#107 Domingo vs. Molina

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Conjugal Partnership of Gains: Dissolution

MELECIO DOMINGO vs. SPOUSES GENARO MOLINA and ELENA B. MOLINA,


substituted by ESTER MOLINA
G.R. No. 200274, April 20, 2016, SECOND DIVISION (BRION, J.)

DOCTRINE:
If no judicial settlement proceeding is instituted, the surviving spouse shall
liquidate the conjugal partnership property either judicially or extrajudicially within one
year from the death of the deceased spouse. If upon the lapse of the six month period
no liquidation is made, any disposition or encumbrance involving the conjugal
partnership property of the terminated marriage shall be void.

FACTS:
The spouses Anastacio and Flora Domingo bought a parcel of land. During his
lifetime, Anastacio borrowed money from the respondent spouses Genaro and Elena
Molina. 10 years after Flora’s death, Anastacio sold his interest over the land to the
spouses Molina to answer for his debts.
Melecio, one of the children of Anastacio and Flora, learned of the transfer and
filed a Complaint for Annulment of Title and Recovery of Ownership against the
spouses Molina. Melecio claims that Anastacio gave the subject property to the spouses
Molina to serve as collateral for the money that Anastacio borrowed. Anastacio could
not have validly sold the interest over the subject property without Flora’s consent, as
Flora was already dead at the time of the sale.
The RTC dismissed the case because Melecio failed to establish his claim. The
RTC also held that Anastacio could dispose of conjugal property without Flora’s consent
since the sale was necessary to answer for conjugal liabilities. The CA affirmed the RTC
ruling in toto. The CA also held that Flora’s death is immaterial because Anastacio only
sold his rights, excluding Flora’s interest, over the lot to the spouses Molina.1

ISSUE:
Whether the sale of a conjugal property to the spouses Molina without Flora’s
consent is valid and legal?

RULING:
YES. Article 130. Upon the termination of the marriage by death, the conjugal
partnership property shall be liquidated in the same proceeding for the settlement of the
estate of the deceased.
In the case of Taningco v. Register of Deeds of Laguna, we held that the
properties of a dissolved conjugal partnership fall under the regime of co-ownership
among the surviving spouse and the heirs of the deceased spouse until final liquidation
and partition. The surviving spouse, however, has an actual and vested one-half
undivided share of the properties, which does not consist of determinate and
segregated properties until liquidation and partition of the conjugal partnership.
An implied ordinary co-ownership ensued among Flora’s surviving heirs,
including Anastacio, with respect to Flora’s share of the conjugal partnership until final
liquidation and partition; Anastacio, on the other hand, owns one-half of the original
conjugal partnership properties as his share, but this is an undivided interest.
Thus, Anastacio, as co-owner, cannot claim title to any specific portion of the
conjugal properties without an actual partition being first done either by agreement or by
judicial decree. Nonetheless, Anastacio had the right to freely sell and dispose of his
undivided interest in the subject property.
The OCT annotation of the sale to the spouses Molina reads that "only the rights,
interests and participation of Anastacio Domingo, married to Flora Dela Cruz, is hereby
sold, transferred, and conveyed unto the said vendees x x x x ”. At the time of the sale,
Anastacio’s undivided interest in the conjugal properties consisted of: (1) one-half of the
entire conjugal properties; and (2) his share as Flora’s heir on the conjugal properties.
Anastacio, as a co-owner, had the right to freely sell and dispose of his undivided
interest, but not the interest of his co-owners. Consequently, Anastactio’s sale to the
spouses Molina without the consent of the other co-owners was not totally void, for
Anastacio’s rights or a portion thereof were thereby effectively transferred, making the
spouses Molina a co-owner of the subject property to the extent of Anastacio’s interest.
This result conforms with the well-established principle that the binding force of a
contract must be recognized as far as it is legally possible to do so (quando res non
valet ut ago, valeat quantum valere potest).
The spouses Molina would be a trustee for the benefit of the co-heirs of
Anastacio in respect of any portion that might belong to the co-heirs after liquidation and
partition.
Melecio’s recourse as a co-owner of the conjugal properties, including the
subject property, is an action for partition under Rule 69 of the Revised Rules of Court.
As held in the case of Heirs of Protacio Go, Sr., "it is now settled that the appropriate
recourse of co-owners in cases where their consent were not secured in a sale of the
entire property as well as in a sale merely of the undivided shares of some of the co-
owners is an action for PARTITION under Rule 69 of the Revised Rules of Court.

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