Bar Q and A #11 – Civil Law Bar Q and A

1.) Tim came into possession of an old map showing where a purported cache of gold bullion was hidden. Without any authority from the government Tim conducted a relentless search and finally found the treasure buried in a new river bed formerly part of a parcel of land owned by spouses Tirso and Tessie. The old river which used to cut through the land of Spouses Ursula and Urbito changed its course through natural causes. Suppose Tirso and Tessie were married on 2 August 1988 without executing any antenuptial agreement. One year after their marriage, Tirso while supervising the clearing of Tessie’s inherited land on the latter’s request, accidentally found the treasure not in the new river bed but on the property of Tessie. To whom shall the treasure belong?

Since Tirso and Tessie were married before the effectivity of the Family Code, their property relation is governed by conjugal partnership of gains. Under Art. 54 of the Civil Code, the share of the hidden treasure which the law awards to the finder or proprietor belongs to the conjugal partnership of gains. The one-half share pertaining to Tessie as owner o the land, and the one-half share pertaining to Tirso as finder of the treasure, belong to the conjugal partnership of gains.

2.) Gabby and Mila got married at Lourdes Church in Quezon City on July 10, 1990. Prior thereto, they executed a marriage settlement whereby they agreed on the regime of conjugal partnership of gains. The marriage settlement was registered in the Register of Deeds of Manila, where Mila is a resident. In 1992, they jointly acquired a residential house and lot, as well as a condominium unit in Makati. In 1995, they decided to change their property relations to the regime of complete separation of property. Mila consented, as she was then engaged in a lucrative business. The spouses then signed a private document dissolving their conjugal partnership and agreeing on a complete separation of property. Thereafter, Gabby acquired a mansion in Baguio City, and a 5- hectare agricultural land in Oriental Mindoro, which he registered exclusively in his name. In the year 2000, Mila's business venture failed, and her creditors sued her for P10,000,000.00. After obtaining a favorable judgment, the creditors sought to execute on the spouses' house and lot and condominium unit, as well as Gabby's mansion and agricultural land. a) Discuss the status of the first and the amended marriage settlements. b) Discuss the effects of the said settlements on the properties acquired by the spouses. c) What properties may be held answerable for Mila's obligations? Explain.

a) 1) The first marriage settlement was valid because it was in writing, signed by the parties and executed before the celebration of themarriage
2) The subsequent agreement of the parties was void as a modification of their marriage settlement. To be valid, the modification must be executed before the celebration of the marriage. The subsequent agreement of the parties did not effect a dissolution of their conjugal partnership and a separation of their properties because it was not approved by the court. To be valid, an agreement by the parties to dissolve their conjugal partnership and to separate their properties during the marriage has to be approved by the court.

b) Since the marriage settlement was binding between the parties, conjugal partnership of gains was the regime of their property relations. Under the regime of conjugal partnership of gains, all properties acquired by the spouses during the marriage, jointly or by either one of them, through their work or industry are conjugal. Therefore, the residential house and lot, and the condominium unit are conjugal having been jointly acquired by the couple during the marriage. Inasmuch as the subsequent agreement on dissolution of the conjugal partnership and separation of property was invalid, conjugal partnership subsisted between the parties. Therefore, the mansion and the agricultural land are also conjugal having been acquired by one of the spouses during the marriage.

c) The marriage settlement cannot prejudice third parties, such as the creditors, because it was not registered with the local civil registrar where the marriage was recorded. To bind third parties, the Family Code requires registration of the marriage settlement not only with the proper registers of deeds but also with the local civil registrar where the marriage was recorded. Hence, if the rules on conjugal partnership will prejudice the creditors, the rules on absolute community will be applied instead. However, insofar as debts contracted by one spouse without the consent of the other are concerned, the rule is the same for both conjugal partnership and absolute community. The partnership or community is liable for debts contracted by one spouse but only to the extent that it benefited the family. Therefore, if the debts contracted by Mila redounded to the benefit of the family, all the conjugal partnership properties are liable to pay them but only to the extent the family was benefited. The separate properties of Mila may be held answerable for Mila’s debts and obligations that did not redound to the benefit of the family.

3.) Bar candidates Patricio Mahigugmaon and Rowena Amor decided to marry each other before the last day of the 1991 Bar Examinations. They agreed to execute a Marriage Settlement. Rowena herself prepared the document in her own handwriting. They agreed on the following: (1) a conjugal partnership of gains; (2) each donates to the other fifty (50) percent of his/her present property; (3) Rowena shall administer the conjugal partnership property; and (4) neither may bring an action for the annulment or declaration of nullity of their marriage. Both signed the agreement in the presence of two witnesses. They did not, however, acknowledge it before a notary public. a) As to form, is the Marriage Settlement valid? May it be registered in the registry of property? If not, what steps must be taken to make it registrable? b) Are the stipulations valid? c) If the Marriage Settlement is valid as to form and the above stipulations are likewise valid, does it now follow that said Marriage Settlement is valid and enforceable?

a) Yes, it is valid as to form because it is in writing. However, it cannot be registered in the registry of property because it is not a public document. To make it registrable, it must be reformed and has to be notarized.

b) Stipulations 1 and 3 are valid because they are not contrary to law. Stipulation 4 is void because it is contrary to law. Stipulation 2 is valid up to 1/5 of their respective present properties by void as to the excess. (Art. 84, Family Code)

c) No, on September 15, 1991, the marriage settlement is not yet valid and enforceable until the celebration of the marriage, to take place before the last day of the 1991 Bar Examinations.

4.) May succession be conferred by contracts or acts inter vivos?

Under Art. 84 of the Family Code amending Art. 130 of the Civil Code, contractual succession is no longer possible since the law now requires that donations of future property be governed by the provisions on the testamentary succession and formalities of wills.

5.) Paulita left the conjugal home because of the excessive drinking of her husband, Alberto. Paulita, out of her own endeavor, was able to buy a parcel of land which she was able to register under her name with the addendum “widow.” She also acquired stocks in a listed corporation registered in her name. Paulita sold the parcel of land to Rafael, who first examined the original of the transfer certificate of title. 1) Has Alberto the right to share in the shares of stock acquired by Paulita? 2) Can Alberto recover the land from Rafael?

1) a) Yes. The Family Code provides that all property acquired during the marriage, whether the acquisition appears to have been made, contracted or registered in the community property unless the contrary is proved.

b) Yes. The shares are presumed to be absolute community property having been acquired during the marriage despite the fact that those shares were registered only in her name. Alberto’s right to claim his share will only arise, however, at dissolution.

c) The presumption is still that the shares of stock are owned in common. Hence, they will form part of the absolute community or the conjugal partnership depending on what the property regime is.

d) Since Paulita acquired the shares of stock by onerous title during the marriage, these are part of the conjugal or absolute community property, as the case may be, or after the effectivity of the Family Code. Her physical separation from her husband did not dissolve the community of property. Hence, the husband has a right to share in the shares of stock.

2) a) Under a community of property,whether absolute or relative, the disposition of property belonging to such community is void if done by just one spouse without the consent of the other or authority of the proper court. However, the land was registered in the name of Paulita as “widow.” Hence, the buyer has the right to rely upon what appears in the record of the Register of Deeds and should, consequently, be protected. Alberto cannot recover the land from Rafael but would have the right of recourse against his wife.

b) The parcel of land is absolute community property having been acquired during the marriage and through Paulita’s industry despite the registration being only in the name of Paulita. The land being community property, its sale to Rafael without the consent of Alberto is void. However, since the land is registered in the name of Paulita as widow, there is nothing in the title which would raise a suspicion for Rafael to make inquiry. He, therefore, is an innocent purchaser for value from whom the land may no longer be recovered.

c) The parcel of land is absolute community property having been acquired during the marriage and through Paulita’s industry despite registration only in the name of Paulita. The land being community property, its sale to Rafael without the consent of Alberto is void.

6.) Luis and Rizza, both 26 years of age and single, live exclusively with each other as husband and wife without the benefit of marriage. Luis is gainfully employed. Rizza is not employed, stays at home, and takes charge of the household. After living together for a little over twenty years, Luis was able to save from his salary earnings during that period the amout of P200,000.00 presently deposited in a bank. A house and lot worth P500,000.00 used by the common-law spouses to purchase the property, P200,000.00 had come from the sale of palay harvested from the hacienda owned by Luis and P300,000.00 from the rentals of a building belonging to Rizza. In fine, the sum of P500,000.00 had been part of the fruits received during the period of cohabitation from their separate property. A car worth P100,000.00, being used by the common-law spouses, was donated just months ago to Rizza by her parents. Luis and Rizza now decide to terminate their cohabitation, and they ask you to give them your legal advice on the following: a) How, under the law, should the bank deposit of P200,000.00, the house and lot valued at P500,000.00 and the car worth P100,000.00 be allocated to them? b) What would your answer be (to the above question) had Luis and Rizza been living together all the time, i.e., since twenty years ago, under a valid marriage?

a) Art. 147 of the Family Code provides in part that when a man and a woman who are capacitated to marry each other, live exclusively with each other as husband and wife without the benefit of marriage or under a void marriage, their wages and salaries shall be owned by them through their work or industry shall be governed by the rules of co-ownership. In the absence of proof to the contrary, properties acquired while they lived together shall be presumed to have been obtained by their joint efforts, work or industry, and shall be owned by them in equal shares. A party who did not participate in the acquisition by the other party of any property shall be deemed to have contributed jointly in the acquisition thereof if the former’s efforts consisted in the care and maintenance of the familyand of thehousehold.

Thus:
1. The wages and salaries of Luis in the amount of P200,000.00 shall be divided equally between Luis and Rizza.
2. The house and lot valued at P500,000.00 having been acquired by both of them through work or industry shall be divided between them in proportion to their respective contribution in consonance with the rules on co-ownership. Hence, Luis gets 2/5 while Rizza gets 3/5 of P500,000.00.
3. The car worth P100,000.00 shall be exclusively owned by Rizza, the same having been donated to her by her parents.

b) The property relations between Luis and Rizza, their marriage having been celebrated 20 years ago (under the Civil Code) shall be governed by the conjugal partnership of gains, under which the husband and wife place in a common fund the proceeds, products, fruits and income from their separate properties and those acquired by either or both spouses through their efforts of by chance, and upon dissolution of the marriage or of the partnership, the net gains or benefits obtained by either or both spouse shall be divided equally between them. (Art. 142, CivilCode)

Thus:

1. The salary of Luis deposited in the bank in the amount of P200,000.00 and the house and lot valued at P500,000.00 shall be divided equally between Luis and Rizza.
2. However, the car worth P100,000.00 donated to Rizza by her parents shall be considered to her own paraphernal property, having been acquired by lucrative title. (par. 2, Art. 148, Civil Code)

7.) In 1970, Bob and Issa got married without executing a marriage settlement. In 1975, Bob inherited from his father a residential lot upon which, in 1981, he constructed a two- room bungalow with savings from his own earnings. At that time, the lot was worth P800, 000.00 while the house, when finished cost P600,000.00. In 1989 Bob died, survived only by his wife, Issa and his mother, Sofia. Assuming that the relative values of both assets remained at the same proportion: 1. State whether Sofia can rightfully claim that the house and lot are not conjugal but exclusive property of her deceased son. 2. Will your answer be the same if Bob died before August 3, 1988?

Since Bob and Sofia got married in 1970, then the law that governs is the New Civil Code, in which case, the property relations that should be applied as regards the property of the spouses is the system of relative community or conjugal partnership of (Art. 119) By conjugal partnership of gains, the husband and the wife place in a common fund the fruits of their separate property and the income from their work or industry. (Art. 142) In this instance, the lot inherited by Bob in 1975 is his own separate property, he having acquired the same by lucrative title. (Art. 148,par. 2) However, the house constructed from his own savings in 1981 during the subsistence of his marriage with Issa is conjugal property and not exclusive property in accordance with the principle of "reverse accession" provided for in Art. 158 of the Civil Code.
Yes, the answer would still be the Since Bob and Issa contracted their marriage way back in 1970, then the property relations that will govern is still the relative community or conjugal partnership of gains. (Art.119) It will not matter if Bob died before or after August 3, 1988 (effectivity date of the Family Code), what matters is the date when the marriage was contracted. As Bob and Issa contracted their marriage way back in 1970, the property relation that governs them is still the conjugal partnership of gains. (Art. 158)

8.) Adam, a building contractor, was engaged by Blas to construct a house on a lot which he (Blas) owns. While digging on the lot in order to lay down the foundation of the house, Adam hit a very hard object. It turned out to be the vault of the old Banco de las Islas Filipinas. Using a detonation device, Adam was able to open the vault containing old notes and coins which were in circulation during the Spanish era. While the notes and coins are no longer legal tender, they were valued at P100 million because of their historical value and the coins silver nickel content. The following filed legal claims over the notes and coins: i. Adam, as finder; ii. Blas, as owner of the property where they were found; iii. Bank of the Philippine Islands, as successor-in-interest of the owner of the vault; and iv. The Philippine Government because of their historical value. Assuming that either or both Adam and Blas are adjudged as owners, will the notes and coins be deemed part of their absolute community or conjugal partnership of gains with their respective spouses?

Yes. The hidden treasure will be part of the absolute community or conjugal property of the respective marriages. (Arts 91, 93 and 106, Family Code)

9.) For five years since 1989, Tony, a bank vice-president, and Susan, an entertainer, lived together as husband and wife without the benefit of marriage although they were capacitated to marry each other. Since Tony's salary was more than enough for their needs, Susan stopped working and merely "kept house." During that period, Tony was able to buy a lot and house in a plush subdivision. However, after five years, Tony and Susan decided to separate. a) Who will be entitled to the house and lot? b) Would it make any difference if Tony could not marry Susan because he was previously married to Alice from whom he is legally separated?

a) Tony and Susan are entitled to the house and lot as co-owners in equal shares. Under Article 147 of the Family Code, when a man and a woman who are capacitated to marry each other lived exclusively with each other as husband and wife, the property acquired during their cohabitation are presumed to have been obtained by their joint efforts, work or industry and shall be owned by them in equal shares. This is true even though the efforts of one of them consisted merely in his or her care and maintenance of the family and of the household.

b) Yes, it would make a difference. Under Article 148 of the Family Code, when the parties to the cohabitation could not marry each other because of an impediment, only those properties acquired by both of them through their actual joint contribution of money, property, or industry shall be owned by them in common in proportion to their respective contributions. The efforts of one of the parties in maintaining the family and household are not considered adequate contribution in the acquisition of the properties. Since Susan did not contribute to the acquisition of the house and lot, she has no share therein. If Tony cohabited with Susan after his legal separation from Alice, the house and lot is his exclusive property. If he cohabited with Susan before his legal separation from Alice, the house and lot belongs to his community or partnership with Alice.

10.) In December 2000, Michael and Anna, after obtaining a valid marriage license, went to the Office of the Mayor of Urbano, Bulacan, to get married. The Mayor was not there, but the Mayor’s secretary asked Michael and Anna and their witnesses to fill up and sign the required marriage contract forms. The secretary then told them to wait, and went out to look for the Mayor who was attending a wedding in a neighboring municipality. When the secretary caught up with the Mayor at the wedding reception, she showed him the marriage contract forms and told him that the couple and their witnesses were waiting in his office. The Mayor forthwith signed all the copies of the marriage contract, gave them to the secretary who returned to the Mayor’s office. She then gave copies of the marriage contract to the parties, and told Michael and Anna that they were already married. Thereafter, the couple lived together as husband and wife, and had three sons. What governs the properties acquired by the couple? Explain.

The marriage being void, the property relationship that governed their union is special co-ownership under Article 147 of the Family Code. This is on the assumption that there was no impediment for them to validly marry each other.