Francisco vs. Court of Appeals

The presumption of conjugality under Article 160 of the Civil Code does not arise unless the party invoking it first proves that the property in controversy was acquired during the marriage; proof of acquisition during coverture is a condition sine qua non for the presumption's operation.

Petitioner Teresita C. Francisco is the legal wife of private respondent Eusebio Francisco by his second marriage, celebrated on February 10, 1962. Private respondents Conchita Evangelista, Araceli F. Marilla, and Antonio Francisco are Eusebio's children from his first marriage. The dispute concerns several properties in Rodriguez (formerly Montalban), Rizal—a sari-sari store, a residential house and lot, an apartment, and a separate house and lot at Barrio San Isidro—whose administration petitioner sought to control after Eusebio allegedly became incapacitated and executed a general power of attorney authorizing Conchita Evangelista to administer the house, lot, and apartments. The Family Code of the Philippines took effect on August 3, 1988, repealing Title VI (including Articles 158 and 160) of the Civil Code, but the events giving rise to the dispute predated that effectivity.

Petitioner Teresita C. Francisco is the legal wife of Eusebio Francisco by his second marriage, celebrated on February 10, 1962. Private respondents Conchita Evangelista, Araceli F. Marilla, and Antonio Francisco are Eusebio's children from his first marriage. Petitioner alleged that since their marriage, she and Eusebio had acquired a sari-sari store, a residential house and lot, and an apartment house, all situated at Col. S. Cruz St., Barangay Balite, Rodriguez, Rizal, as well as a house and lot at Barrio San Isidro, Rodriguez, Rizal. She claimed these properties were administered by Eusebio until he became incapacitated on account of tuberculosis, heart disease, and cancer, rendering him unfit to manage them. Petitioner further asserted that private respondents had convinced their father to sign a general power of attorney authorizing Conchita Evangelista to administer the house, lot, and apartments in Rodriguez, Rizal.

On August 31, 1988, petitioner filed a suit for damages and for annulment of the general power of attorney, seeking to enjoin its enforcement and to be declared administratrix of the disputed properties. The trial court ruled against petitioner, holding that she failed to adduce proof that the properties were acquired during the existence of the second conjugal partnership or that they pertained exclusively to her. The court declared the properties to belong exclusively to Eusebio and found him capable of administering them. On appeal, the Court of Appeals affirmed the trial court's decision in toto.

Regarding the land at Col. Cruz St., Eusebio testified that he inherited it from his parents. Petitioner herself admitted that Eusebio brought the land into their marriage, albeit in the concept of a possessor only, as it was not yet registered in his name at the time. As for the house, apartment, and sari-sari store on that land, private respondents averred these were constructed or established by their father during his first marriage. Petitioner relied on building permits listing her as the applicant, though in Eusebio's name, and a business license for the sari-sari store issued in her name alone. The appellate court found these documents insufficient to establish that the improvements were acquired during the second marriage, noting that the exhibits themselves described Eusebio as the owner of the structures. Concerning the San Isidro property, the title was registered in the name of "Eusebio Francisco, married to Teresita Francisco," which petitioner invoked as proof of conjugality. The lower courts found this designation merely descriptive of Eusebio's civil status and insufficient to establish acquisition during coverture. The trial court also found that Eusebio was not incapacitated; while he suffered a leg injury from a bicycle accident, allegedly aggravated when petitioner pushed him during a quarrel, this did not render him unfit to administer his properties.

• Repeal of Civil Code Provisions: Petitioner argued that the Court of Appeals erred in applying Articles 158 and 160 of the Civil Code because those provisions, together with the rest of Title VI, had already been repealed by Article 253 of the Family Code.
• Applicability of Article 124 of the Family Code: Petitioner maintained that Article 124 of the Family Code should govern the disposition of the case instead of the repealed Civil Code provisions.
• Conjugal Nature of Properties: Petitioner contended that the subject properties are conjugal and that she should administer them on account of Eusebio's alleged incapacity, citing building permits with her as applicant, a business license in her name, and the San Isidro title registered in the name of "Eusebio Francisco, married to Teresita Francisco."

• Exclusive Ownership of Eusebio: Respondents maintained that the properties in controversy are Eusebio's exclusive capital properties, acquired either through inheritance or through his industry prior to his second marriage.
• Eusebio's Capacity: Respondents stressed that Eusebio is not incapacitated, contrary to petitioner's allegation.

• Nature of Properties: Whether the appellate court committed reversible error in affirming the trial court's ruling that the subject properties are not conjugal but the capital properties of Eusebio exclusively.
• Applicability of Family Code vs. Civil Code: Whether Article 116 of the Family Code applies to this case, given the alleged repeal of Articles 158 and 160 of the Civil Code by the Family Code.
• Administration of Properties: Whether petitioner should be declared administratrix of the subject properties on account of Eusebio's alleged incapacity.

• Nature of Properties: No. The properties belong exclusively to Eusebio, petitioner having failed to prove they were acquired during the marriage—a condition sine qua non for the presumption of conjugality under Article 160 of the Civil Code to operate.
• Applicability of Family Code vs. Civil Code: The Civil Code governs. Although Articles 158 and 160 were repealed by Article 254 of the Family Code, the new law cannot be invoked without impairing vested rights pursuant to Article 256 in relation to Article 105 of the Family Code.
• Administration of Properties: No. Eusebio retains administration because the properties are exclusively his capital; even assuming they were conjugal, Eusebio was not incapacitated as found by the trial court.

• Nature of Properties: Article 160 of the Civil Code presumes all property of the marriage to belong to the conjugal partnership unless proven to pertain exclusively to one spouse. However, the party invoking this presumption must first prove that the property was acquired during the marriage; proof of acquisition during coverture is a condition sine qua non. The presumption does not operate when there is no showing as to when the property was acquired. In this case, petitioner failed to adduce ample evidence that the properties were acquired during her marriage with Eusebio. With respect to the Col. Cruz St. land, Eusebio testified he inherited it from his parents, and petitioner herself admitted he brought it into the marriage. Whether the inheritance was received before or after the second marriage is inconsequential: if before, it is separate property under Article 148(1) as property brought to the marriage; if during, it is separate property under Article 148(2) as acquisition by lucrative title. As for the house, apartment, and sari-sari store, building permits and business licenses do not prove acquisition during the second marriage, and the exhibits themselves described Eusebio as owner. Regarding the San Isidro property, registration in the name of "Eusebio Francisco, married to Teresita Francisco" does not prove acquisition during coverture; registration does not confer title but merely confirms one already existing, and the phrase "married to" is merely descriptive of civil status.

• Applicability of Family Code vs. Civil Code: Articles 158 and 160 of the Civil Code were indeed repealed by Article 254 (not Article 253 as petitioner alleged) of the Family Code, which took effect on August 3, 1988. Nonetheless, the new law cannot be invoked without impairing prior vested rights pursuant to Article 256 in relation to Article 105 (second paragraph) of the Family Code. Rights accrued and vested while the cited Civil Code articles were in effect survive their repeal. The issue of the nature of the contested properties was therefore resolved based on the provisions of the New Civil Code.

• Administration of Properties: Because the properties are exclusively Eusebio's capital, he retains control and administration thereof. Even assuming arguendo that the properties were conjugal, petitioner could not administer them because Eusebio is not incapacitated. The trial court found that Eusebio, while handicapped due to a leg injury from a bicycle accident, was not suffering from serious illness so as to impair his fitness to administer his properties.

• Presumption of Conjugality (Article 160, Civil Code) — All property of the marriage is presumed to belong to the conjugal partnership unless it be proved that it pertains exclusively to the husband or to the wife. However, the party invoking this presumption must first prove that the property was acquired during the marriage. Proof of acquisition during coverture is a condition sine qua non for the operation of the presumption. The presumption is rebuttable, but only with strong, clear, and convincing evidence of exclusive ownership by one spouse. In this case, petitioner's failure to prove acquisition during the marriage precluded application of the presumption.

• Vested Rights Doctrine (Article 256, Family Code) — The Family Code has retroactive effect insofar as it does not prejudice or impair vested or acquired rights in accordance with the Civil Code or other laws. Although Articles 158 and 160 of the Civil Code were repealed by the Family Code, rights accrued and vested while those articles were in effect survive their repeal. The Court applied the Civil Code provisions rather than the Family Code to avoid impairing vested rights.

• Registration Does Not Confer Title — Registration does not confer title but merely confirms one already existing. The phrase "married to" preceding a spouse's name in a certificate of title is merely descriptive of civil status and does not prove that the property was acquired during the marriage. The Court applied this doctrine to reject petitioner's reliance on the San Isidro property title.

• Exclusive Property by Lucrative Title (Article 148, Civil Code) — Property acquired by a spouse during the marriage by inheritance, devise, legacy, or donation is exclusive property. Property brought to the marriage as one's own is likewise exclusive. The Court held that the Col. Cruz St. land was Eusebio's exclusive property whether inherited before or during the second marriage.

• "However, the party who invokes this presumption must first prove that the property in controversy was acquired during the marriage. Proof of acquisition during the coverture is a condition sine qua non for the operation of the presumption in favor of the conjugal partnership." — This passage states the ratio decidendi on the presumption of conjugality, establishing the prerequisite of proving acquisition during coverture before the presumption may be invoked.

• "Acquisition of title and registration thereof are two different acts. It is well settled that registration does not confer title but merely confirms one already existing. The phrase 'married to' preceding 'Teresita Francisco' is merely descriptive of the civil status of Eusebio Francisco." — This passage articulates the doctrine that registration is not equivalent to acquisition of title and clarifies the evidentiary significance of the "married to" designation in a certificate of title.

• "Nonetheless, we cannot invoke the new law in this case without impairing prior vested rights pursuant to Article 256 in relation to Article 105 (second paragraph) of the Family Code. Accordingly, the repeal of Articles 158 and 160 of the New Civil Code does not operate to prejudice or otherwise affect rights which have become vested or accrued while the said provisions were in force." — This passage defines the interplay between the repeal of Civil Code provisions and the protection of vested rights under the Family Code, explaining why the Civil Code rather than the Family Code governed the dispute.

• Jocson vs. Court of Appeals, 170 SCRA 333 (1989) — Cited for the rule that the party invoking the presumption of conjugality must first prove that the property was acquired during the marriage, and that acquisition of title and registration are two different acts. This case was followed as controlling authority on the prerequisites for the Article 160 presumption.

• Villanueva vs. Intermediate Appellate Court, 192 SCRA 21 (1990) — Cited for the proposition that property acquired during the marriage by lucrative title is exclusive property of the spouse under Article 148(2) of the Civil Code, supporting the holding that the inherited land was Eusebio's exclusive property.

• Villones vs. Employees' Compensation Commission, 92 SCRA 320 (1979) — Cited for the principle that rights accrued and vested while a statute was in effect survive its repeal, supporting the application of the Civil Code rather than the Family Code to protect vested rights.

• Cuenca vs. Cuenca, 168 SCRA 335 (1988) — Cited for the rule that the presumption of conjugality does not operate when there is no showing as to when the property alleged to be conjugal was acquired.

• Article 160, Civil Code of the Philippines — Provides that all property of the marriage is presumed to belong to the conjugal partnership unless proved to pertain exclusively to one spouse. Applied as the governing presumption, but held inapplicable because petitioner failed to prove acquisition during the marriage.

• Article 148, Civil Code of the Philippines — Enumerates the exclusive property of each spouse, including property brought to the marriage as one's own and property acquired during the marriage by lucrative title. Applied to classify the inherited Col. Cruz St. land as Eusebio's exclusive property.

• Article 158, Civil Code of the Philippines — Governs improvements made on separate property through advancements from the partnership or industry of either spouse. Cited but held inapplicable to the sari-sari store for want of evidence that it was constructed at the expense of the partnership during the second marriage.

• Article 254, Family Code of the Philippines — Repeals Titles III through XI of Book I of the Civil Code, including Articles 158 and 160. Acknowledged as the repealing provision, but its application was limited by the vested rights doctrine.

• Article 256, Family Code of the Philippines — Provides that the Family Code has retroactive effect insofar as it does not prejudice or impair vested or acquired rights. Applied to preserve rights accrued under the Civil Code and justify resolving the dispute under the Civil Code rather than the Family Code.

• Article 105 (second paragraph), Family Code of the Philippines — Provides that the provisions on conjugal partnership of gains apply to partnerships already established before the effectivity of the Family Code, without prejudice to vested rights. Read in conjunction with Article 256 to support the application of the Civil Code.

Davide, Jr., Bellosillo, Vitug, and Panganiban, JJ., concurred.