Вы находитесь на странице: 1из 24

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

690Phil.220

SECONDDIVISION

[G.R.No176556,July04,2012]

BRIGIDOB.QUIAO,PETITIONER,VS.RITAC.QUIAO,

KITCHIEC.QUIAO,LOTISC.QUIAO,PETCHIEC.QUIAO,

REPRESENTEDBYTHEIRMOTHERRITAQUIAO,

RESPONDENTS.

REYES,J.:

DECISION

Thefamilyisthebasicandthemostimportantinstitutionofsociety. Itisinthe familywherechildrenarebornandmoldedeithertobecomeusefulcitizensof thecountryortroublemakersinthecommunity. Thus,wearesaddenedwhen parents have to separate and fight over properties, without regard to the messagetheysendtotheirchildren. Notwithstandingthis,wemustnotshirk fromourobligationtoruleonthiscaseinvolvinglegalseparationescalatingto questionsondissolutionandpartitionofproperties.

TheCase

ThiscasecomesbeforeusviaPetitionforReviewonCertiorari [1] underRule45 oftheRulesofCourt. Thepetitionerseeksthatwevacateandsetasidethe

Order [2] datedJanuary 8,2007ofthe RegionalTrialCourt (RTC),Branch1, ButuanCity. Inlieuofthe saidorder,we are askedto issue a Resolution definingthenetprofitssubjectoftheforfeitureasaresultofthedecreeoflegal separation in accordance with the provision of Article 102(4) of the Family

Code,oralternatively,inaccordancewiththeprovisionsofArticle176ofthe

CivilCode.

AntecedentFacts

OnOctober26,2000,hereinrespondentRitaC.Quiao(Rita)filedacomplaint

for legal separation against herein petitioner Brigido B. Quiao (Brigido). [3]

Subsequently, the RTC rendered a Decision [4] dated October 10, 2005, the dispositiveportionofwhichprovides:

WHEREFORE,viewedfromtheforegoingconsiderations,judgmentis

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

hereby rendered declaring the legal separation of plaintiff Rita C. Quiaoanddefendant­respondentBrigidoB.QuiaopursuanttoArticle

55.

Assuch,thehereinpartiesshallbeentitledtoliveseparatelyfrom

eachother,butthemarriagebondshallnotbesevered.

Except forLetecia C.Quiao who is of legal age,the three minor children,namely,Kitchie,LotisandPetchie,allsurnamedQuiaoshall remainunderthecustodyoftheplaintiffwhoistheinnocentspouse.

Further, except for the personal and real properties already foreclosedbytheRCBC,alltheremainingproperties,namely:

1.coffeemillinBalongagan,LasNieves,AgusandelNorte;

2.coffeemillinDurian,LasNieves,AgusandelNorte;

3.cornmillinCasiklan,LasNieves,AgusandelNorte;

4.coffeemillinEsperanza,AgusandelSur;

5.aparceloflandwithanareaof1,200squaremeterslocatedin

Tungao,ButuanCity;

6.aparcelofagriculturallandwithanareaof5hectareslocated

inManiladeBugabos,ButuanCity;

7.aparceloflandwithanareaof84squaremeterslocatedin

Tungao,ButuanCity;

8.BashierBonFactorylocatedinTungao,ButuanCity;

shall be divided equally between herein [respondents] and [petitioner]subjecttotherespectivelegitimesofthechildrenand

thepaymentoftheunpaidconjugalliabilitiesof[P]45,740.00.

[Petitioner’s] share, however, of the net profits earned by the conjugalpartnershipisforfeitedinfavorofthecommonchildren.

He is further ordered to reimburse [respondents] the sum of [P]19,000.00 as attorney's fees and litigation expenses of

[P]5,000.00[.]

SOORDERED. [5]

Neitherpartyfiledamotionforreconsiderationandappealwithintheperiod

providedforunderSection17(a)and(b)oftheRuleonLegalSeparation. [6]

OnDecember12,2005,therespondentsfiledamotionforexecution [7] which

thetrialcourtgrantedinitsOrderdatedDecember16,2005,thedispositive

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

portionofwhichreads:

“Wherefore,findingthemotiontobewelltaken,thesameishereby granted. Let a writ of execution be issued for the immediate enforcementoftheJudgment.

SOORDERED.” [8]

Subsequently, on February 10, 2006, the RTC issued a Writ of Execution [9] whichreadsasfollows:

NOWTHEREFORE,thatofthegoodsandchattelsofthe[petitioner]

BRIGIDOB.QUIAOyoucausetobemadethesumsstatedinthe

afore­quotedDECISION[sic],togetherwithyourlawfulfeesinthe

serviceofthisWrit,allinthePhilippineCurrency.

Butifsufficientpersonalpropertycannotbefoundwhereoftosatisfy thisexecutionandyourlawfulfees,thenwecommandyouthatof thelandsandbuildingsofthesaid[petitioner],youmakethesaid sumsinthemannerrequiredbylaw. Youareenjoinedtostrictly

observedSection9,Rule39,Rule[sic]ofthe1997RulesofCivil

Procedure.

Youareherebyorderedtomakeareturnofthesaidproceedings immediatelyafterthejudgmenthasbeensatisfiedinpartorinfullin consonance with Section 14, Rule 39 of the 1997 Rules of Civil

Procedure,asamended. [10]

OnJuly6,2006,thewritwaspartiallyexecutedwiththepetitionerpayingthe

respondentstheamountofP46,870.00,representingthefollowingpayments:

(a) P22,870.00–as petitioner's share ofthe payment ofthe conjugal share;

(b)P19,000.00–asattorney'sfees;and

(c)P5,000.00–aslitigationexpenses. [11]

OnJuly7,2006,oraftermorethanninemonthsfromthepromulgationofthe

Decision,thepetitionerfiledbeforetheRTCaMotionforClarification, [12] asking theRTCtodefinetheterm“NetProfitsEarned.”

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

Toresolvethepetitioner'sMotionforClarification,theRTCissuedanOrder [13] dated August 31, 2006, which held that the phrase “NET PROFIT EARNED” denotes “the remainderofthe properties ofthe parties afterdeducting the

separate properties ofeach[ofthe] spouse andthe debts.” [14] The Order furtherheldthatafterdeterminingtheremainderoftheproperties,itshallbe forfeitedinfavorofthecommonchildrenbecausetheoffendingspousedoes nothaveanyrighttoanyshareofthenetprofitsearned,pursuanttoArticles

63,No.(2)and43,No.(2)oftheFamilyCode. [15] Thedispositiveportionof theOrderstates:

WHEREFORE,thereisnoblatantdisparitywhenthesheriffintendsto

forfeitalltheremainingpropertiesafterdeductingthepaymentsof

thedebtsforonlyseparatepropertiesofthedefendant­respondent

shallbedeliveredtohimwhichhehasnone.

TheSheriffishereindirectedtoproceedwiththeexecutionofthe

Decision.

ITISSOORDERED. [16]

Not satisfied with the trial court's Order, the petitioner filed a Motion for

Reconsideration [17] on September 8, 2006. Consequently, the RTC issued

anotherOrder [18] datedNovember8,2006,holdingthatalthoughtheDecision

datedOctober10,2005hasbecomefinalandexecutory,itmaystillconsider

theMotionforClarificationbecausethepetitionersimplywantedtoclarifythe

meaningof“netprofitearned.” [19] Furthermore,thesameOrderheld:

ALLTOLD,theCourtOrderdatedAugust31,2006isherebyordered

setaside.NETPROFITEARNED,whichissubjectofforfeitureinfavor of [the] parties' common children, is ordered to be computed in

accordance[with]par.4ofArticle102oftheFamilyCode. [20]

OnNovember21,2006,therespondentsfiledaMotionforReconsideration, [21]

prayingforthecorrectionandreversaloftheOrderdatedNovember8,2006.

Thereafter,onJanuary8,2007, [22] thetrialcourthadchangeditsrulingagain andgrantedthe respondents'MotionforReconsiderationwhereby the Order

datedNovember8,2006wassetasidetoreinstatetheOrderdatedAugust31,

2006.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

Notsatisfiedwiththetrialcourt'sOrder,thepetitionerfiledonFebruary27,

2007thisinstantPetitionforReviewunderRule45oftheRulesofCourt,raising

thefollowing:

Issues

I

ISTHEDISSOLUTIONANDTHECONSEQUENTLIQUIDATIONOF THE COMMONPROPERTIESOFTHE HUSBAND AND WIFE BY VIRTUEOFTHEDECREEOFLEGALSEPARATIONGOVERNEDBY

ARTICLE125(SIC)OFTHEFAMILYCODE?

II

WHATISTHEMEANINGOFTHENETPROFITSEARNEDBYTHE CONJUGALPARTNERSHIPFORPURPOSESOFEFFECTINGTHE

FORFEITUREAUTHORIZEDUNDERARTICLE63OFTHEFAMILY

CODE?

III

WHAT LAW GOVERNS THE PROPERTY RELATIONS BETWEEN THEHUSBANDANDWIFEWHOGOTMARRIEDIN1977? CAN THE FAMILY CODE OF THE PHILIPPINES BE GIVEN RETROACTIVEEFFECTFORPURPOSESOFDETERMINING THE NETPROFITSSUBJECTOFFORFEITUREASARESULTOFTHE DECREEOFLEGALSEPARATIONWITHOUTIMPAIRINGVESTED RIGHTSALREADYACQUIREDUNDERTHECIVILCODE?

IV

WHATPROPERTIESSHALLBEINCLUDEDINTHEFORFEITURE

OFTHESHAREOFTHEGUILTYSPOUSEINTHENETCONJUGAL

PARTNERSHIPASARESULTOFTHEISSUANCEOFTHEDECREE

OFLEGALSEPARATION? [23]

OurRuling

Whilethepetitionerhasraisedanumberofissuesontheapplicabilityofcertain laws,wearewell­awarethattherespondentshavecalledourattentiontothe

factthattheDecisiondatedOctober10,2005hasattainedfinalitywhenthe

MotionforClarificationwasfiled. [24] Thus,weareconstrainedtoresolvefirst the issue of the finality of the Decision dated October 10, 2005 and

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

subsequentlydiscussthemattersthatwecanclarify.

TheDecisiondatedOctober10,2005hasbecomefinalandexecutoryat

thetimetheMotionforClarificationwasfiledonJuly7,2006.

Section3,Rule41oftheRulesofCourtprovides:

Section3.Periodofordinary appeal.­ The appealshallbe taken

withinfifteen(15)daysfromnoticeofthejudgmentorfinalorder

appealedfrom. Wherearecordonappealisrequired,theappellant

shallfileanoticeofappealandarecordonappealwithinthirty(30)

daysfromnoticeofthejudgmentorfinalorder.

Theperiodofappealshallbeinterruptedbyatimelymotionfornew trialorreconsideration. Nomotionforextensionoftimetofilea motionfornewtrialorreconsiderationshallbeallowed.

InNeypesv.CourtofAppeals, [25] weclarifiedthattostandardizetheappeal periodsprovidedintheRulesandtoaffordlitigantsfairopportunitytoappeal

theircases,weheldthat“itwouldbepracticaltoallowafreshperiodof15

dayswithinwhichtofilethenoticeofappealintheRTC,countedfromreceipt of the order dismissing a motion for a new trial or motion for

reconsideration.” [26]

InNeypes,weexplainedthatthe"freshperiodrule"shallalsoapplytoRule40

governing appeals from the Municipal Trial Courts to the RTCs; Rule 42 on

petitionsforreviewfromtheRTCstotheCourtofAppeals(CA);Rule43on

appealsfromquasi­judicialagenciestotheCAandRule45governingappeals

by certiorari to the Supreme Court. We also said, “The new rule aims to regimentormaketheappealperioduniform,tobecountedfromreceiptofthe orderdenyingthemotionfornewtrial,motionforreconsideration(whetherfull

orpartial)oranyfinalorderorresolution.” [27] Inotherwords,apartylitigant

mayfilehisnoticeofappealwithinafresh15­dayperiodfromhisreceiptofthe

trialcourt'sdecisionorfinalorderdenyinghismotionfornewtrialormotionfor reconsideration. Failuretoavailofthefresh15­dayperiodfromthedenialof themotionforreconsiderationmakes thedecisionorfinalorderinquestion finalandexecutory.

Inthecaseatbar,thetrialcourtrendereditsDecisiononOctober10,2005.

Thepetitionerneitherfiledamotionforreconsiderationnoranoticeofappeal.

OnDecember16,2005,orafter67dayshadlapsed,thetrialcourtissuedan

order granting the respondent's motion for execution; and on February 10,

2006,orafter123dayshadlapsed,thetrialcourtissuedawritofexecution.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

Finally,whenthewrithadalreadybeenpartiallyexecuted,thepetitioner,on

July7,2006orafter270dayshadlapsed,filedhisMotionforClarificationon

thedefinitionofthe“netprofitsearned.” Fromtheforegoing,thepetitionerhad clearly slept on his right to question the RTC’s Decision dated October 10, 2005. For270days,thepetitionerneverraisedasingleissueuntilthedecision hadalreadybeenpartiallyexecuted. Thusatthetimethepetitionerfiledhis motion for clarification, the trial court’s decision has become final and executory. Ajudgmentbecomesfinalandexecutorywhenthereglementary period to appeal lapses and no appeal is perfected within such period. Consequently,nocourt,noteventhisCourt,canarrogateuntoitselfappellate

jurisdictiontoreviewacaseormodifyajudgmentthatbecamefinal. [28]

Thepetitionerarguesthatthedecisionheisquestioningisavoidjudgment.

Beingsuch,thepetitioner'sthesisisthatitcanstillbedisturbedevenafter270

dayshadlapsedfromtheissuanceofthedecisiontothefilingofthemotionfor clarification. Hesaidthat“avoidjudgmentisnojudgmentatall. Itnever

attainsfinalityandcannotbeasourceofanyrightnoranyobligation.” [29] But whatpreciselyisavoidjudgmentinourjurisdiction? Whendoesajudgment becomesvoid?

“Ajudgmentisnullandvoidwhenthecourtwhichrenderedithadnopowerto

grantthereliefornojurisdictionoverthesubjectmatteroroverthepartiesor

both.” [30] Inotherwords,acourt,whichdoesnothavethepowertodecidea caseorthathasnojurisdictionoverthesubjectmatterortheparties,willissue

avoidjudgmentoracoramnonjudice. [31]

Thequestionedjudgmentdoesnotfallwithinthepurviewofavoidjudgment. Forsure,thetrialcourthasjurisdictionoveracaseinvolvinglegalseparation.

RepublicAct(R.A.)No.8369confersuponanRTC,designatedastheFamily

Courtofacity,theexclusiveoriginaljurisdictiontohearanddecide,among

others,complaintsorpetitionsrelatingtomaritalstatusandpropertyrelations

of the husband and wife or those living together. [32] The Rule on Legal

Separation [33] providesthat“thepetition[forlegalseparation]shallbefiledin theFamilyCourtoftheprovinceorcitywherethepetitionerortherespondent hasbeenresidingforatleastsixmonthspriortothedateoffilingorinthecase ofanon­residentrespondent,wherehemaybefoundinthePhilippines,atthe

electionofthepetitioner.” [34] Intheinstantcase,hereinrespondentRitais foundtoresideinTungao,ButuanCityformorethansixmonthspriortothe dateoffilingofthepetition;thus,theRTC,clearlyhasjurisdictionoverthe respondent'spetitionbelow. Furthermore,theRTCalsoacquiredjurisdiction overthepersonsofbothparties,consideringthatsummonsandacopyofthe complaint with its annexes were served upon the herein petitioner on December 14, 2000 and that the herein petitioner filed his Answer to the

ComplaintonJanuary9,2001. [35] Thus,withoutdoubt,theRTC,whichhas

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

renderedthequestionedjudgment,hasjurisdictionoverthecomplaintandthe

personsoftheparties.

Fromtheaforecitedfacts,thequestionedOctober10,2005judgmentofthe

trialcourtisclearlynotvoidabinitio,sinceitwasrenderedwithintheambitof thecourt'sjurisdiction. Beingsuch,thesamecannotanymorebedisturbed, even if the modification is meant to correct what may be considered an

erroneousconclusionoffactorlaw. [36] Infact,wehaveruledthatfor“[as] longasthepublicrespondentactedwithjurisdiction,anyerrorcommittedby himoritintheexercisethereofwillamounttonothingmorethananerrorof

judgmentwhichmaybereviewedorcorrectedonlybyappeal.” [37] Granting without admitting that the RTC's judgment dated October 10, 2005 was erroneous, the petitioner's remedy should be an appeal filed within the reglementaryperiod. Unfortunately,thepetitionerfailedtodothis. Hehas alreadylostthechancetoquestionthetrialcourt'sdecision,whichhasbecome immutableandunalterable. Whatwecanonlydoistoclarifytheveryquestion raisedbelowandnothingmore.

Forourconvenience,thefollowingmatterscannotanymorebedisturbedsince

theOctober10,2005judgmenthasalreadybecomeimmutableandunalterable,

towit:

(a)Thefindingthatthepetitioneristheoffendingspousesincehecohabited

withawomanwhoisnothiswife; [38]

(b)Thetrialcourt'sgrantofthepetitionforlegalseparationofrespondentRita;

[39]

(c)Thedissolutionandliquidationoftheconjugalpartnership; [40]

(d)Theforfeitureofthepetitioner'srighttoanyshareofthenetprofitsearned

bytheconjugalpartnership; [41]

(e)Theawardtotheinnocentspouseoftheminorchildren'scustody; [42]

(f) The disqualification of the offending spouse from inheriting from the

innocentspousebyintestatesuccession; [43]

(g)Therevocationofprovisionsinfavoroftheoffendingspousemadeinthe

willoftheinnocentspouse; [44]

(h)Theholdingthatthepropertyrelationofthepartiesisconjugalpartnership

ofgainsandpursuanttoArticle116oftheFamilyCode,allpropertiesacquired

duringthemarriage,whetheracquiredbyoneorbothspouses,ispresumedto

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

beconjugalunlessthecontraryisproved; [45]

(i) The finding that the spouses acquired theirreal and personal properties

whiletheywerelivingtogether; [46]

(j)ThelistofpropertieswhichRizalCommercialBankingCorporation(RCBC)

foreclosed; [47]

(k)Thelistoftheremainingpropertiesofthecouplewhichmustbedissolved

andliquidatedandthefactthatrespondentRitawastheonewhotookcharge

oftheadministrationoftheseproperties; [48]

(l)Theholdingthattheconjugalpartnershipshallbeliabletomattersincluded

under Article 121 of the Family Code and the conjugal liabilities totaling

P503,862.10shallbechargedtotheincomegeneratedbytheseproperties; [49]

(m)Thefactthatthetrialcourthadnowayofknowingwhetherthepetitioner

had separate properties which can satisfy his share for the support of the

family; [50]

(n)TheholdingthattheapplicablelawinthiscaseisArticle129(7); [51]

(o)Therulingthattheremainingpropertiesnotsubjecttoanyencumbrance

shallthereforebedividedequallybetweenthepetitionerandtherespondent

withoutprejudicetothechildren'slegitime; [52]

(p) The holdingthat the petitioner's share ofthe net profits earnedby the

conjugalpartnershipisforfeitedinfavorofthecommonchildren; [53] and

(q) The order to the petitioner to reimburse the respondents the sum of

P19,000.00asattorney'sfeesandlitigationexpensesofP5,000.00. [54]

AfterdiscussinglengthilytheimmutabilityoftheDecisiondatedOctober10,

2005,wewilldiscussthefollowingissuesfortheenlightenmentoftheparties

andthepublicatlarge.

Article129oftheFamilyCodeappliestothepresent

casesincetheparties'propertyrelationisgoverned

bythesystemofrelativecommunityorconjugal

partnershipofgains.

ThepetitionerclaimsthatthecourtaquoiswrongwhenitappliedArticle129

oftheFamilyCode,insteadofArticle102. HeconfusinglyarguesthatArticle

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

102appliesbecausethereisnootherprovisionundertheFamilyCodewhich

definesnetprofitsearnedsubjectofforfeitureasaresultoflegalseparation.

Offhand, the trial court's Decision dated October 10, 2005 held that Article 129(7)oftheFamilyCodeappliesinthiscase. Weagreewiththetrialcourt's holding.

First,letusdeterminewhatgovernsthecouple'spropertyrelation. Fromthe record,wecandeducethatthepetitionerandtherespondenttiedthemarital knotonJanuary6,1977. Sinceatthetimeoftheexchangeofmaritalvows,

theoperativelawwastheCivilCodeofthePhilippines(R.A.No.386)andsince

theydidnotagreeonamarriagesettlement,thepropertyrelationsbetween the petitioner and the respondent is the system of relative community or

conjugalpartnershipofgains. [55] Article119oftheCivilCodeprovides:

Art.119.Thefuturespousesmayinthemarriagesettlementsagree

uponabsoluteorrelativecommunityofproperty,oruponcomplete separationofproperty,oruponanyotherregime. Intheabsenceof marriage settlements,orwhenthe same are void,the systemof relativecommunityorconjugalpartnershipofgainsasestablishedin thisCode,shallgovernthepropertyrelationsbetweenhusbandand wife.

Thus, from the foregoing facts and law, it is clear that what governs the property relations of the petitioner and of the respondent is conjugal partnershipofgains. Andunderthispropertyrelation,“thehusbandandthe wife place in a common fund the fruits of their separate property and the

incomefromtheirwork orindustry.” [56] Thehusbandandwifealsoownin

commonallthepropertyoftheconjugalpartnershipofgains. [57]

Second, since at the time of the dissolution of the petitioner and the respondent'smarriagetheoperativelawisalreadytheFamilyCode,thesame appliesintheinstantcaseandtheapplicablelawinsofarastheliquidationof

theconjugalpartnershipassetsandliabilitiesisconcernedisArticle129ofthe

FamilyCodeinrelationtoArticle63(2)oftheFamilyCode. Thelatterprovision

isapplicablebecauseaccordingtoArticle256oftheFamilyCode“[t]hisCode

shallhaveretroactiveeffectinsofarasitdoesnotprejudiceorimpairvestedor

acquiredrightsinaccordancewiththeCivilCodeorotherlaw.” [58]

Now, the petitioner asks: Was his vested right over half of the common properties ofthe conjugalpartnershipviolatedwhenthe trialcourtforfeited

theminfavorofhischildrenpursuanttoArticles63(2)and129oftheFamily

Code?

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

Werespondinthenegative.

Indeed, the petitioner claims that his vested rights have been impaired, arguing:“Asearlieradvertedto,thepetitioneracquiredvestedrightsoverhalf oftheconjugalproperties,thesamebeingownedincommonbythespouses. IftheprovisionsoftheFamilyCodearetobegivenretroactiveapplicationto the point of authorizing the forfeiture of the petitioner's share in the net remainderoftheconjugalpartnershipproperties,thesameimpairshisrights

acquiredpriortotheeffectivityoftheFamilyCode.” [59] Inotherwords,the petitionerissayingthatsincethepropertyrelationsbetweenthespousesis governedbytheregimeofConjugalPartnershipofGainsundertheCivilCode, thepetitioneracquiredvestedrightsoverhalfofthepropertiesoftheConjugal

PartnershipofGains,pursuanttoArticle143oftheCivilCode,whichprovides:

“Allpropertyoftheconjugalpartnershipofgainsisownedincommonbythe

husbandandwife.” [60] Thus,sinceheisoneoftheownersoftheproperties coveredbytheconjugalpartnershipofgains,hehasavestedrightoverhalfof thesaidproperties,evenafterthepromulgationoftheFamilyCode;andhe insistedthatnoprovisionundertheFamilyCodemaydeprivehimofthisvested right by virtue ofArticle 256ofthe Family Code whichprohibits retroactive applicationoftheFamilyCodewhenitwillprejudiceaperson'svestedright.

However,thepetitioner'sclaimofvestedrightisnotonewhichiswrittenon

stone. InGo,Jr.v.CourtofAppeals, [61] wedefineandexplained“vestedright” inthefollowingmanner:

Avestedrightisonewhoseexistence,effectivityandextentdonot depend upon events foreign to the will of the holder, or to the exerciseofwhichnoobstacleexists,andwhichisimmediateand perfectinitselfandnotdependentuponacontingency. Theterm “vestedright”expressestheconceptofpresentfixedinterestwhich, in right reason and natural justice, should be protected against arbitraryStateaction,oraninnatelyjustandimperativerightwhich enlightened free society, sensitive to inherent and irrefragable individualrights,cannotdeny.

Tobevested,arightmusthavebecomeatitle—legalorequitable—

to the present or future enjoyment of property. [62] (Citations omitted)

InourenbancResolutiondatedOctober18,2005forABAKADAGuroPartyList

OfficerSamsonS.Alcantara,etal.v.TheHon.ExecutiveSecretaryEduardoR.

Ermita, [63] wealsoexplained:

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

The concept of “vested right” is a consequence of the constitutionalguarantyofdueprocessthatexpressesapresent fixedinterestwhichinrightreasonandnaturaljusticeisprotected againstarbitrarystateaction;itincludesnotonlylegalorequitable titletotheenforcementofademandbutalsoexemptionsfromnew obligationscreatedaftertherighthasbecomevested. Rightsare consideredvestedwhentherighttoenjoymentisapresentinterest,

absolute, unconditional, and perfect or fixed and irrefutable. [64] (Emphasisandunderscoringsupplied)

Fromtheforegoing,itisclearthatwhileonemaynotbedeprivedofhis“vested

right,”hemaylosethesameifthereisdueprocessandsuchdeprivationis

foundedinlawandjurisprudence.

Inthepresentcase,thepetitionerwasaccordedhisrighttodueprocess. First, hewaswell­awarethattherespondentprayedinhercomplaintthatallofthe

conjugalpropertiesbeawardedtoher. [65] Infact,inhisAnswer,thepetitioner prayedthatthetrialcourtdividethecommunityassetsbetweenthepetitioner and the respondent as circumstances and evidence warrant after the

accountingandinventoryofallthecommunitypropertiesoftheparties. [66] Second, when the Decision dated October 10, 2005 was promulgated, the petitionerneverquestionedthetrialcourt'srulingforfeitingwhatthetrialcourt

termed as “net profits,” pursuant to Article 129(7) of the Family Code. [67] Thus,thepetitionercannotclaimbeingdeprivedofhisrighttodueprocess.

Furthermore, we take note that the alleged deprivation of the petitioner's “vestedright”isonefounded,notonlyintheprovisionsoftheFamilyCode,but inArticle176oftheCivilCode. ThisprovisionislikeArticles63and129ofthe Family Code on the forfeiture of the guilty spouse's share in the conjugal partnershipprofits. Thesaidprovisionsays:

Art.176. Incaseoflegalseparation,theguiltyspouseshallforfeit hisorhershareoftheconjugalpartnershipprofits,whichshallbe awardedtothechildrenofboth,andthechildrenoftheguiltyspouse had by a prior marriage. However, if the conjugal partnership propertycamemostlyorentirelyfromtheworkorindustry,orfrom thewagesandsalaries,orfromthefruitsoftheseparatepropertyof theguiltyspouse,thisforfeitureshallnotapply.

Incasetherearenochildren,theinnocentspouseshallbeentitled

toallthenetprofits.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

From the foregoing, the petitioner's claim of a vested right has no basis considering that even under Article 176 of the Civil Code, his share of the conjugalpartnershipprofitsmaybeforfeitedifheistheguiltypartyinalegal separationcase. Thus,aftertrialandafterthepetitionerwasgiventhechance topresenthisevidence,thepetitioner'svestedrightclaimmayinfactbeset asideundertheCivilCodesincethetrialcourtfoundhimtheguiltyparty.

More, in Abalos v. Dr. Macatangay, Jr., [68] we reiterated our long­standing rulingthat:

[P]riortotheliquidationoftheconjugalpartnership,theinterestof eachspouseintheconjugalassetsisinchoate,amereexpectancy, whichconstitutesneitheralegalnoranequitableestate,anddoes not ripen into title until it appears that there are assets in the community as a result of the liquidation and settlement. The interest of each spouse is limited to the net remainder or “remanenteliquido”(haberganancial)resultingfromtheliquidation oftheaffairsofthepartnershipafteritsdissolution. Thus,theright ofthehusbandorwifetoone­halfoftheconjugalassetsdoesnot vestuntilthedissolutionandliquidationoftheconjugalpartnership, orafterdissolutionofthe marriage,whenit is finally determined that,aftersettlementofconjugalobligations,therearenetassets leftwhichcanbedividedbetweenthespousesortheirrespective

heirs. [69] (Citationsomitted)

Finally,asearlierdiscussed,thetrialcourthasalreadydecidedinitsDecision

datedOctober10,2005thattheapplicablelawinthiscaseisArticle129(7)of

theFamilyCode. [70] Thepetitionerdidnotfileamotionforreconsiderationnor anoticeofappeal.Thus,thepetitionerisnowprecludedfromquestioningthe trialcourt'sdecisionsinceithasbecomefinalandexecutory.Thedoctrineof immutabilityandunalterabilityofafinaljudgmentpreventsusfromdisturbing

theDecisiondatedOctober10,2005becausefinalandexecutorydecisionscan

nolongerbereviewednorreversedbythisCourt. [71]

Fromtheabovediscussions,Article129oftheFamilyCodeclearlyappliesto

thepresentcasesincetheparties'propertyrelationisgovernedbythesystem of relative community or conjugal partnership of gains and since the trial court'sDecisionhasattainedfinalityandimmutability.

Thenetprofitsoftheconjugalpartnershipofgainsareallthefruitsof

theseparatepropertiesofthespousesandtheproductsoftheirlabor

andindustry.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

The petitioner inquires from us the meaning of “net profits” earned by the conjugalpartnershipforpurposesofeffectingtheforfeitureauthorizedunder Article63oftheFamilyCode. Heinsiststhatsincethereisnootherprovision undertheFamilyCode,whichdefines“netprofits”earnedsubjectofforfeiture

asaresultoflegalseparation,thenArticle102oftheFamilyCodeapplies.

Whatdoes Article102oftheFamilyCodesay? Is thecomputationof“net profits” earned in the conjugal partnership of gains the same with the computationof“netprofits”earnedintheabsolutecommunity?

Now,weclarify.

Firstandforemost,wemustdistinguishbetweentheapplicablelawastothe property relations between the parties and the applicable law as to the

definitionof“netprofits.”Asearlierdiscussed,Article129oftheFamilyCode

applies as to the property relations of the parties. In other words, the computation and the succession of events will follow the provisions under

Article129ofthesaidCode.Moreover,astothedefinitionof“netprofits,”we

cannot but refer to Article 102(4) of the Family Code, since it expressly provides thatforpurposes ofcomputingthenetprofits subjecttoforfeiture

underArticle43,No.(2)andArticle63,No.(2),Article102(4)applies.Inthis

provision,netprofits“shallbetheincreaseinvaluebetweenthemarketvalue

ofthecommunitypropertyatthetimeofthecelebrationofthemarriageand

themarketvalueatthetimeofitsdissolution.” [72] Thus,withoutanyiotaof

doubt,Article102(4)appliestoboththedissolutionoftheabsolutecommunity

regime under Article 102 of the Family Code,and to the dissolution of the

conjugalpartnershipregimeunderArticle129oftheFamilyCode.Wherelies

thedifference?Asearliershown,thedifferenceliesintheprocessesusedunder the dissolution of the absolute community regime under Article 102 of the FamilyCode,andintheprocessesusedunderthedissolutionoftheconjugal

partnershipregimeunderArticle129oftheFamilyCode.

Let us now discuss the difference in the processes between the absolute communityregimeandtheconjugalpartnershipregime.

OnAbsoluteCommunityRegime:

Whenacoupleentersintoaregimeofabsolutecommunity,thehusbandand thewifebecomesjointownersofallthepropertiesofthemarriage.Whatever propertyeachspousebringsintothemarriage,andthoseacquiredduringthe

marriage(exceptthoseexcludedunderArticle92oftheFamilyCode)formthe

commonmassofthecouple'sproperties.Andwhenthecouple'smarriageor

communityisdissolved,thatcommonmassisdividedbetweenthespouses,or

theirrespectiveheirs,equallyorintheproportionthepartieshaveestablished,

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

irrespectiveofthevalueeachonemayhaveoriginallyowned. [73]

Under Article 102 of the Family Code, upon dissolution of marriage, an inventory is prepared, listing separately all the properties of the absolute communityandtheexclusivepropertiesofeach;thenthedebtsandobligations oftheabsolutecommunityarepaidoutoftheabsolutecommunity'sassetsand ifthecommunity'spropertiesareinsufficient,theseparatepropertiesofeachof thecouplewillbesolidarilyliablefortheunpaidbalance.Whateverisleftofthe separatepropertieswillbedeliveredtoeachofthem.Thenetremainderofthe absolute community is its net assets, which shall be divided between the husbandandthewife;andforpurposesofcomputingthenetprofitssubjectto forfeiture,saidprofitsshallbetheincreaseinvaluebetweenthemarketvalue ofthecommunitypropertyatthetimeofthecelebrationofthemarriageand

themarketvalueatthetimeofitsdissolution. [74]

ApplyingArticle102oftheFamilyCode,the“netprofits”requiresthatwefirst

find the market value of the properties at the time of the community's dissolution. Fromthe totality ofthe marketvalue ofallthe properties,we subtractthedebtsandobligationsoftheabsolutecommunityandthisresultto thenetassetsornetremainderofthepropertiesoftheabsolutecommunity, from which we deduct the market value of the properties at the time of

marriage,whichthenresultstothenetprofits. [75]

GrantingwithoutadmittingthatArticle102appliestotheinstantcase,letus

seewhatwillhappenifweapplyArticle102:

(a)Accordingtothetrialcourt'sfindingoffacts,bothhusbandandwifehaveno separateproperties,thus,theremainingpropertiesinthelistaboveareallpart oftheabsolutecommunity. Anditsmarketvalueatthetimeofthedissolution oftheabsolutecommunityconstitutesthe“marketvalueatdissolution.”

(b)Thus,whenthepetitionerandtherespondentfinallywerelegallyseparated, allthepropertieswhichremainedwillbeliableforthedebtsandobligationsof thecommunity. Suchdebtsandobligationswillbesubtractedfromthe“market valueatdissolution.”

(c)Whatremainsafterthedebtsandobligationshavebeenpaidfromthetotal assetsoftheabsolutecommunityconstitutesthenetremainderornetasset. And from such net asset/remainder of the petitioner and respondent's remaining properties, the market value at the time of marriage will be subtractedandtheresultingtotalityconstitutesthe“netprofits.”

(d) Since both husband and wife have no separate properties, and nothing would be returned to each of them, what will be divided equally between them is simply the “net profits.” However, in the Decision dated

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

October10,2005,thetrialcourtforfeitedthehalf­shareofthepetitionerin

favorofhischildren. Thus,ifweuseArticle102intheinstantcase(which shouldnot be the case),nothingis left to the petitionersince bothparties enteredintotheirmarriagewithoutbringingwiththemanyproperty.

OnConjugalPartnershipRegime:

Before we go into our disquisition on the Conjugal Partnership Regime, we

makeitclearthatArticle102(4)oftheFamilyCodeappliesintheinstantcase

for purposes only of defining “net profit.” As earlier explained, the

definitionof“netprofits”inArticle102(4)oftheFamilyCodeappliestoboth

theabsolutecommunityregimeandconjugalpartnershipregimeasprovided

forunderArticle63,No.(2)oftheFamilyCode,relativetotheprovisionson

LegalSeparation.

Now,whenacoupleentersintoaregimeofconjugalpartnershipofgains

underArticle142oftheCivilCode,“thehusbandandthewifeplaceincommon

fund the fruits of their separate property and income from their work or industry,and divide equally,upon the dissolution of the marriage orof the partnership,thenetgainsorbenefitsobtainedindiscriminatelybyeitherspouse

duringthemarriage.” [76] Fromtheforegoingprovision,eachofthecouplehas his and her own property and debts. The law does not intend to effect a mixtureormergerofthosedebtsorpropertiesbetweenthespouses. Rather,it

establishesacompleteseparationofcapitals. [77]

Consideringthatthecouple's marriagehas beendissolvedundertheFamily

Code,Article129ofthesameCodeappliesintheliquidationofthecouple's

propertiesintheeventthattheconjugalpartnershipofgainsisdissolved,to

wit:

Art.129.Uponthedissolutionoftheconjugalpartnershipregime,

thefollowingprocedureshallapply:

(1) An inventory shall be prepared, listing separately all the propertiesoftheconjugalpartnershipandtheexclusivepropertiesof eachspouse.

(2) Amounts advancedby the conjugalpartnershipinpaymentof personaldebtsandobligationsofeitherspouseshallbecreditedto theconjugalpartnershipasanassetthereof.

(3) Each spouse shall be reimbursed for the use of his or her exclusivefundsintheacquisitionofpropertyorforthevalueofhis orherexclusiveproperty,theownershipofwhichhasbeenvested

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

bylawintheconjugalpartnership.

(4)Thedebtsandobligationsoftheconjugalpartnershipshallbe

paid out of the conjugal assets. In case of insufficiency of said assets,thespousesshallbesolidarilyliablefortheunpaidbalance withtheirseparateproperties,inaccordancewiththeprovisionsof

paragraph(2)ofArticle121.

(5) Whatever remains of the exclusive properties of the spouses shallthereafterbedeliveredtoeachofthem.

(6)Unlesstheownerhadbeenindemnifiedfromwhateversource,

the loss or deterioration of movables used for the benefit of the family, belonging to either spouse, even due to fortuitous event, shallbepaidtosaidspousefromtheconjugalfunds,ifany.

(7)Thenetremainderoftheconjugalpartnershippropertiesshall

constitute the profits, which shall be divided equally between husband and wife, unless a different proportion or division was agreeduponinthemarriagesettlementsorunlesstherehasbeena voluntarywaiverorforfeitureofsuchshareasprovidedinthisCode.

(8) The presumptive legitimes of the common children shall be

delivereduponthepartitioninaccordancewithArticle51.

(9)Inthepartitionoftheproperties,theconjugaldwellingandthe

lotonwhichitissituatedshall,unlessotherwiseagreeduponbythe parties,beadjudicatedtothespousewithwhomthemajorityofthe commonchildrenchoosetoremain. Childrenbelowtheageofseven yearsaredeemedtohavechosenthemother,unlessthecourthas decidedotherwise. Incasethereisnosuchmajority,thecourtshall decide,takingintoconsiderationthebestinterestsofsaidchildren.

Inthenormalcourseofevents,thefollowingarethestepsintheliquidationof

thepropertiesofthespouses:

(a)Aninventoryofalltheactualpropertiesshallbemade,separatelylisting

the couple's conjugal properties and their separate properties. [78] In the instant case, the trial court found that the couple has no separate

properties when they married. [79] Rather, the trial court identified the followingconjugalproperties,towit:

1.coffeemillinBalongagan,LasNieves,AgusandelNorte;

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

2.coffeemillinDurian,LasNieves,AgusandelNorte;

3.cornmillinCasiklan,LasNieves,AgusandelNorte;

4.coffeemillinEsperanza,AgusandelSur;

5.aparceloflandwithanareaof1,200squaremeterslocatedin

Tungao,ButuanCity;

6.aparcelofagriculturallandwithanareaof5hectareslocatedin

ManiladeBugabos,ButuanCity;

7. a parcel of land with an area of 84 square meters located in Tungao,ButuanCity;

8.BashierBonFactorylocatedinTungao,ButuanCity. [80]

(b)Ordinarily,thebenefitreceivedbyaspousefromtheconjugalpartnership

duringthemarriageisreturnedinequalamounttotheassetsoftheconjugal

partnership; [81] and if the community is enriched at the expense of the separate properties of either spouse, a restitution of the value of such

propertiestotheirrespectiveownersshallbemade. [82]

(c)Subsequently,thecouple'sconjugalpartnershipshallpaythedebtsofthe conjugalpartnership; while the debts andobligationofeachofthe spouses shallbe paidfromtheirrespective separate properties. But ifthe conjugal partnershipisnotsufficienttopayallitsdebtsandobligations,thespouses

withtheirseparatepropertiesshallbesolidarilyliable. [83]

(d)Now,whatremainsoftheseparateorexclusivepropertiesofthehusband

andofthewifeshallbereturnedtoeachofthem. [84] Intheinstantcase, sinceitwasalreadyestablishedbythetrialcourtthatthespouseshave

noseparateproperties, [85] thereisnothingtoreturntoanyofthem. Thelistedpropertiesaboveareconsideredpartoftheconjugalpartnership. Thus,ordinarily,whatremainsintheabove­listedpropertiesshouldbedivided

equallybetweenthespousesand/ortheirrespectiveheirs. [86] However,since the trial court found the petitionerthe guilty party,his share from the net profitsoftheconjugalpartnershipisforfeitedinfavorofthecommonchildren, pursuanttoArticle63(2)oftheFamilyCode. Again,lestwebeconfused,likein theabsolutecommunityregime,nothingwillbereturnedtotheguiltypartyin the conjugal partnership regime, because there is no separate property whichmaybeaccountedforintheguiltyparty'sfavor.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

Inthediscussionsabove,wehaveseenthatinbothinstances,thepetitioneris notentitledtoanypropertyatall. Thus,wecannotbutupholdtheDecision datedOctober10,2005ofthetrialcourt. However,wemustclarify,aswe

alreadydidabove,theOrderdatedJanuary8,2007.

WHEREFORE,theDecisiondatedOctober10,2005oftheRegionalTrialCourt,

Branch1ofButuanCityisAFFIRMED. ActingontheMotionforClarification

datedJuly7,2006intheRegionalTrialCourt,theOrderdatedJanuary8,2007

oftheRegionalTrialCourtisherebyCLARIFIEDinaccordancewiththeabove

discussions.

SOORDERED.

Carpio,(Chairperson),Brion,Perez,andSereno,JJ.,concur.

[1] Rollo,pp.7­35.

[2] PennedbyJudgeEduardoS.Casals;id.at115­122.

[3] Id.at36.

[4] Id.at36­57.

[5] Id.at56­57.

[6] A.M.No.02­11­11­SC.

[7] Rollo,p.185.

[8] Id.at59.

[9] Id.at58­59.

[10] Id.at59.

[11] Id.at60.

[12] Id.at61­69.

[13] Id.at70­76.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

[14] Id.at75.

[15] Id.at74­75.

[16] Id.at75­76.

[17] Id.at77­86.

[18] Id.at87­91.

[19] Id.at90.

[20] Id.at91.

[21] Id.at92­97.

[22] Id.at115­122.

[23] Id.at18.

[24] Id.at143­146.

[25] 506Phil.613,629(2005).

[26] Id.at626.

[27] Id.at627.

[28] PCILeasingandFinance,Inc.,v. Milan,G.R.No.151215,April5,2010,617

SCRA258.

[29] Rollo,p.166.

[30] SeeMoreno,FedericoB.,PhilippineLawDictionary,3rded.,1988,p.998.

[31] Peoplev.JudgeNavarro,159Phil.863,874(1975).

[32] R.A.No.8369,Section5(d).

[33] A.M.No.02­11­11­SC.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

[34] Id.atSection2(c).

[35] Rollo,p.38.

[36] Sps.Edillov.Sps.Dulpina,G.R.No.188360,January21,2010,610SCRA

590,601­602.

[37] Limv.JudgeVianzon,529Phil.472,483­484(2006);SeealsoHerrerav.

BarrettoandJoaquin,25Phil.245,256(1913),citingMillerv.Rowan,251Ill.,

344.

[38] Rollo,pp.50­51.

[39] Id.at51.

[40] Id.

[41] Id.at51­52.

[42] Id.at52and56.

[43] Id.at52.

[44] Id.

[45] Id.

[46] Id.

[47] Id.at52­53.

[48] Id.at53.

[49] Id.at53­54.

[50] Id.at55.

[51] Id.

[52] Id.at56.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

[53] Id.at57.

[54] Id.

[55] CIVILCODEOFTHEPHILIPPINES,Art.119.

[56] Id.atArt.142.

[57] Id.atArt.143.

[58] FAMILYCODEOFTHEPHILIPPINES,Art.256.

[59] Rollo,p.29.

[60] CIVILCODEOFTHEPHILIPPINES,Art.143.

[61] G.R.No.172027,July29,2010,626SCRA180,201.

[62] Id.at199.

[63] The Court consolidated the following cases: ABAKADA Guro Party List OfficerSamsonS.Alcantara,etal.v.TheHon.ExecutiveSecretaryEduardoR.

Ermita,G.R.No.168056;AquilinoQ.Pimentel,Jr.,etal.v.ExecutiveSecretary

Eduardo R. Ermita, et al., G.R. No. 168207; Association of Pilipinas Shell

Dealers, Inc., et al. v. Cesar V. Purisima, et al., G.R. No. 168461; Francis

JosephG.Escuderov.CesarV.Purisima,etal,G.R.No.168463;andBataan

Governor Enrique T. Garcia, Jr. v. Hon. Eduardo R. Ermita, et al., G.R. No.

168730.

[64] Id.

[65] Rollo,p.37.

[66] Id.at39.

[67] Id.at55­57.

[68] 482Phil.877­894(2004).

[69] Id.at890­891.

[70] Rollo,p.55.

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

[71] MalayanEmployeesAssociation­FFWv.MalayanInsuranceCo.,Inc.,G.R.

No.181357,February2,2010,611SCRA392,399;CatmonSalesInt'l.Corp.v.

Atty.Yngson,Jr.,G.R.No.179761,January15,2010,610SCRA236,245.

[72] FAMILYCODEOFTHEPHILIPPINES,Art.102(4).

[73] Id. at Art. 91; See also Tolentino, Arturo, M., Commentaries and JurisprudenceontheCIVILCODEOFTHEPHILIPPINES:VolumeOnewiththe

FAMILYCODEOFTHEPHILIPPINES,379(1990).

[74] FAMILYCODEOFTHEPHILIPPINES,Art.102.

[75] Tolentino,Arturo,M.,CommentariesandJurisprudenceontheCivilCodeof

thePhilippines:VolumeOnewiththeFamilyCodeofthePhilippines,401­402

(1990).

[76] CIVILCODEOFTHEPHILIPPINES,Art.142.

[77] Tolentino,Arturo,M.,CommentariesandJurisprudenceontheCIVILCODE

OFTHEPHILIPPINES:VolumeOne,365(1974).

[78] Tolentino,Arturo,M.,CommentariesandJurisprudenceontheCIVILCODE OFTHEPHILIPPINES:VolumeOnewiththeFAMILYCODEOFTHEPHILIPPINES,

472(1990).

[79] Rollo,p.55.

[80] Id.at56­57.

[81] FAMILYCODEOFTHEPHILIPPINES,Art.129(2).

[82] Id.atArt.129(3).

[83] Id.atArt.129(4).

[84] Id.atArt.129(5).

[85] Rollo,p.55.

[86] FamilyCodeofthePhilippines,Art.129(7).

5/29/2016

E­Library­InformationAtYourFingertips:PrinterFriendly

E­Library­InformationAtYourFingertips:PrinterFriendly Source:SupremeCourtE­Library
E­Library­InformationAtYourFingertips:PrinterFriendly Source:SupremeCourtE­Library

Source:SupremeCourtE­Library

Thispagewasdynamicallygenerated

bytheE­LibraryContentManagementSystem(E­LibCMS)