Absolute Community of Property

Question 1

When shall the absolute community of property commence?

Answer 1

The absolute community of property between the spouses shall commence at the precise moment that the marriage is celebrated (Article 88, FC).

Question 2

May future spouses indicate in the marriage settlement that the absolute community of property shall begin after three years of marriage?

Answer 2

No, future spouses cannot provide that the absolute community property shall begin at another time. Under Article 88 of the Family Code, Any stipulation, express or implied, for the commencement of the community regime at any other time shall be void.

Question 3

Can a spouse waive his or her interest in the absolute community of property

Answer 3

No, a spouse cannot waive his or her interest in the absolute community of property. Under Article 89 of the Family Code, “No waiver of rights, interests, shares and effects of the absolute community of property during the marriage can be made except in case of judicial separation of property.”

Question 4

When can a spouse waive his or her right to the absolute community of property?

Answer 4

Under Article 89 of the Family Code, a spouse may waive his or her right, interest, shares and effects of the absolute community of property in case of judicial separation of property

Question 5

What shall form part of the absolute community of property?

Answer 5

The community property shall consist of all the property owned by the spouses at the time the celebration of the marriage or acquired thereafter (Article 91).

Except those provided by the Chapter on Absolute Community of Property in the Family Code. (see Article 92)

Question 6

What are excluded from the absolute community of property as provided under Article 92 of the Family Code?

Answer 6

Under Art 92 the following shall be excluded from the community property:

1. Property acquired DURING MARRIAGE by GRATUITOUS TITLE by either spouse, including the fruits and income arising from the property. UNLESS, the donor, testator, or grantor expressly provided that it shall be part of the community property.
2. Property for the personal and exclusive use of either spouse. BUT JEWELRY SHALL FORM PART of the community property.
3. Property ACQUIRED DURING A FORMER MARRIAGE WITH LEGITIMATE DESCENDANTS, including fruits and income.

Question 7

Shall inheritance granted to the spouse during marriage form part of the community property?

Answer 7

No, under Article 92 of the Family Code, property acquired during marriage by gratuitous title shall not form part of the community property unless it has been expressly provided by the testator.

Question 8

Marie inherited her lolo’s hacienda via a will five years after her wedding to John. Shall the profits from the harvest of the hacienda form part of Marie and John’s community property?

Answer 8

No, the profits are exclusively Marie’s property. Under Article 92 of the Family Code, property acquired during marriage, including its fruits and income, by gratuitous title by either spouse shall be excluded from the community property.

Question 9

Shall jewelry be excluded from the community property?

Answer 9

No, jewelry shall not be excluded from the community property. Under Article 92, although property for the personal and exclusive use of either spouse shall be excluded from the community property, jewelry, however, shall form part of the community property.

Question 10

What is the principle regarding property relations of the spouses?

Answer 10

The principle governing property relations of the spouses is that, under Article 93 of the Family Code, “Property acquired during the marriage is presumed to belong to the community, unless it is proved that it is one of those excluded therefrom.”

Question 11

For whose support shall the absolute community of property of the spouses be liable for?

Answer 11

Article 94 (1): The support of:

1. The spouses;
2. Common children;
3. Legitimate children of either spouse.

Question 12

Where shall the funds be sourced from if the absolute community of property is insufficient to settle the debt or obligation?

Answer 12

Article 94: If the community property is insufficient to cover the foregoing liabilities, except those under paragraph (9), the spouses shall be solidarily liable for the unpaid balance with their separate properties.

Question 13

What shall be covered by the absolute community property?

Answer 13

Under Article 49:

1. Family support;
2. Debts and obligations incurred during marriage by the administrator for the benefit of the family, or by both spouses, or by one spouse with the consent of the other;
3. Debts and obligations without consent but benefited the family;
4. Expenses upon the community property (repairs, taxes, etc.);
5. Expenses for mere preservation of each spouse’s exclusive property but used by the family (includes taxes);
6. Self improvement of either spouse (education, etc.)
7. Antenuptial debts that have benefited the family
8. For the education and self-improvement of the children;
9. Other liabilities like general antenuptial debts, support of the illegitimate children of either spouse, liabilities by one spouse arising from crime or quasi-delict, and debts by either spouse that cannot be afforded by their exclusive property;
10. Litigation expenses (unless the suit is groundless)

Question 14

Shall losses in gambling, bets, games of chance, etc. be debited from the absolute community of property?

Answer 14

No, losses arising from gambling cannot be debited from the absolute community of partnership. Under Article 95, “Whatever may be lost during the marriage in any game of chance, 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 community but any winnings therefrom shall form part of the community property.”

LOSSES: NOT CHARGE
WINNINGS: CREDITED

Question 15

To whom shall the administration and enjoyment of the community property belong?

Answer 15

The administration and enjoyment of the community property shall belong to both spouses jointly. (Art. 96 par. 1, FC)

Question 16

Whose decision shall prevail in case of disagreement?

Answer 16

In case of disagreement, the husband’s decision shall prevail, subject to recourse to the court by the wife for a proper remedy, which must be availed of within five years from the date of the contract implementing such decision. (Art. 96 par. 1, FC)

Question 17

When may a spouse exercise sole powers of administration of the community property?

Answer 17

The other spouse may assume sole powers of administration in the event that one spouse is incapacitated or otherwise unable to participate in the administration of the common properties (Art. 96, par. 2, FC).

Question 18

What are the limitations to the exercise of sole power of administration of the other spouses?

Answer 18

The sole powers of administration do not include the powers of disposition or encumbrance without the authority of the court or the written consent of the other spouse (Art. 96, par. 2, FC)

Question 19

What is necessary in order for the other spouse exercising sole powers of administration to be able to dispose or subject the community property to encumbrances?

Answer 19

It shall be necessary for the other spouse to:

1. Obtain the authority of the court; or
2. Obtain the written consent of the other spouse. (Art. 96 par. 2, FC)

Question 20

What is the effect on the sale or the encumbrance if consent or authority was not given?

Answer 20

The sale or the loan security shall be void in the absence of such authority or consent.

Under Article 96 par. 2: “In the absence of such authority or consent, the disposition or encumbrance shall be void.”

Question 21

How shall the disposition or encumbrance be treated despite being void?

Answer 21

The disposition or encumbrance, when the consent or authority is absent, shall be void but 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 offerrors. (Article 96 par. 2 FC)

Question 22

When may a transaction done by the other spouse exercising sole powers of administration but obtained without consent be perfected?

Answer 22

The transaction may be perfected as a binding contract:

1. Upon the acceptance by the other spouse; OR
2. Authorization by the court;
3. Provided that the acceptance or authorization is granted before the offer is withdrawn by either or both offerors.

Question 23

May either spouse dispose of his or her interest in the community property?

Answer 23

Yes, according to Article 97 of the Family Code, “Either spouse may dispose by will of his or her interest in the community property.”

Question 24

May either spouse donate any community property without the consent of the other? Is there an exception to this rule?

Answer 24

No, either spouse cannot donate any community property without obtaining the consent of the other but there is an exception to the rule. According to Article 98 of the Family Code, “Neither spouse may donate any community property without the consent of the other.

However, either spouse may, without the consent of the other, make moderate donations from the community property for charity or on occasions of family rejoicing or family distress.

Question 25

When shall the absolute community of property terminate?

Answer 25

Under Article 99 FC, The absolute community property 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;
4. In case of judicial separation of property during the marriage under Articles 134 to 138.

Question 26

Shall separation in fact between the husband and the wife affect the regime of absolute community?

Answer 26

No, under Article 100 FC, the separation in fact between husband and wife shall not affect the regime of absolute community 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 community property, the separate property of both spouses shall be solidarily liable for the support of the family. The spouse present shall, upon proper 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.

Question 27

When shall a spouse not be entitled for support?

Answer 27

The spouses shall not be entitled for support when he/she, without just cause:

1. Leaves the conjugal home; or
2. Refuses to live therein. (Art. 100 par. 1 FC)

Question 28

When shall a judicial authorization be obtained by the other spouse in cases of separation in fact?

Answer 28

Judicial authorization shall be obtained in a summary proceeding when the consent of one spouse to any transaction of the other is required by law (Art. 100 par. 1 FC).

Question 29

When shall the separate property of both spouses be solidarily liable for the support of the family?

Answer 29

Under Article 100 par. 3 of the Family Code, the separate property of the spouses shall be solidarily liable for the support of the family when there is no sufficient community property.

The spouse present shall, upon proper 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.

Question 30

In case either spouse abandons the other or fails to comply with his or her marital obligations, what remedies may the present spouse avail of in court?

Answer 30

Under Article 101 of the Family Code, the remedies available for the spouse who is abandoned or whose spouse fails to comply with oblligations to the family are:

1. Petition for receivership; or
2. Judicial separation of property; or
3. Authority to be the sole administrator of the absolute community

Subject to such precautionary conditions as the court may impose.

Question 31

When may a petition for receivership, judicial separation, and authority to be sole administrator be filed before the court?

Answer 31

Under Article 101: petitions for receivership, judicial separation, or authority to be sole administrator may be filed when:

1. If a spouse abandons the other without just cause; or
2. If the other spouse fails to comply with his or her obligations to the family.

Obligations referred to are:

1. Marital
2. Parental
3. Property relations.

Question 32

When shall a spouse be deemed to have abandoned the other?

Answer 32

Under Article 101 par. 3 FC: A spouse is deemed to have abandoned the other when he or she has left the conjugal dwelling without any intention of returning.

Question 33

When is a spouse presumed to have no intention of returning to the conjugal dwelling?

Answer 33

Under Article 101 par. 3 FC: a spouse is prima facie presumed to have no intention of returning to the conjugal dwelling when:

1. he/she has left the conjugal dwelling for a period of three months; or
2. he/she has failed within the same period (three months) to give any information as to his or her whereabouts.

Question 34

Upon dissolution of the ACP, what shall the inventory contain?

Answer 34

Article 102 (1) FC: The inventory shall separately list:

1. All the properties of the absolute community
2. Exclusive properties of each spouse

Question 35

From where shall debts and obligations of the absolute community be paid from?

Answer 35

Article 102 (2) FC: The debts and obligations of the absolute community shall be paid of its assets.

Question 36

What will happen if the absolute community, upon dissolution, does not have sufficient funds to pay the debts and obligations?

Answer 36

Article 102 (2) FC: In case of insufficiency of said assets, the spouses shall be solidarily liable for the unpaid balance with their separate properties in accordance with the provisions of the second paragraph of Article 94.

Question 37

Shall the spouses be entitled to any asset upon dissolution of the ACP?

Answer 37

Yes, under Article 102 FC:

(3) Whatever remains of the exclusive properties of the spouses shall thereafter be delivered to them.
(4) The net remainder of the properties of the absolute community shall constitute its net assets which shall be divided equally between husband and wife, unless a different portion or division was agreed upon in the marriage settlements, or unless there has been a voluntary waiver of such share as provided in this Code.

Question 38

What shall the net remainder of the ACP constitute?

Answer 38

The net remainder of the properties of the absolute community shall constitute its net assets which shall computed as the increase in value between the market value of the community property at the time of the celebration of the marriage and the market value at the time of its dissolution. (Article 102 par. 4 FC).

Question 39

How shall net profits be computed?

Answer 39

Under Article 102 (4) FC net profits shall be the increase in value between the market value of the community property at the time of the celebration of the marriage and the market value at the time of its dissolution.

Question 40

Formula for net profit of ACP

Answer 40

Net Profit ACP = Market value today - Market value at time of marriage

Question 41

When shall the presumptive legitimes be delivered to the common children? And what procedure shall it follow?

Answer 41

Under Article 102 (5) FC the presumptive legitimes of the common children shall be delivered upon partition, in accordance with Article 51.

Question 42

How are presumptive legitimes to be delivered according to Article 51 of the Family Code?

Answer 42

Article 51 FC: Procedure on delivery of presumptive legitime:

1. Value of presumptive legitime is computed as of the date of the final judgment of the trial;
2. Delivered in cash, property or sound securities unless the parties in a judicially approved agreement have already provided for such matters

Question 43

To whom shall the conjugal dwelling be delivered?

Answer 43

Under Article 102 (6) The conjugal dwelling and the lot on which it is situated shall be adjudicated to the spouse with whom the majority of the common children choose to remain unless otherwise agreed upon by the parties.

Question 44

What is the presumption for children below seven years of age?

Answer 44

Under Article 102 (6), children below the age of seven years are deemed to have chosen the mother, unless the court has decided otherwise.

Question 45

If there is no majority of children, to whom shall the conjugal dwelling be delivered?

Answer 45

Under Article 102 (6), the court shall decide in case there is no majority, but they shall take into consideration the best interest of the children.

Question 46

What procedure shall follow if the ACP is terminated upon death?

Answer 46

Under Article 103 FC, upon the termination of the marriage by death, the community property shall be liquidated in the same proceeding for the settlement of the estate of the deceased.

Question 47

What if there is no judicial settlement instituted, how shall the ACP be terminated?

Answer 47

Under Article 103 par 2 FC, if no judicial settlement proceeding is instituted, the surviving spouse shall liquidate the community property either judicially or extra-judicially within one year from the death of the deceased spouse.

Question 48

What shall happen if the widow/er fails to liquidate the community property of the deceased spouse within one year from the death?

Answer 48

If upon the lapse of the said period, no liquidation is made, any disposition or encumbrance involving the community property of the terminated marriage shall be void. (Art 103 par 2 FC)