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G.R. No. 163744. February 29, 2008.
Velasco, Jr., J.


1. Nicholson Pascual and Florencia Nevalga were married for nine years until their marriage
was declared null and void in 1994 on the ground of psychological incapacity on the part
of Nicholson—The dissolution of marriage carried with it the order of liquidation of their
conjugal partnership of gains.
2. During their marriage, Florencia bought from Sps. Clarito and Belen Sering a lot in
3. Sometime in 1997, Florencia obtained a loan of P58 million from Metrobank alongside
Sps. Norberto and Elvira Oliveros which was set to be paid in 1999—They secured the
obligation by executing several real estate mortgages on their properties, including the
property purchased from Sps. Sering; among the documents submitted by Florencia in
procuring the loan was a waiver that covers her conjugal properties with Nicholson which
the latter purportedly executed in her favor in 1995.
4. Florencia and Sps. Oliveros failed to pay their loan obligation, causing Metrobank to
initiate foreclosure proceedings and publish a notice of sale.
5. Upon hearing about said proceedings, Nicholson filed with the trial court a complaint to
declare the nullity of the mortgage of the property in question, alleging that the property
—which, to him, is still conjugal property—was mortgaged without his consent.
6. In response, Metrobank averred that said property was paraphernal as it was registered in
Florencia’s name.
7. Subsequently, the trial court ruled in favor of Nicholson, invalidating the mortgage and
finding said property to be conjugal because it was acquired during the existence of the
marriage of Nicholson and Florencia. Moreover, the trial court also concluded that since
said property is conjugal, it cannot be validly encumbered by Florencia without
Nicholson’s consent.
8. Metrobank, then, elevated the case to the Court of Appeals, invoking Art. 160 of the
Family Code by saying that for the presumption of conjugal ownership to operate,
evidence must be adduced to prove that not only was the property acquired during the
marriage but that conjugal funds were used for the acquisition—a burden which, to them,
Nicholson allegedly failed to discharge.
9. The Court of Appeals, notwithstanding, affirmed the trial court’s decision, stating that
Metrobank was not able to overthrow the presumptive conjugal nature of said property.


W/N Metrobank was correct in saying that before conjugal ownership could be legally
presumed, there must be a showing that the property was acquired during marriage using
conjugal funds

NO. The matter of the use of conjugal funds is not an essential requirement for the
presumption of conjugal ownership to arise—Only proof of acquisition during the marriage is
needed to raise the presumption that the property is conjugal.

*** It is not necessary to prove that the property is acquired with funds of the absolute
community (conjugal partnership). In fact, even when the manner in which the property is
acquired does not appear, the presumption applies. (Gesmundo, p. 297)