There is no evidence on the record to show that he has squandered the conjugal assets. The refusal or failure of the husband as administrator of the conjugal partnership to inform the wife of the progress of the family businesses does not constitute in abuse.
BA Finance Corp vs. CA (GR 61464, May 28 1988)
FACTS:
Augusto Yulo secured a loan from the petitioner in the amount of P591,003.59 as evidenced by a promissory note he signed in his own behalf and as a representative of A&L Industries. Augusto presented an alleged special power of attorney executed by his wife, Lily Yulo, who managed the business and under whose name the said business was registered, purportedly authorized the husband to procure the loan and sign the promissory note. 2months prior the procurement of the loan, Augusto left Lily and their children which in turn abandoned their conjugal home. When the obligation became due and demandable, Augusto failed to pay the same.
The petitioner prayed for the issuance of a writ of attachment alleging that said spouses were guilty of fraud consisting of the execution of Deed of Assignment assigning the rights, titles and interests over a construction contract executed by and between the spouses and A. Soriano Corporation. The writ hereby prayed for was issued by the trial court and not contented with the order, petitioner filed a motion for the examination of attachment debtor alleging that the properties attached by the sheriff were not sufficient to secure the satisfaction of any judgment which was likewise granted by the court.
ISSUE:
Whether or not A&L Industries can be held liable for the obligations contracted by the husband.
HELD:
A&L Industries is a single proprietorship, whose registered owner is Lily Yulo. The said proprietorship was established during the marriage and assets were also acquired during the same. Hence, it is presumed that the property forms part of the conjugal partnership of the spouses and be held liable for the obligations contracted by the husband. However, for the property to be liable, the obligation contracted by the husband must have redounded to the benefit of the conjugal partnership. The obligation was contracted by Augusto for his own benefit because at the time he incurred such obligation, he had already abandoned his family and left their conjugal home. He likewise made it appear that he was duly authorized by his wife in behalf of the company to procure such loan from the petitioner. Clearly, there must be the requisite showing that some advantage accrued to the welfare of the spouses.
Thus, the Court ruled that petitioner cannot enforce the obligation contracted by Augusto against his conjugal properties with Lily. Furthermore, the writ of attachment cannot be issued against the said properties and that the petitioner is ordered to pay Lily actual damages amouting to P660,000.00.
Johnson & Johnson (Phils.) Inc. vs. Court Of Appeals and Alejo M. Vinluan (G.R. No. 102692 23 September 1996)
FACTS:
On several occasions in 1982, the defendant, Delilah Vinluan, purchased products of Johnson & Johnson, as she was also engaged in the business of retailing Johnson products, among others. The defendants, under the name and style of “Vinluan Enterprises,” thus incurred an obligation of P235,880.89 for which she issued seven Philippine Banking Corporation checks of varying amounts and due dates. However, the checks were dishonoured for having been drawn against insufficient funds. Several extensions were given to the spouses to settle the obligation. On 05 January 1983, the defendant spouses made a partial payment of P5,000.00, but made no further payments afterwards. The trial court found that Alejo Vinluan, had no privity of contract, whether direct or indirect, regarding those obligations incurred by his wife, as he only became a co-owner of Vinluan Enterprises after the obligations involved in this action had been incurred by Delilah. In addition, said obligations were contracted without the husband’s knowledge or consent, and that the conjugal partnership never derived benefit therefrom.
The trial court decided that Alejo should not be held liable for the obligations incurred by his wife without his knowledge or consent. However, when notices of levy on execution were issued, these covered not only Delilah’s exclusive or paraphernal properties, but also the real and personal properties of the conjugal partnership of the spouses Vinluan. This has caused Alejo to file a third-party claim, which was denied by the trial court.
ISSUE:
Whether or not the order of the trial court denying private respondent’s third-party claim and motion to quash levy on execution in effect amended the dispositive portion of the trial court’s decision which had long become final and executory.
HELD:
NO, THE TRIAL COURT CANNOT, IN THE GUISE OF DECIDING THE THIRD-PARTY CLAIM, REVERSE ITS FINAL DECISION.
In order to bind the conjugal partnership and its properties, the law provides that the debts and obligations contracted must be for the benefit of the conjugal partnership; and that the husband must consent to his wife’s engaging in business. The text of the trial court’s decision points to no other person liable but Delilah Vinluan, and in fact made a rather lengthy discussion on the exemption from liability of the conjugal partnership; hence, there can be no ambiguity to speak of in the decision. And even more clearly, the body of the decision of the trial court expressly exempted private respondent from liability by categorically ruling that “the defendant- husband cannot, together, with the co-defendant legally be made liable for the obligations contracted by the wife.”
Spouses Laperal vs Spouses Katigbak (GR 16991, March 31, 1964)
CFI Manila declared the property covered by TCT No.57626 as separate or paraphernal property of Evelina Kalaw-Katigbak. The spouses Laperal disagree with this finding reiterating that its improvements and income are conjugal assets of the Spouses Katigbak.
When the spouses Katigbak got married, neither of them brought properties unto the marriage. Ramon’s occupation rendered him a monthly income of P200.00. The property in question was registered in the name of “Evelina Kalaw-Katigbak married to Ramon Katigbak”. The latter declared that her mother was the one who bought the property for her and had placed it only in her name as the practice of her mother in buying properties and placing them directly in the names of her children. The husband having no interest with the property only signed the document for the purpose of assisting his wife.
In August 1950, the Laperals filed a case and was granted by the trial court against the Katigbaks in recovery of P14,000 and jewelry amounting to P97,500 or in lieu thereof, to pay such amount. A month after the decision was rendered, Evelina filed a complaint against her husband for judicial separation of property and separate administration which was granted by the court and was sought for annulment by the Laperals.
ISSUE:
Whether or not the property in question constitutes the paraphernal property of Evelina.
HELD:
All properties acquired during the marriage are presumed conjugal. It is however not conclusive but merely rebuttable, unless it be proved that the property belong exclusively to the husband and wife. In the case at bar, the deed of the land is under the name of the wife. At the time it was purchased, the property was of substantial value and as admitted, the husband by himself could not have afforded to buy considering the singular source of income.
Hence, the property covered by TCT 57626 is considered a paraphernal property of the wife.
Villanueva vs. IAC
(GR No. 67582, October 29, 1987)
FACTS:
Modesto Aranas, husband of Victoria, inherited a land from his father. Dorothea and Teodoro, Modesto’s illegitimate children, borrowed money from private respondent Jesus Bernas, mortgaging as collateral their father’s property. In the loan agreement, Aranas described themselves as the absolute co-owners. Dorothea and Teodoro failed to pay the loan resulting to extrajudicial foreclosure of mortgage in 1977 and thereafter Bernas acquired the land as the highest bidder. Aftewards, the Aranases executed a deed of extrajudicial partition in 1978, in which they adjudicated the same land unto themselves in equal share pro-indiviso. Bernas then consolidated his ownership over the lot when the mortgagors failed to redeem it withn the reglementary period, and had the title in the name of Modesto cancelled and another TCT issued in his name.
In 1978, petitioner Consolacion Villanueva and Raymundo Aranas filed a complaint against respondents spouses Jesus and Remedios Bernas, for the cancellation of the TCT under the name of the Bernases, and they be declared co-owners of the land. Petitioner alleged that spouses Modesto and Victoria in 1987 and 1958 executed 2 separate wills: first bequeathing to Consolacion and Raymundo and to Dorothea and Teodoro, in equal shares pro diviso, all of said Victoria’s shares from the conjugal partnership property; and second
Modesto’s interests in his conjugal partnership with Victoria as well as his separate properties bequeathed to Dorothea and Teodoro. Trial court dismissed the complaint, declaring herein respondents as the legal owners of the disputed property. IAC likewise affirmed the lower court’s decision.
ISSUE:
Whether or not Villanueva had a right over the land and the improvements thereon made by Victoria who rendered the lot as conjugal property.
HELD:
The land was not a conjugal partnership property of Victoria and Modesto. It was Modesto’s exclusive property since he inherited it from his parents. Moreover, since Victoria died ahead of Modesto, Victoria did not inherit said lot from him and therefore had nothing of the land to bequeath by will of otherwise to Consolacion.
Article 158 of the Civil Code says that improvements, whether for utility or adornment made on the separate property of the spouses through advancements from the partnership or through the industry of either spouse belong to the conjugal partnership, and buildings constructed at the expense of the partnership during the marriage on land belonging to one of the spouses also pertain to the partnership, but the value of the land shall be reimbursed to the spouse who owns the same.
There was no proof presented by Villanueva. Such proof is needed at the time of the making or construction of the improvements and the source of the funds used thereof in order to determine the character of the improvements as belonging to the conjugal partnership or to one spouse separately. What is certain is that the land on which the improvements stand was the exclusive property of Modesto and that where the property is registered in the name of one spouse only and there is no showing of when precisely the property was acquired, the presumption is that is belongs exclusively to said spouse. It is not therefore possible to declare the improvements to be conjugal in character.
Furthermore, Bernas’ mode of acquisition of ownership over the property appears in all respect to be regular, untainted by any defect whatsoever. Bernas must therefore be deemed to have acquired indefeasible and clear title to the lot which cannot be defeated or negated by claims subsequently arising and of which he had no knowledge or means of knowing prior to their assertion and ventilation.
BPI vs. Posadas
FACTS:
BPI, as administrator of the estate of deceased Adolphe Schuetze, appealed to CFI Manila absolving defendant, Collector of Internal Revenue, from the complaint filed against him in recovering the inheritance tax amounting to P1209 paid by the plaintiff, Rosario Gelano Vda de Schuetze, under protest, and sum of P20,150 representing the proceeds of the insurance policy of the deceased.
Rosario and Adolphe were married in January 1914. The wife was actually residing and living in Germany when Adolphe died in December 1927. The latter while in Germany, executed a will in March 1926, pursuant with its law wherein plaintiff was named his universal heir. The deceased possessed not only real property situated in the Philippines but also personal property consisting of shares of stocks in 19 domestic corporations. Included in the personal property is a life insurance policy issued at Manila on January 1913 for the sum of $10,000 by the Sun Life Assurance Company of Canada, Manila Branch. In the insurance policy, the estate of the deceased was named the beneficiary without any qualification. Rosario is the sole and only heir of the deceased. BPI, as administrator of the decedent’s estate and attorney in fact of the plaintiff, having been demanded by Posadas to pay the inheritance tax, paid under protest. Notwithstanding various demands made by plaintiff, Posadas refused to refund such amount.
ISSUE:
Whether or not the plaintiff is entitled to the proceeds of the insurance.
HELD:
SC ruled that(1)the proceeds of a life-insurance policy payable to the insured's estate, on which the premiums were paid by the conjugal partnership, constitute community property, and belong one-half to the husband and the other half to the wife, exclusively; (2)if the premiums were paid partly with paraphernal and partly conjugal funds, the proceeds are likewise in like proportion paraphernal in part and conjugal in part; and (3)the proceeds of a life- insurance policy payable to the insured's estate as the beneficiary, if delivered to the
testamentary administrator of the former as part of the assets of said estate under probate administration, are subject to the inheritance tax according to the law on the matter, if they belong to the assured exclusively, and it is immaterial that the insured was domiciled in these Islands or outside.
Hence, the defendant was ordered to return to the plaintiff one-half of the tax collected upon the amount of P20,150, being the proceeds of the insurance policy on the life of the late Adolphe Oscar Schuetze, after deducting the proportional part corresponding to the first premium.
Wong vs. IAC
(GR No. 70082, August 19, 1991)
FACTS:
Romario Henson married Katrina on January 1964. They had 3 children however, even during the early years of their marriage, the spouses had been most of the time living separately. During the marriage or on about January 1971, the husband bought a parcel of land in Angeles from his father using the money borrowed from an officemate. Sometime in June 1972, Katrina entered an agreement with Anita Chan where the latter consigned the former pieces of jewelry valued at P321,830.95. Katrina failed to return the same within the 20 day period thus Anita demanded payment of their value. Katrina issued in September 1972, check of P55,000 which was dishonored due to lack of funds. The spouses Anita Chan and Ricky Wong filed action for collection of the sum of money against Katrina and her husband Romarico. The reply with counterclaim filed was only in behalf of Katrina. Trial court ruled in favor of the Wongs then a writ of execution was thereafter issued upon the 4 lots in Angeles City all in the name of Romarico Henson married to Katrina Henson. 2 of the lots were sold at public auction to Juanito Santos and the other two with Leonardo Joson. A month before such
redemption, Romarico filed an action for annulment of the decision including the writ and levy of execution.
ISSUE:
Whether or not debt of the wife without the knowledge of the husband can be satisfied through the conjugal property.
HELD:
The spouses had in fact been separated when the wife entered into the business deal with Anita. The husband had nothing to do with the business transactions of Katrina nor authorized her to enter into such. The properties in Angeles were acquired during the marriage with unclear proof where the husband obtained the money to repay the loan. Hence, it is presumed to belong in the conjugal partnership in the absence of proof that they are exclusive property of the husband and even though they had been living separately. A wife may bind the conjugal partnership only when she purchases things necessary for support of the family. The writ of execution cannot be issued against Romarico and the execution of judgments extends only over properties belonging to the judgment debtor. The conjugal properties cannot answer for Katrina’s obligations as she exclusively incurred the latter without the consent of her husband nor they did redound to the benefit of the family. There was also no evidence submitted that the administration of the partnership had been transferred to Katrina by Romarico before said obligations were incurred. In as much as the decision was void only in so far as Romarico and the conjugal properties concerned, Spouses Wong may still execute the debt against Katrina, personally and exclusively.
AYALA INVESTMENT & DEVELOPMENT CORP. and ABELARDO MAGSAJO, petitioners, vs. COURT OF APPEALS and SPOUSES ALFREDO & ENCARNACION CHING, respondents. [G.R. No. 118305. February 12, 1998]
FACTS :
Philippine Blooming Mills loan from petitioner Ayala Investment. As an added security for the credit line extended to PBM, respondent Alfredo Ching – Exec. VP, executed security agreements and making himself jointly and severally answerable with PBM’s indebtedness to Ayala Investments, PBM failed to pay the loan. Thus, Ayala Investments filed a case for sum of money against PBM and Alfredo Ching. The lower court issued a writ of execution of pending appeal. Thereafter, deputy sheriff Magsajo caused issuance and service upon respondents- spouses of a notice of sheriff sale on three of their conjugal properties.
Private respondents, spouses Ching, filed a case of injunction against petitioners alleging that petitioners cannot enforce the judgment against conjugal partnership levied on the ground that the subject loan did not redound to the benefit of the said conjugal partnership. Upon application of private respondents, the lower court issued a temporary restraining order to prevent Magsajo from proceeding with the enforcement of the writ of execution and with the sale of the said properties at public auction.
ISSUE :
Whether or not loan acquired by PBM from Ayala Investments as guaranteed by Alfredo Ching be redounded to the conjugal partnership of the spouses.
RULING :
The husband and the wife can engage in any lawful enterprise or profession. While it is but natural for the husband and the wife to consult each other, the law does not make it a requirement that a spouse has to get the prior consent of the other before entering into any legitimate profession, occupation, business or activity. The exercise by a spouse of a legitimate profession, occupation, business or activity is always considered to redound to the benefit of the family. But an isolated transaction of a spouse such as being guarantor for a third person’s debt is not per se considered as redounding to the benefit of the family. Based from the foregoing jurisprudential rulings of the court, “if the money or services are given to another person or entity, and the husband acted only as a surety orguarantor, that contract cannot, by itself, alone