Civ Retroactivity

7/25/2019 Civ Retroactivity

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Republic of the PhilippinesSUPREME COURT

Manila

THIRD DIVISION

G.R. No. 173632 September 29, 2014

AMBROSO ROTARO !"#b"t$t#te% b& '$" "po#"e MARA RONSA (RO ROTARO, )*% '$"+'$%re* -ENA ROTARO, ERN/A ROTARO CRU, EU/OSA ROTARO CRA/O, NEESROTARO TUBG, REME/OS ROTARO MACAG, -ESA ROTARO EGASP, OSE-NAROTARO TORREAS, )*% CRSENCO R. ROTARO, MARCANA TBA(, EUGENOPUNAAN, )*% CENTE /E ROSARO,Petitioners,vs.RORA ACANTARA )*% CTOR ACANTARA,Respondents.

D ! I S I O N

RE(ES, J.:

"or revie# is the Decision1dated $ul% &', &(() and Resolution2dated $ul% *, &((+ of the !ourt ofppeals -! in !/0.R. !V No. )12)), #hich set aside the Decision3dated Dece3ber &*, '44+ of

the Re5ional Trial !ourt -RT! of ntipolo, Ri6al, 7ranch *' in !ivil !ase No. +*&.!ivil !ase No. +*& #as filed b% the respondent Rovira lcantara -Rovira for the recover% ofpossession of a parcel of land in 7aran5a% San ndres, !ainta, Ri6al, 3easurin5 &,*** s8uare 3etersand ori5inall% titled under Transfer !ertificate of Title -T!T No. 21'('1. Said propert% #as for3erl%o#ned b% Rovira9s father, Victor !. lcantara -lcantara, and lfredo !. I5nacio -I5nacio, #ho3ort5a5ed the propert% to Pilipinas 7an: and Trust !o3pan% -Pilipinas 7an: in '4+1. T#o %earsafter, the propert% #as parcelled out b% lcantara and I5nacio, throu5h their fir3 ;ilfredo S. I5nacio

In the 3eanti3e, lcantara and I5nacio defaulted in their loan obli5ations causin5 Pilipinas 7an: toforeclose the 3ort5a5e on the entire propert%. ;ithout rede3ption bein5 3ade b% lcantara andI5nacio, title #as consolidated in the na3e of Pilipinas 7an:, bein5 the hi5hest bidder durin5 theauction sale. Pilipinas 7an: then sold the propert% in a Deed of bsolute Sale dated $une +, '4*) toRovira, #ho happens to be lcantara9s dau5hter.5

In '411, Rovira filed her 3ended !o3plaint in !ivil !ase No. +*& for recover% of possession andda3a5es.fter trial, the RT! dis3issed !ivil !ase No. +*&. The Decision dated Dece3ber &*, '44+provides for the follo#in5 dispositive portion?

;HR"OR, @ud53ent is hereb% rendered dis3issin5 the co3plaint and defendant9s counterclai3Aand plaintiff, bein5 the successor/in/interest of the subdivision o#ner, ;ilfredo S. I5nacio, is ordered toissue the correspondin5 transfer certificate of title to defendant 3brosio Rotairo pursuant to the

provisions of PD BNo.C 4)*.SO ORDRD.6

The RT! ruled that the transaction bet#een I5nacio < !o. and Rotairo #as covered b% PresidentialDecree -P.D. No. 4)*.7Rovira, as successor/in/interest of ;ilfredo S.I5nacio Band Victor lcantaraC#as #ell a#are of the condition of the propert% #hich she bou5ht fro3 the Pilipinas 7an:, becauseshe lives near the land, and at the ti3e she purchased it she #as a#are of the e>istin5 houses orstructures on the land.8She #as, therefore, not entitled to the relief pra%ed for in her co3plaint.

On appeal, the ! set aside the RT! decision and ordered the turnover of possession of the propert%
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to Rovira. The dispositive portion of the assailed ! Decision dated $ul% &', &(() provides?

;HR"OR, the decision appealed fro3 is ST SID. The Heirs of 3brosio Rotairo and theirassi5ns, are ORDRD to turn over possession of =ot !/' to Rovira lcantara. Third part%defendants, ;illia3 BsicC I5nacio and Victor lcantara, are ORDRD to return the purchase priceof P'(,(((.(( to the Heirs of 3brosio Rotairo, #ith interest at the rate of +E per annu3 until finalit%of this decision, and at the rate of '&E per annu3 thereafter until full% paid.

SO ORDRD.9Petitioners sou5ht reconsideration, #hich #as denied b% the ! in the assailed Resolution10dated$ul% *, &((+.

In 5rantin5 possession in favor of Rovira, the ! held that P.D. No. 4)* is not applicable since the3ort5a5e#as constituted prior to the sale to Rotairo. ccordin5 to the !, Section '111of P.D. No.4)* protects innocent lot bu%ers, and #here there is a prior re5istered 3ort5a5e, the bu%er purchasesit #ith :no#led5e of the 3ort5a5e. In the caseof Rotairo, P.D. No. 4)* does not confer 3ore ri5hts toan unre5istered bu%er li:e hi3, as a5ainst a re5istered prior 3ort5a5ee li:e Pilipinas 7an: and itsbu%er, Rovira.12Hence, the present petition.

Petitioners raise the follo#in5 issues?

'. ;hether or not, not#ithstandin5 that the sub@ect land is subdivision lot, 3brosio Rotairo-father of the Petitioners, BaC bu%er and builder in 5ood faith should suffer, #hile the seller inbad faith Victor lcantara should be benefited b% his 3alicious acts.

&. ;hether or not, 3brosio Rotairo -father of the Petitioners, a bu%er and builder in 5ood faithshould suffer #hile the seller in bad faith Victor lcantara should be benefited b% his 3aliciousacts.13

Petitioners insist on the applicabilit%of P.D. No. 4)* in this case, and that the transaction bet#eenRotairo and I5nacio < !o. should fall #ithin the protection of the la#. On the other hand, Roviraprincipall% relies on the prior re5istration of the 3ort5a5e and the sale in her favor vis/F/visthepetitioners9 unre5istered transactions.

The first issue then that 3ust be resolved is #hether P.D. No. 4)* is applicable in this case. 7ut the3ore crucial issue before the !ourt is #ho, as bet#een the petitioners and Rovira, has better ri5ht tothe propert% in disputeG

Retroactive application of P.D. No. 4)*

The retroactive application of P.D. No. 4)* to transactions entered into prior to its enact3ent in '4*+ isalread% settled.'#phi' In u5enio v. >ec. Sec. Drilon,14#hich involved a land purchase a5ree3ententered into in '4*&, the !ourt stated that the un3ista:eable intent of the le5islature is to have P.D.No. 4)* operate retrospectivel%. Moreover, the specific ter3s of P.D. No. 4)* provide for its retroactiveeffect even to contracts and transactions entered into prior to its enact3ent. In particular, Section &' ofP.D. No. 4)* provides?

Sec. &'. Sales Prior to Decree. In cases of subdivision lots or condo3iniu3 units sold or disposed of

prior to the effectivit% of this Decree, it shall be incu3bent upon the o#ner or developer of thesubdivision or condo3iniu3 pro@ect to co3plete co3pliance #ith his or its obli5ations as provided inthe precedin5 section #ithin t#o %ears fro3 the date of this Decree unless other#ise e>tended b% the

uthorit% or unless an ade8uate perfor3ance bond isfiled in accordance #ith Section + hereof.

"ailure of the o#ner or developer to co3pl% #ith the obli5ations under this and the precedin5provisions shall constitute a violation punishable under Section 1 and 4 ofthis Decree. -3phasisours

In this case, the contract to sell bet#een Rotairo and I5nacio < !o. #as entered into in '4*(, and thea5ree3ent #as full% consu33ated #ith Rotairo9s co3pletion of pa%3ents and the e>ecution of the
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Deed of Sale in his favor in '4*4. !learl%, P.D. No. 4)* is applicable in this case.

It #as error for the ! to rule thatthe retroactive application of P.D. No. 4)* is #arranted onl% #herethe subdivision is 3ort5a5ed after bu%ers have purchased individual lots.15ccordin5 to the !, thepurpose of Section '1 re8uirin5 notice of the 3ort5a5e to the bu%ers is to 5ive the bu%er the option topa% the instal3ents directl% to the 3ort5a5eeA hence, if the subdivision is 3ort5a5ed before the lotsare sold, then there are no bu%ers to notif%.16;hat the ! overloo:ed is that Section &' re8uires the

o#ner or developer of the subdivision pro@ect to co3plete co3pliance #ith its obli5ations #ithin t#o%ears fro3 '4*+.The t#o/%ear co3pliance provides the developer the opportunit% to co3pl% #ith itsobli5ation to notif% the bu%ers of the e>istence of the 3ort5a5e, and conse8uentl%, for the latter toe>ercise their option to pa% the instal3ents directl% to the 3ort5a5ee.

Nevertheless, such conco3itant obli5ation of the developer under Section &' did not arise in this case.It 3ust be noted that at the ti3e of the enact3ent of P.D. No. 4)* in '4*+ and asearl% as '4*2,Pilipinas 7an: had alread% foreclosed the 3ort5a5e and bou5ht the properties in the foreclosure sale.There #as, thus, no 3ort5a5e to spea: of such that Rotairo should be notified thereof so that he couldproperl% e>ercise his option to pa% the instal3ents directl% to Pilipinas 7an:.

Rovira is not a bu%er in 5ood faith

Not#ithstandin5 the precedin5 discussion, the !ourt finds that Rovira cannot clai3 a better ri5ht to the

propert% because she is not a bu%er in 5ood faith. Initiall%, it 3ust be stated that the deter3ination of#hether one is a bu%er in 5ood faith is a factual issue, #hich 5enerall% cannotbe deter3ined b% the!ourt in a petition for revie# filed under Rule 2).17The rule, nonetheless, ad3its of e>ceptions,so3eof #hich are #hen the @ud53ent of the ! is based on a 3isapprehension offacts or #hen the! overloo:ed undisputed facts #hich, if properl% considered, #ould @ustif% a different conclusion.18revie# of this case sho#s that the ! failed to appreciate the relevance of certain undisputed facts,thus 5ivin5 rise to its erroneous conclusion that Rovira has a better ri5ht to the propert% in dispute.

Rovira contended that the re5istered 3ort5a5e bet#een Pilipinas 7an: and lcantara and I5nacio issuperior to the unre5istered contract to sell bet#een I5nacio < !o. and Rotairo, #hich #as sustainedb% the !. The ! applied Section )( of ct No. 24+ or the =and Re5istration ct and ruled that sincethe sale to Rotairo #as unre5istered and subse8uent to the re5istered 3ort5a5e, the latter #as

obli5ated to respect the foreclosure and eventual sale of the propert% in dispute, a3on5 others.19Indeed, the rule is that as BbCet#een t#o transactions concernin5 the sa3e parcel of land, there5istered transaction prevails over the earlier unre5istered ri5ht.20This is in accord #ith Section )(of the =and Re5istration ct,21#hich provides?

Sec. )(. n o#ner of re5istered land 3a% conve%, 3ort5a5e, lease, char5e, or other#ise deal #ith thesa3e as full% as if it had not been re5istered. He 3a% use for3s of deeds, 3ort5a5esB,C leases, orother voluntar% instru3ents li:e those no# in use and sufficient in la# for the purpose intended. 7ut nodeed, 3ort5a5e, lease, or other voluntar% instru3ent, e>cept a #ill purportin5 to conve% or affectre5istered land, shall ta:e effect as a conve%ance or bind the land, but shall operate onl% as a contractbet#een the parties and as evidence of authorit% to the cler: or re5ister of deeds to 3a:e re5istration.The act of re5istration shall be the operative act to conve% and affect the land, and in all cases under

this ct the re5istration shall be 3ade inthe office of re5ister of deeds for the province or provinces orcit% #here the land lies. -3phasis ours

Section )' of the =and Re5istration ct further states that BeCver% conve%ance, 3ort5a5e, lease, lien,attach3ent, order, decree, instru3ent, or entr% affectin5 re5istered land > > >, if re5istered > > > benotice to all persons fro3 the ti3e of such re5isterin5> > >. The principal purpose of re5istration is3erel% to notif% other persons not parties to a contract that a transaction involvin5 the propert% hasbeen entered into.22Thus, it has been held that re5istration in a publicre5istr% creates constructivenotice to the #hole #orld.23Moreover, BaC person dealin5 #ith re5istered land 3a% safel% rel% on thecorrectness of the certificate of title issued therefor, and he is not re8uired to 5o be%ond the certificate
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to deter3ine the condition of the propert%.24

The rule, ho#ever, is not #ithout reco5ni6ed e>ceptions. The conve%ance shall not be valid a5ainstan% person unless re5istered, e>cept -' the 5rantor, -& his heirs and devisees, and - third personshavin5 actual notice or :no#led5e thereof.25Moreover, #hen the part% has actual :no#led5e offacts and circu3stances that #ould i3pel a reasonabl% cautious 3an to 3a:e such in8uir% or #henthe purchaser has :no#led5e of a defect or the lac: of title in his vendor or of sufficient facts to induce

a reasonabl% prudent 3an to in8uire into the status of the title of the propert% in liti5ation, 26he cannotfind solace in the protection afforded b% a prior re5istration. Neither can such person be considered aninnocent purchaser for value nor a purchaser in 5ood faith.27

In this case, t#o factors #or: a5ainst Rovira as a bu%er in 5ood faith. One, she cannot be considereda third person for purposes of appl%in5 the rule. Rovira does not den% that she is the dau5hter and anheir of Victor !. lcantara, one of the parties to the contract to sell -and the contract of sale e>ecutedin favor of Rotairo. The vendor9s heirs are his privies.287ased on such privit%, Rovira is char5ed #ithconstructive :no#led5e of prior dispositions or encu3brances affectin5 the sub@ect propert% 3ade b%her father.29The fact that the contract to sell #as unre5istered beca3e i33aterial and she is,therefore, bound b% the provisions of the contract to sell and eventuall%, the contract of sale, e>ecutedb% her father in favor of Rotairo.

"urther, 3ore than the char5eof constructive :no#led5e, the surroundin5 circu3stances of this casesho# Rovira9s actual :no#led5eof the disposition of the sub@ect propert% and Rotairo9s possessionthereof. It is undisputed that after the contract to sell #as e>ecuted in pril '4*(, Rotairo i33ediatel%secured a 3a%or9s per3it in Septe3ber &1, '4*( for the construction of his residential house on thepropert%.30Rotairo, and subse8uentl%, his heirs, has been residin5 on the propert% since then. Rovira,#ho lives onl% fift% -)( 3eters a#a% fro3 the sub@ect propert%, in fact, :ne# that there #erestructures built on the propert%.31Rovira, ho#ever, clai3s that she did not bother to in8uire as tothe le5iti3ac% of the ri5hts of the occupants, because she #as assured b% the ban: of its title to thepropert%.327ut Rovira cannot rel% solel% on the title and assurances of Pilipinas 7an:A it #asincu3bent upon her to loo: be%ond the title and 3a:e necessar% in8uiries because the ban: #as notin possession of the propert%. ;here the vendor is not in possession of the propert%, the prospectivevendees are obli5ated to investi5ate the ri5hts of one in possession.33 purchaser cannot si3pl%

close his e%es to facts #hich should put a reasonable 3an on 5uard, 34and thereafter clai3 that heacted in 5ood faith under the belief that there #as no defect in the title of the vendor. 35Hence, Roviracannot clai3 a ri5ht better than that of RotairoJ s as she is not a bu%er in 5ood faith.

BICt is a settled rule that the =and Re5istration ct protects onl% holders of title in 5ood faith, and doesnot per3it its provision to be used as a shield for the co33ission of fraud, or as a 3eans to enrichoneself at the e>pense of others. 36

Knder different circu3stances, the prior re5istration of the 3ort5a5e bet#een Pilipinas 7an: andlcantara and I5nacio, and RoviraJs subse8uent purchase of the sub@ect propert% #ould have beenvalid and bindin5, and could have defeated RotairoJs unre5istered clai3 over it. 7ut 5iven RoviraJsprivit% #ith her father Victor !. lcantara and the fact that she had actual :no#led5e of the dispositionof the propert% and RotairoJs possession thereof, her ac8uisition of the propert% cannot be upheld.

;HR"OR, the petition is 0RNTD. The Decision dated $ul% &', &(() and Resolution dated $ul%*, &((+ of the !ourt of ppeals in !/0.R. !V No. )12)) are ST SID. The Decision datedDece3ber &*, '44+ of the Re5ional Trial !ourt of ntipolo, Ri6al, 7ranch *', dis3issin5 !ivil !aseNo. +*& is RINSTTD.

SO ORDRD.

BENEN/O . RE(ESssociate $ustice
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Republic of the PhilippinesSUPREME COURT

ManilaS!OND DIVISION

G.R. No. 19121 #& 31, 2013

AMEA GARCA5UAON, ENNET UAON )*% MARA ENN-ER UAON, Petitioners,vs.MA. OUR/ES BEEN, or )*% $* be') o MARA OUR/ES ESE UAON,Respondent.

D ! I S I O N

PERE, J.:

This is a Petition for Revie# on !ertiorari filed pursuant to Rule 2) of the Revised Rules of !ourt,

pri3aril% assailin5 the &1 Nove3ber &((1 Decision rendered b% the Ninth Division of the !ourt ofppeals in !/0.R. !V No. 11)14,1the decretal portion of #hich states?

;HR"OR, pre3ises considered, the appeal is hereb% DNID. The assailed Decision datedMarch '', &((), and the Order dated March &2, &((+ of the Re5ional Trial !ourt, 7ranch &*), =asPiLas !it% are ""IRMD in toto.2

The "acts

This case started as a Petition for =etters of d3inistration of the state of liseo uia6on -liseo,filed b% herein respondents #ho are liseo9s co33on/la# #ife and dau5hter. The petition #asopposed b% herein petitioners 3elia 0arcia/uai6on -3elia to #ho3 liseo #as 3arried. 3elia#as @oined b% her children, $enneth uia6on -$enneth and Maria $ennifer uia6on -$ennifer.

liseo died intestate on '& Dece3ber '44&.On '& Septe3ber '442, Maria =ourdes lise uia6on -lise, represented b% her 3other, Ma. =ourdes7elen -=ourdes, filed a Petition for =etters of d3inistration before the Re5ional Trial !ourt -RT! of=as PiLas !it%.3In her Petition doc:eted as SP Proc. No. M/4)*, lise clai3s that she is the naturalchild of liseo havin5 been conceived and born at the ti3e #hen her parents #ere both capacitated to3arr% each other. Insistin5 on the le5al capacit% of liseo and =ourdes to 3arr%, lise i3pu5ned thevalidit% of liseo9s 3arria5e to 3elia b% clai3in5 that it #as bi5a3ous for havin5 been contracteddurin5 the subsistence of the latter9s 3arria5e #ith one "ilipito Sandico -"ilipito. To prove her filiationto the decedent, lise, a3on5 others, attached to the Petition for =etters of d3inistration her!ertificate of =ive 7irth4si5ned b% liseo as her father. In the sa3e petition, it #as alle5ed that liseoleft real properties #orth P&,(2(,(((.(( and personal properties #orth P&,'((,(((.((. In order topreserve the estate of liseo and to prevent the dissipation of its value, lise sou5ht her appoint3ent

as ad3inistratri> of her late father9s estate.

!lai3in5 that the venue of the petition #as i3properl% laid, 3elia, to5ether #ith her children, $ennethand $ennifer, opposed the issuance of the letters of ad3inistration b% filin5 an OppositionMotion toDis3iss.5The petitioners asserted that as sho#n b% his Death !ertificate, 6liseo #as a resident of!apas, Tarlac and not of =as PiLas !it%, at the ti3e of his death. Pursuant to Section ', Rule * of theRevised Rules of !ourt,7the petition for settle3ent of decedent9s estate should have been filed in!apas, Tarlac and not in =as PiLas !it%. In addition to their clai3 of i3proper venue, the petitionersaverred that there are no factual and le5al bases for lise to be appointed ad3inistrati> of liseo9sestate.
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In a Decision8dated '' March &((), the RT! directed the issuance of =etters of d3inistration tolise upon postin5 the necessar% bond. The lo#er court ruled that the venue of the petition #asproperl% laid in =as PiLas !it%, thereb% discreditin5 the position ta:en b% the petitioners that liseo9slast residence #as in !apas, Tarlac, as hearsa%. The dispositive of the RT! decision reads?

Havin5 attained le5al a5e at this ti3e and there bein5 no sho#in5 of an% dis8ualification orinco3petence to serve as ad3inistrator, let letters of ad3inistration over the estate of the decedentliseo uia6on, therefore, be issued to petitioner, Ma. =ourdes lise uia6on, after the approval b%this !ourt of a bond in the a3ount of P'((,(((.(( to be posted b% her.9

On appeal, the decision of the trial court #as affir3ed in toto in the &1 Nove3ber &((1Decision10rendered b% the !ourt of ppeals in !/0.R.!V No. 11)14. In validatin5 the findin5s ofthe RT!, the !ourt of ppeals held that lise #as able to prove that liseo and =ourdes lived to5etheras husband and #ife b% establishin5 a co33on residence at No. &+ verlastin5 Road, Phase ), PilarVilla5e, =as PiLas !it%, fro3 '4*) up to the ti3e of liseo9s death in '44&. "or purposes of fi>in5 thevenue of the settle3ent of liseo9s estate, the !ourt of ppeals upheld the conclusion reached b% theRT! that the decedent #as a resident of =as PiLas !it%. The petitioners9 Motion for Reconsideration#as denied b% the !ourt of ppeals in its Resolution11dated * u5ust &((4.

The Issues

The petitioners no# ur5e Ks to reverse the assailed !ourt of ppeals Decision and Resolution on thefollo#in5 5rounds?

I. TH !OKRT O" PP=S 0RV= RRD IN ""IRMIN0 THT =ISO KION;S RSIDNT O" =S PIQS ND THR"OR, TH PTITION "OR =TTRS O"

DMINISTRTION ;S PROPR= "I=D ;ITH TH RT! O" =S PIQSA

II. TH !OKRT O" PP=S 0RV= RRD IN D!=RIN0 THT M=I 0R!I/KION ;S NOT =0== MRRID TO =ISO KION DK TO PRISTIN0MRRI0A ND

III. TH !OKRT O" PP=S OVR=OOD TH "!T THT =IS KION HS NOTSHO;N N INTRST IN TH PTITION "OR =TTRS O" DMINISTRTION.12

The !ourt9s Rulin5;e find the petition bereft of 3erit.

Knder Section ', Rule * of the Rules of !ourt, the petition for letters of ad3inistration of the estate ofa decedent should be filed in the RT! of the province #here the decedent resides at the ti3e of hisdeath?

Sec. '. ;here estate of deceased persons settled. If the decedent is an inhabitant of the Philippinesat the ti3e of his death, #hether a citi6en or an alien, his #ill shall be proved, or letters ofad3inistration 5ranted, and his estate settled, in the !ourt of "irst Instance no# Re5ional Trial !ourt inthe province in #hich he resides at the ti3e of his death, and if he is an inhabitant of a forei5n countr%,the !ourt of "irst Instance no# Re5ional Trial !ourt of an% province in #hich he had estate. The courtfirst ta:in5 co5ni6ance of the settle3ent of the estate of a decedent, shall e>ercise @urisdiction to thee>clusion of all other courts. The @urisdiction assu3ed b% a court, so far as it depends on the place ofresidence of the decedent, or of the location of his estate, shall not be contested in a suit orproceedin5, e>cept in an appeal fro3 that court, in the ori5inal case, or #hen the #ant of @urisdictionappears on the record. -3phasis supplied.

The ter3 resides connotes e> vi ter3ini actual residence as distin5uished fro3 le5al residence ordo3icile. This ter3 resides, li:e the ter3s residin5 and residence, is elastic and should beinterpreted in the li5ht of the ob@ect or purpose of the statute or rule in #hich it is e3plo%ed. In theapplication of venue statutes and rules Section ', Rule * of the Revised Rules of !ourt is of suchnature residence rather than do3icile is the si5nificant factor.13ven #here the statute uses #ord
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do3icile still it is construed as 3eanin5 residence and not do3icile in the technical sense.14So3ecases 3a:e a distinction bet#een the ter3s residence and do3icile but as 5enerall% used instatutes fi>in5 venue, the ter3s are s%non%3ous, and conve% the sa3e 3eanin5 as the ter3inhabitant.15In other #ords, resides should be vie#ed or understood in its popular sense,3eanin5, the personal, actual or ph%sical habitation of a person, actual residence or place ofabode.16It si5nifies ph%sical presence in a place and actual sta% thereat.17Venue for ordinar% civilactions and that for special proceedin5s have one and the sa3e 3eanin5.18s thus defined,

residence, in the conte>t of venue provisions, 3eans nothin5 3ore than a person9s actual residenceor place of abode, provided he resides therein #ith continuit% and consistenc%.19

Vie#ed in li5ht of the fore5oin5 principles, the !ourt of ppeals cannot be faulted for affir3in5 therulin5 of the RT! that the venue for the settle3ent of the estate of liseo #as properl% laid in =asPiLas !it%. It is evident fro3 the records that durin5 his lifeti3e, liseo resided at No. &+ verlastin5Road, Phase ), Pilar Villa5e, =as PiLas !it%. "or this reason, the venue for the settle3ent of his estate3a% be laid in the said cit%.

In opposin5 the issuance of letters of ad3inistration, the petitioners harp on the entr% in liseo9s Death!ertificate that he is a resident of !apas, Tarlac #here the% insist his estate should be settled. ;hilethe recitals in death certificates can be considered proofs of a decedent9s residence at the ti3e of hisdeath, the contents thereof, ho#ever, is not bindin5 on the courts. 7oth the RT! and the !ourt of

ppeals found that liseo had been livin5 #ith =ourdes, deportin5 the3selves as husband and #ife,fro3 '4*& up to the ti3e of his death in '44). This findin5 is consistent #ith the fact that in '41),liseo filed an action for @udicial partition of properties a5ainst 3elia before the RT! of ue6on !it%,7ranch '(+, on the 5round that their 3arria5e is void for bein5 bi5a3ous.20That liseo #ent to thee>tent of ta:in5 his 3arital feud #ith 3elia before the courts of la# renders untenable petitioners9position that liseo spent the final da%s of his life in Tarlac #ith 3elia and her children. It disprovesrather than supports petitioners9 sub3ission that the lo#er courts9 findin5s arose fro3 an erroneousappreciation of the evidence on record. "actual findin5s of the trial court, #hen affir3ed b% theappellate court, 3ust be held to be conclusive and bindin5 upon this !ourt.21

=i:e#ise un3eritorious is petitioners9 contention that the !ourt of ppeals erred in declarin5 3elia9s3arria5e to liseo as void ab initio. In a void 3arria5e, it #as thou5h no 3arria5e has ta:en place,

thus, it cannot be the source of ri5hts. n% interested part% 3a% attac: the 3arria5e directl% orcollaterall%. void 3arria5e can be 8uestioned even be%ond the lifeti3e of the parties to the3arria5e.22It 3ust be pointed out that at the ti3e of the celebration of the 3arria5e of liseo and

3elia, the la# in effect #as the !ivil !ode, and not the "a3il% !ode, 3a:in5 the rulin5 in NiLal v.7a%ado523applicable four/s8uare to the case at hand. In NiLal, the !ourt, in no uncertain ter3s,allo#ed therein petitioners to file a petition for the declaration of nullit% of their father9s 3arria5e totherein respondent after the death of their father, b% contradistin5uishin5 void fro3 voidable 3arria5es,to #it?

!onse8uentl%, void 3arria5es can be 8uestioned even after the death of either part% but voidable3arria5es can be assailed onl% durin5 the lifeti3e of the parties and not after death of either, in #hichcase the parties and their offsprin5 #ill be left as if the 3arria5e had been perfectl% valid. That is #h%the action or defense for nullit% is i3prescriptible, unli:e voidable 3arria5es #here the actionprescribes. Onl% the parties to a voidable 3arria5e can assail it but an% proper interested part% 3a%attac: a void 3arria5e.24

It #as e3phasi6ed in NiLal that in a void 3arria5e, no 3arria5e has ta:en place and it cannot be thesource of ri5hts, such that an% interested part% 3a% attac: the 3arria5e directl% or collaterall% #ithoutprescription, #hich 3a% be filed even be%ond the lifeti3e of the parties to the 3arria5e.25

Relevant to the fore5oin5, there is no doubt that lise, #hose successional ri5hts #ould be pre@udicedb% her father9s 3arria5e to 3elia, 3a% i3pu5n the e>istence of such 3arria5e even after the death ofher father. The said 3arria5e 3a% be 8uestioned directl% b% filin5 an action attac:in5 the validit%
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thereof, or collaterall% b% raisin5 it as an issue in a proceedin5 for the settle3ent of the estate of thedeceased spouse, such as in the case at bar. Ineluctabl%, lise, as a co3pulsor% heir, 26has a causeof action for the declaration of the absolute nullit% of the void 3arria5e of liseo and 3elia, and thedeath of either part% to the said 3arria5e does not e>tin5uish such cause of action.

Havin5 established the ri5ht of lise to i3pu5n liseo9s 3arria5e to 3elia, #e no# proceed todeter3ine #hether or not the decedent9s 3arria5e to 3elia is void for bein5 bi5a3ous.

!ontrar% to the position ta:en b% the petitioners, the e>istence of a previous 3arria5e bet#een 3eliaand "ilipito #as sufficientl% established b% no less than the !ertificate of Marria5e issued b% theDiocese of Tarlac and si5ned b% the officiatin5 priest of the Parish of San Nicolas de Tolentino in!apas, Tarlac. The said 3arria5e certificate is a co3petent evidence of 3arria5e and the certificationfro3 the National rchive that no infor3ation relative to the said 3arria5e e>ists does not di3inish theprobative value of the entries therein. ;e ta:e @udicial notice of the fact that the first 3arria5e #ascelebrated 3ore than )( %ears a5o, thus, the possibilit% that a record of 3arria5e can no lon5er befound in the National rchive, 5iven the interval of ti3e, is not co3pletel% re3ote. !onse8uentl%, in theabsence of an% sho#in5 that such 3arria5e had been dissolved at the ti3e 3elia and liseo9s3arria5e #as sole3ni6ed, the inescapable conclusion is that the latter 3arria5e is bi5a3ous and,therefore, void ab initio.27

Neither are #e inclined to lend credence to the petitioners9 contention that lise has not sho#n an%interest in the Petition for =etters of d3inistration.

Section +, Rule *1 of the Revised Rules of !ourt la%s do#n the preferred persons #ho are entitled tothe issuance of letters of ad3inistration, thus?

Sec. +. ;hen and to #ho3 letters of ad3inistration 5ranted. U If no e>ecutor is na3ed in the #ill, orthe e>ecutor or e>ecutors are inco3petent, refuse the trust, or fail to 5ive bond, or a person diesintestate, ad3inistration shall be 5ranted?

-a To the survivin5 husband or #ife, as the case 3a% be, or ne>t of :in, or both, in thediscretion of the court, or to such person as such survivin5 husband or #ife, or ne>t of :in,re8uests to have appointed, if co3petent and #illin5 to serveA

-b If such survivin5 husband or #ife, as the case 3a% be, or ne>t of :in, or the person selected

b% the3, be inco3petent or un#illin5, or if the husband or #ido#, or ne>t of :in, ne5lects forthirt% -( da%s after the death of the person to appl% for ad3inistration or to re8uest thatad3inistration be 5ranted to so3e other person, it 3a% be 5ranted to one or 3ore of theprincipal creditors, if co3petent and #illin5 to serveA

-c If there is no such creditor co3petent and #illin5 to serve, it 3a% be 5ranted to such otherperson as the court 3a% select.

Kpon the other hand, Section & of Rule *4 provides that a petition for =etters of d3inistration 3ust befiled b% an interested person, thus?

Sec. &. !ontents of petition for letters of ad3inistration. U petition for letters of ad3inistration 3ustbe filed b% an interested person and 3ust sho#, so far as :no#n to the petitioner?

-a The @urisdictional factsA-b The na3es, a5es, and residences of the heirs, and the na3es and residences of thecreditors, of the decedentA

-c The probable value and character of the propert% of the estateA

-d The na3e of the person for #ho3 letters of ad3inistration are pra%ed.

7ut no defect in the petition shall render void the issuance of letters of ad3inistration.

n interested part%, in estate proceedin5s, is one #ho #ould be benefited in the estate, such as an
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heir, or one #ho has a clai3 a5ainst the estate, such as a creditor. lso, in estate proceedin5s, thephrase ne>t of :in refers to those #hose relationship #ith the decedent Is such that the% are entitledto share in the estate as distributees.28

In the instant case, lise, as a co3pulsor% heir #ho stands to be benefited b% the distribution ofliseo9s estate, is dee3ed to be an interested part%. ;ith the over#hel3in5 evidence on recordproduced b% lise to prove her filiation to liseo, the petitioners9 poundin5 on her lac: of interest in thead3inistration of the decedent9s estate, is @ust a desperate atte3pt to s#a% this !ourt to reverse thefindin5s of the !ourt of ppeals. !ertainl%, the ri5ht of lise to be appointed ad3inistrati> of the estateof liseo is on 5ood 5rounds. It is founded on her ri5ht as a co3pulsor% heir, #ho, under the la#, isentitled to her le5iti3ate after the debts of the estate are satisfied. 29Havin5 a vested ri5ht in thedistribution of liseo9s estate as one of his natural children, lise can ri5htfull% be considered as aninterested part% #ithin the purvie# of the la#.

;HR"OR, pre3ises considered, the petition is DNID for lac: of 3erit. ccordin5l%, the !ourt ofppeals assailed &1 Nove3ber &((1 Decision and * u5ust &((4 Resolution, arc ""IRMD in toto.

SO ORDRD.

OSE PORTUGA PEREssociate $ustice

Republic of the Philippines

Supre3e !ourtManila

SECON/ /SON

BRG/O B. UAO,Pet$t$o*er,

/ versus /

RTA C. UAO, 8TCE C. UAO, OTS C.UAO, PETCE C. UAO, repre"e*te% b&

t'e$r mot'er RTA UAO,Re"po*%e*t".

G.R. No 1766

Present?

!RPIO, J., Chairperson,7RION,PR,SRNO, andRS, JJ.

Pro3ul5ated?$ul% 2, &('&

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/ECSON
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RE(ES, J.:

The fa3il% is the basic and the 3ost i3portant institution of societ%. It is in the fa3il% #here children

are born and 3olded either to beco3e useful citi6ens of the countr% or trouble3a:ers in the

co33unit%. Thus, #e are saddened #hen parents have to separate and fi5ht over properties, #ithout

re5ard to the 3essa5e the% send to their children.Not#ithstandin5 this, #e 3ust not shir: fro3 our

obli5ation to rule on this case involvin5 le5al separation escalatin5 to 8uestions on dissolution and

partition of properties.

T'e C)"e

This case co3es before us viaPetition for Revie# on CertiorariB'Cunder Rule 2) of the Rules of

!ourt. The petitioner see:s that #e vacate and set aside the OrderB&Cdated $anuar% 1, &((* of the

Re5ional Trial !ourt -RT!, 7ranch ', 7utuan !it%. In lieu of the said order, #e are as:ed to issue a

Resolution definin5 the net profits sub@ect of the forfeiture as a result of the decree of le5al separation

in accordance #ith the provision of rticle '(&-2 of the "a3il% !ode, or alternativel%, in accordance

#ith the provisions of rticle '*+ of the !ivil !ode.

A*te+e%e*t -)+t"

On October &+, &(((, herein respondent Rita !. uiao -Rita filed a co3plaint for le5al separation

a5ainst herein petitioner 7ri5ido 7. uiao -7ri5ido.BC Subse8uentl%, the RT! rendered a

DecisionB2Cdated October '(, &((), the dispositive portion of #hich provides?

;HR"OR, vie#ed fro3 the fore5oin5 considerations, @ud53ent is hereb% rendereddeclarin5 the le5al separation of plaintiff Rita !. uiao and defendant/respondent

7ri5ido 7. uiao pursuant to rticle )).

s such, the herein parties shall be entitled to live separatel% fro3 each other, but the3arria5e bond shall not be severed.>cept for =etecia !. uiao #ho is of le5al a5e, the three 3inor children, na3el%,itchie, =otis and Petchie, all surna3ed uiao shall re3ain under the custod% of theplaintiff #ho is the innocent spouse."urther, e>cept for the personal and real properties alread% foreclosed b% the R!7!, all
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the re3ainin5 properties, na3el%?'. coffee 3ill in 7alon5a5an, =as Nieves, 5usan del NorteA&. coffee 3ill in Durian, =as Nieves, 5usan del NorteA. corn 3ill in !asi:lan, =as Nieves, 5usan del NorteA2. coffee 3ill in speran6a, 5usan del SurA). a parcel of land #ith an area of ',&(( s8uare 3eters located in

Tun5ao, 7utuan !it%A+. a parcel of a5ricultural land #ith an area of ) hectares located in Manila de7u5abos, 7utuan !it%A*. a parcel of land #ith an area of 12 s8uare 3eters located in Tun5ao, 7utuan !it%A1. 7ashier 7on "actor% located in Tun5ao, 7utuan !it%A

shall be divided e8uall% bet#een herein BrespondentsC and BpetitionerC sub@ect to therespective le5iti3es of the children and the pa%3ent of the unpaid con@u5al liabilities ofBPC2),*2(.((.BPetitionersC share, ho#ever, of the net profits earned b% the con@u5al partnership isforfeited in favor of the co33on children.

He is further ordered to rei3burse BrespondentsC the su3 of BPC'4,(((.(( as attorne%Jsfees and liti5ation e>penses of BPC),(((.((B.CSO ORDRD.B)C

Neither part% filed a 3otion for reconsideration and appeal #ithin the period provided for under Section

'*-a and -b of the Rule on =e5al Separation.B+C

On Dece3ber '&, &((), the respondents filed a 3otion for e>ecutionB*C#hich the trial court 5ranted in

its Order dated Dece3ber '+, &((), the dispositive portion of #hich reads?

;herefore, findin5 the 3otion to be #ell ta:en, the sa3e is hereb% 5ranted. =et a #rit ofe>ecution be issued for the i33ediate enforce3ent of the $ud53ent.SO ORDRD.B1C

Subse8uentl%, on "ebruar% '(, &((+, the RT! issued a ;rit of >ecutionB4C#hich reads as follo#s?

NO; THR"OR, that of the 5oods and chattels of the BpetitionerC 7RI0IDO 7.KIO %ou cause to be 3ade the su3s stated in the afore/8uoted D!ISION BsicC,to5ether #ith %our la#ful fees in the service of this ;rit, all in the Philippine !urrenc%.

7ut if sufficient personal propert% cannot be found #hereof to satisf% this e>ecution and%our la#ful fees, then #e co33and %ou that of the lands and buildin5s of the saidBpetitionerC, %ou 3a:e the said su3s in the 3anner re8uired b% la#. ou are en@oined to
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strictl% observed Section 4, Rule 4, Rule BsicC of the '44* Rules of !ivil Procedure.ou are hereb% ordered to 3a:e a return of the said proceedin5s i33ediatel% after the

@ud53ent has been satisfied in part or in full in consonance #ith Section '2, Rule 4 ofthe '44* Rules of !ivil Procedure, as a3ended.B'(C

On $ul% +, &((+, the #rit #as partiall% e>ecuted #ith the petitioner pa%in5 the respondents the a3ount

of P2+,1*(.((, representin5 the follo#in5 pa%3ents?

-a P&&,1*(.(( as petitionerJs share of the pa%3ent of the con@u5al shareA

-b P'4,(((.(( as attorne%Js feesA and

-c P),(((.(( as liti5ation e>penses.B''C

On $ul% *, &((+, or after more than nine monthsfro3 the pro3ul5ation of the Decision, the petitioner

filed before the RT! a Motion for !larification,B'&Cas:in5 the RT! to define the ter3 Net Profits

arned.

To resolve the petitionerJs Motion for !larification, the RT! issued an OrderB'Cdated u5ust ',

&((+, #hich held that the phrase NT PRO"IT RND denotes the re3ainder of the properties of

the parties after deductin5 the separate properties of each Bof theC spouse and the debts.B'2CThe

Order further held that after deter3inin5 the re3ainder of the properties, it shall be forfeited in favor ofthe co33on children because the offendin5 spouse does not have an% ri5ht to an% share of the net

profits earned, pursuant to rticles +, No. -& and 2, No. -& of the "a3il% !ode.B')CThe dispositive

portion of the Order states?

;HR"OR, there is no blatant disparit% #hen the sheriff intends to forfeit all there3ainin5 properties after deductin5 the pa%3ents of the debts for onl% separateproperties of the defendant/respondent shall be delivered to hi3 #hich he has none.The Sheriff is herein directed to proceed #ith the e>ecution of the Decision.

IT IS SO ORDRD.B'+C

Not satisfied #ith the trial courtJs Order, the petitioner filed a Motion for ReconsiderationB'*Con

Septe3ber 1, &((+. !onse8uentl%, the RT! issued another OrderB'1Cdated Nove3ber 1, &((+,

holdin5 that althou5h the Decision dated October '(, &(() has beco3e final and e>ecutor%, it 3a% still
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consider the Motion for !larification because the petitioner si3pl% #anted to clarif% the 3eanin5 of net

profit earned.B'4C"urther3ore, the sa3e Order held?

A TO/, the !ourt Order dated u5ust ', &((+ is hereb% ordered set aside. NTPRO"IT RND, #hich is sub@ect of forfeiture in favor of BtheC partiesJ co33on

children, is ordered to be co3puted in accordance B#ithC par. 2 of rticle '(& of the"a3il% !ode.B&(C

On Nove3ber &', &((+, the respondents filed a Motion for Reconsideration,B&'Cpra%in5 for the

correction and reversal of the Order dated Nove3ber 1, &((+. Thereafter, on $anuar% 1, &((*,B&&Cthe

trial court had chan5ed its rulin5 a5ain and 5ranted the respondentsJ Motion for Reconsideration

#hereb% the Order dated Nove3ber 1, &((+ #as set aside to reinstate the Order dated u5ust ',

&((+.

Not satisfied #ith the trial courtJs Order, the petitioner filed on "ebruar% &*, &((* this instant Petition

for Revie# under Rule 2) of the Rules of !ourt, raisin5 the follo#in5?

""#e"

I

IS TH DISSO=KTION ND TH !ONSKNT =IKIDTION O" TH !OMMONPROPRTIS O" TH HKS7ND ND ;I" 7 VIRTK O" TH D!R O"=0= SPRTION 0OVRND 7 RTI!= '&) -SI! O" TH "MI= !ODG

II

;HT IS TH MNIN0 O" TH NT PRO"ITS RND 7 TH !ON$K0=PRTNRSHIP "OR PKRPOSS O" ""!TIN0 TH "OR"ITKR KTHORIDKNDR RTI!= + O" TH "MI= !ODG

III

;HT =; 0OVRNS TH PROPRT R=TIONS 7T;N TH HKS7NDND ;I" ;HO 0OT MRRID IN '4**G !N TH "MI= !OD O"TH PHI=IPPINS 7 0IVN RTRO!TIV ""!T "OR PKRPOSS O"DTRMININ0 TH NT PRO"ITS SK7$!T O" "OR"ITKR S RSK=T O"TH D!R O" =0= SPRTION ;ITHOKT IMPIRIN0 VSTD RI0HTS

=RD !KIRD KNDR TH !IVI= !ODG

IV

;HT PROPRTIS SH== 7 IN!=KDD IN TH "OR"ITKR O" TH SHR
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O" TH 0KI=T SPOKS IN TH NT !ON$K0= PRTNRSHIP S RSK=TO" TH ISSKN! O" TH D!R O" =0= SPRTIONGB&C

O#r R#$*;

;hile the petitioner has raised a nu3ber of issues on the applicabilit% of certain la#s, #e are #ell/

a#are that the respondents have called our attention to the fact that the Decision dated October '(,

&(() has attained finalit% #hen the Motion for !larification #as filed.B&2CThus, #e are constrained to

resolve first the issue of the finalit% of the Decision dated October '(, &(() and subse8uentl% discuss

the 3atters that #e can clarif%.

T'e /e+$"$o* %)te% O+tober 10, 200 ')" be+ome$*) )*% e


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trial, 3otion for reconsideration -#hether full or partial or an% final order or resolution.B&*CIn other

#ords, a part% liti5ant 3a% file his notice of appeal #ithin a fresh ')/da% period fro3 his receipt of the

trial courtJs decision or final order den%in5 his 3otion for ne# trial or 3otion for

reconsideration. "ailure to avail of the fresh ')/da% period fro3 the denial of the 3otion for

reconsideration 3a:es the decision or final order in 8uestion final and e>ecutor%.

In the case at bar, the trial court rendered its Decision on October '(, &((). The petitioner neither filed

a 3otion for reconsideration nor a notice of appeal. On Dece3ber '+, &((), or after +* da%s had

lapsed, the trial court issued an order 5rantin5 the respondentJs 3otion for e>ecutionA and on "ebruar%

'(, &((+, or after '& da%s had lapsed, the trial court issued a #rit of e>ecution. "inall%, #hen the #rit

had alread% been partiall% e>ecuted, the petitioner, on $ul% *, &((+ or after &*( da%s had lapsed, filed

his Motion for !larification on the definition of the net profits earned. "ro3 the fore5oin5, the petitionerhad clearl% slept on his ri5ht to 8uestion the RT!s Decision dated October '(, &(()."or &*( da%s, the

petitioner never raised a sin5le issue until the decision had alread% been partiall% e>ecuted. Thus at

the ti3e the petitioner filed his 3otion for clarification, the trial courts decision has beco3e final and

e>ecutor%. @ud53ent beco3es final and e>ecutor% #hen the re5le3entar% period to appeal lapses

and no appeal is perfected #ithin such period. !onse8uentl%, no court, not even this !ourt, can

arro5ate unto itself appellate @urisdiction to revie# a case or 3odif% a @ud53ent that beca3e final.B&1C

The petitioner ar5ues that the decision he is 8uestionin5 is a void @ud53ent. 7ein5 such, the

petitionerJs thesis is that it can still be disturbed even after &*( da%s had lapsed fro3 the issuance of

the decision to the filin5 of the 3otion for clarification. He said that a void @ud53ent is no @ud53ent at

all. It never attains finalit% and cannot be a source of an% ri5ht nor an% obli5ation.B&4C7ut #hat

precisel% is a void @ud53ent in our @urisdictionG ;hen does a @ud53ent beco3es voidG

@ud53ent is null and void #hen the court #hich rendered it had no po#er to 5rant the relief or no

@urisdiction over the sub@ect 3atter or over the parties or both.B(CIn other #ords, a court, #hich does

not have the po#er to decide a case or that has no @urisdiction over the sub@ect 3atter or the parties,

#ill issue a void @ud53ent or a coram non judice.B'C

The 8uestioned @ud53ent does not fall #ithin the purvie# of a void @ud53ent. "or sure, the trial court

has @urisdiction over a case involvin5 le5al separation. Republic ct -R.. No. 1+4 confers upon an


16/72

RT!, desi5nated as the "a3il% !ourt of a cit%, the e>clusive ori5inal @urisdiction to hear and decide,

a3on5 others, co3plaints or petitions relatin5 to 3arital status and propert% relations of the husband

and #ife or those livin5 to5ether.B&CThe Rule on =e5al SeparationBCprovides that the petition Bfor

le5al separationC shall be filed in the "a3il% !ourt of the province or cit% #here the petitioner or the

respondent has been residin5 for at least si> 3onths prior to the date of filin5 or in the case of a non/

resident respondent, #here he 3a% be found in the Philippines, at the election of the petitioner.B2CIn

the instant case, herein respondent Rita is found to reside in Tun5ao, 7utuan !it% for 3ore than si>

3onths prior to the date of filin5 of the petitionA thus, the RT!, clearl% has @urisdiction over the

respondentJs petition belo#."urther3ore, the RT! also ac8uired @urisdiction over the persons of both

parties, considerin5 that su33ons and a cop% of the co3plaint #ith its anne>es #ere served upon the

herein petitioner on Dece3ber '2, &((( and that the herein petitioner filed his ns#er to the

!o3plaint on $anuar% 4, &(('.B)CThus, #ithout doubt, the RT!, #hich has rendered the 8uestioned@ud53ent, has @urisdiction over the co3plaint and the persons of the parties.

"ro3 the aforecited facts, the 8uestioned October '(, &(() @ud53ent of the trial court is clearl% not

void ab initio, since it #as rendered #ithin the a3bit of the courtJs @urisdiction. 7ein5 such, the sa3e

cannot an%3ore be disturbed, even if the 3odification is 3eant to correct #hat 3a% be considered an

erroneous conclusion of fact or la#.B+CIn fact, #e have ruled that for BasC lon5 as the public

respondent acted #ith @urisdiction, an% error co33itted b% hi3 or it in the e>ercise thereof #ill a3ount

to nothin5 3ore than an error of @ud53ent #hich 3a% be revie#ed or corrected onl% b% appeal.

B*C0rantin5 #ithout ad3ittin5 that the RT!Js @ud53ent dated October '(, &(() #as erroneous, the

petitionerJs re3ed% should be an appeal filed #ithin the re5le3entar% period. Knfortunatel%, the

petitioner failed to do this. He has alread% lost the chance to 8uestion the trial courtJs decision, #hich

has beco3e i33utable and unalterable. ;hat #e can onl% do is to clarif% the ver% 8uestion raised

belo# and nothin5 3ore.

"or our convenience, the follo#in5 3atters cannot an%3ore be disturbed since the October '(, &(()

@ud53ent has alread% beco3e i33utable and unalterable, to #it?

-a The findin5 that the petitioner is the offendin5 spouse since he cohabited #ith a #o3an #ho is not

his #ifeAB1C
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-b The trial courtJs 5rant of the petition for le5al separation of respondent RitaAB4C

-c The dissolution and li8uidation of the con@u5al partnershipAB2(C

-d The forfeiture of the petitionerJs ri5ht to an% share of the net profits earned b% the con@u5al

partnershipAB2'C

-e The a#ard to the innocent spouse of the 3inor childrenJs custod%AB2&C

-f The dis8ualification of the offendin5 spouse fro3 inheritin5 fro3 the innocent spouse b% intestate

successionAB2C

-5 The revocation of provisions in favor of the offendin5 spouse 3ade in the #ill of the innocent

spouseAB22C

-h The holdin5 that the propert% relation of the parties is con@u5al partnership of 5ains and pursuant to

rticle ''+ of the "a3il% !ode, all properties ac8uired durin5 the 3arria5e, #hether ac8uired b% one

or both spouses, is presu3ed to be con@u5al unless the contrar% is provedAB2)C

-i The findin5 that the spouses ac8uired their real and personal properties #hile the% #ere livin5

to5etherAB2+C

-@ The list of properties #hich Ri6al !o33ercial 7an:in5 !orporation -R!7! foreclosedAB2*C

-: The list of the re3ainin5 properties of the couple #hich 3ust be dissolved and li8uidated and the

fact that respondent Rita #as the one #ho too: char5e of the ad3inistration of these propertiesAB21C

-l The holdin5 that the con@u5al partnership shall be liable to 3atters included under rticle '&' of the

"a3il% !ode and the con@u5al liabilities totalin5 P)(,1+&.'( shall be char5ed to the inco3e

5enerated b% these propertiesAB24C

-3 The fact that the trial court had no #a% of :no#in5 #hether the petitioner had separate properties
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#hich can satisf% his share for the support of the fa3il%AB)(C

-n The holdin5 that the applicable la# in this case is rticle '&4-*AB)'C

-o The rulin5 that the re3ainin5 properties not sub@ect to an% encu3brance shall therefore be divided

e8uall% bet#een the petitioner and the respondent #ithout pre@udice to the childrenJs le5iti3eAB)&C

-p The holdin5 that the petitionerJs share of the net profits earned b% the con@u5al partnership is

forfeited in favor of the co33on childrenAB)Cand

-8 The order to the petitioner to rei3burse the respondents the su3 of P'4,(((.(( as attorne%Js fees

and liti5ation e>penses of P),(((.((.B)2C

fter discussin5 len5thil% the i33utabilit% of the Decision dated October '(, &((), #e #ill discuss the

follo#in5 issues for the enli5hten3ent of the parties and the public at lar5e.

Art$+e 129 o t'e -)m$& Co%e )pp$e" to t'e pre"e*t+)"e "$*+e t'e p)rt$e"> propert& re)t$o* $" ;o?er*e%b& t'e "&"tem o re)t$?e +omm#*$t& or +o*@#;)

p)rt*er"'$p o ;)$*".

The petitioner clai3s that the court a quo is #ron5 #hen it applied rticle '&4 of the "a3il% !ode,

instead of rticle '(&. He confusin5l% ar5ues that rticle '(& applies because there is no other

provision under the "a3il% !ode #hich defines net profits earned sub@ect of forfeiture as a result of

le5al separation.

Offhand, the trial courtJs Decision dated October '(, &(() held that rticle '&4-* of the "a3il% !odeapplies in this case. ;e a5ree #ith the trial courtJs holdin5.

First, let us deter3ine #hat 5overns the coupleJs propert% relation. "ro3 the record, #e can deduce

that the petitioner and the respondent tied the 3arital :not on $anuar% +, '4**. Since at the ti3e of the

e>chan5e of 3arital vo#s, the operative la# #as the !ivil !ode of the Philippines -R.. No. 1+ and


19/72

since the% did not a5ree on a 3arria5e settle3ent, the propert% relations bet#een the petitioner and

the respondent is the s%ste3 of relative co33unit% or con@u5al partnership of 5ains.B))Crticle ''4 of

the !ivil !ode provides?

rt. ''4. The future spouses 3a% in the 3arria5e settle3ents a5ree upon absolute orrelative co33unit% of propert%, or upon co3plete separation of propert%, or upon an%other re5i3e.In the absence of 3arria5e settle3ents, or #hen the sa3e are void, thes%ste3 of relative co33unit% or con@u5al partnership of 5ains as established in this!ode, shall 5overn the propert% relations bet#een husband and #ife.

Thus, fro3 the fore5oin5 facts and la#, it is clear that #hat 5overns the propert% relations of the

petitioner and of the respondent is con@u5al partnership of 5ains. nd under this propert% relation, the

husband and the #ife place in a co33on fund the fruits of their separate propert% and the inco3e

fro3 their #or: or industr%.B)+CThe husband and #ife also o#n in co33on all the propert% of the

con@u5al partnership of 5ains.B)*C

Second, since at the ti3e of the dissolution of the petitioner and the respondentJs 3arria5e the

operative la# is alread% the "a3il% !ode, the sa3e applies in the instant case and the applicable la#

in so far as the li8uidation of the con@u5al partnership assets and liabilities is concerned is rticle '&4

of the "a3il% !ode in relation to rticle +-& of the "a3il% !ode. The latter provision is applicable

because accordin5 to rticle &)+ of the "a3il% !ode BtChis !ode shall have retroactive effect insofar asit does not pre@udice or i3pair vested or ac8uired ri5hts in accordance #ith the !ivil !ode or other la#.

B)1C

No#, the petitioner as:s? ;as his vested ri5ht over half of the co33on properties of the con@u5al

partnership violated #hen the trial court forfeited the3 in favor of his children pursuant to rticles +-&

and '&4 of the "a3il% !odeG

;e respond in the ne5ative.

Indeed, the petitioner clai3s that his vested ri5hts have been i3paired, ar5uin5? s earlier adverted to,

the petitioner ac8uired vested ri5hts over half of the con@u5al properties, the sa3e bein5 o#ned in

co33on b% the spouses. If the provisions of the "a3il% !ode are to be 5iven retroactive application to

the point of authori6in5 the forfeiture of the petitionerJs share in the net re3ainder of the con@u5al


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partnership properties, the sa3e i3pairs his ri5hts ac8uired prior to the effectivit% of the "a3il% !ode.

B)4CIn other #ords, the petitioner is sa%in5 that since the propert% relations bet#een the spouses is

5overned b% the re5i3e of !on@u5al Partnership of 0ains under the !ivil !ode, the petitioner ac8uired

vested ri5hts over half of the properties of the !on@u5al Partnership of 0ains, pursuant to rticle '2 of

the !ivil !ode, #hich provides? ll propert% of the con@u5al partnership of 5ains is o#ned in co33on

b% the husband and #ife.B+(CThus, since he is one of the o#ners of the properties covered b% the

con@u5al partnership of 5ains, he has a vested ri5ht over half of the said properties, even after the

pro3ul5ation of the "a3il% !odeA and he insisted that no provision under the "a3il% !ode 3a%

deprive hi3 of this vested ri5ht b% virtue of rticle &)+ of the "a3il% !ode #hich prohibits retroactive

application of the "a3il% !ode #hen it #ill pre@udice a personJs vested ri5ht.

Ho#ever, the petitionerJs clai3 of vested ri5ht is not one #hich is #ritten on stone. In o, Jr. v. Courtof Appeals,B+'C#e define and e>plained vested ri5ht in the follo#in5 3anner?

vested ri5ht is one #hose e>istence, effectivit% and e>tent do not depend upon eventsforei5n to the #ill of the holder, or to the e>ercise of #hich no obstacle e>ists, and #hichis i33ediate and perfect in itself and not dependent upon a contin5enc%. The ter3vested ri5ht e>presses the concept of present fi>ed interest #hich, in ri5ht reason andnatural @ustice, should be protected a5ainst arbitrar% State action, or an innatel% @ustand i3perative ri5ht #hich enli5htened free societ%, sensitive to inherent andirrefra5able individual ri5hts, cannot den%.

To be vested, a ri5ht 3ust have beco3e a titlele5al or e8uitableto the present or futureen@o%3ent of propert%.B+&C-!itations o3itted

In our en bancResolution dated October '1, &(() forA!A"A#A uro Party $ist %fficer Samson S.

Alcantara, et al. v. &he 'on. ()ecutive Secretary (duardo *. (rmita,B+C#e also e>plained?The concept of vested ri5ht is a conse8uence of the +o*"t$t#t$o*) ;#)r)*t& o

%#e pro+e""that e>presses a present fi>ed interest #hich in ri5ht reason and natural@ustice is protected a5ainst arbitrar% state actionA it includes not onl% le5al or e8uitabletitle to the enforce3ent of a de3and but also e>e3ptions fro3 ne# obli5ations created

after the ri5ht has beco3e vested.Ri5hts are considered vested #hen the ri5ht toen@o%3ent is a present interest, absolute, unconditional, and perfect or fi>ed andirrefutable.B+2C-3phasis and underscorin5 supplied

"ro3 the fore5oin5, it is clear that #hile one 3a% not be deprived of his vested ri5ht, he 3a% lose the

sa3e if there is due process and such deprivation is founded in la# and @urisprudence.
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In the present case, the petitioner #as accorded his ri5ht to due process. First,he #as #ell/a#are that

the respondent pra%ed in her co3plaint that all of the con@u5al properties be a#arded to her.B+)CIn

fact, in his ns#er, the petitioner pra%ed that the trial court divide the co33unit% assets bet#een the

petitioner and the respondent as circu3stances and evidence #arrant after the accountin5 and

inventor% of all the co33unit% properties of the parties.B++C Second,#hen the Decision dated October

'(, &(() #as pro3ul5ated, the petitioner never 8uestioned the trial courtJs rulin5 forfeitin5 #hat the

trial court ter3ed as net profits, pursuant to rticle '&4-* of the "a3il% !ode.B+*CThus, the petitioner

cannot clai3 bein5 deprived of his ri5ht to due process.

"urther3ore, #e ta:e note that the alle5ed deprivation of the petitionerJs vested ri5ht is one founded,

not onl% in the provisions of the "a3il% !ode, but in rticle '*+ of the !ivil !ode. This provision is li:e

rticles + and '&4 of the "a3il% !ode on the forfeiture of the 5uilt% spouseJs share in the con@u5alpartnership profits. The said provision sa%s?

rt. '*+. In case of le5al separation, the 5uilt% spouse shall forfeit his or her share ofthe con@u5al partnership profits, #hich shall be a#arded to the children of both, and thechildren of the 5uilt% spouse had b% a prior 3arria5e. Ho#ever, if the con@u5alpartnership propert% ca3e 3ostl% or entirel% fro3 the #or: or industr%, or fro3 the#a5es and salaries, or fro3 the fruits of the separate propert% of the 5uilt% spouse, thisforfeiture shall not appl%.In case there are no children, the innocent spouse shall be entitled to all the net profits.

"ro3 the fore5oin5, the petitionerJs clai3 of a vested ri5ht has no basis considerin5 that even under

rticle '*+ of the !ivil !ode, his share of the con@u5al partnership profits 3a% be forfeited if he is the

5uilt% part% in a le5al separation case. Thus, after trial and after the petitioner #as 5iven the chance to

present his evidence, the petitionerJs vested ri5ht clai3 3a% in fact be set aside under the !ivil !ode

since the trial court found hi3 the 5uilt% part%.

More, inAbalos v. #r. +acatanay, Jr.,B+1C#e reiterated our lon5/standin5 rulin5 that?

BPCrior to the li8uidation of the con@u5al partnership, the interest of each spouse in thecon@u5al assets is inchoate, a 3ere e>pectanc%, #hich constitutes neither a le5al nor ane8uitable estate, and does not ripen into title until it appears that there are assets in theco33unit% as a result of the li8uidation and settle3ent. The interest of each spouse isli3ited to the net re3ainder orremanente liquido-haber anancial resultin5 fro3 theli8uidation of the affairs of the partnership after its dissolution. Thus, the ri5ht of thehusband or #ife to one/half of the con@u5al assets does not vest until the


22/72

dissolution and li8uidation of the con@u5al partnership, or after dissolution of the3arria5e, #hen it is finall% deter3ined that, after settle3ent of con@u5al obli5ations,there are net assets left #hich can be divided bet#een the spouses or their respectiveheirs.B+4C-!itations o3itted

"inall%, as earlier discussed, the trial court has alread% decided in its Decision dated October '(, &(()that the applicable la# in this case is rticle '&4-* of the "a3il% !ode.B*(C The petitioner did not file a

3otion for reconsideration nor a notice of appeal. Thus, the petitioner is no# precluded fro3

8uestionin5 the trial courtJs decision since it has beco3e final and e>ecutor%. The doctrine of

i33utabilit% and unalterabilit% of a final @ud53ent prevents us fro3 disturbin5 the Decision dated

October '(, &(() because final and e>ecutor% decisions can no lon5er be revie#ed nor reversed b%

this !ourt.B*'C

"ro3 the above discussions, rticle '&4 of the "a3il% !ode clearl% applies to the present case since

the partiesJ propert% relation is 5overned b% the s%ste3 of relative co33unit% or con@u5al partnership

of 5ains and since the trial courtJs Decision has attained finalit% and i33utabilit%.

T'e *et pro$t" o t'e +o*@#;) p)rt*er"'$p o ;)$*")re ) t'e r#$t" o t'e "ep)r)te propert$e" o t'e"po#"e" )*% t'e pro%#+t" o t'e$r )bor )*% $*%#"tr&.

The petitioner in8uires fro3 us the 3eanin5 of net profits earned b% the con@u5al partnership for

purposes of effectin5 the forfeiture authori6ed under rticle + of the "a3il% !ode. He insists that

since there is no other provision under the "a3il% !ode, #hich defines net profits earned sub@ect of

forfeiture as a result of le5al separation, then rticle '(& of the "a3il% !ode applies.

;hat does rticle '(& of the "a3il% !ode sa%G Is the co3putation of net profits earned in the con@u5al

partnership of 5ains the sa3e #ith the co3putation of net profits earned in the absolute co33unit%G

No#, #e clarif%.

"irst and fore3ost, #e 3ust distin5uish bet#een the applicable la# as to the propert% relations

bet#een the parties and the applicable la# as to the definition of net profits. s earlier discussed,

rticle '&4 of the "a3il% !ode applies as to the propert% relations of the parties. In other #ords, the
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co3putation and the succession of events #ill follo# the provisions under rticle '&4 of the said !ode.

Moreover, as to the definition of net profits, #e cannot but refer to rticle '(&-2 of the "a3il% !ode,

since it e>pressl% provides that for purposes of co3putin5 the net profits sub@ect to forfeiture under

rticle 2, No. -& and rticle +, No. -&, rticle '(&-2 applies. In this provision, net profits shall be

the increase in value bet#een the 3ar:et value of the co33unit% propert% at the ti3e of the

celebration of the 3arria5e and the 3ar:et value at the ti3e of its dissolution.B*&CThus, #ithout an%

iota of doubt, rticle '(&-2 applies to both the dissolution of the absolute co33unit% re5i3e under

rticle '(& of the "a3il% !ode, and to the dissolution of the con@u5al partnership re5i3e under rticle

'&4 of the "a3il% !ode. ;here lies the differenceG s earlier sho#n, the difference lies in the

processes used under the dissolution of the absolute co33unit% re5i3e under rticle '(& of the

"a3il% !ode, and in the processes used under the dissolution of the con@u5al partnership re5i3e

under rticle '&4 of the "a3il% !ode.

=et us no# discuss the difference in the processes bet#een the absolute co33unit% re5i3e and the

con@u5al partnership re5i3e.

On bsolute !o33unit% Re5i3e?

;hen a couple enters into a re;$me o )b"o#te +omm#*$t&, the husband and the #ife beco3es

@oint o#ners of all the properties of the 3arria5e. ;hatever propert% each spouse brin5s into the

3arria5e, and those ac8uired durin5 the 3arria5e -e>cept those e>cluded under rticle 4& of the

"a3il% !ode for3 the co33on 3ass of the coupleJs properties. nd #hen the coupleJs 3arria5e or

co33unit% is dissolved, that co33on 3ass is divided bet#een the spouses, or their respective heirs,

e8uall% or in the proportion the parties have established, irrespective of the value each one 3a% have

ori5inall% o#ned.B*C

Knder rticle '(& of the "a3il% !ode, upon dissolution of 3arria5e, an inventor% is prepared, listin5

separatel% all the properties of the absolute co33unit% and the e>clusive properties of eachA then the

debts and obli5ations of the absolute co33unit% are paid out of the absolute co33unit%Js assets and

if the co33unit%Js properties are insufficient, the separate properties of each of the couple #ill be

solidaril% liable for the unpaid balance. ;hatever is left of the separate properties #ill be delivered to

each of the3. The net re3ainder of the absolute co33unit% is its net assets, #hich shall be divided
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bet#een the husband and the #ifeA and for purposes of co3putin5 the net profits sub@ect to forfeiture,

said profits shall be the increase in value bet#een the 3ar:et value of the co33unit% propert% at the

ti3e of the celebration of the 3arria5e and the 3ar:et value at the ti3e of its dissolution.B*2C

ppl%in5 rticle '(& of the "a3il% !ode, the net profits re8uires that #e first find the 3ar:et value of

the properties at the ti3e of the co33unit%Js dissolution. "ro3 the totalit% of the 3ar:et value of all the

properties, #e subtract the debts and obli5ations of the absolute co33unit% and this result to the net

assets or net re3ainder of the properties of the absolute co33unit%, fro3 #hich #e deduct the 3ar:et

value of the properties at the ti3e of 3arria5e, #hich then results to the net profits.B*)C

0rantin5 #ithout ad3ittin5 that rticle '(& applies to the instant case, let us see #hat #ill happen if #e

appl% rticle '(&?

-a ccordin5 to the trial courtJs findin5 of facts, both husband and #ife have no separate properties,

thus, the re3ainin5 properties in the list above are all part of the absolute co33unit%. nd its 3ar:et

value at the ti3e of the dissolution of the absolute co33unit% constitutes the 3ar:et value at

dissolution.

-b Thus, #hen the petitioner and the respondent finall% #ere le5all% separated, all the properties

#hich re3ained #ill be liable for the debts and obli5ations of the co33unit%. Such debts and

obli5ations #ill be subtracted fro3 the 3ar:et value at dissolution.

-c ;hat re3ains after the debts and obli5ations have been paid fro3 the total assets of the absolute

co33unit% constitutes the net re3ainder or net asset. nd fro3 such net assetre3ainder of the

petitioner and respondentJs re3ainin5 properties, the 3ar:et value at the ti3e of 3arria5e #ill be

subtracted and the resultin5 totalit% constitutes the net profits.

-d S$*+e bot' '#"b)*% )*% =$e ')?e *o "ep)r)te propert$e",and nothin5 #ould be returned to

each of the3, #hat #ill be divided e8uall% bet#een the3 is si3pl% the net profits. Ho#ever, in the

Decision dated October '(, &((), the trial court forfeited the half/share of the petitioner in favor of his

children. Thus, if #e use rticle '(& in the instant case -#hich should not be the case, nothin5 is left

to the petitioner since both parties entered into their 3arria5e #ithout bri

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