Agapay vs. Palang

In a union between a man and a woman who are not capacitated to marry each other (such as a bigamous or adulterous relationship), property ownership is governed by Article 148 of the Family Code, which strictly requires proof of actual contribution of money, property, or industry to establish co-ownership; absent such proof, the property is presumed to belong to the partner who provided the funds.

Miguel Palang left his legal wife and daughter in the Philippines to work in Hawaii, returning years later to cohabit with a much younger woman, Erlinda Agapay, with whom he contracted a void second marriage. During this second union, a rice land and a house and lot were purchased and registered either jointly or in Erlinda's name. Following Miguel's death, his legal family sought to recover these properties, claiming they belonged to the conjugal partnership of the first and valid marriage.

• Miguel Palang married Carlina Vallesterol on July 16, 1949, and they had one child, Herminia.
• Miguel worked in Hawaii and returned to the Philippines in 1972, refusing to live with Carlina and instead staying alone in Pangasinan.
• On July 15, 1973, the 63-year-old Miguel contracted a second marriage with 19-year-old Erlinda Agapay, despite his subsisting marriage to Carlina.
• On May 17, 1973, Miguel and Erlinda jointly purchased a parcel of agricultural rice land, resulting in the issuance of TCT No. 101736 in both their names.
• On September 23, 1975, a house and lot were purchased, allegedly by Erlinda as the sole vendee, resulting in TCT No. 143120 in her name.
• Miguel and Erlinda were convicted of Concubinage in 1979 upon Carlina’s complaint.
• Miguel died on February 15, 1981.
• On July 11, 1981, Carlina and Herminia filed an action for recovery of ownership and possession against Erlinda regarding the rice land and the house and lot.
• Erlinda claimed she bought the house and lot with her own money and that she had already given her half of the rice land to her son with Miguel, Kristopher Palang.

• Erlinda Agapay argued that the deeds of sale for the rice land and the house and lot were valid and should be sustained.
• She contended that the house and lot were her sole property purchased with her own funds.
• She claimed that Carlina was precluded from claiming the properties because Carlina and Miguel had previously executed a compromise agreement donating their conjugal estate to Herminia.
• She argued that Kristopher Palang, her son with Miguel, should be declared an illegitimate heir entitled to inherit and should have been considered a party-defendant in the case.

• Carlina and Herminia Palang argued that they are the rightful owners of the properties in question.
• They contended that the properties were purchased by Miguel during his cohabitation with Erlinda using funds that pertained to the conjugal partnership of the valid marriage.
• They sought the cancellation of the titles registered in Erlinda's name and the delivery of the properties to them.

• Procedural Issues:
  • Whether the illegitimate child, Kristopher Palang, should be considered a party-defendant and whether his heirship can be determined in this ordinary civil action for recovery of ownership.
• Substantive Issues:
  • Who owns the agricultural rice land and the residential house and lot acquired during the bigamous union of Miguel and Erlinda.

• Procedural:
  • The Supreme Court ruled that Kristopher Palang was not a party to the case as he was not impleaded; furthermore, questions regarding his filiation, heirship, and share in the estate must be resolved in a special proceeding or probate court, not in an ordinary civil action for recovery of ownership.
• Substantive:
  • The Court affirmed the Court of Appeals' decision declaring Carlina and Herminia as the owners. Regarding the rice land, Article 148 of the Family Code applies because the marriage was void/bigamous; Erlinda failed to prove actual contribution (she was a student with no income at the time), so the property is presumed to belong to the conjugal partnership of Miguel and Carlina. Regarding the house and lot, evidence showed Miguel provided the money despite the title being in Erlinda's name; this transaction was deemed a void donation between persons guilty of adultery/concubinage under Article 739 of the Civil Code and Article 87 of the Family Code.

• Article 148 of the Family Code — Governs the property relations of men and women who are not capacitated to marry each other (e.g., adulterous relationships); it mandates that only properties acquired through the actual joint contribution of money, property, or industry shall be owned by them in common in proportion to their respective contributions.
• Actual Contribution Requirement — In Article 148 relationships, co-ownership is not presumed; if the actual contribution of a party is not proved, there is no co-ownership, and the property is presumed to belong to the partner who provided the funds.
• Prohibition on Donations (Art. 87 Family Code / Art. 739 Civil Code) — Donations between persons living together as husband and wife without a valid marriage are void, particularly if the donation is made between persons guilty of adultery or concubinage, to ensure that those in illicit unions are not in a better position than those in valid marriages.

• "If the actual contribution of the party is not proved, there will be no co-ownership and no presumption of equal shares."
• "[T]he condition of those who incurred guilt would turn out to be better than those in legal union."

• Buenaventura v. Bautista — Cited to support the principle that the prohibition against donations between spouses applies to donations between persons living together as husband and wife without a valid marriage.
• Matabuena v. Cervantes — Cited to reinforce the doctrine that donations between common-law spouses are void.

• Article 148 of the Family Code — Applied as the governing law for property acquired during the bigamous/adulterous cohabitation, requiring proof of actual contribution.
• Article 147 of the Family Code — Mentioned to contrast with Article 148; Article 147 applies to unions without legal impediment and allows care and maintenance of the family to count as contribution, which is not allowed under Article 148.
• Article 87 of the Family Code — Cited to establish that the prohibition against donations between spouses extends to persons living together without a valid marriage.
• Article 739 of the Civil Code — Cited to declare the donation (purchase of the house in Erlinda's name) void because it was made between persons guilty of adultery or concubinage.
• Article 134 of the Family Code — Cited to clarify that separation of property between spouses requires a judicial order or a marriage settlement, and cannot be inferred merely from a compromise agreement.