G.R. No. 118305 February 12, 1998
AYALA INVESTMENT & DEVELOPMENT CORP. and ABELARDO MAGSAJO, petitioners, vs. COURT OF APPEALS and SPOUSES ALFREDO & ENCARNACION CHING, respondents.
MARTINEZ, J.:
Under Article 161 of the Civil Code, what debts and obligations contracted by the husband alone are considered "for the benefit of the conjugal partnership" which are chargeable against the conjugal partnership? Is a surety agreement or an accommodation contract entered into by the husband in favor of his employer within the contemplation of the said provision?
These are the issues which we will resolve in this petition for review.
The petitioner assails the decision dated April 14, 1994 of the respondent Court of Appeals in "Spouses Alfredo and Encarnacion Ching vs. Ayala Investment and Development Corporation, et. al.," docketed as CA-G.R. CV No. 29632, 1 upholding the decision of the Regional Trial Court of Pasig, Branch 168, which ruled that the conjugal partnership of gains of respondents-spouses Alfredo and Encarnacion Ching is not liable for the payment of the debts secured by respondent-husband Alfredo Ching.
A chronology of the essential antecedent facts is necessary for a clear understanding of the case at bar.
Philippine Blooming Mills (hereinafter referred to as PBM) obtained a P50,300,000.00 loan from petitioner Ayala Investment and Development Corporation (hereinafter referred to as AIDC). As added security for the credit line extended to PBM, respondent Alfredo Ching, Executive Vice President of PBM, executed security agreements on December 10, 1980 and on March 20, 1981 making himself jointly and severally answerable with PBM's indebtedness to AIDC.
PBM failed to pay the loan. Thus, on July 30, 1981, AIDC filed a case for sum of money against PBM and respondent-husband Alfredo Ching with the then Court of First Instance of Rizal (Pasig), Branch VIII, entitled "Ayala Investment and Development Corporation vs. Philippine Blooming Mills and Alfredo Ching," docketed as Civil Case No. 42228.
After trial, the court rendered judgment ordering PBM and respondent-husband Alfredo Ching to jointly and severally pay AIDC the principal amount of P50,300,000.00 with interests.
Pending appeal of the judgment in Civil Case No. 42228, upon motion of AIDC, the lower court issued a writ of execution pending appeal. Upon AIDC's putting up of an P8,000,000.00 bond, a writ of execution dated May 12, 1982 was issued. Thereafter, petitioner Abelardo Magsajo, Sr., Deputy Sheriff of Rizal and appointed sheriff in Civil Case No. 42228, caused the issuance and service upon respondents-spouses of a notice of sheriff sale dated May 20, 1982 on three (3) of their conjugal properties. Petitioner Magsajo then scheduled the auction sale of the properties levied.
On June 9, 1982, private respondents filed a case of injunction against petitioners with the then Court of First Instance of Rizal (Pasig), Branch XIII, to enjoin the auction sale alleging that petitioners cannot enforce the judgment against the conjugal partnership levied on the ground that, among others, the subject loan did not redound to the benefit of the said conjugal partnership. 2 Upon application of private respondents, the lower court issued a temporary restraining order to prevent petitioner Magsajo from proceeding with the enforcement of the writ of execution and with the sale of the said properties at public auction.
AIDC filed a petition for certiorari before the Court of Appeals, 3 questioning the order of the lower court enjoining the sale. Respondent Court of Appeals issued a Temporary Restraining Order on June 25, 1982, enjoining the lower court 4 from enforcing its Order of June 14, 1982, thus paving the way for the scheduled auction sale of respondents-spouses conjugal properties.
On June 25, 1982, the auction sale took place. AIDC being the only bidder, was issued a Certificate of Sale by petitioner Magsajo, which was registered on July 2, 1982. Upon expiration of the redemption period, petitioner sheriff issued the final deed of sale on August 4, 1982 which was registered on August 9, 1983.
In the meantime, the respondent court, on August 4, 1982, decided CA-G.R. SP No. 14404, in this manner:
WHEREFORE, the petition for certiorari in this case is granted and the challenged order of the respondent Judge dated June 14, 1982 in Civil Case No. 46309 is hereby set aside and nullified. The same petition insofar as it seeks to enjoin the respondent Judge from proceeding with Civil Case No. 46309 is, however, denied. No pronouncement is here made as to costs. . . . 5
On September 3, 1983, AIDC filed a motion to dismiss the petition for injunction filed before Branch XIII of the CFI of Rizal (Pasig) on the ground that the same had become moot and academic with the consummation of the sale. Respondents filed their opposition to the motion arguing, among others, that where a third party who claim is ownership of the property attached or levied upon, a different legal situation is presented; and that in this case, two (2) of the real properties are actually in the name of Encarnacion Ching, a non-party to Civil Case No. 42228.
The lower court denied the motion to dismiss. Hence, trial on the merits proceeded. Private respondents presented several witnesses. On the other hand, petitioners did not present any evidence.
On September 18, 1991, the trial court promulgated its decision declaring the sale on execution null and void. Petitioners appealed to the respondent court, which was docketed as CA-G.R. CV No. 29632.
On April 14, 1994, the respondent court promulgated the assailed decision, affirming the decision of the regional trial court. It held that:
The loan procured from respondent-appellant AIDC was for the advancement and benefit of Philippine Blooming Mills and not for the benefit of the conjugal partnership of petitioners-appellees. xxx xxx xxx
As to the applicable law, whether it is Article 161 of the New Civil Code or Article 1211 of the Family Code-suffice it to say that the two provisions are substantially the same. Nevertheless, We agree with the trial court that the Family Code is the applicable law on the matter . . . . . . .
Article 121 of the Family Code provides that "The conjugal partnership shall be liable for: . . . (2) All debts and obligations contracted during the marriage by the designated Administrator-Spouse for the benefit of the conjugal partnership of gains . . . ." The burden of proof that the debt was contracted for the benefit of the conjugal partnership of gains, lies with the creditor-party litigant claiming as such. In the case at bar, respondent-appellant AIDC failed to prove that the debt was contracted by appellee-husband, for the benefit of the conjugal partnership of gains.
The dispositive portion of the decision reads:
WHEREFORE, in view of all the foregoing, judgment is hereby rendered DISMISSING the appeal. The decision of the Regional Trial Court is AFFIRMED in toto. 6
Petitioner filed a Motion for Reconsideration which was denied by the respondent court in a Resolution dated November 28, 1994. 7
Hence, this petition for review. Petitioner contends that the "respondent court erred in ruling that the conjugal partnership of private respondents is not liable for the obligation by the respondent-husband."
Specifically, the errors allegedly committed by the respondent court are as follows:
I. RESPONDENT COURT ERRED IN RULING THAT THE OBLIGATION INCURRED RESPONDENT HUSBAND DID NOT REDOUND TO THE BENEFIT OF THE CONJUGAL PARTNERSHIP OF THE PRIVATE RESPONDENT.
II. RESPONDENT COURT ERRED IN RULING THAT THE ACT OF RESPONDENT HUSBAND IN SECURING THE SUBJECT LOAN IS NOT PART OF HIS INDUSTRY, BUSINESS OR CAREER FROM WHICH HE SUPPORTS HIS FAMILY.
Petitioners in their appeal point out that there is no need to prove that actual benefit redounded to the benefit of the partnership; all that is necessary, they say, is that the transaction was entered into for the benefit of the conjugal partnership. Thus, petitioners aver that:
The wordings of Article 161 of the Civil Code is very clear: for the partnership to be held liable, the husband must have contracted the debt "for the benefit of the partnership, thus:
Art. 161. The conjugal partnership shall be liable for:
1) all debts and obligations contracted by the husband for the benefit of the conjugal partnership . . . .
There is a difference between the phrases: "redounded to the benefit of" or "benefited from" (on the one hand) and "for the benefit of (on the other). The former require that actual benefit must have been realized; the latter requires only that the transaction should be one which normally would produce benefit to the partnership, regardless of whether or not actual benefit accrued. 8
We do not agree with petitioners that there is a difference between the terms "redounded to the benefit of" or "benefited from" on the one hand; and "for the benefit of" on the other. They mean one and the same thing. Article 161 (1) of the Civil Code and Article 121 (2) of the Family Code are similarly worded, i.e., both use the term "for the benefit of." On the other hand, Article 122 of the Family Code provides that "The payment of personal debts by the husband or the wife before or during the marriage shall not be charged to the conjugal partnership except insofar as they redounded to the benefit of the family." As can be seen, the terms are used interchangeably.
Petitioners further contend that the ruling of the respondent court runs counter to the pronouncement of this Court in the case of Cobb-Perez vs. Lantin, 9 that the husband as head of the family and as administrator of the conjugal partnership is presumed to have contracted obligations for the benefit of the family or the conjugal partnership.
Contrary to the contention of the petitioners, the case of Cobb-Perez is not applicable in the case at bar. This Court has, on several instances, interpreted the term "for the benefit of the conjugal partnership."
In the cases of Javier vs. Osmeña, 10 Abella de Diaz vs. Erlanger & Galinger, Inc., 11 Cobb-Perez vs. Lantin 12 and G-Tractors, Inc. vs. Court of Appeals, 13 cited by the petitioners, we held that:
The debts contracted by the husband during the marriage relation, for and in the exercise of the industry or profession by which he contributes toward the support of his family, are not his personal and private debts, and the products or income from the wife's own property, which, like those of her husband's, are liable for the payment of the marriage expenses, cannot be excepted from the payment of such debts. (Javier)
The husband, as the manager of the partnership (Article 1412, Civil Code), has a right to embark the partnership in an ordinary commercial enterprise for gain, and the fact that the wife may not approve of a venture does not make it a private and personal one of the husband. (Abella de Diaz)
Debts contracted by the husband for and in the exercise of the industry or profession by which he contributes to the support of the family, cannot be deemed to be his exclusive and private debts. (Cobb-Perez).
. . . if he incurs an indebtedness in the legitimate pursuit of his career or profession or suffers losses in a legitimate business, the conjugal partnership must equally bear the indebtedness and the losses, unless he deliberately acted to the prejudice of his family. (G-Tractors)
However, in the cases of Ansaldo vs. Sheriff of Manila, Fidelity Insurance & Luzon Insurance Co., 14 Liberty Insurance Corporation vs. Banuelos, 15 and Luzon Surety Inc. vs. De Garcia, 16 cited by the respondents, we ruled that:
The fruits of the paraphernal property which form part of the assets of the conjugal partnership, are subject to the payment of the debts and expenses of the spouses, but not to the payment of the personal obligations (guaranty agreements) of the husband, unless it be proved that such obligations were productive of some benefit to the family." (Ansaldo; parenthetical phrase ours.)
When there is no showing that the execution of an indemnity agreement by the husband redounded to the benefit of his family, the undertaking is not a conjugal debt but an obligation personal to him. (Liberty Insurance)
In the most categorical language, a conjugal partnership under Article 161 of the new Civil Code is liable only for such "debts and obligations contracted by the husband for the benefit of the conjugal partnership." There must be the requisite showing then of some advantage which clearly accrued to the welfare of the spouses. Certainly, to make a conjugal partnership respond for a liability that should appertain to the husband alone is to defeat and frustrate the avowed objective of the new Civil Code to show the utmost concern for the solidarity and well-being of the family as a unit. The husband, therefore, is denied the power to assume unnecessary and unwarranted risks to the financial stability of the conjugal partnership. (Luzon Surety, Inc.)
From the foregoing jurisprudential rulings of this Court, we can derive the following conclusions:
(A) If the husband himself is the principal obligor in the contract, i.e., he directly received the money and services to be used in or for his own business or his own profession, that contract falls within the term . . . . obligations for the benefit of the conjugal partnership." Here, no actual benefit may be proved. It is enough that the benefit to the family is apparent at the time of the signing of the contract. From the very nature of the contract of loan or services, the family stands to benefit from the loan facility or services to be rendered to the business or profession of the husband. It is immaterial, if in the end, his business or profession fails or does not succeed. Simply stated, where the husband contracts obligations on behalf of the family business, the law presumes, and rightly so, that such obligation will redound to the benefit of the conjugal partnership.
(B) On the other hand, if the money or services are given to another person or entity, and the husband acted only as a surety or guarantor, that contract cannot, by itself, alone be categorized as falling within the context of "obligations for the benefit of the conjugal partnership." The contract of loan or services is clearly for the benefit of the principal debtor and not for the surety or his family. No presumption can be inferred that, when a husband enters into a contract of surety or accommodation agreement, it is "for the benefit of the conjugal partnership." Proof must be presented to establish benefit redounding to the conjugal partnership.
Thus, the distinction between the Cobb-Perez case, and we add, that of the three other companion cases, on the one hand, and that of Ansaldo, Liberty Insurance and Luzon Surety, is that in the former, the husband contracted the obligation for his own business; while in the latter, the husband merely acted as a surety for the loan contracted by another for the latter's business.
The evidence of petitioner indubitably show that co-respondent Alfredo Ching signed as surety for the P50M loan contracted on behalf of PBM. petitioner should have adduced evidence to prove that Alfredo Ching's acting as surety redounded to the benefit of the conjugal partnership. The reason for this is as lucidly explained by the respondent court:
The loan procured from respondent-appellant AIDC was for the advancement and benefit of Philippine Blooming Mills and not for the benefit of the conjugal partnership of petitioners-appellees. Philippine Blooming Mills has a personality distinct and separate from the family of petitioners-appellees — this despite the fact that the members of the said family happened to be stockholders of said corporate entity. xxx xxx xxx
. . . . The burden of proof that the debt was contracted for the benefit of the conjugal partnership of gains, lies with the creditor-party litigant claiming as such. In the case at bar, respondent-appellant AIDC failed to prove that the debt was contracted by appellee-husband, for the benefit of the conjugal partnership of gains. What is apparent from the facts of the case is that the judgment debt was contracted by or in the name of the Corporation Philippine Blooming Mills and appellee-husband only signed as surety thereof. The debt is clearly a corporate debt and respondent-appellant's right of recourse against appellee-husband as surety is only to the extent of his corporate stockholdings. It does not extend to the conjugal partnership of gains of the family of petitioners-appellees. . . . . . . 17
Petitioners contend that no actual benefit need accrue to the conjugal partnership. To support this contention, they cite Justice J.B.L. Reyes' authoritative opinion in the Luzon Surety Company case:
I concur in the result, but would like to make of record that, in my opinion, the words "all debts and obligations contracted by the husband for the benefit of the conjugal partnership" used in Article 161 of the Civil Code of the Philippines in describing the charges and obligations for which the conjugal partnership is liable do not require that actual profit or benefit must accrue to the conjugal partnership from the husband's transaction; but it suffices that the transaction should be one that normally would produce such benefit for the partnership. This is the ratio behind our ruling in Javier vs. Osmeña, 34 Phil. 336, that obligations incurred by the husband in the practice of his profession are collectible from the conjugal partnership.
The aforequoted concurring opinion agreed with the majority decision that the conjugal partnership should not be made liable for the surety agreement which was clearly for the benefit of a third party. Such opinion merely registered an exception to what may be construed as a sweeping statement that in all cases actual profit or benefit must accrue to the conjugal partnership. The opinion merely made it clear that no actual benefits to the family need be proved in some cases such as in the Javier case. There, the husband was the principal obligor himself. Thus, said transaction was found to be "one that would normally produce . . . benefit for the partnership." In the later case of G-Tractors, Inc., the husband was also the principal obligor — not merely the surety. This latter case, therefore, did not create any precedent. It did not also supersede the Luzon Surety Company case, nor any of the previous accommodation contract cases, where this Court ruled that they were for the benefit of third parties.
But it could be argued, as the petitioner suggests, that even in such kind of contract of accommodation, a benefit for the family may also result, when the guarantee is in favor of the husband's employer.
In the case at bar, petitioner claims that the benefits the respondent family would reasonably anticipate were the following:
(a) The employment of co-respondent Alfredo Ching would be prolonged and he would be entitled to his monthly salary of P20,000.00 for an extended length of time because of the loan he guaranteed;
(b) The shares of stock of the members of his family would appreciate if the PBM could be rehabilitated through the loan obtained;
(c) His prestige in the corporation would be enhanced and his career would be boosted should PBM survive because of the loan.
However, these are not the benefits contemplated by Article 161 of the Civil Code. The benefits must be one directly resulting from the loan. It cannot merely be a by-product or a spin-off of the loan itself.
In all our decisions involving accommodation contracts of the husband, 18 we underscored the requirement that: "there must be the requisite showing . . . of some advantage which clearly accrued to the welfare of the spouses" or "benefits to his family" or "that such obligations are productive of some benefit to the family." Unfortunately, the petition did not present any proof to show: (a) Whether or not the corporate existence of PBM was prolonged and for how many months or years; and/or (b) Whether or not the PBM was saved by the loan and its shares of stock appreciated, if so, how much and how substantial was the holdings of the Ching family.
Such benefits (prospects of longer employment and probable increase in the value of stocks) might have been already apparent or could be anticipated at the time the accommodation agreement was entered into. But would those "benefits" qualify the transaction as one of the "obligations . . . for the benefit of the conjugal partnership"? Are indirect and remote probable benefits, the ones referred to in Article 161 of the Civil Code? The Court of Appeals in denying the motion for reconsideration, disposed of these questions in the following manner:
No matter how one looks at it, the debt/credit respondents-appellants is purely a corporate debt granted to PBM, with petitioner-appellee-husband merely signing as surety. While such petitioner-appellee-husband, as such surety, is solidarily liable with the principal debtor AIDC, such liability under the Civil Code provisions is specifically restricted by Article 122 (par. 1) of the Family Code, so that debts for which the husband is liable may not be charged against conjugal partnership properties. Article 122 of the Family Code is explicit — "The payment of personal debts contracted by the husband or the wife before or during the marriage shall not be charged to the conjugal partnership except insofar as they redounded to the benefit of the family.
Respondents-appellants insist that the corporate debt in question falls under the exception laid down in said Article 122 (par. one). We do not agree. The loan procured from respondent-appellant AIDC was for the sole advancement and benefit of Philippine Blooming Mills and not for the benefit of the conjugal partnership of petitioners-appellees.
. . . appellee-husband derives salaries, dividends benefits from Philippine Blooming Mills (the debtor corporation), only because said husband is an employee of said PBM. These salaries and benefits, are not the "benefits" contemplated by Articles 121 and 122 of the Family Code. The "benefits" contemplated by the exception in Article 122 (Family Code) is that benefit derived directly from the use of the loan. In the case at bar, the loan is a corporate loan extended to PBM and used by PBM itself, not by petitioner-appellee-husband or his family. The alleged benefit, if any, continuously harped by respondents-appellants, are not only incidental but also speculative. 19
We agree with the respondent court. Indeed, considering the odds involved in guaranteeing a large amount (P50,000,000.00) of loan, the probable prolongation of employment in PBM and increase in value of its stocks, would be too small to qualify the transaction as one "for the benefit" of the surety's family. Verily, no one could say, with a degree of certainty, that the said contract is even "productive of some benefits" to the conjugal partnership.
We likewise agree with the respondent court (and this view is not contested by the petitioners) that the provisions of the Family Code is applicable in this case. These provisions highlight the underlying concern of the law for the conservation of the conjugal partnership; for the husband's duty to protect and safeguard, if not augment, not to dissipate it.
This is the underlying reason why the Family Code clarifies that the obligations entered into by one of the spouses must be those that redounded to the benefit of the family and that the measure of the partnership's liability is to "the extent that the family is benefited." 20
These are all in keeping with the spirit and intent of the other provisions of the Civil Code which prohibits any of the spouses to donate or convey gratuitously any part of the conjugal property. 21 Thus, when co-respondent Alfredo Ching entered into a surety agreement he, from then on, definitely put in peril the conjugal property (in this case, including the family home) and placed it in danger of being taken gratuitously as in cases of donation.
In the second assignment of error, the petitioner advances the view that acting as surety is part of the business or profession of the respondent-husband.
This theory is new as it is novel.
The respondent court correctly observed that:
Signing as a surety is certainly not an exercise of an industry or profession, hence the cited cases of Cobb-Perez vs. Lantin; Abella de Diaz vs. Erlanger & Galinger; G-Tractors, Inc. vs. CA do not apply in the instant case. Signing as a surety is not embarking in a business. 22
We are likewise of the view that no matter how often an executive acted or was persuaded to act, as a surety for his own employer, this should not be taken to mean that he had thereby embarked in the business of suretyship or guaranty.
This is not to say, however, that we are unaware that executives are often asked to stand as surety for their company's loan obligations. This is especially true if the corporate officials have sufficient property of their own; otherwise, their spouses' signatures are required in order to bind the conjugal partnerships.
The fact that on several occasions the lending institutions did not require the signature of the wife and the husband signed alone does not mean that being a surety became part of his profession. Neither could he be presumed to have acted for the conjugal partnership.
Article 121, paragraph 3, of the Family Code is emphatic that the payment of personal debts contracted by the husband or the wife before or during the marriage shall not be charged to the conjugal partnership except to the extent that they redounded to the benefit of the family.
Here, the property in dispute also involves the family home. The loan is a corporate loan not a personal one. Signing as a surety is certainly not an exercise of an industry or profession nor an act of administration for the benefit of the family.
On the basis of the facts, the rules, the law and equity, the assailed decision should be upheld as we now uphold it. This is, of course, without prejudice to petitioner's right to enforce the obligation in its favor against the PBM receiver in accordance with the rehabilitation program and payment schedule approved or to be approved by the Securities & Exchange Commission.
WHEREFORE, the petition for review should be, as it is hereby, DENIED for lack of merit.
SO ORDERED.

G.R. No. 116668 July 28, 1997
ERLINDA A. AGAPAY, petitioner, vs. CARLINA (CORNELIA) V. PALANG and HERMINIA P. DELA CRUZ, respondents.
ROMERO, J.:
Before us is a petition for review of the decision of the Court of Appeals in CA-G.R. CV No. 24199 entitled "Erlinda Agapay v. Carlina (Cornelia) Palang and Herminia P. Dela Cruz" dated June 22, 1994 involving the ownership of two parcels of land acquired during the cohabitation of petitioner and private respondent's legitimate spouse.
Miguel Palang contracted his first marriage on July 16, 1949 when he took private respondent Carlina (or Cornelia) Vallesterol as a wife at the Pozorrubio Roman Catholic Church in Pangasinan. A few months after the wedding, in October 1949, he left to work in Hawaii. Miguel and Carlina's only child, Herminia Palang, was born on May 12, 1950.
Miguel returned in 1954 for a year. His next visit to the Philippines was in 1964 and during the entire duration of his year-long sojourn he stayed in Zambales with his brother, not in Pangasinan with his wife and child. The trial court found evidence that as early as 1957, Miguel had attempted to divorce Carlina in Hawaii. 1 When he returned for good in 1972, he refused to live with private respondents, but stayed alone in a house in Pozorrubio, Pangasinan.
On July 15, 1973, the then sixty-three-year-old Miguel contracted his second marriage with nineteen-year-old Erlinda Agapay, herein petitioner. 2 Two months earlier, on May 17, 1973, Miguel and Erlinda, as evidenced by the Deed of Sale, jointly purchased a parcel of agricultural land located at San Felipe, Binalonan, Pangasinan with an area of 10,080 square meters. Consequently, Transfer Certificate of Title No. 101736 covering said rice land was issued in their names.
A house and lot in Binalonan, Pangasinan was likewise purchased on September 23, 1975, allegedly by Erlinda as the sole vendee. TCT No. 143120 covering said property was later issued in her name.
On October 30, 1975, Miguel and Cornelia Palang executed a Deed of Donation as a form of compromise agreement to settle and end a case filed by the latter. 3 The parties therein agreed to donate their conjugal property consisting of six parcels of land to their only child, Herminia Palang. 4
Miguel and Erlinda's cohabitation produced a son, Kristopher A. Palang, born on December 6, 1977. In 1979, Miguel and Erlinda were convicted of Concubinage upon Carlina's complaint. 5 Two years later, on February 15, 1981, Miguel died.
On July 11, 1981, Carlina Palang and her daughter Herminia Palang de la Cruz, herein private respondents, instituted the case at bar, an action for recovery of ownership and possession with damages against petitioner before the Regional Trial Court in Urdaneta, Pangasinan (Civil Case No. U-4265). Private respondents sought to get back the riceland and the house and lot both located at Binalonan, Pangasinan allegedly purchased by Miguel during his cohabitation with petitioner.
Petitioner, as defendant below, contended that while the riceland covered by TCT No. 101736 is registered in their names (Miguel and Erlinda), she had already given her half of the property to their son Kristopher Palang. She added that the house and lot covered by TCT No. 143120 is her sole property, having bought the same with her own money. Erlinda added that Carlina is precluded from claiming aforesaid properties since the latter had already donated their conjugal estate to Herminia.
After trial on the merits, the lower court rendered its decision on June 30, 1989 dismissing the complaint after declaring that there was little evidence to prove that the subject properties pertained to the conjugal property of Carlina and Miguel Palang. The lower court went on to provide for the intestate shares of the parties, particularly of Kristopher Palang, Miguel's illegitimate son. The dispositive portion of the decision reads.
WHEREFORE, premises considered, judgment is hereby rendered —
1) Dismissing the complaint, with costs against plaintiffs;
2) Confirming the ownership of defendant Erlinda Agapay of the residential lot located at Poblacion, Binalonan, Pangasinan, as evidenced by TCT No. 143120, Lot 290-B including the old house standing therein;
3) Confirming the ownership of one-half (1/2) portion of that piece of agricultural land situated at Balisa, San Felipe, Binalonan, Pangasinan, consisting of 10,080 square meters and as evidenced by TCT No. 101736, Lot 1123-A to Erlinda Agapay;
4. Adjudicating to Kristopher Palang as his inheritance from his deceased father, Miguel Palang, the one-half (1/2) of the agricultural land situated at Balisa, San Felipe, Binalonan, Pangasinan, under TCT No. 101736 in the name of Miguel Palang, provided that the former (Kristopher) executes, within 15 days after this decision becomes final and executory, a quit-claim forever renouncing any claims to annul/reduce the donation to Herminia Palang de la Cruz of all conjugal properties of her parents, Miguel Palang and Carlina Vallesterol Palang, dated October 30, 1975, otherwise, the estate of deceased Miguel Palang will have to be settled in another separate action;
5) No pronouncement as to damages and attorney's fees.
SO ORDERED. 6
On appeal, respondent court reversed the trial court's decision. The Court of Appeals rendered its decision on July 22, 1994 with the following dispositive portion;
WHEREFORE, PREMISES CONSIDERED, the appealed decision in hereby REVERSED and another one entered:
1. Declaring plaintiffs-appellants the owners of the properties in question;
2. Ordering defendant-appellee to vacate and deliver the properties in question to herein plaintiffs-appellants;
3. Ordering the Register of Deeds of Pangasinan to cancel Transfer Certificate of Title Nos. 143120 and 101736 and to issue in lieu thereof another certificate of title in the name of plaintiffs-appellants.
No pronouncement as to costs. 7
Hence, this petition.
Petitioner claims that the Court of Appeals erred in not sustaining the validity of two deeds of absolute sale covering the riceland and the house and lot, the first in favor of Miguel Palang and Erlinda Agapay and the second, in favor of Erlinda Agapay alone. Second, petitioner contends that respondent appellate court erred in not declaring Kristopher A. Palang as Miguel Palang's illegitimate son and thus entitled to inherit from Miguel's estate. Third, respondent court erred, according to petitioner, "in not finding that there is sufficient pleading and evidence that Kristopher A. Palang or Christopher A. Palang should be considered as party-defendant in Civil Case No. U-4625 before the trial court and in CA-G.R. No. 24199. 8
After studying the merits of the instant case, as well as the pertinent provisions of law and jurisprudence, the Court denies the petition and affirms the questioned decision of the Court of Appeals.
The first and principal issue is the ownership of the two pieces of property subject of this action. Petitioner assails the validity of the deeds of conveyance over the same parcels of land. There is no dispute that the transfer of ownership from the original owners of the riceland and the house and lot, Corazon Ilomin and the spouses Cespedes, respectively, were valid.
The sale of the riceland on May 17, 1973, 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 patently void because the earlier marriage of Miguel and Carlina was still subsisting and unaffected by the latter's 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. 9
In the case at bar, Erlinda tried to establish by her testimony that she is engaged in the business of buy and sell and had a sari-sari store 10 but failed to persuade us that she actually contributed money to buy the subject riceland. Worth noting is the fact that on the date of conveyance, May 17, 1973, petitioner was only around twenty years of age and Miguel Palang was already sixty-four and a pensioner of the U.S. Government. Considering her youthfulness, it is unrealistic to conclude that in 1973 she contributed P3,750.00 as her share in the purchase price of subject property, 11 there being no proof of the same.
Petitioner now claims that the riceland was bought two months before Miguel and Erlinda actually cohabited. In the nature of an afterthought, said added assertion was intended to exclude their case from the operation of Article 148 of the Family Code. Proof of the precise date when they commenced their adulterous cohabitation not having been adduced, we cannot state definitively that the riceland was purchased even before they started living together. In any case, even assuming that the subject property was bought before cohabitation, the rules of co-ownership would still apply and proof of actual contribution would still be essential.
Since petitioner failed to prove that she contributed money to the purchase price of the riceland in Binalonan, Pangasinan, we find 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.
Furthermore, it is immaterial that Miguel and Carlina previously agreed to donate their conjugal property in favor of their daughter Herminia in 1975. The trial court erred in holding that the decision adopting their compromise agreement "in effect partakes the nature of judicial confirmation of the separation of property between spouses and the termination of the conjugal partnership." 12 Separation of property between spouses during the marriage shall not take place except by judicial order or without judicial conferment when there is an express stipulation in the marriage settlements. 13 The judgment which resulted from the parties' compromise was not specifically and expressly for separation of property and should not be so inferred.
With respect to the house and lot, Erlinda allegedly bought the same for P20,000.00 on September 23, 1975 when she was only 22 years old. The testimony of the notary public who prepared the deed of conveyance for the property reveals the falsehood of this claim. Atty. Constantino Sagun testified that Miguel Palang provided the money for the purchase price and directed that Erlinda's name alone be placed as the vendee. 14
The transaction was properly a donation made by Miguel to Erlinda, but one which was clearly 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, 15 for otherwise, the condition of those who incurred guilt would turn out to be better than those in legal union. 16
The second issue concerning Kristopher Palang's status and claim as an illegitimate son and heir to Miguel's estate is here resolved in favor of respondent court's correct assessment that the trial court erred in making pronouncements regarding Kristopher's heirship and filiation "inasmuch as questions as to who are the heirs of the decedent, proof of filiation of illegitimate children and the determination of the estate of the latter and claims thereto should be ventilated in the proper probate court or in a special proceeding instituted for the purpose and cannot be adjudicated in the instant ordinary civil action which is for recovery of ownership and possession." 17
As regards the third issue, petitioner contends that Kristopher Palang should be considered as party-defendant in the case at bar following the trial court's decision which expressly found that Kristopher had not been impleaded as party defendant but theorized that he had submitted to the court's jurisdiction through his mother/guardian ad litem. 18 The trial court erred gravely. Kristopher, not having been impleaded, was, therefore, not a party to the case at bar. His mother, Erlinda cannot be called his guardian ad litem for he was not involved in the case at bar. Petitioner adds that there is no need for Kristopher to file another action to prove that he is illegitimate son of Miguel, in order to avoid multiplicity of suits. 19 Petitioner's grave error has been discussed in the preceding paragraph where the need for probate proceedings to resolve the settlement of Miguel's estate and Kristopher's successional rights has been pointed out.
WHEREFORE, the instant petition is hereby DENIED. The questioned decision of the Court of Appeals is AFFIRMED. Costs against petitioner.
SO ORDERED.

G.R. No. 146683 November 22, 2001
CIRILA ARCABA, petitioner, vs. ERLINDA TABANCURA VDA. DE BATOCAEL, SEIGFREDO C. TABANCURA, DORIS C. TABANCURA, LUZELLI C. TABANCURA, BELEN C. TABANCURA, RAUL A. COMILLE, BERNADETTE A. COMILLE, and ABNER A. COMILLE, respondents.
MENDOZA, J.:
Petitioner Cirila Arcaba seeks review on certiorari of the decision1 of the Court of Appeals, which affirmed with modification the decision2 of the Regional Trial Court, Branch 10, Dipolog City, Zamboanga del Norte in Civil Case No. 4593, declaring as void a deed of donation inter vivos executed by the late Francisco T. Comille in her favor and its subsequent resolution3 denying reconsideration.
The facts are as follows:
On January 16, 1956, Francisco Comille and his wife Zosima Montallana became the registered owners of Lot No. 437-A located at the corner of Calle Santa Rosa (now Balintawak Street) and Calle Rosario (now Rizal Avenue) in Dipolog City, Zamboanga del Norte. The total area of the lot was 418 square meters.4 After the death of Zosima on October 3, 1980, Francisco and his mother-in-law, Juliana Bustalino Montallana, executed a deed of extrajudicial partition with waiver of rights, in which the latter waived her share consisting of one-fourth (1/4) of the property to Francisco.5 On June 27, 1916, Francisco registered the lot in his name with the Registry of Deeds.6
Having no children to take care of him after his retirement, Francisco asked his niece Leticia Bellosillo,7 the latter's cousin, Luzviminda Paghacian,8 and petitioner Cirila Arcaba, then a widow, to take care of his house, as well as the store inside.9
Conflicting testimonies were offered as to the nature of the relationship between Cirila and Francisco. Leticia Bellosillo said Francisco and Cirila were lovers since they slept in the same room,10 while Erlinda Tabancura,11 another niece of Francisco, claimed that the latter had told her that Cirila was his mistress.12 On the other hand, Cirila said she was a mere helper who could enter the master's bedroom only when the old man asked her to and that Francisco in any case was too old for her. She denied they ever had sexual intercourse.13
It appears that when Leticia and Luzviminda were married, only Cirila was left to take care of Francisco.14 Cirila testified that she was a 34-year old widow while Francisco was a 75-year old widower when she began working for the latter; that he could still walk with her assistance at that time;15 and that his health eventually deteriorated and he became bedridden.16 Erlinda Tabancura testified that Francisco's sole source of income consisted of rentals from his lot near the public streets.17 He did not pay Cirila a regular cash wage as a househelper , though he provided her family with food and lodging.18
On January 24, 1991, a few months before his death, Francisco executed an instrument denominated "Deed of Donation Inter Vivos," in which he ceded a portion of Lot 437-A, consisting of 150 square meters, together with his house, to Cirila, who accepted the donation in the same instrument. Francisco left the larger portion of 268 square meters in his name. The deed stated that the donation was being made in consideration of "the faithful services [Cirila Arcaba] had rendered over the past ten (10) years." The deed was notarized by Atty. Vic T. Lacaya, Sr.19 and later registered by Cirila as its absolute owner .20
On October 4, 1991, Francisco died without any children. In 1993, the lot which Cirila received from Francisco had a market value of P57,105.00 and an assessed value of P28,550.00.21
On February 18, 1993, respondents filed a complaint against petitioner 'for declaration of nullity of a deed of donation inter vivos, recovery of possession, and damages. Respondents, who are the decedent's nephews and nieces and his heirs by intestate succession, alleged that Cirila was the common-law wife of Francisco and the donation inter vivos made by Francisco in her favor is void under Article 87 of the Family Code, which provides:
Every donation or grant of gratuitous advantage, direct or indirect, between the spouses during the marriage shall be void, except moderate gifts which the spouses may give each other on the occasion of any family rejoicing. The prohibition shall also apply to persons living together as husband and wife without a valid marriage.
On February 25, 1999, the trial court rendered judgment in favor of respondents, holding the donation void under this provision of the Family Code. The trial court reached this conclusion based on the testimony of Erlinda Tabancura and certain documents bearing the signature of one "Cirila Comille." The documents were (1) an application for a business permit to operate as real estate lessor, dated January 8, 1991, with a carbon copy of the signature "Cirila Comille";22 (2) a sanitary permit to operate as real estate lessor with a health certificate showing the signature "Cirila Comille" in black ink;23 and (3) the death certificate of the decedent with the signature "Cirila A. Comille" written in black ink.24 The dispositive portion of the trial court's decision states:
WHEREFORE, in view of the foregoing, judgment is rendered:
1. Declaring the Deed of Donation Inter Vivos executed by the late Francisco Comille recorded as Doc. No. 7; Page No. 3; Book No. V; Series of 1991 in the Notarial Register of Notary Public Vic T. Lacaya (Annex " A " to the Complaint) null and void;
2. Ordering the defendant to deliver possession of the house and lot subject of the deed unto the plaintiffs within thirty (30) days after finality of this decision; and finally
3. Ordering the defendant to pay attorney's fees in the sum of P10,000.00.
SO ORDERED.25
Petitioner appealed to the Court of Appeals, which rendered on June 19, 2000 the decision subject of this appeal. As already stated, the appeals court denied reconsideration. Its conclusion was based on (1) the testimonies of Leticia, Erlinda, and Cirila; (2) the copies of documents purportedly showing Cirila's use of Francisco's surname; (3) a pleading in another civil case mentioning payment of rentals to Cirila as Francisco's common-law wife; and (4) the fact that Cirila did not receive a regular cash wage.
Petitioner assigns the following errors as having been committed by the Court of Appeals:
(a) The judgment of the Court of Appeals that petitioner was the common-law wife of the late Francisco Comille is not correct and is a reversible error because it is based on a misapprehension of facts, and unduly breaks the chain of circumstances detailed by the totality of the evidence, its findings being predicated on totally incompetent or hearsay evidence, and grounded on mere speculation, conjecture or possibility. (Salazar v. Gutierrez, 33 SCRA 243 and other cases; cited in Quiason, Philippine Courts and their J urisdictions, 1993 ed., p. 604)
(b) The Court of Appeals erred in shifting the burden of evidence from the plaintiff to defendant. (Bunyi v. Reyes, 39 SCRA 504; Quiason, id.)
(c) The Court of Appeals decided the case in away probably not in accord with law or with the applicable jurisprudence in Rodriguez v. Rodriguez, 20 SCRA 908, and Liguez v. CA, 102 Phil. 577, 584.26
The issue in this case is whether the Court of Appeals correctly applied Art. 87 of the Family Code to the circumstances of this case. After a review of the records, we rule in the affirmative.
The general rule is that only questions of law may be raised in a petition for review under Rule 45 of the Rules of Court, subject only to certain exceptions: (a) when the conclusion is a finding grounded entirely on speculations, surmises, or conjectures; (b) when the inference made is manifestly mistaken, absurd, or impossible; (c) where there is grave abuse of discretion; (d) when the judgment is based on a misapprehension of facts; (e) when the findings of fact are conflicting; (f) when the Court of Appeals, in making its findings, went beyond the issues of the case and the same are contrary to the admissions of both appellant and appellee; (g) when the findings of the Court of Appeals are contrary to those of the trial court; (h) when the findings of fact are conclusions without citation of specific evidence on which they are based; (i) when the finding of fact of the Court of Appeals is premised on the supposed absence of evidence but is contradicted by the evidence on record; and G) when the Court of Appeals manifestly overlooked certain relevant facts not disputed by the parties and which, if properly considered, would justify a different conclusion.27 It appearing that the Court of Appeals based its findings on evidence presented by both parties, the general rule should apply.
In Bitangcor v. Tan,28 we held that the term "cohabitation" or "living together as husband and wife" means not only residing under one roof, but also having repeated sexual intercourse. Cohabitation, of course, 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 public assumption by a man and a woman of the marital relation, and dwelling together as man and wife, thereby holding themselves out to the public as such. Secret meetings or nights clandestinely spent together, even if often repeated, do not constitute such kind of cohabitation; they are merely meretricious.29 In this jurisdiction, this Court has considered as sufficient proof of common-law relationship the stipulations between the parties,30 a conviction of concubinage,31 or the existence of legitimate children.32
Was Cirila Francisco's employee or his common-law wife? Cirila admitted that she and Francisco resided under one roof for a long time, It is very possible that the two consummated their relationship, since Cirila gave Francisco therapeutic massage and Leticia said they slept in the same bedroom. At the very least, their public conduct indicated that theirs was not just a relationship of caregiver and patient, but that of exclusive partners akin to husband and wife.
Aside from Erlinda Tabancura's testimony that her uncle told her that Cirila was his mistress, there are other indications that Cirila and Francisco were common-law spouses. Seigfredo Tabancura presented documents apparently signed by Cirila using the surname "Comille." As previously stated, these are an application for a business permit to operate as a real estate lessor,33 a sanitary permit to operate as real estate lessor with a health certificate,34 and the death certificate of Francisco.35 These documents show that Cirila saw herself as Francisco's common-law wife, otherwise, she would not have used his last name. Similarly, in the answer filed by Francisco's lessees in "Erlinda Tabancura, et al. vs. Gracia Adriatico Sy and Antonio Sy," RTC Civil Case No.4719 (for collection of rentals), these lessees referred to Cirila as "the common-law spouse of Francisco." Finally, the fact that Cirila did not demand from Francisco a regular cash wage is an indication that she was not simply a caregiver-employee, but Francisco's common law spouse. She was, after all, entitled to a regular cash wage under the law.36 It is difficult to believe that she stayed with Francisco and served him out of pure beneficence. Human reason would thus lead to the conclusion that she was Francisco's common-law spouse.
Respondents having proven by a preponderance of evidence that Cirila and Francisco lived together as husband and wife without a valid marriage, the inescapable conclusion is that the donation made by Francisco in favor of Cirila is void under Art. 87 of the Family Code.1âwphi1.nêt
WHEREFORE, the decision of the Court of Appeals affirming the decision of the trial court is hereby AFFIRMED.
SO ORDERED.

G.R. No. L-19565 January 30, 1968
ESTRELLA DE LA CRUZ, plaintiff-appellee, vs. SEVERINO DE LA CRUZ, defendant-appellant.
Estacion and Paltriguera for plaintiff-appellee.
Manuel O. Soriano and Pio G. Villoso for defendant-appellant.
CASTRO, J.: The plaintiff Estrella de la Cruz filed a complaint on July 22, 1958 with the Court of First Instance of Negros Occidental, alleging in essence that her husband, the defendant Severino de la Cruz, had not only abandoned her but as well was mismanaging their conjugal partnership properties, and praying for (1) separation of property, (2) monthly support of P2,500 during the pendency of the action, and (3) payment of P20,000 as attorney's fees, and costs. The court a quo forthwith issued an order allowing the plaintiff the amount prayed for as alimony pendente lite, which however, upon defendant's motion, was reduced to P2,000. On June 1, 1961 the trial court rendered judgment ordering separation and division of the conjugal assets, and directing the defendant to pay to the plaintiff the sum of P20,000 as attorney's fees, with legal interest from the date of the original complaint, that is, from July 22, 1958, until fully paid, plus costs. From this judgment the defendant appealed to the Court of Appeals, which certified the case to us, "it appearing that the total value of the conjugal assets is over P500,000". The basic facts are not controverted. The plaintiff and the defendant were married in Bacolod City on February 1, 1938. Six children were born to them, namely, Zenia (1939), Ronnie (1942), Victoria (1944), Jessie 1945), Bella (1946), and Felipe (1948). During their coverture they acquired seven parcels of land of the Bacolod Cadastre, all assessed at P45,429, and three parcels of the Silay Cadastre, all assessed at P43,580. All these parcels are registered in their names. The hacienda in Silay yielded for the year 1957 a net profit of P3,390.49. They are also engaged in varied business ventures with fixed assets valued as of December 31, 1956 at P496,006.92, from which they obtained for that year a net profit of P75,655.78. The net gain of the Philippine Texboard Factory, the principal business of the spouses, was P90,454.48 for the year 1957. As of December 31, 1959, the total assets of the various enterprises of the conjugal partnership were valued at P1,021,407.68, not including those of the Top Service Inc., of which firm the defendant has been the president since its organization in 1959 in Manila with a paid-up capital of P50,000, P10,000 of which was contributed by him. This corporation was the Beverly Hills Subdivision in Antipolo, Rizal, the Golden Acres Subdivision and the Green Valley Subdivision in Las Piñas, Rizal, and a lot and building located at M. H. del Pilar, Manila purchased for P285,000, an amount borrowed from the Manufacturer's Bank and Trust Company. The spouses are indebted to the Philippine National Bank and the Development Bank of the Philippines for loans obtained, to secure which they mortgaged the Philippine Texboard Factory, the Silay hacienda, their conjugal house, and all their parcels of land located in Bacolod City. The essential issues of fact may be gleaned from the nine errors the defendant imputes to the court a quo, namely,
1. In finding that the only visit, from May 15, 1955 to the rendition of the decision, made by the defendant to the conjugal abode to see his wife was on June 15, 1955;
2. In finding that the letter exh. 3 was written by one Nenita Hernandez and that she and the defendant are living as husband and wife;
3. In finding that since 1951 the relations between the plaintiff and the defendant were far from cordial, and that it was from 1948 that the former has been receiving an allowance from the latter;
4. In finding that the defendant has abandoned the plaintiff;
5. In finding that the defendant since 1956 has not discussed with his wife the business activities of the partnership, and that this silence constituted "abuse of administration of the conjugal partnerships";
6. In declaring that the defendant mortgaged the conjugal assets without the knowledge of the plaintiff and thru false pretences to which the latter was prey;
7. In allowing the plaintiff, on the one hand, to testify on facts not actually known by her, and, on the other hand, in not allowing the defendant to establish his special defenses;
8. In ordering separation of the conjugal partnership properties; and
9. In sentencing the defendant to pay to the plaintiff attorney's fees in the amount of P20,000, with interest at the legal rate.1äwphï1.ñët Two issues of law as well emerge, requiring resolution petition: (1) Did the separation of the defendant from the plaintiff constitute abandonment in law that would justify a separation of the conjugal partnership properties? (2) Was the defendant's failure and/or refusal to inform the plaintiff of the state of their business enterprises such an abuse of his powers of administration of the conjugal partnership as to warrant a division of the matrimonial assets? The plaintiff's evidence may be summarized briefly. The defendant started living in Manila in 1955, although he occasionally returned to Bacolod City, sleeping in his office at the Philippine Texboard Factory in Mandalagan, instead of in the conjugal home at 2nd Street, Bacolod City. Since 1955 the defendant had not slept in the conjugal dwelling, although in the said year he paid short visits during which they engaged in brief conversations. After 1955 up to the time of the trial, the defendant had never visited the conjugal abode, and when he was in Bacolod, she was denied communication with him. He has abandoned her and their children, to live in Manila with his concubine, Nenita Hernandez. In 1949 she began to suspect the existence of illicit relations between her husband and Nenita. This suspicion was confirmed in 1951 when she found an unsigned note in a pocket of one of her husband's polo shirt which was written by Nenita and in which she asked "Bering" to meet her near the church. She confronted her husband who forthwith tore the note even as he admitted his amorous liaison with Nenita. He then allayed her fears by vowing to forsake his mistress. Subsequently, in November 1951, she found in the iron safe of her husband a letter, exh. C, also written by Nenita. In this letter the sender (who signed as "D") apologized for her conduct, and expressed the hope that the addressee ("Darling") could join her in Baguio as she was alone in the Patria Inn and lonely in "a place for honeymooners". Immediately after her husband departed for Manila the following morning, the plaintiff enplaned for Baguio, where she learned that Nenita had actually stayed at the Patria Inn, but had already left for Manila before her arrival. Later she met her husband in the house of a relative in Manila from whence they proceeded to the Avenue Hotel where she again confronted him about Nenita. He denied having further relations with this woman. Celia Bañez, testifying for the plaintiff, declared that she was employed as a cook in the home of the spouses from May 15, 1955 to August 15, 1958, and that during the entire period of her employment she saw the defendant in the place only once. This declaration is contradicted, however, by the plaintiff herself who testified that in 1955 the defendant "used to have a short visit there," which statement implies more than one visit. The defendant, for his part, denied having abandoned his wife and children, but admitted that in 1957, or a year before the filing of the action, he started to live separately from his wife. When he transferred his living quarters to his office in Mandalagan, Bacolod City, his intention was not, as it never has been, to abandon his wife and children, but only to teach her a lesson as she was quarrelsome and extremely jealous of every woman. He decided to live apart from his wife temporarily because at home he could not concentrate on his work as she always quarreled with him, while in Mandalagan he could pass the nights in peace. Since 1953 he stayed in Manila for some duration of time to manage their expanding business and look for market outlets for their texboard products. Even the plaintiff admitted in both her original and amended complaints that "sometime in 1953, because of the expanding business of the herein parties, the defendant established an office in the City of Manila, wherein some of the goods, effects and merchandise manufactured or produced in the business enterprises of the parties were sold or disposed of". From the time he started living separately in Mandalagan up to the filing of the complaint, the plaintiff herself furnished him food and took care of his laundry. This latter declaration was not rebutted by the plaintiff. The defendant, with vehemence, denied that he has abandoned his wife and family, averring that he has never failed, even for a single month, to give them financial support, as witnessed by the plaintiff's admission in her original and amended complaints as well as in open court that during the entire period of their estrangement, he was giving her around P500 a month for support. In point of fact, his wife and children continued to draw allowances from his office of a total ranging from P1,200 to P1,500 a month. He financed the education of their children, two of whom were studying in Manila at the time of the trial and were not living with the plaintiff. While in Bacolod City, he never failed to visit his family, particularly the children. His wife was always in bad need of money because she played mahjong, an accusation which she did not traverse, explaining that she played mahjong to entertain herself and forget the infidelities of her husband. Marcos V. Ganaban, the manager of the Philippine Texboard Factory, corroborated the testimony of the defendant on the matter of the support the latter gave to his family, by declaring in court that since the start of his employment in 1950 as assistant general manager, the plaintiff has been drawing an allowance of P1,000 to P1,500 monthly, which amount was given personally by the defendant or, in his absence, by the witness himself. The defendant denied that he ever maintained a mistress in Manila. He came to know Nenita Hernandez when she was barely 12 years old, but had lost track of her thereafter. His constant presence in Manila was required by the pressing demands of an expanding business. He denied having destroyed the alleged note which the plaintiff claimed to have come from Nenita, nor having seen, previous to the trial, the letter exh. C. The allegation of his wife that he had a concubine is based on mere suspicion. He had always been faithful to his wife, and not for a single instance had he been caught or surprised by her with another woman. On the matter of the alleged abuse by the defendant of his powers of administration of the conjugal partnership, the plaintiff declared that the defendant refused and failed to inform her of the progress of their various business concerns. Although she did not allege, much less prove, that her husband had dissipated the conjugal properties, she averred nevertheless that her husband might squander and dispose of the conjugal assets in favor of his concubine. Hence, the urgency of separation of property. The defendant's answer to the charge of mismanagement is that he has applied his industry, channeled his ingenuity, and devoted his time, to the management, maintenance and expansion of their business concerns, even as his wife threw money away at the mahjong tables. Tangible proof of his endeavors is that from a single cargo truck which he himself drove at the time of their marriage, he had built up one business after another, the Speedway Trucking Service, the Negros Shipping Service, the Bacolod Press, the Philippine Texboard Factory, and miscellaneous other business enterprises worth over a million pesos; that all that the spouses now own have been acquired through his diligence, intelligence and industry; that he has steadily expanded the income and assets of said business enterprises from year to year, contrary to the allegations of the complainant, as proved by his balance sheet and profit and loss statements for the year 1958 and 1959 (exhibits 1 and 2); and that out of the income of their enterprises he had purchased additional equipment and machineries and has partially paid their indebtedness to the Philippine National Bank and the Development Bank of the Philippines. It will be noted that the plaintiff does not ask for legal separation. The evidence presented by her to prove concubinage on the part of the defendant, while pertinent and material in the determination of the merits of a petition for legal separation, must in this case be regarded merely as an attempt to bolster her claim that the defendant had abandoned her, which abandonment, if it constitutes abandonment in law, would justify separation of the conjugal assets under the applicable provisions of article 178 of the new Civil Code which read: "The separation in fact between husband and wife without judicial approval, shall not affect the conjugal partnership, except that . . . if the husband has abandoned the wife without just cause for at least one year, she may petition the court for a receivership, or administration by her of the conjugal partnership property, or separation of property". In addition to abandonment as a ground, the plaintiff also invokes article 167 of the new Civil Code in support of her prayer for division of the matrimonial assets. This article provides that "In case of abuse of powers of administration of the conjugal partnership property by the husband, the courts, on the petition of the wife, may provide for a receivership, or administration by the wife, or separation of property". It behooves us, therefore, to inquire, in the case at bar, whether there has been abandonment, in the legal sense, by the defendant of the plaintiff, and/or whether the defendant has abused his powers of administration of the conjugal partnership property, so as to justify the plaintiff's plea for separation of property. We have made a searching scrutiny of the record, and it is our considered view that the defendant is not guilty of abandonment of his wife, nor of such abuse of his powers of administration of the conjugal partnership, as to warrant division of the conjugal assets. The extraordinary remedies afforded to the wife by article 178 when she has been abandoned by the husband for at least one year are the same as those granted to her by article 167 in case of abuse of the powers of administration by the husband. To entitle her to any of these remedies, under article 178, there must be real abandonment, and not mere separation. 1 The abandonment must not only be physical estrangement but also amount to financial and moral desertion. Although an all-embracing definition of the term "abandonment " is yet to be spelled out in explicit words, we nevertheless can determine its meaning from the context of the Law as well as from its ordinary usage. The concept of abandonment in article 178 may be established in relation to the alternative remedies granted to the wife when she has been abandoned by the husband, namely, receivership, administration by her, or separation of property, all of which are designed to protect the conjugal assets from waste and dissipation rendered imminent by the husband's continued absence from the conjugal abode, and to assure the wife of a ready and steady source of support. Therefore, physical separation alone is not the full meaning of the term "abandonment", if the husband, despite his voluntary departure from the society of his spouse, neither neglects the management of the conjugal partnership nor ceases to give support to his wife. The word "abandon", in its ordinary sense, means to forsake entirely; to forsake or renounce utterly. 2 The dictionaries trace this word to the root idea of "putting under a bar". The emphasis is on the finality and the publicity with which some thing or body is thus put in the control of another, and hence the meaning of giving up absolutely, with intent never again to resume or claim one's rights or interests. 3 When referring to desertion of a wife by a husband, the word has been defined as "the act of a husband in voluntarily leaving his wife with intention to forsake her entirely, never to return to her, and never to resume his marital duties towards her, or to claim his marital rights; such neglect as either leaves the wife destitute of the common necessaries of life, or would leave her destitute but for the charity of others." 4 The word "abandonment", when referring to the act of one consort of leaving the other, is "the act of the husband or the wife who leaves his or her consort wilfully, and with an intention of causing per perpetual separation." 5 Giving to the word "abandoned", as used in article 178, the meaning drawn from the definitions above reproduced, it seems rather clear that to constitute abandonment of the wife by the husband, there must be absolute cessation of marital relations and duties and rights, with the intention of perpetual separation. Coming back to the case at bar, we believe that the defendant did not intend to leave his wife and children permanently. The record conclusively shows that he continued to give support to his family despite his absence from the conjugal home. This fact is admitted by the complainant, although she minimized the amount of support given, saying that it was only P500 monthly. There is good reason to believe, however, that she and the children received more than this amount, as the defendant's claim that his wife and children continued to draw from his office more than P500 monthly was substantially corroborated by Marcos Ganaban, whose declarations were not rebutted by the plaintiff. And then there is at all no showing that the plaintiff and the children were living in want. On the contrary, the plaintiff admitted, albeit reluctantly, that she frequently played mahjong, from which we can infer that she had money; to spare. The fact that the defendant never ceased to give support to his wife and children negatives any intent on his part not to return to the conjugal abode and resume his marital duties and rights. In People v. Schelske, 6 it was held that where a husband, after leaving his wife, continued to make small contributions at intervals to her support and that of their minor child, he was not guilty of their "abandonment", which is an act of separation with intent that it shall be perpetual, since contributing to their support negatived such intent. In re Hoss' Estate, supra, it was ruled that a father did not abandon his family where the evidence disclosed that he almost always did give his wife part of his earnings during the period of their separation and that he gradually paid some old rental and grocery bills. With respect to the allegation that the defendant maintained a concubine, we believe, contrary to the findings of the court a quo, that the evidence on record fails to preponderate in favor of the plaintiff's thesis. The proof that Nenita Hernandez was the concubine of the defendant and that they were living as husband and wife in Manila, is altogether too indefinite. Aside from the uncorroborated statement of the plaintiff that she knew that Nenita Hernandez was her husband's concubine, without demonstrating by credible evidence the existence of illicit relations between Nenita and the defendant, the only evidence on record offered to link the defendant to his alleged mistress is exh. C. The plaintiff however failed to connect authorship of the said letter with Nenita, on the face whereof the sender merely signed as "D" and the addressee was one unidentified "Darling". The plaintiff's testimony on cross-examination, hereunder quoted, underscores such failure:
Q. You personally never received any letter from Nenita?
A. No.
Q. Neither have you received on any time until today from 1949 from Nenita?
A. No.
Q. Neither have you written to her any letter yourself until now?
A. Why should I write a letter to her.
Q. In that case, Mrs. De la Cruz, you are not familiar with the handwriting of Nenita. Is that right?
A. I can say that Nenita writes very well.
Q. I am not asking you whether she writes very well or not but, my question is this: In view of the fact that you have never received a letter from Nenita, you have ot sent any letter to her, you are not familiar with her handwriting?
A. Yes.
Q. You have not seen her writing anybody?
A. Yes. Anent the allegation that the defendant had mismanaged the conjugal partnership property, the record presents a different picture. There is absolutely no evidence to show that he has squandered the conjugal assets. Upon the contrary, he proved that through his industry and zeal, the conjugal assets at the time of the trial had increased to a value of over a million pesos. The lower court likewise erred in holding that mere refusal or failure of the husband as administrator of the conjugal partnership to inform the wife of the progress of the family businesses constitutes abuse of administration. For "abuse" to exist, it is not enough that the husband perform an act or acts prejudicial to the wife. Nor is it sufficient that he commits acts injurious to the partnership, for these may be the result of mere inefficient or negligent administration. Abuse connotes willful and utter disregard of the interests of the partnership, evidenced by a repetition of deliberate acts and/or omissions prejudicial to the latter. 7 If there is only physical separation between the spouses (and nothing more), engendered by the husband's leaving the conjugal abode, but the husband continues to manage the conjugal properties with the same zeal, industry, and efficiency as he did prior to the separation, and religiously gives support to his wife and children, as in the case at bar, we are not disposed to grant the wife's petition for separation of property. This decision may appear to condone the husband's separation from his wife; however, the remedies granted to the wife by articles 167 and 178 are not to be construed as condonation of the husband's act but are designed to protect the conjugal partnership from waste and shield the wife from want. Therefore, a denial of the wife's prayer does not imply a condonation of the husband's act but merely points up the insufficiency or absence of a cause of action.1äwphï1.ñët Courts must need exercise judicial restraint and reasoned hesitance in ordering a separation of conjugal properties because the basic policy of the law is homiletic, to promote healthy family life and to preserve the union of the spouses, in person, in spirit and in property. Consistent with its policy of discouraging a regime of separation as not in harmony with the unity of the family and the mutual affection and help expected of the spouses, the Civil Code (both old and new) requires that separation of property shall not prevail unless expressly stipulated in marriage settlements before the union is solemnized or by formal judicial decree during the existence of the marriage (Article 190, new Civil Code, Article 1432, old Civil Code): and in the latter case, it may only be ordered by the court for causes specified in Article 191 of the new Civil Code. 8 Furthermore, a judgment ordering the division of conjugal assets where there has been no real abandonment, the separation not being wanton and absolute, may altogether slam shut the door for possible reconciliation. The estranged spouses may drift irreversibly further apart; the already broken family solidarity may be irretrievably shattered; and any flickering hope for a new life together may be completely and finally extinguished. The monthly alimony in the sum of P2,000 which was allowed to the wife in 1958, long before the devaluation of the Philippine peso in 1962, should be increased to P3,000. On the matter of attorney's fees, it is our view that because the defendant, by leaving the conjugal abode, has given cause for the plaintiff to seek redress in the courts, and ask for adequate support, an award of attorney's fees to the plaintiff must be made. Ample authority for such award is found in paragraphs 6 and 11 of article 2208 of the new Civil Code which empower courts to grant counsel's fees "in actions for legal support" and in cases "where the court deems it just and equitable that attorney's fees . . . should be recovered." However, an award of P10,000, in our opinion, is, under the environmental circumstances, sufficient. This Court would be remiss if it did not, firstly, remind the plaintiff and the defendant that the law enjoins husband and wife to live together, and, secondly, exhort them to avail of — mutually, earnestly and steadfastly — all opportunities for reconciliation to the end that their marital differences may be happily resolved, and conjugal harmony may return and, on the basis of mutual respect and understanding, endure. ACCORDINGLY, the judgment a quo, insofar as it decrees separation of the conjugal properties, is reversed and set aside. Conformably to our observations, however, the defendant is ordered to pay to the plaintiff, in the concept of support, the amount of P3,000 per month, until he shall have rejoined her in the conjugal home, which amount may, in the meantime, be reduced or increased in the discretion of the court a quo as circumstances warrant. The award of attorney's fees to the plaintiff is reduced to P10,000, without interest. No pronouncement as to costs.
G.R. No. 82606 December 18, 1992
PRIMA PARTOSA-JO, petitioner, vs. THE HONORABLE COURT OF APPEALS and HO HANG (with aliases JOSE JO and CONSING), respondents.
CRUZ, J.:
The herein private respondent, Jose Jo, admits to having cohabited with three women and fathered fifteen children. The first of these women, the herein petitioner, claims to be his legal wife whom he begot a daughter, Monina Jo. The other women and their respective offspring are not parties of these case.
In 1980, the petitioner filed a complaint against Jo for judicial separation of conjugal property, docketed as Civil Case No. 51, in addition to an earlier action for support, also against him and docketed as Civil Case No. 36, in the Regional Trial Court of Negros Oriental, Branch 35.
The two cases were consolidated and tried jointly. On November 29, 1983, Judge German G. Lee, Jr. rendered an extensive decision, the dispositive portion of which read:
WHEREFORE, in view of all the foregoing arguments and considerations, this court hereby holds that the plaintiff Prima Partosa was legally married to Jose Jo alias Ho Hang, alias Consing, and, therefore, is entitled to support as the lawfully wedded wife and the defendant is hereby ordered to give a monthly support of P500.00 to the plaintiff Prima Partosa, to be paid on or before the 5th day of every month, and to give to the plaintiff the amount of P40,000.00 for the construction of the house in Zamboanguita, Negros Oriental where she may live separately from the defendant being entitled under the law to separate maintenance being the innocent spouse and to pay the amount of P19,200.00 to the plaintiff by way of support in arrears and to pay the plaintiff the amount of P3,000.00 in the concept of attorney's fees.
As will be noticed, there was a definite disposition of the complaint for support but none of the complaint for judicial separation of conjugal property.
Jo elevated the decision to the Court of Appeals, which affirmed the ruling of the trial court in the complaint for support. 1 The complaint for judicial separation of conjugal property was dismissed for lack of a cause of action and on the ground that separation by agreement was not covered by Article 178 of the Civil Code.
When their motions for reconsideration were denied, both parties came to this Court for relief. The private respondent's petition for review on certiorari was dismissed for tardiness in our resolution dated February 17, 1988, where we also affirmed the legality of the marriage between Jose and Prima and the obligation of the former to support her and her daughter.
This petition deals only with the complaint for judicial separation of conjugal property.
It is here submitted that the Court of Appeals erred in holding that: a) the judicial separation of conjugal property sought was not allowed under Articles 175, 178 and 191 of the Civil Code; and b) no such separation was decreed by the trial court in the dispositive portion of its decision.
The private respondent contends that the decision of the trial court can longer be reviewed at this time because it has a long since become final and executory. As the decretal portion clearly made no disposition of Civil Case No. 51, that case should be considered impliedly dismissed. The petitioner should have called the attention of the trial court to the omission so that the proper rectification could be made on time. Not having done so, she is now concluded by the said decision, which can no longer be corrected at this late hour.
We deal first with the second ground.
While admitting that no mention was made of Civil Case No. 51 in the dispositive portion of the decision of the trial court, the petitioner argues that a disposition of the case was nonetheless made in the penultimate paragraph of the decision reading as follows:
It is, therefore, hereby ordered that all properties in question are considered properties of Jose Jo, the defendant in this case, subject to separation of property under Article 178, third paragraph of the Civil Code, which is subject of separate proceedings as enunciated herein.
The petitioner says she believed this to be disposition enough and so did not feel it was necessary for her to appeal, particularly since the order embodied in that paragraph was in her favor. It was only when the respondent court observed that there was no dispositive portion regarding that case and so ordered its dismissal that she found it necessary to come to this Court for relief.
The petitioner has a point.
The dispositive portion of the decision in question was incomplete insofar as it carried no ruling on the complaint for judicial separation of conjugal property although it was extensively discussed in the body of the decision. The drafting of the decision was indeed not exactly careful. The petitioner's counsel, noting this, should have taken immediate steps for the rectification for the omission so that the ruling expressed in the text of the decision could have been embodied in the decretal portion. Such alertness could have avoided this litigation on a purely technical issue.
Nevertheless, the technicality invoked in this case should not be allowed to prevail over considerations of substantive justive. After all, the technical defect is not insuperable. We have said time and again that where there is an ambiguity caused by an omission or a mistake in the dispositive portion of the decision, this Court may clarify such an ambiguity by an amendment even after the judgment have become final. 2 In doing so, the Court may resort to the pleading filed by the parties and the findings of fact and the conclusions of law expressed in the text or body of the decision. 3
The trial court made definite findings on the complaint for judicial separation of conjugal property, holding that the petitioner and the private respondent were legally married and that the properties mentioned by the petitioner were acquired by Jo during their marriage although they were registered in the name of the apparent dummy.
There is no question therefore that the penultimate paragraph of the decision of the trial court was a ruling based upon such findings and so should have been embodied in the dispositive portion. The respondent court should have made the necessary modification instead of dismissing Civil Case No. 51 and thus upholding mere form over substance.
In the interest of substantive justice, and to expedite these proceedings, we hereby make such modification.
And now to the merits of Civil Case No. 51.
The Court of Appeals dismissed the complaint on the ground that the separation of the parties was due to their agreement and not because of abondonment. The respondent court relied mainly on the testimony of the petitioner, who declared under oath that she left Dumaguete City, where she and Jo were living together "because that was our agreement." It held that a agreement to live separately without just cause was void under Article 221 of the Civil Code and could not sustain any claim of abandonment by the aggrieved spouse. Its conclusion was that the only remedy availabe to the petitioner was legal separation under Article 175 of the Civil Code, 4 by virtue of which the conjugal partnership of property would be terminated.
The petitioner contends that the respondent court has misinterpreted Articles 175, 178 and 191 of the Civil Code. She submits that the agreement between her and the private respondent was for her to temporarily live with her parents during the initial period of her pregnancy and for him to visit and support her. They never agreed to separate permanently. And even if they did, this arrangement was repudiated and ended in 1942, when she returned to him at Dumaguete City and he refused to accept her.
The petitioner invokes Article 178 (3) of the Civil Code, which reads:
Art. 178. The separation in fact between husband and wife without judicial approval, shall not affect the conjugal partnership, except that: xxx xxx xxx
(3) If the husband has abandoned the wife without just cause for at least one year, she may petition the court for a receivership, or administration by her of the conjugal partnership property or separation of property.
The above-quoted provision has been superseded by Article 128 of the Family Code, which states:
Art. 128. If a spouse without just cause abandons the other or fails to comply with his or her obligations to the family, the aggrieved spouse may petition the court for receivership, for judicial separation of property, of for authority to be the sole administrator of the conjugal partnership property, subject to such precautionary conditions as the court may impose.
The obligations to the family mentioned in the preceding paragraph refer to martial, parental or property relations.
A spouse is deemed to have abondoned the other when he or she has left the conjugal dwelling without any intention of returning. The spouse who has left the conjugal dwelling for a period of three months or has failed within the same period to give any information as to his or her whereabouts shall be prima facie presumed to have no intention of returning to the conjugal dwelling.
Under the this provision, the aggrieved spouse may petition for judicial separation on either of these grounds:
1. Abondonment by a spouse of the other without just cause; and
2. Failure of one spouse to comply with his or her obligations to the family without just cause, even if she said spouse does not leave the other spouse.
Abandonment implies a departure by one spouse with the avowed intent never to return, followed by prolonged absence without just cause, and without in the meantime providing in the least for one's family although able to do so. 5 There must be absolute cessation of marital relations, duties and rights, with the intention of perpetual separation. 6 This idea is clearly expressed in the above-quoted provision, which states that "a spouse is deemed to have abandoned the other when he or she has left the conjugal dwelling without any intention of returning."
The record shows that as early as 1942, the private respondent had already rejected the petitioner, whom he denied admission to their conjugal home in Dumaguete City when she returned from Zamboanguita. The fact that she was not accepted by Jo demonstrates all too clearly that he had no intention of resuming their conjugal relationship. Moreover, beginning 1968 until the determination by this Court of the action for support in 1988, the private respondent refused to give financial support to the petitioner. The physical separation of the parties, coupled with the refusal by the private respondent to give support to the petitioner, sufficed to constitute abandonment as a ground for the judicial separation of their conjugal property.
In addition, the petitioner may also invoke the second ground allowed by Article 128, for the fact is that he has failed without just cause to comply with his obligations to the family as husband or parent. Apart form refusing to admit his lawful wife to their conjugal home in Dumaguete City, Jo has freely admitted to cohabiting with other women and siring many children by them. It was his refusal to provide for the petitioner and their daughter that prompted her to file the actions against him for support and later for separation of the conjugal property, in which actions, significantly, he even denied being married to her. The private respondent has not established any just cause for his refusal to comply with his obligations to his wife as dutiful husband.
Their separation thus falls also squarely under Article 135 of the Family Code, providing as follows:
Art. 135. Any of the following shall be considered sufficient cause for judicial separation of property: xxx xxx xxx
(6) That at the time of the petition, the spouse have been separated in fact for at least one year and reconciliation is highly improbable.
The amendments introduced in the Family Code are applicable to the case before us although they became effective only on August 3, 1988. As we held in Ramirez v. Court of Appeals: 7
The greater weight of authority is inclined to the view that an appellate court, in reviewing a judgment on appeal, will dispose of a question according to the law prevailing at the term of such disposition, and not according to the law prevailing at the time of rendition of the appealed judgement. The court will therefore reverse a judgement which was correct at the time it was originally rendered where, by statute, there has been an intermediate change in the law which renders such judgement erroneous at the time the case was finally disposed of on appeal.
The order of judicial separation of the properties in question is based on the finding of both the trial and respondent courts that the private respondent is indeed their real owner. It is these properties that should now be divided between him and the petitioner, on the assumption that they were acquired during coverture and so belong to the spouses half and half. As the private respondent is a Chinese citizen, the division must include such properties properly belonging to the conjugal partnership as may have been registered in the name of other persons in violation of the Anti-Dummy Law.
The past has caught up with the private respondent. After his extramarital flings and a succession of illegitimate children, he must now make an accounting to his lawful wife of the properties he denied her despite his promise to their of his eternal love and care.
WHEREFORE, the petition is GRANTED and the assailed decision of the respondent court is MODIFIED. Civil Case No. 51 is hereby decided in favor the plaintiff, the petitioner herein, and the conjugal property of the petitioner and the private respondent is hereby ordered divided between them, share and share alike. This division shall be implemented by the trial court after determination of all the properties pertaining to the said conjugal partnership, including those that may have been illegally registered in the name of the persons.
SO ORDERED.