Digest by Louise Alexandra Dia
Graphics by Elijah Christiane M. Fajardo
FACTS: Respondents Spouses Jorge and Hilaria Escalona were married on November 14, 1960. Thereafter, they acquired parcels of land identified as Lot Nos. 1 and 2. On June 16, 1998, Jorge waived his right over Lot No. 1 in favor of his illegitimate son, Reygan Escalona, who relinquished his right to petitioner Belinda Alexander. On August 10, 2005, Reygan and Belinda entered into a Deed of Absolute Sale covering Lot Nos. 1 and 2.
Spouses Escalona confronted Belinda and explained that Reygan cannot validly sell the lots. Belinda invoked the legitimacy of her contracts with Regyan. Spouses Escalona filed a complaint for annulment of documents with damages against Belinda and Reygan before the RTC. They averred that they never transferred Lot No. 2 to a third person but Reygan fraudulently sold the lot to Belinda. Hilaria also did not consent to the waiver of rights over Lot No. 1 and the transaction was not meant to convey ownership to Reygan.
Belinda sought the dismissal of the case on the grounds of laches and prescription. She argued that she was a buyer in good faith and that Jorge’s waiver of rights in favor of Reygan was unconditional.
ISSUE: Whether or not Jorge’s alienation of Lot No. 1 is void because it was made without the consent of his wife, Hilaria.
RULING: YES. Jorge’s alienation of Lot No. 1 is void under Article 124 of the Family Code because it was made without Hilaria’s consent.
Article 124 of the Family Code provides that any alienation or encumbrance of the conjugal property concluded after the effectivity of the Code requires a court authority or the written consent of the other spouse. Otherwise, the disposition is void.
In this case, the contract is void notwithstanding the fact that Spouses Escalona were married during the effectivity of the Civil Code. The Family Code expressly repealed Title VI, Book I of the Civil Code on Property Relations between Husband and Wife. The Family Code has a retroactive effect to existing conjugal partnerships without prejudice to vested rights as provided under Articles 105, 254, 255, and 256 therein.
In Spouses Cueno v. Spouses Bautista, the Court En Banc held that the sale of conjugal property without the consent of the wife is merely voidable and has been modified.
At this juncture, the Court holds that more than the date of the marriage of the spouses, the applicable law must be reckoned on the date of the alienation or encumbrance of the conjugal property made without the consent of the other spouse, to wit:
1. The alienation or encumbrance of the conjugal property, without the wife’s consent, made BEFORE the effectivity of the Family Code, is not void but merely voidable.
The applicable laws are Articles 166 and 173 of the Civil Code. The wife may file an action for annulment of contract within 10 years from the transaction; and
2. The alienation or encumbrance of the conjugal property, without the authority of the court or the written consent of the other spouse, made AFTER the effectivity of the Family Code is void.
The applicable law is Article 124 of the Family Code without prejudice to vested rights in the property acquired before August 3, 1988. Unless the transaction is accepted by the non-consenting spouse or is authorized by the court, an action for declaration of nullity of the contract may be filed before the continuing offer on the part of the consenting spouse and the third person becomes ineffective.
To end, it is the duty of the Court to rationalize various rulings interpreting a statute in the interest of harmony of laws and stability of jurisprudence. This case did not abandon but clarified Cueno with the current state of case law. The discussions herein shall guide the Bench and the Bar as to the status of a contract and the prescriptive period of an action in transactions involving the alienation or encumbrance of the conjugal property made without consent of the other spouse.
THE BARRISTER 