Macadangdang vs. CA

Munoz vs.
Ramirez
G.R. No. 156125, [August 25, 2010]
DOCTRINE:
Property acquired during marriage by gratuitous title by either spouse is excluded from the
community property; When the value of the paraphernal property is considerably more than
the conjugal improvement, said paraphernal property does not become conjugal property.
FACTS:
The residential lot in the subject property was registered in the name of Erlinda Ramirez, married
to Eliseo Carlos (respondents). On April 6, 1989, Eliseo, a Bureau of Internal Revenue employee,
mortgaged said lot, with Erlinda’s consent, to the GSIS to secure a P136,500.00 housing loan,
payable within twenty (20) years, through monthly salary deductions of P1,687.66. The
respondents then constructed a thirty-six (36)-square meter, two-story residential house on the
lot. On July 14, 1993, the title to the subject property was transferred to the petitioner by virtue
of a Deed of Absolute Sale, dated April 30, 1992, executed by Erlinda, for herself and as attorney-
in-fact of Eliseo, for a stated consideration of P602,000.00.
On September 24, 1993, the respondents filed a complaint with the RTC for the nullification of
the deed of absolute sale, claiming that there was no sale but only a mortgage transaction, and
the documents transferring the title to the petitioner’s name were falsified. The respondents
presented the results of the scientific examination conducted by the National Bureau of
Investigation of Eliseo’s purported signatures in the Special Power of Attorney dated April 29,
1992 and the Affidavit of waiver of rights dated April 29, 1992, showing that they were forgeries.
The petitioner, on the other hand, introduced evidence on the paraphernal nature of the subject
property since it was registered in Erlinda’s name.
The RTC ruled for petitioner finding that the property is paraphernal and consequently, the NBI
finding that Eliseo’s signatures in the special power of attorney and in the affidavit were forgeries
was immaterial because Eliseo’s consent to the sale was not necessary. The CA reversed and held
that pursuant to the second paragraph of Article 158 of the Civil Code and Calimlim-Canullas v.
Hon. Fortun, the subject property, originally Erlinda’s exclusive paraphernal property,
became conjugal property when it was used as collateral for a housing loan that was paid
through conjugal funds – Eliseo’s monthly salary deductions.
ISSUE:
Whether the subject property is paraphernal or conjugal
RULING:
The property is paraphernal property of Erlinda.
As a general rule, all property acquired during the marriage, whether the acquisition appears to
have been made, contracted or registered in the name of one or both spouses, is presumed to
be conjugal unless the contrary is proved. In the present case, clear evidence that Erlinda
inherited the residential lot from her father has sufficiently rebutted this presumption
of conjugal ownership pursuant to Articles 92and 109 of the Family Code. The residential lot,
therefore, is Erlinda’s exclusive paraphernal property.
Moreover, we cannot subscribe to the CA’s misplaced reliance on Article 158 of the Civil Code
and Calimlim-Canullas. As the respondents were married during the effectivity of the Civil Code,
its provisions on conjugal partnership of gains(Articles 142 to 189) should have governed their
property relations. However, with the enactment of the Family Code on August 3, 1989, the Civil
Code provisions on conjugal partnership of gains, including Article 158, have been superseded by
those found in the Family Code (Articles 105 to 133).
Article 120 of the Family Code, which supersedes Article 158 of the Civil Code, provides the
solution in determining the ownership of the improvements that are made on the separate
property of the spouses, at the expense of the partnership or through the acts or efforts of either
or both spouses. Applying the said provision to the present case, we find that Eliseo paid a portion
only of the GSIS loan through monthly salary deductions. From April 6, 1989 to April 30,
1992, Eliseo paid about P60,755.76, not the entire amount of the GSIS housing loan plus interest,
since the petitioner advanced the P176,445.27 paid by Erlinda to cancel the mortgage in 1992.
Considering the P136,500.00 amount of the GSIS housing loan, it is fairly reasonable to assume
that the value of the residential lot is considerably more than theP60,755.76 amount paid
by Eliseo through monthly salary deductions. Thus, the subject property remained the exclusive
paraphernal property of Erlinda at the time she contracted with the petitioner; the written consent
of Eliseo to the transaction was not necessary. The NBI finding that Eliseo’s signatures in the
special power of attorney and affidavit were forgeries was immaterial.
Nonetheless, the RTC and the CA apparently failed to consider the real nature of the contract
between the parties (where the SC found that the contract is an equitable mortgage and not one
of sale).

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Munoz vs.

G.R. No. 156125, [August 25, 2010]

Whether the subject property is paraphernal or conjugal

The property is paraphernal property of Erlinda.

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