JERICHO DIEGO G.

MASUKAT-1T
Art. 119. Whenever an amount or credit payable within a period of time belongs to one of the spouses,
the sums which may be collected during the marriage in partial payments or by installments on the
principal shall be the exclusive property of the spouse. However, interests falling due during the
marriage on the principal shall belong to the conjugal partnership. (156a, 157a)
*Payment of credit in favor of spouse-in a situation where one of the spouses has in his favor a credit
payable in installment or, in any case, a credit which will be fully paid during the marriage, all
payments made on the principal during that marriage shall belong exclusively to the spouse who owns
the credit. Interest on the principal falling due during marriage shall belong to the conjugal property
and is, therefore, included under Article 117(3). (emphasize the deliberation of the civil code with
respect to this article)
Art. 120. The ownership of improvements, whether for utility or adornment, 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 shall pertain to the conjugal partnership or to the original owner-spouse, subject to the
following rules:
When the cost of the improvement made by the conjugal partnership and any resulting increase in
value are more than the value of he property at the time of the improvement, the entire property of one
of the spouse shall belong to the conjugal partnership, subject to reimbursement of the value of the
property of the owner-spouse at the time of the improvement; otherwise, said property shall be
retained in ownership by the owner-spouse, likewise subject to reimbursement of the cause of the
improvement.
In either case, the ownership of the entire property shall be vested upon the reimbursement, which
shall be made at the time of the liquidation of the conjugal partnership. (158a)
*Source of funds used for improvements-if the value of the improvement and any resulting increase in
value are more than the value of the separate property at the time of improvement, the entire property
of one of the spouses shall belong to the conjugal property. But ownership shall vest only upon
reimbursement to the owner-spouse, which shall be made at the time of the liquidation of the conjugal
partnership. Proof, therefore, is needful of the making or construction of the improvements and the
source of improvements belonging to the conjugal partnership or to one spouse separately
Villanueva vs. IAC
GR No. 67582, October 29, 1987
FACTS:
Modesto Aranas, husband of Victoria, inherited a land from his father. Dorothea and Teodoro,
Modestos illegitimate children, borrowed money from private respondent Jesus Bernas, mortgaging
as collateral their fathers property. In the loan agreement, Aranas described themselves as the
absolute co-owners. Dorothea and Teodoro failed to pay the loan resulting to extrajudicial foreclosure
of mortgage in 1977 and thereafter Bernas acquired the land as the highest bidder. Aftewards, the
Aranases executed a deed of extrajudicial partition in 1978, in which they adjudicated the same land
unto themselves in equal share pro-indiviso. Bernas then consolidated his ownership over the lot
when the mortgagors failed to redeem it withn the reglementary period, and had the title in the name
of Modesto cancelled and another TCT issued in his name.
In 1978, petitioner Consolacion Villanueva and Raymundo Aranas filed a complaint against
respondents spouses Jesus and Remedios Bernas, for the cancellation of the TCT under the name of
the Bernases, and they be declared co-owners of the land. Petitioner alleged that spouses Modesto
and Victoria in 1987 and 1958 executed 2 separate wills: first bequeathing to Consolacion and

Raymundo and to Dorothea and Teodoro, in equal shares pro diviso, all of said Victorias shares from
the conjugal partnership property; and second Modestos interests in his conjugal partnership with
Victoria as well as his separate properties bequeathed to Dorothea and Teodoro. Trial court dismissed
the complaint, declaring herein respondents as the legal owners of the disputed property. IAC likewise
affirmed the lower courts decision.
ISSUE: WON Villanueva had a right over the land and the improvements thereon made by Victoria
who rendered the lot as conjugal property.
HELD: The land was not a conjugal partnership property of Victoria and Modesto. It was Modestos
exclusive property since he inherited it from his parents. Moreover, since Victoria died ahead of
Modesto, Victoria did not inherit said lot from him and therefore had nothing of the land to bequeath by
will of otherwise to Consolacion.
Article 158 of the Civil Code says that improvements, whether for utility or adornment made on the
separate property of the spouses through advancements from the partnership or through the industry
of either spouse belong to the conjugal partnership, and buildings constructed at the expense of the
partnership during the marriage on land belonging to one of the spouses also pertain to the
partnership, but the value of the land shall be reimbursed to the spouse who owns the same.
There was no proof presented by Villanueva. Such proof is needed at the time of the making or
construction of the improvements and the source of the funds used thereof in order to determine the
character of the improvements as belonging to the conjugal partnership or to one spouse separately.
What is certain is that the land on which the improvements stand was the exclusive property of
Modesto and that where the property is registered in the name of one spouse only and there is no
showing of when precisely the property was acquired, the presumption is that is belongs exclusively to
said spouse. It is not therefore possible to declare the improvements to be conjugal in character.
Furthermore, Bernas mode of acquisition of ownership over the property appears in all respect to be
regular, untainted by any defect whatsoever. Bernas must therefore be deemed to have acquired
indefeasible and clear title to the lot, which cannot be defeated or negated by claims subsequently
arising and of which he had no knowledge or means of knowing prior to their assertion and
ventilation.
*What is usufruct? The legal right of using and enjoying the fruits or profits of something belonging to
another
*Usufructuary- Prior to reimbursement at the time of liquidation. The conjugal partnership may
use both the land and the improvement, but it does so not as owner but in the exercise of a
usufruct. The ownership of the land remains the same until the value of the land is paid, and this
payment can only be demanded in the liquidation of the partnership. Hence, prior to liquidation,
the owner-spouse still owns her separate property and, therefore, the same cannot be levied
upon to satisfy a conjugal debt like (maramba v. Lozano (digest)), unless the conjugal debts, in
which case the separate property can be held solidarily liable.
*If no reimbursement is made, the ownership of the property shall be retained by the ownerspouse, likewise subject to reimbursement of the cost of the improvement, the entire
improvement shall belong to the owner-spouse subject to reimbursement at the time of liquidation
in favor of the conjugal partnership.
In the case of In re Padilla, it is stated that the ownership of the land is retained by the wife until she is
paid the value of the lot, as a result of the liquidation of the conjugal partnership. The mere
construction of a building from common funds does not automatically convey the ownership of the
wifes land to the conjugal partnership. Such a mode of using the land, namely, by erecting a building
thereon, is simply an exercise of the right of usufruct pertaining to the conjugal partnership over the
wifes land. In consequence of this usufructuary right, the conjugal partnership is not bound to pay any

rent during the occupation of the wifes land because if the lot were leased to a third person, instead of
being occupied by the new construction from the partnership funds, the rent from the third person
would belong to the conjugal partnership. Therefore, before payment of the value of the land is made
from common funds, inasmuch as the owner of the land is the wife, all the increase or decrease in its
value must be for her benefit or loss. And when may she demand payment? Not until the liquidation of
the conjugal partnership because up to that time, it is neither necessary nor appropriate to transfer to
the partnership the dominion over the land, which is lawfully held in usufruct by the conjugal
partnership during the marriage.
*Computation- Justice Puno offered a sample computation of how the second paragraph shall operate
The building is worth
The land is worth
The total is

p 50, 000
p 100,000
p 150,000

The value of house and lot as a result

Of the improvement is
p 180,000
That the plus value is
p 30,000
The cost of the building
Plus the plus value of
The total value of the
Improvement is

p 50,000
p 30,000
p 80,000

Since the cost of the land is still more than the value of the improvement, it would still be a case of
ordinary accession.

Art. 121. The conjugal partnership shall be liable for:

(1) The support of the spouse, their common children, and the legitimate children of either
spouse; however, the support of illegitimate children shall be governed by the provisions of this Code
on Support;
(2) All debts and obligations contracted during the marriage by the designated administrator-spouse
for the benefit of the conjugal partnership of gains, or by both spouses or by one of them with the
consent of the other;
(3) Debts and obligations contracted by either spouse without the consent of the other to the extent
that the family may have benefited;
(4) All taxes, liens, charges, and expenses, including major or minor repairs upon the conjugal
partnership property;
(5) All taxes and expenses for mere preservation made during the marriage upon the separate
property of either spouse;
(6) Expenses to enable either spouse to commence or complete a professional, vocational, or other
activity for self-improvement;
(7) Ante-nuptial debts of either spouse insofar as they have redounded to the benefit of the family;
(8) The value of what is donated or promised by both spouses in favor of their common legitimate
children for the exclusive purpose of commencing or completing a professional or vocational course or
other activity for self-improvement; and
(9) Expenses of litigation between the spouses unless the suit is found to groundless.
If the conjugal partnership is insufficient to cover the foregoing liabilities, the spouses shall be solidarily
liable for the unpaid balance with their separate properties. (161a)
(Same explanation with article 94 but this one talks about conjugal partnership while the former talks
about absolute community. Emphasis is not needed)

Charges and Obligations-Except for the support of illegitimate children and liabilities for fines and
pecuniary indemnities arising from crime or quasi-delict which are contained in Item number 9 of
Article 94 and which have been incorporated in a separate Article 122 with respect to the conjugal
partnership of gains, the liabilities of the conjugal partnership of gains enumerated in Article 121
are the same as those enumerated in Article 94 of the Family Code relative to the liabilities of the
absolute community of property. Hence, the explanations are the same.
Liabilities shall only be chargeable to the conjugal partnership if it benefits the same. This rule
highlights the underlying concern of the law for the conservation of the conjugal partnership.
When making reference to any advantage or benefit to the family, the law interchangeably uses
the phrase redounded to the benefit of, benefited from, and for the benefit of. These phrases
all mean the same thing. The burden of proof that a debt was contracted for the benefit of the
conjugal partnership lies with the creditor. The benefit must be a direct result of the obligation. It
cannot simply be a by-product or a spin-off of the obligation or loan itself. Hence, indirect benefits
that might accrue to a husband in his signing a surety or guarantee agreement not in favor of the
family but in favor of his employer-corporation, such as the possibility of prolonging his
employment or of increasing the value of the shares of stock of some members of the family in
the corporation in case of rehabilitation, and enhancing his prestige in the corporation, are not the
benefits that can be considered as giving a direct advantage accruing to the family. Hence, the
creditors cannot go against the conjugal partnership property of the husband in satisfying the
obligation subject of the surety agreement. A contrary view would put in peril the conjugal
partnership property by allowing it to be given gratuitously as in cases of donation of conjugal
partnership property, which is prohibited.
Ayala Investments v. CA
FACTS:
Philippine Blooming Mills (PBM) obtained P50,300,000.00 loan from petitioner Ayala Investment
and Development Corporation (AIDC). Respondent Alfredo Ching, EVP of PBM, executed
security agreements on December 1980 and March 1981 making him jointly and severally
answerable with PBMs indebtedness to AIDC. PBM failed to pay the loan hence filing of
complaint against PBM and Ching. The RTC rendered judgment ordering PBM and Ching to
jointly and severally pay AIDC the principal amount with interests. Pending the appeal of the
judgment, RTC issued writ of execution. Thereafter, Magsajo, appointed deputy sheriff, caused
the issuance and service upon respondent spouses of the notice of sheriff sale on 3 of their
conjugal properties on May 1982. Respondent spouses filed injunction against petitioners on the
ground that subject loan did not redound to the benefit of the said conjugal partnership. CA
issued a TRP enjoining lower court from enforcing its order paving way for the scheduled auction
sale of respondent spouses conjugal properties. A certificate of sale was issued to AIDC, being
the only bidder and was registered on July 1982.
ISSUE: Whether or not the debts and obligations contracted by the husband alone is considered
for the benefit of the conjugal partnership and is it chargeable.
HELD:

The loan procured from AIDC was for the advancement and benefit of PBM and not for the
benefit of the conjugal partnership of Ching. Furthermore, AIDC failed to prove that Ching
contracted the debt for the benefit of the conjugal partnership of gains. PBM has a personality
distinct and separate from the family of Ching despite the fact that they happened to be
stockholders of said corporate entity. Clearly, the debt was a corporate debt and right of recourse
to Ching as surety is only to the extent of his corporate stockholdings.
Based from the foregoing jurisprudential rulings of the court, if the money or services are given to
another person or entity, and the husband acted only as a surety or guarantor, that contract
cannot, by itself, alone be categorized as falling within the context of obligations for the benefit of
the conjugal partnership. The contract of loan or services is clearly for the benefit of the principal
debtor and not for the surety or his family. Ching only signed as a surety for the loan contracted
with AIDC in behalf of PBM. Signing as a surety is certainly not an exercise of an industry or
profession, it is not embarking in a business. Hence, the conjugal partnership should not be
made liable for the surety agreement which was clearly for the benefit of PBM.
The court did not support the contention of the petitioner that a benefit for the family may have
resulted when the guarantee was in favor of Chings employment (prolonged tenure, appreciation
of shares of stocks, prestige enhanced) since the benefits contemplated in Art. 161 of the Civil
Code must be one directly resulting from the loan. It must not be a mere by product or a spin off
of the loan itself.
Obligation of husband and wife- the conjugal partnership property is also liable for all obligations
contracted by the husband and wife.

In the case of Carandang v Heirs of Quirino de Guzman, it is stated that when the spouses are
sued for the enforcement of the obligation entered into by them, they are being impleaded in their
capacity as representatives of the conjugal partnership and not as independent debtors. Hence,
either of them may be sued for the whole amount, similar to that of a solidary liability, although the
amount is chargeable against their conjugal partnership property.

Solidary obligation-If the conjugal partnership is insufficient to cover the debts and obligations
enumerated in Article 121, the creditors may demand payment from either or any of the spouses
with their respective separate properties. He or she who made the payment may claim from his or
her spouse only the share which corresponds to each, with the interest for the payment already
due. If the payment is made before the debt is due, no interest for the intervening period may be
demanded.
Insolvency of spouses-So long as the conjugal partnership subsists, its property shall not be
among the assets to be taken possession of by the assignee for the payment of the insolvent
debtors obligations, except insofar as the latter have redounded to the benefit of the family
Art. 122. The payment of personal debts contracted by the husband or the wife before or during the
marriage shall not be charged to the conjugal properties partnership except insofar as they redounded
to the benefit of the family.

Neither shall the fines and pecuniary indemnities imposed upon them be charged to the partnership.
However, the payment of personal debts contracted by either spouse before the marriage, that of fines
and indemnities imposed upon them, as well as the support of illegitimate children of either spouse,
may be enforced against the partnership assets after the responsibilities enumerated in the preceding
Article have been covered, if the spouse who is bound should have no exclusive property or if it should
be insufficient; but at the time of the liquidation of the partnership, such spouse shall be charged for
what has been paid for the purpose above-mentioned. (163a)
*Debts, fines, pecuniary indemnities incurred before or during the marriage- for as long as debts and
obligations redounded to the benefit of the family, such debts and obligations, such as hospital and
medical expenses of the spouses, may be charged to the conjugal partnership.
*For the third paragraph of article 122 to apply, it must be shown that the obligations under article 121
have been covered and that the debtor-spouse has insufficient or no exclusive properties to pay the
debt or obligation involved.
People vs Lagrimas
FACTS:
Froilan Lagrimas was charged for the murder of Pelagio Cagro. Thereafter, the heirs of Cagro filed a
motion for the issuance of a writ of preliminary attachment on the property of the accused, which was
granted. Lagrimas was convicted and sentenced to suffer the penalty of reclusion perpetua and to
indemnify the appellants. The judgment became final. The lower court issued a writ of execution to
cover the civil indemnity. A levy was had on the parcels of land declared for tax purposes in the name
of the accused and the sale thereof at public auction was scheduled. However, the wife of the
accused, Mercedes Lagrimas, filed a petition to quash the said attachment contending that the
property belonged to the conjugal partnership and could not be held liable for pecuniary indemnity the
husband was required to pay. Petition was granted. Another judge set aside the said order. But upon
Mercedes filing a motion for reconsideration, a third judge revived the original order, declaring such
attachment and the writ of execution thereafter issued null and void.
ISSUE:
WON properties from the conjugal properties of Mercedes and Froilan can be held liable for the
pecuniary indemnity incurred by the latter.
HELD:
Yes. Fines and indemnities imposed upon either husband or wife may be enforced against the
partnership assets after the responsibilities enumerated in article 161 have been covered, if the
spouse who is bound should have no exclusive property or if it should be insufficient.
It is quite plain; therefore, that the period during which such a liability may be enforced presupposes
that the conjugal partnership still exists for the law speaks of partnership assets. That upon
complying with the responsibilities enumerated in article 161, the fines and indemnities imposed upon
a party of the conjugal partnership will be satisfied. If the appealed order were to be upheld, Froilan
would be in effect exempt there from and the heirs of the offended party being made to suffer still
further; that for a transgression of the law by either husband or wife, the rest of the family may be
made to bear burdens of an extremely onerous character
*Difference from the absolute community- the conjugal partnership is liable for the personal debts,
fines and indemnities of either spouse only after payment of all the liabilities of the conjugal
partnership as enumerated under Article 121 are covered and when the separate property of the
spouse is insufficient. Under the absolute community regime, such liabilities may be charged against
the community only in case the separate property of the spouse is insufficient. The reason for this is
that in the absolute community regime, the spouses have fewer, if any at all, exclusive properties with
which to meet their personal obligations. Thus, it is no longer required that all the charges upon the

absolute community be satisfied before such personal obligations may be paid by the community
(CITE THE CASE OF Buado vs. CA)
*Personal obligations of spouses during the marriage- personal obligations of either of the spouses
incurred during the marriage, which do not redound to the benefit of the family or do not have the
consent of the other spouse shall be borne only by the spouse-debtor and his or her separate property
(cite the case of BA FINANCE CORP V. CA)
*Computation- refer to the sample computation given by Justice Caguiao during the 176 th joint meeting
of the civil code and family law commission.
Art. 123. Whatever may be lost during the marriage in any game of chance or in betting, sweepstakes,
or any other kind of gambling whether permitted or prohibited by law, shall be borne by the loser and
shall not be charged to the conjugal partnership but any winnings therefrom shall form part of the
conjugal partnership property. (164a)
Game of chance- the conjugal partnership property must not be put to useless risk precipitated by
highly speculative activities of any kind of the spouses. These activities include any game of chance,
betting, sweepstakes or any kind of gambling. If, however, a spouse undertakes such activities, his or
her winnings shall go to the conjugal partnership property while his or her losses shall not be
chargeable to the same. Winnings can be considered as income of the common property and income
of the separate property which, therefore, make them part of the conjugal partnership of gains.
Section 5. Administration of the
Conjugal Partnership Property
Art. 124. The administration and enjoyment of the conjugal partnership shall belong to both spouses
jointly. In case of disagreement, the husband's decision shall prevail, subject to recourse to the court
by the wife for proper remedy, which must be availed of within five years from the date of the contract
implementing such decision.
In the event that one spouse is incapacitated or otherwise unable to participate in the administration of
the conjugal properties, the other spouse may assume sole powers of administration. These powers
do not include disposition or encumbrance without authority of the court or the written consent of the
other spouse. In the absence of such authority or consent, the disposition or encumbrance shall be
void. However, the transaction shall be construed as a continuing offer on the part of the consenting
spouse and the third person, and may be perfected as a binding contract upon the acceptance by the
other spouse or authorization by the court before the offer is withdrawn by either or both offerors.
(165a)
Art. 125. Neither spouse may donate any conjugal partnership property without the consent of the
other. However, either spouse may, without the consent of the other, make moderate donations from
the conjugal partnership property for charity or on occasions of family rejoicing or family distress.
(174a)
*Identity of provisions- article 124 and 125 are exactly identical with article 96 and 98(explain
provisions). Hence, there application is the same. However, it must be importantly emphasized that, if
the marriage settlement provides for the conjugal partnership of gains as governing the property
relationship within a marriage but the same likewise stipulates that the sharing will not be equal upon
liquidation, such unequal sharing will not affect the joint administration of the spouses during the
marriage which places spouses in equal footing, unless otherwise agreed upon also in the marriage
settlement.

*Nature of proceedings- Summary procedure pursuant to Title XI (Articles 238 up to 253) of the
Family Code shall apply to the first paragraph of Article 124 involving the annulment of the
husbands decision in the administration and enjoyment of the conjugal property in case the
husbands decision is in conflict with the wifes decision.

Section 6. Dissolution of Conjugal Partnership Regime

H

Art. 126. The conjugal partnership terminates:

(1) Upon the death of either spouse;
(2) When there is a decree of legal separation;
(3) When the marriage is annulled or declared void;
or (4) In case of judicial separation of property during the marriage under Articles 134 to 138. (175a)
Termination of conjugal partnership- same application with article 99(explain provision).

Art. 127. The separation in fact between husband and wife shall not affect the regime of conjugal
partnership, except that:
(1) The spouse who leaves the conjugal home or refuses to live therein, without just cause, shall
not have the right to be supported;
(2)When the consent of one spouse to any transaction of the other is required by law, judicial
authorization shall be obtained in a summary proceeding;
(3) In the absence of sufficient conjugal partnership property, the separate property of both spouses
shall be solidarily liable for the support of the family. The spouse present shall, upon petition in a
summary proceeding, be given judicial authority to administer or encumber any specific separate
property of the other spouse and use the fruits or proceeds thereof to satisfy the latter's share. (178a)
*Effect of separation- the above-mentioned article provides for the effect of separation in fact between
husband and wife. Art 127 is exactly identical with art 100(explain provision). Hence, the explanation
made in the latter article is applicable to art 127. The spouse who unjustifiably leaves the home is not
entitled to support.
*As to paragraph 3 of art 127, it must be important to note that any debt incurred for the support of the
family is a liability of the conjugal partnership of gains. Hence, even if one of the spouses left the
conjugal home, with or without justifiable reasons, any debt incurred by any spouse for the benefit of
the family shall be chargeable to the community property. Their separation in fact will not justify nonliability of the community property
Garcia v. Cruz (DIGEST)
Art. 128. If a spouse without just cause abandons the other or fails to comply with his or her obligation
to the family, the aggrieved spouse may petition the court for receivership, for judicial separation of
property, or for authority to be the sole administrator of the conjugal partnership property, subject to
such precautionary conditions as the court may impose.
The obligations to the family mentioned in the preceding paragraph refer to marital, parental or
property relations.
A spouse is deemed to have abandoned the other when he or she has left the conjugal dwelling
without intention of returning. The spouse who has left the conjugal dwelling for a period of three

months or has failed within the same period to give any information as to his or her whereabouts shall
be prima facie presumed to have no intention of returning to the conjugal dwelling. (167a, 191a)
*Abandonment- same with article 101. Hence, application is the same. Article 128 and 101 gives an
aggrieved spouse, who is the co-owner of the property, the right to bring an action to protect his or her
interest and her right thereto even before the liquidation or dissolution of the conjugal partnership of
gains or the absolute community of property. (Cite the case of Enriquez v. CA)