PS 116
CIVIL LAW 1
Group 1
Absolute Community of Property
Members:
ACLAYAN, Umandam
CUHMALING, Jhenette
DIONISIO, Datu Laureano
ESCAT, Erica
MABUTAS, Kastlerdale
NGASEO, Titus
PANGUSBAN, Xiandrei
SAWATANG, Rommel James
TUDIAS, Cole Steven
INTRODUCTION
When two people marry in the Philippines, their union is not just emotional
and spiritual, it also has legal and financial implications. One of the most important
aspects is the property regime, or how the couple's properties will be governed
during and after marriage. Unless a couple agrees otherwise through a prenuptial
agreement, the default property regime under Philippine law is called the Absolute
Community of Property (ACP).
Under Absolute Community of Property ( ACP), the husband and wife become
co-owners of all property they each owned before the marriage and all property they
acquire during the marriage (with some specific exceptions like inherited property or
purely personal items other than jewelry). This means most assets are pooled into a
single fund, owned equally by both spouses, reflecting the view of marriage as a
complete partnership where both contribute to the union's resources. The general
rule under ACP is "what's yours is mine, and what's mine is yours," forming one
common fund from the moment of marriage.
This regime is governed by the Family Code of the Philippines, particularly Articles
75 to 90.
KEY FEATURES
1. Automatic Application
Applies by default if the spouses did not execute a marriage settlement
before the marriage.
2. Commencement
Begins from the moment the marriage is celebrated.
3. Scope of Community Property
Includes all properties owned by either or both spouses at the time of
marriage and those acquired during the marriage.
4. Exclusions from the Community
Properties acquired by gratuitous title (e.g., inheritance, donation),
personal and exclusive-use items (except luxury items like jewelry), and
properties acquired before marriage by a spouse with legitimate children from
a previous marriage.
5. Equal Sharing Upon Dissolution
Upon dissolution of marriage (e.g., death, annulment, legal separation), the
community property is equally divided between the spouses or their heirs.
6. Debts and Obligations
Family-benefiting debts are charged to the community property; personal
debts before marriage remain personal unless shown to benefit the family.
7. Substitute Regime
Can only be replaced by another property regime (e.g., Conjugal
Partnership or Separation of Property) through a valid prenuptial agreement.
ADMINISTRATION OF THE PROPERTY
1. Joint Administration
● Both spouses are considered co-administrators of the ACP, meaning they
share equal rights and responsibilities in managing the community property.
This includes making decisions about the use, enjoyment, and preservation of
community property.
● Practical Implications: This means that both spouses have a say in how the
community property is used and maintained. They both have the right to
access information about the property and to participate in decision-making.
● Disagreements: In cases of disagreement, the husband's decision generally
prevails, but the wife can seek recourse in court if she believes the decision is
detrimental to the family.
2. Consent Requirement for Major Transactions
● Neither spouse can dispose of, mortgage, encumber, or lease community
property without the consent of the other spouse. This consent requirement
applies to major transactions that could significantly affect the value or
ownership of the community property.
● Practical Implications: This means that both spouses must agree to any sale,
mortgage, or lease of community property. This protects both spouses from
unilateral decisions that could negatively affect their financial interests.
● Consequences of Non-Consent: Transactions made without the other
spouse's consent may be void or voidable, depending on the circumstances.
This means that the transaction may be legally invalid and can be challenged
in court.
3. Exceptional Administration Rights
● If one spouse is incapacitated, absent, or unable to act, the other spouse may
administer the ACP, but they must secure court authorization for certain
transactions. This ensures that the community property is managed
responsibly and protects the interests of both spouses.
● Practical Implications: This means that the other spouse can take on the
responsibility of managing the property but only with court approval for major
decisions. This safeguards against potential abuse of power and ensures that
the property is managed for the benefit of both spouses.
● Court Authorization: The court will review the proposed transactions and
ensure they are in the best interests of the family and the ACP.
DISPOSITION
Joint Ownership and Administration
● Both spouses co-own and jointly administer the ACP.
● Either spouse may manage or dispose of community property, but:
○ Consent of the other spouse is generally required for acts of
administration or disposition (e.g., selling a house, leasing a car
longer than one year).
Unauthorized Disposition
● If one spouse disposes of community property without the consent of the
other, the act is considered voidable unless:
○ Ratified by the other spouse.
○ It falls under urgent or necessary circumstances.
Disposition Upon Dissolution of Marriage
The ACP is dissolved and liquidated when:
1. The marriage is annulled or declared void.
2. There is a legal separation.
3. One of the spouses dies.
4. Judicial separation of property is granted.
Steps in the Disposition Process:
1. Payment of Debts and Obligations
○ All community debts and obligations are settled first.
○ If the ACP is insufficient, separate property of the spouses may be
used.
2. Reimbursement and Return of Exclusive Property
○ Each spouse is reimbursed for their exclusive property used to benefit
the ACP.
○ Exclusive properties brought into the marriage are returned.
3. Equal Division of Remaining Properties
○ The remaining community assets are divided equally, regardless of
which spouse earned more or contributed more.
Included:
● Salaries and income earned during marriage.
● Properties acquired before marriage, unless excluded.
● Fruits (i.e., interest, rent) from exclusive property.
Excluded:
● Properties acquired by inheritance or donation (unless expressly stated to
be part of the community).
● Personal belongings or property for exclusive personal use.
● Properties acquired before marriage by either spouse that are considered
exclusive.
Dissolution
The Family Code of the Philippines governs the dissolution of the Absolute
Community of Property (ACP), the default property regime for marriages in the
Philippines defined in Article 75. This regime dictates that all properties acquired
during the marriage, except those acquired through inheritance or donation, belong
equally to both spouses. The ACP commences upon the celebration of the marriage
according to Article 88. However, several events can lead to its dissolution, triggering
a process of elimination and distribution of assets.
The ACP has certain grounds for dissolution according to Article 99 which
dissolves upon the occurrence of any of the following:
● Death of spouse: Which is the most straightforward cause. Upon death, the
ACP is dissolved, and the estate undergoes probate proceedings to
determine the inheritance of the surviving spouse including heirs.
● Decree of Legal Separation: A legal separation, granted by a court, severs
the marital bond but does not dissolve the marriage itself. However, it does
dissolve the ACP, requiring the removal of community assets. The court will
order the division of the properties.
● Decree of Annulment: If a marriage is declared void or annulled, the ACP is
dissolved retroactively to the date of the marriage's commemoration. It
means that all properties acquired during the supposed marriage are treated
as if they were never part of the ACP. The court will determine the ownership
of the assets. In cases of nullity due to psychological incapacity (Article 36),
and Article 103 applies, often resulting in the confiscation of the reproachable
spouse's share.
● Judicial Separation of Property: This is a court-ordered separation of the
spouses' properties during the marriage. While it doesn't dissolve the
marriage, it effectively ends the ACP regime, replacing it with a regime of
separate properties. Each spouse manages their own assets.
● Abandonment or Absence: In specific circumstances involving prolonged
abandonment or absence, the court may dissolve the ACP. This requires a
judicial determination of the abandonment or absence and its impact on the
marital relationship and the community property.
Effects and Processes of Dissolution
1. Article 102: Liquidation Process of the Absolute Community Property
● Inventory of Assets: Upon dissolution of the ACP, an inventory must be
prepared that lists all community properties and the exclusive properties of
each spouse to determine the subjects for division.
● Payment of Debts and Obligations: The debts and obligations incurred during
the marriage must be settled using the assets of the community.
● Delivery of Presumptive Legitimes: The presumptive legitimes, which refer to
the shares of the children in the community property, must be delivered before
the final partition of the remaining assets. This ensures that the children's
rights to inheritance are recognized and protected.
● Partition and Distribution of Remaining Assets: After debts are settled and
presumptive legitimes are delivered, the remaining assets of the ACP are
divided equally between the spouses.
2. Article 103: Nullity of Marriage Based on Psychological Incapacity
● The same liquidation process outlined in Article 102 applies when the
dissolution of the ACP is due to the nullity of marriage based on psychological
incapacity (Article 36). This means that the steps of inventorying assets,
paying debts, delivering presumptive legitimes, and partitioning remaining
assets are followed.
● Forfeiture of Share: If one party is found at fault for the psychological
incapacity, they forfeit their share of the community property. This forfeited
share is allocated in favor of the common children or the innocent spouse.
Relevant Related Provisions:
● Article 50: This article addresses the effects of annulment or nullity on
property regimes. It stipulates that presumptive legitimes must be delivered to
children before the liquidation process begins, ensuring that children's rights
are prioritized in the distribution of assets.
● Article 51: It specifically provides for the delivery of presumptive legitimes to
the children, reinforcing their entitlement to a share of the community property
upon the dissolution of the marriage.
● Article 52: This article mandates that the decree of nullity or legal separation,
along with the liquidation of community property, must be registered to have
legal effects on third parties. Registration is essential for the protection of the
rights of the parties involved and to inform third parties of the changes in
property status.
● Article 53: It discusses the consequences of remarrying without proper
liquidation and registration. If a person remarries before completing these
legal processes, the subsequent marriage is void. This provision serves to
protect the integrity of marital contracts and the property rights associated
with them.
RIGHTS AND OBLIGATION
Joint Ownership
Refers to a future spouse have equal ownership rights over property or
assets. Regardless of individual efforts, both spouses have equal rights to the
property earned after marriage under Family Code of the Philippines in
absolute community of property rule. Both must agree on the management
and use of the property, and divided only upon the dissolution of the marriage.
Relevant Case:
G.R. No. 193038, March 11, 2015 JOSEFINA V. NOBLEZA, Petitioner, v.
SHIRLEY B. NUEGA, Respondent
● In this case selling community property without the spouse’s consent is
void, and buyers must verify the seller’s authority to ensure the
transaction is valid.
Related Article:
Article 91
Ownership of Property Acquired During the Marriage
"All property owned by the spouses at the time of the celebration of the
marriage, and all property acquired thereafter by the spouses during the
marriage, whether acquired by gratuitous or onerous title, shall be presumed
to be part of the community property, except for property that is excluded by
law.”
Mutual support
The obligation of both spouses to each other and their children is to
provide financial, emotional, and physical support under the Family Code
of the Philippines wherein it detailed how spouses must support each other in
all aspects of married life, caring for the children's welfare and even to the
splitting up of the financial dilemmas.
Relevant Case:
Carolyn T. Mutya-Sumilhig vs. Joselito T. Sumilhig and Republic of the
Philippines (G.R. No. 230711)
● The Court ruled that psychological incapacity must be a deep-seated,
enduring condition existing at the time of marriage, rendering a spouse
unable to fulfill essential marital obligations. This incapacity is
characterized by its juridical antecedence (pre-existing the marriage),
incurability (persistent and unresponsive to treatment), and gravity
(severely affecting marital responsibilities).
Related Article:
Article 68
“The husband and wife are obliged to live together, observe mutual love,
respect and fidelity, and render mutual help and support.”
Co-management of Property
Both spouses share equal responsibility in managing and making
decisions about their community property. Both must agree on major
decisions, and while either spouse can handle day-to-day matters, they must
act in the best interest of the family.
Relevant Case:
G.R. No. 253450, January 22, 2024 LANI NAYVE-PUA, PETITIONER, VS.
UNION BANK OF THE PHILIPPINES, RESPONDENT.
● The Court ruled that this property remained Stephen's exclusive
property, as it was acquired before the marriage and with his personal
funds. The presumption of conjugal ownership applies only to
properties acquired during the marriage. Therefore, Lani Nayve had no
legal claim over the property in question.
Related Article:
Article 80
Administration of the Community Property shall belong to both spouses
jointly. However, either spouse may, without the consent of the other,
administer property acquired before the marriage and the exclusive property
of either spouse acquired during the marriage in the absence of an agreement
to the contrary."
Child Support and Upbringing
This mainly refers to the legal obligation of parents that needs to provide for
the maintenance, education and well-being of their children whether legitimate
or illegitimate including a household, clothing, education and also medical
needs. While upbringing refers to the moral guidance, nurturing and
education of the child which must be responsibly equal in sharing by both the
mother and father.
Relevant Case:
Batungbakal vs. Batungbakal, G.R. No. L-20672, July 26, 1966
● The case has emphasized the obligation of parents which have to
provide support in proportion to their means and the needs of the child
wherein the Court also clarified that even if the parents are separated,
they are not exempted from this duty.
Related Articles:
Article 91
Establishes joint administration and responsibility of both spouses over
community property including child support.
Article 94
Enumerates the liabilities of the absolute community property which
includes support of the spouses, common children and also legitimate
children of either spouse.
Obligation to Manage Finances
The obligation to manage finances refers to the joint responsibility of both
spouses to manage the family’s community property or conjugal
partnership which will be depending on their property regime. Knowingly that
each spouse has the right to manage and dispose of the property but
significant transactions may require consent from the other spouse.
Relevant Case:
Valdes v. RTC, G.R. No. 122749, June 9, 1997
● The Supreme Court ruled that both spouses must jointly manage the
community property and that a unilateral act affecting community
property like the sale of a conjugal property without the other’s consent
is voidable.
Related Articles:
Article 96
In the event of disagreement between spouses regarding administration,
the court shall decide.
Article 89
There is no waiving of rights, wherein the shares and effects of absolute
community property during marriage can be made yet there’s an exemption if
it is a case of judicial separation of property.
Article 75
States that property relations between spouses are governed defaulting
to absolute community unless otherwise agreed.
EXEMPTION AND MODIFICATION
Exemptions from the Absolute Community Property (ACP):
Under Article 92 of the Family Code, certain properties are excluded from the
ACP, including:
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. (201a)
Modification
Under Article 75 of the Civil Law it is established that future spouses may agree
upon a certain regime of property, as the absence of a marriage settlement, or
when the regime agreed upon is void, the system of absolute community of
property as established in this Code shall govern.
Enumerated under Article 76, it is stated that in order for any modification in the
marriage settlements may be valid, it must be:
a. Made before the celebration of the marriage;
b. Subject to the provisions of Articles 66 (Effects of Legal Separation);
c. Subject to the provisions of Articles 67 (Succession Rights after Legal
Separation);
d. Subject to the provisions of Articles 128 (Judicial Separation of Property);
e. Subject to the provisions of Articles 135 (Grounds for Modification of Property
Regime) and;
f. Subject to the provisions of Articles 136 (Court Approval of Modification).
The marriage settlements and any modification shall be (Article 77):
a. In writing
b. Signed by the parties and executed before the celebration of the
marriage
c. They shall not prejudice third persons unless they are registered in the
local civil registry where the marriage contract is recorded as well as in the
proper registries of properties.
Article 128 further discussed that If a spouse without just cause abandons the
other or fails to comply with his or her obligation to the family, the aggrieved spouse
may petition the court for receivership, for judicial separation of property, or
for authority to be the sole administrator of the conjugal partnership property,
subject to such precautionary conditions as the court may impose. A spouse is
deemed to have abandoned the other when:
a. He or she has left the conjugal dwelling without intention of returning.
b. 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.
Prima facie - based on the first impression; accepted as correct until proved
otherwise.
Any of the following shall be considered sufficient cause for judicial separation of
property (Article 135):
1. That the spouse of the petitioner has been sentenced to a penalty which
carries with it civil interdiction;
2. That the spouse of the petitioner has been judicially declared an absentee;
3. That loss of parental authority of the spouse of petitioner has been decreed
by the court;
4. That the spouse of the petitioner has abandoned the latter or failed to
comply with his or her obligations to the family as provided for in Article
101;
5. That the spouse granted the power of administration in the marriage
settlements has abused that power; and
6. That at the time of the petition, the spouses have been separated in fact
for at least one year and reconciliation is highly improbable.
Finally, under Article 136, the spouses may jointly file a verified petition with the
court for the voluntary dissolution of the absolute community or the conjugal
partnership of gains, and for the separation of their common properties.
Relevant Case: David A. Noveras v. Leticia T. Noveras (G.R. No. 188289)
In the case of Noveras v. Noveras, the modification lies in the judicial separation of
property despite the absence of a recognized foreign divorce. While the spouses
remained legally married under Philippine law due to the non-recognition of the
California divorce, the Supreme Court applied Article 135 of the Family Code,
which allows for the judicial separation of property when the spouses have been
separated de facto for at least one year and reconciliation is highly improbable.
