SPOUSES AGGABAO V. PARULAN, JR.

AND PARULAN

G.R. No. 165803, [September 1, 2010]

DOCTRINE(S):

1. The sale was made on March 18, 1991, or after Au-gust 3, 1988, the effectivity of the
Family Code. The proper law to apply is, therefore, Article 124 of the Family Code, for it
is settled that any alienation or encumbrance of conjugal property made during the
effectivity of the Family Code is governed by Article 124 of the Family Code.
2. According to Article 256 of the Family Code, the pro-visions of the
Family Code may apply retroactively provided no vested rights are impaired. In Tumlos
v. Fernandez, 330 SCRA 718 (2000), the Court rejected the petitioner’s argument that the
Family Code did not apply because the acquisition of the contested property had
occurred prior to the effectivity of the Family Code, and pointed out that Article 256 pro-
vided that the Family Code could apply retroactively if the application would not
prejudice vested or ac-quired rights existing before the effectivity of the Family Code.
Herein, however, the petitioners did not show any vested right in the property acquired
prior to August 3, 1988 that exempted their situation from the retroactive application of
the Family Code.

FACTS:

In January 1991, real estate broker Marta K.Atanacio offered 2 lots located in Parañaque
to the petitioners. On February 2, 1991, the petitioners met up with Elena Parulan at the
site of the property and showed them the following documents: (a.) Owner’s original copy
of the TCT of the 2 lots; (b.) tax declarations; (c.) a copy of the special power of attorney
dated January 7, 1991 executed by Dionisio authorizing Elena to sell the property. The
petitioners paid P200,000.00 as earnest money for which Elena executed a handwritten
Receipt of Earnest Money which stipulated that the peitioners would pay an additional
payment of P130, 000.00 on February 4, 1991; P650,000.00 on or before February 15,
1991 and P700, 000.00 on March 31, 1991 once Elena turned over the property.

On February 4, 1991, the petitioners, accompanied by the broker, went to the Office of the
Register of Deeds to verify the TCTs shown by Elena. There they discovered that one of
the lots had been encumbered to Banco Filipino, but that the encumbrance had been
cancelled due to the full payment of the obligation. They noticed that the loan was effected
through and SPA executed by Dionisio in favor of Elena. The other lot on the other hand
had an annotation of an existing mortgage in favor of Los Baños Rural Bank, with the
same SPA with a court order authorizing Elena to mortgage the lot to secure the loan.

The petitioners and the broker next inquired about the mortgage and the court order at
the Los Baños Rural Bank. There, they met with Atty. Zarate, related that the bank had
asked for the court order because the lot involved was conjugal property.
Following their verification, the petitioners delivered P130,000.00 as additional down
payment on February 4, 1991; and P650,000.00 to the Los Baños Rural Bank on February
12, 1991, which then released the owner’s duplicate copy of TCT to them.

On March 18, 1991, the petitioners delivered the final amount of P700,000.00 to Elena,
who executed a deed of absolute sale in their favor. However, Elena did not turn over the
owner’s duplicate copy of the TCT claiming that said copy was in the possession of a
relative who was then in Hongkong. She assured them that the owner’s duplicate copy of
TCT would be turned over after a week.

On March 19, 1991, TCT was cancelled and a new one was issued in the name of the
petitioners. Elena did not turn over the duplicate owner’s copy of TCT as promised. In
due time, the petitioners learned that the duplicate owner’s copy of TCT had been all along
in the custody of Atty. Jeremy Z. Parulan, who appeared to hold an SPA executed by his
brother Dionisio authorizing him to sell both lots. At Atanacio’s instance, the petitioners
met on March 25, 1991 with Atty. Parulan at the Manila Peninsula. They were
accompanied by one Atty. Olandesca. They recalled that Atty. Parulan “smugly demanded
P800,000.00” in exchange for the duplicate owner’s copy of TCT, because Atty. Parulan
represented the current value of the property to be P1.5 million. As a counter-offer,
however, they tendered P250,000.00, which Atty. Parulan declined, giving them only
until April 5, 1991 to decide. Hearing nothing more from the petitioners, Atty. Parulan
decided to call them on April 5, 1991, but they informed him that they had already fully
paid to Elena.

Thus, on April 15, 1991, Dionisio, through Atty. Parulan, commenced an action (Civil Case
No. 91-1005 entitled Dionisio Z. Parulan, Jr., represented by Jeremy Z. Parulan, as
attorney in fact, v. Ma. Elena Parulan, Sps. Rex and Coney Aggabao), praying for the
declaration of the nullity of the deed of absolute sale executed by Ma. Elena, and the
cancellation of the title issued to the petitioners by virtue thereof. In turn, the petitioners
filed on July 12, 1991 their own action for specific performance with damages against the
respondents. Both cases were consolidated for trial and judgment in the RTC.

On July 26, 2000, the Regional Trial Court (RTC), Branch 136, in Makati City annulled
the deed of absolute sale executed in favor of the petitioners covering two parcels of
registered land the respondents owned for want of the written consent of respondent
husband Dionisio Parulan, Jr. The CA affirmed the RTC decision.

ISSUE:

Which between Article 173 of the Civil Code and Article 124 of the
Family Code should apply to the sale of the conjugal property executed without
the consent of Dionisio?

HELD:

Article 124, Family Code, applies to sale of conjugal properties made after the effectivity
of the Family Code
RATIO:

The petitioners submit that Article 173 of the CivilCode, not Article 124 of the
Family Code, governed the property relations of the respondents because they had been
married prior to the effectivity of the Family Code; and that the second paragraph
of Article 124 of the Family Code should not apply because the other spouse held the
administration over the conjugal property. They argue that notwithstanding his absence
from the country Dionisio still held the administration of the conjugal property by virtue
of his execution of the SPA in favor of his brother; and that even assuming that Article 124
of the Family Code properly applied, Dionisio ratified the sale through Atty. Parulan’s
counter-offer during the March 25, 1991 meeting.

To start with, Article 25427 the Family Code has expressly repealed several titles under
the Civil Code, among them the entire Title VI in which the provisions on the property
relations between husband and wife, Article 173 included, are found.

Secondly, the sale was made on March 18, 1991, or after August 3, 1988, the effectivity of
the Family Code. The proper law to apply is, therefore, Article 124 of the Family Code, for
it is settled that any alienation or encumbrance of conjugal property made during the
effectivity of the Family Code is governed by Article 124 of the Family Code.

Article 124 of the Family Code provides:

“Article 124. The administration and enjoyment of the conjugal partnership property
shall belong to both spouses jointly. In case of disagreement, the husband’s decision shall
prevail, subject to recourse to the court by the wife for proper remedy, which must be
availed of within five years from the date of the contract implementing such decision.

In the event that one spouse is incapacitated or otherwise unable to participate in the
administration of the conjugal properties, the other spouse may assume sole powers of
administration. These powers do not include disposition or encumbrance without
authority of the court or the written consent of the other spouse. In the absence of such
authority or consent, the disposition or encumbrance shall be void. However, the
transaction shall be construed as a continuing offer on the part of the consenting spouse
and the third person, and may be perfected as a binding contract upon the acceptance by
the other spouse or authorization by the court before the offer is withdrawn by either or
both offerors.”

Thirdly, according to Article 256 of the Family Code, the provisions of the Family Code
may apply retroactively provided no vested rights are impaired. In Tumlos v. Fernandez,
the Court rejected the petitioner’s argument that the Family Code did not apply because
the acquisition of the contested property had occurred prior to the effectivity of the Family
Code, and pointed out that Article 256 provided that the Family Code could apply
retroactively if the application would not prejudice vested or acquired rights existing
before the effectivity of the Family Code. Herein, however, the petitioners did not show
any vested right in the property acquired prior to August 3, 1988 that exempted their
situation from the retroactive application of the Family Code.
Fourthly, the petitioners failed to substantiate their contention that Dionisio, while
holding the administration over the property, had delegated to his brother, Atty. Parulan,
the administration of the property, considering that they did not present in court the SPA
granting to Atty. Parulan the authority for the administration.

Nonetheless, we stress that the power of administration does not include acts of
disposition or encumbrance, which are acts of strict ownership. As such, an authority to
dispose cannot proceed from an authority to administer, and vice versa, for the two
powers may only be exercised by an agent by following the provisions on agency of the
Civil Code (from Article 1876 to Article 1878). Specifically, the apparent authority of Atty.
Parulan, being a special agency, was limited to the sale of the property in question, and
did not include or extend to the power to administer the property.

Lastly, the petitioners’ insistence that Atty. Parulan’s making of a counter-offer during
the March 25, 1991 meeting ratified the sale merits no consideration. Under Article 124
of the Family Code, the transaction executed sans the written consent of Dionisio or the
proper court order was void; hence, ratification did not occur, for a void contract could
not be ratified. On the other hand, we agree with Dionisio that the void sale was a
continuing offer from the petitioners and Ma. Elena that Dionisio had the option of
accepting or rejecting before the offer was withdrawn by either or both Ma. Elena and the
petitioners. The last sentence of the second paragraph of Article 124 of the Family Code
makes this clear, stating that in the absence of the other spouse’s consent, the transaction
should be construed as a continuing offer on the part of the consenting spouse and the
third person, and may be perfected as a binding contract upon the acceptance by the other
spouse or upon authorization by the court before the offer is withdrawn by either or both
offerors.

Nobleza v. Nuega
Josefina Nobleza v. Shirley Nuega
G.R. No. 193038, March 11, 2015
Villarama, Jr., J.

FACTS:
Respondent Shirley B. Nuega (Shirley) was married to Rogelio A. Nuega (Rogelio) on September 1,
1990. Upon the request of Rogelio, Shirley sent him money for the purchase of a residential lot in
Marikina where they had planned to eventually build their home. The following year, or on
September 13, 1989, Rogelio purchased the subject house and lot for One Hundred Two Thousand
Pesos (P102,000.00) from Rodeanna Realty Corporation. Shirley claims that upon her arrival in the
Philippines sometime in 1989, she settled the balance for the equity over the subject property with
the developer through SSS8 financing. She likewise paid for the succeeding monthly amortizations.

On September 1, 1990, Shirley and Rogelio got married and lived in the subject property. The
following year, Shirley returned to Israel for work. While overseas, she received information that
Rogelio had brought home another woman, Monica Escobar, into the family home. She also learned
and was able to confirm upon her return to the Philippines in May 1992, that Rogelio had been
introducing Escobar as his wife.

In June 1992, Shirley filed two cases against Rogelio: one for Concubinage before the Provincial
Prosecution Office of Rizal, and another for Legal Separation and Liquidation of Property before the
RTC of Pasig City. In between the filing of these cases, Shirley learned that Rogelio had the intention
of selling the subject property. Shirley then advised the interested buyers one of whom was their
neighbor and petitioner Josefina V. Nobleza (petitioner) – of the existence of the cases that she had
filed against Rogelio and cautioned them against buying the subject property until the cases are
closed and terminated. Nonetheless, under a Deed of Absolute Sale dated December 29, 1992,
Rogelio sold the subject property to petitioner without Shirley’s consent in the amount of Three
Hundred Eighty Thousand Pesos (P380,000.00), including petitioner’s undertaking to assume the
existing mortgage on the property with the National Home Mortgage Finance Corporation and to pay
the real property taxes due thereon.

ISSUE:
Is the Deed of Sale null and void for lack of the consent of the wife?

HELD:
Yes. The petitioner is not a buyer in good faith. A buyer cannot claim to be an innocent purchaser for
value by merely relying on the TCT of the seller while ignoring all the other surrounding
circumstances relevant to the sale.

The nullity of the sale made by Rogelio is not premised on proof of respondent’s financial
contribution in the purchase of the subject property. Actual contribution is not relevant in
determining whether a piece of property is community property for the law itself defines what
constitutes community property.
Article 91 of the Family Code thus provides:
Art. 91. Unless otherwise provided in this Chapter or in the marriage settlements, the community
property shall consist of all the property owned by the spouses at the time of the celebration of the
marriage or acquired thereafter.

The only exceptions from the above rule are: (1) those excluded from the absolute community by the
Family Code; and (2) those excluded by the marriage settlement.

Under the first exception are properties enumerated in Article 92 of the Family Code, which states:

Art. 92. The following shall be excluded from the community property:
(1) Property acquired during the marriage by gratuitous title by either spouse and the fruits as well as
the income thereof, if any, unless it is expressly provided by the donor, testator or grantor that they
shall form part of the community property;
(2) Property for personal and exclusive use of either spouse; however, jewelry shall form part of the
community property;
(3) Property acquired before the marriage by either spouse who has legitimate descendants by a
former marriage, and the fruits as well as the income, if any, of such property.
Since the subject property does not fall under any of the exclusions provided in Article 92, it,
therefore, forms part of the absolute community property of Shirley and Rogelio. Regardless of their
respective contribution to its acquisition before their marriage, and despite the fact that only
Rogelio’s name appears in the TCT as owner, the property is owned jointly by the spouses Shirley
and Rogelio.

HEIRS OF PROTACIO GO, SR. et. al. v. SERVACIO and GO

G.R. No. 157537, [September 7, 2011]

FACTS:

Gaviola and Protacio, Jr. entered into a contract ofsale of a parcel of land. 23 years later,
Protacio, Jr executed an Affidavit of Renunciation and Waiver affirming under oath that
it was his father Protacio Go, Sr.(Married to Marta Go) who purchased the said property.
Subsequently, Protacio Go together with his son Rito Go sold a portion of the property to
herein respondent Ester Servacio. On March 2, 2001, the petitioners demanded the return
of the property, but Servacio refused to heed their demand; hence this case for
the annulment of sale of the property. The contention of the petitioner was that following
Protacio, Jr.’s renunciation, the property became conjugal property; and that the sale of
the property to Servacio without the prior liquidation of the community property between
Protacio, Sr. and Marta was null and void pursuant to Article 130 of the Family Code.
Servacio and Rito countered that Article 130 of the Family Code was inapplicable; that the
want of the liquidation prior to the sale did not render the sale invalid, because the sale
was valid to the extent of the portion that was finally allotted to the vendors as his share;
and that the sale did not also prejudice any rights of the petitioners as heirs, considering
that what the sale disposed of was within the aliquot portion of the property that the
vendors were entitled to as heirs.

The RTC declared that the property was the conjugal property of Protacio, Sr. and Marta,
not the exclusive property of Protacio, Sr. Nonetheless, the RTC affirmed the validity of
the sale of the property. Aggrieved, the petitioners went all the way up to the Supreme
Court.

ISSUE:

Whether Article 130 of the Family Code was applicable.

HELD:

The appeal lacks merit.

Under Article 130 in relation to Article 105 of the Family Code,any disposition of
the conjugal property after the dissolution of the conjugal partnership must be made only
after the liquidation; otherwise, the disposition is void. Upon Marta’s death in 1987,
the conjugal partnership was dissolved, pursuant to Article 175 (1) of the Civil Code, and
an implied ordinary co-ownership ensued among Protacio, Sr. and the other heirs of
Marta with respect to her share in the assets of the conjugal partnership pending a
liquidation following its liquidation.

Protacio, Sr., although becoming a co-owner with his children in respect of Marta’s share
in the conjugal partnership, could not yet assert or claim title to any specific portion of
Marta’s share without an actual partition of the property being first done either by
agreement or by judicial decree. Until then, all that he had was an ideal or abstract quota
in Marta’s share. Nonetheless, a co-owner could sell his undivided share; hence, Protacio,
Sr. had the right to freely sell and dispose of his undivided interest, but not the interest of
his co-owners. Consequently, the sale by Protacio, Sr. and Rito as co-owners without
the consent of the other co-owners was not necessarily void, for the rights of the selling
co-owners were thereby effectively transferred, making the buyer (Servacio) a co-owner
of Marta’s share. Article 105 of the Family Code, supra, expressly provides that the
applicability of the rules on dissolution of the conjugal partnership
is “without prejudice to vested rights already acquired in accordance with
the Civil Code or other laws.”

The proper action in cases like this is not for the nullification of the sale or for the recovery
of possession of the thing owned in common from the third person who substituted the
co-owner or co-owners who alienated their shares, but the DIVISION of the common
property as if it continued to remain in the possession of the co-owners who possessed
and administered it [Mainit v. Bandoy, supra] In the meanwhile, Servacio would be a
trustee for the benefit of the co-heirs of her vendors in respect of any portion that might
not be validly sold to her.

DELA PENA V. AVILA

G.R. No. 187490, [February 08, 2012]

FACTS:

Antonia Dela Pena (Antonia) obtained from A.C.Aguila & Sons, Co. (Aguila) a loan in the
sum of P250,000.00 with interest pegged at 5% per month. Antonia executed a
promissory note and a notarized Deed of Real Estate Mortgage over a 277 square meter
parcel of residential land, together with the improvements thereon, situated in Marikina
City and previously registered in the name of petitioner Antonia R. Dela Peña (Antonia),
“married to Antegono A. Dela Peña” (Antegono) under Transfer Certificate of Title (TCT)
No. N-32315 of the Registry of Deeds of Rizal.[to secure the payment of the loan
obligation.

Antonia executed another notarized Deed of Absolute Sale over the property in favor of
Gemma Remilyn C. Avila (Gemma), for the stated consideration of P600,000.00. As such
Gemma caused the transfer of the aforesaid property to her name. Gemma also
constituted a real estate mortgage over same property in favor of FEBTC-BPI, to secure a
loan facility with a credit limit of P1,200,000.00.
Antonia filed with the Register of Deeds of Marikina an Affidavit of Adverse Claim, that
she was the true and lawful owner of the property and, that the Deed of Absolute Sale
Gemma utilized in procuring her title was simulated. The Register of Deeds inscribed the
adverse claim.

FEBTC-BPI caused an extrajudicial foreclosure of the real estate mortgage constituted

Antonia and her son, petitioner Alvin Dela Peña (Alvin), filed against Gemma the
complaint for annulment of deed of sale as the subject realty was conjugal property, and
that the Deed of Real Estate Mortgage Antonia executed in favor of Aguila was not
consented to by Antegono who was already dead by that time. Gemma specifically denied
the material allegations, maintaining that the realty was the exclusive property
of Antonia who misrepresented that her husband was still alive.

RTC held that the subject property was conjugal in nature and that the Deed of Absolute
Sale Antonia executed in favor of Gemma was void as a disposition without the
liquidation required under Article 130 of the Family Code. CA reversed the RTC decision,
stating that the property was paraphernal in nature for failure of the Dela Peñas to prove
that the same was acquired during Antonia’s marriage to Antegono. Furthermore, that
the Deed of Absolute Sale in favor of Avila and the subsequent sale on auction of the
subject property to FEBTC-BPI are upheld as valid and binding. Hence this petition.

ISSUE:

Whether or not the CA erred in reversing the RTC holding the house and lot covered by
TCT No. N-32315 conjugal property of the spouses Antegono and Antonia Dela Peña.

HELD:

No, petition is denied. CA decision affirmed in toto.

RATIO:

Pursuant to Article 160 of the NCC, all property ofthe marriage is presumed to belong to
the conjugal partnership, unless it is proved that it pertains exclusively to the husband or
to the wife. Although it is not necessary to prove that the property was acquired with funds
of the partnership, proof of acquisition during the marriage is an essential condition for
the operation of the presumption in favor of the conjugal partnership. In the case of
Francisco vs. Court of Appeals, the Court said that the party who invokes the presumption
under Art. 160 of the NCC, must first prove that the property in controversy was acquired
during the marriage. Proof of acquisition during the coverture is a condition sine qua non
for the operation of the presumption in favor of the conjugal partnership. The party who
asserts this presumption must first prove said time element. Needless to say, the
presumption refers only to the property acquired during the marriage and does not
operate when there is no showing as to when property alleged to be conjugal was
acquired. Moreover, this presumption in favor of conjugality is rebuttable, but only with
strong, clear and convincing evidence; there must be a strict proof of exclusive ownership
of one of the spouses.

As the parties invoking the presumption of conjugality, the Dela Peñas did not even come
close to proving that the subject property was acquired during the marriage
between Antonia and Antegono. Beyond Antonia’s bare and uncorroborated assertion
that the property was purchased when she was already married, the record is bereft of any
evidence from which the actual date of acquisition of the realty can be ascertained.

In the case Ruiz vs. Court of Appeals, the phrase “married to” is merely descriptive of the
civil status of the wife and cannot be interpreted to mean that the husband is also a
registered owner. Because it is likewise possible that the property was acquired by the
wife while she was still single and registered only after her marriage, neither would
registration thereof in said manner constitute proof that the same was acquired during
the marriage and, for said reason, to be presumed conjugal in nature. “Since there is no
showing as to when the property in question was acquired, the fact that the title is in the
name of the wife alone is determinative of its nature as paraphernal, i.e., belonging
exclusively to said spouse.”

As such, the nature of the property is paraphernal and the CA correctly ruled that the RTC
reversibly erred in nullifying Antonia’s sale thereof in favor of Gemma, for lack of the
liquidation required under Article 130 of the Family Code. Furthermore, Antonia treated
the realty as her own exclusive property may, in fact, be readily gleaned from her
utilization thereof as security for the payment of the P250,000.00 loan she borrowed
from Aguila.