Republic
of the
Supreme
Court
SECOND
DIVISION
|
BRIGIDO B.
QUIAO, Petitioner, - versus - RITA C. QUIAO, KITCHIE C. QUIAO, LOTIS C. QUIAO, PETCHIE
C. QUIAO, represented by their mother RITA QUIAO, Respondents. |
G.R. No
176556 Present: CARPIO, J., Chairperson, BRION, PEREZ, SERENO, and REYES, JJ. Promulgated: July 4, 2012 |
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DECISION
REYES, J.:
The
family is the basic and the most important institution of society. It is in the family where children are born
and molded either to become useful citizens of the country or troublemakers in
the community. Thus, we are saddened
when parents have to separate and fight over properties, without regard to the
message they send to their children. Notwithstanding
this, we must not shirk from our obligation to rule on this case involving
legal separation escalating to questions on dissolution and partition of
properties.
The Case
This case comes before us
via Petition for Review on Certiorari[1] under
Rule 45 of the Rules of Court. The
petitioner seeks that we vacate and set aside the Order[2] dated
January 8, 2007 of the Regional Trial Court (RTC), Branch 1,
Antecedent Facts
On October 26, 2000, herein
respondent Rita C. Quiao (Rita) filed a complaint for legal separation against
herein petitioner Brigido B. Quiao (Brigido).[3] Subsequently, the RTC rendered a Decision[4]
dated October 10, 2005, the dispositive portion of which provides:
WHEREFORE,
viewed from the foregoing considerations, judgment is hereby rendered declaring
the legal separation of plaintiff Rita C. Quiao and defendant-respondent
Brigido B. Quiao pursuant to Article 55.
As
such, the herein parties shall be entitled to live separately from each other,
but the marriage bond shall not be severed.
Except
for Letecia C. Quiao who is of legal age, the three minor children, namely,
Kitchie, Lotis and Petchie, all surnamed Quiao shall remain under the custody
of the plaintiff who is the innocent spouse.
Further,
except for the personal and real properties already foreclosed by the RCBC, all
the remaining properties, namely:
1. coffee
mill in Balongagan, Las Nieves, Agusan del Norte;
2. coffee
mill in Durian, Las Nieves, Agusan del Norte;
3. corn
mill in Casiklan, Las Nieves, Agusan del Norte;
4. coffee
mill in Esperanza, Agusan del Sur;
5. a
parcel of land with an area of 1,200 square meters located in Tungao,
6. a
parcel of agricultural land with an area of 5 hectares located in Manila de
Bugabos,
7. a
parcel of land with an area of 84 square meters located in Tungao,
8. Bashier
Bon Factory located in Tungao,
shall
be divided equally between herein [respondents] and [petitioner] subject to the
respective legitimes of the children and the payment of the unpaid conjugal
liabilities of [P]45,740.00.
[Petitioners]
share, however, of the net profits earned by the conjugal partnership is
forfeited in favor of the common children.
He is
further ordered to reimburse [respondents] the sum of [P]19,000.00 as
attorney's fees and litigation expenses of [P]5,000.00[.]
SO
ORDERED.[5]
Neither
party filed a motion for reconsideration and appeal within the period provided
for under Section 17(a) and (b) of the Rule on Legal Separation.[6]
On
December 12, 2005, the respondents filed a motion for execution[7]
which the trial court granted in its Order dated December 16, 2005, the
dispositive portion of which reads:
Wherefore,
finding the motion to be well taken, the same is hereby granted. Let a writ of execution be issued for the
immediate enforcement of the Judgment.
SO
ORDERED.[8]
Subsequently,
on February 10, 2006, the RTC issued a Writ of Execution[9]
which reads as follows:
NOW
THEREFORE, that of the goods and chattels of the [petitioner] BRIGIDO B. QUIAO
you cause to be made the sums stated in the afore-quoted DECISION [sic],
together with your lawful fees in the service of this Writ, all in the
Philippine Currency.
But if
sufficient personal property cannot be found whereof to satisfy this execution
and your lawful fees, then we command you that of the lands and buildings of
the said [petitioner], you make the said sums in the manner required by
law. You are enjoined to strictly
observed Section 9, Rule 39, Rule [sic] of the 1997 Rules of Civil Procedure.
You
are hereby ordered to make a return of the said proceedings immediately after
the judgment has been satisfied in part or in full in consonance with Section
14, Rule 39 of the 1997 Rules of Civil Procedure, as amended.[10]
On
July 6, 2006, the writ was partially executed with the petitioner paying the
respondents the amount of P46,870.00, representing the following
payments:
(a)
P22,870.00 as petitioner's share of the payment of the conjugal share;
(b)
P19,000.00 as attorney's fees; and
(c)
P5,000.00 as litigation expenses.[11]
On
July 7, 2006, or after more than nine
months from the promulgation of the Decision, the petitioner filed before
the RTC a Motion for Clarification,[12]
asking the RTC to define the term Net Profits Earned.
To
resolve the petitioner's Motion for Clarification, the RTC issued an Order[13]
dated August 31, 2006, which held that the phrase NET PROFIT EARNED denotes
the remainder of the properties of the parties after deducting the separate
properties of each [of the] spouse and the debts.[14] The Order further held that after determining
the remainder of the properties, it shall be forfeited in favor of the common
children because the offending spouse does not have any right to any share of
the net profits earned, pursuant to Articles 63, No. (2) and 43, No. (2) of the
Family Code.[15] The dispositive portion of the Order states:
WHEREFORE,
there is no blatant disparity when the sheriff intends to forfeit all the
remaining properties after deducting the payments of the debts for only
separate properties of the defendant-respondent shall be delivered to him which
he has none.
The
Sheriff is herein directed to proceed with the execution of the Decision.
IT IS SO ORDERED.[16]
Not
satisfied with the trial court's Order, the petitioner filed a Motion for
Reconsideration[17] on
September 8, 2006. Consequently, the RTC
issued another Order[18]
dated November 8, 2006, holding that although the Decision dated October 10,
2005 has become final and executory, it may still consider the Motion for
Clarification because the petitioner simply wanted to clarify the meaning of
net profit earned.[19] Furthermore, the same Order held:
ALL TOLD, the
Court Order dated August 31, 2006 is hereby ordered set aside. NET PROFIT
EARNED, which is subject of forfeiture in favor of [the] parties' common
children, is ordered to be computed in accordance [with] par. 4 of Article 102
of the Family Code.[20]
On November 21, 2006, the respondents filed a Motion for
Reconsideration,[21] praying
for the correction and reversal of the Order dated November 8, 2006. Thereafter, on January 8, 2007,[22]
the trial court had changed its ruling again and granted the respondents'
Motion for Reconsideration whereby the Order dated November 8, 2006 was set
aside to reinstate the Order dated August 31, 2006.
Not
satisfied with the trial court's Order, the petitioner filed on February 27,
2007 this instant Petition for Review under Rule 45 of the Rules of Court,
raising the following:
Issues
I
IS THE
DISSOLUTION AND THE CONSEQUENT LIQUIDATION OF THE COMMON PROPERTIES OF THE
HUSBAND AND WIFE BY VIRTUE OF THE DECREE OF LEGAL SEPARATION GOVERNED BY
ARTICLE 125 (SIC) OF THE FAMILY CODE?
II
WHAT IS THE
MEANING OF THE NET PROFITS EARNED BY THE CONJUGAL PARTNERSHIP FOR PURPOSES OF
EFFECTING THE FORFEITURE AUTHORIZED UNDER ARTICLE 63 OF THE FAMILY CODE?
III
WHAT LAW
GOVERNS THE PROPERTY RELATIONS BETWEEN THE HUSBAND AND WIFE WHO GOT MARRIED IN
1977? CAN THE FAMILY CODE OF THE
IV
WHAT PROPERTIES
SHALL BE INCLUDED IN THE FORFEITURE OF THE SHARE OF THE GUILTY SPOUSE IN THE
NET CONJUGAL PARTNERSHIP AS A RESULT OF THE ISSUANCE OF THE DECREE OF LEGAL
SEPARATION?[23]
Our
Ruling
While
the petitioner has raised a number of issues on the applicability of certain
laws, we are well-aware that the respondents have called our attention to the
fact that the Decision dated October 10, 2005 has attained finality when the
Motion for Clarification was filed.[24] Thus, we are constrained to resolve first the
issue of the finality of the Decision dated October 10, 2005 and subsequently
discuss the matters that we can clarify.
The Decision dated October 10, 2005 has become final and executory at
the time the Motion for Clarification was filed on July 7, 2006.
Section 3, Rule 41 of the Rules of Court provides:
Section 3. Period of ordinary appeal. - The
appeal shall be taken within fifteen (15) days from notice of the judgment or
final order appealed from. Where a
record on appeal is required, the appellant shall file a notice of appeal and a
record on appeal within thirty (30) days from notice of the judgment or final
order.
The period of appeal shall be
interrupted by a timely motion for new trial or reconsideration. No motion for extension of time to file a
motion for new trial or reconsideration shall be allowed.
In Neypes v. Court of Appeals,[25]
we clarified that
to standardize the appeal periods provided in the Rules and to afford
litigants fair opportunity to appeal their cases, we held that it would be
practical to allow a fresh period of 15 days within which to file the notice of
appeal in the RTC, counted from receipt of the order dismissing a motion for a
new trial or motion for reconsideration.[26]
In
Neypes, we explained that the "fresh period rule" shall also
apply to Rule 40 governing appeals from the Municipal Trial Courts to the RTCs;
Rule 42 on petitions for review from the RTCs to the Court of Appeals (CA);
Rule 43 on appeals from quasi-judicial agencies to the CA and Rule 45 governing
appeals by certiorari to the Supreme
Court. We also said, The new rule aims
to regiment or make the appeal period uniform, to be counted from receipt of
the order denying the motion for new trial, motion for reconsideration (whether
full or partial) or any final order or resolution.[27] In other words, a party litigant may file his
notice of appeal within a fresh 15-day period from his receipt of the trial
court's decision or final order denying his motion for new trial or motion for
reconsideration. Failure to avail of the
fresh 15-day period from the denial of the motion for reconsideration makes the
decision or final order in question final and executory.
In the case at bar,
the trial court rendered its Decision on October 10, 2005. The petitioner neither filed a motion for
reconsideration nor a notice of appeal. On
December 16, 2005, or after 67 days had lapsed, the trial court issued
an order granting the respondent's motion for execution; and on February 10,
2006, or after 123 days had lapsed, the trial court issued a writ of
execution. Finally, when the writ had
already been partially executed, the petitioner, on July 7, 2006 or after 270
days had lapsed, filed his Motion for Clarification on the definition of
the net profits earned. From the
foregoing, the petitioner had clearly slept on his right to question the RTCs
Decision dated October 10, 2005. For 270
days, the petitioner never raised a single issue until the decision had already
been partially executed. Thus at the
time the petitioner filed his motion for clarification, the trial courts
decision has become final and executory.
A judgment becomes final and executory when the reglementary period to
appeal lapses and no appeal is perfected within such period. Consequently, no court, not even this Court,
can arrogate unto itself appellate jurisdiction to review a case or modify a
judgment that became final.[28]
The petitioner argues
that the decision he is questioning is a void judgment. Being such, the petitioner's thesis is that
it can still be disturbed even after 270 days had lapsed from the issuance of
the decision to the filing of the motion for clarification. He said that a void judgment is no judgment at
all. It never attains finality and
cannot be a source of any right nor any obligation.[29] But what precisely is a void judgment in our
jurisdiction? When does a judgment
becomes void?
A judgment is null
and void when the court which rendered it had no power to grant the relief or
no jurisdiction over the subject matter or over the parties or both.[30] In other words, a court, which does not have
the power to decide a case or that has no jurisdiction over the subject matter
or the parties, will issue a void judgment or a coram non judice.[31]
The questioned
judgment does not fall within the purview of a void judgment. For sure, the trial court has jurisdiction
over a case involving legal separation. Republic
Act (R.A.) No. 8369 confers upon an RTC, designated as the Family Court of a
city, the exclusive original jurisdiction to hear and decide, among others,
complaints or petitions relating to marital status and property relations of
the husband and wife or those living together.[32] The Rule on Legal Separation[33]
provides that the petition [for legal separation] shall be filed in the Family
Court of the province or city where the petitioner or the respondent has been
residing for at least six months prior to the date of filing or in the case of
a non-resident respondent, where he may be found in the Philippines, at the
election of the petitioner.[34] In the instant case, herein respondent Rita
is found to reside in Tungao,
From the aforecited
facts, the questioned October 10, 2005 judgment of the trial court is clearly
not void ab initio, since it was rendered within the ambit of the
court's jurisdiction. Being such, the
same cannot anymore be disturbed, even if the modification is meant to correct
what may be considered an erroneous conclusion of fact or law.[36] In fact, we have ruled that for [as] long as
the public respondent acted with jurisdiction, any error committed by him or it
in the exercise thereof will amount to nothing more than an error of judgment
which may be reviewed or corrected only by appeal.[37] Granting without admitting that the RTC's
judgment dated October 10, 2005 was erroneous, the petitioner's remedy should
be an appeal filed within the reglementary period. Unfortunately, the petitioner failed to do
this. He has already lost the chance to
question the trial court's decision, which has become immutable and
unalterable. What we can only do is to
clarify the very question raised below and nothing more.
For our convenience,
the following matters cannot anymore be disturbed since the October 10, 2005
judgment has already become immutable and unalterable, to wit:
(a) The finding that
the petitioner is the offending spouse since he cohabited with a woman who is
not his wife;[38]
(b) The trial court's
grant of the petition for legal separation of respondent Rita;[39]
(c) The dissolution
and liquidation of the conjugal partnership;[40]
(d) The forfeiture of
the petitioner's right to any share of the net profits earned by the conjugal
partnership;[41]
(e) The award to the
innocent spouse of the minor children's custody;[42]
(f) The
disqualification of the offending spouse from inheriting from the innocent
spouse by intestate succession;[43]
(g) The revocation of
provisions in favor of the offending spouse made in the will of the innocent
spouse;[44]
(h) The holding that
the property relation of the parties is conjugal partnership of gains and
pursuant to Article 116 of the Family Code, all properties acquired during the
marriage, whether acquired by one or both spouses, is presumed to be conjugal
unless the contrary is proved;[45]
(i) The finding that
the spouses acquired their real and personal properties while they were living
together;[46]
(j) The list of
properties which Rizal Commercial Banking Corporation (RCBC) foreclosed;[47]
(k) The list of the
remaining properties of the couple which must be dissolved and liquidated and
the fact that respondent Rita was the one who took charge of the administration
of these properties;[48]
(l) The holding that
the conjugal partnership shall be liable to matters included under Article 121
of the Family Code and the conjugal liabilities totaling P503,862.10
shall be charged to the income generated by these properties;[49]
(m) The fact that the
trial court had no way of knowing whether the petitioner had separate
properties which can satisfy his share for the support of the family;[50]
(n) The holding that
the applicable law in this case is Article 129(7);[51]
(o) The ruling that
the remaining properties not subject to any encumbrance shall therefore be
divided equally between the petitioner and the respondent without prejudice to
the children's legitime;[52]
(p) The holding that
the petitioner's share of the net profits earned by the conjugal partnership is
forfeited in favor of the common children;[53]
and
(q) The order to the
petitioner to reimburse the respondents the sum of P19,000.00 as
attorney's fees and litigation expenses of P5,000.00.[54]
After
discussing lengthily the immutability
of the Decision dated October 10, 2005, we will discuss the following issues
for the enlightenment of the parties and the public at large.
Article 129 of the Family Code applies to the present case since the
parties' property relation is governed by the system of
relative community or conjugal partnership of gains.
The petitioner claims that the court a quo is
wrong when it applied Article 129 of the Family Code, instead of Article
102. He confusingly argues that Article
102 applies because there is no other provision under the Family Code which
defines net profits earned subject of forfeiture as a result of legal
separation.
Offhand,
the trial court's Decision dated October 10, 2005 held that Article 129(7) of
the Family Code applies in this case. We
agree with the trial court's holding.
First,
let us determine what governs the couple's property relation. From the record, we can deduce that the
petitioner and the respondent tied the marital knot on January 6, 1977. Since at the time of the exchange of marital
vows, the operative law was the Civil Code of the
Art.
119. The future spouses may in the marriage settlements agree upon absolute or
relative community of property, or upon complete separation of property, or
upon any other regime. In the absence of
marriage settlements, or when the same are void, the system of relative
community or conjugal partnership of gains as established in this Code, shall
govern the property relations between husband and wife.
Thus,
from the foregoing facts and law, it is clear that what governs the property
relations of the petitioner and of the respondent is conjugal partnership of
gains. And under this property relation,
the husband and the wife place in a common fund the fruits of their separate
property and the income from their work or industry.[56] The husband and wife also own in common all
the property of the conjugal partnership of gains.[57]
Second,
since at the time of the dissolution of the petitioner and the respondent's
marriage the operative law is already the Family Code, the same applies in the
instant case and the applicable law in so far as the liquidation of the
conjugal partnership assets and liabilities is concerned is Article 129 of the
Family Code in relation to Article 63(2) of the Family Code. The latter provision is applicable because
according to Article 256 of the Family Code [t]his Code shall have retroactive
effect insofar as it does not prejudice or impair vested or acquired rights in
accordance with the Civil Code or other law.[58]
Now,
the petitioner asks: Was his vested
right over half of the common properties of the conjugal partnership violated
when the trial court forfeited them in favor of his children pursuant to
Articles 63(2) and 129 of the Family Code?
We
respond in the negative.
Indeed,
the petitioner claims that his vested rights have been impaired, arguing: As
earlier adverted to, the petitioner acquired vested rights over half of the
conjugal properties, the same being owned in common by the spouses. If the provisions of the Family Code are to
be given retroactive application to the point of authorizing the forfeiture of
the petitioner's share in the net remainder of the conjugal partnership
properties, the same impairs his rights acquired prior to the effectivity of
the Family Code.[59] In other words, the petitioner is saying that
since the property relations between the spouses is governed by the regime of
Conjugal Partnership of Gains under the Civil Code, the petitioner acquired
vested rights over half of the properties of the Conjugal Partnership of Gains,
pursuant to Article 143 of the Civil Code, which provides: All property of the
conjugal partnership of gains is owned in common by the husband and wife.[60] Thus,
since he is one of the owners of the properties covered by the conjugal
partnership of gains, he has a vested right over half of the said properties,
even after the promulgation of the Family Code; and he insisted that no
provision under the Family Code may deprive him of this vested right by virtue
of Article 256 of the Family Code which prohibits retroactive application of
the Family Code when it will prejudice a person's vested right.
However,
the petitioner's claim of vested right is not one which is written on stone. In Go, Jr. v. Court of Appeals,[61]
we define and explained vested right in the following manner:
A
vested right is one whose existence, effectivity and extent do not depend upon
events foreign to the will of the holder, or to the exercise of which no
obstacle exists, and which is immediate and perfect in itself and not dependent
upon a contingency. The term vested
right expresses the concept of present fixed interest which, in right reason
and natural justice, should be protected against arbitrary State action, or an
innately just and imperative right which enlightened free society, sensitive to
inherent and irrefragable individual rights, cannot deny.
To be
vested, a right must have become a titlelegal or equitableto the present or
future enjoyment of property.[62] (Citations
omitted)
In
our en banc Resolution dated October 18, 2005 for ABAKADA Guro Party
List Officer Samson S. Alcantara, et al. v. The Hon. Executive Secretary
Eduardo R. Ermita,[63]
we also explained:
The
concept of vested right is a consequence of the constitutional guaranty
of due process that expresses a present fixed interest which in right
reason and natural justice is protected against arbitrary state action; it
includes not only legal or equitable title to the enforcement of a demand but
also exemptions from new obligations created after the right has become
vested. Rights are considered vested
when the right to enjoyment is a present interest, absolute, unconditional, and
perfect or fixed and irrefutable.[64] (Emphasis and
underscoring supplied)
From
the foregoing, it is clear that while one may not be deprived of his vested
right, he may lose the same if there is due process and such deprivation is
founded in law and jurisprudence.
In
the present case, the petitioner was accorded his right to due process. First, he was well-aware that the
respondent prayed in her complaint that all of the conjugal properties be
awarded to her.[65] In fact, in his Answer, the petitioner prayed
that the trial court divide the community assets between the petitioner and the
respondent as circumstances and evidence warrant after the accounting and
inventory of all the community properties of the parties.[66] Second, when the Decision dated
October 10, 2005 was promulgated, the petitioner never questioned the trial
court's ruling forfeiting what the trial court termed as net profits,
pursuant to Article 129(7) of the Family Code.[67] Thus, the petitioner cannot claim being
deprived of his right to due process.
Furthermore,
we take note that the alleged deprivation of the petitioner's vested right is
one founded, not only in the provisions of the Family Code, but in Article 176
of the Civil Code. This provision is
like Articles 63 and 129 of the Family Code on the forfeiture of the guilty spouse's
share in the conjugal partnership profits.
The said provision says:
Art.
176. In case of legal separation, the
guilty spouse shall forfeit his or her share of the conjugal partnership
profits, which shall be awarded to the children of both, and the children of
the guilty spouse had by a prior marriage.
However, if the conjugal partnership property came mostly or entirely
from the work or industry, or from the wages and salaries, or from the fruits
of the separate property of the guilty spouse, this forfeiture shall not apply.
In
case there are no children, the innocent spouse shall be entitled to all the
net profits.
From
the foregoing, the petitioner's claim of a vested right has no basis
considering that even under Article 176 of the Civil Code, his share of the
conjugal partnership profits may be forfeited if he is the guilty party in a
legal separation case. Thus, after trial
and after the petitioner was given the chance to present his evidence, the petitioner's
vested right claim may in fact be set aside under the Civil Code since the
trial court found him the guilty party.
More,
in Abalos v. Dr. Macatangay, Jr.,[68]
we reiterated our long-standing ruling that:
[P]rior
to the liquidation of the conjugal partnership, the
interest of each spouse in the conjugal assets is inchoate, a mere expectancy,
which constitutes neither a legal nor an equitable estate, and does not ripen
into title until it appears that there are assets in the community as a result
of the liquidation and settlement. The
interest of each spouse is limited to the net remainder or remanente liquido (haber ganancial) resulting from the liquidation of the affairs of
the partnership after its dissolution. Thus,
the right of the husband or wife to one-half of the conjugal assets does not
vest until the dissolution and liquidation of the conjugal partnership, or after dissolution of the marriage, when it is
finally determined that, after settlement of conjugal obligations, there are
net assets left which can be divided between the spouses or their respective
heirs.[69] (Citations
omitted)
Finally,
as earlier discussed, the trial court has already decided in its Decision dated
October 10, 2005 that the applicable law in this case is Article 129(7) of the
Family Code.[70] The petitioner
did not file a motion for reconsideration nor a notice of appeal. Thus, the
petitioner is now precluded from questioning the trial court's decision since
it has become final and executory. The doctrine of immutability and
unalterability of a final judgment prevents us from disturbing the Decision
dated October 10, 2005 because final and executory decisions can no longer be
reviewed nor reversed by this Court.[71]
From the above discussions, Article 129 of the Family Code clearly
applies to the present case since the parties' property relation is governed by
the system of relative community or conjugal partnership of
gains and since the trial court's
Decision has attained finality and immutability.
The net profits of the conjugal partnership of gains are all the fruits
of the separate properties of the spouses and the products of their labor and
industry.
The petitioner inquires from us the meaning of net
profits earned by the conjugal partnership for purposes of effecting the
forfeiture authorized under Article 63 of the Family Code. He insists that since there is no other
provision under the Family Code, which defines net profits earned subject of
forfeiture as a result of legal separation, then Article 102 of the Family Code
applies.
What does Article 102 of the Family Code say? Is the computation of net profits earned in
the conjugal partnership of gains the same with the computation of net
profits earned in the absolute community?
Now, we clarify.
First and foremost, we must distinguish between the
applicable law as to the property relations between the parties and the
applicable law as to the definition of net profits. As earlier discussed,
Article 129 of the Family Code applies as to the property relations of the
parties. In other words, the computation and the succession of events will
follow the provisions under Article 129 of the said Code. Moreover, as to the
definition of net profits, we cannot but refer to Article 102(4) of the
Family Code, since it expressly provides that for purposes of computing the net
profits subject to forfeiture under Article 43, No. (2) and Article 63, No.
(2), Article 102(4) applies. In this provision, net profits shall be the
increase in value between the market value of the community property at the time
of the celebration of the marriage and the market value at the time of its
dissolution.[72]
Thus, without any iota of doubt, Article 102(4) applies to both the dissolution
of the absolute community regime under Article 102 of the Family Code, and to
the dissolution of the conjugal partnership regime under Article 129 of the
Family Code. Where lies the difference? As earlier shown, the difference lies
in the processes used under the dissolution of the absolute community regime
under Article 102 of the Family Code, and in the processes used under the
dissolution of the conjugal partnership regime under Article 129 of the Family
Code.
Let us now discuss the difference in the processes
between the absolute community regime and the conjugal partnership regime.
On Absolute Community Regime:
When a couple enters into a regime of absolute
community, the husband and the wife becomes joint owners of all the
properties of the marriage. Whatever property each spouse brings into the
marriage, and those acquired during the marriage (except those excluded under
Article 92 of the Family Code) form the common mass of the couple's properties.
And when the couple's marriage or community is dissolved, that common mass is
divided between the spouses, or their respective heirs, equally or in the
proportion the parties have established, irrespective of the value each one may
have originally owned.[73]
Under Article 102 of the Family Code, upon
dissolution of marriage, an inventory is prepared, listing separately all the
properties of the absolute community and the exclusive properties of each; then
the debts and obligations of the absolute community are paid out of the
absolute community's assets and if the community's properties are insufficient,
the separate properties of each of the couple will be solidarily liable for the
unpaid balance. Whatever is left of the separate properties will be delivered
to each of them. The net remainder of the absolute community is its net assets,
which shall be divided between the husband and the wife; and for purposes of
computing the net profits subject to forfeiture, said profits shall be the
increase in value between the market value of the community property at the
time of the celebration of the marriage and the market value at the time of its
dissolution.[74]
Applying Article 102 of the Family Code, the net
profits requires that we first find the market value of the properties at the
time of the community's dissolution. From
the totality of the market value of all the properties, we subtract the debts
and obligations of the absolute community and this result to the net assets or
net remainder of the properties of the absolute community, from which we deduct
the market value of the properties at the time of marriage, which then results
to the net profits.[75]
Granting without admitting that Article 102 applies
to the instant case, let us see what will happen if we apply Article 102:
(a) According to the trial court's finding of
facts, both husband and wife have no separate properties, thus, the remaining
properties in the list above are all part of the absolute community. And its market value at the time of the
dissolution of the absolute community constitutes the market value at
dissolution.
(b) Thus, when the petitioner and the respondent
finally were legally separated, all the properties which remained will be
liable for the debts and obligations of the community. Such debts and obligations will be subtracted
from the market value at dissolution.
(c) What remains after the debts and obligations
have been paid from the total assets of the absolute community constitutes the
net remainder or net asset. And from
such net asset/remainder of the petitioner and respondent's remaining
properties, the market value at the time of marriage will be subtracted and the
resulting totality constitutes the net profits.
(d) Since both husband and wife have no
separate properties, and nothing would be returned to each of them,
what will be divided equally between them is simply the net profits. However, in the Decision dated October 10,
2005, the trial court forfeited the half-share of the petitioner in favor of
his children. Thus, if we use Article
102 in the instant case (which should not be the case), nothing is left to the
petitioner since both parties entered into their marriage without bringing with
them any property.
On Conjugal Partnership Regime:
Before we go into our disquisition on the Conjugal
Partnership Regime, we make it clear that Article 102(4) of the Family Code
applies in the instant case for purposes only of defining net profit.
As earlier explained, the definition of net profits in Article 102(4)
of the Family Code applies to both the absolute community regime and conjugal
partnership regime as provided for under Article 63, No. (2) of the Family
Code, relative to the provisions on Legal Separation.
Now, when a couple enters into a regime of
conjugal partnership of gains under Article 142 of the Civil Code, the
husband and the wife place in common fund the fruits of their separate property
and income from their work or industry, and divide equally, upon the
dissolution of the marriage or of the partnership, the net gains or benefits
obtained indiscriminately by either spouse during the marriage.[76] From the foregoing provision, each of the
couple has his and her own property and debts.
The law does not intend to effect a mixture or merger of those debts or properties
between the spouses. Rather, it
establishes a complete separation of capitals.[77]
Considering that the couple's marriage has been
dissolved under the Family Code, Article 129 of the same Code applies in the
liquidation of the couple's properties in the event that
the conjugal partnership of gains is dissolved, to wit:
Art. 129. Upon the dissolution of the conjugal partnership regime,
the following procedure shall apply:
(1) An inventory shall be prepared, listing separately all the
properties of the conjugal partnership and the exclusive properties of each
spouse.
(2) Amounts advanced by the conjugal partnership in payment of
personal debts and obligations of either spouse shall be credited to the
conjugal partnership as an asset thereof.
(3) Each spouse shall be reimbursed for the use of his or her
exclusive funds in the acquisition of property or for the value of his or her
exclusive property, the ownership of which has been vested by law in the
conjugal partnership.
(4) The debts and obligations of the conjugal partnership shall be
paid out of the conjugal assets. In case
of insufficiency of said assets, the spouses shall be solidarily liable for the
unpaid balance with their separate properties, in accordance with the
provisions of paragraph (2) of Article 121.
(5) Whatever remains of the exclusive properties of the spouses
shall thereafter be delivered to each of them.
(6) Unless the owner had been indemnified from whatever source,
the loss or deterioration of movables used for the benefit of the family,
belonging to either spouse, even due to fortuitous event, shall be paid to said
spouse from the conjugal funds, if any.
(7) The net remainder of the conjugal partnership properties shall
constitute the profits, which shall be divided equally between husband and
wife, unless a different proportion or division was agreed upon in the marriage
settlements or unless there has been a voluntary waiver or forfeiture of such
share as provided in this Code.
(8) The presumptive legitimes of the common children shall be
delivered upon the partition in accordance with Article 51.
(9) In the partition of the properties, the conjugal dwelling and
the lot on which it is situated shall, unless otherwise agreed upon by the
parties, be adjudicated to the spouse with whom the majority of the common
children choose to remain. Children
below the age of seven years are deemed to have chosen the mother, unless the
court has decided otherwise. In case
there is no such majority, the court shall decide, taking into consideration
the best interests of said children.
In
the normal course of events, the following are the steps in the liquidation of
the properties of the spouses:
(a)
An inventory of all the actual properties shall be made, separately listing the
couple's conjugal properties and their separate properties.[78] In the instant case, the trial court
found that the couple has no separate properties when they married.[79] Rather, the trial court identified the
following conjugal properties, to wit:
1.
coffee mill in Balongagan, Las Nieves, Agusan del Norte;
2.
coffee mill in Durian, Las Nieves, Agusan del Norte;
3. corn
mill in Casiklan, Las Nieves, Agusan del Norte;
4.
coffee mill in Esperanza, Agusan del Sur;
5. a
parcel of land with an area of 1,200 square meters located in Tungao,
6. a
parcel of agricultural land with an area of 5 hectares located in Manila de
Bugabos,
7. a
parcel of land with an area of 84 square meters located in Tungao,
8.
Bashier Bon Factory located in Tungao,
(b)
Ordinarily, the benefit received by a spouse from the conjugal partnership
during the marriage is returned in equal amount to the assets of the conjugal
partnership;[81] and if the community is enriched at the
expense of the separate properties of either spouse, a restitution of the value
of such properties to their respective owners shall be made.[82]
(c)
Subsequently, the couple's conjugal partnership shall pay the debts of the
conjugal partnership; while the debts and obligation of each of the spouses
shall be paid from their respective separate properties. But if the conjugal partnership is not
sufficient to pay all its debts and obligations, the spouses with their
separate properties shall be solidarily liable.[83]
(d)
Now, what remains of the separate or exclusive properties of the husband and of
the wife shall be returned to each of them.[84] In the instant case, since it was
already established by the trial court that the spouses have no separate
properties,[85]
there is nothing to return to any of them. The listed properties above are
considered part of the conjugal partnership. Thus, ordinarily, what remains in the
above-listed properties should be divided equally between the spouses and/or
their respective heirs.[86] However, since the trial court found the
petitioner the guilty party, his share from the net profits of the conjugal
partnership is forfeited in favor of the common children, pursuant to Article
63(2) of the Family Code. Again, lest we
be confused, like in the absolute community regime, nothing will be returned to
the guilty party in the conjugal partnership regime, because there is no
separate property which may be accounted for in the guilty party's favor.
In
the discussions above, we have seen that in both instances, the petitioner is
not entitled to any property at all. Thus,
we cannot but uphold the Decision dated October 10, 2005 of the trial
court. However, we must clarify, as we
already did above, the Order dated January 8, 2007.
WHEREFORE, the Decision dated October 10, 2005 of the Regional Trial Court,
Branch 1 of Butuan City is AFFIRMED. Acting on the Motion for Clarification dated
July 7, 2006 in the Regional Trial Court, the Order dated January 8, 2007 of
the Regional Trial Court is hereby CLARIFIED
in accordance with the above discussions.
SO ORDERED.
BIENVENIDO
L. REYES
Associate
Justice
WE
CONCUR:
ANTONIO
T. CARPIO
Senior
Associate Justice
Chairperson,
Second Division
|
ARTURO D. BRION Associate
Justice |
JOSE Associate
Justice |
MARIA
Associate
Justice
C E R T I F I C A T I O N
I
certify that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Courts Division.
ANTONIO
T. CARPIO
Senior Associate Justice
(Per Section 12, R.A. 296
The Judiciary Act of 1948, as amended)
[1] Rollo,
pp. 7-35.
[2] Penned by Judge Eduardo S. Casals;
id. at 115-122.
[3]
[4]
[5]
[6] A.M.
No. 02-11-11-SC.
[7] Rollo, p. 185.
[8]
[9]
[10]
[11]
[12]
[13]
[14]
[15]
[16]
[17]
[18]
[19]
[20]
[21]
[22]
[23]
[24]
[25] 506
Phil. 613, 629 (2005).
[26]
[27]
[28] PCI
Leasing and Finance, Inc., v.
[29] Rollo, p. 166.
[30] See
[31] People
v. Judge Navarro,
159 Phil. 863, 874 (1975).
[32] R.A.
No. 8369, Section 5(d).
[33] A.M. No. 02-11-11-SC.
[34]
[35] Rollo, p. 38.
[36] Sps.
Edillo v. Sps. Dulpina,
G.R. No. 188360, January 21, 2010, 610 SCRA 590, 601-602.
[37] Lim
v. Judge Vianzon,
529 Phil. 472, 483-484 (2006); See also Herrera v. Barretto and Joaquin,
25 Phil. 245, 256 (1913), citing Miller v. Rowan, 251
[38] Rollo, pp. 50-51.
[39]
[40]
[41]
[42]
[43]
[44]
[45]
[46]
[47]
[48]
[49]
[50]
[51]
[52]
[53]
[54]
[55] Civil Code
of the
[56]
[57]
[58] Family Code
of the
[59] Rollo, p. 29.
[60] Civil Code
of the
[61] G.R.
No. 172027, July 29, 2010, 626 SCRA 180, 201.
[62]
[63] The
Court consolidated the following cases: ABAKADA Guro Party List Officer
Samson S. Alcantara, et al. v. The Hon. Executive Secretary Eduardo R. Ermita,
G.R. No. 168056; Aquilino Q. Pimentel, Jr., et al. v. Executive Secretary
Eduardo R. Ermita, et al., G.R. No. 168207; Association of Pilipinas
Shell Dealers, Inc., et al. v. Cesar V. Purisima, et al., G.R. No. 168461; Francis
Joseph G. Escudero v. Cesar V. Purisima, et al, G.R. No. 168463; and Bataan Governor Enrique T. Garcia, Jr. v. Hon.
Eduardo R. Ermita, et al., G.R. No. 168730.
[64]
[65] Rollo, p. 37.
[66]
[67]
[68] 482
Phil. 877-894 (2004).
[69]
[70] Rollo, p. 55.
[71] Malayan
Employees Association-FFW v. Malayan Insurance Co., Inc., G.R. No. 181357,
February 2, 2010, 611 SCRA 392, 399; Catmon Sales Int'l. Corp. v. Atty.
Yngson, Jr., G.R. No. 179761, January 15, 2010, 610 SCRA 236, 245.
[72] Family Code
of the
[73]
[74] Family Code
of the
[75] Tolentino,
Arturo, M., Commentaries and
Jurisprudence on the Civil Code of the
[76] Civil Code
of the
[77] Tolentino,
Arturo, M., Commentaries and
Jurisprudence on the Civil Code of the
[78] Tolentino,
Arturo, M., Commentaries and
Jurisprudence on the Civil Code of the
[79] Rollo, p. 55.
[80]
[81] Family Code
of the
[82]
[83]
[84]
[85] Rollo, p. 55.
[86] Family Code
of the