GOTIA v.

CAMPUS-RUEDA
FACTS: 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. Gotia filed a complaint against the
respondent for support outside the conjugal home.
It was alleged that her husband demanded her to
perform unchaste and lascivious acts on his genital
organs. Gotia refused to perform any act other than
legal and valid cohabitation. Which just refusals of
the plaintiff exasperated the defendant and induce
him to maltreat her by word and deed and inflict
injuries upon her. She was obliged to leave the
conjugal abode and take refuge in the home of her
parents. The trial court ruled in favor of the
respondent and stated Gotia could not claim for
support from her husband. Gotia filed a motion for
review.
ISSUE: Whether or not Gotia can claim for support
from her husband.
HELD: Yes. The law provides that the husband is
obliged to support his wife but this law is not
absolute. In the case at bar, the wife was forced to
leave due to the maltreatment of her husband.
Thus, she can claim for support from her husband.
_______
ARROYO v. VASQUEZ
FACTS: Mariano B. Arroyo and Dolores C.
Vasquez de Arroyo were united in the bonds of
wedlock by marriage in 1910. They lived together
as man and wife in the city of Iloilo but on July 4,
1920, Dolores went away from their common home
with the intention of living separate from Mariano.
An action was initiated by Mariano for the
resumption of martial relations compelling
defendant to return to their marital home and live
with him as a dutiful wife. However, defendant
claimed that she left without consent due to the
cruel treatment on the part of her husband. She in
turn prayed for (1) a decree of separation, (2) a
liquidation of the conjugal partnership and (3) an
allowance for counsel fees and permanent
separate maintenance. 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.

ISSUE: WON the courts can compel the spouse to

cohabit with each other.
HELD: No. Upon examination of the authorities,
they are convinced that it is not within the province
of the courts of our country to attempt to compel
one of the spouses to cohabit with, and render
conjugal rights to, the other. However, where the
property rights of one of the pair are invaled, an
action for restitution of such right can be
maintained.
The courts are unable to hold that plaintiff is entitled
to unconditional and absolute order for the return of
the wife to the marital domicile, 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. It is declared
that defendant 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.
_______
VALDEZ v. COURT OF APPEALS
Facts: Carlos Valdez, Sr. and Josefina de Leon
Valdez were the owners of a parcel of land with an
area of 24,725 square meters located in the
commercial district of Isulan, Sultan Kudarat. When
Carlos Valdez, Sr. died intestate on March 26,
1966, he was survived by Josefina and their
children, including Carlos Valdez, Jr., a practicing
lawyer.
On December 28, 1978, Josefina caused the
subdivision survey of the property into eight (8) lots,
i.e., Lots Nos. 3-A to 3-H, all fronting the national
road. To enhance the value of the property, she
decided to sell a portion thereof to Jose Lagon, a
successful businessman in Sultan Kudarat who
owned a construction firm as well as real estate
and business enterprises: the Lagon Enterprises
and the Rural Bank of Isulan. He was also one of
the clients of her son, Carlos, Jr., a practicing
lawyer.
On May 1, 1979, Josefina executed a Special
Power of Attorney authorizing her son, Carlos, Jr. to
sell a portion of Lot No. 3-C and Lot. No. 3-D to
Lagon. The lots subject of the sale had an area of
4,094 square meters, with a frontage of 64.3
square meters. Part of the consideration of the

transaction was the condition that Lagon cause the

transfer of the Rural Bank of Isulan to the subject
property and construct a commercial building
beside the bank. On May 9, 1979, Josefina,
through her son and attorney-in-fact, Carlos, Jr.,
executed a Deed of Absolute Sale of a portion of
Lot No. 3 with a frontage of 64.3 square meters.
However, the condition imposed by Josefina was
not incorporated in the deed; what was appended
thereto was the Special Power of Attorney executed
by Josefina. It was indicated in the said deed that
the property was to be sold forP80, 000 cash and
that Lagon had already paid the said amount to
Carlos, Jr. In reality, however, Lagon purchased the
4,094-square-meter property at P40.00 per square
meter, or for the amount of P163, 760 inclusive of
Carlos, Jr.s personal account to Lagon in the
amount of P73,760. Lagon had not yet remitted to
Josefina the said amount of P163, 760.
4

Carlos, Jr. prepared an Affidavit dated April 27,

1981 signed by Lagon, where the latter undertook
to transfer the Rural Bank of Isulan to the property
and construct a commercial building thereon, to be
in full operation within a period of five (5) years
from May 9, 1979, the date of the deed of absolute
sale, or until May 9, 1984, as part of the condition
of the sale; and that if Lagon failed to do so, the
deed of absolute sale shall be declared null and
void without need of demand therefor. Lagon also
made it clear in the said affidavit that the
consideration of the said Deed of Absolute Sale
was not only the P80,000.00 purchase price, but
also that the subject property be commercialized.
9

10

11

However, Lagon failed to start the construction of a

commercial building and to transfer the rural bank
thereon; he, likewise, failed to pay the balance of
the purchase price amounting to P61, 880.00.
Consequently, Josefina and Carlos, Jr. refused to
deliver to Lagon a torrens title over the purchased
property. On September 4, 1981, Carlos, Jr. wrote
Lagon demanding the payment of P61, 800.00
within ten days from notice thereof, otherwise, the
sale would be considered rescinded. Still, Lagon
failed to pay or even respond to the letter. Carlos,
Jr. again wrote Lagon on September 25, 1981, and
this time proposed the reduction of the area of the
property subject of the sale to correspond to the
payment so far made by Lagon in the total amount
of P90, 676.00. There was no response from
Lagon.
12

13

On December 31, 1982, Josefina and her children

executed a deed of extrajudicial settlement of the
estate of Carlos Valdez, Sr. in which the heirs

waived all their rights over the estate in favor of

their mother, Josefina.
In the meantime, in August 1987, a question
ensued in connection with Lagons failure to pay
the balance of the purchase price of the property, to
cause the construction of a commercial building
and the transfer of the Rural Bank of Isulan to Lot
No. 3, as undertaken by him in his Affidavit dated
April 27, 1981. As a reminder, Carlos, Jr. furnished
Lagon with a machine copy of the said affidavit on
August 12, 1987. On August 13, 1987, Lagons
counsel, Atty. Ernesto I. Catedral, wrote Carlos, Jr.,
pointing out that he had earlier sought Lagons
consent for the construction of the PCIB Branch in
Lot No. 3. Catedral posited that by consenting to
the sale of the property to PCIB and the
construction thereon of its branch office, Lagon
thereby substantially complied with his undertaking
under the deed of absolute sale. The lawyer asked
Carlos, Jr. to set a conference to thresh out
possibilities of an amicable settlement of the matter.
On August 4, 1988, Josefina executed a real estate
mortgage over Lot No. 3-C-3 covered by TCT No.
18818 in favor of the Development Bank of the
Philippines (DBP) as security for a loan of
P150,000.00. Josefina executed a deed of
absolute sale over Lot No. 3-C-1 in favor of her
son, Carlos, Jr. on February 21, 1989. The Register
of Deeds thereafter issued TCT No. 21943 in the
latters name on February 28, 1989. In the
meantime, in 1984, Carlos, Jr. had an edifice
constructed on the property where he put up his
law office, a nipa hut behind the PCIB branch, the
Ivy Pharmacy, the "K House" and the headquarters
of the Nationalista Party.
31

32

33

On September 24, 1990, Lagon filed a Complaint

against Josefina, and Carlos, Jr., in his capacity as
attorney-in-fact
of
Josefina,
for
specific
performance and damages with a prayer for a
temporary restraining order and writ of preliminary
injunction.
The RTC ruled in favour of Valdez
CA reversed the ruling of RTC in favour of Lagon
ISSUE:
Won the subject property is the exclusive Property
of Josefina de Leon Valdez?(PERSONS)
Won the contract entered by the parties is a
contract of sale or a contract to sell?
HELD:
1.
The Subject Property is the Exclusive
Property of Josefina de Leon Valdez
We note that TCT No. T-19529 (T-1902) covering
the property was issued on August 18, 1967, during

the marriage of the Spouses Carlos Valdez, Sr. and

petitioner Josefina, under the name "Josefina L.
Valdez married to Carlos Valdez, Sr." The issuance
of the title in the name solely of one spouse is not
determinative of the conjugal nature of the property,
since there is no showing that it was acquired
during the marriage of the Spouses Carlos Valdez,
Sr. and Josefina L. Valdez. The presumption under
Article 160 of the New Civil Code, that property
acquired during marriage is conjugal, does not
apply where there is no showing as to when the
property alleged to be conjugal was acquired. The
presumption cannot prevail when the title is in the
name of only one spouse and the rights of innocent
third parties are involved. Moreover, when the
property is registered in the name of only one
spouse and there is no showing as to when the
property was acquired by same spouse, this is an
indication that the property belongs exclusively to
the said spouse.
In this case, there is no evidence to indicate when
the property was acquired by petitioner Josefina.
Thus, we agree with petitioner Josefinas
declaration in the deed of absolute sale she
executed in favor of the respondent that she was
the absolute and sole owner of the property. We
are convinced that the declaration in the deed of
extrajudicial settlement of the estate of the late
Carlos Valdez, Sr., that the property formed part of
his estate and that his children waived their rights
and claims over the property in favor of their
mother, was done merely to facilitate the issuance
of a torrens title over the property in petitioner
Josefinas name with her marital status as widow.
2.
Petitioner Josefina Valdez and the
Respondent entered into a Contract of Sale over
the Subject Property
The deed is one of sale, not a contract to sell. The
deed specifically states that the property is sold and
delivered to the respondent as vendee. Petitioner
Josefina even warranted the peaceful possession
and ownership of the respondent over the property
subject of the transaction. She did not reserve the
ownership over the property, as well as any right to
unilaterally rescind the contract. There has been,
by the execution of the said deed, a constructive
delivery of the property to the respondent; hence,
the latter acquired ownership over the same. Upon
payment of the purchase price, petitioner Josefina
was obliged to deliver the torrens title over the
property to and under the name of the respondent
as the new owner and place him, as vendee, in
actual possession thereof; otherwise, the failure or
inability to do so constitutes a breach of the
contract sufficient to justify its rescission.

However, we rule that the deed of absolute sale

was unenforceable as of the date of its execution,
May 9, 1979. This is so, because under the Special
Power of Attorney petitioner Josefina executed in
favor of her son, petitioner Carlos, Jr., the latter was
authorized to sell the property on cash basis only;
petitioner
Josefina
likewise
required
the
construction of a commercial building and the
transfer of the Rural Bank of Isulan, as part of the
consideration of the sale to be incorporated in the
said deed as part of the respondents obligation as
vendee. Clearly, petitioner Carlos, Jr. acted beyond
the scope of his authority when he executed the
deed of absolute sale in contravention of petitioner
Josefinas express instructions. Worse, he falsely
declared in the said deed that the purchase price
was P80,000.00 and that he had already received
the said amount, when, in fact, the property was
sold for P40.00 per square meters, or a total of
P163,760.00, and that as of May 9, 1979, he had
not yet received the said amount. Under Article
1317 of the New Civil Code, contracts executed by
agents who have acted beyond their powers are
unenforceable unless ratified by the principal either
expressly or impliedly:
Art. 1317. No one may contract in the name of
another without being authorized by the latter, or
unless he has by law a right to represent him.
A contract entered into in the name of another by
one who has no authority or legal representation, or
who has acted beyond his powers, shall be
unenforceable, unless it is ratified, expressly or
impliedly, by the person on whose behalf it has
been executed, before it is revoked by the other
contracting party. Thus, the effectivity of the
contract of sale in the case at bar depends upon
the ratification thereof by petitioner Josefina as
principal. If she ratifies the deed, the sale is
validated from the moment of its commencement,
and not merely from the time of its ratification. In
such case, she can no longer maintain an action to
annul the same based upon defects relating to its
original validity. We find that petitioner Josefina
ratified the said deed when she received, through
her son and attorney-in-fact petitioner Carlos, Jr.,
partial payments of the purchase price of the
property from the respondent on April 21, 1981.
Such ratification retroacted to May 9, 1979, the
date when petitioner Josefina, through her attorneyin-fact, executed the deed of sale covering the
subject property in favor of the respondent.
Moreover, we rule that the respondent agreed on to
transfer the Rural Bank of Isulan to the subject
property, and to cause the construction of a
commercial building within five (5) years reckoned

from May 9, 1979 or until May 9, 1984, as

evidenced by his affidavit.
It bears stressing that petitioner Josefina
specifically and unequivocally required in the
special power of attorney, as part of the
consideration of the sale of the property to the
respondent, the latters obligation to construct a
new and fully operational commercial building and
transfer the Rural Bank of Isulan to the property.
Had she agreed to modify the Special Power of
Attorney she executed in favor of her son, petitioner
Carlos, Jr., for sure, she would have executed a
document to that effect. She did not do so.
Petitioner Carlos, Jr. could not lawfully bind
petitioner Josefina thereon because he was not so
authorized to enter into such an agreement with the
respondent; neither can such authority be implied
from the Special Power of Attorney petitioner
Josefina executed in favor of her son, petitioner
Carlos, Jr.
In sum, then, the respondent had no cause for
specific performance against the petitioners.
However, the petitioners are obliged to refund to
the respondent the latters partial payments for the
subject property
_______
AGAPAY v. PALANG
FACTS: Miguel Palang contracted marriage with
Carlina in Pangasinan on 1949. He left to work in
Hawaii a few months after the wedding. Their only
child Herminia was born in May 1950. The trial
court found evident that as early as 1957, Miguel
attempted to Divorce Carlina in Hawaii for several
times. When he returned for good in 1972, he
refused to live with Carlina and stayed alone in a
house in Pozzorubio Pangasinan.
The 63 year old Miguel contracted a subsequent
marriage with 19 year old Erlinda Agapay, herein
petitioner. 2 months earlier, they jointly purchased a
parcel of agricultural land located at Binalonan
Pangasinan. A house and lot in the same place was
likewise purchased. On the other hand, Miguel and
Carlina executed a Deed of Donation as a form of
compromise agreement and agreed to donate their
conjugal property consisting of 6 parcels of land to
their child Herminia.
Miguel and Erlindas cohabitation produced a son
named Kristopher. In 1979, they were convicted of
concubinage upon Carlinas complaint. 2 years
later, Miguel died. Carlina and her daughter
instituted this case for recovery of ownership and

possession with damages against petitioner. They

sought to get back the land and the house and lot
located at Binalonan allegedly purchase by Miguel
during his cohabitation with petitioner. The lower
court dismissed the complaint but CA reversed the
decision.
ISSUE: Whether or not the properties from Miguel's
second marriage be granted to Erlinda.
HELD: No, The sale of the Riceland was made in
favor of Miguel and Erlinda. The provision of law
applicable here is Article 148 of the Family Code
providing for cases of cohabitation when a man and
a woman who are not capacitated to marry each
other live exclusively with each other as husband
and wife without the benefit of marriage or under a
void marriage. While Miguel and Erlinda contracted
marriage on July 15, 1973, said union was clearly
void because the earlier marriage of Miguel and
Carlina was still subsisting and unaffected by the
latters de facto separation.
Under Article 148, only the properties acquired by
both of the parties through their actual joint
contribution of money, property or industry shall be
owned by them in common in proportion to their
respective contributions. It must be stressed that
actual contribution is required by this provision, in
contrast to Article 147 which states that efforts in
the care and maintenance of the family and
household, are regarded as contributions to the
acquisition of common property by one who has no
salary or income or work or industry. If the actual
contribution of the party is not proved, there will be
no co-ownership and no presumption of equal
shares.
Erlinda failed to prove that she actually contributed
money for the said property, so, the court found no
basis to justify her co-ownership with Miguel over
the same. Consequently, the riceland should, as
correctly held by the Court of Appeals, revert to the
conjugal partnership property of the deceased
Miguel and private respondent Carlina Palang.
With regard to the house and lot, the transaction
was properly a donation made by Miguel to Erlinda,
but one which was evidently void and inexistent by
express provision of law because it was made
between persons guilty of adultery or concubinage
at the time of the donation, under Article 739 of the
Civil Code. Moreover, Article 87 of the Family Code
expressly provides that the prohibition against
donations between spouses now applies to

donations between persons living together as

husband and wife without a valid marriage.
_______
HARDING v. COMERCIAL UNION ASSURANCE
FACTS: 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; 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; The cars value was
estimated with the help of an experienced
mechanic (Mr. Server) of the Luneta Garage. The
car was bought by Mr. Harding for P2,800.00. The
mechanic, considering some repairs done,
estimated the value to be at P3,000.00. This
estimated value was the value disclosed by Mrs.
Harding to Smith, Bell, and Co. She also disclosed
that the value was an estimate made by Luneta
Garage (which also acts as an agent for Smith,
Bell, and Co).
In March 1916, a fire destroyed the Studebaker.
Mrs. Harding filed an insurance claim but
Commercial Union denied it as it insisted that the
representations and averments made as to the cost
of the car were false; and that said statement was a
warranty. Commercial Union also stated that the
car does not belong to Mrs. Harding because such
a gift [from her husband] is void under the Civil
Code.
ISSUE: Whether or not Mrs. Harding is entitled to
the insurance claim.
HELD: Yes. Commercial Union is not the proper
party to attack the validity of the gift made by Mr.
Harding to his wife.
The statement made by Mrs. Harding as to the cost
of the car is not a warranty. The evidence does not
prove that the statement is false. In fact, the
evidence shows that the cost of the car is more
than the price of the insurance. The car was bought
for P2,800.00 and then thereafter, Luneta Garage

made some repairs and body paints which

amounted to P900.00. Mr. Server attested that the
car is as good as new at the time the insurance
was effected.
Commercial Union, upon the information given by
Mrs. Harding, 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.
_______
ARCABA v. TABANCURAVDA DE BATOCAEL
GR NO. 146683
FACTS: Francisco Comille and his wife
ZosimaMontallana became the registered owners
of Lot No. 437-A located at Balintawak St. and Rizal
Avenue in Dipolog City, Zamboangadel Norte in
January 1956. Zosima died in 1980 hence
Francisco and his mother in law executed a deed of
extrajudicial partition with waiver of rights, where
the latter waived her share consisting of of the
property in favor of Francisco. Since Francisco do
not have any children to take care of him after his
retirement, he asked Leticia, his niece, Leticias
cousin, Luzviminda and CirilaArcaba, the petitioner,
who was then a widow and took care of Franciscos
house
as
well
as
the
store
inside.
According to Leticia, Francisco and Cirila were
lovers since they slept in the same room. On the
other hand, ErlindaTabancura, another niece of
Francisco claimed that the latter told her that Cirila
was his mistress. However, Cirila defensed herself
that she was a mere helper who could enter the
masters bedroom when Francisco asked her to
and that Francisco was too old for her. She denied
having sexual intercourse with Francisco. When
the nieces got married, Cirila who was then 34
year-old widow started working for Francisco who
was 75 year old widower. The latter did not pay
him any wages as househelper though her family
was provided with food and lodging. Franciscos
health deteriorated and became bedridden.
Tabancura testified that Franciscos only source of
income was the rentals from his lot near the public

streets.
In January 1991, few months before Francisco
died, he executed a Deed of Donation Inter Vivos
where he ceded a portion of Lot 437-A composed
of 150 sq m., together with his house to Cirila who
accepted the same. The larger portion of 268 sq
m. was left under his name. This was made in
consideration of the 10 year of faithful services of
the petitioner. AttyLacaya notarized the deed and
was later registered by Cirila as its absolute owner.
In Octoer 1991, Francisco died and in 1993, the lot
received by Cirila had a market value of P57,105
and assessed value of P28,550. The decedents
nephews and nieces and his heirs by intestate
succession alleged that Cirila was the common-law
wife
of
Francisco.
ISSUE: Whether or not the deed of donation inter
vivos executed by Francisco in Arcabas favor was
valid.
HELD: The court in this case considered a
sufficient proof of common law relationship wherein
donation is not valid. The conclusion was based
on the testimony of Tabancura and certain
documents bearing the signature of CirilaComille
such as application for business permit, sanitary
permit and the death certificate of Francisco. Also,
the fact that Cirila did not demand her wages is an
indication that she was not simply a caregiver
employee.
Cohabitation means more than sexual intercourse,
especially when one of the parties is already old
and may no longer be interested in sex at the very
least, cohabitation is a public assumption of men
and women holding themselves out to the public as
such.
Hence, the deed of donation by Francisco in favor
of Cirila is void under Art. 87 of the Family Code.
_________
BA FINANCE CORP v. COURT OF APPEALS
FACTS: Augusto Yulo secured a loan from the
petitioner in the amount of P591,003.59 as
evidenced by a promissory note he signed in his
own behalf and as a representative of A&L
Industries. Augusto presented an alleged special
power of attorney executed by his wife, Lily Yulo,
who managed the business and under whose name
the said business was registered, purportedly
authorized the husband to procure the loan and
sign the promissory note. 2months prior the
procurement of the loan, Augusto left Lily and their

children which in turn abandoned their conjugal

home. When the obligation became due and
demandable, Augusto failed to pay the same.
The petitioner prayed for the issuance of a writ of
attachment alleging that said spouses were guilty of
fraud consisting of the execution of Deed of
Assignment assigning the rights, titles and interests
over a construction contract executed by and
between the spouses and A. Soriano Corporation.
The writ hereby prayed for was issued by the trial
court and not contented with the order, petitioner
filed a motion for the examination of attachment
debtor alleging that the properties attached by the
sheriff were not sufficient to secure the satisfaction
of any judgment which was likewise granted by the
court.
ISSUE: WON A&L Industries can be held liable for
the obligations contracted by the husband.
HELD: A&L Industries is a single proprietorship,
whose registered owner is Lily Yulo. The said
proprietorship was established during the marriage
and assets were also acquired during the same.
Hence, it is presumed that the property forms part
of the conjugal partnership of the spouses and be
held liable for the obligations contracted by the
husband. However, for the property to be liable,
the obligation contracted by the husband must have
redounded to the benefit of the conjugal
partnership. The obligation was contracted by
Augusto for his own benefit because at the time he
incurred such obligation, he had already
abandoned his family and left their conjugal home.
He likewise made it appear that he was duly
authorized by his wife in behalf of the company to
procure such loan from the petitioner. Clearly,
there must be the requisite showing that some
advantage accrued to the welfare of the spouses.
_________
METROBANK, ET AL. v. TAN
Facts: Petitioners assail Court of Appeals'
affirmance of the trial court's decision absolving
respondents from liability for the principal obligation
obtained by their son Rey John Tan which was
secured by real estate mortgages, including that
covered by the title in question, and declaring such
obligation of their son, who is not a party to the
case, to have been fully paid by him before the
questioned extra-judicial foreclosure and public
auction conducted on April 17, 1998. Respondent's
on the other hand filed a complaint on the day
before the scheduled public auction for removal of
cloud on the title in question and stating as one of

the grounds-bases of their complaint is the fact that

respondent Eliza Go Tan, the wife of Jose Tan,
never gave her consent or conformity to encumber
the title in question.
Issue: Whether or not the alleged lack of
respondent Eliza Go Tan's consent to the mortgage
covering the title in question would render the
encumbrance void under the second paragraph of
Art. 124 of the Family Code?
Ruling: No. The claim that respondent Eliza Go
Tan did not give her consent to the mortgage of the
title in question is belied by her signature. In
adherence to the jurisprudence laid down in Ruiz vs
CA, the mere statement in the title that the property
is "registered in accordance with the provisions of
Section 103 of the Property Registration Decree in
the name of Jose B. Tan, of legal age, married to
Eliza Go tan" does not prove or indicate that the
property is conjugal. It is merely descriptive of the
civil status of Jose and should not be construed to
mean that his wife is also a registered owner.
Respondents failed to established that the property
was in fact acquired during the marriage and as a
consequence to such, the presumption that such
property is conjugal cannot apply. Hence, the
extrajudicial foreclosure and subsequent sale of the
mortgaged property covered by the title in question
was valid.
_______
RODRIGUEZ v. SUSANA DELA CRUZ ET AL.
FACTS: On August 21, 1905, Matae E. Rodriguez,
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 the
property was acquired during her first marriage
from her deceased father, Alejo Rodriguez. But the
defendants commence that the property was
acquired during the first marriage of Hilarion Dela
Cruz with Andrea De Leon. On May 29, 1905, in
relation to the petition, the defendants filed a
special denial for denying the facts claim in the
petition of the plaintiff. The judge ruled in favor of
the defendants. Petitioner appealed on the decision
of the lower court on the ground of committing an
error.

ISSUE: Whether or not the parcels of land in

question is a conjugal property of Matae E.
Rodriguez and Hilarion Dela Cruz
HELD: No. After examining the evidences adduced
during the trial, the court ruled that the parcels of
land were acquired through the inheritance of the
plaintiff from her deceased father, Alejo Rodriguez.
Therefore, the decision is reversed in favor of the
plaintiff and that the court entitled her the
possession of the parcels of land and as a rightful
owner.
_______
PELAYO v. COURT OF APPEALS
Facts: Herein petitioner David Pelayo, by a Deed
of Absolute Sale, conveyed to Melki Perez two
parcels of agricultural land situated in Panabo,
Davao. Lorenza Pelayo, the wife of David Pelayo,
witnessed the execution of the deed but only
signed on the third page and refused to sign even
with Perezs numerous requests. The refusal of
Lorenza led to Perez filing an instant complaint for
specific performance against Lorenza and her
husband. Pelayo claimed that the deed was without
his wifes consent and is therefore null and void
under Article 166 of the civil code which was in
effect at the time of the execution of the deed which
provides 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. The trial court held that there was
no marital consent to nor actual consideration for
the deed, and was thus held null and void.
The RTC decision was appealed by Perez to the
CA and it ruled that by Lorenzas signing as witness
to the execution of the deed, she had knowledge of
the transaction and is deemed to have given her
implied consent and declared the deed of sale as
valid and forceable. Herein petitioner filed for
review on certiorari on the ground that the CA made
a novel ruling that there was implied marital
consent of the wife of Pelayo.
Issue: Whether or not there was a lack of marital
consent.
Held: Yes. It was held that Lorenza, by affixing her
signature to the deed of sale gave implied consent.
Although it appears that Lorenza only signed as an
instrumental witness, circumstances leading to the
execution of said document point to the fact that
she was fully aware of the sale of their conjugal
property and consented to its sale. Petitioners did
not even attempt to present any evidence to show
that Lorenzo was in any way lacking in her mental

faculties and, hence, could not have fully

understood the ramifications of signing the said
deed. It was also held that under article 173, in
relation to article 166 of the civil code, which was
still in effect on the date of the execution of the
deed of sale (January 11, 1988), the lack of marital
consent to the disposition of conjugal property does
not make the contract void ab initio but merely
voidable. The contract is valid until the court annuls
the same and only upon an action brought by the
wife whose consent was not obtained. Lorenza did
not file a case for annulment of the deed. It was
only when Perez filed the complaint did the
petitioners alleged Lorenzas lack of consent as a
defense.
_______
SECURITY BANK v. MAR TIERRA CO.

FACTS: On May 7, 1980, respondent Mar Tierra

Corporation, through its president, Wilfrido C.
Martinez, applied for a P12,000,000 credit
accommodation with petitioner Security Bank and
Trust Company. Petitioner approved the application
and entered into a credit line agreement with
respondent corporation. It was secured by an
indemnity agreement executed by individual
respondents Wilfrido C. Martinez, Miguel J. Lacson
and Ricardo A. Lopa who bound themselves jointly
and severally with respondent corporation for the
payment of the loan. On July 2, 1980, the credit line
agreement was amended and increased to
P14,000,000.00. On September 25, 1981,
respondent corporation availed of its credit line and
received the sum of P9,952,000 which it undertook
to pay on or before November 30, 1981. It was able
to pay P4,648,000 for the principal loan and
P2,729,195.56 for the interest and other charges.
However, respondent corporation was not able to
pay the balance as it suffered business reversals,
eventually ceasing operations in 1984. Unable to
collect the balance of the loan, petitioner filed a
complaint for a sum of money with a prayer for
preliminary
attachment
against
respondent
corporation and individual respondents in the
Regional Trial Court. Subsequently, however,
petitioner had the case dismissed with respect to
individual respondents Lacson and Lopa, leaving
Martinez as the remaining individual respondent.On
August 10, 1982, the RTC issued a writ of
attachment on all real and personal properties of
respondent corporation and individual respondent
Martinez. As a consequence, the conjugal house
and lot of the spouses Wilfrido and Josefina
Martinez in Barrio Calaanan, Caloocan City

covered by Transfer Certificate of Title (TCT) No.

49158 was levied on.
ISSUE: May the conjugal partnership be held liable
for an indemnity agreement entered into by the
husband to accommodate a third party?
HELD: In this case, the principal contract, the credit
line agreement between petitioner and respondent
corporation, was solely for the benefit of the latter.
The accessory contract (the indemnity agreement)
under which individual respondent Martinez
assumed the obligation of a surety for respondent
corporation was similarly for the latters benefit.
Petitioner had the burden of proving that the
conjugal partnership of the spouses Martinez
benefited from the transaction. It failed to discharge
that burden.
To hold the conjugal partnership liable for an
obligation pertaining to the husband alone defeats
the objective of the Civil Code to protect the
solidarity and well being of the family as a unit. The
underlying concern of the law is the conservation of
the conjugal partnership.Hence, it limits the liability
of the conjugal partnership only to debts and
obligations contracted by the husband for the
benefit of the conjugal partnership.
_______
VILLANUEVA v. COURT OF APPEALS
FACTS: Eusebia Napisa Retuya, is the legal wife of
defendant Nicolas Retuya have been married to the
latter on Oct. 7, 1926. During their marriage, they
acquired several real properties and all
improvements situated in Mandaue City and
Consolacion, Cebu. Also, defendant, Nicolas
Retuya is co-owner of a parcel of land situated in
Mandaue City which he inherited from his parents
Esteban Retuya and Balbina Solon as well as the
purchasers of hereditary shares of approximately 8
parcels of land in Mandaue City. Some of these
properties above mentioned earn income from
coconuts and the other land/houses are leased. In
1945, defendant Nicolas Retuya no longer lived
with his legitimate family and cohabited with
defendant Pacita Villanueva wherein defendant
Procopio Villanueva is their illegitimate son.
Nicolas, then, was the only person who received
the income of the above mentioned properties.
Defendant Pacita Villanueva from the time she
started living in concubinage with Nicolas, has no
occupation, she had no properties on her own from
which she could derive income. Natividad Retuya,
daughter of Nicolas and Eusebia Retuya went to
court and prayed for the declaration of properties
named under Pacita Villanueva to be declared as

conjugal properties of Eusebia and Nicolas Retuya

as the former had no means to acquire said
properties.
ISSUE: Whether or not the properties acquired by
Nicolas Retuya during his cohabitation with Pacita
Villanueva, having her named as the owner thereof,
be still considered as part of the conjugal properties
of Nicolas and her legal wife, Eusebia.
HELD: Yes. Article 116 of the Family Code states
that 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 conjugal unless the
contrary is proved. The court ruled that Eusebia
proved that the subject properties are conjugal in
nature. The petitioners failed to meet the standard
of proof required to maintain their claim that subject
properties are paraphernal properties of Nicolas
and that Pacita presented no factual solidity to
support her claim that she bought Lot No. 152
exclusively with her own money. No unilateral
declaration by one spouse can change the
character of conjugal property. Whether a property
is conjugal or not is determined by law and not by
the will of one the spouses.
__________
VILLANUEVA
v.
THE
INTERMEDIATE
APPELLATE COURT G.R. No. 74577 192 SCRA
21
FACTS: The spouses Graciano Aranas and
Nicolasa Bunsa were the owners in fee simple of a
parcel of land identified as Lot 13. After they died,
they had 2 surviving children, Modesto Aranas
and Federico Aranas. The southern portion,
described as Lot 13-C, assigned to Modesto; the
northern, to Federico.
Modesto Aranas died on April 20, 1973 and his
wife predeceased him on July 16, 1971. They had
no children. But 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" a relative, Raymundo
Aranas, signed the agreement as a witness.
Dorothea and Teodoro failed to pay their loan.
As a result, Bernas caused the extrajudicial
foreclosure of the mortgage over Lot 13-C and
acquired the land at the auction sale as the highest
bidder. Bernas consolidated his ownership over
Lot 13-C, the mortgagors having failed to redeem
the same and had the latter's title (In the name of

Modesto Aranas) cancelled and another issued in

his name.
Consolacion Villanueva and Raymundo Aranas,
filed a complaint with the Regional Trial Court at
Roxas City against Jesus Bernas and his wife. In
their complaint, the plaintiffs prayed that the latter's
title over Lot 13-C be cancelled and they be
declared co-owners of the land on the grounds that
the discovery of two (2) wills:
1.
Executed February 11, 1958 by Modesto
Aranas
Modesto Aranas' will, on the other hand, left
Dorothea and Teodoro Aranas 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."
2.
Executed October 29, 1957 by his wife,
Victoria Comorro.
Victoria Comorro's will allegedly left Consolacion
and Raymundo, and Dorothea and Teodoro Aranas,
in equal shares pro indiviso, all of "interests,
rights and properties, real and personal . . . as
her net share from (the) conjugal partnership
property with her husband, Modesto Aranas . .
."
The judgment was rendered in favor of the
defendants and against the plaintiffs. The plaintiffs
appealed to the Intermediate Appellate Court, the
judgment of the Regional Trial Court having been
otherwise affirmed in toto.
From this judgment of the Appellate Court,
Consolacion Villanueva appealed to this Court.
Her co-plaintiff, Raymundo Aranas, did not.
ISSUE: Whether or not Consolacion Villanueva has
right over Lot 13-C and the improvements thereon
standing by virtue of Victoria Camorro's last will
even though he name is not mentioned in Modesto
Aranas will
RULING: No, Villanueva has no right over Lot 13C. Certain it is that the land itself, Lot 13-C, was not
"conjugal partnership property" of Victoria Comorro
and Modesto Aranas. It was the latter's exclusive,
private property, which he had inherited from his
parents registered solely in his name. 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 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.
Article 120 of the Civil Code says that
improvements,
"whether
for
utility
or
adornment, made on the separate property of
the spouses through advancements from the
partnership or through the industry of either 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." 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 by Consolacion Villanueva or
any one else.

business. On 1989, private respondents answered

that that the accounting was not feasible due to the
dissolution of the company by the partners on 1982
because of financial losses. As a result, whatever
was due to each partner was already given him.
The answer also states that Alfonso mismanaged
the business during his managerial tenure resulting
to his advances and indebtedness of P130, 000.00.
Finally, private respondents alleged that the share
of Alfonso was mortgaged by him to his sister,
Lolita Tan-Go, in order to secure a loan he obtained
from her.

TAN v. COURT OF APPEALS

On 1990, Alfonso filed a motion to dismiss on the

grounds that the case was filed only at the instance
of his estranged wife and the fact that he had no
claim against his brothers concerning the business.
The trial court denied the motion. Eteria testified
her marriage with Alfonso but they are now living
separately via legal separation. The same testified
that both the subject lot and the funds used in the
construction of the house standing thereon were
drawn from a loan she and her husband secured
but it was her husband and mother-in-law who drew
the loan. Private respondents attempted to
establish the following: the dissolution of the family
business due to mismanagement caused by the
incompetence of Alfonso, the latter had no more
claim against the business because of his large
borrowings on his equity in the same and his
siblings and the subject property was inherited from
their mother (Trinidad Uy), Alfonso borrowed
money from her sister (Lolita) and consequently
mortgaged his share of the property to her and the
failure of Alfonso to pay the loan and the house on
the lot was constructed using the funds from a loan
contracted by their mother from SSS. However, no
documentary evidence was submitted regarding the
inheritance of their mother.

FACTS: On 1989, a case for partition and

accounting was instituted by the spouses Alfonso
Tan and Eteria Teves Tan (petitioners) against
Celestino Tan and Maximo Tan (private
respondents) and their respective wives, Rosario
Kushin and Teresita Tan. The complaint alleged that
the parties are co-owners of a 906-square meter
improved residential lot at Banaue, Cebu City
acquired. In accordance with Article 494 of the New
Civil Code, Alfonso and Eteria, as co-owners of the
one-third (1/3) portion of the lot sought partition of
the same. On 1963, the spouses claimed that the
brothers together with their other siblings
established a business called Bel Air Auto Supply
Company engaged in the sale and distribution of
auto spare parts. The same alleged that they are
entitled to the fruits, proceeds and profits of the

On a 1991 Decision, it was held that the lot in

question was acquired by the Tan brothers and
their respective wives. Specifically, since the
property was acquired during the marriage of
Alfonso and Eteria, the wife could not be deprived
of her share of the conjugal property. The earnings
of the auto spare parts business is excluded
because of dissolution due to losses. On 1991, the
private
respondents
filed
for
Motion
of
Reconsideration contending that the lot was
actually inherited by the Tan brothers and their
sisters from their mother who died intestate on
1968 but the said lot was adjudicated to the
brothers in a notarized Extrajudicial Declaration of
Heirs and Adjudication of Properties. The trial court
denied the motion because it was not presented as
trial evidence.

Furthermore, Bernas' mode of acquisition of

ownership over the property, by a mortgage sale,
appears in all respects to be regular, untainted by
any defect whatsoever.
_______

Dissatisfied with the ruling of the trial court, the

private respondents interposed an appeal to the
Court of Appeals. This resulted to the eventual
reversal and setting aside of the judgment. In other
words, the Court of Appeals ruled that the property
was established by the Tan brothers and the same
was inherited from their mother making the property
their exclusive property notwithstanding the
acquisition of the same by Alfonso and Eteria
during their marriage. This led to Eteria raising the
following errors
a. Since the acquisition of the property was during
her marriage with Alfonso, the presumption of
conjugality remains and the burden of proof lies in
the private respondents and not the petitioner.
b. The CA ruling that the lot exclusively belongs to
Alfonso Tan just because it was mentioned in the
Transfer Certificate of Title (TCT) is against wellsettled Philippine jurisprudence.
ISSUE: Whether or not the lot shares of the subject
lot, being acquired during marriage, is the conjugal
property of Alfonso and Esteria subjecting the latter
to the conjugal shares thereof.
HELD: No. Article 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 presumption
is rebuttable with strong, categorical and convincing
evidence that the property belongs exclusively to
the one of the spouses and the burden of proof
rests upon the asserting party. In spite of the TCT
not admitted as evidence but only as and annex to
the motion of the private respondents, the source of
the property can be reasonably and materially
inferred from the TCT. There can be no doubt, then,
that although the acquisition was during the
marriage, the property should be regarded as an
exclusive property of Alfonso according to Article
148 of the New Civil Code which provides thatArticle 148. The following shall be the exclusive
property of each spouse: (2) That which each
acquires, during the marriage, by lucrative title.
Therefore, the property is exclusively owned by
Alfonso.
_______
BPI v. JUAN POSADAS
FACTS: The estate of Adolphe Oscar Schuetze is
the sole beneficiary named in the life-insurance
policy for $10,000, issued by the Sun Life
Assurance Company of Canada on January 14,

1913. During the following five years the insured

paid the premiums at the Manila branch of the
company, and in 1918 the policy was transferred to
the London branch. The record shows that the
deceased Adolphe Oscar Schuetze married the
plaintiff-appellant Rosario Gelano on January 16,
1914. Bank of the Philippine Islands, was appointed
administrator of the late Adolphe Oscar Schuetze's
testamentary estate by an order dated March 24,
1928, entered by the Court of First Instance of
Manila. On July 13, 1928, the Sun Life Assurance
Company of Canada, whose main office is in
Montreal, Canada, paid Rosario Gelano Vda. De
Schuetze upon her arrival at Manila, the sum of
P20, 150, which was the amount of the insurance
policy on the life of said deceased, payable to the
latter's estate. On the same date Rosario Gelano
Vda. De Schuetze delivered the money to said
Bank of the Philippine Islands, as administrator of
the deceased's estate, which entered it in the
inventory of the testamentary estate, and then
returned the money to said widow. The present
complaint seeks to recover from the defendant
Juan Posadas, Jr., Collector of Internal Revenue,
the amount of P1, 209 paid by the plaintiff under
protest, in its capacity of administrator of the estate
of the late Adolphe Oscar Schuetze, as inheritance
tax upon the sum of P20, 150, which is the amount
of an insurance policy on the deceased's life,
wherein his own estate was named the beneficiary.
ISSUE: (1) Whether or not Plaintiff herein will be
entitled to the inheritance
HELD: The Court ruled that:
(1) the proceeds of a life-insurance policy payable
to the insured's estate, on which the premiums
were paid by the conjugal partnership, constitute
community property, and belong one-half to the
husband and the other half to the wife, exclusively;
(2)if the premiums were paid partly with
paraphernal and partly conjugal funds, the
proceeds are likewise in like proportion paraphernal
in part and conjugal in part; and
(3)the proceeds of a life-insurance policy payable to
the insured's estate as the beneficiary, if delivered
to the testamentary administrator of the former as
part of the assets of said estate under probate
administration, are subject to the inheritance tax
according to the law on the matter, if they belong to
the assured exclusively, and it is immaterial that the
insured was domiciled in these Islands or outside.
WHEREFORE, the judgement appealed from is
reversed, and the defendant was ordered to return
to the plaintiff one-half of the tax collected upon the
amount of P20, 150, being the proceeds of the

insurance policy on the life of the late Adolphe

Oscar Schuetze, after deducting the proportional
part corresponding to the first premium, without
special pronouncement of costs. So ordered.
___________
JOCSON

v.

COURT

OF

APPEALS

FACTS: Petitioner Moises Jocson and private

respondent Agustina Jocson-Vasquez are the only
surviving offsprings of the spouses Emilio Jocson
and Alejandra Poblete. While private respondent
Ernesto Vasquez is the husband of Agustina.
The present controversy concerns the validity of
three documents, namely (1) Kasulutan ng Bilihan
ng Lupa (Deed of Sale), (2) Kasulutan ng Ganap na
Bilihan (Deed of Absolute Deed of Sale) and (3)
Deed of Extrajudicial Partition and Adjudication with
Sale, executed by Emilio Jocson during his lifetime.
These documents refer to the sale of almost all of
Emilios properties to, including his one-third share
in his wifes estate, his daughter, Agustina.
Moises Jocson assails these documents claiming,
among others, that the properties mentioned in
documents 1 and 2 (Subject Properties) are the
unliquidated conjugal properties of Emilio Jocson
and Alejandra Poblete which the former, therefore,
cannot validly sell under Article 160 of the Civil
Code (now Article 116 of Family Code) which
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."
The trial court sustained Moises Jocson's position
declaring, among others, the Subject Properties as
conjugal properties of Emilio Joscon and Alejandra
Poblete, because they were registered in the name
of "Emilio Joscon, married to Alejandra Poblete"
and ordered that the Subject Properties be
registered in the name of herein petitioners and
private respondents. CA reversed the trial courts
decision.
ISSUE: Whether or not the Subject Properties were
conjugal properties of Emilio Jocson and Alejandra
Poblete
HELD: No. The certificate of title upon which
Moises Jocson 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. 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.
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. 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.
_______
MAGALLON v. MONTEJO G.R. No. 73733
December 16, 1986
FACTS: Respondents claiming as the common
children of Martin and his wife, Eustaquia Pichan,
who died in 1953, asserted a right to of the land
as their mothers share in her conjugal partnership
with Martin. Defendant denied the marriage to
Eustaquia although admitted living with her without
benefit of marriage.
The Trial Court found that Martin was indeed
married to Eustaquia and the respondents were
their children. Further, they also found that Martin
has begun working the homestead, and his right to
a patent to the accrued, during his coverture with
Eustaquia. On the basis of these findings, the
plaintiffs were declared entitled to the land claimed
by them.
Martin Lacerna appealed to the Intermediate
Appellate Court. It appears that at the time the case
was brought no certificate of title has been issued
to Martin although he has complied with the
requirements necessary to the grant. The Original
Certificate Title was only issued while Martins
appeal was pending in the IAC. It states on its face
that it is issued in the of Martin Lacerna, Fiipino,
of legal age, married to Epifania Magallon , the
latter being the present petitioner. Therefore, the
IAC ruled in favor of respondents thus a writ of
execution was issued.
ISSUE: Whether or not Martin and petitioner owned
the property?
HELD: No. The land in question, which rightfully
pertained to the conjugal partnership of Martin
Lacerna and Eustaquia Pichan, the plaintiffs
mother, and should have been titled in the names
of spouses, was, through fraud or mistaken,

registered in the names of Martin Lacerna and

petitioner herein, Epifania Magallon in such
situation, the property should be regarded as
impressed with an implied, or a constructive, trust
for the party rightfully entitled thereto. The petitioner
herein, as the trustee of a constructive trust, has an
obligation to convey to the private respondents that
part of the land in question to which she now claims
an ostensible title, said in portion rightfully
pertaining to the respondents decease mother as
her share in the conjugal partnership with Martin
Lacerna.
_________
CARANDANG v. HEIRS OF QUIRINO DE
GUZMAN

Three of the four checks used to pay the stock

subscriptions of the spouses was issued by
Milagros De Guzman the wife of Quirino De
Guzman and shall be considered as an
indispensable party and shall be joined as a partyplaintiff in the case. Failure to do so may cause the
dismissal of the action for no cause of action.

Facts: Acardio and Maria Luisa Carandang

(spouses Carandang) and Quirino De Guzman are
stockholders as well as corporate officers of
Mabuhay
Broadcasting
System
(MBS).
Respectively they have equities of 54% and 46%.

Held:

MBS increased its capital stock to Php 1.5 million

on November 26, 1983, Php 345,000 of this was
subscribed by the spouses Carandang. A little later,
on March 3, 1989 the company has increased its
capital stock once again to Php 3 million. The
spouses Carandang yet again subscribed to Php
93,750 of the stock.
Php 336,375 of the payment for these subscriptions
made by the spouses Carandang were paid by De
Guzman. On March 31, 1992 sent a demand letter
for the spouses to pay him what they owe. But the
petitioners of the case refused to do so, claiming
that a pre-incorporation agreement was executed
between the parties where the respondent
promised to pay for the stock subscriptions for the
petitioners
(Arcadio
Carandang)
technical
expertise.
A complaint was filed by De Guzman on June 5,
1992 against the spouses Carandang, seeking to
recover the Php 336,375 they owe with damages.
The Regional Trial Court (RTC) has held against
the spouses Carandang and ordered for the
payment of the money owed with 12% interest per
annum and Php 20,000 worth of attorneys fees.
April 22, 2003 when the spouses Carandang
appealed the decision of the RTC to the Court of
Appeals who later on affirmed the decision made.
Then October 6 of the same year the spouses filed
for a Motion for Reconsideration which was denied
as well. Thus the instant case.

Issue:
1.
Whether or not the decision made by the
RTC is erroneous since Milagros De Guzman was
not mentioned as a party-plaintiff.
2.
Whether or not the liability of the spouses
Carandang on joint and solidary.

1.
No. Quirino and Milagros De Guzman were
married before the effectivity of the Family Cod but
it is assumed that the regime of conjugal
partnership of gains govern their property relations.
And all the properties they had acquired during
their marriage it is presumed it is as well conjugal
unless the contrary was provided; as stated in the
Family Code, Articles 116. In this case it is
presumed that the checks issued by Milagros are
considered as a conjugal party of her and Quirino
despite her not being mentioned as a party-plaintiff
in the case.
2.
Yes. Just like Quirino and Milagros the
spouses Carandang were married before the
effectivity of the Family Code and their property
regime is conjugal partnership under the Civil
Code. The obligations they entered as husband
and wife is chargeable against their conjugal
partnership and not as an independent debtors.
The Supreme Court has affirmed the decision
rendered by the RTC and CA earlier against the
spouses Carandang.
_________
CASTILLO v. PASCO
FACTS: On December 22, 1932, Gabriel and
Purificacion Gonzales, as co-owners of the litigated
fishpond, executed a deed of sale conveying said
property to the spouses Marcelo Castillo, Sr. and
Macaria Pasco for the sum of P6,000.00, payable
in three installments.
The initial payment of P1,000 for the fishpond 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 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.
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.
ISSUE: Whether or not the fishpond was exclusive
paraphernal property of respondent Macaria Pasco,
surviving spouse of the deceased Marcelo Castillo,
Sr.
HELD:
No. The loans became obligations of the conjugal
partnership of both debtor spouses, and the money
loaned is logically conjugal 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.
_________
AYALA INVESTMENT AND DEVELOPMENT
CORPORATION v. CA, G.R. No. 118305,
February 12, 1988

FACTS: Philippine Blooming Mills (PBM) obtained

a P50,300,000 loan from petitioner Ayala
Investment and Development Corporation (AIDC).
Respondent Alfredo Ching made himself jointly
answerable to the debt as added security. Upon
PBMs failure to pay the loan, AIDC filed a case for
sum of money against PBM and respondent Ching
in the Court of First Instance (CFI) of Pasig. After
trial, the court rendered decision in favour of AIDC
ordering PBM and Alfredo Ching to jointly and
severally pay AIDC the principal amount of the loan
with interests. Pending the appeal of the judgment,
RTC issued a writ of execution and thereafter, the
deputy sheriff caused the issuance and service
upon respondent spouses of the notice of sheriff's
sale on three of their conjugal properties.
Respondent spouses then filed an injunction
contending that subject loan did not redound to the
benefit of the conjugal partnership. Nevertheless, a
certificate of sale was issued to AIDC, being the
only bidder for the property.
ISSUE: Whether or not the debts and obligations
contracted by the husband alone is considered for
the benefit of the conjugal partnership.
HELD: No. Petition is DENIED. The loan obtained
by the husband from AIDC was for the benefit of
PBM and not for the benefit of the conjugal
partnership of Ching. Furthermore, AIDC failed to
prove that Ching contracted the debt for the benefit
of the conjugal partnership of gains. PBM has a
personality distinct and separate from the family of
Ching despite the fact that they happened to be
stockholders of said corporate entity. Clearly, the
debt was a corporate debt and right of recourse to
Ching as surety is only to the extent of his
corporate stockholdings. Based from the foregoing
jurisprudential rulings of the court, 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.
Ching only signed as a surety for the loan
contracted with AIDC in behalf of PBM. Signing as
a surety is certainly not an exercise of an industry
or profession, it is not embarking in a business.
Hence, the conjugal partnership should not be
made liable for the surety agreement which was
clearly for the benefit of PBM.
__________

LACSON v. DIAZ
FACTS: The final decision rendered by the Court of
First Instance of Negros Occidental in civil case no.
5790 ordering defendant to pay plaintiff a sum of
P97,532.92 with legal interest until fully paid plus a
sum, and attorneys fees, then court issued a writ of
execution. On August 7, 1961 provincial sheriff of
Negros sent to the manager of Talisay-Silay Milling
Company, where defendant worked, notice to
garnish one-third of his monthly salary, and any
other personal properties to cover the total amount
P132,718.30. Defendant filed a motion to quash the
writ of execution and to lift the notice of
garnishment of his salary, arguing that it is not
enforceable as the money judgment arose from a
contract entered by him in his first marriage, that
the judgment cannot be enforced against his
salaries which form part of the conjugal properties
of the second marriage.
ISSUE: W/N the defendants salary may be used to
pay the debt contracted before the second
marriage.
HELD: Article 163 of the civil code states that:
ART. 163. The payment of debts contracted by the
husband or the wife before the marriage shall not
be charged to the conjugal partnership.
Neither shall the fines and pecuniary indemnities
imposed upon them be charged to the partnership.
However, the payment of debts contracted by the
husband or the wife before the marriage, and that
of fines and indemnities imposed upon them, may
be enforced against the partnership assets after the
responsibilities enumerated in article 161 have
been covered, if the spouse who is bound should
have no exclusive property or if it should be
insufficient; but at the time of the liquidation of the
partnership such spouse shall be charged for what
has been paid for the purpose above-mentioned.
Yes, such obligations incurred before the marriage
may be enforced the conjugal assets if the
responsibilities enumerated in Article 161 of the new
Civil Code have already been covered, and that the
obligor has no exclusive property or the same is
insufficient. However, it has not yet been
established that the defendant does not have
properties of his owner that the same are not
enough to satisfy the appellant claim. Also, there is
no showing that the responsibilities named in Article
161 of the new Civil Code have already been
covered in order that the personal obligation of the
husband may be made chargeable against the

properties of the second marriage. Case is hereby

remanded to lower court for further proceedings.
_______
PEOPLE v. LAGRIMAS
FACTS: On february 15, 1960 in Pambujan, Samar,
Pelagio Cagro was murdered by Froilan Lagrimas.
It follows in such criminal cases that the accused is
not only criminally liable but also civilly liable. On
February 27, 1960, the heirs of Cagro filed a motion
for the issuance of a writ of preliminary attachment
on the property of the accused. Said motion was
granted on March 5, 1960. Meanwhile, Froilan
Lagrimas was found guilty after trial and was
penalized with reclusion perpetua and to indemnify
the heirs of Cagro with a sum of 6000 php and
10,000 php. The latter as attorneys fees and burial
expenses. To cover for the civil indemnities, the
court issued a writ of execution. Eleven parcels of
land owned by Lagrimas, were supposed to be sold
in a public action, scheduled on january 5, 1965.
However Mercedes Lagrimas, wife of Froilan,
moved to quash the motion of the heirs of Cagro.
Her reason for this was, the properties held for
auction were conjugal properties and cannot be
used for pecuniary indemnity. The motion was
granted, however the heirs of Cagro appealed and
was sustained. Unfortunately another judge of the
lower court declared the attachment and writ of
execution null and void under the assumption that
conjugal properties are exempted prior to its
liquidation.
ISSUE: whether or not the conjugal property can be
used as a payment for pecuniary indemnity, of one
of the spouses prior to its liquidation.
HELD: Yes. The conjugal property can be used to
indemnify the offended party, provided that the
responsibilities stated in article 161 of the Civil
Code have been covered, in cases wherein the
spouse obliged to indemnify does not have enough
money to do so or enough properties, it is clearly
stated that the liability may be enforced
presupposes that the conjugal property still exists.
As clearly stated in article 163 of the Civil code.
The termination of the conjugal partnership for the
assets to be liquified is not a prerequisite in order
for the responsibilities under article 161 be covered
including the indemnification of the offended
spouse.