it does not appear that this order for the return of
the wife to the marital domicile was sanctioned by any other
penalty than the consequences that would be visited upon
her in respect to the use and control of her property; and it
does not appear that her disobedience to that order would
necessarily have been followed by imprisonment for
contempt.
We are therefore unable to hold that Mariano B. Arroyo in
this case is entitled to the unconditional and absolute order
for the return of the wife to the marital domicile, which is
sought in the petitory part of the complaint; though he is,
without doubt, entitled to a judicial declaration that his wife
has presented herself without sufficient cause and that it is
her duty to return.
Therefore, reversing the judgment appealed from, in respect
both to the original complaint and the cross-bill, it is
declared that Dolores Vasquez de Arroyo has absented
herself from the marital home without sufficient cause; and
she is admonished that it is her duty to return. The plaintiff
is absolved from the cross-complaint, without special
pronouncement as to costs of either instance. So ordered.

G.R. No. L-11622

January 28, 1961

THE COLLECTOR OF INTERNAL REVENUE, petitioner,


vs.
DOUGLAS FISHER AND BETTINA FISHER, and the
COURT OF TAX APPEALS, respondents.
x---------------------------------------------------------x
G.R. No. L-11668

of the stock obtaining at the San Francisco California) Stock


Exchange six months from the death of Stevenson, that is,
As of August 22, 1931. In addition, the ancillary
administrator made claim for the following deductions:
P2,086.5
2

Funeral expenses ($1,04326)

January 28, 1961.

DOUGLAS FISHER AND BETTINA FISHER, petitioner,


vs.
THE COLLECTOR OF INTERNAL REVENUE, and the
COURT OF TAX APPEALS, respondents.
BARRERA, J.:
This case relates to the determination and settlement of the
hereditary estate left by the deceased Walter G. Stevenson,
and the laws applicable thereto. Walter G. Stevenson (born
in the Philippines on August 9, 1874 of British parents and
married in the City of Manila on January 23, 1909 to Beatrice
Mauricia Stevenson another British subject) died on February
22, 1951 in San Francisco, California, U.S.A. whereto he and
Gross Estate
Real Property 2 parcels of land in
Baguio, covered by T.C.T. Nos. 378 and
379

(2) 210,000 shares of stock of Mindanao


Mother Lode Mines, Inc. at P0.38 per share

(a) Administrator's Fee

P1,204.3
4

(b) Attorney's Fee

6.000.00

(c) Judicial and


Administration expenses
as of August 9, 1952

1,400.05
8,604.39

Real Estate Tax for 1951


on Baguio real properties
(O.R. No. B-1 686836)
P43,500.00

Personal Property
(1) 177 shares of stock of Canacao Estate
at P10.00 each

Judicial Expenses:

1,770.00

Claims against the


estate:
($5,000.00) P10,000.00

652.50

P10,000.
00

Plus: 4% int. p.a. from


Feb. 2 to 22, 1951

79,800.00
Sub-Total

(3) Cash credit with Canacao Estate Inc.


(4) Cash, with the Chartered Bank of India,
Australia & China

Total Gross Assets

4,870.88

851.97
P130,792.8
5

his wife moved and established their permanent residence


since May 10, 1945. In his will executed in San Francisco on
May 22, 1947, and which was duly probated in the Superior
Court of California on April 11, 1951, Stevenson instituted
his wife Beatrice as his sole heiress to the following real and
personal properties acquired by the spouses while residing
in the Philippines, described and preliminary assessed as
follows:
On May 22, 1951, ancillary administration proceedings were
instituted in the Court of First Instance of Manila for the
settlement of the estate in the Philippines. In due time
Stevenson's will was duly admitted to probate by our court
and Ian Murray Statt was appointed ancillary administrator
of the estate, who on July 11, 1951, filed a preliminary
estate and inheritance tax return with the reservation of
having the properties declared therein finally appraised at
their values six months after the death of Stevenson.
Preliminary return was made by the ancillary administrator
in order to secure the waiver of the Collector of Internal
Revenue on the inheritance tax due on the 210,000 shares
of stock in the Mindanao Mother Lode Mines Inc. which the
estate then desired to dispose in the United States. Acting
upon said return, the Collector of Internal Revenue accepted
the valuation of the personal properties declared therein, but
increased the appraisal of the two parcels of land located in
Baguio City by fixing their fair market value in the amount of
P52.200.00, instead of P43,500.00. After allowing the
deductions claimed by the ancillary administrator for funeral
expenses in the amount of P2,000.00 and for judicial and
administration expenses in the sum of P5,500.00, the
Collector assessed the state the amount of P5,147.98 for
estate tax and P10,875,26 or inheritance tax, or a total of
P16,023.23. Both of these assessments were paid by the
estate on June 6, 1952.
On September 27, 1952, the ancillary administrator filed in
amended estate and inheritance tax return in pursuance f
his reservation made at the time of filing of the preliminary
return and for the purpose of availing of the right granted by
section 91 of the National Internal Revenue Code.
In this amended return the valuation of the 210,000 shares
of stock in the Mindanao Mother Lode Mines, Inc. was
reduced from 0.38 per share, as originally declared, to P0.20
per share, or from a total valuation of P79,800.00 to
P42,000.00. This change in price per share of stock was
based by the ancillary administrator on the market notation

22.47

10,022.4
7
P21,365.
88

In the meantime, on December 1, 1952, Beatrice Mauricia


Stevenson assigned all her rights and interests in the estate
to the spouses, Douglas and Bettina Fisher, respondents
herein.
On September 7, 1953, the ancillary administrator filed a
second amended estate and inheritance tax return (Exh. "MN"). This return declared the same assets of the estate
stated in the amended return of September 22, 1952, except
that it contained new claims for additional exemption and
deduction to wit: (1) deduction in the amount of P4,000.00
from the gross estate of the decedent as provided for in
Section 861 (4) of the U.S. Federal Internal Revenue Code
which the ancillary administrator averred was allowable by
way of the reciprocity granted by Section 122 of the National
Internal Revenue Code, as then held by the Board of Tax
Appeals in case No. 71 entitled "Housman vs. Collector,"
August 14, 1952; and (2) exemption from the imposition of
estate and inheritance taxes on the 210,000 shares of stock
in the Mindanao Mother Lode Mines, Inc. also pursuant to the
reciprocity proviso of Section 122 of the National Internal
Revenue Code. In this last return, the estate claimed that it
was liable only for the amount of P525.34 for estate tax and
P238.06 for inheritance tax and that, as a consequence, it
had overpaid the government. The refund of the amount of
P15,259.83, allegedly overpaid, was accordingly requested
by the estate. The Collector denied the claim. For this
reason, action was commenced in the Court of First Instance
of Manila by respondents, as assignees of Beatrice Mauricia
Stevenson, for the recovery of said amount. Pursuant to
Republic Act No. 1125, the case was forwarded to the Court
of Tax Appeals which court, after hearing, rendered decision
the dispositive portion of which reads as follows:
In fine, we are of the opinion and so hold that: (a) the
one-half () share of the surviving spouse in the conjugal
partnership property as diminished by the obligations
properly chargeable to such property should be deducted
from the net estate of the deceased Walter G. Stevenson,
pursuant to Section 89-C of the National Internal Revenue
Code; (b) the intangible personal property belonging to
the estate of said Stevenson is exempt from inheritance
tax, pursuant to the provision of section 122 of the
National Internal Revenue Code in relation to the
California Inheritance Tax Law but decedent's estate is
not entitled to an exemption of P4,000.00 in the
computation of the estate tax; (c) for purposes of estate
and inheritance taxation the Baguio real estate of the
spouses should be valued at P52,200.00, and 210,000
shares of stock in the Mindanao Mother Lode Mines, Inc.
should be appraised at P0.38 per share; and (d) the
estate shall be entitled to a deduction of P2,000.00 for
funeral expenses and judicial expenses of P8,604.39.
From this decision, both parties appealed.

The Collector of Internal Revenue, hereinafter called


petitioner assigned four errors allegedly committed by the
trial court, while the assignees, Douglas and Bettina Fisher
hereinafter called respondents, made six assignments of
error. Together, the assigned errors raise the following main
issues for resolution by this Court:
(1) Whether or not, in determining the taxable net estate of
the decedent, one-half () of the net estate should be
deducted therefrom as the share of tile surviving spouse in
accordance with our law on conjugal partnership and in
relation to section 89 (c) of the National Internal revenue
Code;
(2) Whether or not the estate can avail itself of the
reciprocity proviso embodied in Section 122 of the National
Internal Revenue Code granting exemption from the
payment of estate and inheritance taxes on the 210,000
shares of stock in the Mindanao Mother Lode Mines Inc.;
(3) Whether or not the estate is entitled to the deduction of
P4,000.00 allowed by Section 861, U.S. Internal Revenue
Code in relation to section 122 of the National Internal
Revenue Code;
(4) Whether or not the real estate properties of the decedent
located in Baguio City and the 210,000 shares of stock in the
Mindanao Mother Lode Mines, Inc., were correctly appraised
by the lower court;
(5) Whether or not the estate is entitled to the following
deductions: P8,604.39 for judicial and administration
expenses; P2,086.52 for funeral expenses; P652.50 for real
estate taxes; and P10,0,22.47 representing the amount of
indebtedness allegedly incurred by the decedent during his
lifetime; and
(6) Whether or not the estate is entitled to the payment of
interest on the amount it claims to have overpaid the
government and to be refundable to it.
In deciding the first issue, the lower court applied a wellknown doctrine in our civil law that in the absence of any
ante-nuptial agreement, the contracting parties are
presumed to have adopted the system of conjugal
partnership as to the properties acquired during their
marriage. The application of this doctrine to the instant case
is being disputed, however, by petitioner Collector of
Internal Revenue, who contends that pursuant to Article 124
of the New Civil Code, the property relation of the spouses
Stevensons ought not to be determined by the Philippine
law, but by the national law of the decedent husband, in this
case, the law of England. It is alleged by petitioner that
English laws do not recognize legal partnership between
spouses, and that what obtains in that jurisdiction is another
regime of property relation, wherein all properties acquired
during the marriage pertain and belong Exclusively to the
husband. In further support of his stand, petitioner cites
Article 16 of the New Civil Code (Art. 10 of the old) to the
effect that in testate and intestate proceedings, the amount
of successional rights, among others, is to be determined by
the national law of the decedent.
In this connection, let it be noted that since the mariage of
the Stevensons in the Philippines took place in 1909, the
applicable law is Article 1325 of the old Civil Code and not
Article 124 of the New Civil Code which became effective
only in 1950. It is true that both articles adhere to the socalled nationality theory of determining the property relation
of spouses where one of them is a foreigner and they have
made no prior agreement as to the administration
disposition, and ownership of their conjugal properties. In
such a case, the national law of the husband becomes the
dominant law in determining the property relation of the
spouses. There is, however, a difference between the two
articles in that Article 1241 of the new Civil Code expressly
provides that it shall be applicable regardless of whether the
marriage was celebrated in the Philippines or abroad while
Article 13252 of the old Civil Code is limited to marriages
contracted in a foreign land.
It must be noted, however, that what has just been said
refers to mixed marriages between a Filipino citizen and a
foreigner. In the instant case, both spouses are foreigners
who married in the Philippines. Manresa,3 in his
Commentaries, has this to say on this point:
La regla establecida en el art. 1.315, se refiere a las
capitulaciones otorgadas en Espana y entre espanoles. El
1.325, a las celebradas en el extranjero cuando alguno de
los conyuges es espanol. En cuanto a la regla procedente
cuando dos extranjeros se casan en Espana, o dos
espanoles en el extranjero hay que atender en el primer
caso a la legislacion de pais a que aquellos pertenezean, y
en el segundo, a las reglas generales consignadas en los
articulos 9 y 10 de nuestro Codigo. (Emphasis supplied.)
If we adopt the view of Manresa, the law determinative of
the property relation of the Stevensons, married in 1909,

would be the English law even if the marriage was


celebrated in the Philippines, both of them being foreigners.
But, as correctly observed by the Tax Court, the pertinent
English law that allegedly vests in the decedent husband full
ownership of the properties acquired during the marriage
has not been proven by petitioner. Except for a mere
allegation in his answer, which is not sufficient, the record is
bereft of any evidence as to what English law says on the
matter. In the absence of proof, the Court is justified,
therefore, in indulging in what Wharton calls "processual
presumption," in presuming that the law of England on this
matter is the same as our law.4
Nor do we believe petitioner can make use of Article 16 of
the New Civil Code (art. 10, old Civil Code) to bolster his
stand. A reading of Article 10 of the old Civil Code, which
incidentally is the one applicable, shows that it does not
encompass or contemplate to govern the question of
property relation between spouses. Said article distinctly
speaks of amount of successional rights and this term, in
speaks in our opinion, properly refers to the extent or
amount of property that each heir is legally entitled to
inherit from the estate available for distribution. It needs to
be pointed out that the property relation of spouses, as
distinguished from their successional rights, is governed
differently by the specific and express provisions of Title VI,
Chapter I of our new Civil Code (Title III, Chapter I of the old
Civil Code.) We, therefore, find that the lower court correctly
deducted the half of the conjugal property in determining
the hereditary estate left by the deceased Stevenson.
On the second issue, petitioner disputes the action of the
Tax Court in the exempting the respondents from paying
inheritance tax on the 210,000 shares of stock in the
Mindanao Mother Lode Mines, Inc. in virtue of the reciprocity
proviso of Section 122 of the National Internal Revenue
Code, in relation to Section 13851 of the California Revenue
and Taxation Code, on the ground that: (1) the said proviso
of the California Revenue and Taxation Code has not been
duly proven by the respondents; (2) the reciprocity
exemptions granted by section 122 of the National Internal
Revenue Code can only be availed of by residents of foreign
countries and not of residents of a state in the United States;
and (3) there is no "total" reciprocity between the Philippines
and the state of California in that while the former exempts
payment of both estate and inheritance taxes on intangible
personal properties, the latter only exempts the payment of
inheritance tax..
To prove the pertinent California law, Attorney Allison Gibbs,
counsel for herein respondents, testified that as an active
member of the California Bar since 1931, he is familiar with
the revenue and taxation laws of the State of California.
When asked by the lower court to state the pertinent
California law as regards exemption of intangible personal
properties, the witness cited article 4, section 13851 (a) and
(b) of the California Internal and Revenue Code as published
in Derring's California Code, a publication of the BancroftWhitney Company inc. And as part of his testimony, a full
quotation of the cited section was offered in evidence as
Exhibits "V-2" by the respondents.
It is well-settled that foreign laws do not prove themselves in
our jurisdiction and our courts are not authorized to take
judicial notice of them.5 Like any other fact, they must be
alleged and proved.6
Section 41, Rule 123 of our Rules of Court prescribes the
manner of proving foreign laws before our tribunals.
However, although we believe it desirable that these laws be
proved in accordance with said rule, we held in the case
of Willamette Iron and Steel Works v. Muzzal, 61 Phil. 471,
that "a reading of sections 300 and 301 of our Code of Civil
Procedure (now section 41, Rule 123) will convince one that
these sections do not exclude the presentation of other
competent evidence to prove the existence of a foreign law."
In that case, we considered the testimony of an attorney-atlaw of San Francisco, California who quoted verbatim a
section of California Civil Code and who stated that the same
was in force at the time the obligations were contracted, as
sufficient evidence to establish the existence of said law. In
line with this view, we find no error, therefore, on the part of
the Tax Court in considering the pertinent California law as
proved by respondents' witness.
We now take up the question of reciprocity in exemption
from transfer or death taxes, between the State of California
and the Philippines.F
Section 122 of our National Internal Revenue Code, in
pertinent part, provides:
... And, provided, further, That no tax shall be collected
under this Title in respect of intangible personal property
(a) if the decedent at the time of his death was a resident
of a foreign country which at the time of his death did not
impose a transfer of tax or death tax of any character in

respect of intangible personal property of citizens of the


Philippines not residing in that foreign country, or (b) if the
laws of the foreign country of which the decedent was a
resident at the time of his death allow a similar exemption
from transfer taxes or death taxes of every character in
respect of intangible personal property owned by citizens
of the Philippines not residing in that foreign country."
(Emphasis supplied).
On the other hand, Section 13851 of the California
Inheritance Tax Law, insofar as pertinent, reads:.
"SEC. 13851, Intangibles of nonresident: Conditions.
Intangible personal property is exempt from the tax
imposed by this part if the decedent at the time of his
death was a resident of a territory or another State of the
United States or of a foreign state or country which then
imposed a legacy, succession, or death tax in respect to
intangible personal property of its own residents, but
either:.
(a) Did not impose a legacy, succession, or death tax of
any character in respect to intangible personal property
of residents of this State, or
(b) Had in its laws a reciprocal provision under which
intangible personal property of a non-resident was
exempt from legacy, succession, or death taxes of every
character if the Territory or other State of the United
States or foreign state or country in which the
nonresident resided allowed a similar exemption in
respect to intangible personal property of residents of the
Territory or State of the United States or foreign state or
country of residence of the decedent." (Id.)
It is clear from both these quoted provisions that the
reciprocity must be total, that is, with respect to transfer or
death taxes of any and every character, in the case of the
Philippine law, and to legacy, succession, or death taxes of
any and every character, in the case of the California law.
Therefore, if any of the two states collects or imposes and
does not exempt any transfer, death, legacy, or succession
tax of any character, the reciprocity does not work. This is
the underlying principle of the reciprocity clauses in both
laws.
In the Philippines, upon the death of any citizen or resident,
or non-resident with properties therein, there are imposed
upon his estate and its settlement, both an estate and an
inheritance tax. Under the laws of California, only
inheritance tax is imposed. On the other hand, the Federal
Internal Revenue Code imposes an estate tax on nonresidents not citizens of the United States, 7 but does not
provide for any exemption on the basis of reciprocity.
Applying these laws in the manner the Court of Tax Appeals
did in the instant case, we will have a situation where a
Californian, who is non-resident in the Philippines but has
intangible personal properties here, will the subject to the
payment of an estate tax, although exempt from the
payment of the inheritance tax. This being the case, will a
Filipino, non-resident of California, but with intangible
personal properties there, be entitled to the exemption
clause of the California law, since the Californian has not
been exempted from every character of legacy, succession,
or death tax because he is, under our law, under obligation
to pay an estate tax? Upon the other hand, if we exempt the
Californian from paying the estate tax, we do not thereby
entitle a Filipino to be exempt from a similar estate tax in
California because under the Federal Law, which is equally
enforceable in California he is bound to pay the same, there
being no reciprocity recognized in respect thereto. In both
instances, the Filipino citizen is always at a disadvantage.
We do not believe that our legislature has intended such an
unfair situation to the detriment of our own government and
people. We, therefore, find and declare that the lower court
erred in exempting the estate in question from payment of
the inheritance tax.
We are not unaware of our ruling in the case of Collector of
Internal Revenue vs. Lara (G.R. Nos. L-9456 & L-9481, prom.
January 6, 1958, 54 O.G. 2881) exempting the estate of the
deceased Hugo H. Miller from payment of the inheritance tax
imposed by the Collector of Internal Revenue. It will be
noted, however, that the issue of reciprocity between the
pertinent provisions of our tax law and that of the State of
California was not there squarely raised, and the ruling
therein cannot control the determination of the case at bar.
Be that as it may, we now declare that in view of the express
provisions of both the Philippine and California laws that the
exemption would apply only if the law of the other grants an
exemption from legacy, succession, or death taxes of every
character, there could not be partial reciprocity. It would
have to be total or none at all.
With respect to the question of deduction or reduction in the
amount of P4,000.00 based on the U.S. Federal Estate Tax
Law which is also being claimed by respondents, we uphold

and adhere to our ruling in the Lara case (supra) that the
amount of $2,000.00 allowed under the Federal Estate Tax
Law is in the nature of a deduction and not of an exemption
regarding which reciprocity cannot be claimed under the
provision of Section 122 of our National Internal Revenue
Code. Nor is reciprocity authorized under the Federal Law. .
On the issue of the correctness of the appraisal of the two
parcels of land situated in Baguio City, it is contended that
their assessed values, as appearing in the tax rolls 6 months
after the death of Stevenson, ought to have been considered
by petitioner as their fair market value, pursuant to section
91 of the National Internal Revenue Code. It should be
pointed out, however, that in accordance with said proviso
the properties are required to be appraised at their fair
market value and the assessed value thereof shall be
considered as the fair market value only when evidence to
the contrary has not been shown. After all review of the
record, we are satisfied that such evidence exists to justify
the valuation made by petitioner which was sustained by the
tax court, for as the tax court aptly observed:
"The two parcels of land containing 36,264 square meters
were valued by the administrator of the estate in the
Estate and Inheritance tax returns filed by him at
P43,500.00 which is the assessed value of said properties.
On the other hand, defendant appraised the same at
P52,200.00. It is of common knowledge, and this Court
can take judicial notice of it, that assessments for real
estate taxation purposes are very much lower than the
true and fair market value of the properties at a given
time and place. In fact one year after decedent's death or
in 1952 the said properties were sold for a price of
P72,000.00 and there is no showing that special or
extraordinary circumstances caused the sudden increase
from the price of P43,500.00, if we were to accept this
value as a fair and reasonable one as of 1951. Even more,
the counsel for plaintiffs himself admitted in open court
that he was willing to purchase the said properties at
P2.00 per square meter. In the light of these facts we
believe and therefore hold that the valuation of
P52,200.00 of the real estate in Baguio made by
defendant is fair, reasonable and justified in the
premises." (Decision, p. 19).
In respect to the valuation of the 210,000 shares of stock in
the Mindanao Mother Lode Mines, Inc., (a domestic
corporation), respondents contend that their value should be
fixed on the basis of the market quotation obtaining at the
San Francisco (California) Stock Exchange, on the theory
that the certificates of stocks were then held in that place
and registered with the said stock exchange. We cannot
agree with respondents' argument. The situs of the shares of
stock, for purposes of taxation, being located here in the
Philippines, as respondents themselves concede and
considering that they are sought to be taxed in this
jurisdiction, consistent with the exercise of our government's
taxing authority, their fair market value should be taxed on
the basis of the price prevailing in our country.
Upon the other hand, we find merit in respondents' other
contention that the said shares of stock commanded a lesser
value at the Manila Stock Exchange six months after the
death of Stevenson. Through Atty. Allison Gibbs, respondents
have shown that at that time a share of said stock was bid
for at only P.325 (p. 103, t.s.n.). Significantly, the testimony
of Atty. Gibbs in this respect has never been questioned nor
refuted by petitioner either before this court or in the court
below. In the absence of evidence to the contrary, we are,
therefore, constrained to reverse the Tax Court on this point
and to hold that the value of a share in the said mining
company on August 22, 1951 in the Philippine market was
P.325 as claimed by respondents..
It should be noted that the petitioner and the Tax Court
valued each share of stock of P.38 on the basis of the
declaration made by the estate in its preliminary return.
Patently, this should not have been the case, in view of the
fact that the ancillary administrator had reserved and
availed of his legal right to have the properties of the estate
declared at their fair market value as of six months from the
time the decedent died..
On the fifth issue, we shall consider the various deductions,
from the allowance or disallowance of which by the Tax
Court, both petitioner and respondents have appealed..
Petitioner, in this regard, contends that no evidence of
record exists to support the allowance of the sum of
P8,604.39 for the following expenses:.
1) Administrator's fee

P1,204.
34

2) Attorney's fee

6,000.0

0
3) Judicial and
Administrative expenses

Total Deductions

2,052.5
5
P8,604.
39

An examination of the record discloses, however, that the


foregoing items were considered deductible by the Tax Court
on the basis of their approval by the probate court to which
said expenses, we may presume, had also been presented
for consideration. It is to be supposed that the probate court
would not have approved said items were they not
supported by evidence presented by the estate. In allowing
the items in question, the Tax Court had before it the
pertinent order of the probate court which was submitted in
evidence by respondents. (Exh. "AA-2", p. 100, record). As
the Tax Court said, it found no basis for departing from the
findings of the probate court, as it must have been satisfied
that those expenses were actually incurred. Under the
circumstances, we see no ground to reverse this finding of
fact which, under Republic Act of California National
Association, which it would appear, that while still living,
Walter G. Stevenson obtained we are not inclined to pass
upon the claim of respondents in respect to the additional
amount of P86.52 for funeral expenses which was
disapproved by the court a quo for lack of evidence.
In connection with the deduction of P652.50 representing
the amount of realty taxes paid in 1951 on the decedent's
two parcels of land in Baguio City, which respondents claim
was disallowed by the Tax Court, we find that this claim has
in fact been allowed. What happened here, which a careful
review of the record will reveal, was that the Tax Court, in
itemizing the liabilities of the estate, viz:
1) Administrator's fee

P1,204.
34

2) Attorney's fee

6,000.0
0

3) Judicial and
Administration
expenses as of August
9, 1952

2,052.5
5

Total

P9,256.
89

added the P652.50 for realty taxes as a liability of the


estate, to the P1,400.05 for judicial and administration
expenses approved by the court, making a total of
P2,052.55, exactly the same figure which was arrived at by
the Tax Court for judicial and administration expenses.
Hence, the difference between the total of P9,256.98
allowed by the Tax Court as deductions, and the P8,604.39
as found by the probate court, which is P652.50, the same
amount allowed for realty taxes. An evident oversight has
involuntarily been made in omitting the P2,000.00 for
funeral expenses in the final computation. This amount has
been expressly allowed by the lower court and there is no
reason why it should not be. .
We come now to the other claim of respondents that
pursuant to section 89(b) (1) in relation to section 89(a) (1)
(E) and section 89(d), National Internal Revenue Code, the
amount of P10,022.47 should have been allowed the estate
as a deduction, because it represented an indebtedness of
the decedent incurred during his lifetime. In support thereof,
they offered in evidence a duly certified claim, presented to
the probate court in California by the Bank of California
National Association, which it would appear, that while still
living, Walter G. Stevenson obtained a loan of $5,000.00
secured by pledge on 140,000 of his shares of stock in the
Mindanao Mother Lode Mines, Inc. (Exhs. "Q-Q4", pp. 53-59,
record). The Tax Court disallowed this item on the ground
that the local probate court had not approved the same as a
valid claim against the estate and because it constituted an
indebtedness in respect to intangible personal property
which the Tax Court held to be exempt from inheritance tax.
For two reasons, we uphold the action of the lower court in
disallowing the deduction.
Firstly, we believe that the approval of the Philippine probate
court of this particular indebtedness of the decedent is
necessary. This is so although the same, it is averred has
been already admitted and approved by the corresponding
probate court in California, situs of the principal or

domiciliary administration. It is true that we have here in the


Philippines only an ancillary administration in this case, but,
it has been held, the distinction between domiciliary or
principal administration and ancillary
administration serves only to distinguish one administration
from the other, for the two proceedings are separate and
independent.8 The reason for the ancillary administration is
that, a grant of administration does not ex proprio vigore,
have any effect beyond the limits of the country in which it
was granted. Hence, we have the requirement that before a
will duly probated outside of the Philippines can have effect
here, it must first be proved and allowed before our courts,
in much the same manner as wills originally presented for
allowance therein.9 And the estate shall be administered
under letters testamentary, or letters of administration
granted by the court, and disposed of according to the will
as probated, after payment of just debts and expenses of
administration.10 In other words, there is a regular
administration under the control of the court, where claims
must be presented and approved, and expenses of
administration allowed before deductions from the estate
can be authorized. Otherwise, we would have the actuations
of our own probate court, in the settlement and distribution
of the estate situated here, subject to the proceedings
before the foreign court over which our courts have no
control. We do not believe such a procedure is countenanced
or contemplated in the Rules of Court.
Another reason for the disallowance of this indebtedness as
a deduction, springs from the provisions of Section 89, letter
(d), number (1), of the National Internal Revenue Code which
reads:
(d) Miscellaneous provisions (1) No deductions
shall be allowed in the case of a non-resident not a
citizen of the Philippines unless the executor,
administrator or anyone of the heirs, as the case
may be, includes in the return required to be filed
under section ninety-three the value at the time of
his death of that part of the gross estate of the nonresident not situated in the Philippines."
In the case at bar, no such statement of the gross estate of
the non-resident Stevenson not situated in the Philippines
appears in the three returns submitted to the court or to the
office of the petitioner Collector of Internal Revenue. The
purpose of this requirement is to enable the revenue officer
to determine how much of the indebtedness may be allowed
to be deducted, pursuant to (b), number (1) of the same
section 89 of the Internal Revenue Code which provides:
(b) Deductions allowed to non-resident estates.
In the case of a non-resident not a citizen of the
Philippines, by deducting from the value of that part
of his gross estate which at the time of his death is
situated in the Philippines
(1) Expenses, losses, indebtedness, and taxes.
That proportion of the deductions specified in
paragraph (1) of subjection (a) of this
section11 which the value of such part bears the
value of his entire gross estate wherever situated;"
In other words, the allowable deduction is only to the extent
of the portion of the indebtedness which is equivalent to the
proportion that the estate in the Philippines bears to the
total estate wherever situated. Stated differently, if the
properties in the Philippines constitute but 1/5 of the entire
assets wherever situated, then only 1/5 of the indebtedness
may be deducted. But since, as heretofore adverted to,
there is no statement of the value of the estate situated
outside the Philippines, no part of the indebtedness can be
allowed to be deducted, pursuant to Section 89, letter (d),
number (1) of the Internal Revenue Code.
For the reasons thus stated, we affirm the ruling of the lower
court disallowing the deduction of the alleged indebtedness
in the sum of P10,022.47.
In recapitulation, we hold and declare that:
(a) only the one-half (1/2) share of the decedent
Stevenson in the conjugal partnership property
constitutes his hereditary estate subject to the
estate and inheritance taxes;
(b) the intangible personal property is not exempt
from inheritance tax, there existing no complete
total reciprocity as required in section 122 of the
National Internal Revenue Code, nor is the
decedent's estate entitled to an exemption of
P4,000.00 in the computation of the estate tax;
(c) for the purpose of the estate and inheritance
taxes, the 210,000 shares of stock in the Mindanao
Mother Lode Mines, Inc. are to be appraised at
P0.325 per share; and

(d) the P2,000.00 for funeral expenses should be


deducted in the determination of the net asset of
the deceased Stevenson.
In all other respects, the decision of the Court of Tax Appeals
is affirmed.
Respondent's claim for interest on the amount allegedly
overpaid, if any actually results after a recomputation on the
basis of this decision is hereby denied in line with our recent
decision in Collector of Internal Revenue v. St. Paul's
Hospital (G.R. No. L-12127, May 29, 1959) wherein we held
that, "in the absence of a statutory provision clearly or
expressly directing or authorizing such payment, and none
has been cited by respondents, the National Government
cannot be required to pay interest."
WHEREFORE, as modified in the manner heretofore
indicated, the judgment of the lower court is hereby affirmed
in all other respects not inconsistent herewith. No costs. So
ordered.

G.R. No. L-8166

February 8, 1916

JORGE DOMALAGAN, plaintiff-appellee,


vs.
CARLOS BOLIFER, defendant-appellant.
M. Abejuela for appellant.
Troadio Galicano for appellee.
JOHNSON, J.:
This action was commenced in the Court of First Instance of
the Province of Misamis, on the 17th of December, 1910. It
was not presented to the Supreme Court until the 11th of
January 1916. Its purpose was to recover of the defendant
the sum of P516, together with damages estimated in the
sum of P350 and interest, and costs.
In support of his claim the plaintiff alleged that, in the month
of November, 1909, he and the defendant entered into a
contract by virtue of the terms of which he was to pay to the
defendant the sum of P500 upon the marriage of his son
Cipriano Domalagan with the daughter of the defendant,
Bonifacia Bolifer, that later, in the month of August, 1910, he
completed his obligation under said contract by paying to
the defendant the said sum of 500, together with the further
sum of P16 "as hansel or token of future marriage," that,
notwithstanding said agreement, the said Bonifacio Bolifer,
in the month of August, 1910, was joined in lawful wedlock
to Laureano Sisi; that immediately upon learning of the
marriage of Bonifacia Bolifer he demanded of the defendant
the return of the said sum of P516 together with the interest
and damages; that the damages which he suffered resulted
from the fact that he, in order to raise said sum of P500, was
obliged to sell certain real property belonging to him,
located in the Province of Bohol, at a great sacrifice.
To the complaint the defendant presented a general denial.
He also alleged that the facts stated in the complaint do not
constitute a cause of action. Upon the issue presented the
cause was brought on for trial. After hearing the evidence
the Honorable Vicente Nepomuceno, judge, in an extended
opinion in which all of the evidence adduced during the trial
of the cause is carefully analyzed reached the conclusion "of
fact that plaintiff delivered to defendant the sum of P516
sued for and that Carlos Bolifer and Laureana Loquero
received and did not return the said amount," and for the
reason that the evidence did not sufficiently show that the
plaintiff had suffered any additional damages, rendered a
judgment in favor of the plaintiff and against the defendant
in said sum of P516 together with the interest at the rate of
6 per cent from the 17th of December, 1910, and costs.
From that judgment the defendant appealed to this court
and made the following assignments of error:
1. In holding to be proven the fact of the delivery by the
plaintiff of the sum of P516 to the defendant, Carlos
Bolifer; and
2. In holding to be valid and effective the verbal contract
entered into by the plaintiff and the defendant in regard to
the delivery of the money by reason of a prospective
marriage.
The first assignment of error presents a question of fact. The
lower court found that a large preponderance of the
evidence showed that the plaintiff had delivered to the
defendant the sum of P516 in substantially the manner
alleged in the complaint. Taking into consideration that the
lower court saw and heard the witnesses, together with the
further fact that there is an abundance of uncontradicted
proof supporting the findings of the lower court, we are not
inclined to disturb its judgment for any of the reasons given
by the appellant in support of his first assignment of error.
With reference to the second assignment of error, the
appellant calls our attention to the provisions of paragraph 3
of section 335 of the Code of Procedure in Civil Action. The
appellant argues that by virtue of the provisions of said

paragraph and by virtue of the fact that the agreement upon


which the plaintiff relies and under which he paid to the
defendant the sum of P516 had not been reduced to writing,
he could therefore not recover. The appellant contends that
a contract, such as the one relied upon by the plaintiff, in
order to be valid, must be reduced to writing. We have
examined the record in vain to find that the defendant
during the trial of the cause objected to any proof or any
part thereof, presented by the plaintiff which showed or
tended to show the existence of the alleged contract. That
part of said section 335 which the appellant relies upon for
relief provides:
In the following cases an agreement hereafter made shall
be unenforceable by action unless the same, or some
note or memorandum thereof, be in writing, and
subscribed by the party charged, or by his agent;
evidence, therefore, of the agreement can not be
received without the writing or secondary evidence of its
contents:
1. . . .
2. . . .
3. An agreement made upon the consideration of
marriage, other than a mutual promise to marry.
It will be noted, by reference to said section, that "evidence
" of the agreement referred to "can not be received without
the writing or secondary evidence of its contents." As was
said above all of the "evidence" relating to said "agreement"
was admitted without the slightest objection.
Said section (335) does not render oral contracts invalid. A
contract may be valid and yet, by virtue of said section, the
parties will be unable to prove it. Said section provides that
the contract shall not be enforced by an action unless the
same is evidence by some note or memorandum. Said
section simply provides the method by which the contract
mentioned therein may be proved. It does not declare that
said contract are invalid, which have not been reduced to
writing, except perhaps those mentioned in paragraph 5 of
said section (335). A contract may be a perfectly valid
contract even though it is not clothed with the necessary
form. If it is not made in confirmity with said section of
course it cannot be proved, if proper objection is made. But
a failure to except to evidence presented in order to prove
the contract, because it does not conform to the statute, is a
waiver of the provisions of the law. If the parties to an
action, during the trial of the cause, make no objection to
the admissibility of oral evidence to support contracts like
the one in question and permit the contract to be proved, by
evidence other than a writing, it will be just as binding upon
the parties as if it had been reduced to writing. (Anson on
Contracts, p. 75; Conlu vs. Araneta and Guanko, 15 Phil.
Rep., 387; Gallemit vs. Tabiliran, 20 Phil. Rep., 241, 246;
Kuenzle and Streiff vs. Joingco, 22 Phil. Rep., 110, 112;
Gomez vs. Salcedo, 26 Phil. Rep., 485, 489.)
For the foregoing reasons we find nothing in the record
justifying a reversal or modification of the judgment of the
lower court based upon either assignment of error. Therefore
the judgment of the lower court is hereby affirmed, with
costs. So ordered.

G.R. No. L-12093

June 29, 1959

ESTANISLAO SERRANO, plaintiff-appellant,


vs.
MELCHOR SOLOMON, defendant-appellee.
Constante Pimentel for appellant.
Faustino B. Tobia, Eufrecino T. Tagayana, Pedro R. Arce and
Emmanuel U. Ujano for appellee.
MONTEMAYOR, J.:

Estanislao Serrano is appealing the decision of the Court of


First Instance of Ilocos Sur, Judge Jose G. Bautista presiding,
declaring null and void the supposed donation propter
nuptias on which his complaint was based and dismissing
the later upon motion of the defendant. The motion for
dismissal was filed before the hearing but the trial court
deferred action upon it until after submission of evidence by
the parties. Said parties entered into a stipulation of facts
after which they declined to submit any other evidence
except Exhibit "A", the supposed deed of donation propter
nuptias, the translation of which, for purposes of reference,
is reproduced below:
That, I Melchor Solomon, single, Filipino, of legal age,
native of the municipality of Sinait, province of Ilocos Sur
and residing at present in Sinait, having decided to get
married with the consent of my parents, brothers, or
sisters and relatives, have announced and manifested my
determination and desire to Mr. Estanislao Serrano to
whose family the flower I intend to win belongs, namely
Miss Alejandria Feliciano single, born in Hawaii but is
actually residing in Cabugao, Ilocos Sur.
This ardent desire favored by good luck and accepted by
the noble lady the one concerned, is to be realized and
complied with under agreement or stipulation which
affirms, promotes and vivifies the union. This agreement
donating all my exclusive properties in order that we shall
have a basic capital for our conjugal life and in order that
there will be ready maintenance and support of offsprings
has come out voluntarily and expontaneously from me, I
the very one concerned.
These which I am donating my exclusive properties
because I have honestly acquired the same with the sweat
of my brows and I donate them gladly, to wit . . .;
The referred to properties are donated in accordance with
the existing laws of the Philippines and our children out of
the wedlock will be the ones to inherit same inherit same
with equal shares. But if God will not bless our union with
any child one half of all my properties including the
properties acquired our conjugal union will be given the
(to) my brothers or sisters or their heirs if I, the husband
will die before my wife and if my beloved wife will die
before me, one half of all my properties and those
acquired by us will be given to those who have reared my
wife in token of my love to her. . . . (Emphasis supplied)
Alejandria Feliciano, whose father went to Hawaii to seek his
fortune and who until now resides there, had been left to her
father's friend named Estanislao Serrano who took care of
and raised her from the age 12 until she reached
womanhood. On June 21, 1948, defendant Melchor Solomon
married Alejandria. On the same day of the marriage but
before the marriage ceremony he executed the alleged Deed
of Donation, Exhibit "A" above reproduced. Less than nine
months after marriage, or rather on March 2, 1949,
Alejandria died without issue. Several months thereafter
Estanislao Serrano commenced the present action to enforce
and implement the terms of the alleged donation particularly
that portion thereof to the effect that if Alejandria died
before her husband Melchor and left no children, then one
half of Melchor's properties and those acquired by him and
his wife would be given to those persons who had raised and
taken care of her namely, Estanislao Serrano.
Acting upon the motion for dismissal the trial court found
that the donation could not be regarded as a
donationpropter nuptias for the reason that though it was
executed before the marriage, it was not made in
consideration of the marriage and, what is more important,
that the donation was not made to one or both of the
(marriage) contracting parties, but to a third person.
After a careful study of the case, we fully agree with the trial
court. Article 1327 of the Old Civil Code reads:
Art. 1327. Donations by reasons of marriage are those
bestowed before its celebration in consideration of the
same, upon one or both of the spouses.

This article was reproduced in the Civil Code under Article


126. Whether we apply Article 1327 for the reason that the
document Exhibit "A" was executed in 1948 before the
promulgation of the New Civil Code in 1950 or whether we
apply Article 126 of the New Civil Code the result would be
the same.
Was the donation made in considerations of the marriage
between Melchor and Alejandria or was it made
consideration of the death of either of them in the absence
of any children? True, the Deed of Donation was executed on
the occasion when they married. But, the marriage in itself
was not the only consideration or condition under which
terms of the donation would be carried out. The marriage
would have to be childless and one of the spouses would
have to die before the other before the donation would
operate. So, strictly, speaking, the donation may not be
regarded as one made in consideration of the marriage.
But assuming for the moment that it was made in
consideration of the marriage, still, we have the fact that the
donation was being made not in favor of Alejandria, the wife,
but rather in favor of those who acted as her parents and
raised her from girlhood to womanhood in the absence of
her father. That does not place it within the provisions of
Article 1327 and Article 126 of the Old Civil Code and the
New Civil Code, respectively. Manresa, in his commentary on
Article 1327 of the Civil Code says the following:
Donations excluded are those (1) made in favor of the
spouses after the celebration of marriage; (2) executed in
favor of the future spouses but not in consideration of the
marriage; and (3) granted to persons other than the
spouses even though they may be founded on the
marriage (6 M. 232).
Having come to the conclusion that the Deed of Donation
does not fulfill the requirements of a donation propter
nuptias and that it might be considered a donation inter
vivos, can it be considered valid and effective? Hardly,
because it was never accepted by the donee either in the
same instrument or donation or in a separate document as
required by law.
Again, may the donation be regarded a donation mortis
causa, and given effect? The answer has to be in the
negative for the reason that this Tribunal has heretofore
consistently held that a donation to take effect after the
death of the donor, is equivalent to a disposition or bequest
of property by last will, an it should be executed in
accordance with the requisites and strict provisions
governing the execution wills;1 and Exhibit "A" does not fulfill
said requirements. Moreover, in the present case, the donor
is still alive and naturally, even if the donation were
otherwise valid, still, the time and occasion have not arrived
for considering its operation and implementation.
In view of the foregoing, the appealed decision is hereby
affirmed, with costs.

G.R. No. L-27939

October 30, 1928

FORTUNATA SOLIS, plaintiff-appellee,


vs.
MAXIMA BARROSO, ET AL., defendants-appellants.
Mabanag and Primicias, Emiliano A. Ramos and Eugenio S.
Estayo for appellants.
Turner, Rheberg and Sanchez for appellee.

AVANCEA, C. J.:
The spouses Juan Lambino and Maria A. Barroso begot three
children named Alejo, Eugenia and Marciana Lambino. On
June 2, 1919 said spouses made a donation of propter
nuptias of the lands described in the complaint in favor of

their son Alejo Lambino and Fortunata Solis in a private


document (Exhibit A) in consideration of the marriage which
the latter were about to enter into. One of the conditions of
this donation is that in case of the death of one of the
donees, one-half of these lands thus donated would revert to
the donors while the surviving donee would retain the other
half. On the 8th of the said month of June 1919, Alejo
Lambino and Fortunata Solis were married and immediately
thereafter the donors delivered the possession of the
donated lands to them. On August 3, 1919 donee Alejo
Lambino died. In the same year donor Juan Lambino also
died. After the latter's death, his wife, Maxima Barroso,
recovered possession of the donated lands.
The surviving donee Fortunata Solis filed the action, which is
the subject matter of this appeal, against the surviving
donor Maxima Barroso and Eugenia and Marcelina Lambino,
heirs of the deceased donor Juan Lambino, with their
respective husbands, demanding of the defendants the
execution of the proper deed of donation according to law,
transferring one-half of the donated property, and moreover,
to proceed to the partition of the donated property and its
fruits.
The court rendered judgment based upon article 1279 of the
Civil Code granting plaintiff's prayer and ordering the
defendants to execute a deed of donation in favor of the
plaintiff, adequate in form and substance to transfer to the
latter the legal title to the part of the donated lands
assigned to her in the original donation.

this opinion well founded. In donations propter nuptias, the


marriage is really a consideration, but not in the sense of
being necessary to give birth to the obligation. This may be
clearly inferred from article 1333, which makes the fact that
the marriage did not take place a cause for the revocation of
such donations, thus taking it for granted that there may be
a valid donation propter nuptias, even without marriage,
since that which has not existed cannot be revoked. And
such a valid donation would be forever valid, even if the
marriage never took place, if the proper action for
revocation were not instituted, or if it were instituted after
the lapse of the statutory period of prescription. This is, so
because the marriage in a donation propter nuptias is rather
a resolutory condition which, as such, presupposes the
existence of the obligation which may be resolved or
revoked, and it is not a condition necessary for the birth of
the obligation.
The judgment appealed from is reversed and the defendants
are hereby absolved from the complaint, without special
pronouncement of costs. So ordered.

G.R. No. L-26270

October 30, 1969

BONIFACIA MATEO, ET AL., petitioners,


vs.
GERVASIO LAGUA, ET AL., respondents.

We are of the opinion that article 1279 of the Civil Code,


relating to contracts, is not applicable to the present case.

Pedro P. Tuason for petitioners.


Isaiah Asuncion for respondents.

We are concerned with a donation propter nuptias, which,


according to article 1328 of the Civil Code, must be
governed by the rules established in Title II, Book III of this
Code, on donations (articles 618 to 656), Article 633
provides that in order that a donation of real property may
be valid, it must be made in a public instrument. This is the
article applicable to donation propter nuptias in so far as its
formal validity is concerned. The only exceptions to this rule
are onerous and remuneratory donations, in so far as they
do not exceed the value of the charge imposed, which are
then governed by the rules on contracts (art. 622), and
those which are to take effect upon the donor's death, which
are governed by the rules established for testamentary
successions (art. 620).

REYES, J.B.L., J.:

We have, therefore, a donation propter nuptias which is not


valid and did not create any right, since it was not made in a
public instrument, and hence, article 1279 of the Civil Code
which the lower court applied is not applicable thereto. The
last named article provides that, should the law require the
execution of an instrument or any other special form in order
to make the obligations of a contract effective, the
contracting parties may compel each other to comply with
such formality from the moment that consent has been
given, and the other requirements for the validity of the
contract exist. Suffice it to state that this article refers to
contracts and is inapplicable to the donation in question
which must be governed by the rules on donations. It may
further be noted, at first sight, that this article presupposes
the existence of a valid contract and cannot possibly refer to
the form required in order to make it valid, which it already
has, but rather to that required simply to make it effective,
and for this reason, it would, at all events, be inapplicable to
the donation in question, wherein the form is required
precisely to make it valid. 1awph!l.net
But the lower court states in its judgment that the present
donation is onerous, and pursuant to article 622 of the Civil
Code must be governed by the rules on contracts. This
opinion is not well founded. Donations for valuable
consideration, as may be inferred from article 619 of the
Civil Code, are such as compensate services which
constitute debts recoverable from the donor, or which
impose a charge equal to the amount of the donation upon
the donee, neither of which is true of the present donation,
which was made only in consideration of marriage. The
lower court insists that, by the fact that this is a
donation propter nuptias, it is based upon the marriage as a
consideration, and must be considered onerous. Neither is

This is a petition for review of the decision of the Court of


Appeals (In CA-G.R. Nos. 30064-R and 30065-R), raising as
only issue the correctness of the appellate court's reduction
of a donation propter nuptias, for being inofficious.
The established facts of this case are as follows:
Cipriano Lagua was the original registered owner of 3
parcels of land situated in Asingan, Pangasinan, referred to
as Lot No. 998, with an area of 11,080 sq.m., more or less
and covered by O.C.T. No. 362; Lot No. 6541, with an area of
808 sq.m., more or less, covered by O.C.T. No. 6618; and Lot
No. 5106, with an area of 3,303 sq.m., covered by O.C.T. No.
8137. Sometime in 1917, Lagua and his wife Alejandra
Dumlao, in a public instrument, donated Lots 998 and 6541
to their son Alejandro Lagua, in consideration of the latter's
marriage to Bonifacia Mateo. The marriage was celebrated
on 15 May 1917, and thereafter, the couple took possession
of the properties, but the Certificates of Title remained in the
donor's name.
In 1923, the son, Alejandro, died. His widow, Bonifacia
Mateo, and her infant daughter lived with her father-in-law,
Cipriano Lagua, who then undertook the farming of the
donated lots. It seems that at the start, Cipriano Lagua was
giving to Bonifacia the owner's share of the harvest from the
land. In 1926, however, Cipriano refused to deliver the said
share, thus prompting Bonifacia to resort to the Justice of the
Peace Court of Asingan, Pangasinan, from where she
obtained a judgment awarding to her possession of the two
lots plus damages.
On 31 July 1941, Cipriano Lagua, executed a deed of sale of
the same two parcels of land in favor of his younger son,
Gervasio. This sale notwithstanding, Bonifacia Mateo was
continuously given the owner's share of the harvest until
1956, when it was altogether stopped. It was only then that
Bonifacia Mateo learned of the sale of the lots to her brotherin-law, who had the sale in his favor registered only on 22
September 1955. As a consequence, TCT Nos. 19152 and
19153 of the Register of Deeds of Pangasinan were issued to
Gervasio.
Bonifacia Mateo and her daughter, Anatalia, assisted by her
husband, Luis Alcantara, went to the Court of First Instance
of Pangasinan (Civil Case No. T-339), seeking annulment of

the deed of sale in favor of Gervasio Lagua and for recovery


of possession of the properties. On 3 January 1957,
judgment was rendered in the case
... declaring the sale executed by Cipriano Lagua in favor
of the other defendants, Gervasio Lagua and Sotera
Casimero, as null and void and non-existent; ordering the
Register of Deeds for the Province of Pangasinan, to
cancel Transfer Certificates of Title Nos. 19152 and
19153; condemning the defendants to pay jointly and
severally to the plaintiffs the sum of P200.00; ordering
the defendants Gervasio Lagua and Sotera Lagua to
vacate and deliver the possession over the two parcels of
land to the plaintiffs, and to pay the costs of this suit.
The decision became final, and Bonifacia Mateo, and her
daughter, Anatalia Lagua, were installed in possession of the
land.
On 18 August 1957, the spouses Gervasio Lagua and Sotera
Casimero commenced in the Justice of the Peace Court of
Asingan, Pangasinan, an action against Bonifacia Mateo and
her daughter for reimbursement of the improvements
allegedly made by them on Lots 998 and 6541, plus
damages. Dismissed by the Justice of the Peace Court for
being barred by the judgment in Civil Case No. T-339, therein
plaintiffs appealed to the Court of First Instance of
Pangasinan where the case was docketed as Civil Case No. T433. At about the same time, another case was filed, this
time by Gervasio Lagua and Cipriano Lagua, for annulment
of the donation of the two lots, insofar as one-half portion
thereof was concerned (civil Case No. T-442). It was their
claim that in donating the two lots, which allegedly were all
that plaintiff Cipriano Lagua owned, said plaintiff not only
neglected leaving something for his own support but also
prejudiced the legitime of his forced heir, plaintiff Gervasio
Lagua.
Being intimately related, the two cases were heard jointly.
On November 12, 1958, while the cases were pending final
resolution, plaintiff Cipriano Lagua died. On 23 December
1960, the court rendered a single decision dismissing Civil
Case No. T-433 for lack of cause of action, plaintiffs spouses
Gervasio Lagua and Sotera Casimero having been declared
possessors in bad faith in Civil Case No. T-339 and,
therefore, not entitled to any reimbursement of the
expenses and improvements put up by them on the land.
The other suit, Civil Case No. T-442, was, likewise, dismissed
on the ground of prescription, the action to annul the
donation having been brought only in 1958, or after the
lapse of 41 years. Defendants' counterclaims were similarly
dismissed although they were awarded attorneys' fees in the
sum of P150.00.
Plaintiffs appealed the decision to the Court of Appeals (CAG.R. Nos. 30064 and 30065-R). Said tribunal, on 18 March
1966, affirmed the ruling of the trial court in Civil Case No. T433 denying plaintiffs' claim for reimbursement of the
improvements said to have been made on the land. In
regard to the annulment case (C.F.I. No. T-442), however, the
Court of Appeals held that the donation to Alejandro Lagua
of the 2 lots with a combined area of 11,888 square meters
execeeded by 494.75 square meters his (Alejandro's)
legitime and the disposable portion that Cipriano Lagua
could have freely given by will, and, to the same extent
prejudiced the legitime of Cipriano's other heir, Gervasio
Lagua. The donation was thus declared inofficious, and
defendants-appellees were ordered to reconvey to plaintiff
Gervasio Lagua a portion of 494.15 square meters to be
taken from any convenient part of the lots. The award of
attorneys' fees to the defendants was also eliminated for
lack of proper basis.
Bonifacia Mateo, et al., then resorted to this Court, assailing
the decision of the Court of Appeals insofar as it ordered
them to reconvey a portion of the lots to herein respondent
Gervasio Lagua. It is petitioners' contention that (1) the
validity of the donation proper nuptias having been finally
determined in Civil Case No. T-339, any question in
derogation of said validity is already barred; (2) that the
action to annul the donation, filed in 1958, or 41 years after
its execution, is abated by prescription; (3) that a
donation proper nuptias is revocable only for any of the

grounds enumerated in Article 132 of the new Civil Code,


and inofficiousness is not one of thorn; and (4) that in
determining the legitime of the Lagua brothers in the
hereditary estate of Cipriano Lagua, the Court of Appeals
should have applied the provisions of the Civil Code of 1889,
and not Article 888 of the new Civil Code.
Petitioners' first two assigned errors, it may be stated, are
non-contentious issues that have no bearing in the actual
controversy in this case. All of them refer to the validity of
the donation a matter which was definitively settled in
Civil Case No. T-339 and which, precisely, was declared by
the Court of Appeals to be "beyond the realm of judicial
inquiry." In reality, the only question this case presents is
whether or not the Court of Appeals acted correctly in
ordering the reduction of the donation for being inofficious
and in ordering herein petitioners to reconvey to respondent
Gervasio Lagua an unidentified 494.75 square-meter portion
of the donated lots.
We are in accord with the Court of Appeals that Civil Case
No. 442 is not one exclusively for annulment or revocation of
the entire donation, but of merely that portion thereof
allegedly trenching on the legitime of respondent Gervasio
Lagua;1 that the cause of action to enforce Gervasio's
legitime, having accrued only upon the death of his father
on 12 November 1958, the dispute has to be governed by
the pertinent provisions of the new Civil Code; and that a
donation proper nuptias property may be reduced for being
inofficious. Contrary to the views of appellants (petitioners),
donations proper nuptias (by reason of marriage) are
without onerous consideration, the marriage being merely
the occasion or motive for the donation, not its causa. Being
liberalities, they remain subject to reduction for
inofficiousness upon the donor's death, if they should
infringe the legitime of a forced heir.2
It is to be noted, however, that in rendering the judgment
under review, the Court of Appeals acted on several
unsupported assumptions: that the three (3) lots mentioned
in the decision (Nos. 998, 5106 and 6541) were
theonly properties composing the net hereditary estate of
the deceased Cipriano Lagua; that Alejandro Lagua and
Gervasio Lagua were his only legal heirs; that the deceased
left no unpaid debts, charges, taxes, etc., for which the
estate would be answerable.3 In the computation of the
heirs' legitime, the Court of Appeals also considered only the
area, not the value, of the properties.
The infirmity in the above course of action lies in the fact
that in its Article 908 the new Civil Code specifically provides
as follows:
ART. 908. To determine the legitime, the value of the
property left at the death of the testator shall be
considered, deducting all debts, and charges, which shall
not include those imposed in the will.
To the net value of the hereditary estate, shall be added
the value of all donations by the testator that are subject
to collation, at the time he made them.
In other words, before any conclusion about the legal share
due to a compulsory heir may be reached, it is necessary
that certain steps be taken first. The net estate of the
decedent must be ascertained, by deducting an payable
obligations and charges from the value of the property
owned by the deceased at the time of his death; then, all
donations subject to collation would be added to it. With the
partible estate thus determined, the legitimes of the
compulsory heir or heirs can be established; and only
thereafter can it be ascertained whether or not a donation
had prejudiced the legitimes. Certainly, in order that a
donation may be reduced for being inofficious, there must
be proof that the value of the donated property exceeds that
of the disposable free portion plus the donee's share as
legitime in the properties of the donor.4 In the present case,
it can hardly be said that, with the evidence then before the
court, it was in any position to rule on the inofficiousness of
the donation involved here, and to order its reduction and
reconveyance of the deducted portion to the respondents.

FOR THE FOREGOING CONSIDERATIONS, the decision of the


Court of Appeals, insofar as Civil Case No. 442 of the court a
quo is concerned, is hereby set aside and the trial court's
order of dismissal sustained, without prejudice to the parties'
litigating the issue of inofficiousness in a proper proceeding,
giving due notice to all persons interested in the estate of
the late Cipriano Lagua. Without costs.

[G.R. No. L-28771. March 31, 1971.]


CORNELIA MATABUENA, Plaintiff-Appellant, v.
PETRONILA CERVANTES, Defendant-Appellee.
Alegre, Roces, Salazar & Saez, for PlaintiffAppellant.
Fernando Gerona, Jr., for Defendant-Appellee.
SYLLABUS
1. CIVIL LAW; PROPERTY RELATIONS BETWEEN HUSBAND
AND WIFE; DONATIONS BY REASON OF MARRIAGE;
PROHIBITION AGAINST DONATION BETWEEN SPOUSES
DURING MARRIAGE; APPLICABLE TO COMMON LAW
RELATIONSHIP. While Art. 133 of the Civil Code considers
as void a "donation between the spouses during the
marriage", policy considerations of the most exigent
character as well as the dictates of morality require that the
same prohibition should apply to a common-law relationship.
A 1954 Court of Appeals decision Buenaventura v. Bautista,
(50 O.G. 3679) interpreting a similar provision of the old Civil
Code speaks unequivocally. If the policy of the law is, in the
language of the opinion of the then Justice J.B.L. Reyes of
that Court, "to prohibit donations in favor of the other
consort and his descendants because of fear of undue and
improper pressure and influence upon the donor, a prejudice
deeply rooted in our ancient law; porque no se engaen
despojandose el uno al otro por amor que han de consuno,
[according to] the Partidas (Part. IV, Tit. Xl, LAW IV),
reiterating the rationale Ne mutuato amore invicem
spoliarentur of the Pandects (Bk 24, Tit. I, De donat, inter
virum et uxorem); then there is every reason to apply the
same prohibitive policy to persons living together as
husband and wife without benefit of nuptials. For it is not to
be doubted that assent to such irregular connection for
thirty years bespeaks greater influence of one party over the
other, so that the danger that the law seeks to avoid is
correspondingly increased. Moreover, as already pointed out
by Ulpian (in his lib. 32 ad Sabinum, fr. 1), it would not be
just that such donations should subsist lest the condition of
those who incurred guilt should turn out to be better. So long
as marriage remains the cornerstone of our family law,
reason and morality alike demand that the disabilities
attached to marriage should likewise attach to concubinage.
2. ID.; SUCCESSION; INTESTATE SUCCESSION; SURVIVING
SPOUSE; RULE WHERE A SISTER SURVIVES WITH THE
WIDOW. The lack of validity of the donation made b~ the
deceased to defendant Petronila Cervantes does not
necessarily result in plaintiff having exclusive right to the
disputed property. Prior to the death of Felix Matabuena, the
relationship between him and the defendant was legitimated
by their marriage on March 28. 1962. She is therefore his
widow. As provided in the Civil Code, she is entitled to onehalf of the inheritance and the plaintiff, as the surviving
sister to the other half.
DECISION
FERNANDO, J.:
A question of first impression is before this Court in this
litigation. We are called upon to decide whether the ban on a
donation between the spouses during a marriage applies to
a common-law relationship. 1 The plaintiff, now appellant
Cornelia Matabuena, a sister to the deceased Felix
Matabuena, maintains that a donation made while he was
living maritally without benefit of marriage to defendant,
now appellee Petronila Cervantes, was void. Defendant
would uphold its validity. The lower court, after noting that it
was made at a time before defendant was married to the
donor, sustained the latters stand. Hence this appeal. The
question, as noted, is novel in character, this Court not
having had as yet the opportunity of ruling on it. A 1954
decision of the Court of Appeals, Buenaventura v. Bautista, 2
by the then Justice J. B. L. Reyes, who was appointed to this
Court later that year, is indicative of the appropriate
response that should be given. The conclusion reached
therein is that a donation between common-law spouses
falls within the prohibition and is "null and void as contrary
to public policy." 3 Such a view merits fully the acceptance
of this Court. The decision must be reversed.
In the decision of November 23, 1965, the lower court, after
stating that in plaintiffs complaint alleging absolute
ownership of the parcel of land in question, she specifically
raised the question that the donation made by Felix

Matabuena to defendant Petronila Cervantes was null and


void under the aforesaid article of the Civil Code and that
defendant on the other hand did assert ownership precisely
because such a donation was made in 1956 and her
marriage to the deceased did not take place until 1962,
noted that when the case was called for trial on November
19, 1965, there was stipulation of facts which it quoted. 4
Thus: "The plaintiff and the defendant assisted by their
respective counsels, jointly agree and stipulate: (1) That the
deceased Felix Matabuena owned the property in question;
(2) That said Felix Matabuena executed a Deed of Donation
inter vivos in favor of Defendant, Petronila Cervantes over
the parcel of land in question on February 20, 1956, which
same donation was accepted by defendant; (3) That the
donation of the land to the defendant which took effect
immediately was made during the common law relationship
as husband and wife between the defendant-done and the
now deceased donor and later said donor and done were
married on March 28, 1962; (4) That the deceased Felix
Matabuena died intestate on September 13, 1962; (5) That
the plaintiff claims the property by reason of being the only
sister and nearest collateral relative of the deceased by
virtue of an affidavit of self-adjudication executed by her in
1962 and had the land declared in her name and paid the
estate and inheritance taxes thereon" 5
The judgment of the lower court on the above facts was
adverse to plaintiff. It reasoned out thus: "A donation under
the terms of Article 133 of the Civil Code is void if made
between the spouses during the marriage. When the
donation was made by Felix Matabuena in favor of the
defendant on February 20, 1956, Petronila Cervantes and
Felix Matabuena were not yet married. At that time they
were not spouses. They became spouses only when they
married on March 28, 1962, six years after the deed of
donation had been executed." 6
We reach a different conclusion. While Art. 133 of the Civil
Code considers as void a "donation between the spouses
during the marriage," policy considerations of the most
exigent character as well as the dictates of morality require
that the same prohibition should apply to a common-law
relationship. We reverse.
1. As announced at the outset of this opinion, a 1954 Court
of Appeals decision, Buenaventura v. Bautista, 7 interpreting
a similar provision of the old Civil Code 8 speaks
unequivocally. If the policy of the law is, in the language of
the opinion of the then Justice J.B.L. Reyes of that Court, "to
prohibit donations in favor of the other consort and his
descendants because of fear of undue and improper
pressure and influence upon the donor, a prejudice deeply
rooted in our ancient law; porque no se engaen
despojandose el uno al otro por amor que han de consuno
[according to] the Partidas (Part IV, Tit. XI, LAW IV),
reiterating the rationale Ne mutuato amore invicem
spoliarentur of the Pandects (Bk. 24, Tit. 1, De donat, inter
virum et uxorem); then there is every reason to apply the
same prohibitive policy to persons living together as
husband and wife without the benefit of nuptials. For it is not
to be doubted that assent to such irregular connection for
thirty years bespeaks greater influence of one party over the
other, so that the danger that the law seeks to avoid is
correspondingly increased. Moreover, as already pointed out
by Ulpian (in his lib. 32 ad Sabinum, fr. 1), it would not be
just that such donations should subsist, lest the condition of
those who incurred guilt should turn out to be better. So
long as marriage remains the cornerstone of our family law,
reason and morality alike demand that the disabilities
attached to marriage should likewise attach to
concubinage." 9
2. It is hardly necessary to add that even in the absence of
the above pronouncement, any other conclusion cannot
stand the test of scrutiny. It would be to indict the framers of
the Civil Code for a failure to apply a laudable rule to a
situation which in its essentials cannot be distinguished.
Moreover, if it is at all to be differentiated, the policy of the
law which embodies a deeply-rooted notion of what is just
and what is right would be nullified if such irregular
relationship instead of being visited with disabilities would
be attended with benefits. Certainly a legal norm should not
be susceptible to such a reproach. If there is ever any
occasion where the principle of statutory construction that
what is within the spirit of the law is as much a part of it as
what is written, this is it. Otherwise the basic purpose
discernible in such codal provision would not be attained.
Whatever omission may be apparent in an interpretation
purely literal of the language used must be remedied by an
adherence to its avowed objective. In the language of Justice
Pablo: "El espiritu que informa la ley debe ser la luz que ha

de guiar a los tribunales en la aplicacin de sus


disposiciones. 10
3. The lack of validity of the donation made by the deceased
to defendant Petronila Cervantes does not necessarily result
in plaintiff having exclusive right to the disputed property.
Prior to the death of Felix Matabuena, the relationship
between him and the defendant was legitimated by their
marriage on March 28, 1962. She is therefore his widow. As
provided for in the Civil Code, she is entitled to one-half of
the inheritance and the plaintiff, as the surviving sister, to
the other half. 11
WHEREFORE, the lower court decision of November 23, 1965
dismissing the complaint with costs is reversed. The
questioned donation is declared void, with the rights of
plaintiff and defendant as pro indiviso heirs to the property
in question recognized. The case is remanded to the lower
court for its appropriate disposition in accordance with the
above opinion. Without pronouncement as to costs.

G.R. No. L-12707

August 10, 1918

MRS. HENRY E. HARDING, and her husband, plaintiffsappellees,


vs.
COMMERCIAL UNION ASSURANCE COMPANY, defendantappellant.
Lawrence & Ross for appellant.
Gibbs, McDonough & Johnson for appellees.
FISHER, J.:
This was an action by plaintiffs to recover from defendant
the sum of P3,000 and interest, alleged to be due under the
terms of a policy of insurance. The trial court gave plaintiffs
judgment for the amount demanded, with interest and costs,
and from that decision the defendant appeals.
The court below stated the issues made by the pleadings in
this case, and its finding of fact, as follows:
It is alleged by plaintiffs and admitted by defendant that
plaintiffs are husband and wife and residents of the city of
Manila; that the defendant is a foreign corporation
organized and existing under and by virtue of the laws of
Great Britain and duly registered in the Philippine Islands,
and Smith, Bell & Co. (limited), a corporation organized
and existing under the laws of the Philippine Islands, with
its principal domicile in the city of Manila, is the agent in
the Philippine Islands of said defendant.
The plaintiffs alleged that on February 16, 1916, the
plaintiff Mrs. Henry E. Harding was the owner of a
Studebaker automobile, registered number 2063, in the
city of Manila; that on said date; in consideration of the
payment to the defendant of the premium of P150, by said
plaintiff, Mrs. Henry E. Harding, with the consent of her
husband, the defendant by its duly authorized agent,
Smith, Bell & Company (limited), made its policy of
insurance in writing upon said automobile was set forth in
said policy to be P3,000 that the value of said automobile
was set forth in said policy (Exhibit A) to be P3,000; that
on March 24, 1916, said automobile was totally destroyed
by fire; that the loss thereby to plaintiffs was the sum of
P3,000; that thereafter, within the period mentioned in the
said policy of insurance, the plaintiff, Mrs. Henry E.
Harding, furnished the defendant the proofs of her said
loss and interest, and otherwise performed all the
conditions of said policy on her part, and that the
defendant has not paid said loss nor any part thereof,
although due demand was made upon defendant therefor.
The defendant, by its answer, admitted the allegations of
the residence and status of the parties and denied all the
other allegation of the said complaint, and for a separate
and affirmative defense alleged (1) that on February 17,
1916, at the city of Manila, P.I. the defendant upon request
of plaintiff, Mrs. Henry E. Harding, issued to the said
plaintiff the policy of insurance on an automobile alleged
by the said plaintiff to be her property; that the said

request for the issuance of said policy of insurance was


made by means of a proposal in writing signed and
delivered by said plaintiff to the defendant, guaranteeing
the truth of the statements contained therein which said
proposal is referred to in the said policy of insurance made
a part thereof; (2) that certain of the statements and
representations contained in said proposal and warranted
by said plaintiff to be true, to wit: (a) the price paid by the
proposer for the said automobile; (b) the value of said
automobile at the time of the execution and delivery of
the said proposal and (c) the ownership of said
automobile, were false and known to be false by the said
plaintiff at the time of signing and delivering the said
proposal and were made for the purpose of misleading
and deceiving the defendant, and inducing the defendant,
relying upon the warranties, statements, and
representations contained in the said proposal and
believing the same to be true, issued the said policy of
insurance.
The defendant prays that judgment be entered declaring
the said policy of insurance to be null and void, and that
plaintiffs take nothing by this action; and for such further
relief as to the court may seem just and equitable.
The evidence in this case shows that some time in the
year 1913 Levy Hermanos, the Manila agents for the
Studebaker automobile, sold the automobile No. 2063 to
John Canson for P3,200 (testimony of Mr. Diehl); that
under date of October 14, 1914, John Canson sold the said
automobile to Henry Harding for the sum of P1,500
(Exhibit 2); that under date of November 19, 1914, the
said Henry Harding sold the said automobile No. 2063 to J.
Brannigan, of Los Baos, Province of Laguna, P.I., for the
sum of P2,000 (Exhibit 3); that under date of December
20, 1915, J. C. Graham of Los Baos, Province of Laguna,
P.I., sold the said automobile No. 2063 to Henry Harding of
the city of Manila for the sum of P2,800 (Exhibit 4 and
testimony of J. C. Graham); that on or about January 1,
1916, the said Henry Harding gave the said automobile to
his wife; Mrs. Henry E. Harding, one of the plaintiffs, as a
present; that said automobile was repaired and repainted
at the Luneta Garage at a cost of some P900 (testimony of
Mr. Server); that while the said automobile was at the
Luneta Garage; the said Luneta Garage, acting as agent
for Smith, Bell & Company, (limited), solicited of the
plaintiff Mrs. Harding the insurance of said automobile by
the defendant Company (testimony of Mrs. Henry Harding
and Mr. Server); that a proposal was filled out by the said
agent and signed by the plaintiff Mrs. Henry E. Harding,
and in said proposal under the heading "Price paid by
proposer," is the amount of "3,500" and under another
heading "Present value" is the amount of "3,000" (Exhibit
1).
The evidence tends to show that after the said proposal
was made a representative of the Manila agent of
defendant went to the Luneta Garage and examined said
automobile No. 2063 and Mr. Server, the General Manager
of the Luneta Garage, an experienced automobile
mechanic, testified that at the time this automobile was
insured it was worth about P3,000, and the defendant, by
and through its said agent Smith, Bell & Company
(limited), thereafter issued a policy of insurance upon
proposal in which policy the said automobile was
described as of the "present value" of P3,000 and the said
defendant charged the said plaintiff Mrs. Henry E. Harding
as premium on said policy the sum of P150, or 5 per cent
of the then estimated value of P3,000. (Exhibit A.)
The "Schedule" in said policy of insurance describes
the automobile here in question, and provides in
part of follows:
"Now it is hereby agreed as follows:
"That during the period above set forth and during
any period for which the company may agree to
renew this policy the company will subject to the
exception and conditions contained herein or
endorsed hereon indemnify the insured against loss of
or damage to any motor car described in the schedule
hereto (including accessories) by whatever cause

such loss or damage may be occasioned and will


further indemnify the insured up to the value of the
car or P3,000 whichever is the greater against any
claim at common law made by any person (not being
a person in the said motor car nor in the insured's
service) for loss of life or for accidental bodily injury
or damage to property caused by the said motor car
including law costs payable in connection with such
claim when incurred with the consent of the
company."
The evidence further shows that on March 24, 1916, the
said automobile was totally destroyed by fire, and that the
iron and steel portions of said automobile which did not
burn were taken into the possession of the defendant by
and through its agent Smith, Bell & Company (limited),
and sold by it for a small sum, which had never been
tendered to the plaintiff prior to the trial of this case, but
in open court during the trial the sum of P10 as the
proceeds of such sale was tendered to plaintiff and
refused.
Upon the facts so found, which we hold are supported by the
evidence, the trial judge decided that there was no proof of
fraud on the part of plaintiff in her statement of the value of
the automobile, or with respect to its ownership; that she
had an insurable interest therein; and that defendant,
having agreed to the estimated value, P3,000, and having
insured the automobile for that amount, upon the basis of
which the premium was paid, is bound by it and must pay
the loss in accordance with the stipulated insured value. The
assignments of error made on behalf of appellant put in
issue the correctness of those conclusions of law, and some
others of minor importance relating to the exclusion of
evidence. Disposing of the minor objections first, as we have
reached the conclusion that the trial court was right in
holding that the defendant is bound by the estimated value
of the automobile upon which policy was issued, and that
the plaintiff was not guilty of fraud in regard thereto, the
exclusion of the testimony of the witness Diehl is without
importance. It merely tended to show the alleged actual
value of the automobile, and in the view we take of the case
such evidence was irrelevant.
Appellant contends that Mrs. Harding was not the owner of
the automobile at the time of the issuance of the policy, and,
therefore, had no insurable interest in it. The court below
found that the automobile was given to plaintiff by her
husband shortly after the issuance of the policy here in
question. Appellant does not dispute the correctness of this
finding, but contends that the gift was void, citing article
1334 of the Civil Code which provides that "All gifts between
spouses during the marriage shall be void. Moderate gifts
which the spouses bestow on each other on festive days of
the family are not included in this rule."
We are of the opinion that this contention is without merit. In
the case of Cook vs. McMicking 27 Phil. Rep., 10), this court
said:
It is claimed by the appellants that the so-called transfer
from plaintiff's husband to her was completely void under
article 1458 of the Civil Code and that, therefore, the
property still remains the property of Edward Cook and
subject to levy under execution against him.
In our opinion the position taken by appellants is
untenable. They are not in a position to challenge the
validity of the transfer, if it may be called such. They bore
absolutely no relation to the parties to the transfer at the
time it occurred and had no rights or interests inchoate,
present, remote, or otherwise, in the property in question
at the time the transfer occurred. Although certain
transfers from husband to wife or from wife to husband
are prohibited in the article referred to, such prohibition
can be taken advantage of only by persons who bear such
a relation to the parties making the transfer or to the
property itself that such transfer interferes with their
rights or interests. Unless such a relationship appears the
transfer cannot be attacked.
Even assuming that defendant might have invoked article
1334 as a defense, the burden would be upon it to show that

the gift in question does not fall within the exception therein
established. We cannot say, as a matter of law, that the gift
of an automobile by a husband to his wife is not a moderate
one. Whether it is or is not would depend upon the
circumstances of the parties, as to which nothing is
disclosed by the record.
Defendant contends that the statement regarding the cost of
the automobile was a warranty, that the statement was
false, and that, therefore, the policy never attached to the
risk. We are of the opinion that it has not been shown by the
evidence that the statement was false on the contrary we
believe that it shows that the automobile had in fact cost
more than the amount mentioned. The court below found,
and the evidence shows, that the automobile was bought by
plaintiff's husband a few weeks before the issuance of the
policy in question for the sum of P2,800, and that between
that time and the issuance of the policy some P900 was
spent upon it in repairs and repainting. The witness Server,
an expert automobile mechanic, testified that the
automobile was practically as good as new at the time the
insurance was effected. The form of proposal upon which the
policy was issued does not call for a statement regarding the
value of the automobile at the time of its acquisition by the
applicant for the insurance, but merely a statement of its
cost. The amount stated was less than the actual outlay
which the automobile represented to Mr. Harding, including
repairs, when the insurance policy was issued. It is true that
the printed form calls for a statement of the "price paid by
the proposer," but we are of the opinion that it would be
unfair to hold the policy void simply because the outlay
represented by the automobile was made by the plaintiff's
husband and not by his wife, to whom he had given the
automobile. It cannot be assumed that defendant should not
have issued the policy unless it were strictly true that the
price representing the cost of the machine had been paid by
the insured and by no other person that it would no event
insure an automobile acquired by gift, inheritance,
exchange, or any other title not requiring the owner to make
a specific cash outlay for its acquisition.
Furthermore, the court below found and the evidence shows,
without dispute, that the proposal upon which the policy in
question was issued was made out by defendant's agent by
whom the insurance was solicited, and that appellee simply
signed the same. It also appears that an examiner employed
by the defendant made an inspection of the automobile
before the acceptance of the risk, and that the sum after this
examination. The trial court found that Mrs. Harding, in
fixing the value of the automobile at P3,000, acted upon
information given her by her husband and by Mr. Server, the
manager of the Luneta Garage. The Luneta Garage, it will be
remembered, was the agent of the defendant corporation in
the solicitation of the insurance. Mrs. Harding did not state
of her own knowledge that the automobile originally cost
P3,000, or that its value at the time of the insurance was
P3,000. She merely repeated the information which had
been given her by her husband, and at the same time
disclosed to defendant's agent the source of her information.
There is no evidence to sustain the contention that this
communication was made in bad faith. It appears that the
statements in the proposal as to the price paid for the
automobile and as to its value were written by Mr. Quimby
who solicited the insurance on behalf of defendant, in his
capacity as an employee of the Luneta Garage, and wrote
out the proposal for Mrs. Harding to sign. Under these
circumstances, we do not think that the facts stated in the
proposal can be held as a warranty of the insured, even if it
should have been shown that they were incorrect in the
absence of proof of willful misstatement. Under such
circumstance, the proposal is to be regarded as the act of
the insurer and not of the insured. This question was
considered in the case of the Union Insurance
Company vs. Wilkinson (13 Wall., 222; 20 L. ed., 617), in
which the Supreme Court of the United States said:
This question has been decided differently by courts of the
highest respectability in cases precisely analogous to the
present. It is not to be denied that the application logically
considered, is the work of the assured, and if left to
himself or to such assistance as he might select, the
person so selected would be his agent, and he alone
would be responsible. On the other hand, it is well-known,
so well that no court would be justified in shutting its eyes

to it, that insurance companies organized under the laws


of one State, and having in that State their principal
business office, send these agents all over the land, with
directions to solicit and procure applications for policies
furnishing them with printed arguments in favor of the
value and necessity of life insurance, and of the special
advantages of the corporation which the agent represents.
They pay these agents large commissions on the
premiums thus obtained, and the policies are delivered at
their hands to the assured. The agents are stimulated by
letters and instructions to activity in procuring contracts,
and the party who is in this manner induced to take out a
policy, rarely sees or knows anything about the company
or its officers by whom it is issued, but looks to and relies
upon the agent who has persuaded him to effect
insurance as the full and complete representative of the
company, in all that is said or done in making the
contract. Has he not a right to so regard him? It is quite
true that the reports of judicial decisions are filled with the
efforts of these companies, by their counsel, to establish
the doctrine for the acts of these agents to the simple
receipt of the premium and delivery of the policy, the
argument being that, as to all other acts of the agent, he
is the agent of the assured. This proposition is not without
support in some of the earlier decision on the subject;
and, at a time when insurance companies waited for
parties to come to them to seek assurance, or to forward
applications on their own motion, the doctrine had a
reasonable foundation to rest upon. But to apply such a
doctrine, in its full force, to the system of selling policies
through agents, which we have described, would be a
snare and a delusion, leading, as it has done in numerous
instances, to the grossest frauds, of which the insurance
corporations receive the benefits, and the parties
supposing themselves insured are the victims. The
tendency of the modern decisions in this country is
steadily in the opposite direction. The powers of the agent
are, prima facie, co-extensive with the business intrusted
to his care, and will not be narrowed by limitations not
communicated to the person with whom he deals.
(Bebee vs. Ins. Co., 25 Conn., 51; Lycoming Ins.
Co. vs. Schoolenberger, 44 Pa., 259; Bealvs. Ins. Co., 16
Wis., 241; Davenport vs. Ins. Co., 17 Iowa, 276.) An
insurance company, establishing a local agency, must be
held responsible to the parties with whom they transact
business, for the acts and declarations of the agent, within
the scope of his employment, as if they proceeded from
the principal. (Sav. Bk. vs. Ins. Co., 31 Conn., 517;
Hortwitz vs. Ins. Co., 40 Mo., 557; Ayres vs. Ins. Co., 17
Iowa, 176; Howard Ins. Co. vs. Bruner, 23 Pa., 50.)
In the fifth edition of American Leading Cases, 917, after
a full consideration of the authorities, it is said:
"By the interested or officious zeal of the agents
employed by the insurance companies in the wish to
outbid each other and procure customers, they not
unfrequently mislead the insured, by a false or
erroneous statement of what the application should
contain; or, taking the preparation of it into their own
hands, procure his signature by an assurance that it is
properly drawn, and will meet the requirements of the
policy. The better opinion seems to be that, when this
course is pursued, the description of the risk should,
though nominally proceeding from the insured, be
regarded as the act of the insurers." (Rowley vs. Empire
Ins. Co., 36 N.Y., 550.)
The modern decisions fully sustain this proposition, and
they seem to us founded on reason and justice, and meet
our entire approval. This principle does not admit oral
testimony to vary or contradict that which is in writing, but
it goes upon the idea that the writing offered in evidence
was not the instrument of the party whose name is signed
to it; that it was procured under such circumstances by
the other side as estops that side from using it or relying
on its contents; not that it may be contradicted by oral
testimony, but that it may be shown by such testimony
that it cannot be lawfully used against the party whose
name is signed to it. (See also Am. Life Ins.
Co. vs. Mahone, 21 Wallace, 152.)
The defendant, upon the information given by plaintiff, and
after an inspection of the automobile by its examiner, having

agreed that it was worth P3,000, is bound by this valuation


in the absence of fraud on the part of the insured. All
statements of value are, of necessity, to a large extent
matters of opinion, and it would be outrageous to hold that
the validity of all valued policies must depend upon the
absolute correctness of such estimated value. As was said
by the Supreme Court of the United States in the case of the
First National Bank vs. Hartford Fire Insurance Co. (5 Otto,
673; 24 L. ed., 563), at. p. 565 of the Lawyers Edition:
The ordinary test of the value of property is the price it will
commend in the market if offered for sale. But that test
cannot, in the very nature of the case, be applied at the
time application is made for insurance. Men may honestly
differ about the value of property, or as to what it will
bring in the market; and such differences are often very
marked among those whose special business it is to buy
and sell property of all kinds. The assured could do no
more than estimate such value; and that, it seems, was all
that he was required to do in this case. His duty was to
deal fairly with the Company in making such estimate. The
special finding shows that he discharged that duty and
observed good faith. We shall not presume that the
Company, after requiring the assured in his application to
give the "estimated value," and then to covenant that he
had stated all material facts in regard to such value, so far
as known to him, and after carrying that covenant, by
express words, into the written contract, intended to
abandon the theory upon which it sought the contract,
and make the absolute correctness of such estimated
value a condition precedent to any insurance whatever.
The application, with its covenant and stipulations, having
been made a part of the policy, that presumption cannot
be indulged without imputing to the Company a purpose,
by studied intricacy or an ingenious framing of the policy,
to entrap the assured into incurring obligations which,
perhaps, he had no thought of assuming.
Section 163 of the Insurance Law (Act No. 2427) provides
that "the effect of a valuation in a policy of fire insurance is
the same as in a policy of marine insurance."
By the terms of section 149 of the Act cited, the valuation in
a policy of marine insurance is conclusive if the insured had
an insurable interest and was not guilty of fraud.
We are, therefore, of the opinion and hold that plaintiff was
the owner of the automobile in question and had an
insurable interest therein; that there was no fraud on her
part in procuring the insurance; that the valuation of the
automobile, for the purposes of the insurance, is binding
upon the defendant corporation, and that the judgment of
the court below is, therefore, correct and must be affirmed,
with interest, the costs of this appeal to be paid by the
appellant. So ordered.

[G.R. No. 106060. June 21, 1999]


EMILIE T. SUMBAD and BEATRICE B.
TAIT, petitioners, vs. THE COURT OF APPEALS,
EDUARD OKOREN, OLIVIA T. AKOKING, EVELYN W.
SACLANGEN, assisted by her husband Julio Saclangen,
MARY ATIWAG assisted by her husband Arthur
Atiwag, JAIME T. FRONDA, BARBARA TALLONGEN,
JULIA PIYES, assisted by her husband Edward Piyes,
GLEN PAQUITO and FELICITAS ALINAO, respondents.
DECISION
MENDOZA J.:
This is a petition for review of the decision [1] of the
Court of Appeals, Fifth Division, dated May 28, 1992, in CAG.R. CV No. 32711, affirming, with modification, the
dismissal by the Regional Trial Court of Bontoc, Mountain
Province, Branch 36, of a complaint for quieting of title,
annulment of sale, and recovery of possession filed by
petitioners against private respondents.

The facts are as follows:


After the death of his wife, Agata B. Tait, in 1936,
George K. Tait, Sr. lived in common-law relationship with
Maria F. Tait to whom on April 2, 1974 he donated a certain
parcel of unregistered land in Sitio Sum-at, Bontoc, more
particularly described as follows:
One (1) parcel of unregistered agricultural land situated in
sitio Sumat, Bontoc, Mt. Province, bounded on the North by
Sumat Creek and the rice field of Inginga Limayog, East by
the Hospital Reservation of Bontoc and the lots of Agustin
Ututan and Inginga, South by a Foot Trail and West by the
Roman Catholic Mission, Pakeopan and the rice fields of
Narding and Pappi, previously declared under Tax Dec. No.
6000 of Bontoc, Mt. Province;[2]
George K. Tait, Sr. himself passed away on December
24, 1977. From 1982 to 1983, Maria F. Tait sold lots included
within the Sum-at property in favor of private respondents
Eduard Okoren, Gregorio Acoking, Evelyn Saclangan, Mary
Atiwag, Jaime T. Fronda, Barbara Tallongen, Julia Piyes, Glen
Paquito, and Felicitas Alinao. Private respondents purchased
the lots on the strength of a Tax Declaration over the Sum-at
property showing the seller, Maria F. Tait, to be the owner of
the property in question and thereafter planted different
kinds of fruit trees and plants on the lots purchased by them.
On July 24, 1989, petitioners Emilie T. Sumbad and
Beatrice B. Tait brought an action for quieting of title,
nullification of deeds of sale, and recovery of possession
with damages against private respondents. They alleged
that they are the children and compulsory heirs of the
spouses George K. Tait, Sr. and Agata B. Tait of Bondoc,
Mountain Province; that said spouses died on December 24,
1977 and April 30, 1936, respectively; that said spouses
owned real property in Otucan, Bauko, Mountain Province;
and that after the death of their mother, their father George
K. Tait, Sr. sold the Otucan property and used the proceeds
thereof to purchase a residential lot in Sum-at, Bontoc,
Mountain Province.
Petitioners further alleged that from 1982 to 1983,
Maria F. Tait, without their knowledge and consent, sold lots
included within the Sum-at property to private respondents;
that prior to the sales transactions, private respondents
were warned that the Sum-at property did not belong to
Maria F. Tait but to the heirs of George K. Tait, Sr.; that this
notwithstanding, private respondents proceeded to purchase
the lots in question from Maria F. Tait; that Maria F. Tait had
no right to sell the Sum-at property; that the deeds of sale
are null and void and did not transfer title to private
respondents; that petitioners discovered the transactions
only in 1988 but, as soon as they learned of the same, they
lost no time in communicating with private respondents; and
that private respondents refused petitioners request for a
meeting, leaving the latter no other alternative but to file
the case in court.
Private respondents moved to dismiss the complaint,
but their motion was denied by the trial court in its Order,
dated September 26, 1989.[3] They then filed their answer in
which they denied they had been informed of petitioners
claim of ownership of the lots. They also denied that
petitioners learned of the sales to them only in 1988. They
alleged that the Sum-at property, covered by Tax Declaration
No. 399, did not belong to the conjugal partnership of
George K. Tait, Sr. and Agata B. Tait for the reason that the
latter died more than thirty (30) years before the issuance of
Tax Declaration No. 399 in 1973; that the late Maria F. Tait,
second wife of George K. Tait, Sr., did not need the consent
of petitioners to be able to sell the Sum-at property to
private respondents; that private respondents were
purchasers in good faith and for value; that the action was
barred by laches; that they were in possession of the lots
and had introduced improvements thereon; and that they
had separate tax declarations covering their respective
lots. As a compulsory counterclaim, private respondents
prayed that petitioners be ordered to pay P10,000.00 as
moral damages, P2,000 as attorneys fees to each private
respondent, the appearance fees, and costs.

On November 21, 1989, the trial court issued a pre-trial


order stating the parties stipulation of facts, as well as the
factual and legal issues, as follows:
B. Stipulations or Admissions of the Parties:
1. Plaintiffs admit the following:
a. That Agata Banagui Tait died on April 30, 1936;
b. That the property in issue was bought by George Tait after
the death of Agata Banagui Tait;
c. That a deed of donation was executed by George Tait in
favor of Maria with the land in dispute as the subject matter
thereof;
d. That deeds of sale of the property in question were
executed in favor of the defendants by Maria Tait in 1984;
e. That Maria Tait died in 1988.
2. . . . .
C. Issues Involved:
1. Factual:
a. Whether or not George Tait and Agata Banagui Tait owned
and sold a lot at Otucan, Bauko, Mt. Province and the
proceeds thereof used in buying the property in dispute;
b. Whether or not Maria Tait sold the lot in issue to the
defendants without the knowledge of the plaintiffs;
c. Whether or not defendants before buying the land were
forewarned of its controversial status;
d. Whether or not plaintiffs only recently discovered the sale
made by Maria Tait to the defendants.
1. Legal:
a. Whether or not plaintiffs are the compulsory heirs of the
deceased George Tait and Agata Banagui Tait;
b. Whether or not the property covered by TD 399 and the
subject hereof was owned by George Tait and Agata Banaga
Tait;
c. Whether or not the deed of donation executed by George
Tait in favor of Maria Tait is valid and effective;
d. Whether or not the sale made by Maria Tait to the
defendants is valid and effective;
e. Whether or not defendants are buyers in good faith;
f. Whether or not laches barred the claim of the plaintiffs. [4]
Realizing that the pre-trial order included their
admission that a deed of donation was executed by George
K. Tait, Sr. in favor of Maria F. Tait of the Sum-at property,
petitioners subsequently moved for the inclusion as one of
the factual issues the alleged forgery of the deed of
donation. The Court did not act on petitioners
motion. However, petitioners were allowed to present
evidence on the alleged forgery without objection by the
private respondents.
On April 3, 1990, the trial court, on motion of
petitioners, authorized the clerk of court of the Municipal
Trial Court in Cities, Baguio City to take the deposition of one
of petitioners witnesses, Shirley Eillinger.

During the trial, petitioners presented the following as


witnesses: Beatrice B. Tait, Dalino Pio, Rosita Aclipen, and
Atty. Angela D. Papa.
Petitioner Beatrice B. Tait, a 60-year-old missionary
nun and resident of Capangan, Benguet, testified that she
and co-plaintiff Emilie T. Sumbad are sisters; that their
parents are George K. Tait, Sr. and Agata B. Sumbad; that
the late Maria F. Tait was their stepmother; that Maria F. Tait
became their stepmother some time in 1941; that her
parents had a property in Sum-at but it was sold; that her
parents had a property in Otucan; and that she did not know
what happened to the said property although she thought
that her parents sold it in order to purchase the Sum-at
property.[5]
On cross-examination, petitioner Beatrice Tait testified
that her mother, Agata B. Tait, died in 1936; that she lived
with her parents in Otucan from 1940 to 1941; and that the
house at Sum-at was occupied by her grandmother (her
stepmothers mother).[6]
Dalino Pio, a 60 year-old farmer and resident of
Payag-eo, testified that Agata B. Tait was her sister and
George K. Tait, Sr. was the latters husband; that George K.
Tait, Sr. and Agata B. Tait lived in Otucan; that Agata B. Tait
inherited the Otucan property from their father; that George
K. Tait moved to Bontoc at a place near the market; and that
the spouses sold the Otucan property and afterwards
purchased the Sum-at property.[7]
On cross-examination, Dalino Pio said that at the time
that George K. Tait, Sr. sold the Otucan property, Agata B.
Tait was already dead; that she does not know Maria F. Tait;
that she did not personally see the Sum-at property; and
that her sole basis for saying that George K. Tait, Sr. had
used the proceeds of the sale of the Otucan property to
purchase the property at Sum-at was what George K. Tait
related to her.[8]
Lanoy Takayeng, a farmer, testified that she knew the
late George K. Tait, Sr.; that she also knew someone named
Fani-is; that George K. Tait, Sr. gave money to Fani-is for the
purchase of the Sum-at property; that she does not know the
exact amount given by George K. Tait, Sr. to Fani-is; that also
present during that meeting were three (3) other persons
named Samoki, Amok, and Aclipen; and that George K. Tait,
Sr. afterwards planted coffee and orange trees on the Sumat property and built a house thereon.[9]
On cross-examination, Lanoy Takayeng testified that
George K. Tait, Sr. was her uncle; that when George K. Tait,
Sr. acquired the Sum-at property, he was already married to
Maria F. Tait; and that the money used to purchase the Sumat property came from the proceeds of the sale of the house
at Bauko.[10] She testified that George K. Tait, Sr. was an
educated man and a former member of Congress.[11]
Rosita Aclipen, a 48-year-old housewife and resident
of Bontoc, testified that she knew the private respondents;
that she sent a letter to private respondents on May 30,
1989; that she was instructed by petitioners to send the
letter to private respondents; and that the letter was
prepared and signed by petitioners lawyer.[12]
Atty. Angela D. Papa testified that she had been the
register of deeds of Bontoc since February 16, 1987; that as
such, she was in charge of keeping records of all documents
relating to the registration of real property, instruments, and
mortgages; that she did not recall receiving a letter from
Emilie T. Sumbad; and that she issued a certification,
marked as Exhibit F, to the effect that no deeds of sale
between Maria F. Tait and Acoking, Arthur Atiwag, Blanza,
Glenn Paquito, Jaime Fronda, and Lolita Tolentino were
registered in her office.[13]
For their documentary evidence, petitioners presented
tax declarations covering the Sum-at property in the name
of George K. Tait, Sr.; a certification showing payment of real
estate taxes made by George K. Tait, Sr. on the property;
official receipts; a certification by the register of deeds of
Bontoc that no deed of sale covering the Sum-at property

was registered in her office; a copy of the deed of donation,


dated April 2, 1974; a letter, dated May 30, 1989, addressed
to private respondents; and the transcripts of the deposition
of Shirley Eillenger.[14]
In her deposition, Shirley Eillinger stated that she knew
Beatrice B. Tait and Emilie T. Sumbad, daughters of the late
George K. Tait, Sr.; that she personally knew George K. Tait,
Sr.; that she also knew a person named Raquel Tait who had
been her boardmate at the Perpetual Help Dormitory in
Baguio City when the witness was in the third year of her
college education; that Raquel Tait was George K. Tait, Sr.s
ward; that she saw a Deed of Donation regarding the Sum-at
property and other documents containing the signature of
George K. Tait, Sr.; and that she was able to read the
contents of the Deed of Donation. She identified Exhibit I as
a carbon copy of the document she referred to. She further
testified that in 1979 or 1980 she saw Raquel type the Deed
of Donation at the Perpetual Help Dormitory; that George K.
Tait, Sr. was already dead at that time, having died in 1976
when the witness was a third year high school student; that
she saw Raquel Tait forge the signature of George K. Tait, Sr.
on a piece of paper; that Raquel herself at first tried to copy
the signature of George K. Tait, Sr. on the paper then asked
other male boarders to copy the signature of George K. Tait,
Sr.; that she told Raquel Tait that it was wrong to forge the
signature of any person but Raquel Tait ignored her and told
her to keep quiet; that Raquel Tait personally signed the
Deed of Donation; that Raquel Tait also tried to forge the
signature of Maria Tait; that she did not see Raquel Tait put
Maria Taits signature on the document but only saw Raquel
Tait forge Maria Taits signature on a piece of paper; and that
the following day, Raquel Tait went to Bontoc bringing with
her the Deed of Donation.[15]
On cross-examination, this witness stated that it took
Raquel about 20 to 30 minutes to type the Deed of
Donation; that Raquel Tait had a form from which she copied
the Deed of Donation; that Raquel Tait did not refer to a tax
declaration in preparing the Deed of Donation; and that it
took the male boarders the entire morning, from 8 oclock
until 11 oclock, to copy the signature of George K. Tait, Sr.[16]
On the other hand, private respondents presented the
following witnesses: Felipa Piyes, Julio Saclangen, Glenn
Paquito, and Edward Okoren.
Felipa Piyes, a 61-year old businesswoman and
resident of Loc-ong, Bontoc, testified that her son is one of
the lot purchasers of the Sum-at property; that Rosita
Aclipen called for her and demanded additional payment for
the lot purchased by her son; that she asked Rosita Aclipen
why additional payment was being demanded when the
price of the lot had already been fully paid to Maria F. Tait;
that Emilie T. Sumbad was also present when Rosita Aclipen
demanded money from her; and that Emilie T. Sumbad is the
stepdaughter of Maria F. Tait.[17]
On cross-examination, Felipa Piyes narrated that it was
her son, Edward Piyes, who provided the money for the
purchase of the Sum-at lot; that she received a letter some
time in May or June, 1989 from Rosita Aclipen; that she
affixed her signature on the letter; that during that time,
Edward, who was in Saudi Arabia, told her to purchase the
lot for as long as there was no controversy over the same;
that Mrs. Tait had a tax declaration under her name and on
the faith thereof, she purchased the lot from Maria F. Tait;
that a deed of sale was executed between Maria F. Tait and
Julia Piyes, her daughter-in-law, as purchaser; that as a
resident of Bontoc, she knew George K. Tait, Sr. and Maria F.
Tait; that George K. Tait, Sr. was formerly a congressman for
the Mountain Province; that George K. Tait, Sr. and Maria F.
Tait lived together as husband and wife but did not have any
children; and that she knew that the petitioners are
stepdaughters of Maria F. Tait.[18]
Julio Saclangen, a resident of Omfeg, testified that a
deed of sale was also executed between him and his wife
Evelyn Saclangen, on the one hand, and Maria F. Tait, on the
other; that from the records of the municipal office, they
verified that Maria F. Tait was the owner of the Sum-at
property; that they also verified from other lot purchasers
that Maria F. Tait is the real owner of the property; that after

purchasing the lot, they planted camote and banana on the


lot; and that he and his wife caused the issuance of a tax
declaration in their name.[19]
Glenn Paquito, 48 years old and a resident of
Chakchakan, Bontoc, claimed that upon learning that lots
were being offered for sale in Sum-at, he verified from the
municipal assessors office that the Sum-at property was
owned by Maria F. Tait; that he had a tax declaration
covering the lot purchased from Maria F. Tait; that he planted
camote and papaya on the lot; that he had been paying real
estate taxes on the lot from the time he purchased it; and
that since acquiring the lot he had never been disturbed in
his possession.[20] On cross-examination, he revealed that he
also received a letter, dated May 30, 1989, from the
petitioners representatives; that after receiving the letter, a
conference was held between the parties at the house of
Rosita Aclipen wherein the latter asked the purchasers for
additional payment for the purchased lots; that aside from
them, other lot purchasers were present at the conference;
and that upon investigation in the municipal assessors
office, he was only shown one tax declaration and did not
ask to be shown previous tax declarations on the Sum-at
property.[21]
Edward Okoren, a 46-year-old teacher and resident of
Guina-ang, Bontoc, testified that he purchased a lot from
Maria F. Tait; that he had a tax declaration covering the lot in
his name; that the deed of sale was registered with the
Register of Deeds of Bontoc, Mountain Province; that after
purchasing the lot, he planted camote and constructed a
stone wall thereon; that he had never been disturbed in his
possession until the present; that he paid real estate taxes
on the lot; and that he was asked to attend a conference
with petitioners but he declined because he was busy. [22]
Private respondents presented copies of the deeds of
sale executed in their favor by Maria F. Tait as documentary
evidence.
On April 8, 1991, the trial court rendered judgment
dismissing the complaint. The dispositive portion provides as
follows:
WHEREFORE, decision is hereby rendered dismissing the
instant action and ordering the plaintiffs to pay each of the
defendants herein P500.00 by way of attorneys fees and
litigation expenses.
Costs against plaintiffs.
SO ORDERED.[23]
On appeal, the Court of Appeals affirmed the trial
courts decision with the modification that the award of
attorneys fees was set aside.[24] Hence, this petition.
Petitioners assign the following errors as having been
allegedly committed by the appellate court:
1. THE HONORABLE COURT OF APPEALS ERRED IN NOT
DECLARING THE DEED OF DONATION INTER VIVOS IN FAVOR
OF MARIA TAIT AS NULL AND VOID;

5. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED


IN FINDING THAT THE LATE MARIA FAS-ANG TAIT HAD THE
AUTHORITY TO DISPOSE OF THE LAND IN CONTROVERSY,
NOTWITHSTANDING THE FACT THAT IT DID NOT BELONG TO
HER AND THE FACT THAT THE ALLEGED DEED OF DONATION
IN HER FAVOR IS A FORGERY AND VOID AB INITIO;
6. THE HONORABLE COURT OF APPEALS ERRED IN FINDING
THAT THE DEFENDANTS OWNERSHIP OF THE LOTS
(UNLAWFULLY) SOLD TO THEM, NOTWITHSTANDING THE
FACT THAT THE SELLER DID NOT HAVE THE RIGHT OR
AUTHORITY TO DO SO;
7. THE HONORABLE COURT OF APPEALS ERRED IN FINDING
THAT THE DEFENDANTS HAVE THE BETTER RIGHT TO
POSSESS THE PREMISES IN QUESTION;
8. THE HONORABLE COURT OF APPEALS ERRED IN FINDING
THAT THE PLAINTIFFS-PETITIONERS FAILED TO PROVE THEIR
RIGHT OF SUCCESSION TO THE PROPERTY IN QUESTION;
9. THE HONORABLE COURT OF APPEALS ERRED IN FINDING
THAT PLAINTIFFS HAVE NO TITLE, LEGAL OWNERSHIP OR
EQUITABLE, TO THE PROPERTY IN QUESTION;
10. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED
IN FINDING THAT THE ACTION IS BARRED BY LACHES.[25]
Petitioners contend that the deed of donation, dated
April 2, 1974, is void for the following reasons: (1) it is a
forgery; (2) it was made in violation of Art. 133 of the Civil
Code, now Art. 87 of the Family Code; and (3) it was
notarized by a person who had no authority to act as a
notary public. They further contend that Maria F. Tait had no
authority to sell the Sum-at property and, therefore, the
sales in favor of private respondents are null and void; that
as heirs of George K. Tait, they are entitled to the Sum-at
property; and that since they only learned of the sales
transactions sometime in 1988 when Maria F. Tait became
seriously ill, they are not barred from bringing the present
action.
The petition has no merit. It is settled that factual
findings of the trial court will not be disturbed on appeal
unless the court has overlooked or ignored some fact or
circumstance of sufficient weight or significance, which, if
considered, would alter the result of the case. [26] When there
is no conflict between the findings of the trial and appellate
courts, a review of the facts found by the appellate court is
unnecessary.[27] In the case at bar, even a review of the
evidence fails to yield any reason for us to disregard the
factual findings of the trial court and the appellate court.
First. Petitioners fault both the trial and appellate
courts for not giving credence to the testimony of Shirley
Eillenger with respect to the forgery of the deed of donation.
As the Court of Appeals ruled, however:
The plaintiffs assail the validity of the deed of donation in
question on the ground that it is a forgery. On this point, the
plaintiffs presented a witness who testified in a deposition
taken before the Clerk of Court of the Municipal Trial Court in
Baguio City on April 11, 1990 a certain Shirley Eillenger.

2. THE HONORABLE COURT OF APPEALS ERRED IN NOT


DECLARING THE DEEDS OF SALE TO THE DEFENDANTS AS
NULL AND VOID IT HAVING ORIGINATED FROM A VOID
DOCUMENT AND TRANSACTION;

....

3. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED


IN NOT APPLYING ART. 133, NEW CIVIL CODE, (NOW ART. 87,
FAMILY CODE) AND ART. 749 OF THE NEW CIVIL CODE IN THE
ABOVE-ENTITLED CASE;

. . . Anent the deed of donation inter vivos the validity of


which is put in issue by plaintiffs, the deposition of Shirley
Eillenger to the effect that she personally saw one Raquel
Tait draft the document and forge the signature of George K.
Tait now appearing therein is incredible and grossly
unconvincing. For considerations difficult to pin down, the
statements of the witness on the point somehow does not
ring true and appear to have been rehearsed. It is too pat to
be credible.

4. THE HONORABLE COURT OF APPEALS ERRED IN NOT


APPRECIATING THE STRAIGHTFORWARD AND CATEGORICAL
DECLARATIONS OF SHIRLEY EILLENGER REGARDING THE
FORGERY OF THE DONATION INTER VIVOS;

Remarking on this testimony of Shirley Eillenger, the trial


court had said:

We agree with the lower court when it said that this


testimony of Eillenger is vague and incredible. We have
studied with care the deed of donation in question and find
unworthy of credence the claim of Eillenger that Raquel Tait,
who must have been a young girl about 20 years of age in
1979 or 1980 (she gave her age as 30 on April 11, 1990),
could have, in 20 to 30 minutes, prepared the document in
all its legal form supposedly copying only from a format. It
also taxes the mind to believe that Raquel Tait had called the
boys in the boarding house and, within the view of every
one, asked them to forge the signature of George K. Tait, Sr.
and, with the boys failing to accomplish the task, herself
forged the signature not only of George K. Tait, Sr. but also of
Maria Tait in that one sitting and in that short span of time.
The alleged forgery could have been proven with more
competent evidence, such as by handwriting experts. This,
the plaintiffs failed to do. As stated by the trial court, the
validity of the public document cannot be impugned or
overcome by the testimony of the witness Eillenger. [28]
Forgery should be proved by clear and convincing
evidence, and whoever alleges it has the burden of proving
the same.[29] Not only is Shirley Eillengers testimony difficult
to believe, it shows it had been rehearsed as she anticipated
the questions of petitioners counsel, and sometimes said
more than was called for by the question. This is illustrated
by the following portions of her testimony:
Q When you were boardmates with Raquel Tait at
Perpetual Help, along Gen. Luna, Baguio City, do
you recall if you have seen any document regarding
that Sum-at property of George Tait, Sr.?
A Yes, sir, I saw it.
Q And, what document is that if you could still recall?
A I saw a Deed of Donation... and other documents
where the signature of George Tait, Sr. was written.
ATTY. SOKOKEN:
There was an Ilocano word.
ATTY. LOCKEY:
May we put it in Ilocano?
WITNESS:
A Ania daguidiay nga documento tattayen?
ATTY. LOCKEY:
Q You mentioned about a Deed of Donation. Were you
able to read or see that Deed of Donation?
A Yes, sir.
Q I have here a duplicate original of a Deed of Donation
Intervivos dated April 2, 1974. Will you go over that
document?
HEARING OFFICER:
Witness is going over the document handed to her by
counsel.
ATTY. LOCKEY:
Q Have you gone over the document?
A Yes, sir.
Q What relation has that document to the Deed of
Donation which you claim to have been typewritten

by Raquel Tait in your boardinghouse at Perpetual


Help, along Gen. Luna, Baguio City?
A It was the carbon copy of the Deed of Donation that
Raquel Tait typed in our boardinghouse.
Q By the way, Mrs. Witness, what year was that when
you saw Raquel Tait typewriting the Deed of
Donation, if you could still recall?
A As far as I can recall, it was in the year 1979 to 1980.
Q And, at that time, do you recall where George Tait, Sr.
was?
A George Tait, Sr. is already dead during that time.
Q When did George Tait, Sr. die, if you could still recall?
A As far as I can recall, he died in the year 1976 when I
was in 3rd year high school.
Q Going back to the Deed of Donation which you have
just identified, what was the condition of this
document to that Deed you saw being typewritten
by Raquel Tait?
ATTY. SOKOKEN:
May we interpose an objection? The question maybe
ambiguous insofar as to the condition of the
document when it was typed.
ATTY. LOCKEY:
We will reform the question, your Honor.
Q I noticed that in this Deed of Donation there are
written entries as well as signatures. At the time
you saw this Deed of Donation being typewritten by
Raquel Tait, were the written entries and signatures
already there?
A The signatures were not yet there when Raquel Tait
typed this Deed of Donation. However, the
following day ....
ATTY. SOKOKEN:
May we request that the question be just answered.
HEARING OFFICER:
Make it of record that there is an objection of the
defendants counsel, asking that the deponent will
only answer the question asked.
....
ATTY. LOCKEY:
Q After seeing the document already marked as Exh. I
being typewritten by Raquel Tait, was there any
occasion wherein you have seen again that
document aside from todays hearing?
WITNESS:
A Yes, sir.
Q When was that, if you can still recall?
A Last April.
ATTY. SOKOKEN:

May I manifest, Mr. Hearing Officer, that the witness is


taking time to remember the answer.
HEARING OFFICER:

HEARING OFFICER:
Make it of record also that the witness made use of the
word kalokohan in Filipino language. Let that term
be put on record.

Make that of record.


ATTY. LOCKEY:
WITNESS:
A April 6, 1990.

Q And, what did Raquel Tait tell you, if any, in connection


with your comment?

ATTY. LOCKEY:

A She said I will just keep quiet.

Q Whereat?

Q What else did Raquel Tait do in connection with the


Deed of Donation you have earlier identified aside
from what you have already stated, if any?

A At the office of Atty. Lockey.


Q And how come that you went there in the office of Atty.
Lockey on April 6, 1990?
A Atty. Lockey asked for me to go there.
Q Do you know for what purpose that you were asked to
go there?
A Yes, sir.
Q Please tell the Court.

A She personally signed this one.


HEARING OFFICER:
Witness pointing to the document earlier marked as Exh.
I particularly to the signature above the typewritten
name George K. Tait, Donor.
ATTY. LOCKEY:
Perhaps it would not be remiss for us to say that the
signature pointed to by the witness be encircled
and be marked as Exh. I-1.

A To inquire about that Deed of Donation.


HEARING OFFICER:
Q And was there really an inquiry about what was done
or made in the Office of Atty. Lockey regarding that
Deed of Donation?
A Yes, sir.
....
ATTY. LOCKEY:
Q What else did Raquel Tait do, if any, after typewriting
that Deed of Donation in your boardinghouse at
Perpetual Help?
WITNESS:
A I saw her forging the signature of George Tait, Sr. on a
piece of bond paper.
Q And how did you see her forging the signature of
George Tait, sr. on that bond paper?
A I saw her try to copy the signature of George Tait, Sr.
and calling some boys, our boardmates, to copy the
signature of George Tait, Sr. in that bond paper also.
Q From where was Raquel Tait copying the signature of
George Tait, Sr.?
A In a separate document.
Q You said that Raquel Tait was also requiring the boys to
copy. Did the boys accede to the request of Raquel
Tait?
A Some boys tried to forge it, but they did not follow it.
Q Seeing this situation meaning Raquel Tait trying to
forge the signature of George Tait, what step or
steps did you take, if any?
A I warned her by saying that she is making kalokohan
out of that Deed of Donation.

Mark it.
ATTY. LOCKEY:
Q Aside from that, what else did she do, if any?
A She wants to try to forge the signature of Maria Tait.
Q Was she able to do it?
A Yes, sir.[30]
Petitioners should have presented handwriting experts
to support their claim that George K. Tait, Sr.s signature on
the deed of donation was indeed a forgery.
Second. Petitioners argue that the deed of donation is
invalid under Art. 749 of the Civil Code, which requires a
public instrument as a requisite for the validity of donations
of immovable property. They contend that the person who
notarized the deed had no authority to do so. However,
petitioners have not shown this to be the case. The
acknowledgment clause states that the person who
notarized it was the deputy clerk of court, Gonzalo Reyes,
who acted For and in the absence of the Clerk of Court. Sec.
21 of the Revised Administrative Code of 1917, as amended
by C.A. Nos. 270 and 641, provides:
SEC. 21. Officials authorized to administer oaths. The
following officers have general authority to administer oaths,
to wit:
Notaries public; justices of the peace and auxiliary justices of
the peace; clerks of court; the Secretary of the National
Assembly; bureau directors; registers of deeds; provincial
governors and lieutenant-governors; city mayors; municipal
mayors, municipal district mayors; any other officer in the
Philippine service whose appointment is vested in the
President of the Philippines, Secretary of War, or President of
the United States. A person who by authority of law shall act
in the capacity of the officers mentioned above shall possess
the same power. (Emphasis added).[31]

In accordance with the presumption that official duty


has been regularly performed, it is to be presumed that the
deputy clerk of court who notarized the deed of donation in
this case was duly authorized by the clerk of court.

In sum, petitioners have not sufficiently shown the


nullity of private respondents title to the lots purchased by
them. To the contrary, as the Court of Appeals well
observed:

Third. Petitioners argue that the deed of donation


contravenes Art. 133 of the Civil Code which provides:

The deed of donation in question was executed by their


father in 1974. Assuming that the plaintiffs were not aware
of the existence of said document, as they now claim, they
could not have failed to notice that the land in question had
been occupied by Maria F. Tait and later by defendants who
bought portions thereof and that said defendants,
numbering nine (9), and their families, had built their
respective houses and introduced other improvements on
the portions they had purchased from Maria F. Tait and had
resided therein since 1982 and 1983. As stated by the trial
court, the plaintiffs offered no plausible excuse for their
failure to assert their rights sooner. They apparently waited
until Maria F. Tait died in 1988 before assailing the validity of
the sales made by the latter in favor of the defendants.

Art. 133. Every donation between the spouses during the


marriage shall be void. This prohibition does not apply when
the donation takes effect after the death of the donor.
Neither does this prohibition apply to moderate gifts which
the spouses may give each other on the occasion of any
family rejoicing.
in view of our ruling in Matabuena v. Cervantes[32] that the
prohibition in Art. 133 extends to common-law relations.
Indeed, it is now provided in Art. 87 of the Family Code:
Art. 87. Every donation or grant of gratuitous advantage,
direct or indirect between the spouses during the marriage
shall be void, except moderate gifts which the spouses may
give each other on the occasion of any family rejoicing. The
prohibition shall apply to persons living together as husband
and wife without a valid marriage. (Emphasis added).
This point is being raised for the first time in this
Court. The records show that in the trial court, petitioners
attack on the validity of the deed of donation centered solely
on the allegation that George K. Tait, Sr.s signature had been
forged and that the person who notarized the deed had no
authority to do so. But petitioners never invoked Art. 133 of
the Civil Code as a ground to invalidate the deed of
donation.
Time and again, this Court has ruled that litigants
cannot raise an issue for the first time on appeal as this
would contravene the basic rules of fair play and
justice. Even assuming that they are not thus precluded,
petitioners were unable to present evidence in support of
such a claim. The evidence on record does not show whether
George K. Tait, Sr. was married to Maria F. Tait and, if so,
when the marriage took place. If, as petitioners claim, Maria
F. Tait was not married to their father, evidence should have
been presented to show that at the time the deed of
donation was executed, their father and Maria F. Tait were
still maintaining common-law relations. Beatrice Taits
testimony is only to the effect that in 1941 Maria F. Tait
became their stepmother. There is no evidence on record
that George K. Tait, Sr. and Maria F. Tait continuously
maintained common-law relations until April 2, 1974 when
the donation was made.
Fourth. Petitioners claim that they only learned of the
sales to private respondents of lots included in the Sum-at
property in 1988 when they visited Maria F. Tait in Bontoc
because she was seriously ill.As admitted by petitioners,
their mother, Agata B. Tait, died on April 30, 1936, while
their father, George K. Tait, Sr., died on December 24, 1977.
[33]
Yet, petitioners waited for twelve (12) years before
claiming their inheritance, having brought their present
action only on July 24, 1989. Petitioners are thus guilty of
laches which precludes them from assailing the donation
made by their father in favor of Maria F. Tait. Laches is the
failure or neglect for an unreasonable length of time to do
that which, by exerting due diligence, could or should have
been done earlier.[34]
Finally, Lanoy Takayengs testimony that George K. Tait,
Sr. gave Fani-is money to purchase the Sum-at property does
not necessarily mean that the money came from the
proceeds of the sale of the Otucan property. For one, Lanoy
Takayeng could not state with certainty when the alleged
meeting took place. Second, this witness could not even
remember the amount of money allegedly given by George
K. Tait, Sr. to Fani-is. Third, Takayeng did not state when the
purchase supposedly took place or if the sale was
consummated in accordance with George K. Tait, Sr.s
instructions. It is anybodys guess whether George K. Taits
orders were carried out by Fani-is and whether George K.
Tait, Sr. tapped other funds to purchase the Sum-at property.

We believe that the defendants herein bought their


respective portions they now possess in good faith. The land
is not registered under the Torrens system and they checked
with the Assessors Office and found that the same was
declared in the name of Maria F. Tait. Further, it was the said
Maria F. Tait and not the plaintiffs who was in possession
thereof. The claim of the plaintiffs that the defendants were
forewarned [prior to the sales transactions] that the property
was not owned by Maria F. Tait but by the heirs of George K.
Tait, Sr. was not proven in these proceedings.
Indeed, the plaintiffs have failed in the duty to prove their
allegations in their complaint as required by the Rules of
Court. We find their evidence too inadequate to be
considered as preponderantly in their favor.
In fine, there is no reason for this Court to set aside the
findings of the trial court, except insofar as it orders the
plaintiffs to pay the defendants attorneys fees. As aptly
pointed out by the plaintiffs-appellants there should be no
premium on the right to litigate. We find that the plaintiffs
filed this complaint in good faith and that the defendants
claim for attorneys fees was not adequately established.
WHEREFORE, the decision of the Court of Appeals is
AFFIRMED.
SO ORDERED.

G.R. No. 165879

November 10, 2006

MARIA B. CHING, Petitioner,


vs.
JOSEPH C. GOYANKO, JR., EVELYN GOYANKO, JERRY
GOYANKO, IMELDA GOYANKO, JULIUS GOYANKO, MARY
ELLEN GOYANKO AND JESS GOYANKO, Respondents.
DECISION
CARPIO MORALES, J.:
On December 30, 1947, Joseph Goyanko (Goyanko) and
Epifania dela Cruz (Epifania) were married.1 Out of the union
were born respondents Joseph, Jr., Evelyn, Jerry, Imelda,
Julius, Mary Ellen and Jess, all surnamed Goyanko.
Respondents claim that in 1961, their parents acquired a
661 square meter property located at 29 F. Cabahug St.,
Cebu City but that as they (the parents) were Chinese
citizens at the time, the property was registered in the name
of their aunt, Sulpicia Ventura (Sulpicia).
On May 1, 1993, Sulpicia executed a deed of sale2 over the
property in favor of respondents father Goyanko. In turn,
Goyanko executed on October 12, 1993 a deed of sale 3 over
the property in favor of his common-law-wife-herein
petitioner Maria B. Ching. Transfer Certificate of Title (TCT)
No. 138405 was thus issued in petitioners name.

After Goyankos death on March 11, 1996, respondents


discovered that ownership of the property had already been
transferred in the name of petitioner. Respondents
thereupon had the purported signature of their father in the
deed of sale verified by the Philippine National Police Crime
Laboratory which found the same to be a forgery. 4

2. . . . when it dismissed the complaint a quo . . . , in


effect, sustaining the sale of the subject property between
Joseph, Sr. and the defendant-appellee, despite the fact
that the marriage of Joseph, Sr. and Epifania was then still
subsisting thereby rendering the subject property as
conjugal property of Joseph, Sr. and Epifania.

Respondents thus filed with the Regional Trial Court of Cebu


City a complaint for recovery of property and damages
against petitioner, praying for the nullification of the deed of
sale and of TCT No. 138405 and the issuance of a new one in
favor of their father Goyanko.

3. . . . in dismissing the complaint a quo . . . , in effect,


sustaining the validity of the sale of the subject property
between Joseph, Sr. and the defendant-appellee, despite
the clear findings of forgery and the non-credible
testimony of notary public.7

In defense, petitioner claimed that she is the actual owner of


the property as it was she who provided its purchase price.
To disprove that Goyankos signature in the questioned deed
of sale is a forgery, she presented as witness the notary
public who testified that Goyanko appeared and signed the
document in his presence.

By Decision dated October 21, 2003,8 the appellate court


reversed that of the trial court and declared null and void
the questioned deed of sale and TCT No. 138405. Held the
appellate court:

By Decision of October 16, 1998,5 the trial court dismissed


the complaint against petitioner, the pertinent portions of
which decision read:
There is no valid and sufficient ground to declare the sale as
null and void, fictitious and simulated. The signature on the
questioned Deed of Sale is genuine. The testimony of Atty.
Salvador Barrameda who declared in court that Joseph
Goyanko, Sr. and Maria Ching together with their witnesses
appeared before him for notarization of Deed of Sale in
question is more reliable than the conflicting testimonies of
the two document examiners. Defendant Maria Ching
asserted that the Deed of Sale executed by Joseph Goyanko,
Sr. in her favor is valid and genuine. The signature of Joseph
Goyanko, Sr. in the questioned Deed of Absolute Sale is
genuine as it was duly executed and signed by Joseph
Goyanko, Sr. himself.
The parcel of lands known as Lot No. 6 which is sought to be
recovered in this case could never be considered as the
conjugal property of the original Spouses Joseph C. Goyanko
and Epifania dela Cruz or the exclusive capital property of
the husband. The acquisition of the said property by
defendant Maria Ching is well-elicited from the
aforementioned testimonial and documentary evidence
presented by the defendant. Although for a time being the
property passed through Joseph Goyanko, Sr. as a buyer yet
his ownership was only temporary and transitory for the
reason that it was subsequently sold to herein defendant
Maria Ching. Maria Ching claimed that it was even her
money which was used by Joseph Goyanko, Sr. in the
purchase of the land and so it was eventually sold to her. In
her testimony, defendant Ching justified her financial
capability to buy the land for herself. The transaction
undertaken was from the original owner Sulpicia Ventura to
Joseph Goyanko, Sr. and then from Joesph Goyanko, Sr. to
herein defendant Maria Ching.
The land subject of the litigation is already registered in the
name of defendant Maria Ching under TCT No. 138405. By
virtue of the Deed of Sale executed in favor of Maria Ching,
Transfer Certificate of Title No. 138405 was issued in her
favor. In recognition of the proverbial virtuality of a Torrens
title, it has been repeatedly held that, unless bad faith can
be established on the part of the person appearing as owner
on the certificate of title, there is no other owner than that in
whose favor it has been issued. A Torrens title is not subject
to collateral attack. It is a well-known doctrine that a Torrens
title, as a rule, is irrevocable and indefeasible, and the duty
of the court is to see to it that this title is maintained and
respected unless challenged in a direct proceedings
[sic].6(Citations omitted; underscoring supplied)
Before the Court of Appeals where respondents appealed,
they argued that the trial court erred:
1. . . . when it dismissed the complaint a quo . . . , in
effect, sustaining the sale of the subject property between
Joseph, Sr. and the defendant-appellee, despite the
proliferation in the records and admissions by both parties
that defendant-appellee was the "mistress" or "commonlaw wife" of Joseph, Sr..

. . . The subject property having been acquired during the


existence of a valid marriage between Joseph Sr. and
Epifania dela Cruz-Goyanko, is presumed to belong to the
conjugal partnership. Moreover, while this presumption in
favor of conjugality is rebuttable with clear and convincing
proof to the contrary, we find no evidence on record to
conclude otherwise. The record shows that while Joseph Sr.
and his wife Epifania have been estranged for years and that
he and defendant-appellant Maria Ching, have in fact been
living together as common-law husband and wife, there has
never been a judicial decree declaring the dissolution of his
marriage to Epifania nor their conjugal partnership. It is
therefore undeniable that the 661-square meter property
located at No. 29 F. Cabahug Street, Cebu City belongs to
the conjugal partnership.
Even if we were to assume that the subject property was not
conjugal, still we cannot sustain the validity of the sale of
the property by Joseph, Sr. to defendant-appellant Maria
Ching, there being overwhelming evidence on records
that they have been living together as common-law husband
and wife. On this score, Art. 1352 of the Civil Code provides:
"Art. 1352. Contracts without cause, or with unlawful cause,
produce no effect whatsoever. The cause is unlawful if it is
contrary to law, morals, good customs, public order or public
policy."
We therefore find that the contract of sale in favor of the
defendant-appellant Maria Ching was null and void for being
contrary to morals and public policy. The purported sale,
having been made by Joseph Sr. in favor of his concubine,
undermines the stability of the family, a basic social
institution which public policy vigilantly protects.
Furthermore, the law emphatically prohibits spouses from
selling property to each other, subject to certain exceptions.
And this is so because transfers or conveyances between
spouses, if allowed during the marriage would destroy the
system of conjugal partnership, a basic policy in civil law.
The prohibition was designed to prevent the exercise of
undue influence by one spouse over the other and is likewise
applicable even to common-law relationships otherwise, "the
condition of those who incurred guilt would turn out to be
better than those in legal union.9 (Underscoring supplied)
Hence, the present petition, petitioners arguing that the
appellate court gravely erred in:
I.
. . . APPLYING THE STATE POLICY ON PROHIBITION AGAINST
CONVEYANCES AND TRANSFERS OF PROPERTIES BETWEEN
LEGITIMATE AND COMMON LAW SPOUSES ON THE
SUBJECT PROPERTY, THE SAME BEING FOUND BY THE
COURT A QUO, AS THE EXCLUSIVE PROPERTY OF
PETITIONER, AND THAT THE SAME WAS NEVER PART OF
THE CONJUGAL PROPERTY OF THE MARRIAGE BETWEEN
RESPONDENTS MOTHER EPIFANIA GOYANKO AND
PETITIONERS COMMON LAW HUSBAND, JOSEPH GOYANKO,
SR., NOR THE EXCLUSIVE OR CAPITAL PROPERTY OF THE
LATTER AT ANYTIME BEFORE THE SAME WAS VALIDLY
ACQUIRED BY PETITIONER.
II.

. . . NOT FINDING THAT A JURIDICAL RELATION OF TRUST


AS PROVIDED FOR UNDER ARTICLES 1448 AND 1450 OF
THE NEW CIVIL CODE CAN VALIDLY EXIST BETWEEN
COMMON LAW SPOUSES.
III.
. . . NOT FINDING THAT A CONVEYANCE OVER A PROPERTY
MADE BY A TRUSTEE, WHO BECAME AS SUCH IN
CONTEMPLATION OF LAW, AND WHO HAPPENS TO BE A
COMMON LAW HUSBAND OF THE BENEFICIARY, IS NOT A
VIOLATION OF A STATE POLICY ON PROHIBITION AGAINST
CONVEYANCES AND TRANSFERS OF PROPERTIES BETWEEN
LEGITIMATE AND COMMON LAW SPOUSES.
IV.
. . . ALLOWING RESPONDENTS TO ABANDON THEIR
ORIGINAL THEORY OF THEIR CASE DURING APPEAL.10
The pertinent provisions of the Civil Code which apply to the
present case read:
ART. 1352. Contracts without cause, or with unlawful cause,
produce no effect whatever. The cause is unlawful if it is
contrary to law, morals, good customs, public order or public
policy.
ART. 1409. The following contracts are inexistent and void
from the beginning:
(1) Those whose cause, object or purpose is contrary to
law, morals, good customs, public order or public policy;
(2) Those which are absolutely simulated or fictitious;
(3) Those whose cause or object did not exist at the time
of the transaction;
(4) Those whose object is outside the commerce of men;
(5) Those which contemplate an impossible service;
(6) Those where the intention of the parties relative to the
principal object of the contract cannot be ascertained;
(7) Those expressly prohibited or declared void by law.
These contracts cannot be ratified. Neither can the right to
set up the defense of illegality be waived.
ARTICLE 1490. The husband and wife cannot sell property to
each other, except:
(1) When a separation of property was agreed upon in the
marriage settlements; or
(2) When there has been a judicial separation of property
under Article 191. (Underscoring supplied)
The proscription against sale of property between spouses
applies even to common law relationships. So this Court
ruled in Calimlim-Canullas v. Hon. Fortun, etc., et al.:11
Anent the second issue, we find that the contract of sale was
null and void for being contrary to morals and public
policy. The sale was made by a husband in favor of a
concubine after he had abandoned his family and left
the conjugal home where his wife and children lived
and from whence they derived their support. The sale
was subversive of the stability of the family, a basic
social institution which public policy cherishes and
protects.
Article 1409 of the Civil Code states inter alia that: contracts
whose cause, object, or purposes is contrary to law, morals,

good customs, public order, or public policy


are void and inexistent from the very beginning.
Article 1352 also provides that: "Contracts without cause, or
with unlawful cause, produce no effect whatsoever. The
cause is unlawful if it is contrary to law, morals, good
customs, public order, or public policy."
Additionally, the law emphatically prohibits the
spouses from selling property to each other subject
to certain exceptions.1wphi1 Similarly, donations
between spouses during marriage are prohibited. And
this is so because if transfers or conveyances between
spouses were allowed during marriage, that would destroy
the system of conjugal partnership, a basic policy in civil law.
It was also designed to prevent the exercise of undue
influence by one spouse over the other, as well as to protect
the institution of marriage, which is the cornerstone of
family law. The prohibitions apply to a couple living as
husband and wife without benefit of marriage,
otherwise, "the condition of those who incurred guilt
would turn out to be better than those in legal
union." Those provisions are dictated by public interest and
their criterion must be imposed upon the will of the parties. .
. .12 (Italics in the original; emphasis and underscoring
supplied)
As the conveyance in question was made by Goyangko in
favor of his common- law-wife-herein petitioner, it was null
and void.
Petitioners argument that a trust relationship was created
between Goyanko as trustee and her as beneficiary as
provided in Articles 1448 and 1450 of the Civil Code which
read:
ARTICLE 1448. There is an implied trust when property is
sold, and the legal estate is granted to one party but the
price is paid by another for the purpose of having the
beneficial interest of the property. The former is the trustee,
while the latter is the beneficiary. However, if the person to
whom the title is conveyed is a child, legitimate or
illegitimate, of the one paying the price of the sale, no trust
is implied by law, it being disputably presumed that there is
a gift in favor of the child.
ARTICLE 1450. If the price of a sale of property is loaned or
paid by one person for the benefit of another and the
conveyance is made to the lender or payor to secure the
payment of the debt, a trust arises by operation of law in
favor of the person to whom the money is loaned or for
whom it is paid. The latter may redeem the property and
compel a conveyance thereof to him.
does not persuade.
For petitioners testimony that it was she who provided the
purchase price is uncorroborated. That she may have been
considered the breadwinner of the family and that there was
proof that she earned a living do not conclusively clinch her
claim.
As to the change of theory by respondents from forgery of
their fathers signature in the deed of sale to sale contrary to
public policy, it too does not persuade. Generally, a party in
a litigation is not permitted to freely and substantially
change the theory of his case so as not to put the other
party to undue disadvantage by not accurately and timely
apprising him of what he is up against,13 and to ensure that
the latter is given the opportunity during trial to refute all
allegations against him by presenting evidence to the
contrary. In the present case, petitioner cannot be said to
have been put to undue disadvantage and to have been
denied the chance to refute all the allegations against her.
For the nullification of the sale is anchored on its
illegality per se, it being violative of the above-cited Articles
1352, 1409 and 1490 of the Civil Code.
WHEREFORE, the petition is DENIED for lack of merit.
Costs against petitioner.

SO ORDERED

G.R. No. L-39670

March 20, 1934

In the matter of the intestate estate of the deceased


Crispulo Javillo.
ROSARIO OAS, oppositor-appellant,
vs.
CONSOLACION JAVILLO, ET AL., petitioners-appellees.
Pedro Malveda for appellant.
Santiago Abella for appellees.
GODDARD, J.:
This is an appeal from an order of the Court of First Instance
of Capiz approving a project of partition of the property
belonging to the estate of the deceased Crispulo Javillo
valued at P16,000 more or less.
Crispulo Javillo died intestate on the 18th of May, 1927, in
the municipality of Sigma, Province of Capiz, Philippine
Islands. On the 25th day of July, 1927, a petition was filed in
the Court of First Instance of that province praying that an
administrator of this estate be appointed, and after hearing
Santiago Andrada was named administrator. He submitted
two projects of partition. The first was disapproved by the
lower court and from that order some of the heirs appealed
to this court which appeal was dismissed. 1The second
project of partition dated September 9, 1931, is the one now
on appeal in this case.
Crispulo Javillo contracted two marriages. The first, with
Ramona Levis. To this marriage five children were born, to
wit, Consolacion, Mercedes, Caridad, Soledad and Jose
Javillo, the appellees in this case. After the death of Ramona
Levis, Crispulo Javillo married Rosario Oas. To this marriage
four children were born, to wit, Joaquin, Ana, Bernardo and
Porillana. Rosario Oas the appellant in this case.
The parties entered into the following agreement as to the
property acquired during the first and second marriages:
CONVENIO: Ambas partes convienen que 109 terrenos
designados como parcelas 1., 2., 3., 4.., 5., 6., 7.,
8., 9.., 10., 11. del inventario de los commisionados de
avaluo y reclamaciones obrantes a folios 40 al 43 del
expediente han sido encontrados durante la vida marital
de Crispulo Javillo con su primera esposa, madre de
Consolacion, Mercedes, Caridad, Soledad y Jose Javillo; y
que las parcelas 12., 13., 14., 15., 16., 17., 18.,
19., 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30 y 31 de
dicho inventario fueron comprados o encontrados durante
la vida marital de Crispulo Javillo con Rosario Oas. Que
durante el primer matrimonio fueron adquiridos cinco
carabaos y el resto de los carabaos asi como los vacunos
fueron encontrados durante el matrimonio de Crispulo
Javillo con Rosario Oas.
The appellant alleges that the lower court committed the
following errors:
I. The lower court erred in holding that all the properties
acquired during the second marriage of Crispulo Javillo
with Rosario Oas were acquired with the products of the
properties of the first marriage of said Crispulo Javillo with
Ramona Levis, and in approving the manner of distributing
the estates among the heirs of the first and second
marriages, as indicated in the project of partition now in
question.
II. The lower court erred in approving the second project of
partition dated September 9, 1931, notwithstanding that
the same did not include all the properties of the
deceased Crispulo Javillo.
The first assignment of error is well taken. Crispulo Javillo
lived for about twenty years after his second marriage and
during that marriage acquired twenty parcels of land. Only
eleven parcels were acquired during the first marriage. It
would take a person with a very vivid imagination to believe

that the product of eleven parcels of land acquired during


the first marriage supplied all of the capital used in acquiring
the twenty parcels of the second marriage. Such a claim is
preposterous.
Some Spanish commentators have suggested that upon
the death of the husband or wife, the community
continues between the survivor and the heirs of the
deceased until partition has actually taken place, and that
the latter are entitled to share in its acquisitions during its
continuance. . . . But this view was never generally
accepted by the Spanish jurists, and an examination of the
provisions of the Civil Code makes it clear that the authors
of that body of laws did not contemplate any such
extension of the life of the community. Gutierrez adopting
the views of Matienzo says:
"The community partnership being as permanent as the
state that produces it, there can be no doubt that the
same causes influence it as marriage. The first of them is
death. Some have believed that the community might
continue to exist between the surviving spouse and the
heirs of the deceased husband or wife; but, in the opinion
of Matienzo, which appears to us to be well-founded, there
are reasons for believing otherwise, to wit: (1) When the
marriage is dissolved, the cause that brought about the
community ceases, for the principles of an ordinary
partnership are not applicable to this community, which is
governed by special rules. (2) In the absence of the
reasons that induced the legislator to establish it, the
provisions of law governing the subject should cease to
have any effect for the community of property is
admissible and proper in so far as it conforms to unity of
life, to the mutual affection between husband and wife,
and serves as a recompense for the care of preserving and
increasing the property; all of which terminates by the
death of one of the partners. (3) The partnership having
been created by law, it has no object and it is unsafe to
extend it on pretext of tacit consent." (Gutierrez, 3rd ed.,
vol. 1. p. 579.)
Manresa, discussing the status of the community
(sociedad) after dissolution of the conjugal relations
makes the following comment:
". . . The community terminates when the marriage is
dissolved or annulled, or when during the marriage, an
agreement is entered into to divide the conjugal property.
The conjugal partnership exists therefore so long as the
spouses are legally united; the important thing is not
exactly the bond, the tie formed by the marriage, but, the
existence in the eyes of the law of the life in common. It is
this life in common that creates common necessities and
represents common efforts, the result of which should be
that both partners should share in the profits.
"When, for any cause, the conjugal partnership
established upon the basis of the system of community
property is dissolved, all the provisions of articles 1401 to
1416, based upon the existence of that partnership, cease
to apply.
"Consequently, whatever is acquired by the surviving
spouse on the dissolution of the partnership by death or
presumption of death, or by either of the spouse on
termination of the partnership for other reasons and when
this latter no longer exists, whether the acquisition be
made by his or her labor or industry, or whether by
onerous or by lucrative title, it forms a a part of his or her
own capital, in which the other consort, or his or her heirs,
can claim no share. The fruits, as an accessory, follow the
property; the buildings, the soil; the plantings, the land
all according to the general rules of accession." (Nable
Jose vs. Nable Jose, 41 Phil., 713, 717-719.)1vvphi1.ne+
. . . it may fairly be deduced that prior to the liquidation,
the interest of the wife, and in case of her death, of her
heirs, is an interest inchoate, a mere expectancy, which
constitutes neither a legal nor an equitable estate, and
does not ripen into title until it appears that there are

assets in the community as a result of the liquidation and


settlement. . . . Nable Jose vs. Nable Jose, supra.)
In this case it does not appear that there was a liquidation of
the partnership property of the first marriage nor does it
appear that they asked for such a liquidation.

represented by their mother, Rosenda Genove) all against


their father, Nicolas Delizo, and his second wife, Dorotea de
Ocampo, and their nine (9) children, the herein petitionersappellants, namely Regino, Crispina, Carmen, Basilio, Hilario,
Macario, Sendon, Marciano, and Hermogenes, all surnamed
Delizo.

The project of partition approved by the lower court is based


on the above-mentioned absurd claim and furthermore is not
in conformity to law. One-half of all the conjugal property of
both marriages corresponds to the deceased Crispulo Javillo
and must be divided share and share alike among all the
children of both marriages. One-half of the conjugal property
pertaining to the first marriage should be divided share and
share alike among the five children of that marriage. Onehalf of the conjugal property of the second marriage must be
adjudicated to the widow Rosario Oas and furthermore she
has a right of usufruct over the property of her deceased
husband equal to one-ninth of the two thirds of that property
which constitutes the legitime of the children of both
marriages which is two-twenty-sevenths of the property
corresponding to her husband. This usufruct should be taken
from the property pertaining to the second marriage.

The aforesaid defendants opposed the partition, claiming


that the properties described in the complaint were those of
the second marriage. On May 3, 1957, Nicolas Delizo died
and was substituted by his children in the second m as party
defendants. In the meantime, Special Proceedings No. 1058
(Intestate Estate of the late Nicolas Delizo) was filed by
Dorotea de Ocampo on June 3, 1957. Thereafter, or on
August 23, 1971, Severino De died intestate and is now
represented by his children, namely, Federico, Severina,
Angelina, Segundina and Brigida, all surnamed Delizo.
Involved are the properties acquired by Nicolas Delizo,
among which are sixty-six (66) hectares of agricultural lands
in San Jose City, Nueva Ecija; fifty-eight (58) hectares of
riceland in Muoz of the same province; and a square meter
lot at 1056-M P. Campa, Sampaloc, Manila. The properties
are specifically described as follows:

The property corresponding to the first marriage consists of


parcels 1 to 11, inclusive, and 5 carabaos. The property of
the second marriage consists of parcels 12 to 31, inclusive,
and the remainder of the carabaos and large cattle
mentioned in the agreement copied above.

(1) Lots Nos. 210, 211, 388, 389, 390, and 407 of the San
Jose Cadastre situation in Rizal, San Jose with a combined
area of about sixty-six (66) hectares covered by OCT No.
6176-N.E. issued in the name of Nicolas Delizo, married to
Dorotea de Ocampo (Exh. F or 11);

If it is true as alleged by the appellant that there are houses


on any of these parcels of land, it is to be presumed that
they were included in the valuation made by the committee
on claims and appraisal and therefore they would belong to
the person to whom the land, upon which they are built, is
adjudicated.

(2) Lot No. 1915 of the San Jose Cadastre with an area of
about 1,056 square meters and covered by OCT No. 5783 in
the name of Nicolas Delizo, married to Dorotea de Ocampo
(Exh. G or 12);

The judgment of the lower court is reversed and this case is


remanded for further proceedings in conformity with this
decision without pronouncements as to costs.

(3) Lot No. 498 of the San Jose Cadastre with an area of
about 3,366 square meters and covered by OCT No. 5622,
N.E. issued in the name of Nicolas Delizo, married to Dorotea
de Ocampo (Exh. H. or 13);
(4) A parcel of land in San Jose, Nueva Ecija containing an
area of 13.2948 hectares and covered by TCT No. 2985-N.E.
(Exh. I. or 13-A);

.R. No. L-32820-21 January 30, 1976


DOROTEA DE OCAMPO VDA. DE DELIZO and her nine
(9) children, named REGINO, CRISPINA, CARMEN,
BASILIO, HILARIO, MACARIO, SENDON MARCIANO and
HERMOGENES, all surnamed DELIZO y
OCAMPO,petitioners-appellants,
vs.
URBANA DELIZO, assisted by her husband, AMBROCIO
FLORA, SEVERINO DELIZO and the Heirs of
FRANCISCO DELIZO, namely, RANCIVILLANO
SOLTRIFILO, JOSEFINA, EUPROCINA, AUREA, EDITA and
FE all surnamed DELIZO, and ROSENDA GENOVE VDA.
DE DELIZO, respondents-appellees.

(5) An agricultural land of about 17.4753 hectares situated


in sitio Rangayan, Muoz and covered by TCT No. 5162 (Exh.
J or 14);
(6) A parcel of land in Barrio Caanawan, San Jose, with an
area of about 14.0354 hectares and covered by TCT No.
11910 (Exh. K or 10);
(7) A cornland in Barrio Rangayan, Muoz, Nueva Ecija, of
about 1,500 square meters and covered by Tax Declaration
No. 5476;
(8) Riceland in Barrio San Andres, Muoz of about 5,083
square meters and covered by Tax Declaration No. 7083;

Leandro C. Sevilla for petitioners-appellants.


Romeo J. Callejo respondents-appellees.

(9) Riceland in Barrio Rangayan, Muoz, Nueva Ecija,


containing an area of about 17.4755 hectares and covered
by Tax Declaration No. 812;

ANTONIO, J.:

(10) Lot No. 847-a riceland in Barrio Bayan, Muoz, with an


area of about 13.0902 hectares and covered by TCT No.
3585 issued in the name of Nicolas Delizo, married to
Dorotea de Ocampo on April 25,1929 (Exhs. L or 15 & 15-A);

These two cases involve the partition of the conjugal


partnership properties of two marriages contracted by
Nicolas Delizo. The first, was with Rosa Villasfer, which lasted
from April 20, 1891 until Rows death on December 7, 1909,
or a period of eighteen (18) years; and the second, with
Dorotea de Ocampo, which existed for a period of forty-six
(46) years, or from October, 1911 until the death of Nicolas
Delizo on May 3, 1957 at the age of ninety (90) years. The
action for partition was instituted on April 15, 1957 by a
daughter and a son of the first marriage, namely, Urbana
Delizo and Severino Delizo, and the heirs of Francisco Delizo,
another son, who died in 1943, specifically, Rancivillano
Soltrifilo Josefina, Eufrocina, Aurea, Edita, and Fe, all
surnamed Delizo (the last three being minors were

(11) A camarin of strong materials, with galvanized iron


roofing in San Jose, Nueva Ecija, about eight (8) meters by
twelve
(12) meters; (12) A residential house and lot at Sanchez
Street, San Jose, Nueva Ecija;
(13) Lot No. 1790 of San Jose Cadastre of about 2,840
square meters and covered by Original Certificate of Title
No. 8131 in the names of spouses Silvestre Batara and Maria
Soriano issued on November 16, 1927 (Exh. M or 16),
superseded by Transfer Certificate of Title No. NT-29524

issued in the name of Juan T. Gualberto on May 25,1959


(Exh. N or 17) claimed by the heirs of Nicolas Delizo and
Dorotea de Ocampo pursuant to deed of sale (Exh. N1);
(14) An urban lot and coconut plantation in San Fabian,
Pangasinan;
(15) A lot and residential house consisting Of a two-door
accessoria at No. 1056-58 (formerly 562) P. Campa,
Sampaloc, Manila;
(16) A sawmill with accessories, bulldozers, etc. in San Jose,
Nueva Ecija (bulldozer is now in Gordon, Isabels in the
possession of Regino Delizo and Basilio Delizo); and
(17) Several heads of carabaos. After trial, the lower court
rendered judgment on April 27, 1964, distributing the
aforesaid properties as follows: (a) onehalf () pro indiviso
to the three (3) children of the first marriage, namely,
Urbana Delizo, Severino Delizo, and the heirs of the
deceased Francisco Delizo, viz.: Rancivillano Soltrifilo
Josefina, Eufrocina, Aurea, Edita, and Fe (b) one-fourth ()
pro indiviso to the surviving spouse, Dorotea de Ocampo;
and (c) one-fourth () pro in equal shares to the children of
both marriages, nine (9) of whom were begotten during the
second marriage, or into thirteen (13) parts.
From said judgment. petitioners-appellants appealed to the
Court of Appeals. On August 12, 1970, the Appellate Court
rendered judgment, affirming with modifications the trial
court's decision. The facts as found by the Appellate Court
are as follows:
As regards the Caanawan lands situated in Caanawan,
San Jose, Nueva Ecija, comprising some 66 hectares,
defendants capitalize on the undisputed fact that Original
Certificate of Title No. 6176 (Exh. F or 11) issued on
August 21, 1924, covering these lands is in the name of
Nicolas Delizo, ma to Dorotea de Ocampo. Defendants
further point out that the testimonies of defendant
Dorotea de Ocampo and octogenarian Moises Patricio
prove that these lands were acquired during the second
marriage.
However, the fact that the disputed lands situated in
Caanawan were registered in the name of 'Nicolas Delizo,
married to Dorotea de Ocampo's no proof that the
property is owned by the second conjugal partnership.
The phrase 'married to' is merely descriptive of the civil
status of Nicolas Delizo (Gonzales vs. Miller, 69 Phil. 340;
De Jesus vs. Padilla, CA-G.R. No. 12191-R, April 19, 1955;
Muoz & Tan Go Inc. vs. Santos CA-G.R. No. "27759-R,
October 3, 1963; Pratts vs. Sheriff of Rizal, 53 Phil. 51,
53). Neither is the testimony of Dorotea de Ocampo that
the said lands were acquired by her and her spouse,
altogether clear and persuasive. For while the admitted
fact is that she and Nicolas Delizo were married in 1911,
she declared on the witness stand that the aforesaid
properties were given by Pedro Salvador to her and her
spouse in 1908 (t.s.n., p. 288, March 8, 1963), thereby
leading the trial court to infer an admission that these
lands were acquired during the first marriage of Nicolas
Delizo. It may likewise be noted that as per her
testimony, she and her father arrived in Caanawan, San
Jose, Nueva Ecija, when Rosa Villasfer was still alive. That
would be sometime before 1911. But she admitted that
her father then was not able to acquire lands from Pedro
Salvador, their grantor, because he had no more lands to
distribute to settlers. Accordingly, it is farfetched that
after Rosa's death and the subsequent marriage of
Nicolas Delizo to Dorotea de Ocampo, Pedro Salvador
would still have those 67 hectares which defendants
claimed were acquired by the spouses Nicolas Delizo and
Dorotea de Ocampo by grant from Pedro Salvador (t.s.n.,
pp. 459-46, March 15, 1963).
Moises Patricio tried to confirm the widow, declaring that
Nicolas Delizo was married to defendant Dorotea de
Ocampo, when he was given lands in Caanawan by Pedro
Salvador (t.s.n., p. 493, June 7, 1963). However, he
placed the acquisition sometime during the founding of
Barrio Sto. Tomas, San Jose, Nueva Ecija (Id., p. 492)

which took place some four years after the SpanishFilipino revolution of 1896 (t.s.n., pp. 548-549, June 21,
1963), or approximately 1900. Therefore, it could not be
Dorotea de Ocampo, but Rosa Villasfer, who was
admittedly still alive and the wife of Nicolas Delizo at the
time of the acquisition.
Ranged against these unreliable testimonies for the
defendants, is the testimony of Lorenzo Delizo, who
being a brother of deceased Nicolas Delizo, stands in
equal relationship to the plaintiffs, who were Nicolas'
children by the first marriage, and the defendants, who
were children of Nicolas in his second marriage. His
testimony therefore carries great weight. This witness
averred that 16 hectares were acquired as homestead by
his deceased brother, Nicolas Delizo, from Pedro Salvador
and Mauricio Salvador who were then 'cabecillas'
distributing lands to homesteaders in 1905 (t.s.n., p. 12,
January 20, 1961); that Nicolas acquired by sale the 16hectare homestead of Nicolas Dacquel in 1906, another
16- hectare homestead of Mariano Antolin in 1907 and
the 16-hectare homestead of Francisco Pascua in 1908
(id., pp. 14-15). Lorenzo's declarations are supported by
the testimonies of (1) Urbana Delizo, a daughter of
Nicolas by his first marriage and who was already 17
when her mother, Rosa Villasfer, died in 1909 (id., p. 19);
(2) Sabiniano Villanueva, a son of one of Nicolas' tenants
on the controverted Caanawan lands (id., pp. 93-168)
and (3) Raymundo Eugenio, a former clerk in the
municipal treasurer's office who u to collect taxes on the
land belonging to Nicolas and later became municipal
"president of San Jose, Nueva Ecija (t.s.n., pp. 367-368,
Jan. 31, 1964), although these Caanawan lands cannot be
traced back to TD 431, Exhibit P-9 issued in 1906, cited
by appellants (see notations at bottom of reverse side of
alleged succeeding TDs) aside from the fact that the
notations on the reverse side thereof are suspicious (see
years when tax commenced and when issued) and the
discrepancy between areas (8 Ha. in Exhibit P-9 and 57
Ha. for lots 210 and 211).
Accordingly, we find with the trial court that the
Caanawan lands, comprising lots Nos. 210, 211, 388,
390, 398 and 407.1-under Original Certificate of Title No.
6176 (Exh. F or 11) were acquired during the existence of
the first marriage of Nicolas Delizo to Rosa Villasfer and
there being no affirmative showing that they belonged
exclusively to said Nicolas Delizo, should therefore
correspond to the first conjugal partnership of Nicolas
Delizo and Rosa Villasfer. So with the lot and house at
562 P. Campa St., Sampaloc, Manila, known as Lot 47,
Block 83 covered by TCT No. 9616-Manila which was
ceded during the second marriage in payment of, or
substitution for, the Caanawan property, because the
Asiatic Petroleum Company to which it had been
mortgaged as bond for Juan Par as agent foreclosed the
mortgage, when the agent defaulted in his obligation to
the company, Exhibits 6, 7 & 19 (Art. 153 [formerly, 140],
par. 1, new Civil Code).
However, with regard to the other properties in question,
like lot No. 498 of the San Jose Cadastre, under Original
certificate of Title No. 5622, likewise issued in the name
of Nicolas Delizo, married to Dorotea de Ocampo'; a
parcel of land in San Jose, Nueva Ecija under TCT No.
2985 (Exh. I or 13)' and agricultural land of about
17.4753 hectares in Sitio Rangayan, Muoz Nueva Ecija
under TCT No. 5162 (Exh. J or 14); another parcel of land
in Caanawan, San Jose, with an area of about 14.0354
hectares under TCT No. 11910 (Exh. K or 10); a coin land
in barrio Rangayan, Muoz, Nueva Ecija, of about 1,500
square me ' quarters under Tax Declaration No. 5476; a
riceland in barrio San Andres, Muoz Nueva Ecija, of
about 5,083 square meters under Tax Dec. 7083; another
riceland in Rangayan, Muoz, of about 17.4755 hectares
under Tax Dec. No. 812; a riceland, lot No. 847, of about
13.0902 hectares covered by TCT No. 3585 issued on
April 29, 1929 in the name of 'Nicolas Delizo, married to
Dorotea de Ocampo'(Exh. L or 1.5)-, a camarin of strong
materials with galvanized iron roofing in San Jose, Nueva
Ecija, about 8 meters by 12 meters; a residential lot at
Sanches Street, San Jose, Nueva Ecija; lot No. 1790 of the
San Jose Cadastre consisting of 2,840 square meters,
more or less, under Original Certificate of Title No. 8131

in another name but claimed by the heirs under deed of


sale, Exhibit N1 a sugar cane mill in San Jose, Nueva Ecija
and several heads of carabaos (Exh. 0); Lots Nos. 495
and 496 of the San Jose Cadastre, possessed by
defendants although adjudicated in the name of Marcelo
Tomas and Guillermo Cabiso, respectively; lot No. 494-A,
of the San Jose Cadastre, adjudicated in the name of
Nicolas Delizo and Dorotea de Ocampo (RA, pp. 96-97),there is no controversy that these were all acquired
during the existence of the second marriage of Nicolas
Delizo.
On the basis of the foregoing facts, the Court of Appeals
rendered judgment as follows:
But the trial court held that because there was no
liquidation of the conjugal partnership property of the first
marriage, upon the death of the first wife, 'the conjugal
partnership was converted into one of co-ownership
between Nicolas Delizo and his children of the first
marriage .... Hence, all the fruits or increase of the
properties acquired thereafter shall belong to such coownership.' We cannot agree with this legal conclusion.
One-half of the conjugal properties of the first marriage
constituted the separate property of the husband at the
formation of the second conjugal partnership upon his
remarriage in October 1911 (Art. 145, NCC). Moreover, the
fruits of the Caanawan property were acquired through the
labor and industry of Nicolas Delizo and Dorotea Ocampo;
and indeed, two witnesses for the plaintiffs admitted that
at the time of the death of Rosa Villasfer, only about 20
hectares of the Caanawan property had been cleared and
cultivated (pp. 22-23; 113, 117, 383-4, t.s.n.). This
property was practically virgin land, and the rest thereof
or about 47 hectares were therefore cleared and
cultivated only during the marriage of Nicolas Delizo and
Dorotea Ocampo. This is impliedly admitted in plaintiffs'
complaint that 'from the time of death of the said Rosa
Villasfer, the defendants ... have WORKED upon, TILLED
and CULTIVATED, or otherwise offered in tenancy the
whole of the agricultural lands described' (par. 2). The
Caanawan property left to itself could not produce any
fruits for they did not have any permanent improvements
thereon. What was produced according to the evidence
was palay, and the production of palay requires tilling,
cultivation, seedlings, gathering, preservation and
marketing. It was thru the labor and industry of Nicolas
Delizo and Dorotea de Ocampo that the Caanawan
property was able to produce fruits. Whatever it produced
thru the labor and industry of the spouses belongs to their
conjugal partnership. While it is true that to the owner of
the land belongs the fruits, whether natural, industrial or
civil (Art. 441, NCC formerly Art. 354, Spanish Civil Code),
this does not mean that all that is produced belongs to the
owner of the land. The owner, according to Art. 443, NCC
(formerly Art. 356, Spanish Civil Code) who receives the
fruits, has the obligation to pay the expenses made by a
person in their production, gathering and preservation.
When Dorotea Ocampo admitted that the Muoz property
was purchased partly with the fruits of the Caanawan
property, she was referring to the gross production, not
deducting therefrom what could have pertained to the
person who produced the fruits. So it seems "that if we are
to determine with mathematical certainty what portion of
the Muoz property and other properties acquired during
the second marriage should pertain to the first marriage
as corn spending to the value of its share in the fruits of
the Caanawan property, and what should belong to the
second marriage as corresponding to the value of the
labor and industry of the spouses Delizo and Ocampo, we
have to find how much was produced during the second
marriage and determine what will be the share of the
owner of the land what will correspond to the one who
produced the fruits. The burden of proof lies upon the
plaintiffs under the rules of evidence. But, of course, this
is an impossibility. For no records have been kept and it is
not in accordance with the Filipino customs for the
surviving spouse-whether he remarries or not-to keep the
record of the produce of the properties left by the
deceased spouse. tradition thereto, according to Dorotea
Ocampo, part of the price used in the purchase of Muoz
property was the proceeds of a loan which, together with
the properties purchased with it, belongs to the conjugal
partnership of Nicolas Delizo and Dorotea Ocampo. Under
these circumstances, it would be impossible to determine

with mathematical precision what portion of the properties


acquired during the second marriage of Nicolas Delizo
should belong to the second conjugal partnership and
what portion should belong to the heirs of the first
conjugal partnership, one half of which pertains to the
husband. However, considering that
1. At the time of the dissolution of the first marriage or
about five years after acquisition, according to plaintiffs'
evidence, only about 20 hectares of the Caanawan
property had been cultivated, the remaining 47 hectares
were therefore cleared and improved during the second
marriage thru the labor and industry of the spouses
Nicolas Delizo and Dorotea Ocampo for 46 years (19111967). These improvements were made in good faith
considering that Nicolas Delizo administered the
properties of the first marriage. The second marriage is
entitled to reimbursement for the increase in value of
these 47 hectares (Art. 516, NCC Even the Muoz property
acquired during the second marriage had to be improved
by the spouses Nicolas Delizo and Dorotea Ocampo.
2. The one-half of the fruits of the Caanawan property
which should pertain to the heirs of Rosa Villasfer refers
only to one-half o f the net after deducting the expenses
of clearing the land, cultivating, gathering and
preservation. Forty-seven hectares of the Caanawan
property were cleared and cultivated only during the
second marriage. Even under a liberal apportionment of
the produce, the heirs of the second marriage could not be
entitled to more than 30% of the produce.
3. Part of the price used in the purchase of the properties
acquired during the second marriage were the proceeds of
a loan. This is conjugal property of the "second marriage
(Palanca vs. Smith, Bell and Co., 9 Phil. 131,133; Castillo Jr.
vs. Pasco, 11 SCRA 102, 106-7).
4. The improvements on 47 hectares of the Caanawan
property and on the Muoz property were made at the
expense of the second conjugal partnership of Nicolas
Delizo and Dorotea Ocampo, and thru their labor and
industry which lasted for 46 years, whereas the first
conjugal partnership had the Caanawan property for less
than 6 years.
Taking into account all the foregoing circumstances and
equities of the case, an adjudication of 20% of all the
properties acquired during the second marriage, including
the Muoz property, to the children of the first marriage,
and 80% to the conjugal partnership of Nicolas Delizo and
Dorotea Ocampo is fair and equitable. So the properties of
the estate should be partitioned thus:
One-half of the Caanawan property and the house and lot
at 562 P. Campa Street, Manila, covered by TCT No. 9616
as the share of Rosa Villasfer in the first conjugal
partnership of Nicolas Delizo and Rosa Villasfer or 1/6
thereof for each child of the first marriage; and 20% of all
the other properties or 1/15 thereof for each such child. To
Nicolas Delizo should be adjudicated one-half of the
Caanawan property and the house and lot on P. Campa,
but in view of the death of Nicolas Delizo his share
descends to all the children, both of the first and second
marriages and the surviving spouse, Dorotea Ocampo, and
should therefore be divided by the number of children plus
one or 1/26 thereof for each heir. tightly per cent of all the
properties acquired during the marriage of Nicolas Delizo
and Dorotea Ocampo constitute the conjugal partnership
of Nicolas Delizo and Dorotea Ocampo; one-half thereof is
the share of Nicolas Delizo, to be divided among his heirs
in accordance with the preceding statement, or 2/65
thereof for each heir; the other half constitutes the share
of Dorotea Ocampo in the conjugal partnership, or 2/5
thereof.
WHEREFORE, paragraph 1 of the judgment appealed from
is hereby modified as follows:
1. Declaring that (a) of the Caanawan property and the
house and lot at 562 P. Campa Street, Manila covered by
TCT No. 9616-8139 (1/6 + 1/26) thereof pro indiviso shall

pertain to each of the children of Nicolas Delizo "of the


first marriage, namely: Urbana, Severino and the late
Francisco Delizo (the last represented by his children
Rancivillano Soltrifilo Josefina, Eufrocina, Aurea, Edita and
Fe and 1/26 thereof pro indiviso shall pertain to each of
the children of the second marriage and their mother
Dorotea Ocampo; (a) of all other properties required
during the second marriage-19/195 thereof pro indiviso
shall pertain to each of the three children by the first
marriage, 2/65 thereof pro indiviso shall pertain to each of
the nine children of the second marriage, while 28/65
thereof pro indiviso shall pertain to the widow Dorotea
Ocampo. The rest of the judgment particularly paragraphs
2 and 3 are affirmed; without pronouncement as to costs
in both instances.
From this adverse judgment, petitioners-appellants
interposed the present petition for review. The thrust of
petitioners- appellants' petition is that the Appellate Court
acted under a misapprehension of the facts or decided the
legal issues in a way which is not in consonance with law
and with the applicable decisions of this Court, (a) since, the
67-hectare Caanawan properties could not have been
properties of the first marriage because they were then
public lands being homesteads, and while the first conjugal
partnership may have had possessory rights over said
properties, it was only during the second marriage that the
requirements of the public land law were complied with,
resulting in the confirmation, registration and issuance of the
Torrens Title over said properties to Nicolas Delizo and his
second wife, Dorotea de Ocampo; (b) apart from the fact
that the legal presumption that all properties of the marriage
belong to the conjugal partnership of Nicolas Delizo and
Dorotea de Ocampo were not sufficiently rebutted, these
properties were actually. In the adverse possession under
claim of title of petitioners-appellants continuously for a
period of 47 years (1911 to 1957), and consequently, the
claim of respondents-appellees for partition should have
been considered barred by acquisitive and extinctive
prescription, laches and estoppel; d (c) in any event, there
being serious doubts as to whether. said properties belong to
the first marriage, it would have been more equitable if the
said partnership properties were divided between the
different partnerships in proportion to the duration of each
and the capital of the spouses,-pursuant to Article 189 of the
Civil Code.
From the findings of the Appellate Court that sixty-six (66)
hectares of the Caanawan properties w ere acquired by
Nicolas Delizo as homesteads during the period of the first
marriage, thus: sixteen (16) hectares as a homestead from
the Government in 1905; and the 16-hectare homestead of
Nicolas Dacquel, the 16-hectare homestead of Mariano
Antolin, and the 16-hectare homestead of Francisco Pascua
by purchase in 1%6, .1907 and 1908, respectively, it does
not necessarily follow that they should be considered as
properties of the first marriage, considering that being
homesteads they were part of the public domain, and it was
not shown that all the requirements of the Homestead Law
to warrant the grant of a patent to the homesteader have
been complied with prior to the death in 1909 of Delizo's
first wife, Rosa Villasfer.
Under Act 926, 1 which was then the applicable law, the right
of the homesteader to the patent does not become absolute
until after he has complied with all the requirements of the
law. One of the most important requirements is that the
"person filing the application shall prove by two credible
witnesses that he has resided upon and cultivated the land
for the term of five years immediately succeeding the time
of filing the application aforesaid, and shall make affidavit
that no part of said land has been alienated or
encumbered ... (Section 3 of Act 926, italics supplied). Prior
to the fulfillment of such requirement, the- applicant has no
complete equitable estate over the homestead which he can
sell and convey, mortgage for lease. 2 Until a homestead
right is established and registered under Section 3 of Act
926, there is only an inchoate right to the property and it
has not ceased to be a part of the public domain and,
therefore, not susceptible to alienation as such. 3 Conversely,
when a "homesteader has complied with all the terms and
conditions which entitled him to a patent for a particular
tract of public land, he acquires a vested interest therein and
has to be regarded an equitable owner thereof." 4The

decisive factor, therefore, in the determination of whether a


parcel of land acquired by way of homestead is conjugal
property of the first or the second marriage, is not
necessarily the time of the issuance of the homestead
patent but the time of the fulfillment of the requirements of
the public land law for the acquisition of such right to the
patent. 5
As testified to by Lorenzo Delizo, his brother, Nicolas Delizo,
and the latter's wife, Rosa Villasfer, arrived in Barrio
Caanawan, San Jose, Nueva Ecija, from Barrio Ungag,
Cuyapo, Nueva Ecija, during the year 1905. It was during
that same year that Pedro Salvador and Mauricio Salvador,
who were then the cabecillas were distributing lands to
homesteaders in Barrio Caanawan. Nicolas Dacquel, Mariano
Antolin and Francisco Pascua must have received their
respective homesteads from the same officers of the
government that same year, considering that their
respective homesteads are all adjacent to the homestead of
Nicolas Delizo and according to the evidence, this was the
time when the homesteads in that barrio were parceled out
to the new settlers. Indeed, the Homestead Act was then of
recent vintage, having been enacted by the Philippine
Commission by authority of the United States Government,
only on October 7, 1903.
Considering that Nicolas Dacquel must have been in
possession of his homestead for barely a year when he
transferred his rights in 1906, Mariano Antolin for about two
years with respect to his homestead in 1907, and Francisco
Pascua for about three years in 1908 as regards to his
homestead, at the time of their respective conveyances to
Nicolas Delizo, it is, therefore, obvious that not one of them
could have complied with the requirements of Act No. 926 to
entitle any one of them to the issuance of a homestead
patent before they sold or assigned their rights to Nicolas
Delizo. The law was quite specific, that "No certificate shall
be given or patent issued for the land applied for until the
motion of five year. From the date of the filing of the
application and if, at the expiration of such time or at any
time within three years thereafter, the person filing such
application shall prove by two credible witnesses that he has
resided upon and cultivate the land for the term of five years
immediately succeeding the time of filing the application
aforesaid, and shall make affidavit that no part of said land
has been I alienated or encumbered, and that he has borne
true allegiance to the Government of the United States and
that of the Philippine Islands, then, upon payment of a fee of
ten pesos, Philippine currency to such officer as may be
designated by law as local land officer, or in case there be
no such officer then to the Chief of the Bureau of Lands, he
shall be entitled to a patent." (Section 3, Act No. 926, italics
supplied). Having neither legal nor equitable title thereon,
what was transferred by them to Nicolas Delizo were,
therefore, not rights of ownership, but inchoate rights as
applicants for homesteads over portions of the public
domain. Similarly, having received the homestead only in
1905, Nicolas Delizo could not have perfected his rights
thereon by the completion of the five-year occupancy and
cultivation requirement of the law, in 1909. Buttressing the
conclusion that Nicolas Delizo could not have perfected his
rights to the four homesteads before 1909 is the specific
limitation imposed by section 3 of Act No. 926 which
provides that "No person who is the owner of more than
sixteen hectares of land in said Islands or who has had the
benefits of any gratuitous allotment of sixteen hectares of
land since the acquisition of the Islands by the United States,
shall be entitled to the benefits of this chapter."
The foregoing sufficiently show that the Appellate Court
erred in, holding that the entire Caanawan properties belong
to the conjugal partnership of Nicolas Delizo and Rosa
Villasfer. Considering, however, that about twenty (20)
hectares were cultivated and rendered productive during the
period from 1905 to 1909, judgment and equity demand that
the rights to said properties be apportioned to the parties in
proportion to the extent to which the requirements of the
public land laws had been complied with during the
existence of each conjugal partnership.
II
In connection with the other properties, such as Lot No. 498
of the San Jose Cadastre, under Original Certificate of Title

No. 5622; a parcel of land in San Jose, Nueva Ecija, under


Transfer Certificate of Title No. 2985 (Exh. I or 13), and
agricultural land of about 17.4753 hectares in Sitio
Rangayan, Muoz Nueva Ecija, under Transfer Certificate of
Title No. 5162 (Exh. J or 14); a parcel of land in Caanawan,
San Jose, with an area of about 14.0354 hectares, under
Transfer Certificate of Title No. 11910 (Exh. K or 10); a
cornland in Barrio Rangayan, Muoz, Nueva Ecija, of about
1,500 square meters under Tax Declaration No. 5476; a
riceland in Rangayan, Muoz of about 17.4755 hectares,
under Tax Declaration No. 812; a riceland, Lot No. 847, of
about 13.0902 hectares covered by Transfer Certificate of
Title No. 3585, issued on April 29, 1929 in the name of
"Nicolas Delizo, married to Dorotea de Ocampo" (Exh. L or
15); a camarin of strong materials with galvanized iron
roofing in San Jose, Nueva Ecija; a residential lot at Sanchez
Street, San Jose, Nueva Ecija; Lot No. 1790 of the San Jose
Cadastre, consisting of about 2,840 square meters, more or
less, under Original Certificate of Title No. 8131 "in another
name but claimed by the heirs under deed of sale, Exhibit
N1 a sugar mill in San Jose, Nueva Ecija and several heads of
carabaos (Exh. 0); Lots Nos. 495 and 496 of the San Jose
Cadastre, possessed by defendants although adjudicated in
the name of Marcelo Tomas and Guillermo Cabiso
respectively; and another lot, Lot No. 494A of the San Jose
Cadastre adjudicated in the ' C, name of Nicolas Delizo,
married to Dorotea de Ocampo, the Appellate Court decision
penned by Justice Arsenio Solidum held that "there is no
controversy that these were all acquired during the
existence of the second marriage of Nicolas Delizo"
The same opinion, however, held that since these properties
were acquired from the produce of the Caanawan properties
although such produce is the result of the labor and industry
of the spouses Nicolas Delizo and Dorotea de Ocampo, only
eighty per cent (80%) of said properties acquired during the
second marriage should appertain to the second conjugal
partnership, while twenty per cent (20%) thereof adjudicated
to the children of the first marriage. The two concurring
Appellate Justices, although of the view that the legal
presumption that those properties acquired during the
regime of the second conjugal partnership belong to said
partnership has not been rebutted by respondents-appellees
and, therefore, would hold that such after-acquired
properties should belong to the second conjugal partnership,
concurred nevertheless in the result aforesaid, in order to
reach a judgment in the case. It would have been facile to
hold that those after-acquired properties belong to the
second conjugal partnership in view of the statutory
presumption enunciated in Article 1407 of the old Civil Code
(now Article 160, New Civil Code). 6 There are, however,
important considerations which preclude Us from doing so.
There is the established fact that the produce of the
Caanawan lands contributed considerably to the acquisition
of these properties, and We have held that the children of
the first marriage, as a matter of equity, should share in the
Caanawan properties. To deny the respondents-appellees a
share in such properties would have exacerbated discord
instead of enhancing family solidarity and understanding.
Considering these circumstances and since the capital of
either marriage or the contribution of each spouse cannot be
determined with mathematical precision, the total mass of
these properties should be divided between the two conjugal
partnerships in proportion to the duration of each
partnership. 7 Under this criterion, the second conjugal
partnership should be entitled to 46/64 or 23/32 of the total
mass of properties, and the first conjugal partnership. to
18/64 or 9/32 thereof pro indivision. The share of the estate
of Nicolas Delizo is one-half (1/2) pro indiviso of the net
remainder 8 of the conjugal partnership of gains of the first
and second marriages, which would amount to 32/64 or 1/2
of the whole estate. This should be distributed in equal
shares to his children of both marriages, 9 with the widow
having the same share as that of legitimate child. 10 The
widow. Dorotea de Ocampo, is entitled to one-half () of the
net remainder of the second conjugal partnership and to her
share as heir of her deceased husband which amounts to
23/64 of said properties, plus 1/13 of 32/64 pro indivision.
The share of the heirs of Rosa Villasfer would be 9/64
thereof. The foregoing is recapitulated as follows:
Share of Rosa Villasfer, lst wife 9/64 of whole estate to be

divided among three (3)


children
Share of Dorotea de Ocampo, 23/64 of whole estate plus
her
2nd wife share in Nicolas
Delizo s estate.
Share of Nicolas Delizo, husband 32/64 of whole estate to
be
divided into thirteen
(13) equal parts.
Whole Estate 64/64
Computation of Sharing
3/64 + 1/26 = 142/1664]
3/64 + 1/26 = 142/1664] - Share of each child of
3/64 + 1/26 = 142/1664] lst marriage
1/26 = 64/1664]
1/26 = 64/1664]
1/26 = 64/1664]
1/26 = 64/1664] - Share of each child of
1/26 = 64/1664] 2nd marriage
1/26 = 64/1664]
1/26 = 64/1664]
1/26 = 64/1664]
1/26 = 64/1664]
23/64 + 1/26 = 662/1664 - Share of Dorotea Ocampo.
32/64 + 13/26= 1664/1664 - Whole Estate
In the partition of the properties, the probate court should
take into account the fact that the respondents-appellees
are in possession of the Muoz lands, while the petitionersappellants have been in possession of the Caanawan
properties as well as the house and lot at 562 P. Campa
Street. Sampaloc, Manila, as directed in the trial court's
order of April 23, 1958 record on Appeal, pp. 76-77). Should
it be convenient for the parties, their respective shares
should be taken from the properties presently under their
custody.
Having reached the foregoing conclusions. it is unnecessary
to resolve the other legal questions raised in the appeal.
WHEREFORE, the appealed decision of the Court of Appeals
is hereby modified as herein indicated. The records of these
cases should be, as they are hereby, remanded to the trial
court for further proceedings in accordance with this
judgment. No costs.

G.R. No. 180572

June 18, 2012

SPOUSES ATTY. ERLANDO A. ABRENICA and JOENA B.


ABRENICA Petitioners,
vs.
LAW FIRM OF ABRENICA, TUNGOL and TIBAYAN,
ATTYS. ABELARDO M. TIBAYAN and DANILO N.
TUNGOL, Respondents.
DECISION
SERENO, J.:
The present case is a continuation of G.R. No.
1694201 decided by this Court on 22 September 2006. For
brevity, we quote the relevant facts narrated in that case:
Petitioner Atty. Erlando A. Abrenica was a partner of
individual respondents, Attys. Danilo N. Tungol and Abelardo
M. Tibayan, in the Law Firm of Abrenica, Tungol and Tibayan
("the firm").
In 1998, respondents filed with the Securities and Exchange
Commission (SEC) two cases against petitioner. The first was
SEC Case No. 05-98-5959, for Accounting and Return and
Transfer of Partnership Funds With Damages and Application
for Issuance of Preliminary Attachment, where they alleged
that petitioner refused to return partnership funds
representing profits from the sale of a parcel of land in
Lemery, Batangas. The second was SEC Case No. 10-986123, also for Accounting and Return and Transfer of
Partnership Funds where respondents sought to recover from
petitioner retainer fees that he received from two clients of
the firm and the balance of the cash advance that he
obtained in 1997.
The SEC initially heard the cases but they were later
transferred to the Regional Trial Court of Quezon City
pursuant to Republic Act No. 8799, which transferred
jurisdiction over intra-corporate controversies from the SEC
to the courts. In a Consolidated Decision dated November
23, 2004, the Regional Trial Court of Quezon City, Branch
226, held that:
WHEREFORE, in view of all the foregoing, judgment is hereby
rendered as follows:

4. To pay the costs of suit.


SO ORDERED.
Petitioner received a copy of the decision on December 17,
2004. On December 21, 2004, he filed a notice of appeal
under Rule 41 and paid the required appeal fees.
Two days later, respondents filed a Motion for Issuance of
Writ of Execution pursuant to A.M. 01-2-04-SC, which
provides that decisions in intra-corporate disputes are
immediately executory and not subject to appeal unless
stayed by an appellate court.
On January 7, 2005, respondents filed an Opposition (To
Defendant's Notice of Appeal) on the ground that it violated
A.M. No. 04-9-07-SC2 prescribing appeal by certiorari under
Rule 43 as the correct mode of appeal from the trial courts
decisions on intra-corporate disputes.
Petitioner thereafter filed a Reply with Manifestation (To the
Opposition to Defendant's Notice of Appeal) and an
Opposition to respondents motion for execution.
On May 11, 2005, the trial court issued an Order requiring
petitioner to show cause why it should take cognizance of
the notice of appeal in view of A.M. No. 04-9-07-SC.
Petitioner did not comply with the said Order. Instead, on
June 10, 2005, he filed with the Court of Appeals a Motion for
Leave of Court to Admit Attached Petition for Review under
Rule 43 of the Revised Rules of Court. Respondents opposed
the motion.
The Court of Appeals denied petitioner's motion in its
assailed Resolution dated June 29, 2005 x x x.
xxx

xxx

xxx

The Court of Appeals also denied petitioner's motion for


reconsideration in its August 23, 2005 Resolution.
Given the foregoing facts, we dismissed the Petition in G.R.
No. 169420 on the ground that the appeal filed by petitioner
was the wrong remedy. For that reason, we held as follows: 3

CIVIL CASE NO. Q01-42948


1. Ordering the respondent Atty. Erlando Abrenica to
render full accounting of the amounts he received as
profits from the sale and resale of the Lemery property in
the amount of P 4,524,000.00;
2. Ordering the respondent Atty. Erlando Abrenica to
remit to the law firm the said amount of P4,524,000.00
plus interest of 12% per annum from the time he
received the same and converted the same to his own
personal use or from September 1997 until fully paid;
and
3. To pay the costs of suit.
CIVIL CASE NO. Q01-42959
1. Ordering Atty. Erlando Abrenica to render a full
accounting of the amounts he received under the retainer
agreement between the law firm and Atlanta Industries
Inc. and Atlanta Land Corporation in the amount
ofP 320,000.00.
2. Ordering Atty. Erlando Abrenica to remit to the law firm
the amount received by him under the Retainer
Agreement with Atlanta Industries, Inc. and Atlanta Land
Corporation in the amount of P 320,000.00 plus interests
of 12% per annum from June 1998 until fully paid;
3. Ordering Atty. Erlando Abrenica to pay the law firm his
balance on his cash advance in the amount of P25,000.00
with interest of 12% per annum from the date this
decision becomes final; and

Time and again, this Court has upheld dismissals of incorrect


appeals, even if these were timely filed. In Lanzaderas v.
Amethyst Security and General Services, Inc., this Court
affirmed the dismissal by the Court of Appeals of a petition
for review under Rule 43 to question a decision because the
proper mode of appeal should have been a petition for
certiorari under Rule 65. x x x.
xxx

xxx

xxx

Indeed, litigations should, and do, come to an end. "Public


interest demands an end to every litigation and a belated
effort to reopen a case that has already attained finality will
serve no purpose other than to delay the administration of
justice." In the instant case, the trial court's decision became
final and executory on January 3, 2005. Respondents had
already acquired a vested right in the effects of the finality
of the decision, which should not be disturbed any longer.
WHEREFORE, the petition is DENIED. The Court of Appeals
Resolutions dated June 29, 2005 and August 23, 2005 in CAG.R. SP No. 90076 denying admission of petitioners Petition
for Review are AFFIRMED.
Thus, respondents sought the execution of the judgment. On
11 April 2007, G.R. No. 169420 became final and executory. 4
Apparently not wanting to be bound by this Courts Decision
in G.R. No. 169420, petitioners Erlando and Joena
subsequently filed with the Court of Appeals (CA) a Petition
for Annulment of Judgment with prayer for the issuance of a
writ of preliminary injunction and/or temporary restraining
order, docketed as CA-G.R. SP No. 98679. The Petition for
Annulment of Judgment assailed the merits of the RTCs

Decision in Civil Case Nos. Q-01-42948 and Q-01-42959,


subject of G.R. No. 169420. In that Petition for Annulment,
Petitioners raised the following grounds:
I. The lower court erred in concluding that both petitioners
and respondents did not present direct documentary
evidence to substantiate [their] respective claims.
II. The lower court erred in concluding that both
petitioners and respondents relied mainly on testimonial
evidence to prove their respective position[s].
III. The lower court erred in not ruling that the real estate
transaction entered into by said petitioners and spouses
Roman and Amalia Aguzar was a personal transaction and
not a law partnership transaction.
IV. The lower court erred in ruling that the testimonies of
the respondents are credible.
V. The lower court erred in ruling that the purchase price
for the lot involved was P 3 million and not P 8 million.
VI. The lower court erred in ruling that petitioners retainer
agreement with Atlanta Industries, Inc. was a law
partnership transaction.
VII. The lower court erred when it failed to rule on said
petitioners permissive counterclaim relative to the
various personal loans secured by respondents.
VIII. The lower court not only erred in the exercise of its
jurisdiction but more importantly it acted without
jurisdiction or with lack of jurisdiction. 5
We note that petitioners were married on 28 May 1998. The
cases filed with the Securities and Exchange Commission
(SEC) on 6 May 1998 and 15 October 1998 were filed against
petitioner Erlando only. It was with the filing of CA-G.R. SP
No. 98679 on 24 April 2007 that Joena joined Erlando as a
co-petitioner.
On 26 April 2007, the CA issued a Resolution6 dismissing the
Petition. First, it reasoned that the remedy of annulment of
judgment under Rule 47 of the Rules of Court is available
only when the ordinary remedies of new trial, appeal,
petition for relief or other appropriate remedies are no
longer available through no fault of petitioners.7 Considering
that the dismissal of the appeal was directly attributable to
them, the remedy under Rule 47 was no longer available.
Second, the CA stated that the grounds alleged in the
Petition delved on the merits of the case and the
appreciation by the trial court of the evidence presented to
the latter. Under Rule 47, the grounds for annulment are
limited only to extrinsic fraud and lack of jurisdiction.
Lastly, the CA held that the fact that the trial court was not
designated as a special commercial court did not mean that
the latter had no jurisdiction over the case. The appellate
court stated that, in any event, petitioners could have raised
this matter on appeal or through a petition for certiorari
under Rule 65, but they did not do so.
Petitioners filed an Amended Petition for Annulment of
Judgment dated 2 May 2007, but the CA had by then already
issued the 26 April 2007 Resolution dismissing the Petition.
On 24 May 2007, the 26 April 2007 Resolution in CA-G.R. SP
No. 98679 became final and executory.8
Petitioners did not give up. They once again filed a 105-page
Petition for Annulment of Judgment with the CA dated 25
May 20079 docketed as CA-G.R. SP No. 99719. This time,
they injected the ground of extrinsic fraud into what
appeared to be substantially the same issues raised in CAG.R. SP No. 98679. The following were the grounds raised in
CA-G.R. SP No. 99719:

A. Extrinsic fraud and/or collusion attended the rendition of


the Consolidated Decision x x x based on the following
badges of fraud and/or glaring errors deliberately
committed, to wit:
I. The lower court deliberately erred in concluding that
both petitioners and respondents did not present direct
documentary evidence to substantiate their respective
claims, as it relied purely on the gist of what its personnel
did as regards the transcript of stenographic notes the
latter [sic] in collusion with the respondents.
II. The lower court deliberately erred in concluding that
both petitioners and respondents relied mainly on
testimonial evidence to prove their respective positions by
relying totally on what was presented to it by its
personnel who drafted the Consolidated Decision in
collusion with the respondents.
III. The lower court deliberately erred in not ruling that the
real estate transaction entered into by said petitioners and
spouses Roman and Amalia Aguzar was a personal
transaction and not a law partnership transaction for the
same reasons as stated in Nos. 1 and II above.
IV. The lower court deliberately erred in ruling that the
testimonies of the respondents are credible as against the
petitioner Erlando Abrenica and his witnesses for the same
reasons as stated in Nos. I and II above.
V. The lower court deliberately erred in ruling that the
purchase price for the lot involved was P 3 million and
not P 8 million for the same reasons as stated in Nos. 1
and II above.
VI. The lower court deliberately erred in ruling that
petitioners retainer agreement with Atlanta Industries,
Inc. was a law partnership transaction for the same
reasons as stated in Nos. 1 and II above.
VII. The lower court deliberately erred when it failed to
rule on said petitioners permissive counterclaim relative
to the various personal loans secured by respondents also
for the same reasons as the above.
B. As an incident of the extrinsic fraud[,] the lower court[,]
despite full knowledge of its incapacity[,]
rendered/promulgated the assailed Consolidated Decision x
x x without jurisdiction or with lack of
jurisdiction.10(Underscoring in the original.)
On 2 August 2007, the CA issued the first assailed
Resolution11 dismissing the Petition in CA-G.R. SP No. 99719,
which held the Petition to be insufficient in form and
substance. It noted the following:
x x x. Readily noticeable is that CA-G.R. SP No. 90076
practically contained the prayer for the annulment of the
subject consolidated Decision premised on the very same
allegations, grounds or issues as the present annulment of
judgment case.
xxx

xxx

xxx

Annulment of judgment is a recourse equitable in character,


allowed only in exceptional cases as where there is no
available or other adequate remedy (Espinosa vs. Court of
Appeals, 430 SCRA 96[2004]). Under Section 2 of Rule 47 of
the Revised Rules of Court, the only grounds for an
annulment of judgment are extrinsic fraud and lack of
jurisdiction (Cerezo vs. Tuazon, 426 SCRA 167 [2004]).
Extrinsic fraud shall not be a valid ground if it was availed of,
or could have been availed of, in a motion for new trial or
petition for relief.
xxx

xxx

xxx

x x x. In the case at bar, not only has the court a quo


jurisdiction over the subject matter and over the persons of
the parties, what petitioner is truly complaining [of] here is

only a possible error in the exercise of jurisdiction, not on the


issue of jurisdiction itself. Where there is jurisdiction over the
person and the subject matter (as in this case), the decision
on all other questions arising in the case is but an exercise
of the jurisdiction. And the errors which the court may
commit in the exercise of jurisdiction are merely errors of
judgment which are the proper subject of an appeal
(Republic vs. "G" Holdings, supra, citing Tolentino vs. Leviste,
supra). (Emphasis supplied.)
Subsequently, petitioners filed a Humble Motion for
Reconsideration12 on 28 August 2007.
While the 28 August 2007 motion was pending, on 13
September 2007, petitioner Erlando filed an Urgent Omnibus
Motion13 with Branch 226, alleging that the sheriff had levied
on properties belonging to his children and petitioner Joena.
In addition, Erlando alleged that the trial court still had to
determine the manner of distribution of the firms assets and
the value of the levied properties. Lastly, he insisted that the
RTC still had to determine the issue of whether the Rule 41
appeal was the correct remedy.
On the same day, Joena filed an Affidavit of Third Party
Claim14 also with Branch 226 of the RTC of Quezon City,
alleging that she15 and her stepchildren16 owned a number of
the personal properties sought to be levied. She also insisted
that she owned half of the two (2) motor vehicles as well as
the house and lot covered by Transfer Certificate of Title
(TCT) No. 216818, which formed part of the absolute
community of property. She likewise alleged that the real
property, being a family home, and the furniture and the
utensils necessary for housekeeping having a depreciated
combined value of one hundred thousand pesos (P 100,000)
were exempt from execution pursuant to Rule 39, Section 13
of the Rules of Court. Thus, she sought their discharge and
release and likewise the immediate remittance to her of half
of the proceeds, if any.
Accordingly, the RTC scheduled17 a hearing on the motion.
On 17 October 2007, however, petitioner Erlando moved to
withdraw his motion on account of ongoing negotiations with
respondents.18

Next, they assert that petitioner Joenas right to due process


was also violated when she was not made a party-in-interest
to the proceedings in the lower courts, even if her half of the
absolute community of property was included in the
execution of the judgment rendered by Branch 226 of the
RTC of Quezon City.
Finally, they insist that their Humble Motion for
Reconsideration was filed on time, since 27 August 2007 was
a holiday. Therefore, they had until 28 August 2007 to file
their motion.
Since then, it appears that a Sheriffs Certificate of Sale was
issued on 3 January 2008 in favor of the law firm for the sum
of P 5 million for the property covered by TCT No. 216818.
On 18 March 2009, while the case was pending with this
Court, petitioners filed a Complaint22 with a prayer for the
issuance of a writ of preliminary injunction before the RTC of
Marikina City against herein respondents and Sheriff Nardo I.
de Guzman, Jr. of Branch 226 of the RTC of Quezon City. The
case was docketed as Civil Case No. 09-1323-MK and was
raffled to Branch 273 of the RTC of Marikina
City.23 Petitioners sought the nullification of the sheriffs sale
on execution of the Decision in the consolidated cases
rendered by Branch 226, as well as the payment of
damages. They alleged that the process of the execution
sale was conducted irregularly, unlawfully, and in violation of
their right to due process.
On 2 July 2009, Branch 273 of the RTC of Marikina City
issued a Writ of Preliminary Injunction enjoining respondents
and/or their agents, and the Register of Deeds of Marikina
City from consolidating TCT No. 216818.24
The filing of the Complaint with the RTC of Marikina City
prompted respondents to file a Motion25 before us to cite for
contempt petitioner spouses and their counsel, Atty. Antonio
R. Bautista. This Motion was on the ground that petitioners
committed forum shopping when they filed the Complaint
pending with Branch 273 of the RTC of Marikina City, while
the present case was also still pending.

Thereafter, petitioner Erlando and respondent Abelardo


Tibayan, witnessed by Sheriff Nardo de Guzman, Jr. of
Branch 226 of the RTC of Quezon City, executed an
agreement to postpone the auction sale of the property
covered by TCT No. 216818 in anticipation of an amicable
settlement of the money judgment.19

Meanwhile, on 22 September 2009, respondents filed before


Branch 226 an Ex Parte Motion for Issuance of Writ of
Possession.26 That Motion was granted by Branch 226
through a Resolution27 issued on 10 November 2011. This
Resolution then became the subject of a Petition for
Certiorari28 under Rule 65 filed by petitioners before the CA
docketed as CA-G.R. SP No. 123164.

Finally, on 30 October 2007, the CA in CA-G.R. SP No. 99719


issued the second assailed Resolution20 denying petitioners
Motion for Reconsideration for having been filed out of time,
as the last day for filing was on 27 August 2007. Moreover,
the CA found that the grounds stated in the motion were
merely recycled and rehashed propositions, which had
already been dispensed with.

Soon after, on 6 March 2012, petitioners filed with the CA an


Urgent Motion for Issuance of Temporary Restraining Order
(T.R.O.)29 after Sheriff De Guzman, Jr. served on them a
Notice to Vacate within five days from receipt or until 11
March 2012. As of the writing of this Decision, the CA has
not resolved the issue raised in the Petition in CA-G.R. SP No.
123164.

Petitioners are now assailing the CA Resolutions dated 2


August 2007 and 30 October 2007, respectively, in CA-G.R.
SP No. 99719. They insist that there is still a pending issue
that has not been resolved by the RTC. That issue arose from
the Order21 given by the trial court to petitioner Erlando to
explain why it should take cognizance of the Notice of
Appeal when the proper remedy was a petition for review
under Rule 43 of the Rules of Court.

Our Ruling
Petitioners elevated this case to this Court, because they
were allegedly denied due process when the CA rejected
their second attempt at the annulment of the Decision of the
RTC and their Humble Motion for Reconsideration.
We DENY petitioners claims.

Further, petitioners blame the trial and the appellate courts


for the dismissal of their appeal despite this Courts
explanation in G.R. No. 169420 that the appeal was the
wrong remedy and was thus correctly dismissed by the CA.
Instead of complying with the show-cause Order issued by
the RTC, petitioners went directly to the CA and insisted that
the remedy they had undertaken was correct.
Petitioners also contend that there was extrinsic fraud in the
appreciation of the merits of the case. They raise in the
present Petition the grounds they cited in the three (3)
Petitions for Annulment of Judgment (including the Amended
Petition) quoted above.

The rules of procedure were formulated to achieve the ends


of justice, not to thwart them. Petitioners may not defy the
pronouncement of this Court in G.R. No. 169420 by pursuing
remedies that are no longer available to them. Twice, the CA
correctly ruled that the remedy of annulment of judgment
was no longer available to them, because they had already
filed an appeal under Rule 41. Due to their own actions, that
appeal was dismissed.
It must be emphasized that the RTC Decision became final
and executory through the fault of petitioners themselves
when petitioner Erlando (1) filed an appeal under Rule 41
instead of Rule 43; and (2) filed a Petition for Review directly

with the CA, without waiting for the resolution by the RTC of
the issues still pending before the trial court.

hope that even as one case in which a particular remedy


is sought is dismissed, another case (offering a similar
remedy) would still be open," or

In Enriquez v. Court of Appeals,30 we said:


It is true that the Rules should be interpreted so as to give
litigants ample opportunity to prove their respective claims
and that a possible denial of substantial justice due to legal
technicalities should be avoided. But it is equally true that
an appeal being a purely statutory right, an appealing party
must strictly comply with the requisites laid down in the
Rules of Court. In other words, he who seeks to avail of the
right to appeal must play by the rules. x x x. (Emphasis
supplied.)
With regard to the allegation of petitioner Joena that her
right to due process was violated, it must be recalled that
after she filed her Affidavit of Third Party Claim on 13
September 2007 and petitioner Erlando filed his Urgent
Omnibus Motion raising the same issues contained in that
third-party claim, he subsequently filed two Motions
withdrawing his Urgent Omnibus Motion. Petitioner Joena,
meanwhile, no longer pursued her third-party claim or any
other remedy available to her. Her failure to act gives this
Court the impression that she was no longer interested in
her case. Thus, it was through her own fault that she was not
able to ventilate her claim.
Furthermore, it appears from the records that petitioner
Erlando was first married to a certain Ma. Aline Lovejoy
Padua on 13 October 1983. They had three children: Patrik
Erlando (born on 14 April 1985), Maria Monica Erline (born
on 9 September 1986), and Patrik Randel (born on 12 April
1990).
After the dissolution of the first marriage of Erlando, he and
Joena got married on 28 May 1998.31 In her Affidavit, Joena
alleged that she represented her stepchildren; that the
levied personal properties in particular, a piano with a
chair, computer equipment and a computer table were
owned by the latter. We note that two of these stepchildren
were already of legal age when Joena filed her Affidavit. As
to Patrik Randel, parental authority over him belongs to his
parents. Absent any special power of attorney authorizing
Joena to represent Erlandos children, her claim cannot be
sustained.
Petitioner Joena also asserted that the two (2) motor
vehicles purchased in 1992 and 1997, as well as the house
and lot covered by TCT No. 216818 formed part of the
absolute community regime.1wphi1 However, Art. 92, par.
(3) of the Family Code excludes from the community
property the property acquired before the marriage of a
spouse who has legitimate descendants by a former
marriage; and the fruits and the income, if any, of that
property. Neither these two vehicles nor the house and lot
belong to the second marriage.
We now proceed to discuss the Motion for contempt filed by
respondents.
Respondents claim that petitioners and their present
counsel, Atty. Antonio R. Bautista, were guilty of forum
shopping when the latter filed Civil Case No. 09-1323-MK
with the RTC of Marikina City while the case was still pending
before us. In Executive Secretary v. Gordon,32 we explained
forum shopping in this wise:
Forum-shopping consists of filing multiple suits involving the
same parties for the same cause of action, either
simultaneously or successively, for the purpose of obtaining
a favorable judgment. Thus, it has been held that there is
forum-shopping
(1) whenever as a result of an adverse decision in one
forum, a party seeks a favorable decision (other than by
appeal or certiorari) in another, or
(2) if, after he has filed a petition before the Supreme
Court, a party files another before the Court of Appeals
since in such case he deliberately splits appeals "in the

(3) where a party attempts to obtain a preliminary


injunction in another court after failing to obtain the same
from the original court.
Civil Case No. 09-1323-MK was filed to question the
proceedings undertaken by the sheriff in executing the
judgment in Civil Case Nos. Q01-42948 and Q01-42959. On
the other hand, the present case questions the merits of the
Decision itself in Civil Case Nos. Q01-42948 and Q01-42959.
These cases have different causes of action. Thus, it cannot
be said that petitioners were clearly guilty of forum shopping
when they filed the Complaint before the RTC of Marikina
City.
WHEREFORE, in view of the foregoing, the Petition is hereby
DENIED. The Resolutions dated 2 August 2007 and 30
October 2007 issued by the Court of Appeals in CA-G.R. SP
No. 99719 are AFFIRMED.
SO ORDERED.

G.R. No. 2904

January 11, 1907

LUIS LIM, administrator, plaintiff-appellant,


vs.
ISABEL GARCIA, widow of Hilario Lim, defendantappellee.
Marshall Dawson for appellant.
F. W. Redding for appellee.
CARSON, J.:
This is an appeal from an order of the Court of First Instance
of Zamboanga distributing the estate of Hilario Lim,
deceased, on the consolidated petition of Luis Lim,
administrator, the children of Hilario Lim, deceased, and the
defendant Isabel Garcia, his widow.
Hilario Lim died intestate some time in the year 1903,
leaving a widow and nine children and an interest in an
estate valued at some 50,000 pesos.
The trial court was of opinion that the entire estate as shown
in the inventory prepared by the administrator was conjugal
property, except a house and lot on Calle Magallanes,
Zamboanga, and the sum of 10,000 pesos which, it was
admitted, had been brought to the marriage by the said
Hilario Lim, and except, furthermore, 700 pesos, the
purchase price paid by said Lim for a certain lot which it was
also admitted had been brought by him to his marriage, and
which was sold in the course of the administration of his
estate, together with the improvements made thereon
during the period of coverture.
Counsel for the administrator, and for the surviving children,
contends that none of the said property should be treated as
the property of the conjugal partnership, because, as they
allege, the deceased Hilario Lim, brought to the marriage
property worth more than double the amount of the
intestate estate, and the defendant, his widow, brought
nothing to the conjugal partnership, either at the time of the
marriage or at any time thereafter.
The trial court was of opinion that the evidence offered in
support of this contention was no sufficient to overcome the
presumption established in article 1407 of the Civil Code,
which provides that all the estate of the married couple will
be considered as conjugal partnership property (bienes
gananciales) unless and until it is proven that it is a part of
the separate estate of the husband or the wife, and we think
after a careful examination of the record that this finding
must be sustained.

her husband, and that they were in fact conveyed to her by


third parties by way of exchange for certain property
inherited by her from her father's estate during the
coverture, and they are, therefore, her separate property
under the provisions of paragraph 3 of article 1396, which
provides that property acquired by exchange for other
property belonging separately to one of the married couple
is the separate property of the owner of the property for
which it is exchanged.
The trial court speaks of this property as dowry of the
appellee, but there is nothing in the record which tends to
prove that it was acquired as a part of her dowry, and
indeed the evidence strongly supports the presumption that
it was and continued to be a part of her separate estate
(paraphernalia) which never acquired the "dotal" character.
For the purpose of this decision, however, it is not necessary
to determine the precise character of the estate of the
appellee in this property because there can be no double
that it was her separate estate, and whether dowry or
paraphernalia, the trial court properly excluded it from the
inventory of the property of the deceased which was to be
distributed among his legitimate heirs.
No error was assigned by either party touching the amount
of the usufructuary interest in the estate of her husband
allowed to the widow by the trial court, and we can not,
therefore, review the action of the trial court in this
connection.
The judgment of the trial court should be and is hereby
affirmed, with the costs of this instance against the
appellant. After the expiration of twelve days let judgment
be entered in accordance herewith and ten days thereafter
the record remanded to the court below for proper action. So
ordered.

G.R. No. L-3629

September 28, 1907

MATEA E. RODRIGUEZ, plaintiff-appellant,


vs.
SUSANA DE LA CRUZ, ESCOLASTICO DE LA CRUZ, AND
PROCESA DE LA CRUZ, defendants-appellees.
Chicote and Miranda, for appellant.
Leoncio Imperial and Carlos Imperial, for appellees.
JOHNSON, J.:

The foregoing disposes of all the errors assigned by counsel


for the appellant, except the alleged error of the trial court in
refusing to order the inclusion in the inventory of the estate
of the deceased of three parcels of land, held in the name of
the appellee and claimed as her separate estate. It is
contended by the appellant that these parcels of land were
conveyed to the appellee during the coverture by the said
Hilario Lim either as a gift or for valuable consideration, and
that in either in event such conveyance was void under the
provisions of articles 1334 and 1458 of the Civil Code.

On the 21st day of August, 1905, the plaintiff, through her


attorneys, filed an amended complaint in the Court of First
Instance of the Province of Albay for the purpose of
recovering from the defendant certain pieces or parcels of
land described in the complaint, alleging: That she was the
owner of the said lands; that she had acquired said lands
during her first marriage from her deceased father, Alejo
Rodriguez; that Hilarion de la Cruz was her second husband
and that she had permission from him to commence this
action in her own name against the said defendant; that she
had been in possession of said lands and enjoyed the fruits
of the same, from the month of May, 1882, until the month
of February, 1905; that the said Hilarion de la Cruz had no
interest or right in said property; that on or about the 20th of
February 1905, the defendants in the cause commenced an
action in the Court of First Instance of the Province of Albay
against the said Hilarion de la Cruz for the partition of the
lands described in the present cause; that on the 29th day of
March, 1905, the judge of the said court adjudged in favor of
the defendant Susana de la Cruz in this action the ownership
and possession of the lands described under letter "B" in the
complaint in this cause adjudging and decreeing the
ownership and possession of lands described in letter "A" in
this complaint to Escolastico de la Cruz; that the plaintiff in
this cause was not made a party in the action for partition
between the present defendants and the said Hilarion de la
Cruz.

It appears from the evidence, however, that these parcels of


land were not acquired by the appellee by conveyance from

To this petition the defendants filed a special denial, denying


certain parts of the facts set out in the complaint and

The setting aside of 700 pesos (which appears to have been


taken as the value of the lot sold during the administration)
as the separate property of the husband who brought the lot
to the marriage, and the treatment of the balance of the
price received for this lot, together with the buildings
thereon, as conjugal partnership property, it appearing from
the record that these buildings were constructed out of the
conjugal partnership funds, was in entire accordance with
the provisions of article 1404, which provides that "the
buildings erected during coverture on land belonging to one
of the married couple will be considered as conjugal
partnership property, after allowing the owner of the land
the value thereof."

admitting certain other of the facts alleged in said


complaint. As a special defense the defendants set up the
judgment of the Court of First Instance of the Province of
Albay of the 29th of March, 1905.
The issue thus formed was duly submitted to the lower
court, and after hearing the evidence the lower court
rendered a judgment in favor of the defendants and against
the plaintiff, dismissing the said cause with costs to the
plaintiff. The lower court found as a fact from the evidence
adduced during the trial that the lands described in the
complaint were acquired by Hilarion de la Cruz, the father of
the present defendants, "during his married life with his first
wife, Andrea de Leon," and that said lands were not
inherited by the present defendant from her father, Alejo
Rodriguez.

With reference to the third assignment of error above noted,


we are of the opinion, and so hold, after an examination of
the evidence adduced during the trial of said cause, that the
said lands in question were acquired by Matea E. Rodriguez
by inheritance during the existence of her first marriage,
from her deceased father, Alejo Rodriguez.
Therefore, from all the foregoing facts, we are of the opinion
that the judgment of the lower court should be reversed, and
it is hereby ordered that the said cause be remanded to the
lower court with direction that a judgment be entered
declaring that the said plaintiffs, Matea E. Rodriguez, is the
owner and is entitled to the possession, as against the said
defendants, of the lands described i the amended complaint
presented in this cause.
Without any finding as to costs, it is so ordered.

From this decision the plaintiff appealed to this court,


alleging that the lower court committed errors, in substance
as follows:
1. That the lower court erred in considering the fact that the
said Matea E. Rodriguez did not intervene in said action for
partition between the said Hilarion de la Cruz and his
children of the first marriage as sufficient to show that she
had no interest in the lands in question.
2. That the court erred in declaring that the said Hilarion de
la Cruz was the owner of the lands in question, for simple
fact that he had been administering said lands during the
entire period of his marriage with the present plaintiff.
3. That the court erred in finding from the evidence that the
said Hilarion de la Cruz has acquired said lands during the
existence of his marriage relation with the said Andrea de
Leon, his first wife, and that said lands were not inherited by
the present plaintiff from her deceased father.
With reference to the first assignment of error above noted,
we are of the opinion, and so hold, that for the reason that
the said Matea E. Rodriguez had not been made a party in
the action for partition between the present defendants and
the said Hilarion de la Cruz, her interest in said lands was in
no way prejudiced by the decision of the court in that cause.
Section 277 of the Code of Civil Procedure in Civil Actions
provides, among other things, that proceedings in a cause
against one person can not affect the rights of another.
It is admitted by the parties in the present action that the
said Matea E. Rodriguez was not made a party in the former
action for the partition between the present defendants and
the said Hilarion de la Cruz, neither is it shown that she had
any knowledge or information concerning the existence or
pendency of said action.,
With reference of the second assignment of error above
noted, it is admitted that soon after the marriage of the said
Hilarion de la Cruz with the present plaintiff he commenced
to administer the property in question. There is no provision
in the Civil Code which prohibits a husband from
administering the property of his wife, as her representative,
and certainly it can not be concluded that the property
which he administers for his wife is his for the mere reason
that he has administered the same for a long time.
Article 1382 of the Civil Code provides that the wife shall
retain the ownership of her property which she brings to the
marriage relation. It is true that article 1384 prescribes that
she shall have the management of the property, unless she
was delivered the same to her husband by means of a public
document, providing that he may administer said property;
but it can not be claimed; from the mere fact that she has
permitted her husband to administer her property without
having his authority to do so evidenced by a public
document, that she has thereby lost her property and that
the same has become the property of her husband. No such
claim was made in the court below on behalf of the
defendants. Their claim was that the said Hilarion de la Cruz
had acquired said property during the existence of his
marriage with his first wife, Andrea de Leon.

[G.R. No. 41278. May 5, 1934.]


PEOPLE BANK AND TRUST CO., Petitioner-Appellant,
v. THE REGISTER OF DEEDS FOR THE CITY OF
MANILA, Respondent-Appellee.
Gibbs & McDonough and Roman Ozaeta
for Appellant.
Acting Solicitor-General Pea for Appellee.
SYLLABUS
1. CONTRACTS; TRUST. D. A., a married woman, without
permission of her husband, conveyed in trust to the Peoples
Bank and Trust Co. her paraphernal property consisting of
lands and buildings the administration of which she had not
conferred upon her husband, for the following purposes: So
that the lands would be subdivided into small lots; that such
lots would be sold either for cash or by installment; that the
trustee would redeem the mortgage constituted on the
property with funds a loan of P10,000 with which to redeem
the mortgage in question; and that the said trustee would
collect the rents due on the property during the time the lots
remained unsold. Held: That under the deed of trust in
question the grantor did not part with nor alienate the rents
to be derived from the said property in favor of the trustee,
and therefore, the instrument thus executed is susceptible of
registration.
2. PARAPHERNAL PROPERTY NOT DELIVERED TO THE
HUSBAND BEFORE A NOTARY; MANAGEMENT. Pursuant to
the provisions of article 1384 of the Civil Code, the wife has
the management of the paraphernal property which has not
been delivered to her husband before a notary.
3. ID.; ID.; POWER OF THE WIFE TO DELEGATE
MANAGEMENT. Inasmuch as the wife has the
management of her paraphernal property which has not
been delivered to her husband, in accordance with article
1384 of the Civil Code, there is no question that she has the
right to collect the rents thereof and that she may delegate
such power to another person. To deny her such power
would be tantamount to converting her from an
administratrix into a mere collector of rents.
4. FRUITS OF PARAPHERNAL PROPERTY; MANAGEMENT. Pursuant to the provisions of articles 1385 and 1401 (3) of
the Civil Code, the husband has the management of the
fruits of paraphernal property on the ground that they
belong to the conjugal partnership of which he is the
administrator. However, inasmuch as under article 1384 of
the same Code the wife has the management of her
paraphernal property which she has not delivered to her
husband before a notary, it follows that while the fruits
thereof remain unliquidated they should continue under her
management on the ground that they answer for the
necessary and indispensable expenses for their
administration and preservation. Not till then does the
husband have the right to claim them for the conjugal
partnership of which he is the exclusive legal administrator.
5. PARAPHERNAL PROPERTY; PROHIBITION OF ARTICLE 1387
OF THE CIVIL CODE. Failure to comply with the requisite
prescribed in article 1387 of the Civil Code, which was in
force before the promulgation of Act No. 3922 of the
Philippine Legislature, does not render the contract,
executed by the wife without permission of her husband, null
and void ab initio but merely voidable, and the right of
action which may arise under such circumstances
exclusively belongs to the husband or his heirs. Wherefore,
even granting that such public instrument is defective, it is,
nevertheless, susceptible of registration.

DECISION
IMPERIAL, J.:
This is an appeal taken by the Peoples Bank and Trust Co.
from the judgment rendered by the Court of First Instance of
Manila, denying the registration of a certain instrument
entitled "Agreement and Declaration of Trust."
The undisputed facts of the case may be summarized as
follows:chanrob1es virtual 1aw library
On October 26, 1933, Dominga Angeles, married to Manuel
Sandoval who resides in Palawan and from whom she lives
separate and apart, executed an instrument entitled
"Agreement and Declaration of Trust" in favor of the Peoples
Bank and Trust Co. whereby she conveyed in trust her
paraphernal property consisting of three (3) parcels of land
together with two (2) buildings thereon, situated at Nos.
1989 and 1993 Juan Luna, Manila, particularly described in
transfer certificate of title No. 21661 issued in her name. The
said trust was constituted in order that the lands would be
subdivided into small lots; that said lots would be sold either
for cash or by installments; that the trustee would redeem
the mortgage constituted on said property with funds
derived from the rents or sale thereof; that the trustee would
grant a loan of P10,000 with which to redeem the mortgage
in question; and that the said trustee would collect the rents
to be derived from said property while the lots remained
unsold.
The instrument was presented to the register of deeds for
the City of Manila for registration, which was denied by the
said official. Whereupon the Peoples Bank and Trust Co.
brought the matter in consulta before the Court of First
Instance of Manila, which on January 5, 1934, sustained the
action of the register of deeds and denied the registration
applied for.
The trial court based its decision on the alleged ground that
according to the terms of the contract the trustee was
authorized to collect the fruits of the paraphernal property
while the lots remained unsold or unalienated to other
persons in the manner above stated, and, inasmuch as
under the provisions of articles 1385 and 1401 (3) of the
Civil Code such fruits are considered conjugal partnership
property, the management of which corresponds to the
husband, in accordance with article 1412 of the said Code,
and said husband did not intervene in nor give his consent
to the instrument in question, the same is null and void and,
therefore, not susceptible of registration.
The appellant contends that pursuant to the provisions of
article 1387 of the Civil Code, as amended by section 1 of
Act No. 3922 of the Philippine Legislature, the grantor
Dominga Angeles did not need marital consent thereto and,
therefore, the instrument is valid and susceptible of
registration.
The question raised in this appeal does not require
interpretation nor application of the provisions of Act No.
3922, amending article 1387 of the Civil Code. For the
purposes of this decision it is taken for granted that, in
accordance with the provisions of articles 1385 and 1401 (3)
of the Civil Code, the fruits of the paraphernal property,
which had been conveyed in trust, belong to the conjugal
partnership, the management of which corresponds
exclusively to the husband of the grantor (article 1412).
It should be borne in mind that according to the deed of
trust the grantor neither parts with nor conveys the rents of
her paraphernal property in favor of the trustee but merely
authorizes it to collect them during the time the lots remain
unsold. The authority thus conferred only constitutes a mere
act of administration which article 1384 expressly vests
upon the grantor, in the instant case involving paraphernal
property which she has not delivered to her husband before
a notary, for the purpose of conferring its management upon
him. The article in question reads as
follows:jgc:chanrobles.com.ph
"ART. 1384. The wife shall have the management of the
paraphernal property unless she has delivered the same to
her husband before a notary, for the purpose of conferring
its management upon him.
"In such cases it shall be the duty of the husband to execute
a mortgage for the value of any personality which may be so
delivered to him or otherwise secure it in the manner
prescribed with respect to dowry property."cralaw virtua1aw
library
If the grantor is the legal administratrix of the property in

question, there can be no question that she has the right to


collect the fruits thereof and that she may, as she has done
in this case, delegate such power to other persons. To deny
her such right would be tantamount to converting her from
administratrix thereof into a mere collector of rents.
To the wife belongs the management of the fruits of her
paraphernal property, which has not been delivered to her
husband under the formalities prescribed by the law, while
such fruits remain unliquidated, on the ground that they
answer for the necessary and indispensable expenses
incurred in the administration and preservation of the
property. Not till then does the husband acquire the right to
claim them for the conjugal partnership of which he is the
sole administrator. Applying this principle to the case under
consideration, it becomes evident that the grantors
husband cannot claim the fruits in question for their conjugal
partnership until a liquidation thereof has been made by
her.
On the other hand, failure to comply with the requisite
prescribed in article 1387 does not render the contract null
and void ab initio but merely voidable, and the right of
action which may arise under such circumstances
exclusively belongs to the husband or his heirs. Wherefore,
even granting that such public instrument is defective, it is,
nevertheless, susceptible of registration.
What we have heretofore stated finds support in the
following commentaries of Manresa:jgc:chanrobles.com.ph
"Fortunately there is already a decision of the Supreme
Court to that effect. The doctrine is sufficiently explicit. A
married woman, actually living separate from her husband,
leases her paraphernal property, collects rents and appoints
administrators thereof, without marital consent. The
husband claims that such acts demand his permission as an
indispensable requisite. The trial court absolves the wife
and, upon appeal, it is held, on November 8, 1898, that the
management of paraphernal property conferred upon the
wife by article 1384 of the Civil Code carries with it the
power to enter into contracts regarding the same, subject
only to the limitation contained in article 1387, the wife
personally defraying the expenses incurred therein as a
consequence, without prejudice to the liabilities to which
such property is subject, in accordance with the provisions of
article 1385.
"Later, the decision of October 16, 1918, held that the
management of the paraphernal property by the wife should
be conducted in accordance with the provisions of article
1384 of the Civil Code, which only differs from the former
law in that for such acts and contracts executed in
connection with said management the wife does not need
marital consent. This management should not be understood
as limited by the law merely to gathering fruits and
collecting rents and interest thereon and delivering them to
the husband, for that would be tantamount to converting the
wife from an administratrix into a mere collector of rents of
the paraphernal property, which is one of the manifold acts
embraced by the administration, and which, on the other
hand, is compatible with the provisions of article 1385.
"Finally, the decision of January 14, 1928, ratifies this same
doctrine and holds that the prohibition contained in article
1387 cannot, from its very nature, be interpreted except in a
restrictive manner, by reason of which the wife may legally
perform every act not intended to alienate, mortgage or
otherwise encumber her paraphernal property, she being
authorized to execute contracts arising from the
administration of an estate, and consequently to obtain
loans, without marital consent, for the benefit of said
property.
"From the foregoing, we may conclude that, although the
Civil Code has not solved this question at issue explicitly and
definitely, the most logical interpretation that can be given
to article 1384, in connection with article 1387, is that which
grants the wife complete freedom in the management of her
paraphernal property and renders marital consent as
unnecessary, except for acts expressly stated in articles
1387, 995 and 1053. The exceptions contained in articles 61
and 1263, although vague and broad in scope, agree with
this solution inasmuch as in the last analysis they admit of
cases in which a married woman does not need marital
consent. Such broadness leaves enough ground to suppose
that the aforesaid cases include the management granted
the wife by article 1384.
x
x
x
"The consent of the husband has the same meaning in
article 1387 as in all the other articles of the Code which
demand this requisite. It does not merely fill up any defect in

the capacity of a woman to contract and bind herself. It is a


very personal power granted the head of the family to
maintain good order therein, as affirmed by the Registry
Office, or to avoid loss or damages that the conjugal
partnership might suffer without such intervention, as
affirmed by the Supreme Court. (Resolution of January 24,
1898, and decisions of June 27, 1866, and January 30,
1872.)
"Lack of marital consent does not render the act null and
void but merely voidable at the instance of the husband or
of his heirs. Hence the admission for registration nowadays
of contracts executed by the wife without such requisite,
stating such circumstance therein, as we have declared at
the end of the commentary on article 65, second edition of
this work. (Resolutions of November 23, 1892, August 22,
1894, and March 31, 1898.)" (Manresa, vol. IX, pp. 433, 434,
448, Fourth Edition.)
x

"Article 62 declares null and void the acts executed by the


wife without the consent of her husband in cases where such
consent is a necessary requisite. However, according to the
legal provision just considered, only the husband and his
heirs may avoid such acts, which is but logical and natural,
considering the spirit of the legal provision in question. From
the foregoing and applying the Civil Marriage Law and the
former laws which accepted the same doctrine, the Supreme
Court, in its decisions of June 27, 1866, January 30, 1872,
and November 14, 1862, held that acts performed by a
married woman without permission of her husband are not
null and void but merely voidable, at the instance of the
husband or his heirs, on the ground that the legal prohibition
in question was not established in favor of third persons but
with a different end or purpose, that is, in favor of the
husband whom the law wants to protect from possible
damages to the conjugal partnership of which he is the
head.
"After the Civil Code went into effect, the General Registry
Office accepted the same doctrine and even considered acts
and contracts, executed by a married woman without
permission of her husband, susceptible of registration as
long as such circumstance was stated in the record, to serve
as notice to third persons who might later contract with
regard to the same property. (Resolutions of November 23,
1892 and August 22, 1894.) It would seem that this doctrine
is contradicted by those established on January 24, 1898,
March 29, 1901, and April 21, 1908, but the principal
question raised in the first case was whether or not the
husband could authorize a third person to give such consent,
while in the second and third cases no statement was made
to the effect that the contracts was not registerable, nor
much less null and void, but that the deed was not extended
by the notary, who instituted the appeal, in accordance with
the provisions of the law. On March 31, 1898, the General
Registry Office reiterated its views in favor of registration
notwithstanding the lack of the requisite of marital
consent."cralaw virtua1aw library
Wherefore, the decision appealed from is hereby reversed,
and the register of deeds for the City of Manila is hereby
ordered to register the instrument in question, upon
payment of the corresponding legal fees, without special
pronouncement as to the costs. So ordered

G.R. No. L-23352

December 31, 1925

THE PHILIPPINE SUGAR ESTATES DEVELOPMENT CO.,


LTD., INC., plaintiff-appellee,
vs.
JUAN M. POIZAT, ET AL., defendants.
GABRIELA ANDREA DE COSTER, appellant.
Antonio M. Opisso for appellant.
Eusebio Orense and Fisher, DeWitt, Perkins & Brady for
appellee.
STATEMENT
August 25, 1905, the appellant, with his consent executed to
and in favor of her husband, Juan M. Poizat, a general power
of attorney, which among other things, authorized him to do
in her name, place and stead, and making use of her rights
and actions, the following things:

To loan or borrow any amount in cash or fungible


conditions he may deem convenient collecting or paying
the principal or interest, for the time, and under the
principal of the interest, when they respectively should or
private documents, and making there transactions with or
without mortgage, pledge or personal securities.
November 2, 1912, Juan M. Poizat applied for and obtained
from the plaintiff a credit for the sum of 10,000 Pounds
Sterling to be drawn on the" Banco Espanol del Rio de la
Plata" in London not later than January, 1913. Later, to
secure the payment of the loan, he executed a mortgage
upon the real property of his wife, the material portions of
which are as follows:
This indenture entered into the City of Manila, P.I., by and
between Juan M. Poizat, merchant, of legal age, married
and residing in the City of Manila, in his own behalf and in
his capacity also as attorney in fact of his wife Dona
Gabriela Andrea de Coster by virtue of the authority
vested in him by the power of attorney duly executed and
acknowledge in this City of Manila, etc.
First. That in the name of Dona Gabriela Andrea de Coster,
wife of Don Juan M. Poizat, there is registered on page 89
(back) of Book 3, Urban Property consisting of a house and
six adjacent warehouse, all of strong material and
constructed upon her own land, said property being Nos.
5, 3, and 1 of Calle Urbiztondo, and No. 13 of Calle Barraca
in the District of Binondo in the City of Manila, etc.
Second. That the marriage of Don Juan M. Poizat and Dona
Gabriela Andrea de Coster being subsisting and
undissolved, and with the object of constructing a new
building over the land hereinabove described, the
aforesaid house with the six warehouse thereon
constructed were demolished and in their stead a building
was erected, by permission of the Department of
Engineering and Public Works of this City issued November
10, 1902, said building being of strong material which,
together with the land, now forms only one piece of real
estate, etc; which property must be the subject of a new
description in which it must appear that the land belongs
in fee simple and in full ownership as paraphernal
property to the said Dona Gabriela Andrea de Coster and
the new building thereon constructed to the conjugal
partnership of Don Juan M. Poizat and the said Dona
Gabriela Andrea de Coster, etc.
Third. That the Philippine Sugar Estates Development
Company, Ltd., having granted to Don Juan M. Poizat a
credit of Ten Thousand Pounds Sterling with a mortgage
upon the real property above described, etc.
(a) That the Philippine sugar Estated Development
Company, Ltd. hereby grants Don Juan M. Poizat a credit in
the amount of Ten Thousand Pounds sterling which the
said Mr. Poizat may use within the entire month of January
of the coming year, 1913, upon the bank established in
the City of London, England, known as 'Banco Espanol del
Rio de la Plata, which shall be duly advised, so as to place
upon the credit of Mr. Poizat the said amount of Ten
Thousand Pounds Sterling, after executing the necessary
receipts therefore.
(c) That Don Juan M. Poizat personally binds himself and
also binds his principal Dona Gabriela Andrea de Coster to
pay the Philippine Sugar Estates Development Company,
Ltd., for the said amount of Ten Thousand Pounds Sterling
at the yearly interest of 9 per cent which shall be paid at
the end of each quarter, etc.
(d) Don Juan M. Poizat also binds himself personally and
his principal Dona Gabriela Andrea de Coster to return to
the Philippine Sugar Estates Development Company, Ltd.,
the amount of Ten Thousand Pounds Sterling within four
years from the date that the said Mr. Poizat shall receive
the aforesaid sum as evidenced by the receipt that he
shall issue to the 'BAnco Espanol del Rio de la Plata.'
(e) As security for the payment of the said credit, in the
case Mr. Poizat should receive the money, together with its

interest hereby constitutes a voluntary especial mortgage


upon the Philippine Sugar Estates Development Company,
Ltd., f the urban property above described, etc.
(f) Don Juan M. Poizat in the capacity above mentioned
binds himself, should he receive the amount of the credit,
and while he may not return the said amount of Ten
thousand Pounds Sterling to the Philippine Sugar Estates
Development Company, Ltd., to insure against fire the
mortgaged property in an amount not less than One
hundred Thousand Pesos, etc.
Fourth. Don Buenaventura Campa in the capacity that he
holds hereby accepts this indenture in the form, manner,
and condition executed by Don Juan M. Poizat by himself
personally and in representation of his wife Dona Gabriela
Andrea de Coster, in favor of the Philippine Sugar Estates
Development Company, Ltd.,
In witness whereof, we have signed these presents in
Manila, this November 2, 1912.
(Sgd.) JUAN M. POIZAT
THE PHILIPPINE SUGAR ESTATES
DEVELOPMENT COMPANY, LTD.
The President
BUENAVENTURA CAMPA
Signed in the presence of:
(Sgd.) MANUEL SAPSANO
JOSE SANTOS
UNITED STATES OF AMERICA
PHILIPPINE ISLANDS
CITY OF MANILA
In the City of Manila P.I., this November 2, 1912, before
me Enrique Barrera y Caldes, a Notary Public for said city,
personally appeared before me Don Juan M. Poizat and
Don Buenaventura Campa, whom i know to be the persons
who executed the foregoing document and acknowledged
same before me as an act of their free will and deed; the
first exhibited to me his certificate of registry No. 14237,
issued in Manila, February 6, 1912, the second did not
exhibit any cedula, being over sixty years old; this
document bears No. 495, entered on page 80 of my
Notarial registry.
Before me:
(Sgd.) Dr. ENRIQUE BARRERA Y CALDES
[NOTARIAL SEAL]
Notary Public
Up to the 31st of December , 1912
For failure to pay the loan, on November 12, 1923, the
plaintiff brought an action against the defendants to
foreclose the mortgage. In this action, the summons was
served upon the defendant Juan M. Poizat only, who
employed the services of Antonio A. Sanz to represent the
defendants. The attorneys filed a general appearance for all
of them, and later an answer in the nature of a general
denial.
February 18, 1924, when the case was called for trial, Jose
Galan y Blanco in open court admitted all of the allegations
made in the compliant, and consented that judgment should
be rendered as prayed for . Later, Juan M. Poizat personally,
for himself and his codefendants, file an exception to the
judgment and moved for a new trial, which was denied
March 31, 1924.
August 22, 1924, execution was issued directing the sale of
the mortgaged property to satisfy the judgment.itc@alf
September 18, 1924, the property, which had an assessed
value of P342,685, was sold to the plaintiff for the sum of
P100,000.

September 23, 1924, and for the first time, the appellant
personally appeared by her present attorney, and objected
to the confirmation of the sale, among other things, upon
illegally executed, and is null and void, because the agent of
this defendant was not authorized to execute it. That there
was no consideration. That the plaintiff, with full knowledge
that J. M. Poizat was acting beyond the scope of his
authority, filed this action to subject the property of this
defendant to the payment of the debt which, as to appellant,
was not a valid contract. That the judgment was rendered by
confession when the plaintiff and J. M. Poizat knew that
Poizat was not authorized to confess judgment, and that the
proceeding was a constructive fraud. That at the time the
action was filed and the judgment rendered, this defendant
was absent from the Philippine Islands, and had no
knowledge of the execution of the mortgage. That after the
judgment of foreclosure became final and order of the sale
of the property was made, that this defendant for the first
time learned that he mortgage contract was tainted with
fraud, and that she first knew and learned of such things on
the 11th of September, 1924. That J. M. Poizat was not
authorized to bind her property to secure the payment of his
personal debts. That the plaintiff knew that the agent of the
defendant was not authorized to bind her or her property.
That the mortgage was executed to secure a loan of 10,000
Pounds which was not made to this defendant or for her
benefit, but was made to him personally and for the
personal use and benefit of J. M. Poizat.
Among other things, the mortgage in question, marked
Exhibit B, was introduced in evidence, and made a part of
the record.
All of such objections to the confirmation of the sale were
overruled, from which Gabriela Andrea de Coster appealed
and assigns the following errors:
I. The lower court erred in finding that Juan M. Poizat was,
under the power of attorney which he had from Gabriela
Andrea de Coster, authorized to mortgage her paraphernal
property as security for a loan made to him personally by
the Philippine Sugar Estates Development Company, Ltd.,
to him;
II. The lower court erred in not finding that under the
power of attorney, Juan M. Poizat had no authority to make
Gabriela Andrea de Coster jointly liable with him for a loan
of 10,000 pound made by the Philippine Sugar Estates
Development Co., Ltd., to him;
III. The lower court erred in not finding that the Philippine
Sugar Estates Development Company, Ltd., had
knowledge and notice of the lack of authority of Don Juan
M. Poizat to execute the mortgage deed Exhibit A of the
plaintiff;
IV. The lower court erred in holding that Gabriela Andrea
de Coster was duly summoned in this case; and in holding
that Attorney Jose Galan y Blanco could lawfully represent
her or could, without proof of express authority, confess
judgment against Gabriela Andrea de Coster;
V. The court erred in holding that the judgment in this case
has become final and res judicata;
VI. The court erred in approving the judicial sale made by
the sheriff at an inadequate price;
VII. The lower court erred in not declaring these
proceedings, the judgment and the sale null and void.

JOHNS, J.:
For the reasons stated in the decision of this court in the
Bank of the Philippine Islands vs. De Coster, the alleged
service of the summons in the foreclosure suit upon the
appellant was null and void. In fact, it was made on J. M.
Poizat only, and there is no claim or pretense that any
service of summons was ever made upon her. After service

was made upon him, the attorneys in question entered their


appearance for all of the defendants in the action, including
the appellant upon whom no service was ever made, and file
an answer for them. Later, in open court, it was agreed that
judgment should be entered for the plaintiff as prayed for in
its complaint.
The appellant contends that the appearance made by the
attorneys for her was collusive and fraudulent, and that it
was made without her authority, and there maybe some
truth in that contention. It is very apparent that t the
attorneys made no effort to protect or defend her legal
rights, but under our view of the case, that question is not
material to this decision.
The storm center of this case is the legal force and effect of
the real mortgage in question , by whom and for whom it
was executed, and upon whom is it binding, and whether or
not it is null and void as to the appellant.
It is admitted that the appellant gave her husband, J. M.
Poizat, the power of attorney in question, and that it is in
writing and speaks for itself. If the mortgage was legally
executed by her attorney in fact for her and in her name as
her act and deed, it would be legal and binding upon her and
her property. If not so executed, it is null and void.
It appears upon the face of the instrument that J. M. Poizat
as the husband of the wife, was personally a party to the
mortgage, and that he was the only persona who signed the
mortgage. and the he was the only person who signed the
mortgage. It does not appear from his signature that he
signed it for his wife or as her agent or attorney in fact, and
there is nothing in his signature that would indicate that in
the signing of it by him, he intended that his signature
should bind his wife. It also appears from the
acknowledgment of the instrument that he executed it as his
personal act and deed only, and there is nothing to show
that he acknowledge it as the agent or attorney in fact of his
wife, or as her act and deed.
The mortgage recites that it was entered into by and
between Juan M. Poizat in his own behalf and as attorney in
fact of his wife. That the record title of the mortgaged
property is registered in the name of his wife, Dona Gabriela
Andrea de Coster. That they were legally married, and that
the marriage between them has never been dissolved. That
with the object of constructing a new building on the land.
the six warehouses thereon were demolished, and that a
new building was erected. That the property is the subject of
a new registration in which it must be made to appear that
the land belongs in fee simple and in full ownership as the
paraphernal property of the wife, and that the new building
thereon is the property of the conjugal partnership. "That
the Philippine Sugar Estates Development Company, Ltd.,
having granted to Don Juan M. Poizat a credit of 10,000
Pounds Sterling with the mortgage upon the real property
above described," that the Development Company "hereby
grants Don Juan M. Poizat a credit in the amount of 10,000
Pounds Sterling which the said Mr. Poizat may use, etc." That
should he personally or on behalf of his wife use the credit
he acknowledges, that he and his principal are indebted to
the Development Company in the sum of 10,000 Pounds
Sterling which "they deem to have received as a loan from
the said commercial entity." That he binds himself and his
wife to pay that amount with a yearly interest of 9 per cent,
payable quarterly. That as security for the payment of said
credit in the case Mr. Poizat should receive the money at any
time, with its interest, "the said Mr. Poizat in the dual
capacity that above mentioned binds himself, should he
receive the amount of the credit."
It thus appears that at the time the power of attorney and
the mortgage were executed, Don Juan M. Poizat and
Gabriela Andrea de Coster were husband and wife, and that
the real property upon which the mortgage was her sole
property before her marriage, and that it was her
paraphernal property at the time the mortgage was
executed, and that the new building constructed on the land
was the property of the conjugal partnership.
The instrument further recites that the Development
Company "hereby grants Don Juan M. Poizat a credit in the

amount of 10,000 Pounds Sterling which the said Mr. Poizat


may use within the entire month of January of the coming
year, 1913." In other words, it appears upon the face of the
mortgage that the loan was made to the husband with
authority to use the money for his sole use and benefit. With
or without a power of attorney, the signature of the husband
would be necessary to make the instrument a valid
mortgage upon the property of the wife, even though she
personally signed the mortgage.
It is contended that the instrument upon its face shows that
its purpose and intent was to bind the wife. But it also shows
upon its face that the credit was granted to Don Juan M.
Poizat which he might use within the "entire month of
January."
Any authority which he had to bind his wife should be
confined and limited to his power of attorney.
Giving to it the very broadest construction, he would not
have any authority to mortgage her property, unless the
mortgage was executed for her "and in her name, place or
stead," and as her act and deed. The mortgage in question
was not so executed. it was signed by Don Juan M. Poizat in
his own name, his own proper person, and by him only, and
it was acknowledge by him in his personal capacity, and
there is nothing in either the signature or acknowledgment
which shows or tends to show that it was executed for or on
behalf of his wife or "in her name, place or stead."
It is contended that the instrument shows upon its face that
it was intended to make the wife liable for his debt, and to
mortgage her property to secure its payment, and that his
personal signature should legally be construed as the joined
or dual signature of both the husband and that of the wife as
her agent. That is to say, construing the recitals in the
mortgage and the instrument as a whole, his lone personal
signature should be construed in a double capacity and
binding equally and alike both upon the husband and the
wife. No authority has been cited, and none will ever be
found to sustain such a construction.
As the husband of the wife, his signature was necessary to
make the mortgage valid. In other words, to make it valid, it
should have been signed by the husband in his own proper
person and by him as attorney in fact for his wife, and it
should have been executed by both husband and wife, and
should have been so acknowledged.
There is no principle of law by which a person can become
liable on a real mortgage which she never executed either in
person or by attorney in fact. It should be noted that this is a
mortgage upon real property, the title to which cannot be
divested except by sale on execution or the formalities of a
will or deed. For such reasons, the law requires that a power
of attorney to mortgage or sell real property should be
executed with all of the formalities required in a deed. For
the same reason that the personal signature of Poizat,
standing alone, would not convey the title of his wife in her
own real property, such a signature would not bind her as a
mortgagor in real property, the title to which was in her
name.
We make this broad assertion that upon the facts shown in
the record, no authority will ever be found to hold the wife
liable on a mortgage of her real property which was
executed in the form and manner in which the mortgage in
question was executed. The real question involved is fully
discussed in Mechem on Agency, volume 1, page 784, in
which the author says:
It is to be observed that the question here is not how but
how such an authority is to be executed. it is assumed
that the agent was authorized to bind his principal, but
the question is, has he done so.
That is the question here.
Upon that point, there is a full discussion in the following
sections, and numerous authorities are cited:

SEC. 1093. Deed by agent must purport to be made and


sealed in the name of the principal. It is a general rule
in the law of agency that in order to bind the principal by a
deed executed by an agent, the deed must upon its grace
purport to be made, signed and sealed in the name of the
principal. If, on the contrary, though the agent describes
name, the words of grant, covenant and the like, purport
upon the face of the instrument to be his, and the seal
purports to be his seal, the deed will bind the agent if any
one and not the principal.
SEC. 1101. Whose deed is a given deed. How question
determined. In determining whether a given deed is the
deed of the principal, regard may be had First, to the party
named as grantor. Is the deed stated to be made by the
principal or by some other person? Secondly, to the
granting clause. Is the principal or the agent the person
who purports to make the grant? Thirdly, to the
covenants, if any. Are these the covenants of the
principal? Fourthly, to the testimonium clause. Who is it
who is to set his name and seal in testimony of the grant?
Is it the principal or the agent? And Fifthly, to the
signature and seal. Whose signature and seal are these?
Are they those of the principal or of the agent?
If upon such an analysis the deed does not upon its face
purport to be the deed of the principal, made, signed,
sealed and delivered in his name and his deed, it cannot
take effect as such.
SEC. 1102. Not enough to make deed the principal's that
the agent is described as such. It is not enough merely
that not acted in the name of the principal. Nor is it
ordinarily sufficient that he describes himself in the deed
as acting by virtue of a power of attorney or otherwise, or
for or in behalf, or as attorney, of the principal, or as a
committee, or as trustee of a corporation, etc.; for these
expressions are usually butdescriptio personae, and if, in
fact, he has acted of action thereon accrue to and against
him personally and not to or against the principal, despite
these recital.
SEC. 1103. Not principal's deed where agent appears as
grantor and signer. Neither can the deed ordinarily be
deemed to be the deed of the principal where the agent is
the one who is named as the grantor or maker, and he is
also the one who signs and seals it. . . .
SEC. 1108. . . . But however clearly the body of the deed
may show an intent that it shall be the act of he principal,
yet unless its executed by his attorney for him, it is not his
deed, but the deed of the attorney or of no one. The most
usual and approved form of executing a deed by attorney
is by his writing the name of the principal and adding by A
B his attorney or by his attorney A B.'
That is good law. Applying it to the facts, under his power of
attorney, Juan M. Poizat may have had authority to borrow
money and mortgage the real property of his wife, but the
law specifies how and in what manner it must be done, and
the stubborn fact remains that, as to the transaction in
question, that power was never exercised. The mortgage in
question was executed by him and him only, and for such
reason, it is not binding upon the wife, and as to her, it is
null and void.

conjugal partnership for the payment or security of which


the husband has the power to mortgage or otherwise
encumber the property .
It is very probable that his particular question was not fully
presented to or considered by the lower court.
The mortgage as to the paraphernal property of the wife is
declared null and void ab initio, and as to her personally, the
decree is declared null and void, and as to her paraphernal
property, the sale is set aside and vacated, and held for
naught, leaving it free and clear from the mortgage, decree
and sale, and in the same condition as if the mortgage had
never been executed, with costs in favor of the appellant. So
ordered.

G.R. No. 143297

February 11, 2003

SPOUSES VIRGILIO and MICHELLE CASTRO, MOISES B.


MIAT and ALEXANDER V. MIAT, petitioners,
vs.
ROMEO V. MIAT, respondent.
DECISION
PUNO, J.:
This is a petition for review on certiorari of the decision
rendered by the Court of Appeals in CA-G.R. CV No. 43053,
entitled "Romeo V. Miat vs. Spouses Virgilio and Michelle
Castro, Moises B. Miat and Alexander V. Miat," dated
November 29, 1999.1
The evidence shows that the spouses Moises and Concordia
Miat bought two (2) parcels of land during their coverture.
The first is located at Wawa La Huerta, Airport Village,
Paraaque, Metro Manila2 and covered by TCT No. S33535.3 The second is located at Paco, Manila,4 and covered
by TCT No. 163863.5 Concordia died on April 30, 1978. They
had two (2) children: Romeo and Alexander.
While at Dubai, United Arab Emirates, Moises agreed that
the Paraaque and Paco properties would be given to Romeo
and Alexander.6 However, when Moises returned in 1984, he
renegotiated the agreement with Romeo and Alexander. He
wanted the Paraaque property for himself but would leave
the Paco property to his two (2) sons. They agreed.7
It appears that Moises and Concordia bought the Paco
property on installment basis on May 17, 1977. 8 However, it
was only on December 14, 1984 that Moises was able to pay
its balance.9 He secured the title over the property in his
name as a widower.10 According to Romeo, Moises violated
the agreement that their (Romeos and Alexanders) names
would be registered in the title once the balance was
paid.11 Upon demand, Moises gave the owners duplicate of
the Paco property title to Romeo.
Romeo and Alexander lived on the Paco property. They paid
its realty taxes and fire insurance premiums.12 In early
August 1985, Alexander and his first wife left the house for
personal reasons. In April 1988, Alexander agreed to sell to
Romeo his share in the Paco property for P42,750.00.13 He
received a partial payment ofP6,000.00 from
Romeo.14 Nonetheless, he never executed a deed of
assignment in favor of Romeo, as he "had lots of work to do
and had no time and x x x there [wa]s nothing to worry [as]
the title [wa]s in [Romeos] possession."15
In February 1988, Romeo learned from his godmother in his
wedding, Mrs. Rosalina Castro, mother of petitioner Virgilio
Castro, that she had given Moises P30,000.00 as
downpayment for the sale by Moises of the Paco property to
her son Virgilio.16

It follows that the whole decree against her and her


paraphernal property and the sale of that property to satisfy
the mortgage are null and void, and that any title she may
have had in or to her paraphernal property remains and is
now vested in the wife as fully and as absolutely as if the
mortgage had never been executed, the decree rendered or
the property sold. As to Don Juan M. Poizat, the decree is
valid and binding, and remains in full force and effect.

On December 1, 1988, Romeo was brought by petitioner


Virgilio Castro to the chambers of Judge Anunciacion of the
Metropolitan Trial Court of Manila where the status of the
Paco property was discussed.17 On December 16, 1988, he
received a letter from petitioner Castros lawyer asking for a
conference. Romeo was informed that the Paco property had
been sold to Castro by Moises by virtue of a deed of sale
dated December 5, 198818 for ninety-five thousand
(P95,000.00) pesos.19

It is an undisputed fact, which appears in the mortgage


itself, that the land in question was the paraphernal property
of the wife, but after the marriage the old buildings on the
property were torn down and a new building constructed
and, in the absence of evidence to the contrary, it must be
presumed that the new building is conjugal property of the
husband and wife. As such, it is subject of the debts of the

Ceferino Miat, brother of petitioner Moises,20 testified that


even before the death of Concordia 21 there was already an
agreement that the Paco property would go to Romeo and
Alexander.22 This was reiterated at the deathbed of
Concordia.23 When Moises returned to Manila for good, the
agreement was reiterated24 in front of the extended Miat
family members.25 Initially, Romeo and Alexander
orally26 divided the Paco property between
themselves.27 Later, however, Alexander sold his share to

Romeo.28 Alexander was given P6,000.00 as downpayment.


This was corroborated by Pedro Miranda and Virgilio Miat.
Miranda worked with Moises at the Bayview Hotel and the
Hotel Filipinas.29 His wife is the cousin of Romeo and
Alexander.30 Virgilio is the brother of Moises.
Moises confirmed that he and his wife Concordia bought the
Paco property on installment from the Fraval Realty, Inc.
There was still a balance of P12,000.00 on the lot at the time
of his wifes death.31 He paid P3,500.00 in
198132 and P8,500.00 in 1984.33 He registered the title in his
name. Romeo then borrowed the title as he was going to
mortgage it to his friend Lorenzo.34
Later, Moises ran into financial difficulties and he mortgaged
for P30,000.00 the Paco property to the parents of petitioner
Virgilio Castro.35 He informed Romeo and Alexander that he
would be forced to sell the Paco property if they would not
redeem the mortgage. He accompanied his children to the
Manila City Hall to discuss its sale with a judge and a lawyer.
Also present in the meeting were petitioner Virgilio Castro
and his parents. After the conference, he proceeded to sell
the property to the petitioners-spouses Castro.36
Alexander testified that after the sale, his father got onethird (1/3) of the proceeds while he received two-thirds (2/3).
Romeo did not get a single centavo but was given the right
to till their Nueva Ecija property.37 From his share of the
proceeds, Alexander intended to return to Romeo
the P6,000.00 given him earlier by the latter. He considered
the money to be a personal debt due Romeo, not Romeos
downpayment of his share in the Paco property. 38
The buyer of the property, petitioner Virgilio P. Castro,
testified that he informed Romeo that his father Moises was
selling the Paco property. Romeo replied: "Bahala siya." 39 The
second time he informed Romeo about the pending sale was
when he brought Romeo, Alexander and Moises to Judge
Anunciacion to "consult him [as to] who has [the] right over
the [Paco] property."40 He further declared that he "went to
the Metropolitan Trial Court because [he] wanted to be sure
whether [he] could buy the property."41 During the meeting,
he was told by Romeo that the Paco property was already
given to him (Romeo) by Moises. He admitted knowing that
the title to the Paco property was in the possession of
Romeo.42 However, he proceeded with the sale. Moises
assured him that he would be able to get the title from
Romeo.43
These events precipitated the case at bar. Romeo filed an
action to nullify the sale between Moises and the Castro
spouses; to compel Moises and Alexander to execute a deed
of conveyance or assignment of the Paco property to him
upon payment of the balance of its agreed price; and to
make them pay damages.44
After trial, the Regional Trial Court rendered its
decision,45 which in its dispositive portion states as follows:
"WHEREFORE, in view of the foregoing, the Court hereby
orders the following: 1) Defendant Alexander V. Miat to
execute a deed of sale of his share in the property upon
payment by plaintiff Romeo of the balance of the purchase
price in the sum of P36,750.00; 2) Plaintiff Romeo V. Miat to
recognize as valid the sale of defendant Moises share in the
house and lot located at No. 1495-C Fabie Estate, Paco,
Manila; 3) the dismissal of defendants counter-claim; and 4)
defendants to pay the costs of suit."
Both parties appealed to Court of Appeals. On November 29,
1999, the appellate Court modified the Decision as follows: 46
"WHEREFORE, the appealed decision is MODIFIED as follows:
(1) The deed of sale entered into between defendantsappellants Moises Miat and spouses Virgilio and Michelle
Castro is hereby NULLIFIED.
(2) Defendant-appellants Moises Miat and Alexander Miat
are ordered to execute a deed of conveyance over the
Paco property with TCT No. 16383 (sic) in favor of plaintiffappellant Romeo Miat, upon payment by Romeo Miat of
the balance of the purchase price in the sum
of P36,750.00.
(3) Defendants-appellants are ordered, jointly and
severally, to pay plaintiff-appellant attorneys fees in the
amount of P30,000.00 and to pay the costs of suit."
Reconsideration was denied on May 17, 2000.
Hence, this petition where the petitioners assign the
following errors:
"THE RESPONDENT COURT OF APPEALS GRAVELY ERRED
AND DID PETITIONERS AN INJUSTICE IN MODIFYING OR
REVERSING THE DECISION OF THE TRIAL COURT DATED
MARCH 17, 1993 WHICH ORDERED RESPONDENT ROMEO
MIAT TO RECOGNIZE AS VALID THE DEED OF SALE ENTERED
INTO BETWEEN PETITIONERS MOISES MIAT AND SPS.
VIRGILIO AND MICHELLE CASTRO PERTAINING TO

PETITIONER MOISES MIATS SHARE IN THE HOUSE AND LOT


LOCATED IN PACO, MANILA, WHEN IT DECLARED SAID DEED
OF SALE NULLIFIED.
THE RESPONDENT COURT OF APPEALS PATENTLY ERRED IN
AFFIRMING OR UPHOLDING THE TRIAL COURTS DECISION
ORDERING ALEXANDER MIAT AND INCLUDING MOISES MIAT
TO EXECUTE A DEED OF CONVEYANCE OVER THE PACO
PROPERTY WITH TCT NO. 16383 IN FAVOR OF ROMEO MIAT
UPON PAYMENT BY THE LATTER OF THE BALANCE OF THE
PURCHASE PRICE IN THE SUM OF P36,750.00.
THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN
FURTHER ORDERING PETITIONERS TO PAY RESPONDENT,
JOINTLY AND SEVERALLY, ATTORNEYS FEES IN THE AMOUNT
OF P30,000.00 AND AFFIRMING THE COURT A QUOS ORDER
FOR THE PETITIONERS TO PAY THE COST OF SUIT."47
The issues can be simplified thus:
1. Whether the Paco property is conjugal or capital;
2. Whether there was a valid oral partition covering the
said property; and
3. Whether the spouses Castro were buyers in good faith.
I
The petitioners contend that the Paco property is the capital
property of Moises. They allege that the spouses Moises and
Concordia purchased the property on installment basis in
1977 but stress that it was Moises who paid the balance of
twelve thousand (P12,000.00) pesos in 1984. At that time,
Concordia had long been dead. She died in 1978.
We disagree.
Since Moises and Concordia were married before the
effectivity of the Family Code, the provisions of the New Civil
Code apply.
Article 153(1) of the New Civil Code48 provides as follows:
"The following are conjugal partnership property:
(1) Those acquired by onerous title during the marriage at
the expense of the common fund, whether the acquisition be
for the partnership, or for only one of the spouses; x x x."
The records show that the Paco property was acquired by
onerous title during the marriage out of the common fund. It
is clearly conjugal property.
Petitioners also overlook Article 160 of the New Civil Code. It
provides that "all property of the marriage is presumed to
belong to the conjugal partnership, unless it be proved that
it pertains exclusively to the husband or to the wife." This
article does not require proof that the property was acquired
with funds of the partnership. The presumption applies even
when the manner in which the property was acquired does
not appear.491a\^/phi1.net
Petitioners reliance on Lorenzo vs. Nicolas50 is misplaced.
That case involved two (2) parcels of land that Magdalena
Clemente purchased on installment and started paying for
when she was not yet married to Manuel Lorenzo. When she
married Manuel Lorenzo she continued to pay the
installments in her own name. Upon completion of payment,
the deed of final conveyance was executed in her sole favor
and the land was registered in the exclusive name of
Magdalena Clemente. The Court ruled that the two (2)
parcels of land were the paraphernal properties of
Magdalena Clemente, thus:
"x x x the fact that all receipts for installments paid even
during the lifetime of the late husband Manuel Lorenzo were
issued in the name of Magdalena Clemente and that the
deed of sale or conveyance of parcel no. 6 was made in her
name in spite of the fact that Manuel Lorenzo was still alive
shows that the two parcels of land belonged to Magdalena
Clemente."51 (emphasis supplied)
In the case at bar, Moises and Concordia bought the Paco
property during their marriage Moises did not bring it into
their marriage, hence it has to be considered as conjugal.
Likewise, Jovellanos vs. Court of Appeals52 cited by the
petitioners is inapropos. In said case, Daniel Jovellanos, while
he was still married to his first wife, Leonor Dizon, entered
into a "contract of lease and conditional sale" with
Philamlife. He continued paying the rental after the death of
his first wife and during the subsistence of his marriage with
his second wife, Anette Jovellanos. He completed the
payment during the existence of his second marriage. The
Court ruled that the property belonged to the conjugal
partnership with the second wife as Daniel Jovellanos
"acquired ownership thereof only upon full payment of the
said amount hence, although he had been in possession of
the premises since September 2, 1955, it was only on
January 8, 1975 that the Philamlife executed the deed of
absolute sale thereof in his favor. x x x Since as early as
1967, he was already married to Annette H. Jovellanos, this
property necessarily belonged to his conjugal partnership

with his second wife."53 In the case at bar, Moises and


Concordia executed a Deed of Sale with Mortgage. The
contract is one of sale the title passed to them upon
delivery of the Paco property.54 In fine, title was gained
during the conjugal partnership.
II
The next issue is whether the oral partition between Moises
and his sons, Romeo and Alexander, involving the said
property is valid. In ruling in favor of its validity which we
affirm, the appellate court relied on a portion of Moises
letter to Romeo, which reads as follows:55
"KAYA PAG-USAPAN LANG NINYONG MABUTI ANG ANONG
BALAK AT GUSTO NINYONG PAGHATI SA BAHAY, AT YAN AY
PAGPAPASIYAHAN KO KONG (sic) MAKAKABUTI SA INYONG
DALAWA. AT WALA AKONG HIGIT NA PAPABURAN SA INYONG
DALAWA PAREHO KAYONG MAHAL SA AKIN, HINDI AKO
TULAD SA IBANG MAGULANG NA HINDI PAREHO ANG
PAGTINGIN SA MGA ANAK. ANG BAHAY56 AY PARA SA INYONG
DALAWA, LALO NA NGAYONG MAY ASAWA NA KAYONG
PAREHO. x x x" [All caps in the original]
Ceferino Miat, brother of Moises, testified that before
Concordia died, there was an agreement that the Paraaque
property would go to Moises while the Paco property would
go to Romeo and Alexander. This was reiterated at the
deathbed of Concordia. When Moises returned to Manila for
good, the agreement was affirmed in front of the extended
Miat family members. Initially, Romeo and Alexander orally
divided the Paco property between them. Later, Alexander
sold his share to Romeo.
This agreement was attested to by the extended Miat Family
members in a document marked as Exhibit "D," which reads
as follows:57
"Pebrero 18, 1989
SINUMPAANG SALAYSAY
SA MGA KINAUUKULAN,
Kami, na nakalagda sa ibaba, ay nanunumpa sa harapan ng
Punong Barangay, na si G. REYNALDO P. WONG:
Na kami ay mga saksi sa kasunduan nina G. MOISES B. MIAT,
asawa ng yumao na, na si Gng. CONCORDIA VALENZUELA
MIAT, at mga anak nitong sina G. ROMEO V. MIAT at G.
ALEXANDER V. MIAT:
Na ang kasunduan ay ang mga sumusunod:
1. Na ang pag-aaring lupa (132 sq. m.) ng mag-asawa
(MOISES at CONCORDIA) sa Airport Village sa Paraaque,
Metro Manila ay mapupunta kay G. MOISES B. MIAT;
2. Na ang pag-aaring lupa at bahay (70 sq. m.) ng magasawa ring nabanggit ay sa magkapatid na ROMEO at
ALEXANDER mapupunta at ito ay nasa address na 1495-C
FABIE, PACO, MANILA.
MGA SUMUMPA:58
(Sgd.)
1) Ceferino B. Miat
(kapatid ni Moises)

(Sgd.)
6) Lorenzo C. Valenzuela
(kapatid ni Concordia)

(Sgd.)
2) Avelina J. Miat
(asawa ni Ceferino)

(Sgd.)
7) Patricio C. Valenzuela
(kapatid ni Concordia)

(Sgd.)
4) Aurea Miat-Joson
(kapatid ni Moises)

(Sgd.)
9) Elsa P. Miranda

(Sgd.)
5) Jose A. Joson
(asawa ni Aurea)
(Sgd.)
REYNALDO P. WONG
Kapitan ng Barangay
Sta. Maria, Licab, N.E."(emphasis supplied)
The consideration for the grant to Romeo and Alexander of
the Paco property was best expressed by Moises himself in
his letter to Romeo, which reads as follows:
"Labis akong nagpapasalamat at nauunawaan ninyo ang
mga pagkakamali ko at mga kasalanan kong nagawa sa
inyong mag-iina, huwag kayong mag-alala at lahat nang
naipundar namin nang (sic) inyong nanay ay sa inyong
dalawang magkapatid mapupunta." 59
We also hold that the oral partition between Romeo and
Alexander is not covered by the Statute of Frauds. It is
enforceable for two reasons. Firstly, Alexander accepted the
six thousand (P6,000.00) pesos given by Romeo as

downpayment for the purchase of his share in the Paco


property. Secondly, Romeo and his witnesses, Ceferino Miat
and Pedro Miranda, who testified regarding the sale of
Alexanders share to Romeo, were intensely questioned by
petitioners counsel.601awphi1.nt
In the recent case of Pada-Kilario vs. Court of Appeals, we
held:61
"[N]o law requires partition among heirs to be in writing and
be registered in order to be valid. The requirement in Sec. 1,
Rule 74 of the Revised Rules of Court that a partition be put
in a public document and registered, has for its purpose the
protection of creditors and the heirs themselves against
tardy claims. The object of registration is to serve as
constructive notice to others. It follows then that the intrinsic
validity of partition not executed with the prescribed
formalities is not undermined when no creditors are
involved. Without creditors to take into consideration, it is
competent for the heirs of an estate to enter into an
agreement for distribution thereof in a manner and upon a
plan different from those provided by the rules from which,
in the first place, nothing can be inferred that a writing or
other formality is essential for the partition to be valid. The
partition of inherited property need not be embodied in a
public document so as to be effective as regards the heirs
that participated therein. The requirement of Article 1358 of
the Civil Code that acts which have for their object the
creation, transmission, modification or extinguishment of
real rights over immovable property, must appear in a public
instrument, is only for convenience, non-compliance with
which does not affect the validity or enforceability of the
acts of the parties as among themselves. And neither does
the Statute of Frauds under Article 1403 of the New Civil
Code apply because partition among heirs is not legally
deemed a conveyance of real property, considering that it
involves not a transfer of property from one to the other but
rather, a confirmation or ratification of title or right of
property that an heir is renouncing in favor of another heir
who accepts and receives the inheritance. x x x."
III
The appellate court also correctly held that the petitionersspouses Castro were not buyers in good faith. A purchaser in
good faith is one who buys property and pays a full and fair
price for it at the time of the purchase or before any notice
of some other persons claim on or interest in it. The rule is
settled that a buyer of real property, which is in the
possession of persons other than the seller, must be wary
and should investigate the rights of those in
possession.1a\^/phi1.net Otherwise, without such inquiry,
the buyer can hardly be regarded as buyer in good faith.62
This finding of the appellate court that the Castro spouses
were not buyers in good faith is supported by evidence.
Petitioner Virgilio Castro admitted in his testimony that
Romeo told him that Moises had given the Paco property to
them. In fact, they consulted Judge Anunciacion on who had
the right to the property Moises or Romeo. As well pointed
out by the appellate court:
"In the case at bench, the said spouses have actual
knowledge of the adverse claim of plaintiff-appellant. The
most protuberant index that they are not buyers in good
faith is that before the sale, Virgilio Castro talked with
Romeo Miat on the supposed sale. Virgilio testified that
together with Romeo, Alexander and Moses Miat, they went
to Judge Anunciacion of Manila in order to find out if Romeo
has a right over the property. Romeo told Virgilio in that
meeting that Romeo has a right over the Paco property by
virtue of an oral partition and assignment. Virgilio even
admitted that he knew Romeo was in possession of the title
and Romeo then insisted that he is the owner of the
property.
xxxxxxxxx
"Virgilio Castro is further aware that plaintiff is in possession
of the property, they being neighbors. A purchaser who was
fully aware of another persons possession of the lot he
purchased cannot successfully pretend to be an innocent
purchaser for value."63
It is abundantly clear that the petitioners-spouses Castro did
not buy the Paco property in good faith. They have no right
to the property.
WHEREFORE, the decision of the appellate court in CA-G.R.
CV No. 43053 is affirmed. Costs against petitioners.
SO ORDERED.

G.R. No. L-55322 February 16, 1989

MOISES JOCSON, petitioner,


vs.
HON. COURT OF APPEALS, AGUSTINA JOCSONVASQUEZ, ERNESTO VASQUEZ, respondents.
Dolorfino and Dominguez Law Officers for petitioner.
Gabriel G. Mascardo for private respondents.
MEDIALDEA, J.:
This is a petition for review on certiorari under Rule 45 of the
Rules of Court of the decision of the Court of Appeals in CAG.R. No. 63474, promulgated on April 30, 1980, entitled
"MOISES JOCSON, plaintiff-appellee, versus AGUSTINA
JOCSON-VASQUEZ and ERNESTO VASQUEZ, defendantappellants," upholding the validity of three (3) documents
questioned by Moises Jocson, in total reversal of the decision
of the then Court of First Instance of Cavite, Branch I, which
declared them as null and void; and of its resolution, dated
September 30, 1980, denying therein appellee's motion for
reconsideration.
Petitioner Moises Jocson and respondent Agustina JocsonVasquez are the only surviving offsprings of the spouses
Emilio Jocson and Alejandra Poblete, while respondent
Ernesto Vasquez is the husband of Agustina. Alejandra
Poblete predeceased her husband without her intestate
estate being settled. Subsequently, Emilio Jocson also died
intestate on April 1, 1972.
As adverted to above, the present controversy concerns the
validity of three (3) documents executed by Emilio Jocson
during his lifetime. These documents purportedly conveyed,
by sale, to Agustina Jocson-Vasquez what apparently covers
almost all of his properties, including his one-third (1/3)
share in the estate of his wife. Petitioner Moises Jocson
assails these documents and prays that they be declared
null and void and the properties subject matter therein be
partitioned between him and Agustina as the only heirs of
their deceased parents.
The documents, which were presented as evidence not by
Moises Jocson, as the party assailing its validity, but rather
by herein respondents, are the following:
1) "Kasulatan ng Bilihan ng Lupa," marked as Exhibit 3
(pp. 12-13, Records) for the defendant in the court a quo,
dated July 27, 1968. By this document Emilio Jocson sold
to Agustina Jocson-Vasquez six (6) parcels of land, all
located at Naic, Cavite, for the sum of ten thousand
P10,000.00 pesos. On the same document Emilio Jocson
acknowledged receipt of the purchase price, thus:
Na ngayon, alang-alang sa halagang SAMPUNG LIBONG
PISO (P10,000) salaping Pilipino na aking tinanggap ng
buong kasiyahan loob at ang pagkakatanggap ay aking
hayagang inaamin sa pamamagitan ng kasulatang ito, sa
aking anak na si Agustina Jocson, na may sapat na gulang,
mamamayang Pilipino, asawa ni Ernesto Vasquez, at
naninirahan sa Poblacion, Naic, Cavite, ay aking ipinagbile
ng lubusan at kagyat at walang ano mang pasubali ang
nabanggit na anim na pirasong lupa na nasa unang dahon
ng dokumentong ito, sa nabanggit na Agustina Jocson, at
sa kaniyang tagapagmana o makakahalili at gayon
din nais kong banggitin na kahit na may kamurahan ang
ginawa kong pagbibile ay dahilan sa ang nakabile ay
aking anak na sa akin at mapaglingkod, madamayin at
ma-alalahanin, na tulad din ng isa ko pang anak na
lalaki. Ang kuartang tinanggap ko na P10,000.00, ay
gagamitin ko sa aking katandaan at mga huling araw at sa
aking mga ibang mahahalagang pangangailangan.
[Emphasis supplied]
Na nais ko ring banggitin na ang ginawa kong ito ay hindi
labag sa ano mang batas o kautusan, sapagkat ang aking
pinagbile ay akin at nasa aking pangalan. Ang mga lupang
nasa pangalan ng aking nasirang asawa ay hindi ko
ginagalaw ni pinakikialaman at iyon ay dapat na hatiin ng
dalawa kong anak alinsunod sa umiiral na batas (p. 13,
Records.)

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


marked as Exhibit 4 (p. 14, Records). On the face of this
document, Emilio Jocson purportedly sold to Agustina
Jocson-Vasquez, for the sum of FIVE THOUSAND
(P5,000.00) PESOS, two rice mills and a camarin (camalig)
located at Naic, Cavite. As in the first document, Moises
Jocson acknowledged receipt of the purchase price:
'Na alang-alang sa halagang LIMANG LIBONG PISO
(P5,000.00) salaping Pilipino na aking tinanggap ng buong
kasiyahan loob sa aking anak na Agustina Jocson .... Na
ang halagang ibinayad sa akin ay may kamurahan ng
kaunti ngunit dahil sa malaking pagtingin ko sa kaniya ...
kaya at pinagbile ko sa kaniya ang mga nabanggit na
pagaari kahit na hindi malaking halaga ... (p. 14, Records).
3) Lastly, the "Deed of Extrajudicial Partition and
Adjudication with Sale, "dated March 9, 1969, marked as
Exhibit 2 (p. 10-11, Records), whereby Emilio Jocson and
Agustina Jocson-Vasquez, without the participation and
intervention of Moises Jocson, extrajudicially partitioned
the unsettled estate of Alejandra Poblete, dividing the
same into three parts, one-third (1/3) each for the heirs of
Alejandra Poblete, namely: Emilio Jocson, Agustina JocsonVasquez and Moises Jocson. By the same instrument,
Emilio sold his one- third (1/3) share to Agustin for the
sum of EIGHT THOUSAND (P8,000.00) PESOS. As in the
preceding documents, Emilio Jocson acknowledged receipt
of the purchase price:
Now for and in consideration of the sum of only eight
thousand (P8,000.00) pesos, which I, the herein Emilio
Jocson had received from my daughter Agustina Jocson, do
hereby sell, cede, convey and transfer, unto the said
Agustina Jocson, her heirs and assigns, administrators and
successors in interests, in the nature of absolute and
irrevocable sale, all my rights, interest, shares and
participation, which is equivalent to one third (1/3) share
in the properties herein mentioned and described the one
third being adjudicated unto Agustina Jocson and the other
third (1/3) portion being the share of Moises Jocson. (p. 11,
Records).
These documents were executed before a notary public.
Exhibits 3 and 4 were registered with the Office of the
Register of Deeds of Cavite on July 29, 1968 and the transfer
certificates of title covering the properties therein in the
name of Emilio Jocson, married to Alejandra Poblete," were
cancelled and new certificates of title were issued in the
name of Agustina Jocson-Vasquez. Exhibit 2 was not
registered with the Office of the Register of Deeds.
Herein petitioner filed his original complaint (Record on
Appeal, p. 27, Rollo) on June 20,1973 with the then Court of
First Instance of Naic, Cavite (docketed as Civil Case No. TM531), and which was twice amended. In his Second
Amended Complaint (pp. 47-58, Record on Appeal), herein
petitioner assailed the above documents, as
aforementioned, for being null and void.
It is necessary to partly quote the allegation of petitioner in
his complaint for the reason that the nature of his causes of
action is at issue, thus:
8. [With regard the first document, that] the defendants,
through fraud, deceit, undue pressure and influence and
other illegal machinations, were able to induce, led, and
procured their father ... to sign [the] contract of sale ...,
for the simulated price of P10,000.00, which is a
consideration that is shocking to the conscience of
ordinary man and despite the fact that said defendants
have no work or livelihood of their own ...; that the sale is
null and void, also, because it is fictitious, simulated and
fabricated contract x x x (pp. 52-53, Record on Appeal).
[Emphasis supplied]
xxx xxx xxx
12. [With regards the second and third document, that
they] are null and void because the consent of the father,
Emilio Jocson, was obtained with fraud, deceit, undue
pressure, misrepresentation and unlawful machinations

and trickeries committed by the defendant on him; and


that the said contracts are simulated, fabricated and
fictitious, having been made deliberately to exclude the
plaintiff from participating and with the dishonest and
selfish motive on the part of the defendants to defraud
him of his legitimate share on said properties [subject
matter thereof]; and that without any other business or
employment or any other source of income, defendants
who were just employed in the management and
administration of the business of their parents, would not
have the sufficient and ample means to purchase the
said properties except by getting the earnings of the
business or by simulated consideration ... (pp. 54-55,
Record on Appeal). [Emphasis supplied]
Petitioner explained that there could be no real sale between
a father and daughter who are living under the same roof,
especially so when the father has no need of money as the
properties supposedly sold were all income-producing.
Further, petitioner claimed that the properties mentioned in
Exhibits 3 and 4 are the unliquidated conjugal properties of
Emilio Jocson and Alejandra Poblete which the former,
therefore, cannot validly sell (pp. 53, 57, Record on Appeal).
As far as Exhibit 2 is concerned, petitioner questions not the
extrajudicial partition but only the sale by his father to
Agustina of the former's 1/3 share (p. 13, Rollo).
The trial court sustained the foregoing contentions of
petitioner (pp. 59-81, Record on Appeal). It declared that the
considerations mentioned in the documents were merely
simulated and fictitious because: 1) there was no showing
that Agustina Jocson-Vasquez paid for the properties; 2) the
prices were grossly inadequate which is tantamount to lack
of consideration at all; and 3) the improbability of the sale
between Emilio Jocson and Agustina Jocson-Vasquez, taking
into consideration the circumstances obtaining between the
parties; and that the real intention of the parties were
donations designed to exclude Moises Jocson from
participating in the estate of his parents. It further declared
the properties mentioned in Exhibits 3 and 4 as conjugal
properties of Emilio Jocson and Alejandra Poblete, because
they were registered in the name of "Emilio Jocson, married
to Alejandra Poblete" and ordered that the properties subject
matter of all the documents be registered in the name of
herein petitioners and private respondents.
On appeal, the Court of Appeals in CA-G.R. No. 63474-R
rendered a decision (pp. 29-42, Rollo) and reversed that of
the trial court's and ruled that:
1. That insofar as Exhibits 3 and 4 are concerned the
appellee's complaint for annulment, which is indisputably
based on fraud, and undue influence, is now barred by
prescription, pursuant to the settled rule that an action for
annulment of a contract based on fraud must be filed
within four (4) years, from the discovery of the fraud, ...
which in legal contemplation is deemed to be the date of
the registration of said document with the Register of
Deeds ... and the records admittedly show that both
Exhibits 3 and 4, were all registered on July 29, 1968,
while on the other hand, the appellee's complaint was
filed on June 20, 1973, clearly beyond the aforesaid fouryear prescriptive period provided by law;

In this petition for review, Moises Jocson raised the following


assignments of errors:
1. HAS THE RESPONDENT COURT OF APPEALS ERRED IN
CONCLUDING THAT THE SUIT FOR THE ANNULMENT OF
CONTRACTS FILED BY PETITIONERS WITH THE TRIAL
COURT IS "BASED ON FRAUD" AND NOT ON ITS
INEXISTENCE AND NULLITY BECAUSE OF IT'S BEING
SIMULATED OR FICTITIOUS OR WHOSE CAUSE IS
CONTRARY TO LAW, MORALS AND GOOD CUSTOMS?
II. HAS THE RESPONDENT COURT OF APPEALS ERRED IN
CONCLUDING THAT THE COMPLAINT FILED BY
PETITIONER IN THE TRIAL COURT IS BARRED BY
PRESCRIPTION?
III. HAS THE RESPONDENT COURT OF APPEALS ERRED IN
NOT DECLARING AS INEXISTENT AND NULL AND VOID
THE CONTRACTS IN QUESTION AND IN REVERSING THE
DECLARING DECISION OF THE TRIAL COURT? (p. 2,
Rollo)
I.
The first and second assignments of errors are related and
shall be jointly discussed.
According to the Court of Appeals, herein petitioner's causes
of action were based on fraud. Under Article 1330 of the Civil
Code, a contract tainted by vitiated consent, as when
consent was obtained through fraud, is voidable; and the
action for annulment must be brought within four years from
the time of the discovery of the fraud (Article 1391, par. 4,
Civil Code), otherwise the contract may no longer be
contested. Under present jurisprudence, discovery of fraud is
deemed to have taken place at the time the convenant was
registered with the Register of Deeds (Gerona vs. De
Guzman, No. L-19060, May 29,1964, 11 SCRA 153). Since
Exhibits 3 and 4 were registered on July 29, 1968 but Moises
Jocson filed his complaint only on June 20, 1973, the Court of
Appeals ruled that insofar as these documents were
concerned, petitioner's "annulment suit" had prescribed.
If fraud were the only ground relied upon by Moises Jocson in
assailing the questioned documents, We would have
sustained the above pronouncement. But it is not so. As
pointed out by petitioner, he further assailed the deeds of
conveyance on the ground that they were without
consideration since the amounts appearing thereon as paid
were in fact merely simulated.
According to Article 1352 of the Civil Code, contracts without
cause produce no effect whatsoever. A contract of sale with
a simulated price is void (Article 1471; also Article 1409
[3]]), and an action for the declaration of its nullity does not
prescribe (Article 1410, Civil Code; See also, Castillo v.
Galvan, No. L-27841, October 20, l978, 85 SCRA 526).
Moises Jocsons saction, therefore, being for the judicial
declaration of nullity of Exhibits 3 and 4 on the ground of
simulated price, is imprescriptible.
II.

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


decisively not simulated or fictitious contracts, since
Emilio Jocson actually and really intended them to be
effective and binding against him, as to divest him of the
full dominion and ownership over the properties subject of
said assailed contracts, as in fact all his titles over the
same were all cancelled and new ones issued to appellant
Agustina Jocson-Vasquez ...;
3. That in regard to Exhibit 2, the same is valid and
subsisting, and the partition with sale therein made by
and between Emilio Jocson and Agustina Jocson-Vasquez,
affecting the 2/3 portion of the subject properties
described therein have all been made in accordance with
Article 996 of the New Civil Code on intestate succession,
and the appellee's (herein petitioner) remaining 1/3 has
not been prejudiced (pp. 41-42, Rollo).

For petitioner, however, the above discussion may be purely


academic. The burden of proof in showing that contracts lack
consideration rests on he who alleged it. The degree of proof
becomes more stringent where the documents themselves
show that the vendor acknowledged receipt of the price, and
more so where the documents were notarized, as in the case
at bar. Upon consideration of the records of this case, We are
of the opinion that petitioner has not sufficiently proven that
the questioned documents are without consideration.
Firstly, Moises Jocson's claim that Agustina Jocson-Vasquez
had no other source of income other than what she derives
from helping in the management of the family business
(ricefields and ricemills), and which was insufficient to pay
for the purchase price, was contradicted by his own witness,
Isaac Bagnas, who testified that Agustina and her husband
were engaged in the buy and sell of palay and rice (p. 10,
t.s.n., January 14, 1975). Amazingly, petitioner himself and

his wife testified that they did not know whether or not
Agustina was involved in some other business (p. 40, t.s.n.,
July 30, 1974; p. 36, t.s.n., May 24, 1974).
On the other hand, Agustina testified that she was engaged
in the business of buying and selling palay and rice even
before her marriage to Ernesto Vasquez sometime in 1948
and continued doing so thereafter (p. 4, t.s.n., March 15,
1976). Considering the foregoing and the presumption that a
contract is with a consideration (Article 1354, Civil Code), it
is clear that petitioner miserably failed to prove his
allegation.
Secondly, neither may the contract be declared void
because of alleged inadequacy of price. To begin with, there
was no showing that the prices were grossly inadequate. In
fact, the total purchase price paid by Agustina JocsonVasquez is above the total assessed value of the properties
alleged by petitioner. In his Second Amended Complaint,
petitioner alleged that the total assessed value of the
properties mentioned in Exhibit 3 was P8,920; Exhibit 4,
P3,500; and Exhibit 2, P 24,840, while the purchase price
paid was P10,000, P5,000, and P8,000, respectively, the
latter for the 1/3 share of Emilio Jocson from the paraphernal
properties of his wife, Alejandra Poblete. And any difference
between the market value and the purchase price, which as
admitted by Emilio Jocson was only slight, may not be so
shocking considering that the sales were effected by a father
to her daughter in which case filial love must be taken into
consideration (Alsua-Betts vs. Court of Appeals, No. L-4643031, April 30, 1979, 92 SCRA 332).
Further, gross inadequacy of price alone does not affect a
contract of sale, except that it may indicate a defect in the
consent, or that the parties really intended a donation or
some other act or contract (Article 1470, Civil Code) and
there is nothing in the records at all to indicate any defect in
Emilio Jocson's consent.
Thirdly, any discussion as to the improbability of a sale
between a father and his daughter is purely speculative
which has no relevance to a contract where all the essential
requisites of consent, object and cause are clearly present.
There is another ground relied upon by petitioner in assailing
Exhibits 3 and 4, that the properties subject matter therein
are conjugal properties of Emilio Jocson and Alejandra
Poblete. It is the position of petitioner that since the
properties sold to Agustina Jocson-Vasquez under Exhibit 3
were registered in the name of "Emilio Jocson, married to
Alejandra Poblete," the certificates of title he presented as
evidence (Exhibits "E', to "J', pp. 4-9, Records) were enough
proof to show that the properties covered therein were
acquired during the marriage of their parents, and,
therefore, under Article 160 of the Civil Code, presumed to
be conjugal properties.
Article 160 of the Civil Code provides that:
All property of the marriage is presumed to
belong to the conjugal partnership, unless
it be proved that it pertains exclusively to
the husband or to the wife.
In Cobb-Perez vs. Hon. Gregorio Lantin, No. L-22320, May 22,
1968, 23 SCRA 637, 644, We held that:
Anent their claim that the shares in question are conjugal
assets, the spouses Perez adduced not a modicum of
evidence, although they repeatedly invoked article 160 of
the New Civil Code which provides that ... . As interpreted
by this Court, the party who invokes this presumption
must first prove that the property in controversy was
acquired during the marriage. In other words, proof of
acquisition during the coverture is a condition sine
qua non for the operation of the presumption in favor of
conjugal ownership. Thus in Camia de Reyes vs. Reyes de
Ilano [62 Phil. 629, 639], it was held that "according to law
and jurisprudence, it is sufficient to prove that the
Property was acquired during the marriage in order that
the same may be deemed conjugal property." In the
recent case ofMaramba vs. Lozano, et. al. [L-21533, June

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


Makalintal, reiterated that "the presumption under Article
160 of the Civil Code refers to property acquired during
the marriage," and then concluded that since "there is no
showing as to when the property in question was
acquired...the fact that the title is in the wife's name alone
is determinative." Similarly, in the case at bar, since there
is no evidence as to when the shares of stock were
acquired, the fact that they are registered in the name of
the husband alone is an indication that the shares belong
exclusively to said spouse.'
This pronouncement was reiterated in the case of Ponce de
Leon vs. Rehabilitation Finance Corporation, No. L-24571,
December 18, 1970, 36 SCRA 289, and later in Torela vs.
Torela, No. 1,27843, October 11, 1979, 93 SCRA 391.
It is thus clear that before Moises Jocson may validly invoke
the presumption under Article 160 he must first present
proof that the disputed properties were acquired during the
marriage of Emilio Jocson and Alejandra Poblete. The
certificates of title, however, upon which petitioner rests his
claim is insufficient. The fact that the properties were
registered in the name of "Emilio Jocson, married to
Alejandra Poblete" is no proof that the properties were
acquired during the spouses' coverture. Acquisition of title
and registration thereof are two different acts. It is well
settled that registration does not confer title but merely
confirms one already existing (See Torela vs. Torela, supra).
It may be that the properties under dispute were acquired by
Emilio Jocson when he was still a bachelor but were
registered only after his marriage to Alejandra Poblete,
which explains why he was described in the certificates of
title as married to the latter.
Contrary to petitioner's position, the certificates of title
show, on their face, that the properties were exclusively
Emilio Jocson's, the registered owner. This is so because the
words "married to' preceding "Alejandra Poblete' are merely
descriptive of the civil status of Emilio Jocson Litam v.
Rivera, 100 Phil. 354; Stuart v. Yatco, No. L-16467, April 27,
1962, 4 SCRA 1143; Magallon v. Montejo, G.R. No. L-73733,
December 16, 1986, 146 SCRA 282). In other words, the
import from the certificates of title is that Emilio Jocson is
the owner of the properties, the same having been
registered in his name alone, and that he is married to
Alejandra Poblete.
We are not unmindful that in numerous cases We
consistently held that registration of the property in the
name of only one spouse does not negate the possibility of it
being conjugal (See Bucoy vs. Paulino, No. L-25775, April 26,
1968, 23 SCRA 248). But this ruling is not inconsistent with
the above pronouncement for in those cases there was proof
that the properties, though registered in the name of only
one spouse, were indeed conjugal properties, or that they
have been acquired during the marriage of the spouses, and
therefore, presumed conjugal, without the adverse party
having presented proof to rebut the presumption (See
Mendoza vs- Reyes, No. L-31618, August 17, 1983, 124 SCRA
154).
In the instant case, had petitioner, Moises Jocson, presented
sufficient proof to show that the disputed properties were
acquired during his parents' coverture. We would have ruled
that the properties, though registered in the name of Emilio
Jocson alone, are conjugal properties in view of the
presumption under Article 160. There being no such proof,
the condition sine qua non for the application of the
presumption does not exist. Necessarily, We rule that the
properties under Exhibit 3 are the exclusive properties of
Emilio Jocson.
There being no showing also that the camarin and the two
ricemills, which are the subject of Exhibit 4, were conjugal
properties of the spouses Emilio Jocson and Alejandra
Poblete, they should be considered, likewise, as the
exclusive properties of Emilio Jocson, the burden of proof
being on petitioner.
ACCORDINGLY, the petition is DISMISSED and the decision of
the Court of Appeals is AFFIRMED.

SO ORDERED.

RESPONDENT COURT ERRED IN APPLYING ARTICLES 160


AND 158, UNDER TITLE VI OF THE (NEW) CIVIL CODE
BECAUSE SAID TITLE, TOGETHER WITH THE OTHERS,
HAVE (SIC) ALREADY BEEN REPEALED BY ARTICLE 253
OF THE FAMILY CODE.

G.R. No. 102330 November 25, 1998


SECOND ASSIGNMENT OF ERROR
TERESITA C. FRANCISCO, petitioner,
vs.
HON. COURT OF APPEALS; and CONCHITA
EVANGELISTA and Her Husband SIMEON
EVANGELISTA; ARACELI F. MARILLA and Her Husband
FREDDY MARILLA; ANTONIO V. FRANCISCO; and
EUSEBIO FRANCISCO, respondents.

QUISUMBING, J.:
This petition for review on certiorari seeks to reverse
respondent appellate court's decision 1 promulgated on
October 7, 1991, affirming in toto the judgment of the
Regional Trial Court which ruled, 2 thus:
WHEREFORE, premises considered, this Court renders
judgment in favor of the defendants and against the
plaintiff, as follows:
1) Ordering the dismissal of the Complaint with costs
against the plaintiff;
2) Declaring the defendant Eusebio Francisco the
administrator of the properties described in paragraph
eight (8) of the Complaint; and
3) Sentencing the plaintiff to pay the defendants the sum
of P10,000.00 as and for attorney's fees.
SO ORDERED.
Petitioner is the legal wife of private respondent Eusebio
Francisco (Eusebio) by his second marriage. Private
respondents Conchita Evangelista, Araceli F. Marilla and
Antonio Francisco are children of Eusebio by his first
marriage.
Petitioner alleges that since their marriage on February 10,
1962, she and Eusebio have acquired the following: (1) a
sari-sari store, a residential house and lot, and an apartment
house, all situated at Col. S. Cruz St., Barangay Balite,
Rodriguez (formerly Montalban), Rizal, and; (2) a house and
lot at Barrio San Isidro, Rodriguez, Rizal. Petitioner further
avers that these properties were administered by Eusebio
until he was invalidated on account of tuberculosis, heart
disease and cancer, thereby, rendering him unfit to
administer them. Petitioner also claims that private
respondents succeeded in convincing their father to sign a
general power of attorney which authorized Conchita
Evangelista to administer the house and lot together with
the apartments situated in Rodriguez, Rizal.
On August 31, 1988, petitioner filed a suit for damages and
for annulment of said general power of attorney, and
thereby enjoining its enforcement. Petitioner also sought to
be declared as the administratrix of the properties in
dispute. In due course, the trial court rendered judgment in
favor of private respondents. It held that the petitioner failed
to adduce proof that said properties were acquired during
the existence of the second conjugal partnership, or that
they pertained exclusively to the petitioner. Hence, the court
ruled that those properties belong exclusively to Eusebio,
and that he has the capacity to administer them.
On appeal, the Court of Appeals affirmed in toto the decision
of the trial court. Hence, this petition.
Petitioner raised the following errors allegedly committed by
the appellate court:
FIRST ASSIGNMENT OF ERROR

RESPONDENT COURT FURTHER ERRED IN NOT APPLYING


ARTICLE 124 OF THE FAMILY CODE. 3
But in her reply, petitioner posed the sole issue "whether or
not Article 116 of the Family Code applies to this case
because Article 253 of the same Code [which] expressly
repeals Arts. 158 and 160 of the Civil Code" 4
To our mind, the crucial issue in this petition is whether or
not the appellate court committed reversible error in
affirming the trial court's ruling that the properties, subject
matter of controversy, are not conjugal but the capital
properties of Eusebio exclusively.
Indeed, Articles 158 5 and 160 6 of the New Civil Code have
been repealed by the Family Code of the Philippines which
took effect on August 3, 1988. The aforecited articles fall
under Title VI, Book I of the New Civil Code which was
expressly repealed by Article 254 7 (not Article 253 as
alleged by petitioner in her petition and reply) of the Family
Code. Nonetheless, we cannot invoke the new law in this
case without impairing prior vested rights pursuant to Article
256 8 in relation to Article 105 9 (second paragraph) of the
Family Code. Accordingly, the repeal of Articles 158 and 160
of the New Civil Code does not operate to prejudice or
otherwise affect rights which have become vested or
accrued while the said provisions were in force. 10 Hence, the
rights accrued and vested while the cited articles were in
effect survive their repeal. 11 We shall therefore resolve the
issue of the nature of the contested properties based on the
provisions of the New Civil Code.
Petitioner contends that the subject properties are conjugal,
thus, she should administer these on account of the
incapacity of her husband. On the other hand, private
respondents maintain that the assets in controversy claimed
by petitioner as "conjugal" are capital properties of Eusebio
exclusively as these were acquired by the latter either
through inheritance or through his industry prior to his
second marriage. Moreover, they stress that Eusebio is not
incapacitated contrary to petitioner's allegation.
We find petitioner's contention lacks merit, as hereafter
elucidated.
Art. 160 of the New Civil Code provides that "all property of
the marriage is presumed to belong to the conjugal
partnership, unless it be proved that it pertains exclusively
to the husband or to the wife". However, the party who
invokes this presumption must first prove that the property
in controversy was acquired during the marriage. 12Proof of
acquisition during the coverture is a condition sine qua
non for the operation of the presumption in favor of the
conjugal partnership. 13 The party who asserts this
presumption must first prove said time element. Needless to
say, the presumption refers only to the property acquired
during the marriage and does not operate when there is no
showing as to when property alleged to be conjugal was
acquired. 14 Moreover, this presumption in favor of
conjugality is rebuttable, but only with strong, clear and
convincing evidence; there must be a strict proof of
exclusive ownership of one of the spouses.15
In this case, petitioner failed to adduce ample evidence to
show that the properties which she claimed to be conjugal
were acquired during her marriage with Eusebio.
With respect to the land at Col. Cruz St., Balite, Rodriguez,
Rizal, petitioner failed to refute the testimony of Eusebio
that he inherited the same from his parents. Interestingly,
petitioner even admitted that Eusebio brought into their
marriage the said land, albeit in the concept of a possessor
only as it was not yet registered in his name.

Whether Eusebio succeeded to the property prior or


subsequent to his second marriage is inconsequential. The
property should be regarded as his own exclusively, as a
matter of law, pursuant to Article 148 16 of the New Civil
Code.
Essentially, property already owned by a spouse prior to the
marriage, and brought to the marriage, is considered his or
her separate property. 17 Acquisitions by lucrative title refers
to properties acquired gratuitously and include those
acquired by either spouse during the marriage by
inheritance, devise, legacy, or donation. 18 Hence, even if it
be assumed that Eusebio's acquisition by succession of the
land took place during his second marriage, the land would
still be his "exclusive property" because it was acquired by
him, "during the marriage, by lucrative title." 19
As regards the house, apartment and sari-sari store, private
respondents aver that these properties were either
constructed or established by their father during his first
marriage. On the other hand, petitioner insists that the said
assets belong to conjugal partnership. In support of her
claim, petitioner relied on the building permits for the house
and the apartment, with her as the applicant although in the
name of Eusebio. She also invoked the business license for
the sari-sari store issued in her name alone.
It must be emphasized that the aforementioned documents
in no way prove that the improvements were acquired
during the second marriage. And the fact that one is the
applicant or licensee is not determinative of the issue as to
whether or not the property is conjugal or not. As the
appellate court aptly noted:
. . . . And the mere fact that plaintiff-appellant [petitioner
herein] is the licensee of the sari-sari store (Exhibit "F-3";
Exhibit "G", pp. 44-47, Record) or is the supposed
applicant for a building permit does not establish that
these improvements were acquired during her marriage
with Eusebio Francisco, especially so when her exhibits
("D-1", "E", "E-I", "T", "T-1", "T-2", "U", "U-l" and "U-2"; pp.
38-40; 285-290, Record; TSN, January 17, 1989, page 6-7)
are diametrically opposed to her pretense as they all
described Eusebio Francisco as the owner of the structures
(Article 1431, New Civil Code;Section 4. Rule 129, Revised
Rules on Evidence).
Neither is it plausible to argue that the sari-sari store
constructed on the land of Eusebio Francisco has thereby
become conjugal for want of evidence to sustain the
proposition that it was constructed at the expense of their
partnership (second paragraph, Article 158, New Civil
Code). Normally, this absence of evidence on the source of
funding will call for the application of the presumption
under Article 160 of the New Civil Code that the store is
really conjugal but it cannot be so in this particular case
again, by reason of the dearth in proof that it was erected
during the alleged second marriage (5 Sanchez Roman
840-841; 9 Manresa; cited in Civil Code of the Philippines
by Tolentino, Volume 1, 1983 Edition, page
421). 20
Regarding the property at San Isidro, Rodriguez, Rizal,
private respondents assert that their father purchased it
during the lifetime of their mother. In contrast, petitioner
claims ownership over said property in as much as the title
thereto is registered in the name of "Eusebio Francisco,
married to Teresita Francisco."
It must be stressed that the certificate of title upon which
petitioner anchors her claim is inadequate. The fact that the
land was registered in the name of "Eusebio Francisco,
married to Teresita Francisco", is no proof that the property
was acquired during the spouses coverture. Acquisition of
title and registration thereof are two different acts. 21 It is
well settled that registration does not confer title but merely
confirms one already existing. 22 The phrase "married to"
preceding "Teresita Francisco" is merely descriptive of the
civil status of Eusebio Francisco. 23
In the light of the foregoing circumstances, the appellate
court cannot be said to have been without valid basis in

affirming the lower court's ruling that the properties in


controversy belong exclusively to Eusebio.
Now, insofar as the administration of the subject properties
is concerned, it follows that Eusebio shall retain control
thereof considering that the assets are exclusively his
capital. 24 Even assuming for the sake of argument that the
properties are conjugal, petitioner cannot administer themn
inasmuch as Eusebio is not incapacitated. Contrary to the
allegation of petitioner, Eusebio, as found by the lower court,
is not suffering from serious illness so as to impair his fitness
to administer his properties. That he is handicapped due to a
leg injury sustained in a bicycle accident, allegedly
aggravated when petitioner pushed him to the ground in one
of their occasional quarrels, did not render him, in the
Court's view, incapacitated to perform acts of administration
over his own properties.
WHEREFORE, petition is hereby DENIED. The Decision of the
Court of Appeals is AFFIRMED.
Costs against petitioner.
SO ORDERED.

G.R. No. 179010

April 11, 2011

ELENITA M. DEWARA, epresented by her Attorney-inFact, FERDINAND MAGALLANES, Petitioner,


vs.
SPOUSES RONNIE AND GINA LAMELA and STENILE
ALVERO, Respondents.
DECISION
NACHURA, J.:
Before the Court is a petition for review on certiorari under
Rule 45 of the Rules of Court, assailing the Decision 1dated
November 6, 2006 and the Resolution 2 dated July 10, 2007
of the Court of Appeals (CA) in CA-G.R. CV No. 64936, which
reversed and set aside the Decision3 dated September 2,
1999 of the Regional Trial Court (RTC), Branch 54, Bacolod
City, in Civil Case No. 93-7942.
The Facts
Eduardo Dewara (Eduardo) and petitioner Elenita Magallanes
Dewara (Elenita) were married before the enactment of the
Family Code. Thus, the Civil Code governed their marital
relations. Husband and wife were separated-in-fact because
Elenita went to work in California, United States of America,
while Eduardo stayed in Bacolod City.
On January 20, 1985, Eduardo, while driving a private jeep
registered in the name of Elenita,4 hit respondent Ronnie
Lamela (Ronnie). Ronnie filed a criminal case for serious
physical injuries through reckless imprudence5against
Eduardo before the Municipal Trial Court in Cities (MTCC),
Branch IV, Bacolod City. The MTCC found Eduardo guilty of
the charge and sentenced him to suffer the penalty of
imprisonment of two (2) months and one (1) day to (3)
months, and to pay civil indemnity of Sixty-Two Thousand
Five Hundred Ninety-Eight Pesos and Seventy Centavos
(P62,598.70) as actual damages and Ten Thousand Pesos
(P10,000.00) as moral damages. On appeal, the
RTC6 affirmed the decision of the MTCC7 and it became final
and executory.8
The writ of execution on the civil liability was served on
Eduardo, but it was returned unsatisfied because he had no
property in his name. Ronnie requested the City Sheriff,
respondent Stenile Alvero, to levy on Lot No. 234-C, Psd.
26667 of the Bacolod Cadastre, with an area of One
Thousand Four Hundred Forty (1,440) square meters (sq m),
under Transfer Certificate of Title (TCT) No. T-80054, in the
name of "ELENITA M. DEWARA, of legal age, Filipino, married
to Eduardo Dewara, and resident of Bacolod City," to satisfy

the judgment on the civil liability of Eduardo. The City Sheriff


served a notice of embargo on the title of the lot and
subsequently sold the lot in a public auction. In the
execution sale, there were no interested buyers other than
Ronnie. The City Sheriff issued a certificate of sale to
spouses Ronnie and Gina Lamela to satisfy the civil liability
in the decision against Eduardo.9Ronnie then caused the
consolidation of title in a Cadastral Proceeding before the
RTC, which ordered the cancellation of TCT No. T-80054 in
the name of Elenita and the issuance of a new certificate of
title in the name of respondent spouses.10
The levy on execution, public auction, issuance of certificate
of sale, and cancellation of title of the lot in the name of
Elenita were done while Elenita was working in
California.11 Thus, Elenita, represented by her attorney-infact, Ferdinand Magallanes, filed a case for annulment of
sale and for damages against respondent spouses and exofficio sheriff Stenile Alvero before the RTC of Bacolod City.
Petitioner claimed that the levy on execution of Lot No. 234C was illegal because the said property was her paraphernal
or exclusive property and could not be made to answer for
the personal liability of her husband. Furthermore, as the
registered owner of the property, she received no notice of
the execution sale. She sought the annulment of the sale
and the annulment of the issuance of the new TCT in the
name of respondent spouses.12
On the other hand, respondent spouses averred that the
subject lot was the conjugal property of petitioner Elenita
and Eduardo. They asserted that the property was acquired
by Elenita during her marriage to Eduardo; that the property
was acquired with the money of Eduardo because, at the
time of the acquisition of the property, Elenita was a plain
housewife; that the jeep involved in the accident was
registered in the name of petitioner; and that Elenita did not
interpose any objection pending the levy on execution of the
property.13
On September 2, 1999, the RTC rendered a decision in favor
of petitioner, the fallo of which reads:
WHEREFORE, judgment is hereby rendered in favor of the
[petitioner] and against the [respondents]:
1. The levy on execution on Lot No. 234-C of the Bacolod
Cadastre covered by TCT No. 80054 in the name of
[petitioner] Elenita M. Dewara, the public auction of the
property, and the consolidation of the title and issuance of
new TCT No. 167403 in the name of [respondent] Ronnie
Lamela, are hereby declared null and void;
2. The Register of Deeds of Bacolod City is ordered to
cancel TCT No. 167403 in the name of [respondent]
Ronnie Lamela and TCT No. 80054 be reinstated or a new
one issued in the name of [petitioner] Elenita M. Dewara;
3. There is no pronouncement on damages with cost de
officio.
SO ORDERED.

14

The RTC declared that said property was paraphernal in


nature. It arrived at this conclusion by tracing how Elenita
acquired the subject property. Based on the documentary
evidence submitted, Elenitas grandfather, Exequiel
Magallanes, originally owned Lot No. 234-C. Upon his
demise, his children, Jesus (Elenitas father), Salud, and
Concepcion, inherited the property, each entitled to a share
equal to one-third (1/3) of the total area of the land. They
were issued a new title (TCT No. T-17541) for the property.
On July 6, 1966, petitioners aunt, Salud, executed a waiver
of rights duly registered with the Office of the Register of
Deeds under Entry No. 76392, thereby waiving her rights
and participation over her 1/3 share of the property in favor
of her siblings, Jesus and Concepcion. The two siblings then
became the owners of the property, each owning one-half
(1/2) of the property. Jesus subsequently sold his share to his
daughter, Elenita, for the sum of Five Thousand Pesos
(P5,000.00), based on the deed of sale dated March 26,
1975. The deed of sale was duly registered with the Register
of Deeds under Entry No. 76393. Concepcion also sold her

share to her niece, Elenita, for the sum of Ten Thousand


Pesos (P10,000.00), based on the deed of sale dated April
29, 1975, which was duly registered with the Register of
Deeds under Entry No. 76394. By virtue of the sale
transactions, TCT No. T-17541 was cancelled and a new title,
TCT No. T-80054, was issued in the name of Elenita.15
The RTC gave credence to the testimony of Elenita on the
circumstances surrounding the sale of the property. First, it
was sold to her by her father and her aunt so that the family
would remain on the lot. Second, the minimal and
inadequate consideration for the 1,440 sq m property was
for the purpose of helping her expand her capital in her
business at the time. Thus, the sale was essentially a
donation and was therefore gratuitous in character. 16
Having declared that the property was the paraphernal
property of Elenita, the RTC ruled that the civil liability of
Eduardo, which was personal to him, could not be charged to
the exclusive property of his wife.17
On appeal, the CA reversed the decision of the RTC. The
dispositive portion of the Decision reads:
WHEREFORE, in view of all the foregoing, the instant appeal
is GRANTED. The assailed decision of the Regional Trial Court
of Bacolod City, Branch 54, dated September 2, 1999, in
Civil Case No. 93-7942 is hereby REVERSED and SET ASIDE,
and a new Decision is entered DISMISSING the complaint for
lack of merit. Let a copy of this Decision be furnished to the
Office of the Register of Deeds of Bacolod City, Negros
Occidental [which] is hereby ordered to cancel Transfer
Certificate of Title No. T-80054 or any transfer certificate of
title covering Lot No. 234-C issued in the name of Elenita M.
Dewara, and reinstate Transfer Certificate of Title No.
167403 or issue a new transfer certificate of title covering
Lot No. 234-C in the name of Ronnie Lamela. No
pronouncement as to costs.
SO ORDERED.18
In reversing the decision of the RTC, the CA elucidated that
the gross inadequacy of the price alone does not affect a
contract of sale, except that it may indicate a defect in the
consent, or that the parties really intended a donation or
some other act or contract. Except for the assertions of
Elenita, there was nothing in the records that would indicate
a defect in Jesus and Concepcion Magallanes consent to the
sale.19 The CA ruled that Elenita and Eduardo acquired the
property by onerous title during their marriage through their
common fund. Thus, it belonged to the conjugal partnership
of gains and might be levied upon to answer for civil
liabilities adjudged against Eduardo.20
Hence, this petition.
The Issue
The sole issue for resolution is whether the subject property
is the paraphernal/exclusive property of Elenita or the
conjugal property of spouses Elenita and Eduardo.
The answer to this question will define whether the property
may be subject to levy and execution sale to answer for the
civil liability adjudged against Eduardo in the criminal case
for serious physical injuries, which judgment had already
attained finality.
The Ruling of the Court
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.21 Registration in
the name of the husband or the wife alone does not destroy
this presumption.22 The separation-in-fact between the
husband and the wife without judicial approval shall not
affect the conjugal partnership. The lot retains its conjugal
nature.23 Moreover, the presumption of conjugal ownership
applies even when the manner in which the property was
acquired does not appear. The use of the conjugal funds is
not an essential requirement for the presumption to arise. 24

There is no dispute that the subject property was acquired


by spouses Elenita and Eduardo during their marriage. It is
also undisputed that their marital relations are governed by
the conjugal partnership of gains, since they were married
before the enactment of the Family Code and they did not
execute any prenuptial agreement as to their property
relations. Thus, the legal presumption of the conjugal nature
of the property applies to the lot in question. The
presumption that the property is conjugal property may be
rebutted only by strong, clear, categorical, and convincing
evidencethere must be strict proof of the exclusive
ownership of one of the spouses, and the burden of proof
rests upon the party asserting it.25
Aside from the assertions of Elenita that the sale of the
property by her father and her aunt was in the nature of a
donation because of the alleged gross disparity between the
actual value of the property and the monetary consideration
for the sale, there is no other evidence that would convince
this Court of the paraphernal character of the property.
Elenita proffered no evidence of the market value or
assessed value of the subject property in 1975. Thus, we
agree with the CA that Elenita has not sufficiently proven
that the prices involved in the sales in question were so
inadequate for the Court to reach a conclusion that the
transfers were in the nature of a donation rather than a sale.
Furthermore, gross inadequacy of the price does not affect a
contract of sale, except as it may indicate a defect in the
consent, or that the parties really intended a donation or
some other act or contract.26 The records are bereft of proof
that the consent of petitioners father and her aunt were
vitiated or that, in reality, they intended the sale to be a
donation or some other contract. Inadequacy of the price per
se will not rule out the transaction as one of sale; the price
must be grossly inadequate or shocking to the conscience,
such that the mind would revolt at it and such that a
reasonable man would neither directly nor indirectly consent
to it.27
However, even after having declared that Lot No. 234-C is
the conjugal property of spouses Elenita and Eduardo, it
does not necessarily follow that it may automatically be
levied upon in an execution to answer for debts, obligations,
fines, or indemnities of one of the spouses. Before debts and
obligations may be charged against the conjugal
partnership, it must be shown that the same were
contracted for, or the debts and obligations should have
redounded to, the benefit of the conjugal partnership. Fines
and pecuniary indemnities imposed upon the husband or the
wife, as a rule, may not be charged to the partnership.
However, if the spouse who is bound should have no
exclusive property or if the property should be insufficient,
the fines and indemnities may be enforced upon the
partnership assets only after the responsibilities enumerated
in Article 161 of the Civil Code have been covered.
In this case, it is just and proper that Ronnie be
compensated for the serious physical injuries he suffered. It
should be remembered that even though the vehicle that hit
Ronnie was registered in the name of Elenita, she was not
made a party in the said criminal case. Thus, she may not be
compelled to answer for Eduardos liability. Nevertheless,
their conjugal partnership property may be held accountable
for it since Eduardo has no property in his name. The
payment of indemnity adjudged by the RTC of Bacolod City
in Criminal Case No. 7155 in favor of Ronnie may be
enforced against the partnership assets of spouses Elenita
and Eduardo after the responsibilities enumerated under
Article 161 of the Civil Code have been covered. This remedy
is provided for under Article 163 of the Civil Code, viz.:
Art. 163. The payment of debts contracted by the husband
or the wife before the marriage shall not be charged to the
conjugal partnership.1wphi1
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 purposes above-mentioned.28
Article 161 of the Civil Code enumerates the obligations
which the conjugal partnership may be held answerable,
viz.:
Art. 161. The conjugal partnership shall be liable for:
(1) All debts and obligations contracted by the husband
for the benefit of the conjugal partnership, and those
contracted by the wife, also for the same purpose, in the
cases where she may legally bind the partnership;
(2) Arrears or income due, during the marriage, from
obligations which constitute a charge upon property of
either spouse or of the partnership;
(3) Minor repairs or for mere preservation made during the
marriage upon the separate property of either the
husband or the wife; major repairs shall not be charged to
the partnership;
(4) Major or minor repairs upon the conjugal partnership
property;
(5) The maintenance of the family and the education of
the children of both the husband and wife, and of
legitimate children of one of the spouses;
(6) Expenses to permit the spouses to complete a
professional, vocational or other course.
The enumeration above-listed should first be complied with
before the conjugal partnership may be held to answer for
the liability adjudged against Eduardo.
Finally, the indemnity imposed against Eduardo shall earn an
interest at the rate of twelve percent per annum, in
accordance with our ruling in Eastern Shipping Lines, Inc. v.
Court of Appeals.29
WHEREFORE, in view of the foregoing, the Decision dated
November 6, 2006 and the Resolution dated July 10, 2007 of
the Court of Appeals in CA-G.R. CV No. 64936 are hereby
ANNULLED and SET ASIDE. The decision dated September 2,
1999 of the Regional Trial Court of Bacolod City in Civil Case
No. 93-7942 is hereby REINSTATED WITH MODIFICATION that
the conjugal properties of spouses Elenita Dewara and
Eduardo Dewara shall be held to answer for the judgment of
Seventy-Two Thousand Five Hundred Ninety-Eight Pesos and
Seventy Centavos (P72,598.70), plus an interest rate of
twelve (12) percent per annum from the date of finality of
the decision of the Regional Trial Court of Bacolod City in
Criminal Case No. 7155, after complying with the provisions
of Article 161 of the Civil Code.
SO ORDERED.

G.R. No. L-28589 January 8, 1973


RAFAEL ZULUETA, ET AL., plaintiffs-appellees,
vs.
PAN AMERICAN WORLD AIRWAYS, INC., defendantappellant.
Alfredo L. Benipayo for plaintiffs-appellee Rafael Zulueta and
Carolina Zulueta.
Justo L. Albert for plaintiff-appellee Telly Albert Zulueta.
V.E. del Rosario and Associates and Salcedo, Del Rosario,
Bito, Misa and Lozada for defendant-appellant.

District Court. Merchants' Heat & Light Co. v. James B.


Clow & Sons, 204 U.S. 286, 27 S. Ct. 285, 51 L. Ed. 488; O.
J. Lewis Mercantile Co. v. Klepner, 176 F. 343 (C.C.A. 2),
certiorari denied 216 U.S. 620, 30 S Ct. 575, 54 L. Ed. 641.
... . 4
... courts have said that "when the jurisdictional amount is
in question, the tendering of a counterclaim in an amount
which in itself, or added to the amount claimed in the
petition, makes up a sum equal to the amount necessary
to the jurisdiction of this court, jurisdiction is established,
whatever may be the state of the plaintiff's complaint."
American Sheet & Tin Plate Co. v. Winzeler (D.C.) 227 F.
321, 324. 5
Thus, in Ago v. Buslon, 6 We held:

RESOLUTION

CONCEPCION, C.J.:
Both parties in this case have moved for the reconsideration
of the decision of this Court promulgated on February 29,
1972. Plaintiffs maintain that the decision appealed from
should be affirmed in toto. The defendant, in turn, prays that
the decision of this Court be "set aside ... with or without a
new trial, ... and that the complaint be dismissed, with costs;
or, in the alternative, that the amount of the award
embodied therein be considerably reduced." .
Subsequently to the filing of its motion for reconsideration,
the defendant filed a "petition to annul proceedings and/or
to order the dismissal of plaintiffs-appellees' complaint"
upon the ground that "appellees' complaint actually seeks
the recovery of only P5,502.85 as actual damages, because,
for the purpose of determining the jurisdiction of the lower
court, the unspecified sums representing items of alleged
damages, may not be considered, under the settled
doctrines of this Honorable Court," and "the jurisdiction of
courts of first instance when the complaint in the present
case was filed on Sept. 30, 1965" was limited to cases "in
which the demand, exclusive of interest, or the value of the
property in controversy amounts to more than ten thousand
pesos" and "the mere fact that the complaint also prays for
unspecified moral damages and attorney's fees, does not
bring the action within the jurisdiction of the lower court."
We find no merit in this contention. To begin with, it is not
true that "the unspecified sums representing items or other
alleged damages, may not be considered" for the purpose
of determining the jurisdiction of the court "under the
settled doctrines of this Honorable Court." In fact, not a
single case has been cited in support of this allegation.
Secondly, it has been held that a clam for moral damages is
one not susceptible of pecuniary estimation. 1 In fact, Article
2217 of the Civil Code of the Philippines explicitly provides
that "(t)hough incapable of pecuniary computation, moral
damages may be recovered if they are the proximate result
of the defendant's wrongful act or omission." Hence, "(n)o
proof pecuniary loss necessary" pursuant to Article 2216
of the same Code "in order that moral ... damages may be
adjudicated." And "(t)he assessment of such damages ... is
left to the discretion of the court" - said article adds "according to the circumstances of each case." Appellees'
complaint is, therefore, within the original jurisdiction of
courts of first instance, which includes "all civil actions in
which the subject of the litigation is not capable of pecuniary
estimation." 2
Thirdly, in its answer to plaintiffs' original and amended
complainants, defendant had set up a counterclaim in the
aggregate sum of P12,000, which is, also, within the original
jurisdiction of said courts, thereby curing the alleged defect
if any, in plaintiffs' complaint. 3
We need not consider the jurisdictional controversy as to
the amount the appellant sues to recover because the
counterclaim interposed establishes the jurisdiction of the

... . Then, too, petitioner's counterclaim for P37,000.00


was, also, within the exclusive original jurisdiction of the
latter courts, and there are ample precedents to the effect
that "although the original claim involves less than the
jurisdictional amount, ... jurisdiction can be sustained if
the counterclaim (of the compulsory type)" such as the
one set up by petitioner herein, based upon the damages
allegedly suffered by him in consequence of the filing of
said complaint "exceeds the jurisdictional amount."
(Moore Federal Practice, 2nd ed. [1948], Vol. 3, p. 41;
Ginsburg vs. Pacific Mutual Life Ins. Co. of California, 69
Fed. [2d] 97; Home Life Ins. Co. vs. Sipp., 11 Fed. [2d]474;
American Sheet & Tin Plate Co. vs. Winzeler [D.C.], 227
Fed. 321, 324; Brix vs. People's Mutual Life Ins. Co., 41 P.
2d. 537, 2 Cal. 2d. 446; Emery vs. Pacific Employees Ins.
Co., 67 P. 2d. 1046, 8 Cal. 2d. 663).
Needless to say, having not only failed to question the
jurisdiction of the trial court either in that court or in this
Court, before the rendition of the latter's decision, and even
subsequently thereto, by filing the aforementioned motion
for reconsideration and seeking the reliefs therein prayed for
but, also, urged both courts to exercise jurisdiction over
the merits of the case, defendant is now estopped from
impugning said jurisdiction. 7
Before taking up the specific questions raised in defendant's
motion for reconsideration, it should be noted that the same
is mainly predicated upon the premise that plaintiffs' version
is inherently incredible, and that this Court should accept the
theory of the defense to the effect that petitioner was offloaded because of a bomb-scare allegedly arising from his
delay in boarding the aircraft and subsequent refusal to
open his bags for inspection. We need not repeat here the
reasons given in Our decision for rejecting defendant's
contention and not disturbing the findings of fact of His
Honor, the Trial Judge, who had the decided advantage
denied to Us of observing the behaviour of the witnesses
in the course of the trial and found those of the plaintiffs
worthy of credence, not the evidence for the defense.
It may not be amiss however, to stress the fact that, in his
written report, made in transit from Wake to Manila
or immediately after the occurrence and before the legal
implications or consequences thereof could have been the
object of mature deliberation, so that it could, in a way, be
considered as part of the res gestae Capt. Zentner stated
that Zulueta had been off-loaded "due to drinking" and
"belligerent attitude," thereby belying the story of the
defense about said alleged bomb-scare, and confirming the
view that said agent of the defendant had acted out of
resentment because his ego had been hurt by Mr. Zulueta's
adamant refusal to be bullied by him. Indeed, had there
been an iota of truth in said story of the defense, Capt.
Zentner would have caused every one of the passengers to
be frisked or searched and the luggage of all of them
examined as it is done now before resuming the flight
from Wake Island. His failure to do so merely makes the
artificious nature of defendant's version more manifest.
Indeed, the fact that Mrs. Zulueta and Miss Zulueta were on
board the plane shows beyond doubt that Mr. Zulueta could
not possibly have intended to blow it up.

The defense tries to explain its failure to introduce any


evidence to contradict the testimony of Mr. Zulueta as to
why he had gone to the beach and what he did there,
alleging that, in the very nature of things, nobody else could
have witnessed it. Moreover, the defense insists, inter alia,
that the testimony of Mr. Zulueta is inherently incredible
because he had no idea as to how many toilets the plane
had; it could not have taken him an hour to relieve himself in
the beach; there were eight (8) commodes at the terminal
toilet for men ; if he felt the need of relieving himself, he
would have seen to it that the soldiers did not beat him to
the terminal toilets; he did not tell anybody about the reason
for going to the beach, until after the plane had taken off
from Wake.
We find this pretense devoid of merit. Although Mr. Zulueta
had to look for a secluded place in the beach to relieve
himself, beyond the view of others, defendant's airport
manager, whom Mr. Zulueta informed about it,soon after the
departure of the plane, could have forthwith checked the
veracity of Mr. Zulueta's statement by asking him to indicate
the specific place where he had been in the beach and then
proceeding thereto for purposes of verification.
Then, again, the passenger of a plane seldom knows how
many toilets it has. As a general rule, his knowledge is
limited to the toilets for the class first class or tourist class
in which he is. Then, too, it takes several minutes for the
passengers of big aircrafts, like those flying from the U.S. to
the Philippines, to deplane. Besides, the speed with which a
given passenger may do so depends, largely, upon the
location of his seat in relation to the exit door. He cannot go
over the heads of those nearer than he thereto. Again, Mr.
Zulueta may have stayed in the toilet terminal for some
time, expecting one of the commodes therein to be vacated
soon enough, before deciding to go elsewhere to look for a
place suitable to his purpose. But he had to walk, first, from
the plane to the terminal building and, then, after vainly
waiting therein for a while, cover a distance of about 400
yards therefrom to the beach, and seek there a place not
visible by the people in the plane and in the terminal,
inasmuch as the terrain at Wake Island is flat. What is more,
he must have had to takeoff part, at least, of his clothing,
because, without the facilities of a toilet, he had to wash
himself and, then, dry himself up before he could be
properly attired and walk back the 400 yards that separated
him from the terminal building and/or the plane.
Considering, in addition to the foregoing, the fact that he
was not feeling well, at that time, We are not prepared to
hold that it could not have taken him around an hour to
perform the acts narrated by him.
But, why asks the defendant did he not reveal the
same before the plane took off? The record shows that, even
before Mr. Zulueta had reached the ramp leading to the
plane, Capt. Zentner was already demonstrating at him in an
intemperate and arrogant tone and attitude ("What do you
think you are?), thereby impelling Mr. Zulueta to answer
back in the same vein. As a consequence, there immediately
ensued an altercation in the course of which each apparently
tried to show that he could not be cowed by the other. Then
came the order of Capt. Zentner to off-load all of the
Zuluetas, including Mrs. Zulueta and the minor Miss Zulueta,
as well as their luggage, their overcoats and other effects
handcarried by them; but, Mr. Zulueta requested that the
ladies be allowed to continue the trip. Meanwhile, it had
taken time to locate his four (4) pieces of luggage. As a
matter of fact, only three (3) of them were found, and the
fourth eventually remained in the plane. In short, the issue
between Capt. Zentner and Mr. Zulueta had been limited to
determining whether the latter would allow himself to be
browbeaten by the former. In the heat of the altercation,
nobody had inquired about the cause of Mr. Zulueta's delay
in returning to the plane, apart from the fact that it was
rather embarrassing for him to explain, in the presence and
within the hearing of the passengers and the crew, then
assembled around them, why he had gone to the beach and
why it had taken him some time to answer there a call of
nature, instead of doing so in the terminal building.
Defendant's motion for reconsideration assails: (1) the
amount of damages awarded as excessive; (2) the propriety
of accepting as credible plaintiffs' theory; (3) plaintiffs' right
to recover either moral or exemplary damages; (4) plaintiffs'

right to recover attorney's fees; and (5) the non-enforcement


of the compromise agreement between the defendant and
plaintiff's wife, Mrs. Zulueta. Upon the other hand, plaintiffs'
motion for reconsideration contests the decision of this Court
reducing the amount of damages awarded by the trial court
to approximately one-half thereof, upon the ground, not only
that, contrary to the findings of this Court, in said decision,
plaintiff had not contributed to the aggravation of his
altercation or incident with Capt. Zentner by reacting to his
provocation with extreme belligerency thereby allowing
himself to be dragged down to the level on which said agent
of the defendant had placed himself, but, also, because the
purchasing power of our local currency is now much lower
than when the trial court rendered its appealed decision,
over five (5) years ago, on July 5, 1967, which is an
undeniable and undisputed fact. Precisely, for this reason,
defendant's characterization as exorbitant of the aggregate
award of over P700,000 by way of damages, apart from
attorney's fees in the sum of P75,000, is untenable. Indeed,
said award is now barely equivalent to around 100,000 U. S.
dollars.
It further support of its contention, defendant cites the
damages awarded in previous cases to passengers of
airlines, 8 as well as in several criminal cases, and some
cases for libel and slander. None of these cases is, however,
in point. Said cases against airlines referred to passengers
who were merely constrained to take a tourist class
accommodation, despite the fact that they had first class
tickets, and that although, in one of such cases, there was
proof that the airline involved had acted as it did to give
preference to a "white" passenger, this motive was not
disclosed until the trial in court. In the case at bar, plaintiff
Rafael Zulueta was "off-loaded" at Wake Island, for having
dared to retort to defendant's agent in a tone and manner
matching, if not befitting his intemperate language and
arrogant attitude. As a consequence, Capt. Zentner's
attempt to humiliate Rafael Zulueta had boomeranged
against him (Zentner), in the presence of the other
passengers and the crew. It was, also, in their presence that
defendant's agent had referred to the plaintiffs as
"monkeys," a racial insult not made openly and publicly in
the abovementioned previous cases against airlines.
In other words, Mr. Zulueta was off-loaded, not to protect
the safety of the aircraft and its passengers, but to retaliate
and punish him for the embarrassment and loss of face thus
suffered by defendant's agent. This vindictive motive is
made more manifest by the note delivered to Mr. Zulueta by
defendant's airport manager at Wake Island, Mr. Sitton,
stating that the former's stay therein would be "for
a minimum of one week," during which he would be charged
$13.30 per day. This reference to a "minimum of one week"
revealed the intention to keep him there stranded that long,
for no other plane, headed for Manila, was expected within
said period of time, although Mr. Zulueta managed to board,
days later, a plane that brought him to Hawaii, whence he
flew back to the Philippines, via Japan.
Neither may criminal cases, nor the cases for libel and
slander cited in the defendant's motion for reconsideration,
be equated with the present case. Indeed, in ordinary
criminal cases, the award for damages is, in actual practice,
of purely academic value, for the convicts generally belong
to the poorest class of society. There is, moreover, a
fundamental difference between said cases and the one at
bar. The Zuluetas had a contract of carriage with the
defendant, as a common carrier, pursuant to which the latter
was bound, for a substantial monetary considerationpaid by
the former, not merely to transport them to Manila, but,
also, to do so with "extraordinary diligence" or "utmost
diligence." 9 The responsibility of the common carrier, under
said contract, as regards the passenger's safety, is of such a
nature, affecting as it does public interest, that it "cannot
be dispensed with" or even "lessened by stipulation, by the
posting of notices, by statements on tickets, or
otherwise." 10 In the present case, the defendant did not
only fail to comply with its obligation to transport Mr. Zulueta
to Manila, but, also, acted in a manner calculated to
humiliate him, to chastise him, to make him suffer, to cause
to him the greatest possible inconvenience, by leaving him
in a desolate island, in the expectation that he would be
stranded there for a "minimum of one week" and, in addition
thereto, charged therefor $13.30 a day.

It is urged by the defendant that exemplary damages are not


recoverable in quasi-delicts, pursuant to Article 2231 of our
Civil Code, except when the defendant has acted with "gross
negligence," and that there is no specific finding that it had
so acted. It is obvious, however, that in off-loading plaintiff
at Wake Island, under the circumstances heretofore
adverted to, defendant's agents had acted with malice
aforethought and evident bad faith. If "gross negligence"
warrants the award of exemplary damages, with more
reason is its imposition justified when the act performed is
deliberate, malicious and tainted with bad faith. Thus,
in Lopez v. PANAM, 11 We held:
The rationale behind exemplary or corrective damages is,
as the name implies, to provide an example or correction
for public good. Defendant having breached its contracts
in bad faith, the court, as stated earlier, may award
exemplary damages in addition to moral damages
(Articles 2229, 2232, New Civil Code.)
Similarly, in NWA v. Cuenca, 12 this Court declared that an
award for exemplary damages was justified by the fact that
the airline's "agent had acted in a wanton, reckless
and oppressive manner" in compelling Cuenca, upon arrival
at Okinawa, to transfer, over his objection, from the first
class, where he was accommodated from Manila to Okinawa,
to the tourist class, in his trip to Japan, "under threat of
otherwise leaving him in Okinawa," despite the fact that he
had paid in full the first class fare and was issued in Manila a
first class ticket.
Defendant cites Rotea v. Halili, 13 in support of the
proposition that a principal is not liable for exemplary
damages owing to acts of his agent unless the former has
participated in said acts or ratified the same. Said case
involved, however, the subsidiary civil liability of an
employer arising from criminal acts of his employee, and
"exemplary damages ... may be imposed when the crime
was committed with one or more aggravating
circumstances." 14 Accordingly, the Rotea case is not in
point, for the case at bar involves a breach of contract, as
well as a quasi-delict.
Neither may the case of Palisoc v. Brillantes, 15 invoked by
the defendant, be equated with the case at bar. The Palisoc
case dealt with the liability of school officials for damages
arising from the death of a student (Palisoc) due to fist blows
given by another student (Daffon), in the course of a quarrel
between them, while in a laboratory room of the Manila
Technical Institute. In an action for damages, the head
thereof and the teacher in charge of said laboratory were
held jointly and severally liable with the student who caused
said death, for failure of the school to provide "adequate
supervision over the activities of the students in the school
premises," to protect them "from harm, whether at the
hands of fellow students or other parties." Such liability was
predicated upon Article 2180 of our Civil Code, the pertinent
part of which reads:
ART. 2180. The obligation imposed by Article 2176 is
demandable not only for one's own acts or omissions, but
also for those of persons for whom one is responsible.
xxx xxx xxx
Lastly, teachers or heads of establishments of arts and
trades shall be liable for damages caused by their pupils
and students or apprentices, so long as they remain in
their custody.
xxx xxx xxx
Obviously, the amount of damages warded in the Palisoc
case is not and cannot serve as the measure of the damages
recoverable in the present case, the latter having been
caused directly and intentionally by an employee or agent of
the defendant, whereas the student who killed the young
Palisoc was in no wise an agent of the school. Moreover,
upon her arrival in the Philippines, Mrs. Zulueta reported her
husband's predicament to defendant's local manager and
asked him to forthwith have him (Mr. Zulueta) brought to
Manila, which defendant's aforementioned manager refused

to do, thereby impliedly ratifying the off-loading of Mr.


Zulueta at Wake Island.
It is next urged that, under the contract of carriage with the
defendant, Mr. Zulueta was bound to be present at the time
scheduled for the departure of defendant's plane and that
he had, consequently, violated said contract when he did not
show up at such time. This argument might have had some
weight had defendant's plane taken off before Mr. Zulueta
had shown up. But the fact is that he was ready, willing and
able to board the plane about two hours before it actually
took off, and that he was deliberately and maliciously offloaded on account of his altercation with Capt. Zentner. It
should, also, be noted that, although Mr. Zulueta was
delayed some 20 to 30 minutes, the arrival or departure of
planes is often delayed for much longer periods of time.
Followed to its logical conclusion, the argument adduced by
the defense suggests that airlines should be held liable for
damages due to the inconvenience and anxiety, aside from
actual damages, suffered by many passengers either in their
haste to arrive at the airport on scheduled time just to find
that their plane will not take off until later, or by reason of
the late arrival of the aircraft at its destination.
PANAM impugns the award of attorney's fees upon the
ground that no penalty should be imposed upon the right to
litigate; that, by law, it may be awarded only in exceptional
cases; that the claim for attorney's fees has not been
proven; and that said defendant was justified in resisting
plaintiff's claim "because it was patently exorbitant."
Nothing, however, can be farther from the truth. Indeed
apart from plaintiff's claim for actual damages, the amount
of which is not contested, plaintiffs did not ask any specific
sum by way of exemplary and moral damages, as well as
attorney's fees, and left the amount thereof to the "sound
discretion" of the lower court. This, precisely, is the reason
why PANAM, now, alleges without justification that the
lower court had no jurisdiction over the subject matter of the
present case.
Moreover, Article 2208 of our Civil Code expressly authorizes
the award of attorney's fees "when exemplary damages are
awarded," as they are in this case as well as "in any
other case where the court deems it just and equitable that
attorney's fees ... be recovered," and We so deem it just and
equitable in the present case, considering the "exceptional"
circumstances obtaining therein, particularly the bad faith
with which defendant's agent had acted, the place where
and the conditions under which Rafael Zulueta was left at
Wake Island, the absolute refusal of defendant's manager in
Manila to take any step whatsoever to alleviate Mr. Zulueta's
predicament at Wake and have him brought to Manila
which, under their contract of carriage, was defendant's
obligation to discharge with "extra-ordinary" or "utmost"
diligence and, the "racial" factor that had, likewise,
tainted the decision of defendant's agent, Capt. Zentner, to
off-load him at Wake Island.
As regards the evidence necessary to justify the sum of
P75,000 awarded as attorney's fees in this case, suffice it to
say that the quantity and quality of the services rendered by
plaintiffs' counsel appearing on record, apart from the nature
of the case and the amount involved therein, as well as his
prestige as one of the most distinguished members of the
legal profession in the Philippines, of which judicial
cognizance may be taken, amply justify said award, which is
a little over 10% of the damages (P700,000) collectible by
plaintiffs herein. Indeed, the attorney's fees in this case is
proportionally much less than that adjudged in Lopez v.
PANAM 16 in which the judgment rendered for attorney's fees
(P50,000) was almost 20% of the damages (P275,000)
recovered by the plaintiffs therein.
The defense assails the last part of the decision sought to be
reconsidered, in which relying upon Article 172 of our Civil
Code, which provides that "(t)he wife cannot bind the
conjugal partnership without the husband's consent, except
in cases provided by law," and it is not claimed that this is
one of such cases We denied a motion, filed by Mrs.
Zulueta, for the dismissal of this case, insofar as she is
concerned - she having settled all her differences with the
defendant, which appears to have paid her the sum of

P50,000 therefor - "without prejudice to this sum being


deducted from the award made in said decision." Defendant
now alleges that this is tantamount to holding that said
compromise agreement is both effective and ineffective.
This, of course, is not true. The payment is effective, insofar
as it is deductible from the award, and, because it is due (or
part of the amount due) from the defendant, with or
without its compromise agreement with Mrs. Zulueta. What
is ineffective is the compromise agreement, insofar as the
conjugal partnership is concerned. Mrs. Zulueta's motion
was for the dismissal of the case insofar as she was
concerned, and the defense cited in support thereof Article
113 of said Code, pursuant to which "(t)he husband must be
joined in all suits by or against the wife except: ... (2) If they
have in fact been separated for at least one year." This
provision, We held, however, refers to suits in which the wife
is the principal or real party in interest, not to the case at
bar, "in which the husband is the main party in interest, both
as the person principally aggrieved and as administrator of
the conjugal partnership ... he having acted in this capacity
in entering into the contract of carriage with PANAM and
paid the amount due to the latter, under the contract, with
funds of the conjugal partnership," to which the amounts
recoverable for breach of said contract, accordingly, belong.
The damages suffered by Mrs. Zulueta were mainly an in
accident of the humiliation to which her husband had been
subjected. The Court ordered that said sum of P50,00 paid
by PANAM to Mrs. Zulueta be deducted from the aggregate
award in favor of the plaintiffs herein for the simple reason
that upon liquidation of the conjugal partnership, as
provided by law, said amount would have to be reckoned
with, either as part of her share in the partnership, or as part
of the support which might have been or may be due to her
as wife of Rafael Zulueta. It would surely be inane to
sentence the defendant to pay the P700,000 due to the
plaintiffs and to direct Mrs. Zulueta to return said P50,000 to
the defendant.
In this connection, it is noteworthy that, for obvious reasons
of public policy, she is not allowed by law to waive her share
in the conjugal partnership, before the dissolution
thereof. 17 She cannot even acquire any property by
gratuitous title, without the husband's consent, except from
her ascendants, descendants, parents-in-law, and collateral
relatives within the fourth degree. 18
It is true that the law favors and encourages the settlement
of litigations by compromise agreement between the
contending parties, but, it certainly does not favor a
settlement with one of the spouses, both of whom are
plaintiffs or defendants in a common cause, such as the
defense of the rights of the conjugal partnership, when the
effect, even if indirect, of the compromise is to jeopardize
"the solidarity of the family" which the
law 19 seeks to protect by creating an additional cause for
the misunderstanding that had arisen between such spouses
during the litigation, and thus rendering more difficult a
reconciliation between them.
It is urged that there is no proof as to the purpose of the trip
of the plaintiffs, that neither is there any evidence that the
money used to pay the plane tickets came from the conjugal
funds and that the award to Mrs. Zulueta was for her
personal suffering or injuries. There was, however, no
individual or specific award in favor of Mrs. Zulueta or any of
the plaintiffs. The award was made in their favor collectively.
Again, in the absence of said proof, the presumption is that
the purpose of the trip was for the common benefit of the
plaintiffs and that the money had come from the conjugal
funds, for, unless there is proof to the contrary, it is
presumed "(t)hat things have happened according to the
ordinary course of nature and the ordinary habits of
life." 20 In fact Manresa maintains21 that they are deemed
conjugal, when the source of the money used therefor is not
established, even if the purchase had been made by the
wife. 22 And this is the rule obtaining in the Philippines. Even
property registered, under the Torrens system, in the name
of one of the spouses, or in that of the wife only, if acquired
during the marriage, is presumed to belong to the conjugal
partnership, unless there is competent proof to the
contrary. 23

PANAM maintains that the damages involved in the case at


bar are not among those forming part of the conjugal
partnership pursuant to Article 153 of the Civil Code,
reading:
ART. 153. The following are conjugal partnership property:
(1) That which is acquired by onerous title during the
marriage at the expense of the common fund, whether the
acquisition be for the partnership, or for only one of the
spouses;
(2) That which is obtained by the industry, or work, or as
salary of the spouses, or of either of them;
(3) The fruits, rents or interests received or due during
the marriage, coming from the common property or from
the exclusive property of each spouse.
Considering that the damages in question have arisen
from, inter alia, a breach of plaintiffs' contract of carriage
with the defendant, for which plaintiffs paid their fare with
funds presumably belonging to the conjugal partnership, We
hold that said damages fall under paragraph (1) of said
Article 153, the right thereto having been "acquired
byonerous title during the marriage ... ." This conclusion is
bolstered up by Article 148 of our Civil Code, according to
which:
ART. 148. The following shall be the exclusive property of
each spouse:
(1) That which is brought to the marriage as his or her
own;
(2) That which each acquires, during the marriage, by
lucrative title;
(3) That which is acquired by right of redemption or by
exchange with other property belonging to only one of the
spouses;
(4) That which is purchased with exclusive money of the
wife or of the husband.
The damages involved in the case at bar do not come under
any of these provisions or of the other provisions forming
part of Chapter 3, Title VI, of Book I of the Civil Code, which
chapter is entitled "Paraphernal Property." What is more, if
"(t)hat which is acquired by right of redemption or by
exchange with other property belonging to only one of the
spouses," and "(t)hat which is purchased with exclusive
money of the wife or of the husband," 24belong exclusively to
such wife or husband, it follows necessarily that that which
is acquired with money of the conjugal partnership belongs
thereto or forms part thereof. The rulings in Maramba v.
Lozano 25 and Perez v. Lantin, 26 cited in defendant's motion
for reconsideration, are, in effect, adverse thereto. In both
cases, it was merely held that the presumption under Article
160 of our Civil Code to the effect that all property of the
marriage belong to the conjugal partnership does not
apply unless it is shown that it was acquired during
marriage. In the present case, the contract of carriage was
concededly entered into, and the damages claimed by the
plaintiffs were incurred, during marriage. Hence, the rights
accruing from said contract, including those resulting from
breach thereof by the defendant, are presumed to belong to
the conjugal partnership of Mr. and Mrs. Zulueta. The fact
that such breach of contract was coupled, also, with a quasidelict constitutes an aggravating circumstance and can not
possibly have the effect of depriving the conjugal
partnership of such property rights.
Defendant insists that the use of conjugal funds to redeem
property does not make the property redeemed conjugal if
the right of redemption pertained to the wife. In the
absence, however, of proof that such right of redemption
pertains to the wife and there is no proof that the contract
of carriage with PANAM or the money paid therefor belongs
to Mrs. Zulueta the property involved, or the rights arising

therefrom, must be presumed, therefore, to form part of the


conjugal partnership.
It is true that in Lilius v. Manila Railroad Co., 27 it was held
that the "patrimonial and moral damages" awarded to a
young and beautiful woman by reason of a scar in
consequence of an injury resulting from an automobile
accident which disfigured her face and fractured her left
leg, as well as caused a permanent deformity, are her
paraphernal property. Defendant cites, also, in support of its
contention the following passage from Colin y Capitant:
No esta resuelta expresamente en la legislacion
espaola la cuestion de si las indemnizaciones debidas
por accidentes del trabaho tienen la consideracion de
gananciales, o son bienes particulares de los conyuges.
Inclinan a la solucion de que estas indemnizaciones deben
ser consideradas como gananciales, el hecho de que la
sociedad pierde la capacidad de trabajocon el accidente,
que a ella le pertenece, puesto que de la sociedad son
losfrutos de ese trabajo; en cambio, la consideracion de
que igual manera que losbienes que sustituyen a los que
cada conyuge lleva al matrimonio como propiostienen el
caracter de propios, hace pensar que las indemnizaciones
que vengana suplir la capacidad de trabajo aportada por
cada conyuge a la sociedad, debenser juridicamente
reputadas como bienes propios del conyuge que haya
sufrido elaccidente. Asi se llega a la misma solucion
aportada por la jurisprudencia francesca. 28
This opinion is, however, undecisive, to say the least. It
should be noted that Colin y Capitant were commenting on
the French Civil Code; that their comment referred to
indemnities due in consequence of "accidentes del trabajo
"resulting in physical injuries sustained by one of the
spouses (which Mrs. Zulueta has not suffered); and that said
commentators admit that the question whether or not said
damages are paraphernal property or belong to the conjugal
partnership is not settled under the Spanish law. 29 Besides,
the French law and jurisprudence to which the comments
of Planiol and Ripert, likewise, refer are inapposite to the
question under consideration, becausethey differ
basically from the Spanish law in the treatment of the
property relations between husband and wife. Indeed, our
Civil Code, like the Spanish Civil Code, favors the system of
conjugal partnership of gains. Accordingly, the former
provides that, "(i)n the absence of marriage settlements, or
when the same are void, the system of relative community
or conjugal partnership of gains ... shall govern the property
relations between" the spouses. 30 Hence, "(a)ll 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." 31
No similar rules are found in the French Civil Code. What is
more, under the provisions thereof, the conjugal partnership
exists only when so stipulated in the "capitulaciones
matrimoniales" or by way of exception. In the language of
Manresa
Prescindimos de los preceptos de los Condigos de
Francia, Italia, Holanda, Portugal, Alemania y Suiza,
porsue solo excepcionalmente, o cuando asi se pacta en
las capitulaciones, admiten el sistema de gananciales. 32
Again, Colin y Capitant, as well as the Lilius case, refer to
damages recovered for physical injuries suffered by the wife.
In the case at bar, the party mainly injured, although not
physically, is the husband.
Accordingly, the other Philippine cases 33 and those from
Louisiana whose civil law is based upon the French Civil
Code cited by the defendant, which similarly refer to
moral damages due to physical injuries suffered by the wife,
are, likewise, inapplicable to the case at bar.
We find, therefore, no plausible reason to disturb the views
expressed in Our decision promulgated on February 29,
1972.

WHEREFORE, the motions for reconsideration above-referred


to should be, as they are hereby denied.

G.R. No. L-31618 August 17, 1983


EFREN R. MENDOZA and INOCENCIA R. DE
MENDOZA, petitioner,
vs.
PONCIANO S. REYES and THE COURT OF
APPEALS, respondents.
G.R. No. L-31625 August 17, 1983
JULIA R. DE REYES, petitioner,
vs.
PONCIANO S. REYES and COURT OF
APPEALS, respondents.
Conrado B. Enriquez and Elpidio G. Navarro for petitioners.
Pacifico M. Castro for respondents.

GUTIERREZ, JR., J.:


Questioned in these consolidated petitions for review on
certiorari is the decision of the Court of Appeals, now
Intermediate Appellate Court, reversing the decision of the
Court of First Instance of Rizal, Quezon City Branch. The
dispositive portion of the appellate decision reads:
WHEREFORE, (a) the judgment appealed from is hereby
reversed; (b) the deed of sale executed by appellee Julia
de Reyes on March 3, 1961 in favor of appellees Efren V.
Mendoza and Inocencia R. Mendoza, covering lots 5 and 6,
Block No. 132 of Subdivision Plan Psd. 14841, situated at
Retiro Street, Quezon City, is hereby declared null and
void with respect to one- half share of appellant therein;
(c) the Register of Deeds of Quezon City is hereby directed
to cancel TCT Nos. 5611 0 and 56111, now covering said
lots, and to issue, in lieu thereof, certificates of title in
favor of appellant Ponciano S. Reyes for one-half (1/2) proindiviso and the spouses Efren V. Mendoza and Inocencia
Mendoza for one-half (1/2) also pro-indiviso; (d) the
appellees Mendozas are hereby ordered to pay unto the
appellant the accrued rentals of style properties in
litigation due to the share corresponding to said appellant,
at the rate of P350.00 a month from March 3, 1961 until
the finality of this decision, with legal interest thereon;
and (e) said appellees are likewise ordered to pay unto the
appellant the amount of THREE THOUSAND (P3,000.00)
PESOS as attorney's fees, plus the costs in both instances.
This case originated with the filing of a complaint by
Ponciano S. Reyes with the Court of First Instance of Rizal
docketed as Civil Case No. Q-6905, for the annulment of a
deed of sale of two parcels of land with their improvements,
executed by his wife, Julia R. De Reyes as vendor and the
spouses Efren V. Mendoza and Inocencia R. De Mendoza, as
vendees. Ponciano S. Reyes averred that said properties
were conjugal properties of himself and his wife and that she
had sold them to petitioners "all by herself" and without his
knowledge or consent.
Petitioners Efren V. Mendoza and Inocencia R. De Mendoza
alleged in their answer that the properties were paraphernal
properties of Julia R. de Reyes and that they had purchased
the same in good faith and for adequate consideration. In a
separate answer, petitioner Julia R. De Reyes, supported the
spouses Mendozas' contentions.
In its decision, the Court of First Instance of Rizal dismissed
the complaint and declared the properties in question
exclusive and paraphernal properties of petitioner Julia R. De
Reyes. It ruled that she could validly dispose of the same
without the consent of her husband and that the Mendozas
are innocent purchasers.

As earlier stated, the Court of Appeals reversed the decision


of the court a quo.
The petitioners filed separate petitions for review on
certiorari. Efren V. Mendoza and Inocencia R. De Mendoza
raised the following assignments of errors:
I
THE COURT OF APPEALS ERRED NOT MERELY IN GIVING
CREDENCE, BUT IN FACT IN CONSIDERING AT ALL, PROOF OF
THE ALLEGED CONJUGAL CHARACTER OF THE PROPERTIES l-,
QUESTION, AND IN NOT INVOKING THE DOCTRINE -E OF
ESTOPPEL TO RULE OUT ANY AND ALL SUCH PROOF
ALTOGETHER.
II
THE COURT OF APPEALS ERRED IN FINDING PETITIONERS
GUILTY OF BAD FAITH IN PURCHASING THE PROPERTIES
LITIGATED FOR WITHOUT EVIDENCE OF SUCH FACT BEING
PRESENTED AND, ON THE STRENGTH MERELY OF A SIMPLE
PRESUMPTION UNWARRANTEDLY DRAWN FROM ONE OF ITS
OWN OBSCURE AND HARDLY AUTHORITATIVE RULINGS, AND
AGAINST ABUNDANT, POSITIVE AND UNCONTRADICTED
PROOF OF GOOD FAITH.

obtained a loan of P12,000.00 from the RFC for the


following exclusive purposes only: 'to complete the
construction of one-storey residential building on 9th
Street, La Loma Quezon City; and to pay the balance of
the price of the lot offered as security' which is Lot 5,
(Deed of Mortgage, Exh. 'A') l'). Out of this loan, the
amount of P5,292.00 was paid to Araneta as price of Lot 5.
The corresponding deed of absolute sale thereof was
executed by Araneta on November 27, 1948 (Exh. 'A'). On
October 2, 1952, the spouses secured an additional loan
of P8,000.00 from the RFC 'to pay the balance of the lot
herein offered (Lot No. 6) as additional security, and to
defray the expenses incurred in the repairs of the building'
as the deed of mortgage so recites (Exh. 'B- l'). From the
amount of this loan, the sum of P7,719.60, as price of Lot
No. 6, was paid and the deed of absolute sale was
forthwith executed by Araneta (Exh. 'B'). In the deed of
sale, the vendee named is 'Julia de Reyes'. Her signatures
appear over the caption vendee and those of Ponciano
under the phrase: 'with my marital consent.
As a result of these sales, Transfer Certificates of Title Nos.
8550 (Exh. 'F') and 19998 (Exh. 'G') were issued for Lots 5
and 6, respectively, by the Register of Deeds of Quezon
City, in the name of "JULIA REYES married to PONCIANO
REYES." The mortgage contracts (Exhs. 'A-1' and 'B-1')
executed by the spouses in favor of the RFC were duly
registered and annotated on the said transfer Certificates
of Title (Exhs. 'F' and 'G').

III
THE COURT OF APPEALS ERRED UPON EQUITABLE GROUNDS
IN, IN EFFECT, GIVING JUDICIAL FLAT To THE UNJUST
ENRICHMENT OR BENEFIT OF ONE PERSON AT THE EXPENSE
OF ANOTHER OR OTHERS.
On the other hand, Julia R. De Reyes made the following
assignments of errors in her petition for review.
THE COURT OF APPEALS ERRED IN DECLARING THAT THE
PROPERTIES IN QUESTION ARE THE CONJUGAL
PROPERTIES OF THE RESPONDENT PONCIANO S. REYES
AND THE PETITIONER IN SPITE OF THE CATEGORICAL
JUDICIAL DECLARATION AND ADMISSION BY SAID
RESPONDENT THAT THE SAID PROPERTIES ARE THE
EXCLUSIVE AND PARAPHERNAL PROPERTIES OF HIS WIFE,
THE PETITIONER HEREIN.
THE COURT OF APPEALS ERRED IN HAVING DECIDED THE
CASE NOT IN ACCORDANCE WITH LAW AND THE
APPLICABLE DECISIONS ON THE MATTER IN THE SENSE,
PARTICULARLY, THAT THE ACT AND DECLARATION OF A
PARTY AGAINST HIS INTERESTS CAN NOT BE
CONTRADICTED BY HIM, AND IN SO DOING THE DECISION
AMOUNTED TO SANCTIONING A PERJURED TESTIMONY.
On the first issue regarding the alleged paraphernal
character of the disputed properties, we find that the records
sustain the findings of the Court of Appeals
The fact are:

As promised to the RFC, the spouses built a house and


later a camarin on the two lots. The camarin was leased as
a school building to the Quezon City Elementary School of
La Loma for the period of two years (1950-51) at P500.00
a month. When the school was transferred to another
place, the camarin was leased on December 10, 1952 to
Mr. and Mrs. Mendoza, appellees, for ten years at P600.00
a month for the first year and P700.00 for the remaining
nine years. The contract of lease was signed by Julia as
lessor, with the marital consent of Ponciano. The camarin
was converted into a movie house and used as such by
the lessees. (Exh. 'G').
In spite of the good rentals they had been receiving for the
building, the spouses failed to pay seasonably their
obligations to the RFC so, as late as November 28, 1958,
they had to ask for an extension of 5 years from the
Development Bank of the Philippines or DBP, as successor
of the RFC, for the payment of an outstanding balance of
P7,876.13 (Exh. 'D').
On March 3, 1961, while Ponciano was absent attending
his farm in Arayat, Pampanga, Julia sold absolutely the lots
in question, together with their improvements to appellees
Mendozas for the sum of P80,000.00 without the
knowledge and consent of Ponciano (Exh. 'I'-Mendoza). At
the same time the spouses were living separately and
were not in speaking terms. By virtue of such sale,
Transfer Certificates of Title Nos. 561 10 and 56111 were
subsequently issued in the name of the Mendozas.
The applicable provision of law is Article 153 of the Civil
Code which provides:

xxx xxx xxx


ART. 153. The following are conjugal partnership property:
... Ponciano Reyes and Julia de Reyes-to be herein referred
to as Ponciano and Julia alone for brevity-were married in
1915. The properties in question consisting of Lots 5 and
6, Block No. 132, situated at Retiro Street, Quezon Cityplus the buildings erected thereon, were bought from J. M.
Tuason & Co., represented by Gregorio Araneta, Inc. to be
herein mentioned as "Araneta"-February, 1947 on
installment basis. (Testimony of Julia, t.s.n., p. 74,
February 15, 1963). The first installment on Lot No. 5 was
P69.96 and on Lot No. 6 was P102.00 (Exh. 'H' and
uncontradicted testimony of Ponciano, t.s.n., p. 4, July 20,
1964).
The spouses were always in arrears in the payment of the
installments to Araneta due to lack of money (t.s.n., pp. 57, July 20, 1964) so they had to borrow money from the
Rehabilitation Finance Corporation-herein after referred to
as RFC for short. Thus, on November 26, 1948, they jointly

(1) That which is acquired by onerous title during the


marriage at the expense of the common fund, whether the
acquisition be for the partnership, or for only one of the
spouses;
xxx xxx xxx
The presumption found in Article 160 of the Civil Code must
also be overcome by one who contends that the disputed
property is paraphernal Article 160 provides:
ART. 160. 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 presumption is a strong one. As stated in Camia de


Reyes v. Reyes de Ilano (63 Phil. 629, 639), "it is sufficient to
prove that the property was acquired during the marriage in
order that the same may be deemed conjugal property." And
in Laluan v. Malpaya (65 SCRA 494, 504) we stated, "proof of
acquisition of the property in dispute during the marriage
suffices to render the statutory presumption operative."
There is no question that the disputed property was acquired
by onerous title during the marriage. But were the funds
used to buy the lot and build the improvements at the
expense of the common fund?
The records show that the funds came from loans obtained
by the spouses from the Rehabilitation Finance Corporation.
Under Article 161 of the Civil Code, all debts and obligations
contracted by the husband and the wife for the benefit of
the conjugal partnership are liabilities of the partnership.
As stated in Castillo, Jr. vs. Pasco (1 1 SCRA 102, 107):
... The position thus taken by appellants is meritorous, for
the reason that the deeds show the loans to have been
made by Dr. Nicanor Jacinto and by Gabriel and
Purificacion Gonzales, to both spouses Marcelo Castillo
and Macaria Pasco, as joint borrowers. The loans thus
became obligations of the conjugal partnership of both
debtor spouses and the money loaned is logically conjugal
property.
Citing Palanca v. Smith Bell & Co. (9 Phil. 13 1) interpreting
Par. 3, Article 1401 of the old Civil Code, the Court inCastillo
v. Pasco stated:
If money borrowed by the husband alone on the security
of his wife's property is conjugal in character, a
fortiori should it be conjugal when borrowed by both
spouses. The reason obviously is that the loan becomes an
obligation of the conjugal partnership which is the one
primarily bound for its repayment.
To rebut the presumption and the evidence of the conjugal
character of the property, the petitioners have only the
testimony of Julia de Reyes to offer.
Mrs. Reyes testified that she bought the two parcels of land
on installment basis and that the first payment of a little less
than P2,000.00 came from her personal funds: The receipt
issued by Araneta, however, shows that the first installment
on one lot was only P69.96 and on the other lot, P102.00.
Mrs. Reyes also testified that she paid the entire purchase
price and the construction of the buildings from her personal
funds and money borrowed from the Philippine National
Bank. The mortgage contracts, however, show that the
properties were paid out of the loan from RFC.

Her claim of exclusive ownership is further belied by the


Income Tax Returns (Exhs. 'N' to 'N'- 3') which she herself
prepared and filed in behalf of the conjugal partnership
wherein she made the statement that the rentals paid by
her co-appellees were income of the conjugal partnership;
and by the Income Tax Returns (Exhs. 'O' to '0-4') also filed
by her for the conjugal partnership, were she made to
appear the properties in question as capital assets of the
conjugal partnership. It should be noted that Julia did not
care to deny the truth of said statements. Neither did she
endeavor to offer any explanation for such damaging
averments.
Petitioners also raised the issue of estoppel in their
assignments of errors. They alleged:
Even so, petitioners would have small legal cause to
dispute the respondent Court's giving credence to the
husband's pretensions did there not also exist in the
record plain and indisputable evidence that he had on a
former occasion both solemnly confirmed the paraphernal
character of the very properties now in question and
disclaimed the existence of any conjugal partnership
funds or properties of himself and his wife. (Petitioner's
Brief, L-31616, p. 7).
It turns out that in 1948, Ponciano Reyes was sued in the
then Municipal Court of Manila for ejectment from a leased
hotel that he was then operating. Judgment was rendered
against Reyes in favor of the lessors, the brothers named
Gocheco Having failed in a bid to garnish the rentals of the
disputed buildings because the municipal court stated that it
had no jurisdiction to decide the paraphernal or conjugal
nature of the properties, the Gocheco brothers filed Civil
Case No. 24772 for revival of judgment with the Court of
First Instance of Manila.
It was in this latter case where Mr. Reyes stated in his
special defenses that he and his wife never had any kind of
fund which could be called conjugal partnership funds, that
they acted independently from one another whenever either
one engaged in any business, andThat the herein plaintiff has not limited his action in the
present case against defendant Ponciano S. Reyes as he
did in the original case above-mentioned, that is, Civil
Case No. 7524 of the Manila Municipal Court which the
instant case derived from, but has included the
defendant's wife Julia Reyes, with the only intended
purpose and design of going over and against the
paraphernal properties of said Julia Reyes. (par. 4, Special
Defenses, Answer, Exh. II; Petitioner's Brief, L-31618, pp.
9-10).
Article 1437 of the Civil Code on estoppel involving
immovable property provides:

As a matter of fact, Mrs. Reyes' testimony about a loan from


Mrs. Rosa Borja, the sale of a lot in Cabiao, Nueva Ecija
given by her mother, and the loan from PNB only emphasize
the conjugal nature of the disputed properties because she
stated that these sums were also used to put up their gravel
and sand business, a poultry farm, and a banana plantation
plus a jeepney transportation line although according to her,
every business venture handled by her husband failed. The
two were establishing businesses and buying properties
together as husband and wife, in happier times.

Art. 1437. When in a contract between third persons


concerning immovable property, one of them is misled by
a person with respect to the ownership or real right over
the real estate, the latter is precluded from asserting his
legal title or interest therein, provided all these requisites
are present:

The Court of Appeals ruled upon the testimony of Julia De


Reyes as follows:

(2) The party precluded must intend that the other should
act upon the facts as misrepresented;

Julia's testimony that she had sold her Cabiao property to


Rosa Borja is not supported by the deed of sale (Exh. 'I')
which shows that the property was sold to Encarnacion
Goco and Mariano Robles. Again, her claim that said
Cabiao property was donated to her by her mother is
negated by the deeds of sale (Exhs. 'J' and 'K') which show
that said property was donated to her and her two
brothers, Pablo and Jose del Rosario, who afterwards sold
their participation thereof to the spouses, Ponciano and
Julia.

(1) There must be fraudulent representation or wrongful


concealment of facts known to the party estopped;

(3) The party misled must have been unaware of the true
facts; and
(4) The party defrauded must have acted in accordance
with the representation.
The principle of estoppel rests on the rule that whenever a
party has, by his declaration, act or omission, intentionally
and deliberately led the other to believe a particular thing
true and to act, upon such belief he cannot, in any litigation

arising out of such declaration, act or omission, be permitted


to falsify it. (Sotto v. Teves, 86 SCRA 154.)
Estoppel can only be invoked between the person making
the misrepresentation and the person to whom it was
addressed. It is essential that the latter shag have relied
upon the misrepresentation and had been influenced and
misled thereby.
There is no showing that the respondent had intentionally
and deliberately led the petitioners Mendozas to believe
what was contained in the pleading, "Exh. 11", and to make
them act upon it. As observed by the respondent, they were
not even a party in the case where the said pleadin was
filed. Neither is there any assertion by the Mendozas that
the said pleading was shown to them or that they happened
to see it or to have any knowledge about it before they
purchased the properties in question. The alleged
representation was never addressed to the petitioners, much
less made with the intention that they would act upon it.
Moreover, there is no specific and clear reference to the
disputed lots as paraphernal in the cited answer. The
petitioners cannot invoke estoppel in these petitions.
May the Mendoza spouses be considered buyers in good
faith?
The proof that the petitioners in L-31618 are purchasers in
good faith comes from the testimony of Mrs. Inocencia
Mendoza herself. Mrs. Mendoza testified that Mrs. Julia R. De
Reyes assured her that the properties were paraphernal that
her lawyer verified the titles being in the name of Mrs. Julia
R. De Reyes, and that she never dealt with Mr. Ponciano
Reyes when she and her husband were still renting the
properties they later purchased. On cross-examination, Mrs.
Mendoza admitted that she learned of the RFC mortgage
when the lots were about to be purchased.
Property acquired during a marriage is presumed to be
conjugal and the fact that the land is later registered in the
name of only one of the spouses does not destroy its
conjugal nature. (Bucoy v. Paulino, 23 SCRA 249). Section 46
of P.D. 1529, the Property Registration Decree, reiterates the
proviso in Section 70 of the former Land Registration Act
that registration cannot be construed to relieve registered
land or the owners thereof from any rights incident to the
relation of husband and wife. (See also: Marigsa v.
Macabuntoc 17 Phil. 107, 109; Romero de Pratts v. Menzi &
Co., Inc., 53 Phil. 51, 54; Padilla v. Padilla, 74 Phil. 377, 382384; Vitug v. Montemayor, 91 Phil. 286, 290, 291, citing
Guinguing v. Abuton, 48 Phil. 144; Sideco v. Aznar, 92 Phil.
952, 961-962, citing Flores v. Flores, 48 Phil. 288; Guinoo v.
Court of Appeals, 97 Phil. 235, 238; Silos v. Ramos, 97 Phil.
263, 270, citingCommonwealth v. Sandiko 72 Phil. 258, 260;
and Alvarez v. Espiritu, 14 SCRA 893).
If the fact that property acquired during marriage was
registered in the name of the husband alone does not affect
its conjugal nature, neither does registration in the name of
the wife. Any person who buys land registered in the married
name of the wife is put on notice about its conjugal nature.
The mortgage contracts (Exhs. "A-1 " and "B-1 ") executed
by the spouses Ponciano S. Reyes and Julia Reyes in favor of
RFC were duly registered in the Registry of Deeds of Quezon
City and seasonably annotated on transfer certificates of
title Nos. 8550 (Exh. "F") and 19998 (Exh. "G"), which were
issued in the name of Julia Reyes "married to Ponciano
Reyes". Their dates of inscription were November 29, 1948
and October 11, 1952, respectively. On December 10, 1952,
the lots and the building were leased by Julia, with the
marital consent of Ponciano to the petitioners Mendozas The
contract of lease was registered in the Registry of Deeds and
was annotated in the transfer certificates of title on May 5,
1952. At that time, the RFC mortgages were already noted
at the back of the transfer certificates of title. The
petitioners, therefore, are unquestionably charged with
notice of the existence and contents of said mortgages, their
joint execution by the spouses Ponciano Reyes and Julia
Reyes and the application of the loans to the payment to
Araneta of the purchase price of the lots in question.

Furthermore, the consent of the Ponciano Reyes to the mere


lease of the properties was demanded by the Mendozas
allegedly for their own protection, yet when it came to the
deed of sale which entailed a greater transfer of rights such
consent was not required.
The final argument refers to the alleged unjust enrichment
by Ponciano Reyes if the deed of sale is nullified This
petitioners admit that the benefit including that represented
by one-half of the purchase price, accrued not to the
respondent but to his wife. Since Mr. Reyes did not receive
any part of the proceeds of the sale and his wife has been
aligning herself with the Mendoza couple, there could be no
unjust enrichment as alleged. The assignments of errors
have no merit.
WHEREFORE, the petitions for review on certiorari are
hereby DENIED for lack of merit. The judgment of the Court
of Appeals is affirmed.
SO ORDERED.

[G.R. No. 74577 : December 4, 1990.]


192 SCRA 21
CONSOLACION VILLANUEVA, Petitioner, vs. THE
INTERMEDIATE APPELLATE COURT, JESUS BERNAS and
REMEDIOS Q. BERNAS, Respondents.
DECISION
NARVASA, J.:
The spouses Graciano Aranas and Nicolasa Bunsa were the
owners in fee simple of a parcel of land identified as Lot 13,
their ownership being evidenced by Original Certificate of
Title No. 0-3239 issued by the Register of Deeds of Capiz on
June 19, 1924. After they died, their surviving children,
Modesto Aranas and Federico Aranas, adjudicated the land
to themselves under a deed of extrajudicial partition
executed on May 2, 1952. The southern portion, described
as Lot 13-C, was thereby assigned to Modesto; the northern,
to Federico. 1
On March 21, 1953, Modesto Aranas obtained a Torrens title
in his name from the Capiz Registry of Property, numbered T1346. He died on April 20, 1973, at the age of 81 years. His
wife, Victoria Comorro, predeceased him dying at age 70 on
July 16, 1971. They had no children. 2
Now, it appears that Modesto was survived by two (2)
illegitimate children named Dorothea Aranas Ado and
Teodoro C. Aranas. These two borrowed P18,000.00 from
Jesus Bernas. As security therefor they mortgaged to Bernas
their father's property, Lot 13-C. In the "Loan Agreement
with Real Estate Mortgage" executed between them and
Bernas on October 30, 1975, they described themselves as
the absolute co-owners of Lot 13-C. A relative, Raymundo
Aranas, signed the agreement as a witness. 3
Dorothea and Teodoro failed to pay their loan. As a result,
Bernas caused the extrajudicial foreclosure of the mortgage
over Lot 13-C on June 29, 1977 and acquired the land at the
auction sale as the highest bidder. 4 After the foreclosure
sale, Dorothea and Teodoro executed a deed of Extrajudicial
Partition dated June 21, 1978, in which they adjudicated the
same Lot 13-C unto themselves in equal shares pro-indiviso.:
nad
On October 25, 1978 Bernas consolidated his ownership
over Lot 13-C, the mortgagors having failed to redeem the
same within the reglementary period, and had the latter's
title (No. T-1346 in the name of Modesto Aranas) cancelled
and another issued in his name, TCT No. T-15121. 5
About a month later, or on November 24, 1978, Consolacion
Villanueva and Raymundo Aranas who, as aforestated,
was an instrumental witness in the deed of mortgage
executed by Dorothea and Teodoro Aranas on October 30,
1975 filed a complaint with the Regional Trial Court at
Roxas City against Jesus Bernas and his spouse, Remedios
Bernas. The case was docketed as Civil Case No. V-4188,
and assigned to Branch 14. In their complaint, the plaintiffs
prayed that the latter's title over Lot 13-C, TCT No. T-15121,
be cancelled and they be declared co-owners of the land.
They grounded their cause of action upon their alleged
discovery on or about November 20, 1978 of two (2) wills,
one executed on February 11, 1958 by Modesto Aranas, and
the other, executed on October 29, 1957 by his wife, Victoria
Comorro. Victoria Comorro's will allegedly bequeathed to
Consolacion and Raymundo, and to Dorothea and Teodoro
Aranas, in equal shares pro indiviso, all of said Victoria

Comorro's "interests, rights and properties, real and personal


. . . as her net share from (the) conjugal partnership property
with her husband, Modesto Aranas . . ." Modesto Aranas' will,
on the other hand, bequeathed to Dorothea and Teodoro
Aranas (his illegitimate children) all his interests in his
conjugal partnership with Victoria "as well as his own capital
property brought by him to (his) marriage with his said wife."
6
At the pre-trial, the parties stipulated on certain facts,
including the following:
1) that the property in question was registered before the
mortgage in the name of the late Modesto Aranas, married
to Victoria Comorro, (covered by) TCT No. 1346, issued on
March 21, 1953;
2) that the wills above described were probated only after
the filing of the case (No. V-4188);
3) that Consolacion Villanueva and Raymundo Aranas are
not children of either Modesto Aranas or Victoria Comorro;
4) that the lot in question is not expressly mentioned in
the will; and
5) that TCT No. 15121 exists, and was issued in favor of
defendant spouses Jesus Bernas and Remedios Bernas.:cralaw
Trial ensued after which judgment was rendered adversely to
the plaintiffs, Consolacion Villanueva and Raymundo Aranas.
7 The dispositive part of the judgment reads as follows: 8
WHEREFORE, IN VIEW OF THE FOREGOING, judgment is
hereby rendered in favor of the defendants and against
the plaintiffs as follows:
The plaintiffs' complaint is hereby dismissed and ordering
the plaintiffs, jointly and severally, to pay the defendants
the following:
1) THREE THOUSAND FIVE HUNDRED PESOS (P3,500.00) as
attorney's fees;
2) FIVE HUNDRED PESOS (P500.00) as actual damages;
3) TEN THOUSAND PESOS (P10,000.00) as moral damages;
4) Declaring the defendants spouses Jesus Bernas and
Remedios O. Bernas as legal owners of Lot No. 13-C and
including all the improvements thereon;
5) Declaring the loan agreement with real estate mortgage
(Exh. '2') entered into by Dorothea Aranas Ado married to
Reynaldo F. Ado and Teodoro C. Aranas and Jesus Bernas
married to Remedios O. Bernas, over the lot in question
executed on October 30, 1975 before Notary Public Roland
D. Abalajon and the corresponding Certificate of Title No.
T-15121 registered in the name of Jesus Bernas
(defendants spouses) as having been executed and issued
in accordance with law, are declared legal and valid;
6) For failure to prove all other counter-claim and damages,
the same are hereby dismissed.
7) To pay costs of this suit.
SO ORDERED."
The plaintiffs appealed to the Intermediate Appellate Court,
where they succeeded only in having the award of actual
and moral damages deleted, the judgment of the Regional
Trial Court having been otherwise affirmed in toto.
From this judgment of the Appellate Court, 9 Consolacion
Villanueva appealed to this Court. Her co-plaintiff,
Raymundo Aranas, did not.
The only question is, what right was acquired by Consolacion
Villanueva over Lot 13-C and the improvements thereon
standing by virtue of Victoria Camorro's last will and
testament giving to her all of said Victoria's "interests, rights
and properties, real and personal . . . as her net share from
(the) conjugal partnership property with her husband,
Modesto Aranas . . ." She is admittedly, not named an
heiress in Modesto Aranas' will.: nad
Certain it is that the land itself, Lot 13-C, was not "conjugal
partnership property" of Victoria Comorro and her husband,
Modesto Aranas. It was the latter's exclusive, private
property, which he had inherited from his parents
Graciano Aranas and Nicolasa Bunsa, the original owners of
the property registered solely in his name, under TCT T1346. Whether Modesto succeeded to the property prior or
subsequent to his marriage to Victoria Comorro the record
being unfortunately none too clear on the point is
inconsequential. The property should be regarded as his own
exclusively, as a matter of law. This is what Article 148 of the
Civil Code clearly decrees: that to be considered as "the
exclusive property of each spouse" is inter alia, "that which
is brought to the marriage as his or her own," or "that which
each acquires, during the marriage, by lucrative title." Thus,
even if it be assumed that Modesto's acquisition by
succession of Lot 13-C took place during his marriage to

Victoria Comorro, the lot would nonetheless be his "exclusive


property" because acquired by him, "during the marriage, by
lucrative title."
Moreover, Victoria Comorro died on July 16, 1971, about two
(2) years ahead of her husband, Modesto Aranas, exclusive
owner of Lot 13-C, who passed away on April 20, 1973.
Victoria never therefore inherited any part of Lot 13-C and
hence, had nothing of Lot 13-C to bequeath by will or
otherwise to Consolacion Villanueva or anybody else.
It would seem, however, that there are improvements
standing on Lot 13-C, and it is to these improvements that
Consolacion Villanueva's claims are directed. The question
then is, whether or not the improvements are conjugal
property, so that Victoria Comorro may be said to have
acquired a right over them by succession, as voluntary heir
of Victoria Comorro.
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 the husband or the wife,
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." 10 Proof,
therefore, is needful of the time of the making or
construction of the improvements and the source of the
funds used therefor, in order to determine the character of
the improvements as belonging to the conjugal partnership
or to one spouse separately. No such proof was presented or
proferred by Consolacion Villanueva or any one else. What is
certain is that the land on which the improvements stand
was the exclusive property of Modesto Aranas and that
where, as here, 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 it belongs
exclusively to said spouse. 11 It is not therefore possible to
declare the improvements to be conjugal in character.
Yet another consideration precludes relief to Consolacion
Villanueva and that is, that when Lot 13-C was mortgaged to
Jesus Bernas, the title was free of any lien, encumbrance or
adverse claim presented by or for Consolacion Villanueva or
anybody else, and that when Bernas subsequently
consolidated his ownership over Lot 13-C and obtained title
in his name, the Registry of Deeds contained no record of
any lien, encumbrance or adverse claim affecting the
property. Furthermore, Bernas' mode of acquisition of
ownership over the property, i.e., by a mortgage sale,
appears in all respects to be regular, untainted by any defect
whatsoever. Bernas must therefore be deemed to have
acquired indefeasible and clear title to Lot 13-C 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.:-cralaw
Finally, it bears stressing that the conclusion of the
Intermediate Appellate Court that the evidence establishes
that the property in question was the exclusive property of
one spouse, not conjugal, is a factual one which, absent any
satisfactory showing of palpable error or grave abuse of
discretion on the part of the Appellate Court in reaching it, is
not reviewable by this Court.
WHEREFORE, the judgment of the Intermediate Appellate
Court subject of this appeal, being in accord with the
evidence and applicable law and jurisprudence, is AFFIRMED,
with costs against the petitioner.
SO ORDERED.

G.R. No. L-16857

May 29, 1964

MARCELO CASTILLO, JR., FELICISIMO CASTILLO,


ENCARNACION CASTILLO, AMELIA CASTILLO, JAIME
CASTILLO, RONALDO CASTILLO, VICTORIA CASTILLO,
LETICIA CINCO, LEVI CINCO and DANIEL
CINCO,petitioners,
vs.
MACARIA PASCO, respondent.
Tomas Yumol for petitioners.
Mariano G. Bustos and Associates for respondent.
REYES, J.B.L., J.:
The legitimate children and descendants of the late Marcelo
Castillo, Sr. pray for the review and reversal of the decision
of the Court of Appeals, in its Case CA G.R. No. 19377-R, that
affirmed the decision of the Court of First Instance of
Bulacan, declaring that the fishpond in San Roque,
Paombong, Bulacan (covered by TCT No. 9928 of the
Registry of Deeds of said province), was the exclusive
paraphernal property of respondent Macaria Pasco, surviving
spouse of the deceased Marcelo Castillo, Sr., and dismissing
the complaint for partition and accounting filed by
petitioners in said Court of First Instance.
The Court of Appeals found, and the petitioner-appellants do
not dispute, that in October 1931 Marcelo Castillo, Sr., being
a widower, married Macaria Pasco, a widow who had
survived two previous husbands. Petitioners were children
and grandchildren (representing their deceased parents) of
Marcelo Castillo, Sr. by his previous marriage. On April 3,
1933, Marcelo Castillo, Sr. died, and his widow married her
fourth husband, Luis San Juan, on June 8, 1934.
On December 22, 1932, Gabriel and Purificacion Gonzales,
as co-owners of the litigated fishpond, executed a deed of
sale (Exh. 1) conveying said property to the spouses Marcelo
Castillo and Macaria Pasco for the sum of P6,000.00
(although the deed recited a higher amount), payable in
three installments: P1,000 upon execution of the deed (Exh.
1) ; P2,000 on January 25, 1933 without interest; and P3,000
within one year thereafter, with 11% interest from February
1, 1933, but extendible for another year.
Against the contention of petitioners-appellants that the
fishpond thus bought should be considered conjugal for its
having been acquired during coverture, the Court of Appeals
declared it to be paraphernalia because it was purchased
with exclusive funds of the wife, Macaria Pasco. She was
admittedly a woman of means even before she married
Marcelo Castillo, Sr. and the latter's principal source of
income was only his P80 a month salary, as provincial
treasurer (as found by the Court of First Instance), besides
two small residential lots and fishponds, which were
encumbered and later transferred to his five children by his
first wife and whom he was then supporting in medical and
high school. Actually, Marcelo Castillo, Sr. died without
enough assets to pay his debts. .
In point of fact, the Court of Appeals found that the initial
payment of P1,000 for the fishpond now in litigation was
made up of P600, that one of the vendors (Gabriel Gonzales)
owed to appellee Pasco, and P400 in cash, which the latter
paid out of the proceeds of the sale of one of her nipa lands.
The second installment of P2,000 appears to have been paid
with the proceeds of the loan from Dr. Nicanor Jacinto, to
whom the fishpond was mortgaged by both spouses. Dr.
Jacinto later assigned his interest to Dr. Antonio Pasco. The
last payment of P3,000 was derived from a loan secured by
a mortgage (Exh. 2) on 2 parcels of land assessed in the
name of Macaria Pasco, and one of which she had inherited
from a former husband, Justo S. Pascual, while the other lot
encumbered was assessed in her exclusive name.
It was also found by the Court of Appeals that upon the
death of Marcelo Castillo, Sr., the loan and mortgage in favor
of Dr. Jacinto (later assigned by him to Dr. Antonio Pasco)
was still outstanding. Unable to collect the loan, Dr. Pasco
foreclosed the mortgaged, and the encumbered fishpond

was sold to him; but the sale was subsequently annulled.


Later, on September 7, 1949, respondent Macaria Pasco
judicially consigned P12,300 on account of the mortgage
debt and its interest, and completed payment by a second
consignation of P752.43 made on April 24, 1950. As the
estate of Castillo had no assets adequate to pay off the
claims against it, the Court of Appeals concluded that the
amounts consigned belonged to the widow Macaria Pasco,
respondent herein.1wph1.t
It is not gain said that under the Spanish Civil Code of 1889,
that was the applicable law in 1932, the property acquired
for onerous consideration during the marriage was deemed
conjugal or separate property depending on the source of
the funds employed for its acquisition. Thus, Article 1396 of
said Code provided:
ART. 1396. The following is separate property spouse:
1. ...
2. ...
3. ...
4. That bought with money belonging exclusively to the
wife or to the husband.
On the other hand, Article 1401, prescribed that:
ART. 1401. To the conjugal property belong:
1. Property acquired for valuable consideration during the
marriage at the expense of the common fund, whether the
acquisition is made for the partnership or for one of the
spouses only.
The last clause in Article 1401 (par. 1) indicates that the
circumstance of the sale of the fishpond in question being
made by the original owners in favor of both spouses,
Marcelo Castillo, Sr. and Macaria Pasco, is indifferent for the
determination of whether the property should be deemed
paraphernal or conjugal. As remarked by Manresa in his
Commentaries to the Civil Code, Vol. IX (5th Ed), p. 549, "la
ley atiende no a la persona encuyo nombre o a favor del
cual se realize la compra, sino a la procedenciadel dinero."
As above-noted, the Court of Appeals determined that the
initial payment of P1,000 for the fishpond now disputed was
made out of private funds of Macaria Pasco. Appellants,
however, argue that since there is no express finding that
the P600 debt owed by Gabriel Gonzales came exclusively
from private funds of Pasco, they should be presumed
conjugal funds, in accordance with Article 1407 of the Civil
Code of 1889. The argument is untenable. Since the wife,
under Article 1418, can not bind the conjugal partnership
without the consent of the husband, her private transactions
are presumed to be for her own account, and not for the
account of the partnership. The finding of the Court of
Appeals is that Gabriel Gonzales owed this particular
indebtedness to Macaria Pasco alone, and in the absence of
proof that the husband authorized her to use community
funds therefor, the appellate Court's finding can not be
disturbed by us. Whether the evidence adverted to should
be credited is for the Court of Appeals to decide.
Appellants next assail the conclusion of the Court of Appeals
that the other two installments of the purchase price should
be, like the first one, deemed to have been paid with
exclusive funds of the wife because the money was raised
by loans guaranteed by mortgage on paraphernalia property
of the wife. The position thus taken by appellants is
meritorious, for the reason that the deeds show the loans to
have been made by Dr. Nicanor Jacinto, and by Gabriel and
Purificacion Gonzales, to both spouses Marcelo Castillo and
Macaria Pasco, as joint borrowers. The loans thus became
obligations of the conjugal partnership of both debtor
spouses, and the money loaned is logically conjugal
property. While the securing mortgage is on the wife's

paraphernalia the mortgage is a purely accessory obligation


that the lenders could, waive if they so chose, without
affecting the principal debt which was owned by the
conjugal partnership, and which the creditors could enforce
exclusively against the latter it they so desired.
In Palanca vs. Smith Bell & Co., 9 Phil. 131., this Court ruled
as follows (cas cit. at p. 133,) .
This P14,000, borrowed by said Emiliano Boncan upon the
credit of the property of his wife became conjugal property
(par. 3, Art. 1401, Civil Code) and when that same was
reinvented in the construction of a house, the house
became e conjugal property and was liable for the
payment of the debts of the husband (Art 1408, Civ.
Code).
If money borrowed by the husband alone on the security of
his wife's property is conjugal in character, a fortiorishould it
be conjugal when borrowed by both spouses. The reason
obviously is that the loan becomes an obligation of the
conjugal partnership which is the one primarily bound for its
repayment.
The case of Lim Queco vs. Cartagena, 71 Phil. 162, is clearly
distinguishable from the Palanca case in that in the Lim
Queco case the wife alone borrowed the money from "El
Ahorro Insular" although she guaranteed repayment with a
mortgage on her parapherna executed with her husband's
consent. Since the wife does not have the management or
representation of the conjugal partnership where the
husband is qualified therefor, the loan to her constituted a
transaction that did not involve the community, and the
creditor could seek repayment exclusively from her
properties. Logically, as this Court then held, the money
loaned to the wife, as well as the property acquired thereby,
should be deemed to be the wife's exclusive property.
The analogy between the case now before us and
the Palanca vs. Smith Bell case is undeniable, and the
Palanca ruling applies. We, therefore, find that the two
installments, totalling P5,000, of the price of the fishpond
were paid with conjugal funds, unlike the first installment of
P1,000 that was paid exclusively with money belonging to
the wife Macaria Pasco, appellee herein.
As the litigated fishpond was purchased partly with
paraphernal funds and partly with money of the conjugal
partnership, justice requires that the property be held to
belong to both patrimonies in common, in proportion to the
contributions of each to the total purchase price of P6,000.
An undivided one-sixth (1/6) should be deemed
paraphernalia and the remaining five-sixths (5/6) held
property of the conjugal partnership of spouses Marcelo
Castillo and Macaria Pasco (9 Manresa, Com. al Codigo Civil
[5th Ed.], p. 549).
Puesto que la ley atiende no a la persona en cuyo nombre
o a favor del cualse realize la compra sino a la
procedencia del dinero, considerando el hecho como una
verdadera substitution o conversion del dinero en otros
objetos, debemos deduce que cuando una finca por
ejemplo, se compra con dinero del marido y de la mujer, o
de la mujer y de la Sociedad, pertenece a aquellos de
quienes precede el precio y en la proporcion entregada
por cada cual. Si pues marido y mujer compran una casa
entregando el primero de su capital propio 10,000
pesetas, y la segunda 5,000, la casa pertenecera a losdos
conyuges pro indiviso, en la proportion de los terceras
partes al marido y una tercera a la mujer. (Manresa. op.
cit)
The payment by the widow, after her husband's death, of
the mortgage debt due to Dr. Pasco, the assignee of the
original mortgagee, Dr. Nicanor Jacinto, does not result in
increasing her share in the property in question but in
creating a lien in her favor over the undivided share of the
conjugal partnership, for the repayment of the amount she
has advanced, should it be ultimately shown that the money
thus delivered to the creditor was exclusively owned by her.

It follows from the foregoing that, as the fishpond was


undivided property of the widow and the conjugal
partnership with her late husband, the heirs of the latter,
appellants herein, were entitled to ask for partition thereof
and liquidation of its proceeds. The ultimate interest of each
party must be resolved after due hearing, taking into
account (a) the widow's one-sixth direct share; (b) her half of
the community property; (e) her successional rights to a part
of the husband's share pursuant to the governing law of
succession when the husband died; and (d) the widow's right
to reimbursement for any amounts advanced by her in
paying the mortgage debt as aforesaid. All these details
must be settled after proper trial.
WHEREFORE, the dismissal of the original complaint is
hereby revoked and set aside, and the records are ordered
remanded to the court of origin for further proceedings
conformable to this opinion.

G.R. No. L-4085

July 30, 1952

AGAPITO LORENZO, ET AL., petitioners,


vs.
FLORENCIO NICOLAS ET AL., respondents.
Engracio F. Clemena and Senon S. Ceniza for petitioners.
Bustos and De Guzman for respondents.
PADILLA, J.:
This is a petition for a writ of certiorari to review a judgment
of the Court of Appeals the dispositive part of which reads,
as follows:
IN VIEW HEREOF, the Court reverses the judgement
appealed from, with respects to Parcels Nos. 5 and 6,
declares the same to be paraphernal properties of the
deceased Magdalena Clemente; declares the sale (Exhibit
D) made by Magdalena Clemente in favor of the
Defendants-Appellants of said Parcel of Land No. 6, on
June 26, 1916, binding lawful and effective; orders the
partition by and among the plaintiffs and defendants of
Parcels of Land Nos. 2, 3 and 4, in the proportion of onehalf () for the Plaintiffs and the other half () for the
Defendants; dismisses the complaint, with respect to
Parcels of land Nos. 1, 5, 6 and 7, without special
pronouncement as to costs; orders the Defendants to pay
to the conjugal partnership one-half of the whole amount
paid to the Bureau of Lands, with legal interest thereon,
from the date of the filing of the complaint, after
deducting from said amount the initial payments made on
the said lots Nos. 5 and 6; and further orders the Plaintiffs
to pay to pay the Defendants the sum of P50.00,
representing of the attorneys' fees paid by said
Defendants in connection with parcel No. 2.
The facts of the case as found by the Court of Appeals are as
follows:
Prior to 1910, Magdalena Clemente was the surviving
widow of the deceased Gregorio Nicolas, Manuel Lorenzo,
former husband of the deceased Carlosa Santamaria, was
also at that time a widower. On January 16, 1910,
Magdalena Clemente and Manuel Lorenzo contracted
marriage. Manuel Lorenzo died on January 7, 1929, while
Magdalena died on January 31, 1934. During their
coverture, the two had no children. In his first marriage,
however, Manuel Lorenzo left, as heirs, the plaintiffs
Agapito and Marcela Lorenzo and Policarpio Lorenzo,
deceased, who had been succeeded by his children, the
plaintiffs Faustina, Federico, Guillermo and Manuel all
surnamed Lorenzo; while Magdalena Clemente, in her first
marriage, left as heirs, the deceased Gerardo Nicholas,
father of the defendants Florencio, Elena, Felix, Trinidad,
Cecilia and Basilisa, all surnamed Nicolas. . . . .
xxx

xxx

xxx

As to Parcel of land No. 6. This parcel of land which is


lot No. 72 of the Friars Land Subdivision in Guiguinto,
Bulacan, was purchased in her own name by Magdalena
Clemente, for her own exclusive benefit on October 17,
1908 (Exhibit 7), prior to her marriage with Manuel
Lorenzo. She had paid the sum of P169.16 on account of
the purchase price before her marriage with Lorenzo and,
according to the terms of the contract of the sale, the
balance of P833.32 was payable on installments, namely:
P25.32 on June 1, 1909, and the balance in annual
payment of P42.00 each, payable on the first day of June
of each year, plus interest of 4% per annum.
The receipts, evidencing the payments of these
installments (Exhibits I-A to I-M), presented by Plaintiffs
themselves, demonstrate that they were paid in her own
name. On August 21, 1928, the deed of final conveyance
was executed in the sole favor of Magdalena Clemente,
notwithstanding the fact that Manuel Lorenzo was then
alive. This parcel of land was registered under the Torrens
System, in the exclusive name of Magdalena Clemente.
The real estate tax receipts, covering this particular
parcel, are under the exclusive name of Magdalena
Clemente. The presumption of continuity of condition is
also in favor of Magdalena Clemente. The status of the
land from the time she acquired it and before her
marriage to Lorenzo, contained until it is otherwise
changed, for it is presumed that a thing once proved to
exist continues as long as is usual with things of that
nature. All the acts just mentioned are also acts of
ownership. And again, it is to be presumed that a person
is the owner of a property from exercising acts of
ownership over it [Sec. 69 (j) (dd), Rule 123; Heirs of
Junero vs. Lizares, 17 Phil., 112]. These are presumptions
which the plaintiffs should but failed to rebut. And Manuel
Lorenzo, indoubtedly recognizing that Magdalena
Clemente had the right of ownership over the land, did not
even as much as care to place the title to the land in the
name of the conjugal partnership, even after the payment
of the installments paid by Magdalena Clemente during
the marriage. However, the evidence is not clear as to the
source of the money with which the payment of the
installments was made, except the advanced payment,
which was admittedly paid from her own purse. "Any
useful expenditures made for the benefit of the separate
property of either one of the spouses by means of the
advances made by the partnership or by the industry of
the husband or wife, are partnership property." (Art. 1404,
Civil Code). The amount spent for the payments of
installments due during the marriage, or obligations
affecting the separate property of Magdalena Clemente, is
certainly a useful expenditures because it preserves her
right to the ownership of the land, and is, therefore, a
credit which belongs to the conjugal partnership, and
must be reimbursed to it by her. (9 Manresa, 606; 5
Sanchez Roman, 840.) In other words, while the ownership
of the land remains with Magdalena Clemente, the
conjugal partnership is entitled to the reimbursement of
paid installments. (Ona vs. Regala, 58 Phil. 881.)
The learned trial court sustained plaintiffs pretension on
the strength of Article 1407 of the Civil Code which
declares that "all the property of the spouses shall be
deemed partnership property, in the absence of proof that
it belongs exclusively to the husband or to the wife",
thereby establishing a presumption which may be
"overcome by the introduction of competent evidence to
the contrary" (Casino vs. Samaniego, 30 Phil., 135). We
hold that the evidence adduced to rebut this presumption,
is not only most competent but also convincing, as has
heretofore been discussed.
As to Parcel of land No. 5. This parcel was also
purchased by Magdalena Clemente from the Bureau of
Lands on October 17, 1908 (Exhibit E), for P967.16, of
which amount P116.84 had previously been paid by her,
before her marriage to Manuel Lorenzo. According to the
terms of the sale, the balance of P850.32 was payable by
installments: namely, P52.32 on June 1, 1909, and P42.00
annually on June 1, of each succeeding year. Payments on
account of the installments were made by her, the
receipts therefor were issued in her own name by the
Bureau of Lands (Exhibits I-A to I-M). On October 7, 1933
or 4 years after the death of Manuel Lorenzo, the final,

certificate of sale was executed by the Director of Lands in


her favor and in her name. By virtue thereof, Transfer
Certificate of Title No. 13269 was issued in the sole name
of Magdalena Clemente. The legal principles hereinabove
discussed apply with equal force to this parcel of land No.
5.
On October 12, 1932, parcel of land No. 6, together with
lots Nos. 226 and 216 of the Friars Lands Subdivision in
Guiguinto, were conveyed in absolute sale for valuable
consideration by Magdalena Clemente in favor of herein
Defendants (Exhibit J). The trial court considered the sale
as having been made in bad faith and consequently
annulled the same. In view of our conclusion, that parcels
Nos. 5 and 6 are paraphernal properties of Magdalena
Clemente, further discussion of this assignment of error
would be deemed unnecessary. However, we propose to
pass upon this point in order to settle, once and for all, the
validity of the sale which is precisely one of the basis of
Defendant's title to the lands under litigation. The sale
took place about 3 years after Manuel Lorenzo's death
on January 7, 1921 it was duly registered in the Registry of
Deeds of Bulacan, and the corresponding T.C.T. No. 17786
was issued in their favor, Aside from the presumption of
good faith, connection with this transaction (Art. 434, Civil
Code), there is no evidence at all showing that defendants
were aware of the flaw in the title of their immediate
transferor, Magdalena Clemente. At the time of the
purchase of this parcel of land, Defendants did not have
any notice of the claim or interest of the herein Plaintiffs
over the said property. The price was paid. During the
lifetime of Magdalena Clemente, Plaintiffs did not dispute
at all her exclusive right over said land, and it was only
two years after her death that they filed the claim against
the Defendants. Fraud in the transaction should be proven
clearly; it should not solely be predicated upon a mere
presumption arising from the relationship of the vendor
and the vendees. Defendants took possession of the land
completely relying upon the fact that it was the sole
property of Magdalena Clemente. Furthermore, every
purchaser of registered land should take and hold the
same free and clear from any and all prior claims, liens
and encumbrances, except those set forth in the decree of
registration and those expressly mentioned in the Land
Registration Act as having been preserved against it. (Sec.
39, Act No. 496; De Jesus vs. City of Manila, 29 Phil., 73;
Anderson & Co. vs. Garcia, 64 Phil., 506.) No such claim,
liens or encumbrances are set forth on the certificate of
title.
Plaintiffs tried to prove fraud by the presentation of Exhibit
1, the deed of sale in 1934, in favor of Martina Rodrigo of
the parcel of land No. 7. This deed does not in any way
prove fraud in the sale of parcels of land Nos. 1 and 6, for
this deed refers only to parcel No. 7, as to which, Plaintiffs'
complaint had been dismissed by the trial court. The
imputation of fraud is belied by the statement in Exhibit J
that lot No. 216 was sold to Martina Rodrigo for the
purpose only of defraying the expenses of the last illness
of Magdalena Clemente. The court below, by dismissing
the complaint as to parcel No. 7 covered by the deed of
sale, Exhibit J, impliedly recognized the validity of the said
deed of sale, Exhibit J.
It is, therefore, evident that the annullment of the deed of
sale, Exhibit J, by the court a quo, is an error. In view of
this conclusion, the query posed by Defendants, whether
in an action for partition, the question of the nullity of
Exhibit J. on the ground of fraud, can be drawn collaterally,
need not to be determined. The same thing may be said
with respect to the question of estoppel by laches raised
by the Defendants.
In support of the petition for review the petitioners claim
that:
(a) That the Honorable Court of Appeals in declaring
parcels of land Nos. 5 and 6 paraphernal properties of the
deceased Magdalena Clemente has committed an error of
law.
(b) That the Honorable Court of Appeals has committed an
error which amounts to serious abuse of discretion by

declaring that parcels of land Nos. 5 and 6 were acquired


by Magdalena Clemente before her marriage to Manuel
Lorenzo..
(c) That the Honorable Court of Appeals has committed an
error which amounts to a grave abuse of discretion by not
declaring the deed of sale Exhibit "J" null and void.
So the petitioners question only the correctness of the
judgment of the Court of Appeals as to parcels Nos. 5 and 6
held to be paraphernal properties of the late Magdalena
Clemente reversing the judgment of the Court of First
Instance of Bulacan which held that they were conjugal, The
third assignment of error involves a question of fact.
Upon the presumption that the parcels of land Nos. 5 and 6
continued to be the exclusive properties of Magdalena
Clemente until shown otherwise and because she had paid
the sum of P116.84 for parcel No. 5 and P169.16 for parcel
No. 6 before her marriage to the late Manuel Lorenzo, the
ancestor of the petitioners, from whom they claim the
deprive their rights to one-half of the parcels of land, the
Court of Appeals is of the opinion that they were paraphernal
properties of the late Magdalena Clemente. What she had
paid during coverture for said parcels of land was declared
conjugal and deemed useful expenditures for which the
conjugal partnership is entitled to reimbursement.
The two parcel of land in question were part of the Friar
Lands the alienation of which is provided for in Act No. 1120.
Section 11 of Act No, 1120 provides:
Should any person who is the actual and bona fide settler
upon and occupant of any portion of said land . . . desire
to purchase the land so occupied by him, he shall be
entitled to do so at the actual cost thereof to the
Government, and shall be allowed ten years from the date
of purchase within which to pay for the same in equal
annual installments, if he so desires, all deferred
payments to bear interest at the rate of four per centum
per annum.
Section 12 of the same Act partly provides:
. . . When the cost thereof shall have been thus
ascertained the Chief of the Bureau of Public Lands shall
give the said settler and occupant a certificate which shall
set forth in detail that the Government has agreed to sell
to such settler and occupant the amount of land so held
by him, at the prize so fixed, payable as provided in this
Act ... and that upon the payment of the final installment
together with all accrued interest the Government will
convey to such settler and occupant the said land so held
by him by proper instrument of conveyance, which shall
be issued and become effective in the manner provide in
section one hundred and twenty-two of the Land
Registration Act. . . . .
Section 16 thereof in part provides:
In the event of the death of a holder of a certificate the
issuance of which is provided for in section twelve hereof,
prior to the execution of a deed by the Government to any
purchaser, his window shall be entitled to received a deed
of the land stated in the certificate upon showing that she
has complied with the requirements of law for the
purchase of the same. In case a holder of a certificate dies
before the giving of the deed and does not leave a widow,
then the interest of the holder of the certificate shall
descend and deed shall issue to the persons who under
the laws of the Philippine Islands would have taken had
the title been perfected before the death of the holder of
the certificate, upon proof of the holders thus entitled of
compliance with all the requirements of the certificate. . . .
From these provision it is apparent that the pervading
legislative intent is to sell the friar lands acquired by the
Government to actual settlers and occupants of the same. In
case of death of a holder of a certificate which is only an
agreement to sell it is not the heirs but the widow who

succeeds in the parcels of land to be sold by the


Government. Only do the heirs succeed in the rights of the
deceased holder of a certificate if no widow survives him.
The fact that all receipts for installments paid even during
the lifetime of the late husband Manuel Lorenzo were issued
in the name of Magdalena Clemente and that the deed of
sale or conveyance of parcel No. 6 was made in her name in
spite of the fact that Manuel Lorenzo was still alive shows
that the two parcels of land belonged to Magdalena
Clemente. The petitioner, the heirs of the late Manuel
Lorenzo, are not entitled to one-half of the two parcels of
land. But the installments paid during coverture are deemed
conjugal, there being no evidence that they were paid out of
funds belonging exclusively to the late Magdalena Clemente.
Upon these grounds and reasons the judgment of the Court
of Appeals under review is affirmed, without cost.

G.R. No. L-57499 June 22, 1984


MERCEDES CALIMLIM- CANULLAS, petitioner,
vs.
HON. WILLELMO FORTUN, Judge, Court of First
instance of Pangasinan, Branch I, and CORAZON
DAGUINES, respondents.
Fernandez Law Offices for petitioner.
Francisco Pulido for respondents.

MELENCIO-HERRERA, J.:
Petition for Review on certiorari assailing the Decision, dated
October 6, 1980, and the Resolution on the Motion for
Reconsideration, dated November 27, 1980, of the then
Court of First Instance of Pangasinan, Branch I, in Civil Case
No. 15620 entitled "Corazon DAGUINES vs. MERCEDES
Calimlim-Canullas," upholding the sale of a parcel of land in
favor of DAGUINES but not of the conjugal house thereon'
The background facts may be summarized as follows:
Petitioner MERCEDES Calimlim-Canullas and FERNANDO
Canullas were married on December 19, 1962. They begot
five children. They lived in a small house on the residential
land in question with an area of approximately 891 square
meters, located at Bacabac, Bugallon, Pangasinan. After
FERNANDO's father died in 1965, FERNANDO inherited the
land.
In 1978, FERNANDO abandoned his family and was living
with private respondent Corazon DAGUINES. During the
pendency of this appeal, they were convicted of
concubinage in a judgment rendered on October 27, 1981 by
the then Court of First Instance of Pangasinan, Branch II,
which judgment has become final.
On April 15, 1980, FERNANDO sold the subject property with
the house thereon to DAGUINES for the sum of P2,000.00. In
the document of sale, FERNANDO described the house as
"also inherited by me from my deceased parents."
Unable to take possession of the lot and house, DAGUINES
initiated a complaint on June 19, 1980 for quieting of title
and damages against MERCEDES. The latter resisted and
claimed that the house in dispute where she and her
children were residing, including the coconut trees on the
land, were built and planted with conjugal funds and through
her industry; that the sale of the land together with the
house and improvements to DAGUINES was null and void
because they are conjugal properties and she had not given
her consent to the sale,
In its original judgment, respondent Court principally
declared DAGUINES "as the lawful owner of the land in
question as well as the one-half () of the house erected on
said land." Upon reconsideration prayed for by MERCEDES,
however, respondent Court resolved:
WHEREFORE, the dispositive portion of the Decision of this
Court, promulgated on October 6, 1980, is hereby
amended to read as follows:
(1) Declaring plaintiff as the true and lawful owner of the
land in question and the 10 coconut trees;
(2) Declaring as null and void the sale of the conjugal
house to plaintiff on April 15, 1980 (Exhibit A) including
the 3 coconut trees and other crops planted during the
conjugal relation between Fernando Canullas (vendor) and
his legitimate wife, herein defendant Mercedes CalimlimCanullas;
xxx xxx xxx

The issues posed for resolution are (1) whether or not the
construction of a conjugal house on the exclusive property of
the husband ipso facto gave the land the character of
conjugal property; and (2) whether or not the sale of the lot
together with the house and improvements thereon was
valid under the circumstances surrounding the transaction.
The determination of the first issue revolves around the
interpretation to be given to the second paragraph of Article
158 of the Civil Code, which reads:
xxx xxx xxx
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.
We hold that pursuant to the foregoing provision both the
land and the building belong to the conjugal partnership but
the conjugal partnership is indebted to the husband for the
value of the land. The spouse owning the lot becomes a
creditor of the conjugal partnership for the value of the
lot, 1 which value would be reimbursed at the liquidation of
the conjugal partnership. 2
In his commentary on the corresponding provision in the
Spanish Civil Code (Art. 1404), Manresa stated:
El articulo cambia la doctrine; los edificios construidos
durante el matrimonio en suelo propio de uno de los
conjuges son gananciales, abonandose el valor del suelo
al conj uge a quien pertenezca.
It is true that in the case of Maramba vs. Lozano, 3 relied
upon by respondent Judge, it was held that the land
belonging to one of the spouses, upon which the spouses
have built a house, becomes conjugal property only when
the conjugal partnership is liquidated and indemnity paid to
the owner of the land. We believe that the better rule is that
enunciated by Mr. Justice J.B.L. Reyes in Padilla vs.
Paterno, 3 SCRA 678, 691 (1961), where the following was
explained:
As to the above properties, their conversion from
paraphernal to conjugal assets should be deemed to
retroact to the time the conjugal buildings were first
constructed thereon or at the very latest, to the time
immediately before the death of Narciso A. Padilla that
ended the conjugal partnership. They can not be
considered to have become conjugal property only as of
the time their values were paid to the estate of the
widow Concepcion Paterno because by that time the
conjugal partnership no longer existed and it could not
acquire the ownership of said properties. The acquisition
by the partnership of these properties was, under the
1943 decision, subject to the suspensive condition that
their values would be reimbursed to the widow at the
liquidation of the conjugal partnership; once paid, the
effects of the fulfillment of the condition should be
deemed to retroact to the date the obligation was
constituted (Art. 1187, New Civil Code) ...
The foregoing premises considered, it follows that
FERNANDO could not have alienated the house and lot to
DAGUINES since MERCEDES had not given her consent to
said sale. 4
Anent the second issue, we find that the contract of sale was
null and void for being contrary to morals and public policy.
The sale was made by a husband in favor of a concubine
after he had abandoned his family and left the conjugal
home where his wife and children lived and from whence
they derived their support. That sale was subversive of the
stability of the family, a basic social institution which public
policy cherishes and protects. 5
Article 1409 of the Civil Code states inter alia that: contracts
whose cause, object, or purpose is contrary to law, morals,

good customs, public order, or public policy are void and


inexistent from the very beginning.
Article 1352 also provides that: "Contracts without cause, or
with unlawful cause, produce no effect whatsoever.The
cause is unlawful if it is contrary to law, morals, good
customs, public order, or public policy."
Additionally, the law emphatically prohibits the spouses from
selling property to each other subject to certain
exceptions. 6 Similarly, donations between spouses during
marriage are prohibited. 7 And this is so because if transfers
or con conveyances between spouses were allowed during
marriage, that would destroy the system of conjugal
partnership, a basic policy in civil law. It was also designed
to prevent the exercise of undue influence by one spouse
over the other, 8 as well as to protect the institution of
marriage, which is the cornerstone of family law. The
prohibitions apply to a couple living as husband and wife
without benefit of marriage, otherwise, "the condition of
those who incurred guilt would turn out to be better than
those in legal union." Those provisions are dictated by public
interest and their criterion must be imposed upon the wig of
the parties. That was the ruling in Buenaventura vs.
Bautista, also penned by Justice JBL Reyes (CA) 50 O.G.
3679, and cited in Matabuena vs. Cervantes. 9 We quote
hereunder the pertinent dissertation on this point:
We reach a different conclusion. While Art. 133 of the Civil
Code considers as void a donation between the spouses
during the marriage, policy considerations of the most
exigent character as wen as the dictates
of morality require that the same prohibition should apply
to a common-law relationship.
As announced in the outset of this opinion, a 1954 Court
of Appeals decision, Buenaventura vs. Bautista, 50 OG
3679, interpreting a similar provision of the old Civil Code
speaks unequivocally. If the policy of the law is, in the
language of the opinion of the then Justice J.B.L. Reyes of
that Court, 'to prohibit donations in favor of the other
consort and his descendants because of fear of undue
influence and improper pressure upon the donor, a
prejudice deeply rooted in our ancient law, ..., then there
is every reason to apply the same prohibitive policy to
persons living together as husband and wife without
benefit of nuptials. For it is not to be doubted that assent
to such irregular connection for thirty years bespeaks
greater influence of one party over the other, so that the
danger that the law seeks to avoid is correspondingly
increased'. Moreover, as pointed out by Ulpian (in his lib
32 ad Sabinum, fr. 1), "It would not be just that such
donations should subsist, lest the conditions of those
who incurred guilt should turn out to be better." So long as
marriage remains the cornerstone of our family law,
reason and morality alike demand that the disabilities
attached to marriage should likewise attach
to concubinage (Emphasis supplied),
WHEREFORE, the Decision of respondent Judge, dated
October 6, 1980, and his Resolution of November 27, 1980
on petitioner's Motion for Reconsideration, are hereby set
aside and the sale of the lot, house and improvements in
question, is hereby declared null and void. No costs.
SO ORDERED.

G.R. No. L-48889 May 11, 1989


DEVELOPMENT BANK OF THE PHILIPPINES
(DBP), petitioner,
vs.
THE HONORABLE MIDPAINTAO L. ADIL, Judge of the
Second Branch of the Court of First Instance of Iloilo
and SPOUSES PATRICIO CONFESOR and JOVITA
VILLAFUERTE, respondents.

GANCAYCO, J.:
The issue posed in this petition for review on certiorari is the
validity of a promissory note which was executed in
consideration of a previous promissory note the enforcement
of which had been barred by prescription.
On February 10, 1940 spouses Patricio Confesor and Jovita
Villafuerte obtained an agricultural loan from the Agricultural
and Industrial Bank (AIB), now the Development of the
Philippines (DBP), in the sum of P2,000.00, Philippine
Currency, as evidenced by a promissory note of said date
whereby they bound themselves jointly and severally to pay
the account in ten (10) equal yearly amortizations. As the
obligation remained outstanding and unpaid even after the
lapse of the aforesaid ten-year period, Confesor, who was by
then a member of the Congress of the Philippines, executed
a second promissory note on April 11, 1961 expressly
acknowledging said loan and promising to pay the same on
or before June 15, 1961. The new promissory note reads as
follows
I hereby promise to pay the amount covered by my
promissory note on or before June 15, 1961. Upon my
failure to do so, I hereby agree to the foreclosure of my
mortgage. It is understood that if I can secure a certificate
of indebtedness from the government of my back pay I
will be allowed to pay the amount out of it.
Said spouses not having paid the obligation on the specified
date, the DBP filed a complaint dated September 11, 1970 in
the City Court of Iloilo City against the spouses for the
payment of the loan.
After trial on the merits a decision was rendered by the
inferior court on December 27, 1976, the dispositive part of
which reads as follows:
WHEREFORE, premises considered, this Court renders
judgment, ordering the defendants Patricio Confesor and
Jovita Villafuerte Confesor to pay the plaintiff Development
Bank of the Philippines, jointly and severally, (a) the sum
of P5,760.96 plus additional daily interest of P l.04 from
September 17, 1970, the date Complaint was filed, until
said amount is paid; (b) the sum of P576.00 equivalent to
ten (10%) of the total claim by way of attorney's fees and
incidental expenses plus interest at the legal rate as of
September 17,1970, until fully paid; and (c) the costs of
the suit.
Defendants-spouses appealed therefrom to the Court of First
Instance of Iloilo wherein in due course a decision was
rendered on April 28, 1978 reversing the appealed decision
and dismissing the complaint and counter-claim with costs
against the plaintiff.
A motion for reconsideration of said decision filed by plaintiff
was denied in an order of August 10, 1978. Hence this
petition wherein petitioner alleges that the decision of
respondent judge is contrary to law and runs counter to
decisions of this Court when respondent judge (a) refused to
recognize the law that the right to prescription may be
renounced or waived; and (b) that in signing the second
promissory note respondent Patricio Confesor can bind the
conjugal partnership; or otherwise said respondent became
liable in his personal capacity. The petition is impressed with
merit. The right to prescription may be waived or renounced.
Article 1112 of Civil Code provides:

Art. 1112. Persons with capacity to alienate property may


renounce prescription already obtained, but not the right
to prescribe in the future.
Prescription is deemed to have been tacitly renounced
when the renunciation results from acts which imply the
abandonment of the right acquired.
There is no doubt that prescription has set in as to the first
promissory note of February 10, 1940. However, when
respondent Confesor executed the second promissory note
on April 11, 1961 whereby he promised to pay the amount
covered by the previous promissory note on or before June
15, 1961, and upon failure to do so, agreed to the
foreclosure of the mortgage, said respondent thereby
effectively and expressly renounced and waived his right to
the prescription of the action covering the first promissory
note.
This Court had ruled in a similar case that
... when a debt is already barred by prescription, it
cannot be enforced by the creditor. But a new contract
recognizing and assuming the prescribed debt would be
valid and enforceable ... . 1
Thus, it has been held
Where, therefore, a party acknowledges the correctness
of a debt and promises to pay it after the same has
prescribed and with full knowledge of the prescription
he thereby waives the benefit of prescription. 2
This is not a mere case of acknowledgment of a debt that
has prescribed but a new promise to pay the debt. The
consideration of the new promissory note is the pre-existing
obligation under the first promissory note. The statutory
limitation bars the remedy but does not discharge the debt.
A new express promise to pay a debt barred ... will take
the case from the operation of the statute of limitations as
this proceeds upon the ground that as a statutory
limitation merely bars the remedy and does not discharge
the debt, there is something more than a mere moral
obligation to support a promise, to wit a pre-existing
debt which is a sufficient consideration for the new the
new promise; upon this sufficient consideration
constitutes, in fact, a new cause of action. 3
... It is this new promise, either made in express terms or
deduced from an acknowledgement as a legal implication,
which is to be regarded as reanimating the old promise, or
as imparting vitality to the remedy (which by lapse of time
had become extinct) and thus enabling the creditor to
recover upon his original contract. 4
However, the court a quo held that in signing the promissory
note alone, respondent Confesor cannot thereby bind his
wife, respondent Jovita Villafuerte, citing Article 166 of the
New Civil Code which provides:
Art. 166. Unless the wife has been declared a non
compos mentis or a spend thrift, or is under civil
interdiction or is confined in a leprosarium, the husband
cannot alienate or encumber any real property of the
conjugal partnership without, the wife's consent. If she ay
compel her to refuses unreasonably to give her consent,
the court m grant the same.
We disagree. Under Article 165 of the Civil Code, the
husband is the administrator of the conjugal partnership. As
such administrator, all debts and obligations contracted by
the husband for the benefit of the conjugal partnership, are
chargeable to the conjugal partnership. 5 No doubt, in this
case, respondent Confesor signed the second promissory
note for the benefit of the conjugal partnership. Hence the
conjugal partnership is liable for this obligation.

WHEREFORE, the decision subject of the petition is reversed


and set aside and another decision is hereby rendered
reinstating the decision of the City Court of Iloilo City of
December 27, 1976, without pronouncement as to costs in
this instance. This decision is immediately executory and no
motion for extension of time to file motion for
reconsideration shall be granted.
SO ORDERED.

G.R. No. L-25659

October 31, 1969

LUZON SURETY CO., INC., petitioner,


vs.
JOSEFA AGUIRRE DE GARCIA, VICENTE GARCIA and the
FOURTH DIVISION OF THE COURT OF
APPEALS, respondents.
Tolentino and Garcia and D. R. Cruz for petitioner.
Rodolfo J. Herman for respondents.
FERNANDO, J.:
The crucial question in this petition for the review of a
decision of the Court of Appeals, to be passed upon for the
first time, is whether or not a conjugal partnership, in the
absence of any showing of benefits received, could be held
liable on an indemnity agreement executed by the husband
to accommodate a third party in favor of a surety company.
The Court of Appeals held that it could not. Petitioner Luzon
Surety Co., Inc., dissatisfied with such a judgment, which
was an affirmance of a lower court decision, would have us
reverse. We do not see it that way. The Court of Appeals
adjudicated the matter in accordance with law. We affirm
what it did.
As noted in the brief of petitioner Luzon Surety Co., Inc., on
October 18, 1960, a suit for injunction was filed in the Court
of First Instance of Negros Occidental against its Provincial
Sheriff by respondents-spouses, Josefa Aguirre de Garcia and
Vicente Garcia "to enjoin [such Sheriff] from selling the
sugar allegedly owned by their conjugal partnership,
pursuant to a writ of garnishment issued by virtue of a writ
of execution issued in Civil Case No. 3893 of the same Court
of First Instance ... against the respondent Vicente
Garcia ... ."1
There was a stipulation of facts submitted. There is no
question as to one Ladislao Chavez, as principal, and
petitioner Luzon Surety Co., Inc., executing a surety bond in
favor of the Philippine National Bank, Victorias Branch, to
guaranty a crop loan granted by the latter to Ladislao
Chavez in the sum of P9,000.00. On or about the same date,
Vicente Garcia, together with the said Ladislao Chavez and
one Ramon B. Lacson, as guarantors, signed an indemnity
agreement wherein they bound themselves, jointly and
severally, to indemnify now petitioner Luzon Surety Co., Inc.
against any and all damages, losses, costs, stamps, taxes,
penalties, charges and expenses of whatsoever kind and
nature which the petitioner may at any time sustain or incur
in consequence of having become guarantor upon said
bond, to pay interest at the rate of 12% per annum,
computed and compounded quarterly until fully paid; and to
pay 15% of the amount involved in any litigation or other
matters growing out of or connected therewith for attorney's
fees.
It was likewise stipulated that on or about April 27, 1956, the
Philippine National Bank filed a complaint before the Court of
First Instance of Negros Occidental, docketed as its Civil
Case No. 3893, against Ladislao Chavez and Luzon Surety
Co., Inc. to recover the amount of P4,577.95, in interest,
attorney's fees, and costs of the suit. On or about August 8,
1957, in turn, a third-party complaint against Ladislao
Chavez, Ramon B. Lacson and Vicente Garcia, based on the
indemnity agreement, was instituted by Luzon Surety Co.,
Inc.

Then, as set forth by the parties, on September 17, 1958,


the lower court rendered a decision condemning Ladislao
Chavez and Luzon Surety Co., Inc., to pay the plaintiff jointly
and severally the amount of P4,577.95 representing the
principal and accrued interest of the obligation at the rate of
6% per annum as of January 6, 1956, with a daily interest of
P0.7119 on P4,330.91 from January 6, 1956, until fully paid,
plus the sum of P100.00 as attorney's fees, and to pay the
costs. The same decision likewise ordered the third party
defendants, Ladislao Chavez, Vicente Garcia, and Ramon B.
Lacson, to pay Luzon Surety Co., Inc., the total amount to be
paid by it to the plaintiff Philippine National Bank.
On July 30, 1960, pursuant to the aforesaid decision, the
Court of First Instance of Negros Occidental issued a writ of
execution against Vicente Garcia for the satisfaction of the
claim of petitioner in the sum of P8,839.97. Thereafter, a
writ of garnishment was issued by the Provincial Sheriff of
Negros Occidental dated August 9, 1960, levying and
garnishing the sugar quedans of the now respondentspouses, the Garcias, from their sugar plantation, registered
in the names of both of them.2 The suit for injunction filed by
the Garcia spouses was the result.
As noted, the lower court found in their favor. In its decision
of April 30, 1962, it declared that the garnishment in
question was contrary to Article 161 of the Civil Code and
granted their petition, making the writ of preliminary
injunction permanent. Luzon Surety, Inc. elevated the matter
to the Court of Appeals, which, as mentioned at the outset,
likewise reached the same result. Hence this petition for
review.
We reiterate what was set forth at the opening of this
opinion. There is no reason for a reversal of the judgment.
The decision sought to be reviewed is in accordance with
law.
As explained in the decision now under review: "It is true
that the husband is the administrator of the conjugal
property pursuant to the provisions of Art. 163 of the New
Civil Code. However, as such administrator the only
obligations incurred by the husband that are chargeable
against the conjugal property are those incurred in the
legitimate pursuit of his career, profession or business with
the honest belief that he is doing right for the benefit of the
family. This is not true in the case at bar for we believe that
the husband in acting as guarantor or surety for another in
an indemnity agreement as that involved in this case did not
act for the benefit of the conjugal partnership. Such
inference is more emphatic in this case, when no proof is
presented that Vicente Garcia in acting as surety or
guarantor received consideration therefor, which may
redound to the benefit of the conjugal partnership."3
In the decision before us, the principal error assigned is the
above holding of the Court of Appeals that under Article 161
of the Civil Code no liability was incurred by the conjugal
partnership. While fully conscious of the express language of
Article 161 of the Civil Code, petitioner, in its well-written
brief submitted by its counsel, would impress on us that in
this case it could not be said that no benefit was received by
the conjugal partnership. It sought to lend some semblance
of plausibility to this view thus: "The present case involves a
contract of suretyship entered into by the husband, the
respondent Vicente Garcia, in behalf of a third person. A
transaction based on credit through which, by our given
definitions, respondent Vicente Garcia, by acting as
guarantor and making good his guaranty, acquires the
capacity of being trusted, adds to his reputation or esteem,
enhances his standing as a citizen in the community in
which he lives, and earns the confidence of the business
community. He can thus secure money with which to carry
on the purposes of their conjugal partnership."4
While not entirely, without basis, such an argument does not
carry conviction. Its acceptance would negate the plain
meaning of what is expressly provided for in Article 161. In
the most categorical language, a conjugal partnership under
that provision is liable only for such "debts and obligations
contracted by the husband for the benefit of the conjugal
partnership." There must be the requisite showing then of
some advantage which clearly accrued to the welfare of the

spouses. There is none in this case. Nor could there be,


considering that the benefit was clearly intended for a third
party, one Ladislao Chavez. While the husband by thus
signing the indemnity agreement may be said to have added
to his reputation or esteem and to have earned the
confidence of the business community, such benefit, even if
hypothetically accepted, is too remote and fanciful to come
within the express terms of the provision.
Its language is clear; it does not admit of doubt. No process
of interpretation or construction need be resorted to. It
peremptorily calls for application. Where a requirement is
made in explicit and unambiguous terms, no discretion is left
to the judiciary. It must see to it that its mandate is obeyed.
So it is in this case. That is how the Court of Appeals acted,
and what it did cannot be impugned for being contrary to
law.5
Moreover, it would negate the plain object of the additional
requirement in the present Civil Code that a debt contracted
by the husband to bind a conjugal partnership must redound
to its benefit. That is still another provision indicative of the
solicitude and tender regard that the law manifests for the
family as a unit. Its interest is paramount; its welfare
uppermost in the minds of the codifiers and legislators.
This particular codal provision in question rightfully
emphasizes the responsibility of the husband as
administrator.6 He is supposed to conserve and, if possible,
augment the funds of the conjugal partnership, not dissipate
them. If out of friendship or misplaced generosity on his part
the conjugal partnership would be saddled with financial
burden, then the family stands to suffer. No objection need
arise if the obligation thus contracted by him could be shown
to be for the benefit of the wife and the progeny if any there
be. That is but fair and just. Certainly, however, to make a
conjugal partnership respond for a liability that should
appertain to the husband alone is to defeat and frustrate the
avowed objective of the new Civil Code to show the utmost
concern for the solidarity and well-being of the family as a
unit.7 The husband, therefore, as is wisely thus made
certain, is denied the power to assume unnecessary and
unwarranted risks to the financial stability of the conjugal
partnership.
No useful purpose would be served by petitioner assigning
as one of the errors the observation made by the Court of
Appeals as to the husband's interest in the conjugal property
being merely inchoate or a mere expectancy in view of the
conclusion thus reached as to the absence of any liability on
the part of the conjugal partnership. Nor was it error for the
Court of Appeals to refuse to consider a question raised for
the first time on appeal. Now as to the question of
jurisdiction of the lower court to entertain this petition for
injunction against the Provincial Sheriff, to which our
attention is invited, neither the Court of Appeals nor the
lower court having been asked to pass upon it. Of course, if
raised earlier, it ought to have been seriously inquired into.
We feel, however, that under all the circumstances of the
case, substantial justice would be served if petitioner be
held as precluded from now attempting to interpose such a
barrier. The conclusion that thereby laches had intervened is
not unreasonable. Such a response on our part can be
predicated on the authoritative holding in Tijam v.
Sibonghanoy.8
WHEREFORE, the decision of the Court of Appeals of
December 17, 1965, now under review, is affirmed with
costs against petitioner Luzon Surety Co., Inc.

G.R. No. 118305 February 12, 1998


AYALA INVESTMENT & DEVELOPMENT CORP. and
ABELARDO MAGSAJO, petitioners,
vs.
COURT OF APPEALS and SPOUSES ALFREDO &
ENCARNACION CHING, respondents.

MARTINEZ, J.:
Under Article 161 of the Civil Code, what debts and
obligations contracted by the husband alone are considered
"for the benefit of the conjugal partnership" which are
chargeable against the conjugal partnership? Is a surety
agreement or an accommodation contract entered into by
the husband in favor of his employer within the
contemplation of the said provision?
These are the issues which we will resolve in this petition for
review.
The petitioner assails the decision dated April 14, 1994 of
the respondent Court of Appeals in "Spouses Alfredo and
Encarnacion Ching vs. Ayala Investment and Development
Corporation, et. al.," docketed as CA-G.R. CV No.
29632, 1 upholding the decision of the Regional Trial Court of
Pasig, Branch 168, which ruled that the conjugal partnership
of gains of respondents-spouses Alfredo and Encarnacion
Ching is not liable for the payment of the debts secured by
respondent-husband Alfredo Ching.
A chronology of the essential antecedent facts is necessary
for a clear understanding of the case at bar.
Philippine Blooming Mills (hereinafter referred to as PBM)
obtained a P50,300,000.00 loan from petitioner Ayala
Investment and Development Corporation (hereinafter
referred to as AIDC). As added security for the credit line
extended to PBM, respondent Alfredo Ching, Executive Vice
President of PBM, executed security agreements on
December 10, 1980 and on March 20, 1981 making himself
jointly and severally answerable with PBM's indebtedness to
AIDC.
PBM failed to pay the loan. Thus, on July 30, 1981, AIDC filed
a case for sum of money against PBM and respondenthusband Alfredo Ching with the then Court of First Instance
of Rizal (Pasig), Branch VIII, entitled "Ayala Investment and
Development Corporation vs. Philippine Blooming Mills and
Alfredo Ching," docketed as Civil Case No. 42228.
After trial, the court rendered judgment ordering PBM and
respondent-husband Alfredo Ching to jointly and severally
pay AIDC the principal amount of P50,300,000.00 with
interests.
Pending appeal of the judgment in Civil Case No. 42228,
upon motion of AIDC, the lower court issued a writ of
execution pending appeal. Upon AIDC's putting up of an
P8,000,000.00 bond, a writ of execution dated May 12, 1982
was issued. Thereafter, petitioner Abelardo Magsajo, Sr.,
Deputy Sheriff of Rizal and appointed sheriff in Civil Case No.
42228, caused the issuance and service upon respondentsspouses of a notice of sheriff sale dated May 20, 1982 on
three (3) of their conjugal properties. Petitioner Magsajo
then scheduled the auction sale of the properties levied.
On June 9, 1982, private respondents filed a case of
injunction against petitioners with the then Court of First
Instance of Rizal (Pasig), Branch XIII, to enjoin the auction
sale alleging that petitioners cannot enforce the judgment
against the conjugal partnership levied on the ground that,
among others, the subject loan did not redound to the
benefit of the said conjugal partnership. 2 Upon application
of private respondents, the lower court issued a temporary
restraining order to prevent petitioner Magsajo from
proceeding with the enforcement of the writ of execution
and with the sale of the said properties at public auction.
AIDC filed a petition for certiorari before the Court of
Appeals, 3 questioning the order of the lower court enjoining
the sale. Respondent Court of Appeals issued a Temporary
Restraining Order on June 25, 1982, enjoining the lower
court 4 from enforcing its Order of June 14, 1982, thus paving
the way for the scheduled auction sale of respondentsspouses conjugal properties.
On June 25, 1982, the auction sale took place. AIDC being
the only bidder, was issued a Certificate of Sale by petitioner

Magsajo, which was registered on July 2, 1982. Upon


expiration of the redemption period, petitioner sheriff issued
the final deed of sale on August 4, 1982 which was
registered on August 9, 1983.
In the meantime, the respondent court, on August 4, 1982,
decided CA-G.R. SP No. 14404, in this manner:
WHEREFORE, the petition for certiorari in this case is
granted and the challenged order of the respondent Judge
dated June 14, 1982 in Civil Case No. 46309 is hereby set
aside and nullified. The same petition insofar as it seeks to
enjoin the respondent Judge from proceeding with Civil
Case No. 46309 is, however, denied. No pronouncement is
here made as to costs. . . . 5
On September 3, 1983, AIDC filed a motion to dismiss the
petition for injunction filed before Branch XIII of the CFI of
Rizal (Pasig) on the ground that the same had become moot
and academic with the consummation of the sale.
Respondents filed their opposition to the motion arguing,
among others, that where a third party who claim is
ownership of the property attached or levied upon, a
different legal situation is presented; and that in this case,
two (2) of the real properties are actually in the name of
Encarnacion Ching, a non-party to Civil Case No. 42228.
The lower court denied the motion to dismiss. Hence, trial on
the merits proceeded. Private respondents presented
several witnesses. On the other hand, petitioners did not
present any evidence.
On September 18, 1991, the trial court promulgated its
decision declaring the sale on execution null and void.
Petitioners appealed to the respondent court, which was
docketed as CA-G.R. CV No. 29632.
On April 14, 1994, the respondent court promulgated the
assailed decision, affirming the decision of the regional trial
court. It held that:
The loan procured from respondent-appellant AIDC was for
the advancement and benefit of Philippine Blooming Mills
and not for the benefit of the conjugal partnership of
petitioners-appellees.
xxx xxx xxx
As to the applicable law, whether it is Article 161 of the
New Civil Code or Article 1211 of the Family Code-suffice it
to say that the two provisions are substantially the same.
Nevertheless, We agree with the trial court that the Family
Code is the applicable law on the matter . . . . . . .
Article 121 of the Family Code provides that "The conjugal
partnership shall be liable for: . . . (2) All debts and
obligations contracted during the marriage by the
designated Administrator-Spouse for the benefit of the
conjugal partnership of gains . . . ." The burden of proof
that the debt was contracted for the benefit of the
conjugal partnership of gains, lies with the creditor-party
litigant claiming as such. In the case at bar, respondentappellant AIDC failed to prove that the debt was
contracted by appellee-husband, for the benefit of the
conjugal partnership of gains.

Specifically, the errors allegedly committed by the


respondent court are as follows:
I. RESPONDENT COURT ERRED IN RULING THAT THE
OBLIGATION INCURRED RESPONDENT HUSBAND DID NOT
REDOUND TO THE BENEFIT OF THE CONJUGAL
PARTNERSHIP OF THE PRIVATE RESPONDENT.
II. RESPONDENT COURT ERRED IN RULING THAT THE ACT
OF RESPONDENT HUSBAND IN SECURING THE SUBJECT
LOAN IS NOT PART OF HIS INDUSTRY, BUSINESS OR
CAREER FROM WHICH HE SUPPORTS HIS FAMILY.
Petitioners in their appeal point out that there is no need to
prove that actual benefit redounded to the benefit of the
partnership; all that is necessary, they say, is that the
transaction was entered into for the benefit of the conjugal
partnership. Thus, petitioners aver that:
The wordings of Article 161 of the Civil Code is very clear:
for the partnership to be held liable, the husband must
have contracted the debt "for the benefit of the
partnership, thus:
Art. 161. The conjugal partnership shall be liable for:
1) all debts and obligations contracted by the husband
for the benefit of the conjugal partnership . . . .
There is a difference between the phrases: "redounded to
the benefit of" or "benefited from" (on the one hand) and
"for the benefit of (on the other). The former require that
actual benefit must have been realized; the latter requires
only that the transaction should be one which normally
would produce benefit to the partnership, regardless of
whether or not actual benefit accrued. 8
We do not agree with petitioners that there is a difference
between the terms "redounded to the benefit of" or
"benefited from" on the one hand; and "for the benefit of" on
the other. They mean one and the same thing. Article 161
(1) of the Civil Code and Article 121 (2) of the Family Code
are similarly worded, i.e., both use the term "for the benefit
of." On the other hand, Article 122 of the Family Code
provides that "The payment of personal debts by the
husband or the wife before or during the marriage shall not
be charged to the conjugal partnership except insofar
as they redounded to the benefit of the family." As can be
seen, the terms are used interchangeably.
Petitioners further contend that the ruling of the respondent
court runs counter to the pronouncement of this Court in the
case of Cobb-Perez vs. Lantin, 9 that the husband as head of
the family and as administrator of the conjugal partnership
is presumed to have contracted obligations for the benefit of
the family or the conjugal partnership.
Contrary to the contention of the petitioners, the case of
Cobb-Perez is not applicable in the case at bar. This Court
has, on several instances, interpreted the term "for the
benefit of the conjugal partnership."
In the cases of Javier vs. Osmea, 10 Abella de Diaz
vs. Erlanger & Galinger, Inc., 11 Cobb-Perez
vs. Lantin 12 and G-Tractors, Inc. vs. Court of Appeals,
by the petitioners, we held that:

13

cited

The dispositive portion of the decision reads:

Petitioner filed a Motion for Reconsideration which was


denied by the respondent court in a Resolution dated
November 28, 1994. 7

The debts contracted by the husband during the marriage


relation, for and in the exercise of the industry or
profession by which he contributes toward the support of
his family, are not his personal and private debts, and the
products or income from the wife's own property, which,
like those of her husband's, are liable for the payment of
the marriage expenses, cannot be excepted from the
payment of such debts. (Javier)

Hence, this petition for review. Petitioner contends that the


"respondent court erred in ruling that the conjugal
partnership of private respondents is not liable for the
obligation by the respondent-husband."

The husband, as the manager of the partnership (Article


1412, Civil Code), has a right to embark the partnership in
an ordinary commercial enterprise for gain, and the fact
that the wife may not approve of a venture does not make

WHEREFORE, in view of all the foregoing, judgment is


hereby rendered DISMISSING the appeal. The decision of
the Regional Trial Court is AFFIRMED in toto. 6

it a private and personal one of the husband. (Abella de


Diaz)
Debts contracted by the husband for and in the exercise of
the industry or profession by which he contributes to the
support of the family, cannot be deemed to be his
exclusive and private debts. (Cobb-Perez).
. . . if he incurs an indebtedness in the legitimate pursuit
of his career or profession or suffers losses in a legitimate
business, the conjugal partnership must equally bear the
indebtedness and the losses, unless he deliberately acted
to the prejudice of his family. (G-Tractors)
However, in the cases of Ansaldo vs. Sheriff of Manila,
Fidelity Insurance & Luzon Insurance Co., 14 Liberty
Insurance Corporation vs. Banuelos, 15 and Luzon Surety
Inc. vs. De Garcia, 16 cited by the respondents, we ruled
that:
The fruits of the paraphernal property which form part of
the assets of the conjugal partnership, are subject to the
payment of the debts and expenses of the spouses, but
not to the payment of the personal obligations (guaranty
agreements) of the husband, unless it be proved that
such obligations were productive of some benefit to the
family." (Ansaldo; parenthetical phrase ours.)
When there is no showing that the execution of an
indemnity agreement by the husband redounded to the
benefit of his family, the undertaking is not a conjugal
debt but an obligation personal to him. (Liberty
Insurance)
In the most categorical language, a conjugal partnership
under Article 161 of the new Civil Code is liable only for
such "debts and obligations contracted by the husband
for the benefit of the conjugal partnership." There must
be the requisite showing then of some advantage which
clearly accrued to the welfare of the spouses. Certainly,
to make a conjugal partnership respond for a liability that
should appertain to the husband alone is to defeat and
frustrate the avowed objective of the new Civil Code to
show the utmost concern for the solidarity and well-being
of the family as a unit. The husband, therefore, is denied
the power to assume unnecessary and unwarranted risks
to the financial stability of the conjugal partnership.
(Luzon Surety, Inc.)
From the foregoing jurisprudential rulings of this Court, we
can derive the following conclusions:
(A) If the husband himself is the principal obligor in the
contract, i.e., he directly received the money and services to
be used in or for his own business or his own profession, that
contract falls within the term . . . . obligations for the benefit
of the conjugal partnership." Here, no actual benefit may be
proved. It is enough that the benefit to the family is
apparent at the time of the signing of the contract. From the
very nature of the contract of loan or services, the family
stands to benefit from the loan facility or services to be
rendered to the business or profession of the husband. It is
immaterial, if in the end, his business or profession fails or
does not succeed. Simply stated, where the husband
contracts obligations on behalf of the family business, the
law presumes, and rightly so, that such obligation will
redound to the benefit of the conjugal partnership.
(B) On the other hand, if the money or services are given to
another person or entity, and the husband acted only as
a surety or guarantor, that contract cannot, by itself, alone
be categorized as falling within the context of "obligations
for the benefit of the conjugal partnership." The contract of
loan or services is clearly for the benefit of the principal
debtor and not for the surety or his family. No presumption
can be inferred that, when a husband enters into a contract
of surety or accommodation agreement, it is "for the benefit
of the conjugal partnership." Proof must be presented to
establish benefit redounding to the conjugal partnership.
Thus, the distinction between the Cobb-Perez case, and we
add, that of the three other companion cases, on the one

hand, and that of Ansaldo, Liberty Insurance and Luzon


Surety, is that in the former, the husband contracted the
obligation for his own business; while in the latter, the
husband merely acted as a surety for the loan contracted by
another for the latter's business.
The evidence of petitioner indubitably show that corespondent Alfredo Ching signed as surety for the P50M loan
contracted on behalf of PBM. petitioner should have adduced
evidence to prove that Alfredo Ching's acting as surety
redounded to the benefit of the conjugal partnership. The
reason for this is as lucidly explained by the respondent
court:
The loan procured from respondent-appellant AIDC was for
the advancement and benefit of Philippine Blooming Mills
and not for the benefit of the conjugal partnership of
petitioners-appellees. Philippine Blooming Mills has a
personality distinct and separate from the family of
petitioners-appellees this despite the fact that the
members of the said family happened to be stockholders
of said corporate entity.
xxx xxx xxx
. . . . The burden of proof that the debt was contracted for
the benefit of the conjugal partnership of gains, lies with
the creditor-party litigant claiming as such. In the case at
bar, respondent-appellant AIDC failed to prove that the
debt was contracted by appellee-husband, for the benefit
of the conjugal partnership of gains. What is apparent
from the facts of the case is that the judgment debt was
contracted by or in the name of the Corporation Philippine
Blooming Mills and appellee-husband only signed as
surety thereof. The debt is clearly a corporate debt and
respondent-appellant's right of recourse against appelleehusband as surety is only to the extent of his corporate
stockholdings. It does not extend to the conjugal
partnership of gains of the family of petitionersappellees. . . . . . . 17
Petitioners contend that no actual benefit need accrue to the
conjugal partnership. To support this contention, they cite
Justice J.B.L. Reyes' authoritative opinion in the Luzon Surety
Company case:
I concur in the result, but would like to make of record
that, in my opinion, the words "all debts and obligations
contracted by the husband for the benefit of the conjugal
partnership" used in Article 161 of the Civil Code of the
Philippines in describing the charges and obligations for
which the conjugal partnership is liable do not require that
actual profit or benefit must accrue to the conjugal
partnership from the husband's transaction; but it suffices
that the transaction should be one that normally would
produce such benefit for the partnership. This is the ratio
behind our ruling in Javier vs. Osmea, 34 Phil. 336, that
obligations incurred by the husband in the practice of his
profession are collectible from the conjugal partnership.
The aforequoted concurring opinion agreed with the majority
decision that the conjugal partnership should not be made
liable for the surety agreement which was clearly for the
benefit of a third party. Such opinion merely registered an
exception to what may be construed as a sweeping
statement that in all cases actual profit or benefit must
accrue to the conjugal partnership. The opinion merely made
it clear that no actual benefits to the family need be proved
in some cases such as in the Javier case. There, the husband
was the principal obligor himself. Thus, said transaction was
found to be "one that would normally produce . . . benefit for
the partnership." In the later case of G-Tractors, Inc., the
husband was also the principal obligor not merely the
surety. This latter case, therefore, did not create any
precedent. It did not also supersede the Luzon Surety
Company case, nor any of the previous accommodation
contract cases, where this Court ruled that they were for the
benefit of third parties.
But it could be argued, as the petitioner suggests, that even
in such kind of contract of accommodation, a benefit for the

family may also result, when the guarantee is in favor of the


husband's employer.
In the case at bar, petitioner claims that the benefits the
respondent family would reasonably anticipate were the
following:
(a) The employment of co-respondent Alfredo Ching
would be prolonged and he would be entitled to his
monthly salary of P20,000.00 for an extended length of
time because of the loan he guaranteed;
(b) The shares of stock of the members of his family
would appreciate if the PBM could be rehabilitated
through the loan obtained;
(c) His prestige in the corporation would be enhanced
and his career would be boosted should PBM survive
because of the loan.
However, these are not the benefits contemplated by Article
161 of the Civil Code. The benefits must be one directly
resulting from the loan. It cannot merely be a by-product or
a spin-off of the loan itself.
In all our decisions involving accommodation contracts of
the husband, 18 we underscored the requirement that: "there
must be the requisite showing . . . of some advantage which
clearly accrued to the welfare of the spouses" or "benefits to
his family" or "that such obligations are productive of some
benefit to the family." Unfortunately, the petition did not
present any proof to show: (a) Whether or not the corporate
existence of PBM was prolonged and for how many months
or years; and/or (b) Whether or not the PBM was saved by
the loan and its shares of stock appreciated, if so, how much
and how substantial was the holdings of the Ching family.
Such benefits (prospects of longer employment and
probable increase in the value of stocks) might have been
already apparent or could be anticipated at the time the
accommodation agreement was entered into. But would
those "benefits" qualify the transaction as one of the
"obligations . . . for the benefit of the conjugal partnership"?
Are indirect and remote probable benefits, the ones referred
to in Article 161 of the Civil Code? The Court of Appeals in
denying the motion for reconsideration, disposed of these
questions in the following manner:
No matter how one looks at it, the debt/credit
respondents-appellants is purely a corporate debt granted
to PBM, with petitioner-appellee-husband merely signing
as surety. While such petitioner-appellee-husband, as such
surety, is solidarily liable with the principal debtor AIDC,
such liability under the Civil Code provisions is specifically
restricted by Article 122 (par. 1) of the Family Code, so
that debts for which the husband is liable may not be
charged against conjugal partnership properties. Article
122 of the Family Code is explicit "The payment of
personal debts contracted by the husband or the wife
before or during the marriage shall not be charged to the
conjugal partnership except insofar as they redounded to
the benefit of the family.
Respondents-appellants insist that the corporate debt in
question falls under the exception laid down in said Article
122 (par. one). We do not agree. The loan procured from
respondent-appellant AIDC was for the sole advancement
and benefit of Philippine Blooming Mills and not for the
benefit of the conjugal partnership of petitionersappellees.
. . . appellee-husband derives salaries, dividends benefits
from Philippine Blooming Mills (the debtor corporation),
only because said husband is an employee of said PBM.
These salaries and benefits, are not the "benefits"
contemplated by Articles 121 and 122 of the Family Code.
The "benefits" contemplated by the exception in Article
122 (Family Code) is that benefit derived directly from the
use of the loan. In the case at bar, the loan is a corporate
loan extended to PBM and used by PBM itself, not by
petitioner-appellee-husband or his family. The alleged

benefit, if any, continuously harped by respondentsappellants, are not only incidental but also speculative.

19

We agree with the respondent court. Indeed, considering the


odds involved in guaranteeing a large amount
(P50,000,000.00) of loan, the probable prolongation of
employment in PBM and increase in value of its stocks,
would be too small to qualify the transaction as one "for the
benefit" of the surety's family. Verily, no one could say, with
a degree of certainty, that the said contract is even
"productive of some benefits" to the conjugal partnership.
We likewise agree with the respondent court (and this view
is not contested by the petitioners) that the provisions of the
Family Code is applicable in this case. These provisions
highlight the underlying concern of the law for the
conservation of the conjugal partnership; for the husband's
duty to protect and safeguard, if not augment, not to
dissipate it.
This is the underlying reason why the Family Code clarifies
that the obligations entered into by one of the spouses must
be those that redounded to the benefit of the family and that
the measure of the partnership's liability is to "the extent
that the family is benefited." 20
These are all in keeping with the spirit and intent of the
other provisions of the Civil Code which prohibits any of the
spouses to donate or convey gratuitously any part of the
conjugal property. 21 Thus, when co-respondent Alfredo
Ching entered into a surety agreement he, from then on,
definitely put in peril the conjugal property (in this case,
including the family home) and placed it in danger of being
taken gratuitously as in cases of donation.
In the second assignment of error, the petitioner advances
the view that acting as surety is part of the business or
profession of the respondent-husband.
This theory is new as it is novel.
The respondent court correctly observed that:
Signing as a surety is certainly not an exercise of an
industry or profession, hence the cited cases ofCobbPerez vs. Lantin; Abella de Diaz vs. Erlanger &
Galinger; G-Tractors, Inc. vs. CA do not apply in the
instant case. Signing as a surety is not embarking in a
business. 22
We are likewise of the view that no matter how often an
executive acted or was persuaded to act, as a surety for his
own employer, this should not be taken to mean that he had
thereby embarked in the business of suretyship or guaranty.
This is not to say, however, that we are unaware that
executives are often asked to stand as surety for their
company's loan obligations. This is especially true if the
corporate officials have sufficient property of their own;
otherwise, their spouses' signatures are required in order to
bind the conjugal partnerships.
The fact that on several occasions the lending institutions
did not require the signature of the wife and the husband
signed alone does not mean that being a surety became part
of his profession. Neither could he be presumed to have
acted for the conjugal partnership.
Article 121, paragraph 3, of the Family Code is emphatic that
the payment of personal debts contracted by the husband or
the wife before or during the marriage shall not be charged
to the conjugal partnership except to the extent that they
redounded to the benefit of the family.
Here, the property in dispute also involves the family home.
The loan is a corporate loan not a personal one. Signing as a
surety is certainly not an exercise of an industry or
profession nor an act of administration for the benefit of the
family.

On the basis of the facts, the rules, the law and equity, the
assailed decision should be upheld as we now uphold it. This
is, of course, without prejudice to petitioner's right to
enforce the obligation in its favor against the PBM receiver in
accordance with the rehabilitation program and payment
schedule approved or to be approved by the Securities &
Exchange Commission.
WHEREFORE, the petition for review should be, as it is
hereby, DENIED for lack of merit.

b. Working day and night and almost beyond human


endurance, defendant devoted all his efforts and skill,
used all his business and personal connection to be able
to revive the construction business of plaintiff;
c. Little-by-little, starting with small construction
business, defendant was able to obtain various
construction jobs using the name H.L. CARLOS
CONSTRUCTION and the income derived therefrom were
deposited in the name of such firm of plaintiff,

SO ORDERED.

G.R. No. 146504

a. Defendant (respondent) xxx revived that otherwise


dormant construction firm H.L. CARLOS CONSTRUCTION
of herein plaintiff which suffered tremendous setback
after the assassination of Senator Benigno Aquino;

April 9, 2002

HONORIO L. CARLOS, petitioner,


vs.
MANUEL T. ABELARDO, respondent.
KAPUNAN, J.:
Assailed in this petition for review on certiorari under Rule
45 of the Rules of Court is the decision of the Court of
Appeals dated November 10, 2000 in CA-G.R. CV No. 54464
which reversed and set aside the decision of the Regional
Trial Court of Valenzuela, Branch 172, and dismissed for
insufficiency of evidence the complaint for a sum of money
and damages filed by herein petitioner Honorio Carlos
against respondent Manuel Abelardo, his son-in-law, and the
latters wife, Maria Theresa Carlos-Abelardo.
Petitioner averred in his complaint filed on October 13, 1994
that in October 1989, respondent and his wife Maria Theresa
Carlos-Abelardo approached him and requested him to
advance the amount of US$25,000.00 for the purchase of a
house and lot located at #19952 Chestnut Street, Executive
Heights Village, Paranaque, Metro Manila. To enable and
assist the spouses conduct their married life independently
and on their own, petitioner, in October 31, 1989, issued a
check in the name of a certain Pura Vallejo, seller of the
property, who acknowledged receipt thereof.1 The amount
was in full payment of the property.
When petitioner inquired from the spouses in July 1991 as to
the status of the amount he loaned to them, the latter
acknowledged their obligation but pleaded that they were
not yet in a position to make a definite settlement of the
same.2Thereafter, respondent expressed violent resistance
to petitioners inquiries on the amount to the extent of
making various death threats against petitioner. 3
On August 24, 1994, petitioner made a formal demand for
the payment of the amount of US$25,000.00 but the
spouses failed to comply with their obligation.4Thus, on
October 13, 1994, petitioner filed a complaint for collection
of a sum of money and damages against respondent and his
wife before the Regional Trial Court of Valenzuela, Branch
172, docketed as Civil Case No. 4490-V-94. In the complaint,
petitioner asked for the payment of the US$25,000.00 or
P625,000.00, its equivalent in Philippine currency plus legal
interest from date of extra-judicial demand.5Petitioner
likewise claimed moral and exemplary damages, attorneys
fees and costs of suit from respondent.6
As they were separated in fact for more than a year prior to
the filing of the complaint, respondent and his wife filed
separate answers. Maria Theresa Carlos-Abelardo admitted
securing a loan together with her husband, from
petitioner.7She claimed, however, that said loan was payable
on a staggered basis so she was surprised when petitioner
demanded immediate payment of the full amount. 8
In his separate Answer, respondent admitted receiving the
amount of US$25,000.00 but claimed that:
xxx

d. Defendant xxx was made to believe that the earnings


derived from such construction will be for him and his
family since he was the one working to secure the
contract and its completion, he was allowed to use the
facilities of the plaintiff;
e. The plaintiff seeing the progress brought about by
defendant xxx to his company proposed a profit sharing
scheme to the effect that all projects amounting to more
than P10 million shall be for the account of plaintiff;
lower amount shall be for defendants account but still
using H.L. CARLOS CONSTRUCTION.
f. But, to clear account on previous construction contracts
that brought income to H.L.CARLOS CONSTRUCTION, out
of which defendant derived his income, plaintiff gave the
amount of US$25,000.00 to defendant to square off
account and to start the arrangement in paragraph (e)
supra;
g. That, the said US$25,000.00 was never intended as
loan of defendant. It was his share of income on
contracts obtained by defendant;
xxx

Respondent denied having made death threats to petitioner


and by way of compulsory counterclaim, he asked for moral
damages from petitioner for causing the alienation of his
wifes love and affection, attorneys fees and costs of suit.10
On June 26, 1996, the Regional Trial Court rendered a
decision in favor of petitioner, the dispositive portion of
which reads:
WHEREFORE, judgment is hereby rendered as follows:
1. Ordering the defendants to pay plaintiff the amount of
US$25,000.00 or its equivalent in Philippine Currency at
the time of its payment, plus legal interest thereon from
August 24, 1994 until fully paid;
2. Ordering the defendant Manuel T. Abelardo to pay the
plaintiff the amount of P500,000.00 representing moral
damages and the further amount of P50,000.00 as
exemplary damages; and
3. Ordering the defendants to pay the plaintiff the amount
of P100,000.00 as attorneys fees, plus the costs of suit.
SO ORDERED.11
Respondent appealed the decision of the trial court to the
Court of Appeals. On November 10, 2000, the Court of
Appeals reversed and set aside the trial courts decision and
dismissed the complaint for insufficiency of evidence to
show that the subject amount was indeed loaned by
petitioner to respondent and his wife. The Court of Appeals
found that the amount of US$25,000.00 was respondents
share in the profits of H.L. Carlos Construction. The
dispositive portion of the Court of Appeals decision states:

WHEREFORE, premises considered, the Decision of


the Regional Trial Court of Valenzuela, Branch 172
in Civil Case No. 4490-V-94 is hereby REVERSED
and SET ASIDE and a new one entered DISMISSING
the Complaint for insufficiency of evidence.
The claim for damages by defendant-appellant is likewise
DISMISSED, also for insufficiency of evidence, because of
his failure to present substantial evidence to prove that
plaintiff-appellee caused the defendant-spouses
separation.
Costs against the plaintiff-appellee.
SO ORDERED.12
A motion for reconsideration of the above decision having
been denied on, petitioner brought this appeal assigning the
following errors:
THE COURT OF APPEALS ERRED IN FINDING INSUFFICIENT
EVIDENCE TO PROVE THAT THE AMOUNT OF US$25,000.00
WAS A LOAN OBTAINED BY PRIVATE RESPONDENT AND HIS
WIFE FROM PETITIONER.
THE COURT OF APPEALS ERRED IN HOLDING THAT THE
US$25,000.00 WAS GIVEN AS PRIVATE RESPONDENTS
SHARE IN THE PROFITS OF H.L. CARLOS CONSTRUCTION,
INC. AND THAT THE FILING OF THE COMPLAINT IS A HOAX.
THE COURT OF APPEALS ERRED IN NULLIFYING THE
AWARD OF DAMAGES FOR LACK OF PROOF THEREOF.
We find merit in the petition.
As gleaned from the records, the following facts are
undisputed: (1) there was a check in the amount of
US$25,000.00 issued by petitioner; (2) this amount was
received by respondent and his wife and given to a certain
Pura Vallejo for the full payment of a house and lot located
at #19952 Chestnut Street, Executive Heights Village,
Paranaque, Metro Manila; (3) this house and lot became the
conjugal dwelling of respondent and his wife; and (4)
respondents wife executed an instrument acknowledging
the loan but which respondent did not sign.
To prove his claim that the amount was in the nature of a
loan or an advance he extended to respondent and his wife,
petitioner presented Bankers Trust Check No. 337 in the
amount of US$25,000.00 he issued on October 31, 1989 to
Pura Vallejo.13 He also introduced in evidence an instrument
executed by respondents wife on July 31, 1991
acknowledging her and her husbands accountability to
petitioner for the said amount which was advanced in
payment of a house and lot located at #19952 Chestnut
Street, Executive Heights Subdivision, Paranaque. 14 A formal
demand letter by counsel for petitioner dated August 24,
1994 sent to and received by respondent was also on
record.15
All these pieces of evidence, taken together with
respondents admission that he and his wife received the
subject amount and used the same to purchase their house
and lot, sufficiently prove by a preponderance of evidence
petitioners claim that the amount of US$25,000.00 was
really in the nature of a loan.
Respondent tried to rebut petitioners evidence by claiming
that the US$25,000.00 was not a loan but his share in the
profits of H.L. Carlos Construction. He alleged that he
received money from petitioner amounting to almost P3
million as his share in the profits of the corporation. To prove
this, he presented ten (10) Bank of the Philippine Islands
(BPI) checks allegedly given to him by petitioner. 16He argued
that if indeed, he and his wife were indebted to petitioner,
the latter could have easily deducted the amount of the said
loan from his share of the profits.
Respondent fails to convince this Court.

All the checks presented by respondent, which he claims to


be his share in the profits of petitioners company, were all
in the account of H.L. Carlos Construction.17 On the other
hand, the Bankers Trust Check in the amount of
US$25,000.00 was drawn from the personal account of
petitioner.18Assuming to be true that the checks presented
by respondent were his profits from the corporation, then all
the more does this prove that the amount of US$25,000.00
was not part of such profits because it was issued by
petitioner from his own account. Indeed, if such amount was
respondents share of the profits, then the same should have
been issued under the account of H.L. Carlos Construction.
Moreover, respondent failed to substantiate his claim that he
is entitled to the profits and income of the corporation. There
was no showing that respondent was a stockholder of H.L.
Carlos Construction. His name does not appear in the
Articles of Incorporation as well as the Organizational Profile
of said company either as stockholder or officer. 19 Not being
a stockholder, he cannot be entitled to the profits or income
of said corporation. Neither did respondent prove that he
was an employee or an agent so as to be entitled to salaries
or commissions from the corporation.
We quote with favor the disquisition of the trial court on this
point:
Early in time, it must be noted that payment of personal
debts contracted by the husband or the wife before or
during the marriage shall not be charged to the conjugal
partnership except insofar as they redounded to the benefit
of the family. The defendants never denied that the check
of US$25,000.00 was used to purchase the subject house
and lot. They do not deny that the same served as their
conjugal home, thus benefiting the family. On the same
principle, acknowledgment of the loan made by the
defendant-wife binds the conjugal partnership since its
proceeds redounded to the benefit of the family. Hence,
defendant-husband and defendant-wife are jointly and
severally liable in the payment of the loan.
Defendant-husband cannot allege as a defense that the
amount of US $25,000.00 was received as his share in the
income or profits of the corporation and not as a loan.
Firstly, defendant-husband does not appear to be a
stockholder nor an employee nor an agent of the
corporation, H. L. Carlos Construction, Inc. Since he is not a
stockholder, he has no right to participate in the income or
profits thereof. In the same manner that as he is not an
employee nor an agent of H. L. Carlos Construction, Inc., he
has no right to receive any salary or commission therefrom.
Secondly, the amount advanced for the purchase of the
house and lot came from the personal account of the
plaintiff. If, indeed, it was to be construed as defendanthusbands share in the profits of the corporation, the
checks should come from the corporations account and not
from the plaintiffs personal account, considering that the
corporation has a personality separate and distinct from
that of its stockholders and officers.1wphi1.nt
Even granting that the checks amount to US $3,000.000.00
given by the plaintiff to the defendant-spouses was their
share in the profits of the corporation, still there is no
sufficient evidence to establish that the US $25,000.00 is to
be treated similarly. Defendant-husband in invoking the
defense of compensation argued that if indeed they were
indebted to the plaintiff, the latter could have applied their
share in the proceeds or income of the corporation to the
concurrent amount of the alleged loan, instead of giving
the amount of P3,000,000.00 to them. This argument is
untenable. Article 1278 of the Civil Code provides that
compensation shall take place when two persons, in their
own right, are debtors and creditors of each other. As its
indicates, compensation is a sort of balancing between two
obligations. In the instant case, the plaintiff and the
defendant-husband are not debtors and creditors of each
other. Even granting that the defendant-husbands claim to
the profits of the corporation is justified, still compensation
cannot extinguish his loan obligation to the plaintiff
because under such assumption, the defendant is dealing
with the corporation and not with the plaintiff in his
personal capacity. Hence, compensation cannot take place.

The Court of Appeals, thus, erred in finding that


respondents liability was not proved by preponderance of
evidence. On the contrary, the evidence adduced by
petitioner sufficiently established his claim that the
US$25,000.00 he advanced to respondent and his wife was a
loan.

In his house, sir.

And where did he actually prepare that letter?

At the dining table, sir.

The loan is the liability of the conjugal partnership pursuant


to Article 121 of the Family Code:

Q
How far were you from Manuel Abelardo from the
dining table at the time when he was preparing a letter.

Article 121. The conjugal partnership shall be liable for:


xxx
(2) All debts and obligations contracted during the
marriage by the designated administrator-spouse for the
benefit of the conjugal partnership of gains, or by both
spouses or by one of them with the consent of the other;
(3) Debts and obligations contracted by either spouse
without the consent of the other to the extent that the
family may have been benefited;
If the conjugal partnership is insufficient to cover the
foregoing liabilities, the spouses shall be solidarily liable
for the unpaid balance with their separate properties.
xxx
While respondent did not and refused to sign the
acknowledgment executed and signed by his wife,
undoubtedly, the loan redounded to the benefit of the family
because it was used to purchase the house and lot which
became the conjugal home of respondent and his family.
Hence, notwithstanding the alleged lack of consent of
respondent, under Art. 21 of the Family Code, he shall be
solidarily liable for such loan together with his wife.

Around 1 meter, sir.

Q
And do you know where in, what particular paper did
Mr. Abelardo prepare or write this letter?
A

He wrote it in a Manila envelope, sir.


xxx

Q
What happened after Manuel Abelardo prepared this
letter in a Manila envelope?
A
He got a small envelope and placed there the name
of Mr. Carlos as the addressee, sir.
xxx
Q
After preparing this letter on a Manila envelope and
then getting another envelope and writing on it the
address of herein plaintiff, what did the defendant Manuel
Abelardo do, if any?
A
He instructed me to mail the letter which he
prepared, sir.
xxx

We also find sufficient basis for the award of damages to


petitioner, contrary to the findings of the Court of Appeals
that petitioner is not entitled thereto.

Q
And did you actually accede to the request of herein
defendant Manuel Abelardo for you to mail that letter to
Engr. Carlos?

Petitioners allegations of verbal and written threats directed


against him by respondent is duly supported by evidence on
record. He presented two witnesses, Irineo Pajarin and
Randy Rosal, who testified on separate incidents where
threats were made by respondent against petitioner.

Randy Rosal, driver of petitioner, declared that around three


o clock in the afternoon of September 15, 1991, he was sent
by respondents wife on an errand to deliver the
acknowledgment letter to respondent for him to sign.
Respondent did not sign the acknowledgment and instead,
wrote a letter addressed to petitioner threatening him. He
narrated what took place thereafter:
xxx
Q
When you were requested by Ma. Theresa C.
Abelardo to bring a letter to herein defendant Manuel
Abelardo for him to sign the same, do you know whether
that letter was actually signed by Manuel Abelardo?
A

xxx
Q
May we know from you the reason why you did not
mail said letter?
A

xxx
Q
And what happened when Manuel Abelardo refused
to sign that letter coming from the other defendant?
A
He made me wait and he prepared a letter to Mr.
Honorio Carlos, sir.
xxx
Q
Where were you at the time when this defendant
Manuel Abelardo prepared this letter?

Because Engr. Carlos might become frightened, sir.

Q
What did you do with that letter, although you did
not mail it?
A

I kept it, sir.


xxx

Q
And what did you do next after keeping the letter for
several days?
A

No, sir.

I got the envelope but I did not mail it, sir.

I gave the letter personally to Engr. Carlos, sir.

Q
What prompted you to give that letter to Engr.
Carlos instead of mailing it?
A

So that Engr. Carlos can prepare, sir.


x

x20

This incident was duly entered and recorded in the Police


Blotter on October 7, 1991 by a certain Sgt. Casile of the
Valenzuela Police Station.21 A photocopy of this written
threat was also attached to the Police Report and presented
in evidence.22

Another witness, Irineo Pajarin, recounted an incident which


occurred in the afternoon of May 25, 1994, to wit:
xxx
Q
Now Mr. Witness, on May 25, 1994 at around 2:30 in
the afternoon do you recall where you were on that
particular date and time?
A

I was at B.F. Homes, Paranaque, sir.

What were you doing at that time?

I was waiting for Sargie Cornista, sir.


xxx

Q
And when he said his father in law to whom was he
referring at that time?
A

Mr. Honorio Carlos, sir.

Q
After mentioning the name of his father-in-law Mr.
Honorio Carlos what happened next?
A
He told me "Sabihin mo sa biyenan ko babarilin ko
siya pag nakita ko siya."
Q
Where was Manuel Abelardo at that particular time
when he told this threatening remark against Honorio
Carlos?
A

He was inside his car in Aguirre St., sir.

Q
Will you please narrate to this Honorable Court that
unusual incident?

Q
How about you where were you approximately at
that particular time when he narrated that message to
you threatening the herein plaintiff?

A
Manuel Abelardo passed by and when he saw me he
called me. I approached him while he was then on board
his car and asked me who was my companion, sir.

I was outside looking in his vehicle at Aguirre St., sir.


xxx

And what was your answer to him?

I told him it was Sargie, sir.

Q
And what was your reply or reaction when he made
this threatening remarks?

And what was his reply if any?

A
He again asked me if I have in my company one of
his children, sir.
Q

What was your reply?

I answered none, sir.

Q
Incidentally Mr. Witness, where or in what particular
place did this conversation between you and Manuel T.
Abelardo take place?
A
Parking Area of Academy I, Gov. Santos corner
Aguirre St., sir.
Q
Now, what else happened after you talk[ed] with
this Manuel T. Abelardo?
A
He said I may be fooling him because he said I once
fooled him when I ran away with his children which he is
going to take back, sir.
Q

And what was your reply to that?

A
I answered I did not do that and he said that once he
discovered that I did it he would box me, sir.
Q

What else if any did he tell you at that time?

He asked me who instructed me, sir.

Instructed you about what?

To run away with the children, sir.

And what was your reply?

None, because he left. I was left behind, sir.23

This testimony was in part corroborated by an entry dated


May 28, 1994 in the Police Blotter of the Paranaque Police
Station narrating the aforementioned incident.24
The testimonies of these witnesses on the two separate
incidents of threat are positive, direct and straightforward.
Petitioner also declared on the witness stand that on several
occasions, he received telephone calls from respondent
cursing and threatening him.25These incidents of threat were
also evidenced by a letter written by respondents wife and
addressed to her father-in-law (father of respondent). 26The
letter recounted the instances when threats were made by
her husband against petitioner, particularly, the incident
reported by Pajarin and the threats made by respondent
through the telephone.27
All these circumstances sufficiently establish that threats
were directed by respondent against petitioner justifying the
award of moral damages in favor of petitioner. However, the
Court finds the amount of P500,000.00 as moral damages
too exorbitant under the circumstances and the same is
reduced to P50,000.00. The exemplary damages and
attorneys fees are likewise reduced to P20,000.00
and P50,000.00, respectively.
WHEREFORE, the petition is hereby GRANTED and the
decision of the Court of Appeals in CA GR-CV No. 54464
is MODIFIED in that respondent is ordered to pay petitioner
the amounts of (1) US$25,000 or its equivalent in Philippine
currency at the time of payment, plus legal interest from
August 4, 1994, until fully paid; (2) P50,000.00 as moral
damages; (3) P20,000.00 as exemplary damages; and
(4) P50,000.00 as attorneys fees.1wphi1.nt
SO ORDERED.

G.R. No. 160347


A
None, he was the one who said "was it your Ate
Puppet?" But I did not answer, sir.
Q

What happened next when you failed to answer?

"Or my father in law?"

November 29, 2006

ARCADIO and MARIA LUISA CARANDANG, Petitioners,


vs.
HEIRS OF QUIRINO A. DE GUZMAN, namely: MILAGROS
DE GUZMAN, VICTOR DE GUZMAN, REYNALDO DE
GUZMAN, CYNTHIA G. RAGASA and QUIRINO DE
GUZMAN, JR., Respondents.
DECISION

CHICO-NAZARIO, J.:
This is a Petition for Review on Certiorari assailing the Court
of Appeals Decision1 and Resolution affirming the Regional
Trial Court (RTC) Decision rendering herein petitioners
Arcadio and Luisa Carandang [hereinafter referred to as
spouses Carandang] jointly and severally liable for their loan
to Quirino A. de Guzman.
The Court of Appeals summarized the facts as follows:
[Quirino de Guzman] and [the Spouses Carandang] are
stockholders as well as corporate officers of Mabuhay
Broadcasting System (MBS for brevity), with equities at fifty
four percent (54%) and forty six percent (46%) respectively.
On November 26, 1983, the capital stock of MBS was
increased, from P500,000 to P1.5 million and P345,000 of
this increase was subscribed by [the spouses Carandang].
Thereafter, on March 3, 1989, MBS again increased its
capital stock, from P1.5 million to P3 million, [the spouses
Carandang] yet again subscribed to the increase. They
subscribed to P93,750 worth of newly issued capital stock.
[De Guzman] claims that, part of the payment for these
subscriptions were paid by him, P293,250 for the November
26, 1983 capital stock increase and P43,125 for the March 3,
1989 Capital Stock increase or a total ofP336,375. Thus, on
March 31, 1992, [de Guzman] sent a demand letter to [the
spouses Carandang] for the payment of said total amount.
[The spouses Carandang] refused to pay the amount,
contending that a pre-incorporation agreement was
executed between [Arcadio Carandang] and [de Guzman],
whereby the latter promised to pay for the stock
subscriptions of the former without cost, in consideration for
[Arcadio Carandangs] technical expertise, his newly
purchased equipment, and his skill in repairing and
upgrading radio/communication equipment therefore, there
is no indebtedness on their part [sic].
On June 5, 1992, [de Guzman] filed his complaint, seeking to
recover the P336,375 together with damages. After trial on
the merits, the trial court disposed of the case in this wise:
"WHEREFORE, premises considered, judgment is hereby
rendered in favor of [de Guzman]. Accordingly, [the spouses
Carandang] are ordered to jointly and severally pay [de
Guzman], to wit:
(1) P336,375.00 representing [the spouses Carandangs]
loan to de Guzman;
(2) interest on the preceding amount at the rate of twelve
percent (12%) per annum from June 5, 1992 when this
complaint was filed until the principal amount shall have
been fully paid;

The spouses Carandang then filed before this Court the


instant Petition for Review on Certiorari, bringing forth the
following issues:
I.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
COMMITTED MANIFEST ERROR IN FAILING TO STRICTLY
COMPLY WITH SECTION 16, RULE 3 OF THE 1997 RULES OF
CIVIL PROCEDURE.
II.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED IN ITS FINDING THAT THERE IS AN
ALLEGED LOAN FOR WHICH PETITIONERS ARE LIABLE,
CONTRARY TO EXPRESS PROVISIONS OF BOOK IV, TITLE XI,
OF THE NEW CIVIL CODE PERTAINING TO LOANS.
III.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED IN FINDING THAT THE RESPONDENTS
WERE ABLE TO DISCHARGE THEIR BURDEN OF PROOF, IN
COMPLETE DISREGARD OF THE REVISED RULES ON
EVIDENCE.
IV.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
COMMITTED REVERSIBLE ERROR WHEN IT FAILED TO APPLY
SECTIONS 2 AND 7, RULE 3 OF THE 1997 RULES OF CIVIL
PROCEDURE.
V.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED IN FINDING THAT THE PURPORTED
LIABILITY OF PETITIONERS ARE JOINT AND SOLIDARY, IN
VIOLATION OF ARTICLE 1207 OF THE NEW CIVIL CODE.4
Whether or not the RTC Decision is void for failing to comply
with Section 16, Rule 3 of the Rules of Court
The spouses Carandang claims that the Decision of the RTC,
having been rendered after the death of Quirino de Guzman,
is void for failing to comply with Section 16, Rule 3 of the
Rules of Court, which provides:
SEC. 16. Death of party; duty of counsel. Whenever a party
to a pending action dies, and the claim is not thereby
extinguished, it shall be the duty of his counsel to inform the
court within thirty (30) days after such death of the fact
thereof, and to give the name and address of his legal
representative or representatives. Failure of counsel to
comply with this duty shall be a ground for disciplinary
action.

(3) P20,000.00 as attorneys fees;


(4) Costs of suit.
The spouses Carandang appealed the RTC Decision to the
Court of Appeals, which affirmed the same in the 22 April
2003 assailed Decision:
WHEREFORE, in view of all the foregoing the assailed
Decision is hereby AFFIRMED. No costs.2
The Motion for Reconsideration filed by the spouses
Carandang was similarly denied by the Court of Appeals in
the 6 October 2003 assailed Resolution:
WHEREFORE, in view thereof, the motion for reconsideration
is hereby DENIED and our Decision of April 22, 2003, which
is based on applicable law and jurisprudence on the matter
is hereby AFFIRMED and REITERATED.3

The heirs of the deceased may be allowed to be substituted


for the deceased, without requiring the appointment of an
executor or administrator and the court may appoint a
guardian ad litem for the minor heirs.
The court shall forthwith order the legal representative or
representatives to appear and be substituted within a period
of thirty (30) days from notice.
If no legal representative is named by the counsel for the
deceased party, or if the one so named shall fail to appear
within the specified period, the court may order the
opposing party, within a specified time, to procure the
appointment of an executor or administrator for the estate
of the deceased and the latter shall immediately appear for
and on behalf of the deceased. The court charges in
procuring such appointment, if defrayed by the opposing
party, may be recovered as costs.
The spouses Carandang posits that such failure to comply
with the above rule renders void the decision of the RTC, in

adherence to the following pronouncements in Vda. de


Haberer v. Court of Appeals5 and Ferreria v. Vda. de
Gonzales6 :
Thus, it has been held that when a party dies in an action
that survives and no order is issued by the court for the
appearance of the legal representative or of the heirs of the
deceased in substitution of the deceased, and as a matter of
fact no substitution has ever been effected, the trial held by
the court without such legal representatives or heirs and the
judgment rendered after such trial are null and void because
the court acquired no jurisdiction over the persons of the
legal representatives or of the heirs upon whom the trial and
judgment would be binding.7

because of the express waiver of the heirs to the jurisdiction


over their persons, and because there had been, before the
promulgation of the RTC Decision, no further proceedings
requiring the appearance of de Guzmans counsel.
Before proceeding with the substantive aspects of the case,
however, there is still one more procedural issue to tackle,
the fourth issue presented by the spouses Carandang on the
non-inclusion in the complaint of an indispensable party.
Whether or not the RTC should have dismissed the case for
failure to state a cause of action, considering that Milagros
de Guzman, allegedly an indispensable party, was not
included as a party-plaintiff

In the present case, there had been no court order for the
legal representative of the deceased to appear, nor had any
such legal representative appeared in court to be
substituted for the deceased; neither had the complainant
ever procured the appointment of such legal representative
of the deceased, including appellant, ever asked to be
substituted for the deceased. As a result, no valid
substitution was effected, consequently, the court never
acquired jurisdiction over appellant for the purpose of
making her a party to the case and making the decision
binding upon her, either personally or as a representative of
the estate of her deceased mother.8

The spouses Carandang claim that, since three of the four


checks used to pay their stock subscriptions were issued in
the name of Milagros de Guzman, the latter should be
considered an indispensable party. Being such, the spouses
Carandang claim, the failure to join Mrs. de Guzman as a
party-plaintiff should cause the dismissal of the action
because "(i)f a suit is not brought in the name of or against
the real party in interest, a motion to dismiss may be filed on
the ground that the complaint states no cause of action." 14

However, unlike jurisdiction over the subject matter which is


conferred by law and is not subject to the discretion of the
parties,9 jurisdiction over the person of the parties to the
case may be waived either expressly or impliedly. 10 Implied
waiver comes in the form of either voluntary appearance or
a failure to object.11

We disagree. The joint account of spouses Quirino A de


Guzman and Milagros de Guzman from which the four (4)
checks were drawn is part of their conjugal property and
under both the Civil Code and the Family Code the husband
alone may institute an action for the recovery or protection
of the spouses conjugal property.

In the cases cited by the spouses Carandang, we held that


there had been no valid substitution by the heirs of the
deceased party, and therefore the judgment cannot be
made binding upon them. In the case at bar, not only do the
heirs of de Guzman interpose no objection to the jurisdiction
of the court over their persons; they are actually claiming
and embracing such jurisdiction. In doing so, their waiver is
not even merely implied (by their participation in the appeal
of said Decision), but express (by their explicit espousal of
such view in both the Court of Appeals and in this Court).
The heirs of de Guzman had no objection to being bound by
the Decision of the RTC.

Thus, in Docena v. Lapesura [355 SCRA 658], the Supreme


Court held that "x x x Under the New Civil Code, the
husband is the administrator of the conjugal partnership. In
fact, he is the sole administrator, and the wife is not entitled
as a matter of right to join him in this endeavor. The
husband may defend the conjugal partnership in a suit or
action without being joined by the wife. x x x Under the
Family Code, the administration of the conjugal property
belongs to the husband and the wife jointly. However, unlike
an act of alienation or encumbrance where the consent of
both spouses is required, joint management or
administration does not require that the husband and wife
always act together. Each spouse may validly exercise full
power of management alone, subject to the intervention of
the court in proper cases as provided under Article 124 of
the Family Code. x x x."

Thus, lack of jurisdiction over the person, being subject to


waiver, is a personal defense which can only be asserted by
the party who can thereby waive it by silence.

The Court of Appeals held:

It also pays to look into the spirit behind the general rule
requiring a formal substitution of heirs. The underlying
principle therefor is not really because substitution of heirs is
a jurisdictional requirement, but because non-compliance
therewith results in the undeniable violation of the right to
due process of those who, though not duly notified of the
proceedings, are substantially affected by the decision
rendered therein.12 Such violation of due process can only be
asserted by the persons whose rights are claimed to have
been violated, namely the heirs to whom the adverse
judgment is sought to be enforced.

The Court of Appeals is correct. Petitioners erroneously


interchange the terms "real party in interest" and
"indispensable party." A real party in interest is the party
who stands to be benefited or injured by the judgment of the
suit, or the party entitled to the avails of the suit.15 On the
other hand, an indispensable party is a party in interest
without whom no final determination can be had of an
action,16 in contrast to a necessary party, which is one who is
not indispensable but who ought to be joined as a party if
complete relief is to be accorded as to those already parties,
or for a complete determination or settlement of the claim
subject of the action.17

Care should, however, be taken in applying the foregoing


conclusions. In People v. Florendo,13 where we likewise held
that the proceedings that took place after the death of the
party are void, we gave another reason for such nullity: "the
attorneys for the offended party ceased to be the attorneys
for the deceased upon the death of the latter, the principal x
x x." Nevertheless, the case at bar had already been
submitted for decision before the RTC on 4 June 1998,
several months before the passing away of de Guzman on
19 February 1999. Hence, no further proceedings requiring
the appearance of de Guzmans counsel were conducted
before the promulgation of the RTC Decision. Consequently,
de Guzmans counsel cannot be said to have no authority to
appear in trial, as trial had already ceased upon the death of
de Guzman.

The spouses Carandang are indeed correct that "(i)f a suit is


not brought in the name of or against the real party in
interest, a motion to dismiss may be filed on the ground that
the complaint states no cause of action." 18However, what
dismissal on this ground entails is an examination
of whether the parties presently pleaded are interested in
the outcome of the litigation, and not whether all persons
interested in such outcome are actually pleaded. The latter
query is relevant in discussions concerning indispensable
and necessary parties, but not in discussions
concerning real parties in interest. Both indispensable and
necessary parties are considered as real parties in interest,
since both classes of parties stand to be benefited or injured
by the judgment of the suit.

In sum, the RTC Decision is valid despite the failure to


comply with Section 16, Rule 3 of the Rules of Court,

Quirino and Milagros de Guzman were married before the


effectivity of the Family Code on 3 August 1988. As they did

not execute any marriage settlement, the regime of conjugal


partnership of gains govern their property relations.19
All property acquired during the marriage, whether the
acquisition appears to have been made, contracted or
registered in the name of one or both spouses, is presumed
to be conjugal unless the contrary is proved. 20Credits are
personal properties,21 acquired during the time the loan or
other credit transaction was executed. Therefore, credits
loaned during the time of the marriage are presumed to be
conjugal property.
Consequently, assuming that the four checks created a debt
for which the spouses Carandang are liable, such credits are
presumed to be conjugal property. There being no evidence
to the contrary, such presumption subsists. As such, Quirino
de Guzman, being a co-owner of specific partnership
property,22 is certainly a real party in interest. Dismissal on
the ground of failure to state a cause of action, by reason
that the suit was allegedly not brought by a real party in
interest, is therefore unwarranted.

must be followed: such non-joinder is not a ground for


dismissal. Hence, in a case concerning an action to recover a
sum of money, we held that the failure to join the spouse in
that case was not a jurisdictional defect. 26The non-joinder of
a spouse does not warrant dismissal as it is merely a formal
requirement which may be cured by amendment.27
Conversely, in the instances that the pro-forma parties are
also indispensable or necessary parties, the rules concerning
indispensable or necessary parties, as the case may be,
should be applied. Thus, dismissal is warranted only if the
pro-forma party not joined in the complaint is an
indispensable party.
Milagros de Guzman, being presumed to be a co-owner of
the credits allegedly extended to the spouses Carandang,
seems to be either an indispensable or a necessary party. If
she is an indispensable party, dismissal would be proper. If
she is merely a necessary party, dismissal is not warranted,
whether or not there was an order for her inclusion in the
complaint pursuant to Section 9, Rule 3.

So now we come to the discussion concerning indispensable


and necessary parties. When an indispensable party is not
before the court, the action should likewise be
dismissed.23 The absence of an indispensable party renders
all subsequent actuations of the court void, for want of
authority to act, not only as to the absent parties but even
as to those present.24 On the other hand, the non-joinder of
necessary parties do not result in the dismissal of the case.
Instead, Section 9, Rule 3 of the Rules of Court provides for
the consequences of such non-joinder:

Article 108 of the Family Code provides:

Sec. 9. Non-joinder of necessary parties to be pleaded.


Whenever in any pleading in which a claim is asserted a
necessary party is not joined, the pleader shall set forth his
name, if known, and shall state why he is omitted. Should
the court find the reason for the omission unmeritorious, it
may order the inclusion of the omitted necessary party if
jurisdiction over his person may be obtained.

Art. 147. The conjugal partnership shall be governed by the


rules on the contract of partnership in all that is not in
conflict with what is expressly determined in this Chapter.

The failure to comply with the order for his inclusion, without
justifiable cause, shall be deemed a waiver of the claim
against such party.
The non-inclusion of a necessary party does not prevent the
court from proceeding in the action, and the judgment
rendered therein shall be without prejudice to the rights of
such necessary party.
Non-compliance with the order for the inclusion of a
necessary party would not warrant the dismissal of the
complaint. This is an exception to Section 3, Rule 17 which
allows the dismissal of the complaint for failure to comply
with an order of the court, as Section 9, Rule 3 specifically
provides for the effect of such non-inclusion: it shall not
prevent the court from proceeding in the action, and the
judgment rendered therein shall be without prejudice to the
rights of such necessary party. Section 11, Rule 3 likewise
provides that the non-joinder of parties is not a ground for
the dismissal of the action.

Art. 108. The conjugal partnership shall be governed by the


rules on the contract of partnership in all that is not in
conflict with what is expressly determined in this Chapter or
by the spouses in their marriage settlements.
This provision is practically the same as the Civil Code
provision it superceded:

In this connection, Article 1811 of the Civil Code provides


that "[a] partner is a co-owner with the other partners of
specific partnership property." Taken with the presumption of
the conjugal nature of the funds used to finance the four
checks used to pay for petitioners stock subscriptions, and
with the presumption that the credits themselves are part of
conjugal funds, Article 1811 makes Quirino and Milagros de
Guzman co-owners of the alleged credit.
Being co-owners of the alleged credit, Quirino and Milagros
de Guzman may separately bring an action for the recovery
thereof. In the fairly recent cases of Baloloy v.
Hular28 and Adlawan v. Adlawan,29 we held that, in a coownership, co-owners may bring actions for the recovery of
co-owned property without the necessity of joining all the
other co-owners as co-plaintiffs because the suit is
presumed to have been filed for the benefit of his co-owners.
In the latter case and in that of De Guia v. Court of
Appeals,30 we also held that Article 487 of the Civil Code,
which provides that any of the co-owners may bring an
action for ejectment, covers all kinds of action for the
recovery of possession.31

Sec. 4. Spouses as parties. Husband and wife shall sue or


be sued jointly, except as provided by law.

In sum, in suits to recover properties, all co-owners are real


parties in interest. However, pursuant to Article 487 of the
Civil Code and relevant jurisprudence, any one of them may
bring an action, any kind of action, for the recovery of coowned properties. Therefore, only one of the co-owners,
namely the co-owner who filed the suit for the recovery of
the co-owned property, is an indispensable party thereto.
The other co-owners are not indispensable parties. They are
not even necessary parties, for a complete relief can be
accorded in the suit even without their participation, since
the suit is presumed to have been filed for the benefit of all
co-owners.32

Pro-forma parties can either be indispensable, necessary or


neither indispensable nor necessary. The third case occurs if,
for example, a husband files an action to recover a property
which he claims to be part of his exclusive property. The wife
may have no legal interest in such property, but the rules
nevertheless require that she be joined as a party.

We therefore hold that Milagros de Guzman is not an


indispensable party in the action for the recovery of the
allegedly loaned money to the spouses Carandang. As such,
she need not have been impleaded in said suit, and
dismissal of the suit is not warranted by her not being a
party thereto.

In cases of pro-forma parties who are neither indispensable


nor necessary, the general rule under Section 11, Rule 3

Whether or not respondents were able to prove the loan


sought to be collected from petitioners

Other than the indispensable and necessary parties, there is


a third set of parties: the pro-forma parties, which are those
who are required to be joined as co-parties in suits by or
against another party as may be provided by the applicable
substantive law or procedural rule.25 An example is provided
by Section 4, Rule 3 of the Rules of Court:

In the second and third issues presented by the spouses


Carandang, they claim that the de Guzmans failed to prove
the alleged loan for which the spouses Carandang were held
liable. As previously stated, spouses Quirino and Milagros de
Guzman paid for the stock subscriptions of the spouses
Carandang, amounting to P336,375.00. The de Guzmans
claim that these payments were in the form of loans and/or
advances and it was agreed upon between the late Quirino
de Guzman, Sr. and the spouses Carandang that the latter
would repay him. Petitioners, on the other hand, argue that
there was an oral pre-incorporation agreement wherein it
was agreed that Arcardio Carandang would always maintain
his 46% equity participation in the corporation even if the
capital structures were increased, and that Quirino de
Guzman would personally pay the equity shares/stock
subscriptions of Arcardio Carandang with no cost to the
latter.
On this main issue, the Court of Appeals held:
[The spouses Carandang] aver in its ninth assigned error
that [the de Guzmans] failed to prove by preponderance of
evidence, either the existence of the purported loan or the
non-payment thereof.
Simply put, preponderance of evidence means that the
evidence as a whole adduced by one side is superior to that
of the other. The concept of preponderance of evidence
refers to evidence that is of greater weight, or more
convincing, than that which is offered in opposition to it; it
means probability of truth.
[The spouses Carandang] admitted that it was indeed [the
de Guzmans] who paid their stock subscriptions and their
reason for not reimbursing the latter is the alleged preincorporation agreement, to which they offer no clear proof
as to its existence.
It is a basic rule in evidence that each party must prove his
affirmative allegation. Thus, the plaintiff or complainant has
to prove his affirmative allegations in the complaints and the
defendant or respondent has to prove the affirmative
allegations in his affirmative defenses and counterclaims.33
The spouses Carandang, however, insist that the de
Guzmans have not proven the loan itself, having presented
evidence only of the payment in favor of the Carandangs.
They claim:

Art. 1237. Whoever pays on behalf of the debtor without the


knowledge or against the will of the latter, cannot compel
the creditor to subrogate him in his rights, such as those
arising from a mortgage, guarantee, or penalty.
Articles 1236 and 1237 are clear that, even in cases where
the debtor has no knowledge of payment by a third person,
and even in cases where the third person paid against the
will of the debtor, such payment would produce a debt in
favor of the paying third person. In fact, the only
consequences for the failure to inform or get the consent of
the debtor are the following: (1) the third person can recover
only insofar as the payment has been beneficial to the
debtor; and (2) the third person is not subrogated to the
rights of the creditor, such as those arising from a mortgage,
guarantee or penalty.35
We say, however, that this is merely a presumption. By
virtue of the parties freedom to contract, the parties could
stipulate otherwise and thus, as suggested by the spouses
Carandang, there is indeed a possibility that such payment
by Mr. "A" was purely out of generosity or that there was a
mutual agreement between them. But such mutual
agreement, being an exception to presumed course of
events as laid down by Articles 1236 and 1237, must be
adequately proven.
The de Guzmans have successfully proven their payment of
the spouses Carandangs stock subscriptions. These
payments were, in fact, admitted by the spouses Carandang.
Consequently, it is now up to the spouses Carandang to
prove the existence of the pre-incorporation agreement that
was their defense to the purported loan.
Unfortunately for the spouses Carandang, the only
testimony which touched on the existence and substance of
the pre-incorporation agreement, that of petitioner Arcardio
Carandang, was stricken off the record because he did not
submit himself to a cross-examination of the opposing party.
On the other hand, the testimonies of Romeo
Saavedra,36 Roberto S. Carandang,37 Gertrudes Z.
Esteban,38 Ceferino Basilio,39 and Ma. Luisa
Carandang40touched on matters other than the existence
and substance of the pre-incorporation agreement. So aside
from the fact that these witnesses had no personal
knowledge as to the alleged existence of the preincorporation agreement, the testimonies of these witnesses
did not even mention the existence of a pre-incorporation
agreement.

It is an undeniable fact that payment is not equivalent to a


loan. For instance, if Mr. "A" decides to pay for Mr. "Bs"
obligation, that payment by Mr. "A" cannot, by any stretch of
imagination, possibly mean that there is now a loan by Mr.
"B" to Mr. "A". There is a possibility that such payment by Mr.
"A" is purely out of generosity or that there is a mutual
agreement between them. As applied to the instant case,
that mutual agreement is the pre-incorporation agreement
(supra) existing between Mr. de Guzman and the petitioners
--- to the effect that the former shall be responsible for
paying stock subscriptions of the latter. Thus, when Mr. de
Guzman paid for the stock subscriptions of the petitioners,
there was no loan to speak of, but only a compliance with
the pre-incorporation agreement.34

Worse, the testimonies of petitioners Arcadio Carandang and


Ma. Luisa Carandang even contradicted the existence of a
pre-incorporation agreement because when they were asked
by their counsel regarding the matter of the check payments
made by the late Quirino A. de Guzman, Sr. in their behalf,
they said that they had already paid for it thereby negating
their own defense that there was a pre-incorporation
agreement excusing themselves from paying Mr. de Guzman
the amounts he advanced or loaned to them. This basic and
irrefutable fact can be gleaned from their testimonies which
the private respondents are quoting for easy reference:

The spouses Carandang are mistaken. If indeed a Mr. "A"


decides to pay for a Mr. "Bs" obligation, the presumption is
that Mr. "B" is indebted to Mr. "A" for such amount that has
been paid. This is pursuant to Articles 1236 and 1237 of the
Civil Code, which provide:

Q: Now, can you tell this Honorable Court how do you feel
with respect to the Complaint of the plaintiff in this case
charging you that you paid for this year and asking enough
to paid (sic) your tax?

Art. 1236. The creditor is not bound to accept payment or


performance by a third person who has no interest in the
fulfillment of the obligation, unless there is a stipulation to
the contrary.

a. With respect to the testimony of Ma. Luisa Carandang

A: We have paid already, so, we are not liable for anything


payment (sic).41
b. With respect to the testimony of Arcadio Carandang
"Q: How much?

Whoever pays for another may demand from the


debtor what he has paid, except that if he paid without
the knowledge or against the will of the debtor, he can
recover only insofar as the payment has been beneficial to
the debtor.

A: P40,000.00 to P50,000.00 per month.


Q: The plaintiff also claimed thru witness Edgar Ragasa, that
there were receipts issued for the payment of your shares;
which receipts were marked as Exhibits "G" to "L" (Plaintiff).

Im showing to you these receipts so marked by the plaintiff


as their exhibits which were issued in the name of Ma. Luisa
Carandang, your wife; and also, Arcadio M. Carandang. Will
you please go over this Official Receipt and state for the
records, who made for the payment stated in these receipts
in your name?
A: I paid for those shares."42
There being no testimony or documentary evidence proving
the existence of the pre-incorporation agreement, the
spouses Carandang are forced to rely upon an alleged
admission by the original plaintiff of the existence of the preincorporation agreement.
Petitioners claim that the late Quirino A. de Guzman, Sr. had
admitted the existence of the pre-incorporation agreement
by virtue of paragraphs 13 and 14 of their Answer and
paragraph 4 of private respondents Reply.
Paragraphs 13 and 14 of petitioners Answer dated 7 July
1992 state in full:
13. Sometime in November, 1973 or thereabout, herein
plaintiff invited defendant Arcadio M. Carandang to a joint
venture by pooling together their technical expertise,
equipments, financial resources and franchise. Plaintiff
proposed to defendant and mutually agreed on the
following:
1. That they would organize a corporation known as
Mabuhay Broadcasting Systems, Inc.
2. Considering the technical expertise and talent of
defendant Arcadio M. Carandang and his new
equipments he bought, and his skill in repairing and
modifying radio/communication equipments into high
proficiency, said defendant would have an equity
participation in the corporation of 46%, and plaintiff 54%
because of his financial resources and franchise.
3. That defendant would always maintain his 46% equity
participation in the corporation even if the capital
structures are increased, and that plaintiff would
personally pay the equity shares/stock subscriptions of
defendant with no cost to the latter.
4. That because of defendants expertise in the trade
including the marketing aspects, he would be the
President and General Manager, and plaintiff the
Chairman of the Board.
5. That considering their past and trustworthy relations,
they would maintain such relations in the joint venture
without any mental reservation for their common benefit
and success of the business.
14. Having mutually agreed on the above arrangements,
the single proprietorship of plaintiff was immediately
spun-off into a corporation now known as Mabuhay
Broadcasting System, Inc. The incorporators are plaintiff
and his family members/nominees controlling jointly 54%
of the stocks and defendant Arcadio M. Carandang
controlling singly 46% as previously agreed.43
Meanwhile, paragraphs 3 and 4 of private respondents
Reply dated 29 July 1992 state in full:
3. Plaintiffs admits the allegation in paragraph 13.1 of the
Answer only insofar the plaintiff and defendant Arcadio M.
Carandang organized a corporation known as Mabuhay
Broadcasting Systems, Inc. Plaintiff specifically denies the
other allegations in paragraph 13 of the Answer, the same
being devoid of any legal or factual bases. The truth of the
matter is that defendant Arcadio M. Carandang was not able
to pay plaintiff the agreed amount of the lease for a number
of months forcing the plaintiff to terminate lease.
Additionally, the records would show that it was the
defendant Arcadio M. Carandang who proposed a joint
venture with the plaintiff.

It appears that plaintiff agreed to the formation of the


corporation principally because of a directive of then
President Marcos indicating the need to broaden the
ownership of radio broadcasting stations. The plaintiff owned
the franchise, the radio transmitter, the antenna tower, the
building containing the radio transmitter and other
equipment. Verily, he would be placed in a great
disadvantage if he would still have to personally pay for the
shares of defendant Arcadio M. Carandang.
4. Plaintiff admits the allegations in paragraph 14 of the
Answer.44
In effect, the spouses Carandang are relying on the fact that
Quirino de Guzman stated that he admitted paragraph 14 of
the Answer, which incidentally contained the opening clause
"(h)aving mutually agreed on the above arrangements, x x
x."
Admissions, however, should be clear and unambiguous.
This purported admission by Quirino de Guzman reeks of
ambiguity, as the clause "(h)aving mutually agreed on the
above arrangements," seems to be a mere introduction to
the statement that the single proprietorship of Quirino de
Guzman had been converted into a corporation. If Quirino de
Guzman had meant to admit paragraph 13.3, he could have
easily said so, as he did the other paragraphs he
categorically admitted. Instead, Quirino de Guzman
expressly stated the opposite: that "(p)laintiff specifically
denies the other allegations of paragraph 13 of the
Answer."45 The Reply furthermore states that the only portion
of paragraph 13 which Quirino de Guzman had admitted is
paragraph 13.1, and only insofar as it said that Quirino de
Guzman and Arcardio Carandang organized Mabuhay
Broadcasting Systems, Inc.46
All the foregoing considered, we hold that Quirino de
Guzman had not admitted the alleged pre-incorporation
agreement. As there was no admission, and as the
testimony of Arcardio Carandang was stricken off the record,
we are constrained to rule that there was no preincorporation agreement rendering Quirino de Guzman liable
for the spouses Carandangs stock subscription. The
payment by the spouses de Guzman of the stock
subscriptions of the spouses Carandang are therefore by
way of loan which the spouses Carandang are liable to
pay.1wphi1
Whether or not the liability of the spouses Carandang is joint
and solidary
Finally, the Court of Appeals also upheld the RTC Decision
insofar as it decreed a solidary liability. According to the
Court of Appeals:
With regards (sic) the tenth assigned error, [the spouses
Carandang] contend that:
"There is absolutely no evidence, testimonial or
documentary, showing that the purported obligation of [the
spouses Carandang] is joint and solidary. x x x
"Furthermore, the purported obligation of [the spouses
Carandang] does not at all qualify as one of the obligations
required by law to be solidary x x x."
It is apparent from the facts of the case that [the spouses
Carandang] were married way before the effectivity of the
Family Code hence; their property regime is conjugal
partnership under the Civil Code.
It must be noted that for marriages governed by the rules of
conjugal partnership of gains, an obligation entered into by
the husband and wife is chargeable against their conjugal
partnership and it is the partnership, which is primarily
bound for its repayment. Thus, when the spouses are sued
for the enforcement of the obligation entered into by them,
they are being impleaded in their capacity as
representatives of the conjugal partnership and not as
independent debtors, such that the concept of joint and
solidary liability, as between them, does not apply. 47

The Court of Appeals is correct insofar as it held that when


the spouses are sued for the enforcement of the obligation
entered into by them, they are being impleaded in their
capacity as representatives of the conjugal partnership and
not as independent debtors. Hence, either of them may be
sued for the whole amount, similar to that of a solidary
liability, although the amount is chargeable against their
conjugal partnership property. Thus, in the case cited by the
Court of Appeals, Alipio v. Court of Appeals,48 the two sets of
defendant-spouses therein were held liable for P25,300.00
each, chargeable to their respective conjugal partnerships.
WHEREFORE, the Decision of the Court of Appeals, affirming
the judgment rendered against the spouses Carandang, is
hereby AFFIRMED with the following MODIFICATION: The
spouses Carandang are ORDERED to pay the following
amounts from their conjugal partnership properties:
(1) P336,375.00 representing the spouses
Carandangs loan to Quirino de Guzman; and
(2) Interest on the preceding amount at the rate of
twelve percent (12%) per annum from 5 June 1992
when the complaint was filed until the principal
amount can be fully paid; and
(3) P20,000.00 as attorneys fees.
No costs.

The averments in the complaint disclosed that plaintiffappellee Joe A. Ros obtained a loan of P115,000.00 from PNB
Laoag Branch on October 14, 1974 and as security for the
loan, plaintiff-appellee Ros executed a real estate mortgage
involving a parcel of land Lot No. 9161 of the Cadastral
Survey of Laoag, with all the improvements thereon
described under Transfer Certificate of Title No. T-9646.
Upon maturity, the loan remained outstanding. As a result,
PNB instituted extrajudicial foreclosure proceedings on the
mortgaged property. After the extrajudicial sale thereof, a
Certificate of Sale was issued in favor of PNB, Laoag as the
highest bidder. After the lapse of one (1) year without the
property being redeemed, the property was consolidated
and registered in the name of PNB, Laoag Branch on August
10, 1978.
Claiming that she (plaintiff-appellee Estrella Aguete) has no
knowledge of the loan obtained by her husband nor she
consented to the mortgage instituted on the conjugal
property a complaint was filed to annul the proceedings
pertaining to the mortgage, sale and consolidation of the
property interposing the defense that her signatures
affixed on the documents were forged and that the loan did
not redound to the benefit of the family.1avvphi1
In its answer, PNB prays for the dismissal of the complaint
for lack of cause of action, and insists that it was plaintiffsappellees own acts [of]
omission/connivance that bar them from recovering the
subject property on the ground of estoppel, laches,
abandonment and prescription.4]

SO ORDERED.

The Trial Courts Ruling


G.R. No. 170166

April 6, 2011

JOE A. ROS and ESTRELLA AGUETE, Petitioners,


vs.
PHILIPPINE NATIONAL BANK - LAOAG
BRANCH, Respondent.
DECISION
CARPIO, J.:
The Case
G.R. No. 170166 is a petition for review1 assailing the
Decision2 promulgated on 17 October 2005 by the Court of
Appeals (appellate court) in CA-G.R. CV No. 76845. The
appellate court granted the appeal filed by the Philippine
National Bank Laoag Branch (PNB). The appellate court
reversed the 29 June 2001 Decision of Branch 15 of the
Regional Trial Court of Laoag City (trial court) in Civil Case
No. 7803.
The trial court declared the Deed of Real Estate Mortgage
executed by spouses Jose A. Ros3 (Ros) and Estrella Aguete
(Aguete) (collectively, petitioners), as well as the
subsequent foreclosure proceedings, void. Aside from
payment of attorneys fees, the trial court also ordered PNB
to vacate the subject property to give way to petitioners
possession.
The Facts
The appellate court narrated the facts as follows:
On January 13, 1983, spouses Jose A. Ros and Estrella
Aguete filed a complaint for the annulment of the Real
Estate Mortgage and all legal proceedings taken thereunder
against PNB, Laoag Branch before the Court of First Instance,
Ilocos Norte docketed as Civil Case No. 7803.
The complaint was later amended and was raffled to the
Regional Trial Court, Branch 15, Laoag City.

On 29 June 2001, the trial court rendered its Decision 5 in


favor of petitioners. The trial court declared that Aguete did
not sign the loan documents, did not appear before the
Notary Public to acknowledge the execution of the loan
documents, did not receive the loan proceeds from PNB, and
was not aware of the loan until PNB notified her in 14 August
1978 that she and her family should vacate the mortgaged
property because of the expiration of the redemption period.
Under the Civil Code, the effective law at the time of the
transaction, Ros could not encumber any real property of the
conjugal partnership without Aguetes consent. Aguete may,
during their marriage and within ten years from the
transaction questioned, ask the courts for the annulment of
the contract her husband entered into without her consent,
especially in the present case where her consent is required.
The trial court, however, ruled that its decision is without
prejudice to the right of action of PNB to recover the amount
of the loan and its interests from Ros.
The dispositive portion reads:
WHEREFORE, premises considered, judgment is hereby
rendered:
1. DECLARING the Deed of Real Estate Mortgage
(Exhibit "C") and the subsequent foreclosure
proceedings conducted thereon NULL and VOID;
2. ORDERING the Register of Deeds of the City of
Laoag to cancel TCT No. T-15276 in the name of
defendant PNB and revert the same in the name of
plaintiffs spouses Joe Ros and Estrella Aguete;
3. ORDERING defendant to vacate and turnover the
possession of the premises of the property in suit to
the plaintiffs; and
4. ORDERING defendant to pay plaintiffs attorneys
fee and litigation expenses in the sum of TEN
THOUSAND (P10,000.00) PESOS.
No pronouncement as to costs.
SO ORDERED.6]

PNB filed its Notice of Appeal7 of the trial courts decision on


13 September 2001 and paid the corresponding fees.
Petitioners filed on the same date a motion for execution
pending appeal,8 which PNB opposed.9 In their comment to
the opposition10 filed on 10 October 2001, petitioners stated
that at the hearing of the motion on 3 October 2001, PNBs
lay representative had no objection to the execution of
judgment pending appeal. Petitioners claimed that the house
on the subject lot is dilapidated, a danger to life and limb,
and should be demolished. Petitioners added that they
obliged themselves to make the house habitable at a cost of
not less P50,000.00. The repair cost would accrue to PNBs
benefit should the appellate court reverse the trial court.
PNB continued to oppose petitioners motion. 11
In an Order12 dated 8 May 2002, the trial court found
petitioners motion for execution pending appeal improper
because petitioners have made it clear that they were
willing to wait for the appellate courts decision. However, as
a court of justice and equity, the trial court allowed
petitioners to occupy the subject property with the condition
that petitioners would voluntarily vacate the premises and
waive recovery of improvements introduced should PNB
prevail on appeal.
The Appellate Courts Ruling
On 17 October 2005, the appellate court rendered its
Decision13 and granted PNBs appeal. The appellate court
reversed the trial courts decision, and dismissed petitioners
complaint.
The appellate court stated that the trial court concluded
forgery without adequate proof; thus it was improper for the
trial court to rely solely on Aguetes testimony that her
signatures on the loan documents were forged. The
appellate court declared that Aguete affixed her signatures
on the documents knowingly and with her full consent.
Assuming arguendo that Aguete did not give her consent to
Ros loan, the appellate court ruled that the conjugal
partnership is still liable because the loan proceeds
redounded to the benefit of the family. The records of the
case reveal that the loan was used for the expansion of the
familys business. Therefore, the debt obtained is chargeable
against the conjugal partnership.
Petitioners filed the present petition for review before this
Court on 9 December 2005.
The Issues
Petitioners assigned the following errors:
I. The Honorable Court of Appeals erred in not giving weight
to the findings and conclusions of the trial court, and in
reversing and setting aside such findings and conclusions
without stating specific contrary evidence;
II. The Honorable Court of Appeals erred in declaring the real
estate mortgage valid;
III. The Honorable Court of Appeals erred in declaring,
without basis, that the loan contracted by husband Joe A.
Ros with respondent Philippine National Bank Laoag
redounded to the benefit of his family, aside from the fact
that such had not been raised by respondent in its appeal. 14]
The Courts Ruling
The petition has no merit. We affirm the ruling of the
appellate court.
The Civil Code was the applicable law at the time of the
mortgage. The subject property is thus considered part of
the conjugal partnership of gains. The pertinent articles of
the Civil Code provide:
Art. 153. The following are conjugal partnership property:

(1) That which is acquired by onerous title during the


marriage at the expense of the common fund, whether the
acquisition be for the partnership, or for only one of the
spouses;
(2) That which is obtained by the industry, or work or as
salary of the spouses, or of either of them;
(3) The fruits, rents or interest received or due during the
marriage, coming from the common property or from the
exclusive property of each spouse.
Art. 160. 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.
Art. 161. The conjugal partnership shall be liable for:
(1) All debts and obligations contracted by the husband
for the benefit of the conjugal partnership, and those
contracted by the wife, also for the same purpose, in the
cases where she may legally bind the partnership;
(2) Arrears or income due, during the marriage, from
obligations which constitute a charge upon property of
either spouse or of the partnership;
(3) Minor repairs or for mere preservation made during
the marriage upon the separate property of either the
husband or the wife; major repairs shall not be charged
to the partnership;
(4) Major or minor repairs upon the conjugal partnership
property;
(5) The maintenance of the family and the education of
the children of both husband and wife, and of legitimate
children of one of the spouses;
(6) Expenses to permit the spouses to complete a
professional, vocational or other course.
Art. 166. Unless the wife has been declared a non compos
mentis or a spendthrift, or is under civil interdiction or is
confined in a leprosarium, the husband cannot alienate or
encumber any real property of the conjugal partnership
without the wifes consent. If she refuses unreasonably to
give her consent, the court may compel her to grant the
same.
Art. 173. The wife may, during the marriage, and within ten
years from the transaction questioned, ask the courts for the
annulment of any contract of the husband entered into
without her consent, when such consent is required, or any
act or contract of the husband which tends to defraud her or
impair her interest in the conjugal partnership property.
Should the wife fail to exercise this right, she or her heirs
after the dissolution of the marriage may demand the value
of the property fraudulently alienated by the husband.
There is no doubt that the subject property was acquired
during Ros and Aguetes marriage. Ros and Aguete were
married on 16 January 1954, while the subject property was
acquired in 1968.15 There is also no doubt that Ros
encumbered the subject property when he mortgaged it for
P115,000.00 on 23 October 1974.16 PNB Laoag does not
doubt that Aguete, as evidenced by her signature,
consented to Ros mortgage to PNB of the subject property.
On the other hand, Aguete denies ever having consented to
the loan and also denies affixing her signature to the
mortgage and loan documents.
The husband cannot alienate or encumber any conjugal real
property without the consent, express or implied, of the wife.
Should the husband do so, then the contract is
voidable.17 Article 173 of the Civil Code allows Aguete to
question Ros encumbrance of the subject property.
However, the same article does not guarantee that the
courts will declare the annulment of the contract. Annulment
will be declared only upon a finding that the wife did not

give her consent. In the present case, we follow the


conclusion of the appellate court and rule that Aguete gave
her consent to Ros encumbrance of the subject property.

WHEREFORE, we DENY the petition. The Decision of the


Court of Appeals in CA-G.R. CV No. 76845 promulgated on
17 October 2005 is AFFIRMED. Costs against petitioners.

The documents disavowed by Aguete are acknowledged


before a notary public, hence they are public documents.
Every instrument duly acknowledged and certified as
provided by law may be presented in evidence without
further proof, the certificate of acknowledgment being prima
facie evidence of the execution of the instrument or
document involved.18 The execution of a document that has
been ratified before a notary public cannot be disproved by
the mere denial of the alleged signer.19 PNB was correct
when it stated that petitioners omission to present other
positive evidence to substantiate their claim of forgery was
fatal to petitioners cause.20Petitioners did not present any
corroborating witness, such as a handwriting expert, who
could authoritatively declare that Aguetes signatures were
really forged.

SO ORDERED.

A notarized document carries the evidentiary weight


conferred upon it with respect to its due execution, and it
has in its favor the presumption of regularity which may only
be rebutted by evidence so clear, strong and convincing as
to exclude all controversy as to the falsity of the certificate.
Absent such, the presumption must be upheld. The burden
of proof to overcome the presumption of due execution of a
notarial document lies on the one contesting the same.
Furthermore, an allegation of forgery must be proved by
clear and convincing evidence, and whoever alleges it has
the burden of proving the same.21]
Ros himself cannot bring action against PNB, for no one can
come before the courts with unclean hands.1avvphi1 In their
memorandum before the trial court, petitioners themselves
admitted that Ros forged Aguetes signatures.
Joe A. Ros in legal effect admitted in the complaint that the
signatures of his wife in the questioned documents are
forged, incriminating himself to criminal prosecution. If he
were alive today, he would be prosecuted for forgery. This
strengthens the testimony of his wife that her signatures on
the questioned documents are not hers.
In filing the complaint, it must have been a remorse of
conscience for having wronged his family; in forging the
signature of his wife on the questioned documents; in
squandering the P115,000.00 loan from the bank for himself,
resulting in the foreclosure of the conjugal property; eviction
of his family therefrom; and, exposure to public contempt,
embarassment and ridicule.22]
The application for loan shows that the loan would be used
exclusively "for additional working [capital] of buy & sell of
garlic & virginia tobacco."23 In her testimony, Aguete
confirmed that Ros engaged in such business, but claimed to
be unaware whether it prospered. Aguete was also aware of
loans contracted by Ros, but did not know where he "wasted
the money."24 Debts contracted by the husband for and in
the exercise of the industry or profession by which he
contributes to the support of the family cannot be deemed
to be his exclusive and private debts.25
If the husband himself is the principal obligor in the
contract, i.e., he directly received the money and services to
be used in or for his own business or his own profession, that
contract falls within the term "x x x x obligations for the
benefit of the conjugal partnership." Here, no actual benefit
may be proved. It is enough that the benefit to the family is
apparent at the signing of the contract. From the very nature
of the contract of loan or services, the family stands to
benefit from the loan facility or services to be rendered to
the business or profession of the husband. It is immaterial, if
in the end, his business or profession fails or does not
succeed. Simply stated, where the husband contracts
obligations on behalf of the family business, the law
presumes, and rightly so, that such obligation will redound
to the benefit of the conjugal partnership.26]
For this reason, we rule that Ros loan from PNB redounded
to the benefit of the conjugal partnership. Hence, the debt is
chargeable to the conjugal partnership.

G.R. No. L-60174 February 16, 1983


EDUARDO FELIPE, HERMOGENA V. FELIPE AND
VICENTE V. FELIPE, petitioners,
vs.
HEIRS OF MAXIMO ALDON, NAMELY: GIMENA
ALMOSARA, SOFIA ALDON, SALVADOR ALDON, AND
THE HONORABLE COURT OF APPEALS, respondents.
Romulo D. San Juan for petitioner.
Gerundino Castillejo for private respondent.

ABAD SANTOS, J.:


Maximo Aldon married Gimena Almosara in 1936. The
spouses bought several pieces of land sometime between
1948 and 1950. In 1960-62, the lands were divided into
three lots, 1370, 1371 and 1415 of the San Jacinto Public
Land Subdivision, San Jacinto, Masbate.
In 1951, Gimena Almosara sold the lots to the spouses
Eduardo Felipe and Hermogena V. Felipe. The sale was made
without the consent of her husband, Maximo.
On April 26, 1976, the heirs of Maximo Aldon, namely his
widow Gimena and their children Sofia and Salvador Aldon,
filed a complaint in the Court of First Instance of Masbate
against the Felipes. The complaint which was docketed as
Civil Case No. 2372 alleged that the plaintiffs were the
owners of Lots 1370, 1371 and 1415; that they had orally
mortgaged the same to the defendants; and an offer to
redeem the mortgage had been refused so they filed the
complaint in order to recover the three parcels of land.
The defendants asserted that they had acquired the lots
from the plaintiffs by purchase and subsequent delivery to
them. The trial court sustained the claim of the defendants
and rendered the following judgment:
a. declaring the defendants to be the lawful owners of the
property subject of the present litigation;
b. declaring the complaint in the present action to be
without merit and is therefore hereby ordered dismissed;
c. ordering the plaintiffs to pay to the defendants the
amount of P2,000.00 as reasonable attorney's fees and to
pay the costs of the suit.
The plaintiffs appealed the decision to the Court of Appeals
which rendered the following judgment:
PREMISES CONSIDERED, the decision appealed from is
hereby REVERSED and SET ASIDE, and a new one is
hereby RENDERED, ordering the defendants-appellees to
surrender the lots in question as well as the plaintiffs'appellants' muniments of title thereof to said plaintiffsappellants, to make an accounting of the produce derived
from the lands including expenses incurred since 1951,
and to solidarity turn over to the plaintiffs-appellants the
NET monetary value of the profits, after deducting the
sum of P1,800.00. No attorney's fees nor moral damages
are awarded for lack of any legal justification therefor. No.
costs.
The ratio of the judgment is stated in the following
paragraphs of the decision penned by Justice Edgardo L.
Paras with the concurrence of Justices Venicio Escolin and
Mariano A. Zosa:
One of the principal issues in the case involves the nature
of the aforementioned conveyance or transaction, with
appellants claiming the same to be an oral contract of
mortgage or antichresis, the redemption of which could be
done anytime upon repayment of the P1,800.00 involved

(incidentally the only thing written about the transaction is


the aforementioned receipt re the P1,800). Upon the other
hand, appellees claim that the transaction was one of
sale, accordingly, redemption was improper. The appellees
claim that plaintiffs never conveyed the property because
of a loan or mortgage or antichresis and that what really
transpired was the execution of a contract of sale thru a
private document designated as a 'Deed of Purchase and
Sale' (Exhibit 1), the execution having been made by
Gimena Almosara in favor of appellee Hermogena V.
Felipe.
After a study of this case, we have come to the conclusion
that the appellants are entitled to recover the ownership
of the lots in question. We so hold because although Exh.
1 concerning the sale made in 1951 of the disputed lots is,
in Our opinion, not a forgery the fact is that the sale made
by Gimena Almosara is invalid, having been executed
without the needed consent of her husband, the lots being
conjugal. Appellees' argument that this was an issue not
raised in the pleadings is baseless, considering the fact
that the complaint alleges that the parcels 'were
purchased by plaintiff Gimena Almosara and her late
husband Maximo Aldon' (the lots having been purchased
during the existence of the marriage, the same are
presumed conjugal) and inferentially, by force of law,
could not, be disposed of by a wife without her husband's
consent.
The defendants are now the appellants in this petition for
review. They invoke several grounds in seeking the reversal
of the decision of the Court of Appeals. One of the grounds is
factual in nature; petitioners claim that "respondent Court of
Appeals has found as a fact that the 'Deed of Purchase and
Sale' executed by respondent Gimena Almosara is not a
forgery and therefore its authenticity and due execution is
already beyond question." We cannot consider this ground
because as a rule only questions of law are reviewed in
proceedings under Rule 45 of the Rules of Court subject to
well-defined exceptions not present in the instant case.
The legal ground which deserves attention is the legal effect
of a sale of lands belonging to the conjugal partnership
made by the wife without the consent of the husband.
It is useful at this point to re-state some elementary rules:
The husband is the administrator of the conjugal
partnership. (Art. 165, Civil Code.) Subject to certain
exceptions, the husband cannot alienate or encumber any
real property of the conjugal partnership without the wife's
consent. (Art. 166, Idem.) And the wife cannot bind the
conjugal partnership without the husband's consent, except
in cases provided by law. (Art. 172, Idem.)
In the instant case, Gimena, the wife, sold lands belonging to
the conjugal partnership without the consent of the husband
and the sale is not covered by the phrase "except in cases
provided by law." The Court of Appeals described the sale as
"invalid" - a term which is imprecise when used in relation to
contracts because the Civil Code uses specific names in
designating defective contracts, namely: rescissible (Arts.
1380 et seq.), voidable(Arts. 1390 et
seq.), unenforceable (Arts. 1403, et seq.), and void or
inexistent (Arts. 1409 et seq.)
The sale made by Gimena is certainly a defective contract
but of what category? The answer: it is a voidable contract.
According to Art. 1390 of the Civil Code, among the voidable
contracts are "[T]hose where one of the parties is incapable
of giving consent to the contract." (Par. 1.) In the instant
case-Gimena had no capacity to give consent to the contract
of sale. The capacity to give consent belonged not even to
the husband alone but to both spouses.
The view that the contract made by Gimena is a voidable
contract is supported by the legal provision that contracts
entered by the husband without the consent of the wife
when such consent is required, are annullable at her
instance during the marriage and within ten years from the
transaction questioned. (Art. 173, Civil Code.)

Gimena's contract is not rescissible for in such contract all


the essential elements are untainted but Gimena's consent
was tainted. Neither can the contract be classified as
unenforceable because it does not fit any of those described
in Art. 1403 of the Civil Code. And finally, the contract
cannot be void or inexistent because it is not one of those
mentioned in Art. 1409 of the Civil Code. By process of
elimination, it must perforce be a voidable contract.

solidarity pay their value to Sofia and Salvador Aldon; costs


against the petitioners.
SO ORDERED.

G.R. No. L-45418 October 30, 1980


The voidable contract of Gimena was subject to annulment
by her husband only during the marriage because he was
the victim who had an interest in the contract. Gimena, who
was the party responsible for the defect, could not ask for its
annulment. Their children could not likewise seek the
annulment of the contract while the marriage subsisted
because they merely had an inchoate right to the lands sold.
The termination of the marriage and the dissolution of the
conjugal partnership by the death of Maximo Aldon did not
improve the situation of Gimena. What she could not do
during the marriage, she could not do thereafter.
The case of Sofia and Salvador Aldon is different. After the
death of Maximo they acquired the right to question the
defective contract insofar as it deprived them of their
hereditary rights in their father's share in the lands. The
father's share is one-half (1/2) of the lands and their share is
two-thirds (2/3) thereof, one-third (1/3) pertaining to the
widow.
The petitioners have been in possession of the lands since
1951. It was only in 1976 when the respondents filed action
to recover the lands. In the meantime, Maximo Aldon died.
Two questions come to mind, namely: (1) Have the
petitioners acquired the lands by acquisitive prescription?
(2) Is the right of action of Sofia and Salvador Aldon barred
by the statute of limitations?
Anent the first question, We quote with approval the
following statement of the Court of Appeals:
We would like to state further that appellees [petitioners
herein] could not have acquired ownership of the lots by
prescription in view of what we regard as their bad faith.
This bad faith is revealed by testimony to the effect that
defendant-appellee Vicente V. Felipe (son of appellees
Eduardo Felipe and Hermogena V. Felipe) attempted in
December 1970 to have Gimena Almosara sign a readymade document purporting to self the disputed lots to
the appellees. This actuation clearly indicated that
the appellees knew the lots did not still belong to
them, otherwise, why were they interested in a
document of sale in their favor? Again why did Vicente V.
Felipe tell Gimena that the purpose of the document was
to obtain Gimena's consent to the construction of an
irrigation pump on the lots in question? The only possible
reason for purporting to obtain such consent is that the
appellees knew the lots were not theirs. Why was there
an attempted improvement (the irrigation tank) only in
1970? Why was the declaration of property made only in
1974? Why were no attempts made to obtain the
husband's signature, despite the fact that Gimena and
Hermogena were close relatives? An these indicate the
bad faith of the appellees. Now then, even if we were to
consider appellees' possession in bad faith as a
possession in the concept of owners, this possession at
the earliest started in 1951, hence the period for
extraordinary prescription (30 years) had not yet lapsed
when the present action was instituted on April 26, 1976.
As to the second question, the children's cause of action
accrued from the death of their father in 1959 and they had
thirty (30) years to institute it (Art. 1141, Civil Code.) They
filed action in 1976 which is well within the period.
WHEREFORE, the decision of the Court of Appeals is hereby
modified. Judgment is entered awarding to Sofia and
Salvador Aldon their shares of the lands as stated in the
body of this decision; and the petitioners as possessors in
bad faith shall make an accounting of the fruits
corresponding to the share aforementioned from 1959 and

TEOFISTA P. TINITIGAN, EFREN TINITIGAN, ELSA


TINITIGAN and SEVERINO TINITIGAN, JR., petitioners,
vs.
SEVERINO TINITIGAN, SR. and THE COURT OF
APPEALS, respondents.
G.R. No. L-45574. October 30, 1980.*
PENTEL MERCHANDISING CO., INC. and TEOFISTA
PAYURAN TINITIGAN, petitioners,
vs.
THE COURT OF APPEALS, HONORABLE PEDRO C.
NAVARRO, CHIU CHIN SIONG and SEVERINO TINITIGAN
SR., respondents.

MAKASIAR, J.:
Two petitions are herein filed to review on certiorari the
decision of the Court of Appeals dated June 1, 1976 in CAG.R. No. 05387- SP docketed as L-45418 and L-45574
respectively, affirming the order of respondent Judge Pedro
C. Navarro of the Court of First Instance of Rizal in Pasig,
Branch II in Civil Case No. 21277 dated September 29, 1975.
On March 25, 1975, petitioners Pentel Merchandising Co.,
Inc. (Pentel for short) and Teofista Payumo Tinitigan (Payuran
for short) entered into a contract of lease of a residential
house whereby for a term of four years Payumo shall lease
to Pentel the premises at 205 Loring St., Pasay City covered
by Transfer Certificate of Title No. 15923, at a rental of
P1,500.00 per month with option to buy the same within the
term of the lease for P350,000.00 [pp. 13-16, rec].
On April 22, 1975, Payumo and her three children, Efren,
Elsa, and Severino Jr., all surnamed Tinitigan, leased to
United Electronics Corporation a factory building together
with the portion of land on which it is erected covered by
Transfer Certificate of Title No. 160998 situated in Banwag,
Paraaque, Rizal (pp. 17-20, rec., L-45418).
In both transactions, the consent of Severino Tinitigan Sr.
(Tinitigan for short), husband of Payumo and private
responded herein, was not secured. Consequently, on May
22, 1975, Severino Tinitigan Sr., as conjugal partner and
shareholder of Molave Development Corporation which is a
family corporation filed a complaint captioned "Annulment of
Ownership and Contract of witness Pre-Injunction" in the
Court of First Instance of Rizal in Pasig, 7th Judicial District
(pp. 23-27, rec.). This case docketed Civil Case No. 21277
and which was assigned to Branch II presided by the
Honorable Judge Pedro C. Navarro principally sought to annul
the contract of lease executed by Payumo in favor of United
Electronics Corporation The property involved in this
contract is entirely different from that leased to Pentel with
option to buy.
The complaint, however, was later amended with leave of
court granted by order of August 20, 1975, to include in the
prayer the following:
... 2. to restrain the defendant-relatives of the plaintiff
from encumbering or disposing properties in the name
of the Molave Development Corporation or those in the
name of Severino Tinitigan Sr. and Teofista Payuran; ...
In the same order, the CFI of Rizal, Branch II enjoined
petitioner from doing any "act to dispose, mortgage or
otherwise encumber the properties described in paragraphs
7 and 8 of the complaint" and set the case for hearing on
the issuance of a preliminary injunction on September 5,

1975. Paragraphs 7 and 8 pertain to the factory building and


the land on which it is erected covered by TCT No. 160998
(p. 151, rec.).
At the hearing of the preliminary injunction the issue of the
contract of lease of lot covered by TCT 160998 which was
the main object of the complaint was settled amicably.
Severino Tinitigan Sr., however, on September 17, 1975,
filed a motion seeking judicial approval of sale of a twostorey residential house and a lot which are conjugal
properties located at 205 Loring St., Pasay City, covered by
TCT No. 15923 (pp. 28-34, rec.). The house is tenanted by
Quintin Lim Eng Seng (Quintin Lim for short) who is
President and General Manager of Pentel. Tinitigan contends
that the proposed sale of the property for P300,000.00 to
Quintin who was given priority right to purchase, was
necessary to pay outstanding conjugal obligations that were
overdue in the amount of P256,137.79 and to forestall the
foreclosure of mortgaged conjugal property. Earlier, the
same property had been leased by Payumo to Pentel with an
option to buy for P350,000.00.
On September 29, 1975, the CFI of Rizal, Branch II issued an
order granting Tinitigan "authority to sell the house and lot
at No. 205 Loring St., Pasay City covered by TCT No. 15923
in favor of Quintin Lim, if he is a Filipino citizen, for
P300,000.00" (pp. 35-37, rec.,).
An urgent motion for reconsideration was filed by Payumo
and children alleging among others that the sale would
result in substantial and tremendous losses because the
property sought to be sold is a suitable condominium and/or
hotel site and would, therefore, command a higher price (pp.
56-57, rec.).
On October 9, 1975, merely two days after the motion for
reconsideration of the September 29, 1975 order was filed in
the CFI of Rizal, Branch II, the wife Payumo filed against her
husband Tinitigan a complaint for legal separation and
dissolution of conjugal partnership, docketed as Civil Case
No. 4459-P before Branch XXVIII of the Court of First Instance
of Rizal at Pasay City presided by the Honorable Judge
Enrique A. Agana (pp. 17-21, rec.).
On October 29, 1975, the Pasay Court after noting that "the
parties had agreed to the continuation of the administration
of said conjugal properties by plaintiff (wife) Teofista P.
Tinitigan," appointed her administrative of the conjugal
properties subject to the following conditions:
1) that all and any disposition and/or encumbrance of the
real estate belonging to the conjugal partnership shall be
subject to the approval of the court;
2) that all rentals accruing from the properties in Angeles
Civil shall be collected by the defendant Severino
Tinitigan for his subsistence and support; and
3) that the disposition of the property located at Loring
St., Pasay City, shall be subject to the decision of the
Court of First Instance of Rizal, Branch II, Pasig, Rizal" [P.
22, rec.].
In Civil Case No. 21277 however, the CFI of Rizal, Branch II,
presided by respondent Judge issued an order denying
petitioners' motion for reconsideration of the September 29,
1975 order for lack of merit. Further, the court stated that
"the defendants (petitioners) have not even shown that
there are offers from other sources willing to buy the
property for more than P300.000.00 (p. 92, rec.)
On November 22, 1975, a notice of appeal was filed by
petitioners Payumo and children appealing the order of
November 3, 1975, it being allegedly final in nature in so far
as the disposition of the Pasay property is concerned and
there being no further issue left between the parties (pp. 7273, rec.).
By a deed of absolute sale dated January 16, 1976 (pp. 3844, rec.). the husband Tinitigan apparently sold for
P315,000.00 the Pasay property not to Quintin Lim as

contained in the order of the court in Civil Case No. 21277,


but to herein private respondent Chiu Chin Siong (Chiu for
short) who obtained a title thereto. Pursuantly, TCT No.
20031 was issued cancelling TCT No. 15923.
On February 23, 1976, a motion for the approval of the sale
to Chiu was filed by respondent Tinitigan in the CFI of Rizal,
Branch 11 (pp. 203-205, rec.).
On March 3, 1976, the said court issued an order approving
the sale executed by Severino Tinitigan Sr. in favor of Chiu
covering the parcel of land at 206 Loring St., San Rafael
District, Pasay City, for and in consideration of the sum of
Three Hundred Fifteen Thousand Pesos (P315,000.00) [pp.
206-207, rec.).
In a decision dated April 8, 1976, the same court denied the
appeal filed by petitioners Payumo and children on the
ground that the order appealed from is merely interlocutory
and cannot, therefore, be the subject of appeal.
Furthermore, it stated that "the sale in favor of Chiu Chin
Siong is a right pertaining to the plaintiff under Article 171 of
the Civil Code and the exercise cise of said right is justifiable
to relieve the rest of the conjugal properties from mortgage
obligations which are in danger of foreclosure" (p. 90, rec.).
On May 17, 1976, Payumo and children filed a petition for
certiorari with preliminary injunction against respondents
Tinitigan and the Honorable Pedro C. Navarro in the Court of
Appeals docketed as CA-G.R. 05387 assuming the orders of
respondent Judge and praying that a restraining order be
issued immediately enjoining respondent Severino Tinitigan
Sr. from selling or disposing of the disputed property and if
already sold to declare the sale null and void. Petitioners
likewise prayed that the order of the lower court dismissing
the appeal based on the grounds aforestated be declared a
nullity and that the appeal be given due course (pp. 45-49,
rec.).
On June 1, 1976, the Court of Appeals rendered its decision
upholding the orders of respondent Judge, particularly, the
orders of September 29, 1975 approving the sale of the
conjugal property in Pasay City, to quote:
The ground for opposition to the sale is a claim that the
property is a 'choice lot' within 'the tourist belt and its
potentials for a hotel or condominium site is very
promising' (Ibid. p. 4). It does sound good but too
abstruse to meet the immediate need for the liquidation
of a big conjugal liability and to avoid foreclosure and
loss of the properties mortgaged. Besides the sale to
liquidate the conjugal liability finds support from the
provisions of Articles 161 and 171 of the Civil Code. We
also see from the record before us that petitioner Teofista
P. Tinitigan has filed a complaint for legal separation and
dissolution of the conjugal partnership in the Court of
First Instance of Rizal, Branch XXVIII in Pasay City, under
Civil Case No. 4459-P. Private respondent agreed to the
appointment of petitioner Teofista P. Tinitigan as
administrative on certain conditions, which was approved
by the Court (Ibid., p. 30). One of these is that the
disposition of the property in question shall be subject to
the decision of the CFI of Rizal, Brapeh II in Pasig (Ibid., p.
30). As stated above, respondent Judge, presiding over
Branch II of the CFI of Rizal appellant proved the sale of
the conjugal property in question to liquidate certiorari
conjugal obligations (Ibid., pp- 17-19). ...
But the petitioners would, nevertheless compel us to
allow their appeal from the order dated September 29,
1975 approving the sale of the conjugal property in Pasay
City in order to liquidate certiorari conjugal obligations
(Ibid., p. 17) on the ground that the order dated
November 3, 1975 denying the motion for
reconsideration of the order dated September 29, 1975 is
already final (Ibid., p. 4, par. 14). But the respondent
Judge hold the questioned order as merely interlocutory
(Ibid., p. 57). We sustain the respondent Judge. ... The
fact that what was resolved by the respondent Court was
a mere motion for judicial authority to sell conjugal
property to liquidate certiorari conjugal obligations (Ibid.,
p. 8) indicates that the order granting the motion (Ibid.,
p. 17) is interlocutory. The rationale underlying the rule

that an interlocutory order is not appealable is basically


the avoidance of multiplicity of appeals in a single case
which could considerably delay the final disposition of
the case (People vs. Rodriguez 24 SCRA 163, 167) [pp.
93-97, rec.).
Thereafter, on July 19, 1976, private respondent Chiu filed
before the City Court, Branch III, at Pasay City, presided by
judge Pablo M. Malvar, a compliant for unlawful detainer
seeking an order to compel defendant therein, Quintin C.
Lim to vacate the premises in question (pp. 331-335, rec.).
On July 26, 1976, Quintin C. Lim filed his answer with motion
to dismiss denying that he 'was the lessee of the properly
and moving to dismiss the detainer action for lack of
jurisdiction, the issue of ownership not being capable of
decision without resolving the issue of ownership pending in
other courts (pp. 346-352, rec.).
On January 5, 1977, a petition for review docketed as L45418 was filed with this Court by Payumo and her three
children praying for the issuance of a writ of certiorari
directed to the Court of Appeals, and commanding it to send
to this Court for review and determination the records and
proceedings of Civil Case No. 21277 assigned to the CFI of
Rizal in Pasig, Branch II, presided by respondent Judge
Navarro. The main allegations of the petition are: lack of
jurisdiction on the part of the lower court since it did not
have judicial authority to authorize the sale of the conjugal
property in Civil Case No. 21277 considering that the
complaint in the said case referred to other properties to the
exclusion of the one authorized to be sold; and abuse of
discretion in dismissing the appeal since the order
authorizing the sale of the Loring property was not merely
interlocutory but one that was final and appealable.
On February 15, 1976, another petition was filed with this
Court, this time by Pentel and Payuran, against respondents
Court of Appeals. Honorable Pedro C. Navarro, Chiu Chin
Siong and Severino Tinitigan Sr. The petition, docketed as L45574, seeks to review on certiorari the decision of the
Court of Appeals in CA-G.R. No. 05387-SP dated June 1, 1976
and order of respondent Judge in Civil Case No. 21277 dated
September 29, 1975 on the ground that the said decision
and order are void.
Petitioners assigr. the following errors as grounds for the
allowance of writ, to wit:
(1) The questioned order authorizing Severino Tinitigan
Sr., to sell the property in question is void because
(a) Tinitigan Sr. had no authority to sell the premises,
they being under the administration of Payuran;
(b) Respondent Judge had not acquired jurisdiction over
the premises and could not grant Tinitigan authority to
sell them;
(c) The sale of the property was expressly authorized in
favor of Quintin Lim, not respondent Chiu;
(d) Pentel, whose President and General Manager is
Quintin Lim, had the option to buy the premises; and
(2) The Court of Appeals erred as a matter of law in
denying Payuran's petition to enjoin or set aside the sale
of the property here involved.
On February 23, 1977, this Court, after deliberating on the
petition filed in case G.R. No. L-45574 resolved without
giving due course thereto to require the respondents to
comment and to take up L-45574 with L-45418 since both
involve the same Court of Appeals decision (p. 107, rec.).
During the pendency of these petitions, the Pasay Court in
the legal separation case (Civil Case No. 4459-P), issued an
order dated August 29, 1977 dissolving the conjugal
partnership between Tinitigan and Payumo and approving
the partition of their properties pursuant to an agreement

(pp. 319-325, rec.). The Loring property was adjudicated in


favor of the wife Payuran.
In consequence, defendant-respondent filed a motion to
exclude TCT 15923 from the list of properties that should
belong to Payumo (pp. 208-210, rec.). An amended motion
was subsequently filed on October 25, 1977 praying that the
order of August 29, 1977 be amended in such a way that the
award of the Loring property be conditioned upon the final
outcome of the cases pending before this Court (pp. 326328, rec.).
Pursuant to said motion, the CFI of Rizal, Branch XXVIII,
Pasay City issued an order dated November 22, 1977 in part
stating that the "award of the Loring St., Pasay City property
under TCT No. 15923 in favor of the plaintiff in the order of
the court dated August 29, 1977 is understood to the subject
to the outcome of the cases now pending before the
Supreme Court in G.R. No. L-45418 and G.R. No. L-45574"
(pp. 329-330, rec.).
Notwithstanding these proceedings, the City Court of Pasay,
Branch III in the unlawful detainer case, presided by Judge
Malvar, issued a decision dated January 18, 1978 ordering
the defendant Quintin Lim and all persons claiming under
him to vacate the premises in question and to pay the
corresponding rentals thereof to the plaintiff Chiu at the rate
of P1,500.00 per month from January 16, 1976, until the
defendant and all persons claiming under him actually
vacate the said premises (pp. 367-371, rec.).
For this reason, Payuran, on February 14, 1978, filed a
motion for leave to apply for a writ of injunction to enjoin
execution of the decision of Judge Malvar in the unlawful
detainer case and to prohibit further proceedings therein
(pp. 259-273, rec.).
This Court, on February 22, 1978, issued a temporary
restraining order enjoining Judge Malvar from conducting
further proceedings and from executing the decision dated
January 18, 1978 (pp. 372-374, rec.).
The issues in both L-45418 and L-45574 related primarily to
the question of validity of the challenged order dated
September 29, 1975 issued by respondent Judge Navarro of
the CFI of Rizal, Branch II, in Pasig and the decision of
respondent Court of Appeals.
WE pursue our discussion on the merits of the case as
predicated on grounds raised in the assignment of errors.
Petitioners argue that the order authorizing Tinitigan to sell
the Loring property is void; firstly, because Tinitigan had no
authority to sell the premises, they being under the
administration of Payuran. This contention is without legal
basis. Article 165 of the New Civil Code decrees that "the
husband is the administrator of the conjugal partnership."
This is the general rule. Although Article 168 of the same
Code provides that "the wife may by express authority of the
husband embodied in a public instrument, administer the
conjugal partnership property" and scattered provisions in
the Code likewise speak of administration by the wife
pursuant to a judicial decree, the said provisions are not
applicable in the instant case. The judicial decree dated
October 29, 1975 appointing Payumo as administrative of
the conjugal partnership cannot be treated as an exception
because it was issued only after the CFI of Rizal, Branch II
had granted Tinitigan Sr. authority to sell the Loring property.
Besides, the appointment of Payumo as administrative was
not absolute as it was made subject to certain conditions
agreed upon by the parties. Although the claim by Payumo
that she was actually administering their conjugal properties
even prior to this controversy may have some color of truth
in it; legally, however, such fact is not enough to make her
administratix of the conjugal partnership for absent a public
instrument or a judicial decree, administration still pertains
to the husband as explicitly set forth in Article 165 (supra).
As held in the case of Ysasi vs. Fernandez (23 SCRA 1079,
1083 [June 25, 1968]).

The husband is the administrator of the conjugal


partnership. This is a right clearly granted to him by law.
More, the husband is the sole administrator. The wife is
not entitled as of right to joint administration. The
husband may even enforce right of possession against the
wife who has taken over the administration without his
consent. And the wife may be punished for contempt for
her refusal to deliver to him the conjugal assets. She may
be required to render full and complete accounting of such
properties.
Necessarily, the conclusion is that Tinitigan Sr. had not
ceased being the administrator of their conjugal properties
at the time the motion for judicial approval of sale was
granted. Being administrator, however, does not give him
outright authority to alienate or encumber conjugal assets.
This kind of transactions requires the express or implied
consent of the wife subject to certain exceptions. Thus,
Article 166 of the New Civil Code provides
Unless the wife has been declared a noncompos mentis or
a spendthrift, or is under civil interdiction or is confined in
a leprosarium the husband cannot alienate or encumber
any real property of the conjugal partnership without the
wife's consent. If she refuses unreasonably to give her
conscience the court may compel her to grant the same.
This article shall not apply to property acquired by the
conjugal partnership before the effective date of this Code
(Emphasis supplied).
This was precisely the reason why respondent Tinitigan Sr.
sought judicial approval of sale of the Loring property. The
filing of the said motion was, in fact, directed by a legal
provision since it became almost impossible for private
respondent to obtain his wife's consent to the sale which
transaction has not proven to be fraudulent. As the evidence
warrants, the sale was necessary to answer for a big
conjugal liability which might endanger the family's
economic standing. Actually, this is one instance where the
wife's consent is not required and impliedly, no judicial
intervention is necessary. According to Article 171 of the
New Civil Code, "the husband may dispose of the conjugal
partnership for the purposes specified in Articles 161 and
162." In general, these articles deal with the obligation of
the conjugal partnership. Specifically, Article 161, paragraph
1 provides that "the conjugal partnerships shall be liable for
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 case where she
may legally bind the partnership."
It must be noted that Payumo did not dispute the existence
of these conjugal liabilities. What she questioned, in reality,
was the propriety of the sale of the disputed property, which,
according to petitioners, has bright prospects of
development and market value appreciation in the future. It
was a 'choice lot' as termed by them. Nevertheless, the sale
was the surest and the most practical means resorted to by
respondent Tinitigan Sr. to save them from a serious
financial setback. This consideration cannot be sidestepped
by speculative allegations. Moreover, petitioners offer no
acceptable and practical solution to remedy this
contingency.
Secondly, petitioners contend that the questioned order is
void because respondent Judge had not acquired jurisdiction
over the premises and could not grant Tinitigan Sr. authority
to sell them. They would seem to capitalize on the fact that
the complaint in Civil Case No. 21277 particularly mentioned
only the lot covered by TCT No. 160998 leased to United
Electronics Corporation. Petitioners failed to note, however,
that in the amended complaint, respondents prayed among
others "to restrain the defendant-relatives of the plaintiff
from encumbering or disposing properties in the name of the
Molave Development Corporation or those in the name of
Severino Tinitigan Sr, and Teofista Payuran." This, in effect,
brings the Loring property by TCT No. 15923 within the
jurisdiction of the court which issued the order. Certainly, a
motion in relation thereto is but proper. Furthermore, it is
worth repeating that the said motion to seek judicial
approval of sale in lieu of marital consent amounts to
compliance with legal requirement delineated in Article

166, supra. The issuance of the order dated September 29,


1975 was, henceforth, pursuant to a validly acquired
jurisdiction, in keeping with a well-entrenched principle that
"jurisdiction over the subject matter is conferred by law. It is
determined by the allegations of the complaint, irrespective
of whether or no