Chapter 2.

The Family Home

Art. 152. The family home, constituted jointly by the husband and the wife or by an
unmarried head of a family, is the dwelling house where they and their family reside,
and the land on which it is situated. (223a)

Art. 153. The family home is deemed constituted on a house and lot from the time it is
occupied as a family residence. From the time of its constitution and so long as any of
its beneficiaries actually resides therein, the family home continues to be such and is
exempt from execution, forced sale or attachment except as hereinafter provided and
to the extent of the value allowed by law. (223a)

Art. 154. The beneficiaries of a family home are:

(1) The husband and wife, or an unmarried person who is the head of a family; and

(2) Their parents, ascendants, descendants, brothers and sisters, whether the
relationship be legitimate or illegitimate, who are living in the family home and who
depend upon the head of the family for legal support. (226a)

Art. 155. The family home shall be exempt from execution, forced sale or attachment
except:

(1) For nonpayment of taxes;

(2) For debts incurred prior to the constitution of the family home;

(3) For debts secured by mortgages on the premises before or after such constitution;
and

(4) For debts due to laborers, mechanics, architects, builders, materialmen and others
who have rendered service or furnished material for the construction of the building.
(243a)

Art. 156. The family home must be part of the properties of the absolute community or
the conjugal partnership, or of the exclusive properties of either spouse with the latter’s
consent. It may also be constituted by an unmarried head of a family on his or her own
property.

Nevertheless, property that is the subject of a conditional sale on installments where

ownership is reserved by the vendor only to guarantee payment of the purchase price
may be constituted as a family home. (227a, 228a)

Art. 157. The actual value of the family home shall not exceed, at the time of its
constitution, the amount of the three hundred thousand pesos in urban areas, and two
hundred thousand pesos in rural areas, or such amounts as may hereafter be fixed by
law.

In any event, if the value of the currency changes after the adoption of this Code, the
value most favorable for the constitution of a family home shall be the basis of
evaluation.
For purposes of this Article, urban areas are deemed to include chartered cities and
municipalities whose annual income at least equals that legally required for chartered
cities. All others are deemed to be rural areas. (231a)

Art. 158. The family home may be sold, alienated, donated, assigned or encumbered
by the owner or owners thereof with the written consent of the person constituting the
same, the latter’s spouse, and a majority of the beneficiaries of legal age. In case of
conflict, the court shall decide. (235a)

Art. 159. The family home shall continue despite the death of one or both spouses or of
the unmarried head of the family for a period of ten years or for as long as there is a
minor beneficiary, and the heirs cannot partition the same unless the court finds
compelling reasons therefor. This rule shall apply regardless of whoever owns the
property or constituted the family home. (238a)

Art. 160. When a creditor whose claims is not among those mentioned in Article 155
obtains a judgment in his favor, and he has reasonable grounds to believe that the
family home is actually worth more than the maximum amount fixed in Article 157, he
may apply to the court which rendered the judgment for an order directing the sale of
the property under execution. The court shall so order if it finds that the actual value of
the family home exceeds the maximum amount allowed by law as of the time of its
constitution. If the increased actual value exceeds the maximum allowed in Article 157
and results from subsequent voluntary improvements introduced by the person or
persons constituting the family home, by the owner or owners of the property, or by any
of the beneficiaries, the same rule and procedure shall apply.

At the execution sale, no bid below the value allowed for a family home shall be
considered. The proceeds shall be applied first to the amount mentioned in Article 157,
and then to the liabilities under the judgment and the costs. The excess, if any, shall be
delivered to the judgment debtor. (247a, 248a)

Art. 161. For purposes of availing of the benefits of a family home as provided for in
this Chapter, a person may constitute, or be the beneficiary of, only one family home.
(n)

Art. 162. The provisions in this Chapter shall also govern existing family residences
insofar as said provisions are applicable. (n)
 PATRICIO v. DARIO III
FIRST DIVISION

G.R. No. 170829 November 20, 2006

PERLA G. PATRICIO, Petitioner,

vs.
MARCELINO G. DARIO III and THE HONORABLE COURT OF APPEALS, Second
Division, Respondents.

DECISION

YNARES-SANTIAGO, J.:

This petition for review on certiorari under Rule 45 of the Rules of Court seeks to annul and set aside
the Resolution of the Court of Appeals dated December 9, 20051 in CA-G.R. CV No. 80680, which
dismissed the complaint for partition filed by petitioner for being contrary to law and evidence.

On July 5, 1987, Marcelino V. Dario died intestate. He was survived by his wife, petitioner Perla G.
Patricio and their two sons, Marcelino Marc Dario and private respondent Marcelino G. Dario III.
Among the properties he left was a parcel of land with a residential house and a pre-school building
built thereon situated at 91 Oxford corner Ermin Garcia Streets in Cubao, Quezon City, as evidenced
by Transfer Certificate of Title (TCT) No. RT-30731 (175992) of the Quezon City Registry of Deeds,
covering an area of seven hundred fifty five (755) square meters, more or less. 2

On August 10, 1987, petitioner, Marcelino Marc and private respondent, extrajudicially settled the
estate of Marcelino V. Dario. Accordingly, TCT No. RT-30731 (175992) was cancelled and TCT No.
R-213963 was issued in the names of petitioner, private respondent and Marcelino Marc.

Thereafter, petitioner and Marcelino Marc formally advised private respondent of their intention to
partition the subject property and terminate the co-ownership. Private respondent refused to partition
the property hence petitioner and Marcelino Marc instituted an action for partition before the
Regional Trial Court of Quezon City which was docketed as Civil Case No. Q-01-44038 and raffled
to Branch 78.

On October 3, 2002,3 the trial court ordered the partition of the subject property in the following
manner: Perla G. Patricio, 4/6; Marcelino Marc G. Dario, 1/6; and Marcelino G. Dario III, 1/6. The
trial court also ordered the sale of the property by public auction wherein all parties concerned may
put up their bids. In case of failure, the subject property should be distributed accordingly in the
aforestated manner.4

Private respondent filed a motion for reconsideration which was denied by the trial court on August
11, 2003,5 hence he appealed before the Court of Appeals, which denied the same on October 19,
2005. However, upon a motion for reconsideration filed by private respondent on December 9, 2005,
the appellate court partially reconsidered the October 19, 2005 Decision. In the now assailed
Resolution, the Court of Appeals dismissed the complaint for partition filed by petitioner and
Marcelino Marc for lack of merit. It held that the family home should continue despite the death of
one or both spouses as long as there is a minor beneficiary thereof. The heirs could not partition the
property unless the court found compelling reasons to rule otherwise. The appellate court also held
that the minor son of private respondent, who is a grandson of spouses Marcelino V. Dario and Perla
G. Patricio, was a minor beneficiary of the family home.6

Hence, the instant petition on the following issues:

I.

THE HONORABLE COURT OF APPEALS PATENTLY ERRED IN REVERSING ITS

EARLIER DECISION OF OCTOBER 19, 2005 WHICH AFFIRMED IN TOTO THE
DECISION OF THE TRIAL COURT DATED 03 OCTOBER 2002 GRANTING THE
PARTITION AND SALE BY PUBLIC AUCTION OF THE SUBJECT PROPERTY.

II.

COROLLARILY, THE HONORABLE COURT OF APPEALS PATENTLY ERRED IN

APPLYING ARTICLE 159 IN RELATION TO ARTICLE 154 OF THE FAMILY CODE ON
FAMILY HOME INSTEAD OF ARTICLE 494 IN RELATION TO ARTICLES 495 AND 498 OF
THE NEW CIVIL CODE ON CO-OWNERSHIP.7

The sole issue is whether partition of the family home is proper where one of the co-owners refuse to
accede to such partition on the ground that a minor beneficiary still resides in the said home.

Private respondent claims that the subject property which is the family home duly constituted by
spouses Marcelino and Perla Dario cannot be partitioned while a minor beneficiary is still living
therein namely, his 12-year-old son, who is the grandson of the decedent. He argues that as long as
the minor is living in the family home, the same continues as such until the beneficiary becomes of
age. Private respondent insists that even after the expiration of ten years from the date of death of
Marcelino on July 5, 1987, i.e., even after July 1997, the subject property continues to be considered
as the family home considering that his minor son, Marcelino Lorenzo R. Dario IV, who is a
beneficiary of the said family home, still resides in the premises.

On the other hand, petitioner alleges that the subject property remained as a family home of the
surviving heirs of the late Marcelino V. Dario only up to July 5, 1997, which was the 10th year from
the date of death of the decedent. Petitioner argues that the brothers Marcelino Marc and private
respondent Marcelino III were already of age at the time of the death of their father, 8 hence there is
no more minor beneficiary to speak of.

The family home is a sacred symbol of family love and is the repository of cherished memories that
last during one’s lifetime.9 It is the dwelling house where husband and wife, or by an unmarried head
of a family, reside, including the land on which it is situated.10 It is constituted jointly by the husband
and the wife or by an unmarried head of a family.11 The family home is deemed constituted from the
time it is occupied as a family residence. From the time of its constitution and so long as any of its
beneficiaries actually resides therein, the family home continues to be such and is exempt from
execution, forced sale or attachment except as hereinafter provided and to the extent of the value
allowed by law.12

The law explicitly provides that occupancy of the family home either by the owner thereof or by "any
of its beneficiaries" must be actual. That which is "actual" is something real, or actually existing, as
opposed to something merely possible, or to something which is presumptive or constructive. Actual
occupancy, however, need not be by the owner of the house specifically. Rather, the property may
be occupied by the "beneficiaries" enumerated in Article 154 of the Family Code, which may include
the in-laws where the family home is constituted jointly by the husband and wife. But the law
definitely excludes maids and overseers. They are not the beneficiaries contemplated by the Code. 13

Article 154 of the Family Code enumerates who are the beneficiaries of a family home: (1) The
husband and wife, or an unmarried person who is the head of a family; and (2) Their parents,
ascendants, descendants, brothers and sisters, whether the relationship be legitimate or illegitimate,
who are living in the family home and who depend upon the head of the family for legal support.

To be a beneficiary of the family home, three requisites must concur: (1) they must be among the
relationships enumerated in Art. 154 of the Family Code; (2) they live in the family home; and (3)
they are dependent for legal support upon the head of the family.

Moreover, Article 159 of the Family Code provides that the family home shall continue despite the
death of one or both spouses or of the unmarried head of the family for a period of 10 years or for as
long as there is a minor beneficiary, and the heirs cannot partition the same unless the court finds
compelling reasons therefor. This rule shall apply regardless of whoever owns the property or
constituted the family home.

Article 159 of the Family Code applies in situations where death occurs to persons who constituted
the family home. Dr. Arturo M. Tolentino comments on the effect of death of one or both spouses or
1âwphi1

the unmarried head of a family on the continuing existence of the family home:

Upon the death of the spouses or the unmarried family head who constituted the family home, or of
the spouse who consented to the constitution of his or her separate property as family home, the
property will remain as family home for ten years or for as long as there is a minor beneficiary living
in it. If there is no more beneficiary left at the time of death, we believe the family home will be
dissolved or cease, because there is no more reason for its existence. If there are
beneficiaries who survive living in the family home, it will continue for ten years, unless at
the expiration of the ten years, there is still a minor beneficiary, in which case the family
home continues until that beneficiary becomes of age.

After these periods lapse, the property may be partitioned by the heirs. May the heirs who are
beneficiaries of the family home keep it intact by not partitioning the property after the period
provided by this article? We believe that although the heirs will continue in ownership by not
partitioning the property, it will cease to be a family home.14 (Emphasis supplied)

Prof. Ernesto L. Pineda further explains the import of Art. 159 in this manner:

The family home shall continue to exist despite the death of one or both spouses or of the unmarried
head of the family. Thereafter, the length of its continued existence is dependent upon whether
there is still a minor-beneficiary residing therein. For as long as there is one beneficiary even
if the head of the family or both spouses are already dead, the family home will continue to
exist (Arts. 153, 159). If there is no minor-beneficiary, it will subsist until 10 years and within
this period, the heirs cannot partition the same except when there are compelling reasons
which will justify the partition. This rule applies regardless of whoever owns the property or who
constituted the family home.15 (Emphasis supplied)

The rule in Article 159 of the Family Code may thus be expressed in this wise: If there are
beneficiaries who survive and are living in the family home, it will continue for 10 years, unless at the
expiration of 10 years, there is still a minor beneficiary, in which case the family home continues until
that beneficiary becomes of age.

It may be deduced from the view of Dr. Tolentino that as a general rule, the family home may be
preserved for a minimum of 10 years following the death of the spouses or the unmarried family
head who constituted the family home, or of the spouse who consented to the constitution of his or
her separate property as family home. After 10 years and a minor beneficiary still lives therein, the
family home shall be preserved only until that minor beneficiary reaches the age of majority. The
intention of the law is to safeguard and protect the interests of the minor beneficiary until he reaches
legal age and would now be capable of supporting himself. However, three requisites must concur
before a minor beneficiary is entitled to the benefits of Art. 159: (1) the relationship enumerated in
Art. 154 of the Family Code; (2) they live in the family home, and (3) they are dependent for legal
support upon the head of the family.

Thus, the issue for resolution now is whether Marcelino Lorenzo R. Dario IV, the minor son of private
respondent, can be considered as a beneficiary under Article 154 of the Family Code.

As to the first requisite, the beneficiaries of the family home are: (1) The husband and wife, or an
unmarried person who is the head of a family; and (2) Their parents, ascendants, descendants,
brothers and sisters, whether the relationship be legitimate or illegitimate. The term "descendants"
contemplates all descendants of the person or persons who constituted the family home without
distinction; hence, it must necessarily include the grandchildren and great grandchildren of the
spouses who constitute a family home. Ubi lex non distinguit nec nos distinguire debemos. Where
the law does not distinguish, we should not distinguish. Thus, private respondent’s minor son, who is
also the grandchild of deceased Marcelino V. Dario satisfies the first requisite.

As to the second requisite, minor beneficiaries must be actually living in the family home to avail of
the benefits derived from Art. 159. Marcelino Lorenzo R. Dario IV, also known as Ino, the son of
private respondent and grandson of the decedent Marcelino V. Dario, has been living in the family
home since 1994, or within 10 years from the death of the decedent, hence, he satisfies the second
requisite.

However, as to the third requisite, Marcelino Lorenzo R. Dario IV cannot demand support from his
paternal grandmother if he has parents who are capable of supporting him. The liability for legal
support falls primarily on Marcelino Lorenzo R. Dario IV’s parents, especially his father, herein
private respondent who is the head of his immediate family. The law first imposes the obligation of
legal support upon the shoulders of the parents, especially the father, and only in their default is the
obligation imposed on the grandparents.

Marcelino Lorenzo R. Dario IV is dependent on legal support not from his grandmother, but from his
father. Thus, despite residing in the family home and his being a descendant of Marcelino V. Dario,
1âwphi1

Marcelino Lorenzo R. Dario IV cannot be considered as beneficiary contemplated under Article 154
because he did not fulfill the third requisite of being dependent on his grandmother for legal support.
It is his father whom he is dependent on legal support, and who must now establish his own family
home separate and distinct from that of his parents, being of legal age.

Legal support, also known as family support, is that which is provided by law, comprising everything
indispensable for sustenance, dwelling, clothing, medical attendance, education and transportation,
in keeping with the financial capacity of the family.16 Legal support has the following characteristics:
(1) It is personal, based on family ties which bind the obligor and the obligee; (2) It is intransmissible;
(3) It cannot be renounced; (4) It cannot be compromised; (5) It is free from attachment or execution;
(6) It is reciprocal; (7) It is variable in amount.17

Professor Pineda is of the view that grandchildren cannot demand support directly from their
grandparents if they have parents (ascendants of nearest degree) who are capable of supporting
them. This is so because we have to follow the order of support under Art. 199. 18 We agree with this
view.

The reasons behind Art. 199 as explained by Pineda and Tolentino: the closer the relationship of the
relatives, the stronger the tie that binds them. Thus, the obligation to support under Art. 199 which
outlines the order of liability for support is imposed first upon the shoulders of the closer relatives
and only in their default is the obligation moved to the next nearer relatives and so on.

There is no showing that private respondent is without means to support his son; neither is there any
evidence to prove that petitioner, as the paternal grandmother, was willing to voluntarily provide for
her grandson’s legal support. On the contrary, herein petitioner filed for the partition of the property
which shows an intention to dissolve the family home, since there is no more reason for its existence
after the 10-year period ended in 1997.

With this finding, there is no legal impediment to partition the subject property.

The law does not encourage co-ownerships among individuals as oftentimes it results in inequitable
situations such as in the instant case. Co-owners should be afforded every available opportunity to
divide their co-owned property to prevent these situations from arising.

As we ruled in Santos v. Santos,19 no co-owner ought to be compelled to stay in a co-ownership

indefinitely, and may insist on partition on the common property at any time. An action to demand
partition is imprescriptible or cannot be barred by laches. Each co-owner may demand at any time
the partition of the common property.20

Since the parties were unable to agree on a partition, the court a quo should have ordered a partition
by commissioners pursuant to Section 3, Rule 69 of the Rules of Court. Not more than three
competent and disinterested persons should be appointed as commissioners to make the partition,
commanding them to set off to the plaintiff and to each party in interest such part and proportion of
the property as the court shall direct.

When it is made to appear to the commissioners that the real estate, or a portion thereof, cannot be
divided without great prejudice to the interest of the parties, the court may order it assigned to one of
the parties willing to take the same, provided he pays to the other parties such sum or sums of
money as the commissioners deem equitable, unless one of the parties interested ask that the
property be sold instead of being so assigned, in which case the court shall order the commissioners
to sell the real estate at public sale, and the commissioners shall sell the same accordingly. 21

The partition of the subject property should be made in accordance with the rule embodied in Art.
996 of the Civil Code.22 Under the law of intestate succession, if the widow and legitimate children
survive, the widow has the same share as that of each of the children. However, since only one-half
of the conjugal property which is owned by the decedent is to be allocated to the legal and
compulsory heirs (the other half to be given exclusively to the surviving spouse as her conjugal
share of the property), the widow will have the same share as each of her two surviving children.
Hence, the respective shares of the subject property, based on the law on intestate succession are:
(1) Perla Generosa Dario, 4/6; (2) Marcelino Marc G. Dario II, 1/6 and (3) Marcelino G. Dario III, 1/6.

In Vda. de Daffon v. Court of Appeals,23 we held that an action for partition is at once an action for
declaration of co-ownership and for segregation and conveyance of a determinate portion of the
properties involved. If the court after trial should find the existence of co-ownership among the
parties, the court may and should order the partition of the properties in the same action. 24

WHEREFORE, the petition is GRANTED. The Resolution of the Court of Appeals in CA-G.R. CV No.
80680 dated December 9, 2005, is REVERSED and SET ASIDE. The case is REMANDED to the
Regional Trial Court of Quezon City, Branch 78, who is directed to conduct a PARTITION BY
COMMISSIONERS and effect the actual physical partition of the subject property, as well as the
improvements that lie therein, in the following manner: Perla G. Dario, 4/6; Marcelino Marc G. Dario,
1/6 and Marcelino G. Dario III, 1/6. The trial court is DIRECTED to appoint not more than three (3)
competent and disinterested persons, who should determine the technical metes and bounds of the
property and the proper share appertaining to each heir, including the improvements, in accordance
with Rule 69 of the Rules of Court. When it is made to the commissioners that the real estate, or a
portion thereof, cannot be divided without great prejudice to the interest of the parties, the court a
quo may order it assigned to one of the parties willing to take the same, provided he pays to the
other parties such sum or sums of money as the commissioners deem equitable, unless one of the
parties interested ask that the property be sold instead of being so assigned, in which case the court
shall order the commissioners to sell the real estate at public sale, and the commissioners shall sell
the same accordingly, and thereafter distribute the proceeds of the sale appertaining to the just
share of each heir. No pronouncement as to costs.

SO ORDERED.

CONSUELO YNARES-SANTIAGO
Associate Justice

WE CONCUR:

ARTEMIO V. PANGANIBAN
Chief Justice
Chairperson

MA. ALICIA AUSTRIA-MARTINEZ ROMEO J. CALLEJO, SR.

Associate Justice Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in
the above Decision were reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.

ARTEMIO V. PANGANIBAN
Chief Justice
 MODEQUILLO v. BREVA
FIRST DIVISION

G.R. No. 86355 May 31, 1990

JOSE MODEQUILLO, petitioner,

vs.
HON. AUGUSTO V. BREVA FRANCISCO SALINAS, FLORIPER ABELLAN-SALINAS, JUANITO
CULAN-CULAN and DEPUTY SHERIFF FERNANDO PLATA respondents.

Josefina Brandares-Almazan for petitioner.

ABC Law Offices for private respondents.

GANCAYCO, J.:

The issue in this petition is whether or not a final judgment of the Court of Appeals in an action for damages may be satisfied by way of
execution of a family home constituted under the Family Code.

The facts are undisputed.

On January 29, 1988, a judgment was rendered by the Court of Appeals in CA-G.R. CV No. 09218
entitled "Francisco Salinas, et al. vs. Jose Modequillo, et al.," the dispositive part of which read as
follows:

WHEREFORE, the decision under appeal should be, as it is hereby, reversed and
set aside. Judgment is hereby rendered finding the defendants-appellees Jose
Modequillo and Benito Malubay jointly and severally liable to plaintiffs-appellants as
hereinbelow set forth. Accordingly, defendants-appellees are ordered to pay jointly
and severally to:

1. Plaintiffs-appellants, the Salinas spouses:

a. the amount of P30,000.00 by way of compensation for the death of their son Audie
Salinas;

b. P10,000.00 for the loss of earnings by reason of the death of said Audie Salinas;

c. the sum of P5,000.00 as burial expenses of Audie Salinas; and

d. the sum of P5,000.00 by way of moral damages.

2. Plaintiffs-appellants Culan-Culan:
 a. the sum of P5,000.00 for hospitalization expenses of Renato Culan- Culan; and

b. P5,000.00 for moral damages.

3. Both plaintiff-appellants Salinas and Culan-Culan, P7,000.00 for attorney's fees

and litigation expenses.

All counterclaims and other claims are hereby dismissed. 1

The said judgment having become final and executory, a writ of execution was issued by the
Regional Trial Court of Davao City to satisfy the said judgment on the goods and chattels of the
defendants Jose Modequillo and Benito Malubay at Malalag, Davao del Sur.

On July 7, 1988, the sheriff levied on a parcel of residential land located at Poblacion Malalag,
Davao del Sur containing an area of 600 square meters with a market value of P34,550.00 and
assessed value of P7,570.00 per Tax Declaration No. 87008-01359, registered in the name of Jose
Modequillo in the office of the Provincial Assessor of Davao del Sur; and a parcel of agricultural land
located at Dalagbong Bulacan, Malalag, Davao del Sur containing an area of 3 hectares with a
market value of P24,130.00 and assessed value of P9,650.00 per Tax Declaration No. 87-08-01848
registered in the name of Jose Modequillo in the office of the Provincial Assessor of Davao del Sur. 2

A motion to quash and/or to set aside levy of execution was filed by defendant Jose Modequillo
alleging therein that the residential land located at Poblacion Malalag is where the family home is
built since 1969 prior to the commencement of this case and as such is exempt from execution,
forced sale or attachment under Articles 152 and 153 of the Family Code except for liabilities
mentioned in Article 155 thereof, and that the judgment debt sought to be enforced against the
family home of defendant is not one of those enumerated under Article 155 of the Family Code. As
to the agricultural land although it is declared in the name of defendant it is alleged to be still part of
the public land and the transfer in his favor by the original possessor and applicant who was a
member of a cultural minority was not approved by the proper government agency. An opposition
thereto was filed by the plaintiffs.

In an order dated August 26, 1988, the trial court denied the motion. A motion for reconsideration
thereof was filed by defendant and this was denied for lack of merit on September 2, 1988.

Hence, the herein petition for review on certiorari wherein it is alleged that the trial court erred and
acted in excess of its jurisdiction in denying petitioner's motion to quash and/or to set aside levy on
the properties and in denying petitioner' motion for reconsideration of the order dated August 26,
1988. Petitioner contends that only a question of law is involved in this petition. He asserts that the
residential house and lot was first occupied as his family residence in 1969 and was duly constituted
as a family home under the Family Code which took effect on August 4, 1988. Thus, petitioner
argues that the said residential house and lot is exempt from payment of the obligation enumerated
in Article 155 of the Family Code; and that the decision in this case pertaining to damages arising
from a vehicular accident took place on March 16, 1976 and which became final in 1988 is not one
of those instances enumerated under Article 155 of the Family Code when the family home may be
levied upon and sold on execution. It is further alleged that the trial court erred in holding that the
said house and lot became a family home only on August 4, 1988 when the Family Code became
effective, and that the Family Code cannot be interpreted in such a way that all family residences are
deemed to have been constituted as family homes at the time of their occupancy prior to the
effectivity of the said Code and that they are exempt from execution for the payment of obligations
incurred before the effectivity of said Code; and that it also erred when it declared that Article 162 of
the Family Code does not state that the provisions of Chapter 2, Title V have a retroactive effect.

Articles 152 and 153 of the Family Code provide as follows:

Art. 152. The family home, constituted jointly by the husband and the wife or by an
unmarried head of a family, is the dwelling house where they and their family reside,
and the land on which it is situated.

Art. 153. The family home is deemed constituted on a house and lot from the time it
is occupied as a family residence. From the time of its constitution and so long as
any of its beneficiaries actually resides therein, the family home continues to be such
and is exempt from execution, forced sale or attachment except as hereinafter
provided and to the extent of the value allowed by law.

Under the Family Code, a family home is deemed constituted on a house and lot from the time it is
occupied as a family residence. There is no need to constitute the same judicially or extrajudicially
as required in the Civil Code. If the family actually resides in the premises, it is, therefore, a family
home as contemplated by law. Thus, the creditors should take the necessary precautions to protect
their interest before extending credit to the spouses or head of the family who owns the home.

Article 155 of the Family Code also provides as follows:

Art. 155. The family home shall be exempt from execution, forced sale or attachment
except:

(1) For non-payment of taxes;

(2) For debts incurred prior to the constitution of the family home;

(3) For debts secured by mortgages on the premises before or after such
constitution; and

(4) For debts due to laborers, mechanics, architects, builders, material men and
others who have rendered service or furnished material for the construction of the
building.

The exemption provided as aforestated is effective from the time of the constitution of the family
home as such, and lasts so long as any of its beneficiaries actually resides therein.

In the present case, the residential house and lot of petitioner was not constituted as a family home
whether judicially or extrajudicially under the Civil Code. It became a family home by operation of law
only under Article 153 of the Family Code. It is deemed constituted as a family home upon the
effectivity of the Family Code on August 3, 1988 not August 4, one year after its publication in the
Manila Chronicle on August 4, 1987 (1988 being a leap year).

The contention of petitioner that it should be considered a family home from the time it was occupied
by petitioner and his family in 1969 is not well- taken. Under Article 162 of the Family Code, it is
provided that "the provisions of this Chapter shall also govern existing family residences insofar as
said provisions are applicable." It does not mean that Articles 152 and 153 of said Code have a
retroactive effect such that all existing family residences are deemed to have been constituted as
family homes at the time of their occupation prior to the effectivity of the Family Code and are
exempt from execution for the payment of obligations incurred before the effectivity of the Family
Code. Article 162 simply means that all existing family residences at the time of the effectivity of the
Family Code, are considered family homes and are prospectively entitled to the benefits accorded to
a family home under the Family Code. Article 162 does not state that the provisions of Chapter 2,
Title V have a retroactive effect.

Is the family home of petitioner exempt from execution of the money judgment aforecited No. The
debt or liability which was the basis of the judgment arose or was incurred at the time of the
vehicular accident on March 16, 1976 and the money judgment arising therefrom was rendered by
the appellate court on January 29, 1988. Both preceded the effectivity of the Family Code on August
3, 1988. This case does not fall under the exemptions from execution provided in the Family Code.

As to the agricultural land subject of the execution, the trial court correctly ruled that the levy to be
made by the sheriff shall be on whatever rights the petitioner may have on the land.

WHEREFORE, the petition is DISMISSED for lack of merit. No pronouncement as to costs.

SO ORDERED.

Narvasa (Chairman), Cruz and Medialdea, JJ., concur. Griño-Aquino, J., is on leave.

TANEO JR. v. CA
Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 108532 March 9, 1999

PABLITO TANEO, JR., JOSE TANEO, NENA T. CATUBIG and HUSBAND, CILIA T. MORING
and HUSBAND, petitioners,
vs.
COURT OF APPEALS and ABDON GILIG, respondents.

KAPUNAN, J.:

The issues in this case are not novel: whether or not the conveyance made by way of the sheriff's
sale pursuant to the writ of execution issued by the trial court in Civil Case No. 590 is prohibited
under Sec. 118 of Commonwealth Act No. 141; and whether or not the family home is exempt from
execution.

As a result of a judgment in Civil Case No. 590 (for recovery of property) in favor of private
respondent, two (2) of petitioners' properties were levied to satisfy the judgment amount of about
P5,000.00: one was a parcel of land located in Barrio Igpit, Municipality of Opol, Misamis Oriental
with an area of about five (5) hectares, and the other was the family home also located at Igpit, Opol,
Misamis Oriental. The subject properties were sold at public auction on February 12, 1966 to the
private respondent as the highest bidder. Consequently, after petitioners' failure to redeem the
same, a final deed of conveyance was executed on February 9, 1968, definitely selling, transferring,
and conveying said properties to the private respondent.

To forestall such conveyance, petitioners filed an action on November 5, 1985 (docketed as Civil
Case No. 10407) to declare the deed of conveyance void and to quiet title over the land with a
prayer for a writ of preliminary injunction. In their complaint, it was alleged that petitioners are the
children and heirs of Pablo Taneo and Narcisa Valaceras who died on February 12, 1977 and
September 12, 1984, respectively. Upon their death, they left the subject property covered by OCT
No. P-12820 and Free Patent No. 548906. Considering that said property has been acquired
through free patent, such property is therefore inalienable and not subject to any encumbrance for
the payment of debt, pursuant to Commonwealth Act No. 141. Petitioners further alleged that they
were in continuous, open and peaceful possession of the land and that on February 9, 1968. Deputy
Provincial Sheriff Jose V. Yasay issued a Sheriffs Deed of Conveyance in favor of the private
respondent over the subject property including their family home which was extrajudicially
constituted in accordance with law. As a result of the alleged illegal deed of conveyance, private
respondent was able to obtain in his name Tax Declaration No. 851920 over the land, thus casting a
cloud of doubt over the title and ownership of petitioners over said property.

Private respondent refuted petitioners' contentions alleging that he lawfully acquired the subject
properties described as Lot No. 5545, Cad. 237 which was a private land, by virtue of a Sheriffs Sale
on February 12, 1996. Said sale has become final as no redemption was made within one year from
the registration of the Sheriffs Certificate of Sale. The validity of the sale in favor of Abdon Gilig was
even confirmed by the Court of Appeals in a related case (CA No. 499965-R) entitled "Arriola v.
Gilig," where one Rufino Arriola also claimed ownership over the subject property.

Private respondent averred that the subject land was originally owned by Lazaro Ba-a who sold the
land to Pablo Taneo on September 18, 1941, as evidenced by an Escritura de Venta. Despite it
being a private land, Pablo Taneo filed an application for free patent which was final only in 1979.

As counterclaim, private respondent alleged that since petitioners are still in possession of the
subject property, he has been deprived of acts of ownership and possession and therefore, prayed
for payment of rentals from February, 1968 until possession has been restored to them.

In its decision of March 27, 1989, the RTC dismissed the complaint.

The dispositive portion thereof reads as follows:

Premises considered, Judgment is hereby rendered in favor of the defendant and

against the plaintiffs, ordering the dismissal of the complaint filed by the plaintiffs;

a) Declaring OCT No. P-12820 and Free Patent No 548906 both in

the name of Pablo Taneo as null and void and directing the Register
 of Deeds to cancel the same, without prejudice however on the part
of the defendant to institute legal proceedings for the transfer of the
said title in the name of defendant Abdon Gilig;

b) Declaring Abdon Gilig as the absolute and legal owner of the land
covered by OCT No. P-12820, and covered by Tax Declaration No.
851920, and hence entitled to the possession of the same and as a
necessary concomitant, admonishing the plaintiffs to refrain from
disturbing the peaceful possession of the defendant over the land in
question.

c) Likewise declaring the defendant Abdon Gilig as the true and

absolute owner of the house in question formerly declared under Tax
Declaration No. 4142 in the name of Pablo Taneo and presently
declared under Tax Declaration No 851916 in the name of Abdon
Gilig; ordering the plaintiffs or any of their representatives to vacate
and return the possession of the same to defendant Abdon Gilig;

d) Ordering the plaintiffs, except the nominal parties herein, to pay to

defendant Abdon Gilig the amount of P500.00 a month as reasonable
rental of the house in question to be reckoned from February 9, 1968
until the possession of the same is returned to the defendant.

e) To pay to defendant the amount of P5,000.00 as attorney's fees

and to pay the costs.

SO ORDERED. 1

On appeal, the Court of Appeals affirmed in toto the decision of the RTC.

Hence, this petition.

The petition is devoid of merit.

In resolving the issues, the lower court made the following findings of fact which this Court finds no
cogent reason to disturb:

1. That the land in question originally belonged to Lazaro Ba-a who

sold the same to the late Pablito (sic) Taneo father of the herein
plaintiff on September 18, 1941, by virtue of an Escritura de Venta
identified as Reg. Not. 50; pages 53, Foleo Not. V, Series of 1941 of
the Notarial Register of Ernie Pelaez (Exh. 10);

2. That on July 19, 1951 Abdon Gilig with his wife filed a Civil Case
No. 590 for recovery of property against Pablo Taneo, et al., wherein
Judgment was rendered on June 24, 1964, in favor of Abdon Gilig
and against Pablo Taneo ordering the latter to pay damages in the
amount of P5,000.00 (Exh. 2);

3. That by virtue of said decision, a writ of Execution was issued on

 November 22, 1965 against the properties of Pablo Taneo and on
December 1, 1965, a Notice of Levy was executed by the Clerk of
Court Pedro Perez wherein the properties in question were among
the properties levied by the Sheriff (Exh 3);

4. That the said properties were sold at public auction wherein the
defendant Abdon Gilig came out as the highest bidder and on
February 12, 1965, a Sheriffs Certificate of Sale was executed by Ex-
Oficio Provincial Sheriff Pedro Perez (Exh. 1) ceding the said
properties in favor of Abdon Gilig and which Certificate of Sale was
registered with the Register of Deeds on March 2, 1966;

5. That for failure to redeem the said property within the reglementary
period, a Sheriffs final Deed of Conveyance was executed by same
Provincial Sheriff Jose V. Yasay on February 1968, (Exhs. 4, 4-A)
conveying the property definitely to Abdon Gilig.

6. That on April 20, 1966, after his third-party claim which he filed with
the Sheriff in Civil Case No. 590 was not given due course, Rufino
Arriola filed Civil Case No. 2667 entitled Arriola vs. Abdon Gilig, et al.,
for Recovery of Property and/or annulment of Sale with Damages;

7. That Judgment was rendered by the Court thru Judge Bernardo

Teves dismissing the case with costs on February 21, 1969;

8. That said decision was appealed to the Court of Appeals which

affirmed the decision in toto on June 20, 979, declaring the alleged
Deed of Sale executed by Abdon Gilig in favor of the plaintiff as null
and void for being simulated or fictitious and executed in fraud or (sic)
creditors;

9. That on March 7, 1964, Pablo Taneo constituted the house in

question erected on the land of Plutarco Vacalares as a family home
(Exh. F) but was however, notarized only on May 2, 1965 and
registered with the Register of Deeds on June 24, 1966.

10. That in the meanwhile, unknown to the defendant, Pablo Taneo

applied for a free patent on the land in question which was approved
on October 13, 1973, (Exh. B) and the Patent and Title issued on
December 10, 1980 (Oct No. P-12820 - Exh. 12);

11. On November 3, 1985, the plaintiff filed the present action. 2

Petitioners contend that under Section 118 of Commonwealth Act No. 141, the subject land which
they inherited from their father under free patent cannot be alienated or encumbered in violation of
the law. Citing in particular the cases of Oliveros v. Porciongcola and Gonzaga v. Court of
3

Appeals, the execution or auction sale of the litigated land falls within the prohibited period and is.
4

likewise, a disavowal of the rationale of the law which is to give the homesteader or patentee every
chance to preserve for himself and his family the land which the State had gratuitously given to him
as a reward for his labor in cleaning and cultivating it. 5

We are not unmindful of the intent of the law. In fact, in Republic v. Court of Appeals, the Court
6

elucidated, to wit:

It is well-known that the homestead laws were designed to distribute disposable

agricultural lots of the State to land-destitute citizens for their home and cultivation.
Pursuant to such benevolent intention the State prohibits the sale or encumbrance of
the homestead (Section 116) within five years after the grant of the patent. After that
five-year period the law impliedly permits alienation of the favor homestead; but in
line with the primordial purpose to favor the homesteader and his family the statute
provides that such alienation or conveyance (Section 117) shall be subject to the
right of repurchase by the homesteader, his widow of heirs within five years. This
Section 117 is undoubtedly a complement of Section 116. It aims to preserve and
keep in the family of the homesteader that portion of public land which the State had
gratuitously given to him. It would, therefore, be in keeping with this fundamental idea
to hold, as we hold, that the right to repurchase exists not only when the original
homesteader makes the conveyance, but also when it is made by his widow or heirs.
This construction is clearly deducible from the terms of the statute.

The intent of the law is undisputable but under the facts of the case, the prohibition invoked by the
petitioners under Section 118 does not apply to them.

Sec. 118 of Commonwealth Act No. 141 reads:

Except in favor of the Government or any of its branches, units or institution, or

legally constituted banking corporations, lands acquired under free patent or
homestead provisions shall not be subject to encumbrance or alienation from the
date of the approval of the application and for a term of five years from and after the
date of issuance of the patent or grant, nor shall they become liable to the
satisfaction of any debt contracted prior to the expiration of said period, but the
improvements or crops on the land may be mortgaged or pledged to qualified
persons, associations, or corporations.

xxx xxx xxx

The prohibition against alienation of lands acquired by homestead or free patent commences on the
date of the approval of the application for free patent and the five-year period is counted from the
issuance of the patent. The reckoning point is actually the date of approval of the application.
In Amper v. Presiding Judge, the Court held that:
7

. . . The date when the prohibition against the alienation of lands acquired by
homesteads or free patents commences is "the date of the approval of the
application" and the prohibition embraces the entire five-year period "from and after
the date of issuance of the patent or, grant." As stated in Beniga v. Bugas, (35 SCRA
111), the provision would make no sense if the prohibition starting "from the date of
the approval of the application" would have no termination date.

The specific period of five years within which the alienation or encumbrance of a
homestead is restricted starts to be computed from the date of the issuance of the
 patent. But the prohibition of alienation commences from the date the application is
approved which comes earlier. (Emphasis ours.)

Following this ruling, we agree with the respondent court that the conveyance made by way of the
sheriff's sale was not violative of the law. The judgment obligation of the petitioners against Abdon
Gilig arose on June 24, 1964. The properties were levied and sold at public auction with Abdon Gilig
as the highest bidder on February 12, 1966. On February 9, 1968, the final deed of conveyance
ceding the subject property to Abdon Gilig was issued after the petitioners failed to redeem the
property after the reglementary period. Pablo Taneo`s application for free parent was approved only
on October 19, 1973.

The sequence of the events leads us to the inescapable conclusion that even before the application
for homestead had been approved, Pablo Taneo was no longer the owner of the land. The deed of
conveyance issued on February 9, 1968 finally transferred the property to Abdon Gilig. As of that
date, Pablo Taneo did not actually have transferred to herein petitioners. The petitioners are not the
owners of the land and cannot claim to be such by invoking Commonwealth Act No. 141. The
prohibition does not apply since it is clear from the records that the judgment debt and the execution
sale took place prior to the approval of the application for free patent. We quote with favor the
respondent court's valid observation on the matter:

. . . the application of Pablo Taneo for a free patent was approved only on 19
October 1973 and Free Patent was issued on 10 December 1980. Under the
aforecited provision, the subject land could not be made liable for the satisfaction of
any debt contracted from the time of the application and during the 5-year period
following 10 December 1980, or until 10 December 1985. However, debts contracted
prior to the approval of the application for free patent, that is prior to 18 October
1973, are not covered by the prohibition. This is because they do not fall within the
scope of the prohibited period. In this case, the judgment debt in favor of defendant-
appellee was rendered on 24 June 1964, the writ of execution issued on 22
November 1965, notice of levy made on 1 December 1965, the execution sale held
on 12 February 1966, and the certificate of sale registered on 2 March 1966, all
before Pablo Taneo's application for free patent was approved on 19 October 1973.
The execution, therefore, was not violative of the law. 8

Anent the second issue, petitioners aver that the house which their father
constituted as family home is exempt from execution. In a last ditch effort to save
their property, petitioners invoke the benefits accorded to the family home under
the Family Code.

A family home is the dwelling place of a person and his family. It is said, however, that the family
home is a real right, which is gratuitous, inalienable and free from attachment, constituted over the
dwelling place and the land on which it is situated, which confers upon a particular family the right to
enjoy such properties, which must remain with the person constituting it and his heirs. It cannot be
9

seized by creditors except in certain specials cases.

Under the Civil Code (Articles 224 to 251), a family home may be constituted judicial and
extrajudicially, the former by the filing of the petition and with the approval of the proper court, and
the latter by the recording of a public instrument in the proper registry of property declaring the
establishment of the family home. The operative act then which created the family home
extrajudicially was the registration in the Registry of Property of the declaration prescribed by
Articles 240 and 241 of the Civil Code. 10

Under the Family Code, however. registration was no longer necessary Article 153 of the Family
Code provides that the family home is deemed constituted on a house and lot from the time it is
occupied in the family. It reads:

The family home is deemed constituted on a house and lot from the time it is
occupied as family residence. From the time of its constitution and so long as its
beneficiaries actually resides therein, the family home continues to be such and is
exempt from execution, forced sale or attachment, except as hereinafter provided
and to the extent of the value allowed by law.

It is under the foregoing provision which petitioners seek refuge to avert execution of the family
home arguing that as early as 1964, Pablo Taneo had already constituted the house in question as
their family home. However, the retroactive effect of the Family Code, particularly on the provisions
on the family home has been clearly laid down by the court as explained in the case of Manacop v.
Court of Appeals to wit:
11

Finally, the petitioner insists that the attached property is a family home, having been
occupied by him and his family since 1972, and is therefore exempt from attachment.

The contention is not well-taken.

While Article 153 of the Family Code provides that the family home is deemed
constituted on a house and lot from the time it is occupied as a family residence, it
does not mean that said article has a retroactive effect such that all existing family
residences, petitioner's included, are deemed to have been constituted as family
homes at the time of their occupation prior to the effectivity of the Family Code and
henceforth, are exempt from execution for the payment of obligations incurred before
the effectivity of the Family Code on August 3, 1988 (Mondequillo vs. Breva, 185
SCRA 766). Neither does Article 162 of said Code state that the provisions of
Chapter 2, Title V thereof have retroactive effect. It simply means that all existing
family residences at the time of the effectivity of the Family Code are considered
family homes and are prospectively entitled to the benefits accorded to a family
home under the Family Code (Modequillo vs. Breva, supra). Since petitioner's debt
was incurred as early as November 25, 1987, it preceded the effectivity of the Family
Code. His property is therefore not exempt from attachment (Annex "O," Plaintiff's
Position Paper and Memorandum of Authorities, p. 78)." (pp. 5-6, Decision; pp. 64-
65, Rollo) (emphasis ours)

The applicable law, therefore. in the case at bar is still the Civil Code where registration of the
declaration of a family home is a prerequisite. Nonetheless, the law provides certain instances where
the family home is not exempted from execution, forced sale or attachment.

Art. 243 reads:

The family home extrajudicially formed shall be exempt from execution, forced sale
or attachment, except:
 (1) For nonpayment of taxes;

(2) For debts incurred before the declaration was recorded in the Registry of
Property;

(3) For debts secured by mortgages on the premises before or after such record of
the declaration;

(4) For debts due to laborers, mechanics, architects, builders, material-men and
others who have rendered service or furnished material for the construction of the
building.12

The trial court found that on March 7, 1964, Pablo Taneo constituted the house in question, erected
on the land of Plutarco Vacalares, as the family home. The instrument constituting the family home
was registered only on January 24, 1966. The money judgment against Pablo Taneo was rendered
on January 24, 1964. Thus, at that time when the "debt" was incurred, the family home was not yet
constituted or even registered. Clearly, petitioners' alleged family home, as constituted by their father
is not exempt as it falls under the exception of Article 243 (2).

Moreover, the constitution of the family home by Pablo Taneo is even doubtful considering that such
constitution did not comply with the requirements of the law. The trial court found that the house was
erected not on the land which the Taneos owned but on the land of one Plutarco Vacalares. By the
very definition of the law that the "family home is the dwelling house where a person and his family
resides and the land on which it is situated," it is understood that the house should be constructed
13

on a land not belonging to another. Apparently, the constitution of a family home by Pablo Taneo in
the instant case was merely an afterthought in order to escape execution of their property but to no
avail.

WHEREFORE, the petition is DENIED for lack of merit.

SO ORDERED.

Davide, Jr., C.J., Melo and Pardo, JJ., concur.

CABANG v. BASAY
Republic of the Philippines
SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 180587 March 20, 2009

SIMEON CABANG, VIRGINIA CABANG and VENANCIO CABANG ALIAS

"DONDON", Petitioners,
vs.
MR. & MRS. GUILLERMO BASAY, Respondents.
 DECISION

YNARES-SANTIAGO, J.:

This petition for review on certiorari under Rule 45 of the Rules of Court seeks to annul and set aside
the Decision of the Court of Appeals in CA-G.R. CV No. 767551 dated May 31, 20072 which reversed
the Order3 of the Regional Trial Court of Molave, Zamboanga Del Sur, Branch 23 in Civil Case No.
99-20-127 which denied respondents’ motion for execution on the ground that petitioners’ family
home was still subsisting. Also assailed is the Resolution dated September 21, 2007 denying the
motion for reconsideration.

The facts as summarized by the appellate court:

Deceased Felix Odong was the registered owner of Lot No. 7777, Ts- 222 located in Molave,
Zamboanga del Sur. Said lot was covered by Original Certificate of Title No. 0-2,768 pursuant to
Decree No. N-64 and issued on March 9, 1966. However, Felix Odong and his heirs never occupied
nor took possession of the lot.

On June 16, 1987, plaintiff-appellants bought said real property from the heirs of Felix Odong for
P8,000.00. Consequently, OCT No. 0-2,768 was cancelled and in its stead, Transfer Certificate of
Title No. T-22,048 was issued on August 6, 1987 in the name of plaintiff-appellants. The latter also
did not occupy the said property.

Defendant-appellees, on the other hand, had been in continuous, open, peaceful and adverse
possession of the same parcel of land since 1956 up to the present. They were the awardees in the
cadastral proceedings of Lot No. 7778 of the Molave Townsite, Ts-222. During the said cadastral
proceedings, defendant-appellees claimed Lot No. 7778 on the belief that the area they were
actually occupying was Lot No. 7778. As it turned out, however, when the Municipality of Molave
relocated the townsite lots in the area in 1992 as a big portion of Lot No. 7778 was used by the
government as a public road and as there were many discrepancies in the areas occupied, it was
then discovered that defendant-appellees were actually occupying Lot No. 7777.

On June 23, 1992, plaintiff-appellants filed a Complaint docketed as Civil Case No. 92-20-127 for
Recovery of Property against defendant-appellees.

On July 19, 1996, the trial court rendered its decision, the dispositive portion of which reads, thus:

WHEREFORE, judgment is hereby rendered in favor of the defendants and against the plaintiff –

1. Holding that the rights of the plaintiffs to recover the land registered in their names, have
been effectively barred by laches; and

2. Ordering the dismissal of the above-entitled case.

No pronouncement as to cost.

SO ORDERED.

Aggrieved, plaintiff-appellants filed an appeal before the Court of Appeals assailing the above-
decision. Said appeal was docketed as CA-G.R. CV No. 55207.

On December 23, 1998, the Court of Appeals, through the then Second Division, rendered a
Decision reversing the assailed decision and decreed as follows:

WHEREFORE, the judgment herein appealed from is hereby REVERSED, and judgment is hereby
rendered declaring the plaintiffs-appellants to be entitled to the possession of Lot No. 7777 of the
Molave Townsite, subject to the rights of the defendants-appellees under Article (sic) 448, 546, 547
and 548 of the New Civil Code.

The records of this case are hereby ordered remanded to the court of origin for further proceedings
to determine the rights of the defendants-appellees under the aforesaid article (sic) of the New Civil
Code, and to render judgment thereon in accordance with the evidence and this decision.

No pronouncement as to costs.

SO ORDERED.

Defendant-appellees thereafter filed a petition for review on certiorari under Rule 45 of the Rules of
Court before the Supreme Court docketed as G.R. No. 139601. On October 18, 1999, the Supreme
Court issued a Resolution denying the petition for late filing and lack of appropriate service.

Subsequently, or on February 15, 2000, the Supreme Court Resolution had become final and
executory.

Consequently, the case was remanded to the court a quo and the latter commissioned the Municipal
Assessor of Molave, Zamboanga del Sur to determine the value of the improvements introduced by
the defendant-appellees.

The Commissioner’s Report determined that at the time of ocular inspection, there were three (3)
residential buildings constructed on the property in litigation. During the ocular inspection, plaintiff-
appellants’ son, Gil Basay, defendant-appellee Virginia Cabang, and one Bernardo Mendez, an
occupant of the lot, were present. In the report, the following appraised value of the improvements
were determined, thus:
lawphil.net

Owner Lot No. Area (sq.m.) Improvement Appraised Value

Virginia Cabang 7777 32.55 Building P21,580.65
Jovencio Capuno 7777 15.75 Building 18,663.75
Amelito Mata 7777 14.00 Building 5,658.10
Toilet 1,500.00
Plants & Trees 2,164.00

TOTAL P49,566.50
Thereafter, upon verbal request of defendant-appellees, the court a quo in its Order declared that
the tie point of the survey should be the BLLM (Bureau of Lands Location Monument) and
authorized the official surveyor of the Bureau of Lands to conduct the survey of the litigated property.

Pursuant to the above Order, the Community Environment and Natural Resources Office (CENRO)
of the Department of Environment and Natural Resources (DENR)-Region XI designated Geodetic
Engineer Diosdado L. de Guzman to [act] as the official surveyor. On March 2002, Engr. De
Guzman submitted his survey report which stated, inter alia:

1. That on September 18, 2001, the undersigned had conducted verification survey of Lot
7777, Ts-222 and the adjacent lots for reference purposes-with both parties present on the
survey;

2. That the survey was started from BLLM #34, as directed by the Order, taking sideshots of
lot corners, existing concrete fence, road and going back to BLLM #34, a point of reference;

3. Considering that there was only one BLLM existing on the ground, the undersigned
conducted astronomical observation on December 27, 2001 in order to check the carried
Azimuth of the traverse;

4. That per result of the survey conducted, it was found out and ascertained that the area
occupied by Mrs. Virginia Cabang is a portion of Lot 7777, with lot assignment to be known
as Lot 7777-A with an area of 303 square meters and portion of Lot 7778 with lot assignment
to be known as Lot 7778-A with an area of 76 square meters. On the same lot, portion of
which is also occupied by Mr. Bernardo Mendez with lot assignment to be known as Lot
7777-B with an area of 236 square meters and Lot 7778-B with an area of 243 square
meters as shown on the attached sketch for ready reference;

5. That there were three (3) houses made of light material erected inside Lot No. 7777-A,
which is owned by Mrs. Virginia Cabang and also a concrete house erected both on portion
of Lot No. 7777-B and Lot No. 7778-B, which is owned by Mr. Bernardo Mendez. x x x;

6. That the existing road had been traversing on a portion of Lot 7778 to be know (sic) as Lot
7778-CA-G.R. SP No. with an area of 116 square meters as shown on attached sketch plan.

During the hearing on May 10, 2002, plaintiff-appellants’ offer to pay P21,000.00 for the
improvement of the lot in question was rejected by defendant-appellees. The court a quo disclosed
its difficulty in resolving whether or not the houses may be subject of an order of execution it being a
family home.

On June 18, 2002, plaintiff-appellants filed their Manifestation and Motion for Execution alleging
therein that defendant-appellees refused to accept payment of the improvements as determined by
the court appointed Commissioner, thus, they should now be ordered to remove said improvements
at their expense or if they refused, an Order of Demolition be issued.

On September 6, 2002, the court a quo issued the herein assailed Order denying the motion for
execution.4

Respondents thereafter elevated their cause to the appellate court which reversed the trial court in
its May 31, 2007 Decision in CA-G.R. CV No. 76755. Petitioners’ Motion for Reconsideration was
denied by the Court of Appeals in its Resolution5 dated September 21, 2007.
Hence, this petition.

Petitioners insist that the property subject of the controversy is a duly constituted family home which
is not subject to execution, thus, they argue that the appellate tribunal erred in reversing the
judgment of the trial court.

The petition lacks merit.

It bears stressing that the purpose for which the records of the case were remanded to the court of
origin was for the enforcement of the appellate court’s final and executory judgment 6 in CA-G.R. CV
No. 55207 which, among others, declared herein respondents entitled to the possession of Lot No.
7777 of the Molave Townsite subject to the provisions of Articles 448, 7 546,8 5479 an 54810 of the Civil
Code. Indeed, the decision explicitly decreed that the remand of the records of the case was for the
court of origin "[t]o determine the rights of the defendants-appellees under the aforesaid article[s] of
the New Civil Code, and to render judgment thereon in accordance with the evidence and this
decision."

A final and executory judgment may no longer be modified in any respect, even if the modification is
meant to correct erroneous conclusions of fact or law and whether it will be made by the court that
rendered it or by the highest court in the land.11 The only exceptions to this rule are the correction of
(1) clerical errors; (2) the so-called nunc pro tunc entries which cause no prejudice to any party, and
(3) void judgments.12

Well-settled is the rule that there can be no execution until and unless the judgment has become
final and executory, i.e. the period of appeal has lapsed without an appeal having been taken, or,
having been taken, the appeal has been resolved and the records of the case have been returned to
the court of origin, in which event, execution shall issue as a matter of right. 13 In short, once a
judgment becomes final, the winning party is entitled to a writ of execution and the issuance thereof
becomes a court’s ministerial duty.14

Furthermore, as a matter of settled legal principle, a writ of execution must adhere to every essential
particulars of the judgment sought to be executed.15 An order of execution may not vary or go
beyond the terns of the judgment it seeks to enforce.16 A writ of execution must conform to the
judgment and if it is different from, goes beyond or varies the tenor of the judgment which gives it
life, it is a nullity.17 Otherwise stated, when the order of execution and the corresponding writ issued
pursuant thereto is not in harmony with and exceeds the judgment which gives it life, they have pro
tanto no validity18 – to maintain otherwise would be to ignore the constitutional provision against
depriving a person of his property without due process of law.19

As aptly pointed out by the appellate court, from the inception of Civil Case No. 99-20-127, it was
already of judicial notice that the improvements introduced by petitioners on the litigated property are
residential houses not family homes. Belatedly interposing such an extraneous issue at such a late
stage of the proceeding is tantamount to interfering with and varying the terms of the final and
executory judgment and a violation of respondents’ right to due process because –

As a general rule, points of law, theories and issues not brought to the attention of the trial court
cannot be raised for the first time on appeal. For a contrary rule would be unfair to the adverse party
who would have no opportunity to present further evidence material to the new theory, which it could
have done had it been aware of if at the time of the hearing before the trial court. 20
lawphil.net
The refusal, therefore, of the trial court to enforce the execution on the ground that the
improvements introduced on the litigated property are family homes goes beyond the pale of what it
had been expressly tasked to do, i.e. its ministerial duty of executing the judgment in accordance
with its essential particulars. The foregoing factual, legal and jurisprudential scenario reduces the
raising of the issue of whether or not the improvements introduced by petitioners are family homes
into a mere afterthought.

Even squarely addressing the issue of whether or not the improvements introduced by petitioners on
the subject land are family homes will not extricate them from their predicament.

As defined, "[T]he family home is a sacred symbol of family love and is the repository of cherished
memories that last during one’s lifetime.21 It is the dwelling house where the husband and wife, or an
unmarried head of a family reside, including the land on which it is situated. 22 It is constituted jointly
by the husband and the wife or by an unmarried head of a family."23 Article 153 of the Family Code
provides that –

The family home is deemed constituted from the time it is occupied as a family residence. From the
time of its constitution and so long as any of its beneficiaries actually resides therein, the family
home continues to be such and is exempt from execution, forced sale or attachment except as
hereinafter provided and to the extent of the value allowed by law.

The actual value of the family home shall not exceed, at the time of its constitution, the amount of
P300,000.00 in urban areas and P200,000.00 in rural areas.24 Under the afore-quoted provision, a
family home is deemed constituted on a house and a lot from the time it is occupied as a family
residence. There is no need to constitute the same judicially or extra-judicially. 25

There can be no question that a family home is generally exempt from execution, 26 provided it was
duly constituted as such. It is likewise a given that the family home must be constituted on property
owned by the persons constituting it. Indeed as pointed out in Kelley, Jr. v. Planters Products,
Inc.27 "[T]he family home must be part of the properties of the absolute community or the conjugal
partnership, or of the exclusive properties of either spouse with the latter’s consent, or on the
property of the unmarried head of the family."28 In other words:

The family home must be established on the properties of (a) the absolute community, or (b) the
conjugal partnership, or (c) the exclusive property of either spouse with the consent of the other. It
cannot be established on property held in co-ownership with third persons. However, it can be
established partly on community property, or conjugal property and partly on the exclusive property
of either spouse with the consent of the latter. 1avvphi1

If constituted by an unmarried head of a family, where there is no communal or conjugal property

existing, it can be constituted only on his or her own property.29 (Emphasis and italics supplied)

Therein lies the fatal flaw in the postulate of petitioners. For all their arguments to the contrary, the
stark and immutable fact is that the property on which their alleged family home stands is owned by
respondents and the question of ownership had been long laid to rest with the finality of the
appellate court’s judgment in CA-G.R. CV No. 55207. Thus, petitioners’ continued stay on the
subject land is only by mere tolerance of respondents.

All told, it is too late in the day for petitioners to raise this issue. Without doubt, the instant case
where the family home issue has been vigorously pursued by petitioners is but a clear-cut ploy
meant to forestall the enforcement of an otherwise final and executory decision. The execution of a
final judgment is a matter of right on the part of the prevailing party whose implementation is
mandatory and ministerial on the court or tribunal issuing the judgment. 30

The most important phase of any proceeding is the execution of judgment. 31 Once a judgment
becomes final, the prevailing party should not, through some clever maneuvers devised by an
unsporting loser, be deprived of the fruits of the verdict.32 An unjustified delay in the enforcement of a
judgment sets at naught the role of courts in disposing of justiciable controversies with
finality.33 Furthermore, a judgment if not executed would just be an empty victory for the prevailing
party because execution is the fruit and end of the suit and very aptly called the life of the law. 34

The issue is moreover factual and, to repeat that trite refrain, the Supreme Court is not a trier of
facts. It is not the function of the Court to review, examine and evaluate or weigh the probative value
of the evidence presented. A question of fact would arise in such event. Questions of fact cannot be
raised in an appeal via certiorari before the Supreme Court and are not proper for its
consideration.35 The rationale behind this doctrine is that a review of the findings of fact of the
appellate tribunal is not a function this Court normally undertakes. The Court will not weigh the
evidence all over again unless there is a showing that the findings of the lower court are totally
devoid of support or are clearly erroneous so as to constitute serious abuse of discretion. 36 Although
there are recognized exceptions37 to this rule, none exists in this case to justify a departure
therefrom.

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated May 31, 2007 in
CA-G.R. CV No. 76755 declaring respondents entitled to the writ of execution and ordering
petitioners to vacate the subject property, as well as the Resolution dated September 21, 2007
denying the motion for reconsideration, are AFFIRMED. Costs against petitioners.

SO ORDERED.

CONSUELO YNARES-SANTIAGO
Associate Justice

WE CONCUR:

MA. ALICIA AUSTRIA-MARTINEZ

Associate Justice

DANTE O. TINGA* ANTONIO EDUARDO B. NACHURA

Associate Justice Associate Justice
DIOSDADO M. PERALTA
Associate Justice

ATTESTATION

I attest that the conclusions in the above decision were reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.

CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division

EULOGIO v. BELL
FIRST DIVISION

G.R. No. 186322, July 08, 2015

ENRICO S. EULOGIO AND NATIVIDAD V. EULOGIO, Petitioners, v. PATERNO C.

BELL, SR., ROGELIA CALINGASAN-BELL, PATERNO WILLIAM BELL, JR.,
FLORENCE FELICIA VICTORIA BELL, PATERNO FERDINAND BELL III, AND
PATERNO BENERAÑO BELL IV, Respondents.

DECISION

SERENO, C.J.:

This is a Petition for Review on Certiorari assailing the Court of Appeals (CA) Decision 1 in
CA-G.R. SP No. 87531 which granted the Petition for Certiorari filed by respondents and
enjoined the execution sale of their family home for the satisfaction of the money
judgment awarded to petitioners in Civil Case No. 4581, and the Resolution 2 which
denied petitioners' Motion for Reconsideration.

Antecedent Facts

Respondents Paterno William Bell, Jr., Florence Felicia Victoria Bell, Paterno Ferdinand
Bell III, and Paterno Benerano IV (the Bell siblings) are the unmarried children of
respondent Spouses Paterno C. Bell and Rogelia Calingasan-Bell (Spouses Bell). In 1995,
the Bell siblings lodged a Complaint for annulment of documents, reconveyance,
quieting of title and damages against petitioners Enrico S. Eulogio and Natividad Eulogio
(the Eulogios). It was docketed as Civil Case No. 4581 at the Regional Trial Court (RTC)
of Batangas City, Branch 84. The Complaint sought the annulment of the contract of
sale executed by Spouses Bell over their 329-square-meter residential house and lot, as
well as the cancellation of the title obtained by petitioners by virtue of the Deed.

The RTC granted respondents' prayers, but declared Spouses Bell liable to petitioners in
the amount of PI million plus 12% interest per annum. The dispositive portion of the
Decision dated 15 July 1998 reads as follows: chanRoblesvirtualLawlibrary

WHEREFORE, prescinding from all the foregoing, the Court hereby declares: ChanRoblesVirtualawlibrary

1. That the sale of the subject house and lot under Deed of Sale marked as Exhibit "F" is
only an equitable mortgage in favor of the defendants Enrico Eulogio and Natividad
Eulogio. However, the mortgage cannot bind the property in question for being violative
of Chapter 2, Title 4 of the Family Code, its encumbrance not having been consented to
in writing by a majority of the beneficiaries who are the plaintiffs herein;

2. The said equitable mortgage is deemed to be an unsecured mortgage [sic] for which
the Spouses Paterno C. Bell, Sr. and Rogelia Calingasan Bell as mortgagors are liable to
the defendants-spouses Enrico Eulogio and Natividad Eulogio in the amount of
P1,000,000 plus interest of 12% per annum. However, under the Fourth Party Complaint
Sps. Paterno C. Bell, Sr. and Rogelia Calingasan Bell have the right of reimbursement
from fourth party defendants Nicolas Moraña and Julieta Moraña for whom their loan of
P1,000,000 was secured by Sps. Paterno C. Bell, Sr. and Rogelia Calingasan Bell.
Accordingly, the fourth party defendants Nicolas Moraña and Julieta Moraña are hereby
ordered to reimburse Paterno C. Bell, Sr. and Rogelia Calingasan Bell the loan of
P1,000,000 plus interest of 12% per annum to be paid by the latter to defendants Enrico
and Natividad Eulogio;

3. The house and lot in question is free from any and all encumbrances by virtue of said
equitable mortgage or the purported sale; and

4. The Deed of Sale (Exhibit "F") is null and void for being contrary to law and public
policy.

Accordingly, (1) the Register of Deeds of Batangas City is hereby ordered to cancel
Transfer Certificate of Title No. T-131472 in the name of defendants Enrico S. Eulogio
and Natividad Eulogio and to reconstitute (sic) Transfer Certificate of Title No. RT-680-
(5997) as "family home" of the plaintiffs Florence Felicia Victoria C. Bell, Paterno William
C. Bell Jr., Paterno Ferdinand C. Bell III, Paterno Benerano C. Bell IV and fourth party
plaintiffs Paterno C. Bell Sr. and Rogelia Calingasan Bell; or in the alternative to issue a
new Transfer Certificate of Title under the same tenor;

2. The City Assessor of Batangas City is hereby directed to issue a tax declaration
covering the said subject property as family home for the said plaintiffs and fourth party
plaintiffs Paterno C. Bell and Rogelia Calingasan Bell; and

3. Defendants Enrico Eulogio and Natividad Eulogio are ordered to pay the plaintiffs
attorney's fees and litigation expenses of P35,000.00, as the plaintiffs have been
compelled to litigate to protect their property rights, and costs. 3
Both petitioners and respondents appealed to the CA, but the trial court's Decision was
affirmed en toto. Spouses Bell later brought the case to this Court to question their
liability to petitioners in the amount of P1 million plus interest. The Court, however,
dismissed their Petition for failure to show any reversible error committed by the
CA.4 Thereafter, entry of judgment was made.5 chanrobleslaw

On 9 June 2004 the RTC issued a Writ of Execution, as a result of which respondents'
property covered by the newly reconstituted Transfer Certificate of Title (TCT) No.
54208 [formerly RT-680 (5997)] was levied on execution. Upon motion by respondents,
the trial court, on 31 August 2004, ordered the lifting of the writ of execution on the
ground that the property was a family home.6 chanrobleslaw

Petitioners filed a Motion for Reconsideration of the lifting of the writ of execution.
Invoking Article 160 of the Family Code, they posited that the current market value of
the property exceeded the statutory limit of P300,000 considering that it was located in
a commercial area, and that Spouses Bell had even sold it to them for P1 million. 7 chanrobleslaw

The RTC, on 13 October 2004, set the case for hearing to determine the present value
of the family home of respondents. It also appointed a Board of Appraisers to conduct a
study on the prevailing market value of their house and lot. 8 chanrobleslaw

Respondents sought reconsideration of the above directives and asked the RTC to cite
petitioners for contempt because of forum-shopping. 9 They argued that petitioners' bid
to determine the present value of the subject property was just a ploy to re-litigate an
issue that had long been settled with finality.

The RTC, however, denied the Motion for Reconsideration 10 of respondents and directed
the commissioners to canvass prospective buyers of their house and lot. 11 chanrobleslaw

On 23 November 2004, respondents filed a Petition for Certiorari and Injunction before
the CA,12 where it was docketed as CA-G.R. SP No. 87531.

Subsequently, the RTC issued on 25 November 2004 an Order 13 dispensing with the
valuation report of the commissioners and directing the issuance of a writ of execution.
Consequently, respondents filed before the CA a Supplemental Petition with an urgent
prayer for a temporary restraining order.14 chanrobleslaw

The CA eventually enjoined15 the execution sale set on 22 December 200416 by the RTC.

On 31 July 2008, the CA rendered its Decision granting respondents' Petition

for Certiorari, but it rejected their theory that res judicata had already set in.

The appellate court ruled that the RTC Decision, which had become final and executory,
only declared respondents' house and lot as a family home. Since the issue of whether
it may be sold in execution was incidental to the execution of the aforesaid Decision,
there was as yet no res judicata.

Still, the CA found that the trial court committed grave abuse of discretion in ordering
the execution sale of the subject family home after finding that its present
value exceeded the statutory limit. The basis for the valuation of a family home under
Article 160, according to the appellate court, is its actual value at the time of its
constitution and not the market/present value; therefore, the trial court's order was
contrary to law.17chanrobleslaw

On 09 February 2009,18 the CA denied petitioners' Motion for Reconsideration. Hence,

this Petition.

Issues

The issues to be resolved are: (1) whether petitioners are guilty of forum-shopping; (2)
whether a hearing to determine the value of respondents' family home for purposes of
execution under Article 160 of the Family Code is barred under the principle of res
judicata; and (3) whether respondents' family home may be sold on execution under
Article 160 of the Family Code.

The Court's Ruling

The Court denies the Petition for lack of merit.

Petitioners are not guilty of forum-shopping.

Forum shopping can be committed in three ways: (1) by filing multiple cases based on
the same cause of action and with the same prayer, the previous case not having been
resolved yet (where the ground for dismissal is litis pendentia); (2) by filing multiple
cases based on the same cause of action and with the same prayer, the previous case
having been finally resolved (where the ground for dismissal is res judicata); and (3) by
filing multiple cases based on the same cause of action but with different prayers, or by
splitting of causes of action (where the ground for dismissal is also either litis
pendentia or res judicata).19chanrobleslaw

The essence of forum shopping is the filing of multiple suits involving the same parties
for the same cause of action, either simultaneously or successively, for the purpose of
obtaining a favorable judgment through means other than by appeal or
certiorari.20 Forum shopping does not apply to cases that arise from an initiatory or
original action that has been elevated by way of appeal or certiorari to higher or
appellate courts or authorities. This is so because the issues in the appellate courts
necessarily differ from those in the lower court, and the appealed cases are but a
continuation of the original case and treated as only one case. 21 chanrobleslaw

Respondents contend that the Decision in Civil Case No. 4581, which declared that
property in dispute was a family home, had long attained finality. Accordingly,
respondents maintain that petitioners' bid to re-litigate the present value of the
property in the course of the execution proceedings is barred by res judicata, and that
petitioners should be cited for contempt of court because of forum-shopping. 22 chanrobleslaw

Recall that although the trial court had nullified the Deed of Sale over respondents'
family home in Civil Case No. 4581 for lack of a written consent from its beneficiaries as
required under Article 158 of the Family Code, 23 the court still recognized the validity of
the transaction as an unsecured loan. Hence, it declared Spouses Bell liable to
petitioners in the amount of PI million plus 12% interest per annum.

Petitioners' bid to satisfy the above judgment cannot be considered an act of forum
shopping. Simply, the execution of a decision is just the fruit and end of a suit and is
very aptly called the life of the law. 24 It is not separate from the main case. Similarly, the
filing of the instant Petition as a continuation of the execution proceedings does not
constitute forum shopping. Seeking a reversal of an adverse judgment or order by
appeal or certiorari does not constitute forum shopping. Such remedies are sanctioned
and provided for by the rules.25 chanrobleslaw

Indeed, as will be presently discussed, the causes of action in the main proceedings in
Civil Case No. 4581 and the consequent execution proceedings are identical. Suffice it
to say, however, that the danger of a multiplicity of suits upon one and the same cause
of action, which the judicial policy against forum shopping seeks to prevent, does not
exist in this case.

Re-litigating the issue of the value of respondents' family home is barred by

res judicata.

Res judicata (meaning, a "matter adjudged") is a fundamental principle of law that

precludes parties from re-litigating issues actually litigated and determined by a prior
and final judgment.26 Under the 1997 Rules of Court, there are two aspects of res
judicata, namely: bar by prior judgment27 and conclusiveness of judgment.28 chanrobleslaw

There is "bar by prior judgment" when, as between the first case in which the judgment
has been rendered and the second case that is sought to be barred, there is an identity
of parties, subject matter, and causes of action. In this instance, the judgment in the
first case constitutes an absolute bar to the second action. The judgment or decree on
the merits of the court of competent jurisdiction concludes the litigation between the
parties, as well as their privies, and constitutes a bar to a new action or suit involving
the same cause of action before the same or any other tribunal. 29 chanrobleslaw

On the other hand, there is "conclusiveness of judgment" where there is an identity of

parties in the first and second cases, but no identity of causes of action. Under this rule,
the first judgment is conclusive only as to those matters actually and directly
controverted and determined and not as to matters merely involved therein. Stated
differently, any right, fact, or matter in issue directly adjudicated or necessarily
involved in the determination of an action before a competent court in which judgment
is rendered on the merits is conclusively settled by the judgment therein and cannot
again be litigated between the parties and their privies whether or not the claim,
demand, purpose, or subject matter of the two actions is the same. 30 chanrobleslaw

In this case, the trial court's final decision in Civil Case No. 4581 bars petitioners' move
to have the property in dispute levied on execution.

There is no question that the main proceedings in Civil Case No. 4581 and the
subsequent execution proceedings involved the same parties 31 and subject matter.32 For
these reasons, respondents argue that the execution sale of the property in dispute
under Article 160 of the Family Code is barred by res judicata, since the trial court has
already determined that the value of the property fell within the statutory limit.

The CA held that the trial court's Decision, which is indisputably final, only settled the
issue of whether the property in dispute was a family home. The CA ruled thus: chanRoblesvirtualLawlibrary

We rule that there is no res judicata.

At the outset, let it be emphasized that the decision of the trial court dated July 15,
1998, which has become final and executory, only declares the subject property as a
family home. As a matter of fact, private respondents never questioned that such
property is a family home, and consequently, the issue as to whether or not the
property is family home is settled and res judicata lies only with respect to this issue.

But the issue as to whether or not a family home could be the subject of an execution
sale was not resolved by the trial court. This issue[was] raised only when the writ of
execution was issued and hence, [was not] resolved with finality. Thus, the issue before
this Court is whether or not the [f]amily [h]ome of petitioners under the facts and
circumstances of the case could be the subject of a writ of execution and sold at public
auction.33
The Court disagrees with the CA.

"Cause of action" is the act or omission by which a party violates the right of
another.34 It may be argued that the cause of action in the main proceedings was the
sale of the property in dispute, while in the execution proceedings it was the
indebtedness of Spouses Bell to petitioners.

The settled rule, however, is that identity of causes of action does not mean absolute
identity. Otherwise, a party could easily escape the operation of res judicata by
changing the form of the action or the relief sought. 35 The test to determine whether the
causes of action are identical is to ascertain whether the same evidence will sustain
both actions, or whether there is an identity of the facts essential to the
maintenance of the two actions. If the same facts or evidence would sustain both,
the two actions are considered the same, and a judgment in the first case would be a
bar to the subsequent action. Hence, a party cannot, by varying the form of action or
adopting a different method of presenting the case, escape the operation of the
principle that one and the same cause of action shall not be twice litigated between the
same parties or their privies.36 chanrobleslaw

Among several tests resorted to in ascertaining whether two suits relate to a single or
common cause of action are: (1) whether the same evidence would support and sustain
both the first and the second causes of action; and (2) whether the defenses in one case
may be used to substantiate the complaint in the other. Also fundamental is the test for
determining whether the cause of action in the second case existed at the time of the
filing of the first complaint.37 chanrobleslaw

Applying the above guidelines, the Court finds that the entirety of Civil Case No. 4581 -
including the bid of petitioners to execute the money judgment awarded to them by the
trial court - is founded on a common cause of action. Records show that the sole
evidence submitted by petitioners during the execution proceedings was the Deed of
Sale, which the trial court had nullified in the main proceedings. Concomitantly, the very
same defense raised by petitioners in the main proceedings, i.e., that they had bought
the property from Spouses Bell for P1 million - was utilized to substantiate the claim
that the current value of respondents' family home was actually PI million. In fact, the
trial court's order for respondents' family home to be levied on execution was solely
based on the price stated in the nullified Deed of Sale.

Res judicata applies, considering that the parties are litigating over the same property.
Moreover, the same contentions and evidence advanced by the petitioners to
substantiate their claim over respondents' family home have already been used to
support their arguments in the main proceedings.

Any lingering doubt on the application of res judicata to this case should be put to rest
by the trial court's discussion of the nature and alienability of the property in dispute, to
wit:
chanRoblesvirtualLawlibrary

The second issue is about the allegation of the plaintiffs that the family home which has
been constituted on the house and lot in question is exempt from alienation and that its
value does not exceed P300,000. Paterno Bell, Sr. testified that the two-storey house
was built in 1947 and was made of wood and hollow blocks. He inherited it in 1976 from
his parents and has been living there with his family. In 1976, when an extra-judicial
settlement was made of the estate of his parents, the fair market value of the house
was P70,000.

City Assessor Rodezinda Pargas testified and presented Tax Declaration and others,
(Exhibit "J", Tax Declaration No. 005-047) beginning 1985 showing that the subject lot
with an area of 329 sq. m. had a fair market value of P76,000.00 and the residential
house located thereon of P50,000.00, for a total value of P126,000.00. She testified that
during the prior years the assessed values were lower. This shows that the limit of the
value of P300,000.00 under Article 157, Title 5 of the Family Code has not been
exceeded. The testimonies of the plaintiffs who are children of Sps. Paterno Bell, Sr. and
Rogelia Calingasan Bell show that they had lived in that house together with their said
parents. The Court therefore concludes that the said house is a family home under
Chapter 2, Title 5 of the Family Code. Its alienation by the said Spouses without the
written consent of the majority of the children/plaintiffs is null and void for being
contrary to law and public policy as enunciated in Art. 158 of the Family
Code.38 [Underscoring supplied]
The foregoing points plainly show that the issue of whether the property in dispute
exceeded the statutory limit of P300,000 has already been determined with finality by
the trial court. Its finding necessarily meant that the property is exempt from execution.
Assuming for the sake of argument that causes of action in the main proceedings and in
the execution proceedings are different, the parties are still barred from litigating the
issue of whether respondents' family home may be sold on execution sale under the
principle of conclusiveness of judgment.

Respondents' family home cannot be sold on execution under Article 160 of

the Family Code.

Unquestionably, the family home is exempt from execution as expressly provided for in
Article 153 of the Family Code.39 chanrobleslaw

It has been said that the family home is a real right that is gratuitous, inalienable and
free from attachment.40 The great controlling purpose and policy of the Constitution is
the protection or the preservation of the homestead - the dwelling place. A houseless,
homeless population is a burden upon the energy, industry, and morals of the
community to which it belongs. No greater calamity, not tainted with crime, can befall a
family than to be expelled from the roof under which it has been gathered and
sheltered.41 The family home cannot be seized by creditors except in special cases. 42 chanrobleslaw

The nature and character of the property that debtors may claim to be exempt,
however, are determined by the exemption statute. The exemption is limited to the
particular kind of property or the specific articles prescribed by the statute; the
exemption cannot exceed the statutory limit. 43 chanrobleslaw

Articles 155 and 160 of the Family Code specify the exceptions mentioned in Article
153, to wit:
chanRoblesvirtualLawlibrary

ARTICLE 155. The family home shall be exempt from execution, forced sale or
attachment except: ChanRoblesVirtualawlibrary

(1) For nonpayment of taxes;

(2) For debts incurred prior to the constitution of the family home;

(3) For debts secured by mortgages on the premises before or after such constitution;
and

(4) For debts due to laborers, mechanics, architects, builders, materialmen and others
who have rendered service or furnished material for the construction of the building.

ARTICLE 160. When a creditor whose claims is not among those mentioned in Article
155 obtains a judgment in his favor, and he has reasonable grounds to believe that the
family home is actually worth more than the maximum amount fixed in Article 157, he
may apply to the court which rendered the judgment for an order directing the sale of
the property under execution. The court shall so order if it finds that the actual value of
the family home exceeds the maximum amount allowed by law as of the time of its
constitution. If the increased actual value exceeds the maximum allowed in Article 157
and results from subsequent voluntary improvements introduced by the person or
persons constituting the family home, by the owner or owners of the property, or by any
of the beneficiaries, the same rule and procedure shall apply.

At the execution sale, no bid below the value allowed for a family home shall be
considered. The proceeds shall be applied first to the amount mentioned in Article 157,
and then to the liabilities under the judgment and the costs. The excess, if any, shall be
delivered to the judgment debtor. chanroblesvirtuallawlibrary

Related to the foregoing is Article 157 of the Family Code, which provides: chanRoblesvirtualLawlibrary

ARTICLE 157. The actual value of the family home shall not exceed, at the time of its
constitution, the amount of three hundred thousand pesos in urban areas, and two
hundred thousand pesos in rural areas, or such amounts as may hereafter be fixed by
law.

In any event, if the value of the currency changes after the adoption of this Code, the
value most favorable for the constitution of a family home shall be the basis of
evaluation.

For purposes of this Article, urban areas are deemed to include chartered cities and
municipalities whose annual income at least equals that legally required for chartered
cities. All others are deemed to be rural areas. [Underscoring supplied]
The minutes of the deliberation by the drafters of Family Code on Article 160 are
enlightening, to wit:
chanRoblesvirtualLawlibrary

Justice Puno inquired if the above Article [160] is still necessary. In reply, Judge Diy
opined that the above Article is intended to cover a situation where the family home is
already worth P500,000 or P1M. Justice Reyes stated that it is possible that a family
home, originally valued at P300,000. later appreciated to almost P1M because of
improvements made, like roads and plazas. Justice Caguioa, however, made a
distinction between voluntary and involuntary improvements in the sense that if the
value of the family home exceeded the maximum amount because of voluntary
improvements by the one establishing the family home, the Article will apply; but if it is
through an involuntary improvement, like the conversion into a residential area or the
establishment of roads and other facilities, the one establishing the family home should
not be punished by making his home liable to creditors. He suggested that the matter
be clarified in the provision.

xxxx

Prof. Bautista objected to the phrase "is worth" since if they will specify that the family
home is worth more than the maximum amount at the time it was constituted, they will
avoid the suit because the creditor will be given proper warning. Justice Puno opined
that this is a question of fact. Justice Caguioa added that, under the second sentence,
there will be a preliminary determination as to whether the family home exceeds the
maximum amount allowed by law.
xxxx

Justice Caguia accordingly modified the last sentence as follows: ChanRoblesVirtualawlibrary

If the excess in actual value over that allowed in Article 157 is due to subsequent
voluntary improvements by the person or persons constituting the family home or by
the owner or owners of the property, the same rules and procedure shall apply. chanroblesvirtuallawlibrary

Prof. Bautista objected to the above provision, because it will in effect penalize the
owner for improving the family home. On the other hand, Justice Puno opined that the
provision covers only the excess in actual value over that allowed by law. Judge Diy
added that the owner may improve the family home up to P300,000. Justice Caguioa
stated that without the above provision, one can borrow money, put it all on
improvement of the family home even beyond the maximum value of a family home
and, thereby, exempt it from levy on the part of the creditor. He added that anyway, if
one voluntarily improves his family home out of his money, nobody can complain
because there are no creditors.

Justice Puno posed the question: What is "due to the subsequent improvement?" Is it
the "excess" or is it the "increase", or is it the "increase", which constitutes the
"excess"? In reply. Justice Reyes opined that it is the "increase" which constituted the
"excess". Justice Puno, Justice Reyes and Justice Caguioa modified the last sentence as
follows:chanRoblesvirtualLawlibrary

If the increase in actual value exceeds that maximum allowed in Article 157 and results
from subsequent voluntary improvements introduced by the person or persons
constituting the family home or by the owner or owners of the property, the same rule
and procedure shall apply. chanroblesvirtuallawlibrary

Prof. Bautista commented that the phrase "increase in actual value" does not include
the original value. Justice Puno suggested that they just say "increased actual value",
which the Committee approved.44 [Underscoring supplied]
To summarize, the exemption of the family home from execution, forced sale or
attachment is limited to P300,000 in urban areas and P200,000 in rural areas, unless
those maximum values are adjusted by law. If it is shown, though, that those amounts
do not match the present value of the peso because of currency fluctuations, the
amount of exemption shall be based on the value that is most favorable to the
constitution of a family home. Any amount in excess of those limits can be applied to
the payment of any of the obligations specified in Articles 155 and 160.

Any subsequent improvement or enlargement of the family home by the persons

constituting it, its owners, or any of its beneficiaries will still be exempt from execution,
forced sale or attachment provided the following conditions obtain: (a) the actual value
of the property at the time of its constitution has been determined to fall below the
statutory limit; and (b) the improvement or enlargement does not result in an increase
in its value exceeding the statutory limit.45 Otherwise, the family home can be the
subject of a forced sale, and any amount above the statutory limit is applicable to the
obligations under Articles 155 and 160.

Certainly, the humane considerations for which the law surrounds the family home with
immunities from levy do not include the intent to enable debtors to thwart the just
claims of their creditors.46 chanrobleslaw

Petitioners maintain that this case falls under the exceptions to the exemption of the
family home from execution or forced sale. They claim that the actual value of
respondents' family home exceeds the P300,000 limit in urban areas. This fact is
supposedly shown by the Deed of Sale whereby private respondents agreed to sell the
property for PI million way back in 1995. Therefore, the RTC only properly ordered the
execution sale of the property under Article 160 to satisfy the money judgment awarded
to them in Civil Case No. 4581.47 chanrobleslaw

As earlier discussed, it has been judicially determined with finality that the property in
dispute is a family home, and that its value at the time of its constitution was within the
statutory limit. Moreover, respondents have timely claimed the exemption of the
property from execution.48 On the other hand, there is no question that the money
judgment awarded to petitioners falls under the ambit of Article 160.

Notwithstanding petitioners' right to enforce the trial court's money judgment, however,
they cannot obtain its satisfaction at the expense of respondents' rights over their
family home. It is axiomatic that those asserting the protection of an exception from an
exemption must bring themselves clearly within the terms of the exception and satisfy
any statutory requirement for its enforcement.49 chanrobleslaw

To warrant the execution sale of respondents' family home under Article 160,
petitioners needed to establish these facts: (1) there was an increase in its actual value;
(2) the increase resulted from voluntary improvements on the property introduced by
the persons constituting the family home, its owners or any of its beneficiaries; and (3)
the increased actual value exceeded the maximum allowed under Article 157.

During the execution proceedings, none of those facts was alleged - much less proven -
by petitioners. The sole evidence presented was the Deed of Sale, but the trial court
had already determined with finality that the contract was null, and that the actual
transaction was an equitable mortgage. Evidently, when petitioners and Spouses Bell
executed the Deed of Sale in 1990, the price stated therein was not the actual value of
the property in dispute.

The Court thus agrees with the CA's conclusion that the trial court committed grave
abuse of discretion in ordering the sale on execution of the property in dispute under
Article 160. The trial court had already determined with finality that the property was a
family home, and there was no proof that its value had increased beyond the statutory
limit due to voluntary improvements by respondents. Yet, it ordered the execution sale
of the property. There is grave abuse of discretion when one acts in a capricious,
whimsical, arbitrary or despotic manner in the exercise of one's judgment, as in this
case in which the assailed order is bereft of any factual or legal justification. 50
chanrobleslaw

WHEREFORE, the Petition for Review on Certiorari is hereby DENIED for lack of merit.
Accordingly, the Decision of the Court of Appeals in CA-G.R. SP No. 87531, enjoining the
trial court from proceeding with the sale of the family home of respondents,
is AFFIRMED.

SO ORDERED. cralawlawlibrary

Leonardo-De Castro, Bersamin, Perez, and Perlas-Bernabe, JJ., concur.

DE MESA V. ACERO
Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 185064 January 16, 2012

SPOUSES ARACELI OLIVA-DE MESA and ERNESTO S. DE MESA, Petitioner,

vs.
SPOUSES CLAUDIO D. ACERO, JR. and MA. RUFINA D. ACERO, SHERIFF FELIXBERTO L.
SAMONTE and REGISTRAR ALFREDO SANTOS, Respondents.

DECISION

REYES, J.:

Nature of the Petition

This is a petition for review on certiorari under Rule 45 of the Rules of Court filed by the Spouses
Araceli Oliva-De Mesa (Araceli) and Ernesto S. De Mesa (Ernesto), assailing the Court of Appeals’
(CA) Decision dated June 6, 2008 and Resolution dated October 23, 2008 in CA-G.R. CV No. 79391
1 2

entitled "Spouses Araceli Oliva-De Mesa and Ernesto De Mesa v. Spouses Claudio Acero, Jr., et al."

The Antecedent Facts

This involves a parcel of land situated at No. 3 Forbes Street, Mount Carmel Homes Subdivision,
Iba, Meycauayan, Bulacan, which was formerly covered by Transfer Certificate of Title (TCT) No. T-
76.725 (M) issued by the Register of Deeds of Meycauayan, Bulacan and registered under Araceli’s
name. The petitioners jointly purchased the subject property on April 17, 1984 while they were still
merely cohabiting before their marriage. A house was later constructed on the subject property,
which the petitioners thereafter occupied as their family home after they got married sometime in
January 1987.

Sometime in September 1988, Araceli obtained a loan from Claudio D. Acero, Jr. (Claudio) in the
amount of ₱100,000.00, which was secured by a mortgage over the subject property. As payment,
Araceli issued a check drawn against China Banking Corporation payable to Claudio.

When the check was presented for payment, it was dishonored as the account from which it was
drawn had already been closed. The petitioners failed to heed Claudio’s subsequent demand for
payment.

Thus, on April 26, 1990, Claudio filed with the Prosecutor's Office of Malolos, Bulacan a complaint
for violation of Batas Pambansa Blg. 22 (B.P. 22) against the petitioners. After preliminary
investigation, an information for violation of B.P. 22 was filed against the petitioners with the
Regional Trial Court (RTC) of Malolos, Bulacan.

On October 21, 1992, the RTC rendered a Decision acquitting the petitioners but ordering them to
3

pay Claudio the amount of ₱100,000.00 with legal interest from date of demand until fully paid.

On March 15, 1993, a writ of execution was issued and Sheriff Felixberto L. Samonte (Sheriff
Samonte) levied upon the subject property. On March 9, 1994, the subject property was sold on
public auction; Claudio was the highest bidder and the corresponding certificate of sale was issued
to him.

Sometime in February 1995, Claudio leased the subject property to the petitioners and a certain
Juanito Oliva (Juanito) for a monthly rent of ₱5,500.00. However, the petitioners and Juanito
defaulted in the payment of the rent and as of October 3, 1998, their total accountabilities to Claudio
amounted to ₱170,500.00.

Meanwhile, on March 24, 1995, a Final Deed of Sale over the subject property was issued to
4
Claudio and on April 4, 1995, the Register of Deeds of Meycauayan, Bulacan cancelled TCT No. T-
76.725 (M) and issued TCT No. T-221755 (M) in his favor.
5

Unable to collect the aforementioned rentals due, Claudio and his wife Ma. Rufina Acero (Rufina)
(collectively referred to as Spouses Acero) filed a complaint for ejectment with the Municipal Trial
Court (MTC) of Meycauayan, Bulacan against the petitioners and Juanito. In their defense, the
petitioners claimed that Spouses Acero have no right over the subject property. The petitioners deny
that they are mere lessors; on the contrary, they are the lawful owners of the subject property and,
thus cannot be evicted therefrom.

On July 22, 1999, the MTC rendered a Decision, giving due course to Spouses Acero’s complaint
6

and ordering the petitioners and Juanito to vacate the subject property. Finding merit in Spouses
Acero’s claims, the MTC dismissed the petitioners' claim of ownership over the subject property.
According to the MTC, title to the subject property belongs to Claudio as shown by TCT No. T-
221755 (M).

The MTC also stated that from the time a Torrens title over the subject property was issued in
Claudio’s name up to the time the complaint for ejectment was filed, the petitioners never assailed
the validity of the levy made by Sheriff Samonte, the regularity of the public sale that was conducted
thereafter and the legitimacy of Claudio’s Torrens title that was resultantly issued.

The petitioners appealed the MTC’s July 22, 1999 Decision to the RTC. This appeal was, however,
dismissed in a Decision dated November 22, 1999 due to the petitioners’ failure to submit their
Memorandum. The petitioners sought reconsideration of the said decision but the same was denied
in an Order dated January 31, 2000.

Consequently, the petitioners filed a petition for review with the CA assailing the RTC’s November
7

22, 1999 Decision and January 31, 2000 Order. In a December 21, 2006 Decision, the CA denied
8

the petitioner’s petition for review. This became final on July 25, 2007.
9

In the interregnum, on October 29, 1999, the petitioners filed against the respondents a complaint to
10

nullify TCT No. T-221755 (M) and other documents with damages with the RTC of Malolos, Bulacan.
Therein, the petitioners asserted that the subject property is a family home, which is exempt from
execution under the Family Code and, thus, could not have been validly levied upon for purposes of
satisfying the March 15, 1993 writ of execution.

On September 3, 2002, the RTC rendered a Decision, which dismissed the petitioners’ complaint.
11

Citing Article 155(3) of the Family Code, the RTC ruled that even assuming that the subject property
is a family home, the exemption from execution does not apply. A mortgage was constituted over the
subject property to secure the loan Araceli obtained from Claudio and it was levied upon as payment
therefor.

The petitioners sought reconsideration of the RTC’s September 3, 2002 Decision but this was
denied in a Resolution dated January 14, 2003.
12

On appeal, the CA affirmed the RTC’s disposition in its Decision dated June 6, 2008. The CA
13

ratiocinated that the exemption of a family home from execution, attachment or forced sale under
Article 153 of the Family Code is not automatic and should accordingly be raised and proved to the
Sheriff prior to the execution, forced sale or attachment. The appellate court noted that at no time did
the petitioners raise the supposed exemption of the subject property from execution on account of
the same being a family home.

The petitioners then sought reconsideration of the said June 6, 2008 Decision but the same was
denied by the CA in its Resolution dated October 23, 2008.
14

Aggrieved, the petitioners filed the instant petition for review, praying for the cancellation of TCT No.
T-221755 (M). They insist that the execution sale that was conducted is a nullity considering that the
subject property is a family home. The petitioners assert that, contrary to the disposition of the CA, a
prior demonstration that the subject property is a family home is not required before it can be
exempted from execution.

In their Comment, Spouses Acero claimed that this petition ought to be denied on the ground of
15

forum-shopping as the issues raised had already been determined by the MTC in its July 22, 1999
Decision on the complaint for ejectment filed by them, which had already become final and
executory following the petitioner’s failure to appeal the CA’s December 21, 2006 Decision affirming
it.

Issues

The threshold issues for resolution are the following: (a) whether the petitioners are guilty of forum-
shopping; and (b) whether the lower courts erred in refusing to cancel Claudio’s Torrens title TCT
No. T-221755 (M) over the subject property.

The Court’s Ruling

First Issue: Forum-Shopping

On the first issue, we find that the petitioners are not guilty of forum-shopping.

There is forum-shopping when as a result of an adverse decision in one forum, or in anticipation

thereof, a party seeks a favorable opinion in another forum through means other than an appeal
or certiorari. Forum-shopping exists when two or more actions involve the same transactions,
essential facts, and circumstances; and raise identical causes of action, subject matter, and issues. 16

Forum-shopping exists where the elements of litis pendentia are present, and where a final judgment
in one case will amount to res judicata in the other. The elements of forum-shopping are: (a) identity
of parties, or at least such parties as would represent the same interest in both actions; (b) identity of
rights asserted and relief prayed for, the relief being founded on the same facts; and (c) identity of
the two preceding particulars such that any judgment rendered in the other action will, regardless of
which party is successful, amount to res judicata in the action under consideration. 17

There is no identity of issues and reliefs prayed for in the ejectment case and in the action to cancel
TCT No. T-221755 (M). Verily, the primordial issue in the ejectment case is who among the
contending parties has a better right of possession over the subject property while ownership is the
core issue in an action to cancel a Torrens title.

It is true that the petitioners raised the issue of ownership over the subject property in the ejectment
case. However, the resolution thereof is only provisional as the same is solely for the purpose of
determining who among the parties therein has a better right of possession over the subject
property.
Accordingly, a judgment rendered in an ejectment case is not a bar to action between the same
parties respecting title to the land or building. Neither shall it be conclusive as to the facts therein.
This issue is far from being novel and there is no reason to depart from this Court’s previous
pronouncements. In Malabanan v. Rural Bank of Cabuyao, Inc., this Court had previously clarified
18

that a decision in an ejectment case is not res judicata in an annulment of title case and vice-versa
given the provisional and inconclusive nature of the determination of the issue of ownership in the
former.

Forum-shopping exists where the elements of litis pendentia are present, namely: (a) identity of
parties or at least such as representing the same interests in both actions; (b) identity of rights
asserted and reliefs prayed for, the relief being founded on the same facts; and (c) the identity in the
two cases should be such that the judgment that may be rendered in one would, regardless of which
party is successful, amounts to res judicata in the other.

Petitioner and respondent are the same parties in the annulment and ejectment cases. The issue of
ownership was likewise being contended, with same set of evidence being presented in both cases.
However, it cannot be inferred that a judgment in the ejectment case would amount to res judicata in
the annulment case, and vice-versa.

This issue is hardly a novel one. It has been laid to rest by heaps of cases iterating the principle that
a judgment rendered in an ejectment case shall not bar an action between the same parties
respecting title to the land or building nor shall it be conclusive as to the facts therein found in a case
between the same parties upon a different cause of action involving possession.

It bears emphasizing that in ejectment suits, the only issue for resolution is the physical or material
possession of the property involved, independent of any claim of ownership by any of the party
litigants. However, the issue of ownership may be provisionally ruled upon for the sole purpose of
determining who is entitled to possession de facto. Therefore, the provisional determination of
ownership in the ejectment case cannot be clothed with finality.

Corollarily, the incidental issue of whether a pending action for annulment would abate an ejectment
suit must be resolved in the negative.

A pending action involving ownership of the same property does not bar the filing or consideration of
an ejectment suit, nor suspend the proceedings. This is so because an ejectment case is simply
designed to summarily restore physical possession of a piece of land or building to one who has
been illegally or forcibly deprived thereof, without prejudice to the settlement of the parties' opposing
claims of juridical possession in appropriate proceedings. (citations omitted)
19

Second Issue: Nullification of TCT No. T-221755 (M)

Anent the second issue, this Court finds that the CA did not err in dismissing the petitioners’
complaint for nullification of TCT No. T-221755 (M).

The subject property is a family home.

The petitioners maintain that the subject property is a family home and, accordingly, the sale thereof
on execution was a nullity. In Ramos v. Pangilinan, this Court laid down the rules relative to
20

exemption of family homes from execution:

For the family home to be exempt from execution, distinction must be made as to what law applies
based on when it was constituted and what requirements must be complied with by the judgment
debtor or his successors claiming such privilege. Hence, two sets of rules are applicable.

If the family home was constructed before the effectivity of the Family Code or before August 3,
1988, then it must have been constituted either judicially or extra-judicially as provided under
Articles 225, 229-231 and 233 of the Civil Code. Judicial constitution of the family home requires
the filing of a verified petition before the courts and the registration of the court’s order with the
Registry of Deeds of the area where the property is located. Meanwhile, extrajudicial constitution is
governed by Articles 240 to 242 of the Civil Code and involves the execution of a public instrument
which must also be registered with the Registry of Property. Failure to comply with either one of
these two modes of constitution will bar a judgment debtor from availing of the privilege.

On the other hand, for family homes constructed after the effectivity of the Family Code on August 3,
1988, there is no need to constitute extrajudicially or judicially, and the exemption is effective
from the time it was constituted and lasts as long as any of its beneficiaries under Art. 154 actually
resides therein. Moreover, the family home should belong to the absolute community or conjugal
partnership, or if exclusively by one spouse, its constitution must have been with consent of the
other, and its value must not exceed certain amounts depending upon the area where it is located.
Further, the debts incurred for which the exemption does not apply as provided under Art. 155 for
which the family home is made answerable must have been incurred after August 3, 1988. (citations
21

omitted)

In the earlier case of Kelley, Jr. v. Planters Products, Inc., we stressed that:
22

Under the Family Code, there is no need to constitute the family home judicially or extrajudicially. All
family homes constructed after the effectivity of the Family Code (August 3, 1988) are constituted as
such by operation of law. All existing family residences as of August 3, 1988 are considered
family homes and are prospectively entitled to the benefits accorded to a family home under
the Family Code. (emphasis supplied and citation omitted)
23

The foregoing rules on constitution of family homes, for purposes of exemption from execution, could
be summarized as follows:

First, family residences constructed before the effectivity of the Family Code or before
August 3, 1988 must be constituted as a family home either judicially or extrajudicially in
accordance with the provisions of the Civil Code in order to be exempt from execution;

Second, family residences constructed after the effectivity of the Family Code on August 3,
1988 are automatically deemed to be family homes and thus exempt from execution from the
time it was constituted and lasts as long as any of its beneficiaries actually resides therein;

Third, family residences which were not judicially or extrajudicially constituted as a family
home prior to the effectivity of the Family Code, but were existing thereafter, are considered
as family homes by operation of law and are prospectively entitled to the benefits accorded
to a family home under the Family Code.

Here, the subject property became a family residence sometime in January 1987. There was no
showing, however, that the same was judicially or extrajudicially constituted as a family home in
accordance with the provisions of the Civil Code. Still, when the Family Code took effect on August
3, 1988, the subject property became a family home by operation of law and was thus prospectively
exempt from execution. The petitioners were thus correct in asserting that the subject property was a
family home.

The family home’s exemption from execution must be set up and proved to the Sheriff before
the sale of the property at public auction.

Despite the fact that the subject property is a family home and, thus, should have been exempt from
execution, we nevertheless rule that the CA did not err in dismissing the petitioners’ complaint for
nullification of TCT No. T-221755 (M). We agree with the CA that the petitioners should have
asserted the subject property being a family home and its being exempted from execution at the time
it was levied or within a reasonable time thereafter. As the CA aptly pointed out:

In the light of the facts above summarized, it is evident that appellants did not assert their claim of
exemption within a reasonable time. Certainly, reasonable time, for purposes of the law on
exemption, does not mean a time after the expiration of the one-year period provided for in Section
30 of Rule 39 of the Rules of Court for judgment debtors to redeem the property sold on execution,
otherwise it would render nugatory final bills of sale on execution and defeat the very purpose of
execution – to put an end to litigation. x x x. 24

The foregoing disposition is in accord with the Court’s November 25, 2005 Decision in Honrado v.
Court of Appeals, where it was categorically stated that at no other time can the status of a
25

residential house as a family home can be set up and proved and its exemption from execution be
claimed but before the sale thereof at public auction:

While it is true that the family home is constituted on a house and lot from the time it is occupied as a
family residence and is exempt from execution or forced sale under Article 153 of the Family Code,
such claim for exemption should be set up and proved to the Sheriff before the sale of the property
at public auction. Failure to do so would estop the party from later claiming the exemption. As this
Court ruled in Gomez v. Gealone:

Although the Rules of Court does not prescribe the period within which to claim the exemption, the
rule is, nevertheless, well-settled that the right of exemption is a personal privilege granted to the
judgment debtor and as such, it must be claimed not by the sheriff, but by the debtor himself at the
time of the levy or within a reasonable period thereafter;

"In the absence of express provision it has variously held that claim (for exemption) must be made at
the time of the levy if the debtor is present, that it must be made within a reasonable time, or
promptly, or before the creditor has taken any step involving further costs, or before advertisement of
sale, or at any time before sale, or within a reasonable time before the sale, or before the sale has
commenced, but as to the last there is contrary authority."

In the light of the facts above summarized, it is self-evident that appellants did not assert their claim
of exemption within a reasonable time. Certainly, reasonable time, for purposes of the law on
exemption, does not mean a time after the expiration of the one-year period provided for in Section
30 of Rule 39 of the Rules of Court for judgment debtors to redeem the property sold on execution,
otherwise it would render nugatory final bills of sale on execution and defeat the very purpose of
execution—to put an end to litigation. We said before, and We repeat it now, that litigation must end
1awphil

and terminate sometime and somewhere, and it is essential to an effective administration of justice
that, once a judgment has become final, the winning party be not, through a mere subterfuge,
deprived of the fruits of the verdict. We now rule that claims for exemption from execution of
properties under Section 12 of Rule 39 of the Rules of Court must be presented before its sale on
execution by the sheriff. (citations omitted)
26

Reiterating the foregoing in Spouses Versola v. Court of Appeals, this Court stated that:
27

Under the cited provision, a family home is deemed constituted on a house and lot from the time it is
occupied as a family residence; there is no need to constitute the same judicially or extrajudicially.

The settled rule is that the right to exemption or forced sale under Article 153 of the Family
Code is a personal privilege granted to the judgment debtor and as such, it must be claimed
not by the sheriff, but by the debtor himself before the sale of the property at public
auction. It is not sufficient that the person claiming exemption merely alleges that such property is a
family home. This claim for exemption must be set up and proved to the Sheriff. x x
x. (emphasis supplied and citations omitted)
28

Having failed to set up and prove to the sheriff the supposed exemption of the subject property
before the sale thereof at public auction, the petitioners now are barred from raising the same.
Failure to do so estop them from later claiming the said exemption.

Indeed, the family home is a sacred symbol of family love and is the repository of cherished
memories that last during one’s lifetime. It is likewise without dispute that the family home, from the
29

time of its constitution and so long as any of its beneficiaries actually resides therein, is generally
exempt from execution, forced sale or attachment. 30

The family home is a real right, which is gratuitous, inalienable and free from attachment. It cannot
be seized by creditors except in certain special cases. However, this right can be waived or be
31

barred by laches by the failure to set up and prove the status of the property as a family home at the
time of the levy or a reasonable time thereafter.

In this case, it is undisputed that the petitioners allowed a considerable time to lapse before claiming
that the subject property is a family home and its exemption from execution and forced sale under
the Family Code. The petitioners allowed the subject property to be levied upon and the public sale
to proceed. One (1) year lapsed from the time the subject property was sold until a Final Deed of
Sale was issued to Claudio and, later, Araceli’s Torrens title was cancelled and a new one issued
under Claudio’s name, still, the petitioner remained silent. In fact, it was only after the respondents
filed a complaint for unlawful detainer, or approximately four (4) years from the time of the auction
sale, that the petitioners claimed that the subject property is a family home, thus, exempt from
execution.

For all intents and purposes, the petitioners’ negligence or omission to assert their right within a
reasonable time gives rise to the presumption that they have abandoned, waived or declined to
assert it. Since the exemption under Article 153 of the Family Code is a personal right, it is
incumbent upon the petitioners to invoke and prove the same within the prescribed period and it is
not the sheriff’s duty to presume or raise the status of the subject property as a family home.

The petitioners’ negligence or omission renders their present assertion doubtful; it appears that it is a
mere afterthought and artifice that cannot be countenanced without doing the respondents injustice
and depriving the fruits of the judgment award in their favor. Simple justice and fairness and
equitable considerations demand that Claudio’s title to the property be respected. Equity dictates
that the petitioners are made to suffer the consequences of their unexplained negligence.

WHEREFORE, in consideration of the foregoing disquisitions, the petition is DENIED. The assailed
Decision dated June 6, 2008 of the Court of Appeals in CA-G.R. CV No. 79391, which affirmed the
Decision of the Regional Trial Court of Malolos, Bulacan, Branch 22, in Civil Case No. 1058-M-99
and dismissed the complaint for declaration of nullity of TCT No. 221755 (M) and other documents,
and the October 23, 2008 Resolution denying reconsideration, are AFFIRMED.

SO ORDERED.

BIENVENIDO L. REYES
Associate Justice

WE CONCUR:

ANTONIO T. CARPIO
Associate Justice

JOSE PORTUGAL PEREZ MARIA LOURDES P. A. SERENO

Associate Justice Associate Justice
ESTELA M. PERLAS-BERNABE*
Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case
was assigned to the writer of the opinion of the Court’s Division.

ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division

SALAZAR V. FELIAS
SECOND DIVISION

G.R. No. 213972, February 05, 2018

FELICITAS L. SALAZAR, Petitioner, v. REMEDIOS FELIAS, ON HER OWN BEHALF

AND REPRESENTATION OF THE OTHER HEIRS OF CATALINO
NIVERA, Respondents.

DECISION

REYES, JR., J.:

The movant's claim that his/her property is exempt from execution for being the family
home is not a magic wand that will freeze the court's hand and forestall the execution
of a final and executory ruling. It is imperative that the claim for exemption must be set
up and proven.

This treats of the petition for review on certiorari 1 under Rule 45 of the Revised Rules of
Court seeking the reversal of the Decision2 dated December 62013, and
Resolution3 dated August 7, 2014, rendered by the Court of Appeals (CA) in CA-G.R. CV
No. 97309, which affirmed the execution of the final and executory judgment issued by
the Regional Trial Court, Branch 55, Alaminos, Pangasinan (RTC Branch 55).

The Antecedent Facts

On February 28, 1990, private respondent Remedios Felias, representing the heirs of
Catalino Nivera (Heirs of Nivera) filed a Complaint for Recovery of Ownership,
Possession and Damages against the Spouses Romualdo Lastimosa (Romualdo) and
Felisa Lastimosa (Fe1isa). The former sought to recover from the latter four parcels of
land located in Baruan, Agno, Pangasinan (subject property).

On March 3, 1997, during the trial of the case, Romualdo died.

Consequently, on July 6, 1998, a Motion for Substitution 4 was filed by the decedent's
wife, Felisa, and their children Flordeliza Sagun, Reynaldo Lastimosa, Recto Lastimosa
(Recto), Rizalina Ramirez (Rizalina), Lily Lastimosa, and Avelino Lastimosa (Heirs
ofLastimosa).

On March 16, 2004, the RTC Branch 55 rendered a Decision, 5 declaring the Heirs of
Nivera as the absolute owners of the parcels of land in question, and thereby ordering
the Heirs of Lastimosa to vacate the lands and to surrender possession thereof. The
dispositive portion of the decision of the RTC Branch 55, reads:
WHEREFORE, this Honorable Court renders judgment:

a. Declaring the [Heirs of Nivera] absolute owners of the parcels of land in question as
described in the Amended Complaint, and ordering the [Heirs of Lastimosa] to surrender
possession thereof and vacate the same;

b. Ordering the [Heirs of Lastimosa], jointly and severally, to pay the [Heirs of Nivera]
actual damages in the amount of Php 270,000.00 for 1975 to 1995, and Php 10,000.00
annually from 1996 and through all the subsequent years until actual possession shall
have been restored to the [Heirs of Nivera]; attorney's fees and litigation expenses in
the amount of Php 21,000.00; and costs.

SO ORDERED.6
The Heirs of Lastimosa did not file an appeal against the trial court's ruling.

Meanwhile, Felicitas Salazar (Felicitas), daughter of Romualdo, along with Recto and
Rizalina filed a Petition for Annulment of Judgment dated June 22, 2006 with the CA.
Felicitas sought the nullification of the RTC Branch 55's Decision dated March 16, 2004,
and the corresponding Writs of Execution and Demolition issued pursuant thereto. 7 In
her Petition for Annulment of Judgment, Felicitas claimed that she was deprived of due
process when she was not impleaded in the case for Recovery of Ownership, before the
RTC Branch 55.8

On June 5, 2008, the Former Tenth Division of the CA rendered a Decision, 9 in CA-G.R.
SP No. 95592, dismissing the Petition for Annulment of Judgment. The CA refused to
give credence to the contention that the Heirs of Nivera are at fault for failing to
implead Felicitas as a party defendant in the action for recovery of ownership. Rather,
the failure to include Felicitas in the proceedings was due to the fault of the Heirs of
Lastimosa, who neglected to include her (Felicitas) in their Motion to Substitute. The CA
further ratiocinated that since the RTC acquired jurisdiction over the person of the
original defendants Romualdo and Felisa, the outcome of the case is binding on all their
heirs or any such persons claiming rights under them. 10

On June 3, 2009, this Court affirmed the CA decision in the Petition for Annulment of
Judgment.11 The Court's ruling became final, as per Entry of Judgment, on October 5,
2009.

Meanwhile, the Heirs of Lastimosa filed with the RTC Branch 55 an Urgent Motion to
Order the Sheriff to Desist from Making Demolition dated April 24, 2010. The Motion to
Desist was premised on the fact that the Sheriff cannot execute the lower court's
decision considering that Felicitas had an aliquot share over the property, which had not
yet been partitioned.12

At about the same time, the Heirs of Nivera filed a Motion for Execution and Demolition
dated May 28, 2010. The Motion for Execution was anchored on the fact that the
Decision dated March 16, 2004, in the case for recovery of ownership, possession and
damages had long attained finality.13

On July 9, 2010, the RTC Branch 55 issued an Order granting the Motion for Execution
and Demolition, and denying the Motion to Desist. 14 The dispositive portion of the order
reads:
After going over the allegations in both motions, the Court resolves to deny the motion,
to order the Sheriff to desist from making demolition filed by the defendants through
counsel, it appearing that the grounds raised in the said motion are already mooted by
the subsequent filing of the motion for execution and demolition filed by plaintiff
through counsel.

The motion for execution and demolition is hereby granted.

Accordingly, let [a] Writ of Execution and Demolition issue to satisfy judgement
rendered in this case.

SO ORDERED.15
Dissatisfied with the ruling, the Heirs of Lastimosa 16 filed an appeal before the CA,
questioning the Writ of Execution and Demolition issued by the lower court.

On December 6, 2013, the Fifteenth Division of the CA rendered the assailed

Decision17 dismissing the appeal on the following grounds, to wit: (i) the Heirs of
Lastimosa availed of the wrong remedy by filing an appeal, instead of a petition
for certiorari under Rule 65; (ii) the matter pertaining to the non-inclusion of Felicitas is
already barred by res judicata, as it has been settled with finality in CA-G.R. SP No.
95592, and affirmed by the Supreme Court in G.R. No. 185056; and (iii) the execution of
the decision rendered by the RTC Branch 55 is proper considering that case has long
attained finality. The dispositive portion of the assailed CA decision reads:
ACCORDINGLY, the appeal is DENIED. The assailed Order dated April 6, 2011 is
AFFIRMED.18
Felicitas filed a Motion for Reconsideration against the same Decision, which was denied
by the CA in its Resolution19 dated August 7, 2014.

Undeterred, Felicitas filed the instant petition for review on certiorari20 under Rule 45 of
the Revised Rules of Court seeking the reversal of the assailed CA decision and
resolution.

The Issue

The main issue for this Court's resolution rests on whether the CA erred in ordering the
execution of the Decision dated March 16, 2004.

In seeking the reversal of the assailed decision, Felicitas claims that the Writ of
Execution and Demolition issued by the RTC Branch 55 was executed against the wrong
party.21 She points out that she was not impleaded in the case for recovery of ownership
and possession, and thus the decision cannot bind her. 22 Felicitas argues that she was
deprived of her property as an heir without due process, as she was left out of the
proceedings, "completely unable to protect her rights." 23 In addition, Felicitas contends
that the execution cannot continue as the Writ of Execution is being enforced against
property that is exempt from execution, as what is sought to be demolished is her
family home. In this regard, Article 155 of the Family Code ordains that the family home
shall be exempt from execution.24

On the other hand, the Heirs of Nivera counter that the petition for review
on certiorari is nothing but a dilatory tactic employed by Felicitas to overthrow and
delay the execution of the judgment rendered in as early as March 16, 2004. 25 The Heirs
of Nivera maintain that Felicitas' claim that she was deprived of her property as an heir
without due process of law has already been settled with finality in the Petition for
Annulment of Judgement, which was dismissed by the CA, and this Court. 26 Likewise,
anent the claim that the subject property is exempt from execution, the Heirs of Nivera
aver that Felicitas failed to present an iota of evidence to prove her claim. On the
contrary, Felicitas herself admitted in her pleadings that she does not reside in the
subject property in Alaminos, but actually lives in Mu�oz, Nueva Ecija. 27 Moreover, the
subject property belonged to the Heirs of Nivera in as early as the 1950s, thereby
negating Felicitas' claim that it is her family home. 28

Ruling of the Court

The petition is bereft of merit.

Nothing is more settled than the rule that a judgment that is final and executory is
immutable and unalterable. It may no longer be modified in any respect, except when
the judgment is void, or to correct clerical errors or to make nunc pro tunc entries. In
the same vein, the decision that has attained finality becomes the law of the case,
regardless of any claim that it is erroneous. Any amendment or alteration which
substantially affects a final and executory judgment is null and void for lack of
jurisdiction, including the entire proceedings held for that purpose. 29 Accordingly, the
court cannot refuse to issue a writ of execution upon a final and executory judgment, or
quash it, or stay its implementation.30

Concomitantly, neither may the parties object to the execution by raising new issues of
fact or law. The only exceptions thereto are when: "(i) the writ of execution varies the
judgment; (ii) there has been a change in the situation of the parties making execution
inequitable or unjust; (iii) execution is sought to be enforced against property exempt
from execution; (iv) it appears that the controversy has been submitted to the judgment
of the court; (v) the terms of the judgment are not clear enough and there remains
room for interpretation thereof; or (vi) it appears that the writ of execution has been
improvidently issued, or that it is defective in substance, or issued against the wrong
party, or that the judgment debt has been paid or otherwise satisfied, or the writ was
issued without authority."31

In the case at bar, there is no dispute that in as early as March 16, 2004, the RTC
Branch 55 of Alaminos, Pangasinan rendered a Decision in the case for Recovery of
Ownership, Possession and Damages, ordering the Heirs of Lastimosa to vacate the
subject properties and surrender them to the Heirs of Nivera. There is no dispute that
this ruling of the RTC had become final and executory. Pursuant thereto, the lower court
issued a Writ of Execution and Demolition.

This notwithstanding, Felicitas seeks to prevent the execution of the same order,
arguing that the writ was issued against the wrong party; and that the property sought
to be executed is exempt from execution.

The Court is not persuaded.

It must be noted at the outset that the matter of whether Felicitas was deprived of due
process of law for not having been impleaded in the case for recovery of ownership and
possession has long been settled with finality.

In the decision of the CA in the case for Petition for Annulment of Judgment (CA-G.R. SP
No. 95592),32 the Former Tenth Division of the CA squarely and judiciously passed upon
the issue of whether the. judgment of the lower court in the action for recovery of
ownership and possession was void for failure to implead Felicitas. The CA held that:
Finally, the intimation of the petitioners that private respondent is at fault for failing to
implead [Felicitas] as party defendant in this case is patently without basis. It must be
recalled that the lower court acquired jurisdiction over the person of the original
defendants Romualdo and Feliza Lastimosa. Hence, the outcome of this case is binding
on all the heirs or persons claiming rights under the said defendants. When [Romualdo]
died on March 3, 1997, the defendants filed an Urgent Motion to Substitute Other Heirs
of the said defendant listing the names of the heirs to be substituted. It is therefore
crystal clear that if [Felicitas] was not impleaded in this case as party defendant being
the daughter of [Romualdo], that omission could not be attributed to the private
respondent but the defendants themselves.33 (Underscoring in the original)
This ruling of the CA was affirmed by this Court in the Resolution dated June 3, 2009,
and attained finality as per Entry of Judgment. Markedly, it is crystal clear that the
issues pertaining to Felicitas' non-inclusion in the proceedings, and the consequent
validity of the lower court's judgment have long attained finality. It bears reiterating
that a judgment that is final and executory cannot be altered, even by the highest court
of the land. This final judgment has become the law of the case, which is now
immutable.

Additionally, as an heir of the original defendants in the action for recovery of

ownership, Felicitas is bound by the decision rendered against her predecessors-in-
interest. Thus, there is nothing that exempts her from the enforcement of the Writ
ofExecution.
In another attempt to thwart the execution of the
RTC's final and executory judgment, Felicitas
claims that the execution cannot proceed, as the
subject property is her family home and is
therefore exempt from execution.
Indeed, the family home is a real right which is gratuitous, inalienable and free from
attachment, constituted over the dwelling place and the land on which it is situated. It
confers upon a particular family the right to enjoy such properties. 34 It cannot be seized
by creditors except in certain special cases. 35

However, the claim that the property is exempt from execution for being the movant's
family home is not a magic wand that will freeze the court's hand and forestall the
execution of a final and executory ruling. It must be noted that it is not sufficient for the
claimant to merely allege that such property is a family home. Whether the claim is
premised under the Old Civil Code or the Family Code, the claim for exemption must be
set up and proved.36

In fact, in Ramos, et al. v. Pangilinan, et al.,37 the Court, citing Spouses Kelley, Jr. v.
Planters Products, Inc., et al.,38 laid down the rules relative to the levy on execution of
the family home, viz.:
No doubt, a family home is generally exempt from execution provided it was duly
constituted as such. There must be proof that the alleged family home was constituted
jointly by the husband and wife or by an unmarried head of a family. It must be the
house where they and their family actually reside and the lot on which it is situated. The
family home must be part of the properties of the absolute community or the conjugal
partnership, or of the exclusive properties of either spouse with the latter's consent, or
on the property of the unmarried head of the family. The actual value of the family
home shall not exceed, at the time of its constitution, the amount of P300,000 in urban
areas and P200,000 in rural areas.39
In addition, residence in the family home must be actual. The law explicitly mandates
that the occupancy of the family home, either by the owner thereof, or by any of its
beneficiaries must be actual. This occupancy must be real, or actually existing, as
opposed to something merely possible, or that which is merely presumptive or
constructive.40

Guided by the foregoing jurisprudential tenets, it becomes all too apparent that Felicitas
cannot conveniently claim that the subject property is her family home, sans sufficient
evidence proving her allegation. It bears emphasis that it is imperative that her claim
must be backed with evidence showing that the home was indeed (i) duly constituted as
a family home, (ii) constituted jointly by the husband and wife or by an unmarried head
of a family, (iii) resided in by the family (or any of the family home's beneficiaries), (iv)
forms part of the properties of the absolute community or the conjugal partnership, or
of the exclusive properties of either spouse with the latter's consent, or property of the
unmarried head of the family, and (v) has an actual value of Php 300,000.00 in urban
areas, and Php 200,000.00 in rural areas.

A perusal of the petition, however, shows that aside from her bare allegation, Felicitas
adduced no proof to substantiate her claim that the property sought to be executed is
indeed her family home.

Interestingly, Felicitas admitted in her Motion for Reconsideration dated December 23,
2013, and her Petition for Annulment of Judgment dated June 22, 2006, that she is, and
has always been a resident of Mu�oz, Nueva Ecija. 41 Similarly, the address indicated
in Felicitas' petition for review on certiorari is Mu�oz, Nueva Ecija.42

Equally important, the Court takes judicial notice of the final ruling of the RTC Branch 55
in the case for recovery of ownership, that the subject property has belonged to the
Heirs of Nivera since the 1950s.43 This automatically negates Felicitas' claim that the
property is her family home.

Undoubtedly, Felicitas' argument that the property subject of the writ of execution is a
family home, is an unsubstantiated allegation that cannot defeat the binding nature of a
final and executory judgment. Thus, the Writ of Execution and Demolition issued by the
RTC Branch 55 must perforce be given effect.

In fine, an effective and efficient administration of justice requires that once a judgment
has become final, the winning party should not be deprived of the fruits of the verdict.
The case at bar reveals the attempt of the losing party to thwart the execution of a final
and executory judgment, rendered by. the court thirteen (13) long years ago. The Court
cannot sanction such vain and obstinate attempts to forestall the execution of a final
ruling. It is high time that the case be settled with finality and the ruling of the RTC
Branch 55 be given full force and effect.

WHEREFORE, premises considered, the instant petition is DENIED for lack of merit.
Accordingly, the Decision dated December 6, 2013 and Resolution dated August 7,
2014, rendered by the Court of Appeals in CA-G.R. CV No. 97309 are AFFIRMED in
toto.

SO ORDERED.

Carpio, (Chairperson), Peralta, Perlas-Bernabe, and Caguioa, JJ., concur.

CORDOVA V. TY
THIRD DIVISION

G.R. No. 246255, February 03, 2021

TERESITA CORDOVA AND JEAN ONG CORDOVA, Petitioners, v. EDWARD TY,

Respondent.

DECISION

DELOS SANTOS, J.:

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Rules of
Court which assails the Decision1 dated November 15, 2018 and the Resolution 2 dated
April 2, 2019 rendered by the Court of Appeals (CA) in CA-G.R. SP No. 155547. The CA
granted respondent Edward Ty's (Ty) appeal and reinstated the writ of execution issued
by the Metropolitan Trial Court (MeTC) of Manila, Branch 27.

The Case

The instant controversy arose from a writ of execution issued to satisfy the civil aspect
of the Decision3 dated July 27, 2007 of the MeTC for eleven (11) counts of violation of
Batas Pambansa Blg. (B.P.) 224 filed by Ty against Chi Tim Cordova (Chi Tim) and Robert
Young (Young).5

Chi Tim is the husband of petitioner Teresita O. Cordova (Teresita) and the father of
petitioner Jean Ong Cordova (Jean; collectively, petitioners). Petitioners seek the
exclusion of the following properties from execution: (1) parcel of land covered by
Transfer Certificate of Title (TCT) No. 77973 (TCT No. 77973 property); and (2)
condominium unit covered by Condominium Certificate of Title (CCT) No. 4441 (CCT No.
4441 property; collectively, subject properties) on the ground that the subject
properties were part of the paraphernal property of Teresita and the family home,
respectively.6

The Facts

On July 27, 2007, the MeTC rendered a Decision 7 on the civil aspect8 of the B.P. 22 case
filed against Chi Tim and Young, finding them jointly and solidarily liable for the
amounts of P6,200,000.00 representing the value of the bounced checks and
P100,000.00 as attorney's fees and other litigation expenses. The MeTC ruled that Chi
Tim and Young drew checks using the account of their company, Wood Technology
Corporation (Wood Technology), in order to obtain cash from Ty. The MeTC did not give
credence to their bare assertions that these checks were for the payment of
suppliers, i.e., corporate obligations, in view of their failure to present any evidence to
that effect.

After the Decision became final and executory, 9 Ty moved for the issuance of a writ of
execution which was granted by the MeTC. The subject properties levied to be sold in a
public auction are particularly described as follows: 10
(1) TCT No. 77973 property pertains to a parcel of land containing an area of 125
square meters registered in accordance with the provisions of the Property Registration
Decree in the name of Teresita O. Cordova, of legal age, married to Chi Tim Cordova,
both Filipino citizens; and

(2) CCT No. 4441 property pertains to Unit 10-A located on the tenth floor, with an area
of 133.48 square meters, more or less with three (3) rooms, three (3) comfort rooms, of
the Blue Diamond Tower Condominium Project located in C. Masangkay, Tondo, Manila
is registered in the name of Cordova Chi Tim of legal age, married to Teresita Cordova,
both Filipino citizens.
Petitioners filed a Very Urgent Motion to Exclude their Properties from the Auction Sale
before the MeTC. The MeTC merely noted this motion, 11 which impelled petitioners to
file a Petition for Prohibition and Mandamus with Prayer for Issuance of a Writ of
Preliminary Injunction and/or Restraining Order 12 before the Regional Trial Court (RTC)
of Manila, Branch 32.

The petition before the RTC was anchored on the claim that the liability from the B.P. 22
case was a corporate obligation and for this reason, Chi Tim should not be held
personally liable. As regards the claim for exemption, petitioners alleged that the TCT
No. 77973 property was exclusively owned by Teresita, which she purchased using
funds donated to her by her father; while the CCT No. 4441 property was the Cordova
family home and presently, utilized by Jean as her own family home. 13

Ruling of the RTC

On July 21, 2017, the RTC issued an Order 14 granting the application for the issuance of
a temporary restraining order incorporated in the Petition for Prohibition
and Mandamus. The RTC held that: (a) the checks subject of the complaint for B.P. 22
belonged to Wood Technology as shown on the upper right portion of the checks; (b) Chi
Tim and Young, as Wood Technology's officers and authorized signatories, should not be
held personally liable as any liability belongs to the corporation; (c) there was no
indication in the Decision of the MeTC that the veil of corporation fiction had been
pierced and for this reason, it was erroneous for the lower court and the sheriff to levy
the subject properties; and (d) there was no reason to doubt Jean's assertion that the
CCT No. 4441 property was their family home and thus, exempt from execution up to a
certain amount.

On September 7, 2017, the RTC issued another Order 15 granting the preliminary
prohibitory injunction. Aside from ruling that the elements for the issuance of injunctive
relief were satisfied by petitioners, the RTC held that as regards the CCT No. 4441
property: (a) it was registered in the Register of Deeds of Manila on February 14, 1984
in the name of Cordova Chi Tim, married to Teresita Cordova; (b) it became a family
home by operation of law and thus, exempt from execution; (c) Ty neither disputed that
Jean is the daughter of Chi Tim and Teresita, nor that Jean and her own family reside in
the same condominium unit; and (d) the claim of exempt status was timely raised, that
is, before sale at a public auction. 16

With regard to the TCT No. 77973 property, the RTC found that: (a) the sale was
registered on January 20, 1993 at the Registry of Deeds of Quezon City; (b) the Deed of
Absolute Sale signed on January 19, 1993 shows that the sole vendee was Teresita; and
(c) while Teresita was described as "married to Chi Tim Cordova", this was added for no
other purpose but to describe her civil status. 17

On November 16, 2017, the RTC rendered a Decision 18 which permanently restrained
the sale of the subject properties. The RTC adopted the discussion in its previous Orders
as the ratio decidendi for its Judgment.

Ty sought reconsideration, but was denied.

Ruling of the CA

On November 15, 2018, the CA rendered the assailed Decision 19 which granted Ty's
appeal. The CA found no grave abuse of discretion on the part of the MeTC as to
warrant the issuance of a writ of prohibition and mandamus, and struck down
petitioners' unsubstantiated allegations of exemption over the subject properties.

With regard to the TCT No. 77973 property, the CA ruled that the fact that it was
acquired during the subsistence of Teresita's marriage with Chi Tim was sufficient to
hold it as conjugally-owned and could be executed to satisfy the latter's civil obligation.
There was no definite proof that Teresita acquired the property using her own funds or
that the conjugal partnership of gains, which governed her property relationship with
her husband, had been severed at the time of the property's purchase. Similarly, the
claim of exemption for the CCT No. 4441 property based solely on the unproven
allegation of Jean that it was constituted as a family home, and for this reason, was not
sustained.20

Petitioners sought reconsideration which was denied in the assailed Resolution 21 dated
April 2, 2019.

Dissatisfied, petitioners filed this Petition for Review on Certiorari, raising the following
issues:chanroblesvirtualawlibrary
(A)

THE PRESUMPTION, OR EVEN THE FACT THAT A PROPERTY IS CONJUGAL, DOES NOT
MAKE IT AUTOMATICALLY LIABLE FOR THE PERSONAL OBLIGATION OF ANY OF THE
SPOUSES ABSENT ANY SHOWING THAT SUCH PERSONAL DEBT REDOUNDED TO THE
BENEFIT OF THE FAMILY.

(B)

THE FACT IS THAT THE PERSONAL OBLIGATION OF CHI TIM CORDOVA HERE, THE
HUSBAND OF PETITIONER TERESITA, DID NOT REDOUND TO THE BENEFIT OF HIS FAMILY
WHICH HE ALREADY ABANDONED EVEN BEFORE HE CONTRACTED OR WAS ADJUDGED
LIABLE FOR SUCH PERSONAL DEBT.22
Petitioners' Arguments

Petitioners alleged that the appellate court erred in holding the subject properties liable
to the personal obligation of Chi Tim on the basis of conjugality alone. Citing Article 121
of the Family Code, they aver that before the conjugal partnership is made liable for the
personal debt of one of the spouses, it must be shown to have redounded to the benefit
of the family. Further, petitioners aver that under Article 160 of the Family Code, certain
facts must be established before a family home is subjected to execution. Having failed
to establish these aforementioned facts, the subject properties may not be levied upon
and executed to satisfy Chi Tim's civil liability. 23

The Issue

Essentially, the main issue for resolution is whether or not the subject properties may
be executed to satisfy the civil liability of Chi Tim arising from the B.P. 22 case.

The Court's Ruling

The Petition is meritorious.

The subject
properties belong
�
to the conjugal
partnership.

It is basic that in Rule 45 petitions, only questions of law may be put into
issue.24 However, in this case, the conflicting findings of the RTC and the CA impel the
Court to make its own factual findings for the proper resolution of this controversy. 25

Preliminary to the proper evaluation on whether the subject properties may be executed
upon is the determination of whether the subject properties, are part of the conjugal
assets of Chi Tim and Teresita.

Records show that the spouses were married prior to the effectivity of the Family Code
and did not execute any pre-nuptial agreement; thus, their property relations is
governed by conjugal partnership of gains. 26 Further, under Article 160 of the 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." 27 In Ching v.
Court of Appeals,28 the Court held that it is not even necessary to prove that the
properties were acquired with funds of the partnership. Even when the manner in which
the properties were acquired does not appear, the presumption will still apply, and the
properties will still be considered conjugal. In order to rebut the presumptive conjugal
nature of the property, a movant must present strong, clear and convincing evidence of
exclusive ownership of one of the spouses. The burden of proving that the property
belongs exclusively to the wife or to the husband rests upon the party asserting it. 29

Applying the foregoing principles, the appellate court correctly ruled that the TCT No.
77973 property was not the paraphernal property of Teresita. It is undisputed that the
TCT No. 77973 property was acquired during the marriage of Chi Tim and Teresita. The
fact that Teresita was identified as the sole vendee and registered owner in the Deed of
Absolute Sale30 dated January 19, 1993 and a copy of the title 31 respectively, did not
destroy its conjugal nature as the registration of the property is not conclusive evidence
of the exclusive ownership of the husband or the wife. 32 Even if the property appears to
be registered solely in the name of either spouse, it has the inherent character of
conjugal property if it was acquired for valuable consideration during marriage. 33

Bare allegation is not evidence and is not equivalent to proof. 34 Save for petitioners'
assertions that Teresita purchased the TCT No. 77973 property using her exclusive
funds which were "donated" to her by her father, 35 no other evidence was presented to
substantiate this claim. Notably, only Jean testified before the RTC that it was her
mother, Teresita, who purchased the property using her exclusive funds. As properly
pointed out by Ty in his Comment/Opposition, 36 there is no showing that Jean even had
personal knowledge on the circumstances surrounding the sale as to be given full
weight and credit. All told, the registration of the property in the name of Teresita and
the unilateral declaration made by Jean do not meet the clear and convincing evidence
contemplated by law to overthrow the presumption of conjugality. 37

Petitioners concede that the CCT No. 4441 property is part of the conjugal properties of
Chi Tim and Teresita,38 because it is their family home.

The claim that a property is a family home is not a magic wand that will freeze the
court's hand and forestall the execution of a final and executory ruling. The Court,
in Salazar v. Felias,39 held that the claim for exemption must be set up and proved,
whether the claim for exemption of the family home is premised under the Civil Code or
the Family Code. Here, the Court finds that the appellate court's determination that the
CCT No. 4441 property was not proven to be petitioners' family home is borne out by
the records. The Court quotes with approval the findings of the appellate court as stated
in the assailed Decision, to wit:chanroblesvirtualawlibrary
In this case, records reveal that apart from alleging that she was a beneficiary of Chi
Tim, Jean fell short in establishing that (i) the condominium unit was indeed constituted
as a family home; (ii) that it was constituted jointly by her parents, Chi Tim and
Teresita; (3) that the property has an actual value of PhP300,000.00, it being located in
an urban area. In fact, in her testimony, Jean merely recounted that she lived with her
parents under "one roof", but never identified it to be the subject condominium unit. 40
Moreover, the appellate court's findings and conclusions are consistent with law and
jurisprudence with regard to the requisites before a family home may be considered as
such and resultantly, be exempted from execution. As held in FEB Mitsui Marine
Insurance Co., Inc. v. Manalastas:41chanrobleslawlibrary
In order for the property to be considered as a family home, the requisites must be
established: (a) it must be the house where he and his family actually reside and the lot
on which it is situated; (b) the family home must be part of the properties of the
absolute community or the conjugal partnership, or of the exclusive properties of either
spouse with the latter's consent, or on the property of the unmarried head of the family;
and (c) the actual value of the family home shall not exceed, at the time of its
constitution, the amount of P300,000.00 in urban areas and P200,000.00 in rural areas.

It must be emphasized that the law requires for purposes of determining a family home
that the residence must be actual. It explicitly mandates that the occupancy of the
family home, either by the owner or by any of its beneficiaries, must be actual. This
occupancy must be real, or actually existing, as opposed to something merely possible,
or that which is mere y presumptive or constructive.42
None of these requisites were met by petitioners. Instead, petitioners attempted to shift
the burden to Ty by asserting that he failed to comply with the requisites before a
family home may be validly executed,43 namely: (1) there was an increase in its actual
value; (2) the increase resulted from voluntary improvements on the property
introduced by the persons constituting the family home, its owner or any of its
beneficiaries; and (3) the increased actual value exceeded the maximum allowed under
Article 157 of the Family Code.44 However, this burden never shifted to Ty inasmuch as
the CCT No. 4441 property was not proven to be the family home of petitioners to begin
with. Since this essential fact is wanting in this case, there is no exemption to speak of
with respect to the CCT No. 4441 property.

In fine, it being established that the subject properties were purchased during the
subsistence of the marriage between Chi Tim and Teresita, and in the absence of clear
and convincing evidence to the contrary, the presumption of conjugality of the subject
properties prevails.

The subject
properties may
not be executed
upon to satisfy
Chi Tim's civil
liability.

As earlier discussed, Chi Tim and Teresita were married when the Civil Code was still
the operative law on marriages. The presumption, absent any evidence to the contrary,
is that they were married under the regime of conjugal partnership of gains. However,
the subsequent enactment of the Family Code superseded the terms of conjugal
partnership under the Civil Code.45 Thus, to resolve the issue of whether the subject
properties may be answerable for the civil liability imposed on Chi Tim, the Court must
refer to the applicable Family Code provisions.

Under Article 121 (3) of the Family Code, the conjugal partnership is liable for "debts
and obligations contracted by either spouse without the consent of the other to the
extent that the family may have benefited." Prescinding from this provision, petitioners
contend that the conjugality of the subject properties alone does not mean it should
automatically be bound to answer for the personal debt of one spouse. 46 Thus, they
allege that Ty must establish that the loans subject of the B.P. 22 case redounded to the
benefit of petitioners' family before the conjugal partnership may be held liable.

Petitioners' argument is well-taken.

Notwithstanding Ty's right to enforce the Decision of the MeTC, he cannot obtain
satisfaction by executing upon the subject properties. Settled is the rule that conjugal
property cannot be held liable for the personal obligation contracted by one spouse,
unless some advantage or benefit is shown to have accrued to the conjugal
partnership.47 Article 122 of the Family Code is emphatic:chanroblesvirtualawlibrary
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 partnership except insofar
as they redounded to the benefit of the family. x x x
In Philippine National Bank v. Reyes, Jr.,48 the Court interpreted the term for the benefit
of the conjugal partnership and discussed two (2) scenarios, to
wit:chanroblesvirtualawlibrary
(A) If the husband himself is the principal obligor in the contract, i.e., he
directly received the money and services to be used in or for his own business
or his own profession, that contract falls within the term "x x x obligations for
the benefit of the conjugal partnership." Here, no actual benefit may be proved. It
is enough that the benefit to the family is apparent at the time of the signing of the
contract. From the very nature of the contract of loan or services, the family stands to
benefit from the loan facility or services to be rendered to the business or profession of
the husband. It is immaterial, if in the end, his business or profession fails or does not
succeed. Simply stated, where the husband contracts obligations on behalf of
the family business, the law presumes, and rightly so, that such obligation
will redound to the benefit of the conjugal partnership.

(B) On the other hand, 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. No presumption can be inferred
that, when a husband enters into a contract of surety or accommodation agreement, it
is "for the benefit of the conjugal partnership." Proof must be presented to establish
benefit redounding to the conjugal partnership. 49 (Emphases supplied)
Contrary to Ty's assertion, the first scenario is not squarely applicable to the present
case.50 While Chi Tim directly received the money from the bounced checks, there was
no showing that it was used in the business or in the exercise of his profession for the
legal presumption that it redounded to the benefit of the family to apply. It must be
recalled that in the MeTC Decision, the court held that there was no proof that the
money obtained from the encashed checks were issued to pay the suppliers of Wood
Technology.51 Instead, the circumstances of the case revealed that these checks were
drawn by Chi Tim and Young for rediscounting for their personal benefit. It can thus be
deduced from the foregoing that the loans obtained from Ty were not used by Chi Tim
in his business or in the exercise of his profession. Otherwise, these would be corporate
obligations for which they could not be personally liable in view of the separate
personality of the corporation.

As there is no presumption, Ty was burdened to prove actual benefit to the family or the
spouses. As explained in Homeowners Savings & Loan Bank v.
Dailo,52 thus:chanroblesvirtualawlibrary
The burden of proof that the debt was contracted for the benefit of the
conjugal partnership of gains lies with the creditor�party litigant claiming
as such. Ei incumbit probatio qui dicit, non qui negat (he who asserts, not he
who denies, must prove). Petitioner's sweeping conclusion that the loan obtained by
the late Marcelino Dailo, Jr. to finance the construction of housing units without a doubt
redounded to the benefit of his family, without adducing adequate proof, does not
persuade this Court. Other than petitioner's bare allegation, there is nothing from the
records of the case to compel a finding that, indeed, the loan obtained by the late
Marcelino Dailo, Jr. redounded to the benefit of the family. Consequently, the conjugal
partnership cannot be held liable for the payment of the principal
obligation.53 (Emphasis supplied)
There is nothing on record which shows that the loans redounded to the benefit of the
conjugal partnership. It bears pointing out that contrary to Ty's assertion, 54 he was not
deprived of the opportunity to present evidence before the RTC. Records show that
while Ty was not able to cross-examine Jean during the hearing for the issuance of
temporary restraining order and preliminary injunction, he was not denied due process
insofar as he was given the opportunity to be heard. For reasons unknown to the Court,
Ty opted not to present evidence or any other pleadings and thus, the petition for
prohibition and mandamus was resolved on the basis of pleadings on record. 55 Thus, Ty
must now bear the consequences of his actions.

Finally, the Court would like to make a distinction between the present case and its
rulings in Pana v. Heirs of Juanite, Sr.56 and Dewara v. Spouses Lamela57 where the issue
of whether conjugal properties may be levied to answer for the civil liability adjudged
against one spouse in a criminal case was resolved. Citing Article 122 of the Family
Code,58 the Court therein ruled in the affirmative. Under this provision, by exception,
fines and indemnities may be may be enforced against the partnership assets provided
the following conditions concur: (1) the responsibilities enumerated under Article 121 of
the Family Code have been covered; and (2) the spouse liable either has no exclusive
property or the same is found insufficient. In Pana and Dewara, the erring spouses were
found guilty beyond reasonable doubt of the crimes charged against them and thus, the
civil liabilities imposed are interpreted to fall within the purview of "fines and
indemnities" referred to in Article 122 of the Family Code. In the present case, however,
the criminal case was dismissed and only the civil aspect of the B.P. 22 case was
resolved, i.e., the liability for the loans obtained by Chi Tim as evidenced by the
bounced checks, and thus, is properly characterized as a "debt or obligation."

All told, the civil aspect arising from the eleven (11) counts of B.P. 22 cannot be
satisfied by executing the subject properties, which are conjugal properties, absent
adequate proof that the loans obtained by Chi Tim redounded to the benefit of
petitioners.

WHEREFORE, the Petition for Review on Certiorari is GRANTED. The Decision dated
November 15, 2018 and the Resolution dated April 2, 2019 rendered by the Court of
Appeals in CA-G.R. SP No. 155547 are REVERSED and SET ASIDE. Accordingly, the
Decision dated November 16, 2017 rendered by the Regional Trial Court in Civil Case
No. R-MNL-17-00658-CV is AFFIRMED.

SO ORDERED.

ALBERTO HIDALGO v. BASCUGUIN

THIRD DIVISION

[ G.R. No. 233217. October 06, 2021 ]

ALBERTO C. HIDALGO, PETITIONER, VS. CONRADO BASCUGUIN AND EVELYN

FLAMINIANO HIDALGO, RESPONDENTS.

DECISION

LEONEN, J.:

Under the Family Code, any encumbrance or disposition of conjugal property executed without
the consent of one of the spouses is void.

This Court resolves a Petition for Review on Certiorari assailing the Court of Appeals
Decision1 and Resolution2 reversing the Regional Trial Court Decision3 and annulling the pacto de
retro sale between Conrado Bascuguin (Bascuguin) and Spouses Alberto C. Hidalgo and Evelyn
Flaminiano Hidalgo (the Hidalgo Spouses).

Alberto C. Hidalgo (Alberto) alleged that during their marriage, he and his wife, Evelyn
Flaminiano-Hidalgo (Evelyn), acquired a house and lot in Lian, Batangas.4 Alberto worked in Dubai,
United Arab Emirates.5 When he returned to the Philippines in March 2004, he discovered that
Evelyn had sold the house and lot to Bascuguin for P300,000.00 without Alberto's consent.6 The
sale was evidenced by a December 9, 2002 document and denominated as "Kasulatan ng Bilihan ng
Bahay at Lupa na Muling Mabibili" (Kasulatan).7

On April 22, 2004, Alberto sent a Demand Letter8 to Bascuguin stating that the transaction was
null and void for lack of his consent. He also expressed his willingness to refund the P300,000.00
purchase price, plus legal interest, if Bascuguin returns the property title.9

In response, Bascuguin demanded the Hidalgo Spouses to pay P900,000.00 and threatened to
eject them and consolidate his ownership over the property, should they refuse to pay.10

On May 6, 2004, Alberto filed a Complaint11 for annulment of sale and damages against Evelyn
and Bascuguin.12 He asserted that he did not consent to the sale and that his signature on the
Kasulatan was forged.13 He further stated that he only arrived in the Philippines on December 23,
2002, as evinced by his passport, while the transaction was executed on December 9, 2002.14 He
then sought P100,000.00 in moral damages and P50,000.00 in attorney's fees.15

On May 27, 2004, Bascuguin filed his Answer16 and alleged that in December 2002, Evelyn
begged him to purchase the property in a sale with right to repurchase, or a pacto de
retro sale.17 He acceded, since the Hidalgo Spouses were family friends with whom he had
previously made similar agreements.18 Further, it was agreed that Evelyn would repurchase the
property within five months.19 Thus, Bascuguin argued that he should not be faulted for the alleged
forgery on the Kasulatan, since he only relied on Evelyn's assurance that it was properly
executed.20 Further, he was also willing to let the Hidalgo Spouses repurchase the property.21

The Regional Trial Court rendered a Decision22 ordering the Hidalgo Spouses to reimburse the
purchase price to Bascuguin, with legal interest from the time of the transaction until full payment. It
further ordered Bascuguin to return the property title to the Hidalgo Spouses upon his receipt of the
payment and interest. The dispositive portion of the Decision reads:

WHEREFORE, this Court rendered judgment as follows:

 The transaction between Evelyn Flaminiano-Hidalgo and Conrado Bascuguin will be

considered as equitable mortgage:
 Spouses Alberto C. Hidalgo and Evelyn Flaminiano-Hidalgo must reimburse Conrado
Bascuguin the amount of three hundred thousand (Php 300,000.00) pesos plus legal
rate of interest from the time of the transaction until the mortgage had been fully paid:
 The Defendant Conrado Bascuguin must return the title to Spouses Alberto C.
Hidalgo and Evelyn Flaminiano-Hidalgo upon payment of the principal plus legal rate
of interest:
 No award of damages and attorney's fees:

The cost of suit chargeable against the Plaintiff.

SO ORDERED.23

The trial court held that the true nature of the contract between Evelyn and Bascuguin was that
of an equitable mortgage. As to damages, the trial court found that Alberto failed to present sufficient
evidence to support any award of damages or attorney's fees.24 Unsatisfied, Alberto moved for
reconsideration, but to no avail.25

Upon appeal, the Court of Appeals reversed the Regional Trial Court Decision and found that
the pacto de retro sale was void for lack of Alberto's consent.26 The dispositive portion reads:

WHEREFORE, the appeal is GRANTED. The decision dated September 12,

2011 and resolution dated January 20, 2012 of the Regional Trial Court of Nasugbu,
Batangas, Branch 14 in Civil Case No. 831 are SET ASIDE. A new decision is
rendered declaring thus:

1. The sale with right to repurchase dated November 9, 2002 is

VOID.

2. Defendant-appellee Conrado Bascuguin is ordered to return

Transfer Certificate of Title No. T-57168 to Spouses Alberto and
Evelyn Hidalgo.

3. Spouses Alberto and Evelyn Hidalgo are directed to return

the amount of P300,000.00 to defendant-appellee Conrado
Bascuguin with annual interest at the rate of 12% from September
12, 2011 until June 30, 2013 and 6% from July 1, 2013 until the
finality of this decision.
 4. The total award shall further earn interest at the rate of
6% per annum from finality of this decision until full payment.

SO ORDERED.27

The Court of Appeals applied Article 124 of the Family Code and held that any disposition or
encumbrance of a conjugal property made without either spouse's consent is void.28 Since the
transaction was void, the Court of Appeals found that it was no longer necessary to determine the
contract's true nature.29 Nevertheless, as a necessary effect of the sale's nullification, the Court of
Appeals directed the return of the purchase price to Bascuguin and of the title to the Hidalgo
Spouses.30 It also held that legal interest begins to run from the Regional Trial Court Decision's date
or the date when the obligation to return the amount accrued.31

On December 8, 2016, Alberto filed a Motion for Partial Reconsideration.32 In a May 31, 2017
Resolution,33 the Court of Appeals denied the Motion for being filed late.34

On September 20, 2017, Alberto filed the present Petition for Review on Certiorari.35 Thereafter,
respondent Conrado Bascuguin filed his Comment.36 Petitioner Alberto C. Hidalgo then filed a
Reply.37

Petitioner argues that: (1) the Court of Appeals erred in denying his motion; (2) he cannot be
made to pay the purchase price in the pacto de retro sale; and (3) he is entitled to damages.38

Petitioner explains that the copy of the Court of Appeals Decision furnished to his counsel was
unserved and returned to the Court of Appeals with the notation "MOVED OUT" on the
envelope.39 Petitioner's counsel only learned of the Decision on December 1, 2016 when petitioner
sent him a screenshot of the decision.40 After the death of an office administrator, Petitioner's
counsel explains that his office in Makati City was closed, and that the office staff presumed that
notices of change of address had been filed for every case they handled.41

On the merits, petitioner asserts that he cannot be ordered to reimburse the price, much less
pay interest, considering that the sale is void for lack of his consent under Article 124 of the Family
Code.42 He posits that he is entitled to moral and exemplary damages to compensate for the mental
anguish caused by respondents' acts made in bad faith.43 He also claims that he is entitled to
attorney's fees, considering he was forced to litigate and incur expenses to protect his rights and
interest.44

In respondent Bascuguin's Comment, he maintains that under Article 1398 of the Civil Code, he
is entitled to reimbursement of the purchase price with interest, and that petitioner is not entitled to
damages.45 He also argues that the Court of Appeals Decision is already final and executory,
considering the belated filing of petitioner's motion.46

In his Reply,47 petitioner reiterates that the late filing of his motion was excusable by force of
circumstances48 and that he cannot be made to reimburse the purchase price for a transaction that
he never consented to.49 He also emphasized his entitlement and attorney's fees.50

The issues for this Court's resolution are the following:

First, whether or not the petition must be denied outright;

 Second, whether or not the sale is null and void;

Third, whether or not respondent is entitled to reimbursement; and

Fourth, whether or not petitioner is entitled to damages.

Under Rule 52, Section 1 of the Rules of Court51 "a party may file a motion for reconsideration
of a judgment or final order within fifteen (15) days from notice thereof[.]" If no motion for
reconsideration is filed within this period, the judgment or final order becomes final.52

Rule 13, Section 2 of the Rules of Court53 provides that when a party is represented by counsel,
service upon the litigant should be made through the party or the counsel. As a rule, the negligence
of counsel binds their client.54 This Court has repeatedly admonished lawyers for negligence in
giving notice to the courts for their change in address. Such inadvertence may prove to be fatal to
their client's cause.55 In Juane v. Garcia56:

The time has come, we believe, for this Court to remind the members of the Bar
that it is their inescapable duty to make of record their correct address in all cases in
which they are counsel for a suitor. For, instances there have been in the past when,
because of failure to inform the court of the change of address, litigations were
delayed. And this, not to speak of inconvenience caused the other parties and the
court. Worse still, litigants have lost their cases in court because of such negligence
on the part of their counsel. It is painful enough for a litigant to suffer a setback in
legal battle. It is doubly painful if defeat is occasioned by his attorney's failure to
receive notice because the latter has changed the place of his law office without
giving the proper notice therefor. It is only when some such situation comes about
that the negligent lawyer comes to realize the grave responsibility that has incurred
both to his client and to the cause of justice. It is then that the lawyer is reminded
that in his oath of office he solemnly declared that he "will conduct" himself "as a
lawyer according to the best of his knowledge and discretion". Too late. Experience
indeed is a good teacher. To a lawyer, though, it could prove very expensive.57

Macondray & Co. Inc. v. Provident Insurance, Corp.58 specifically pronounced that "[i]f counsel
moves to another address without informing the court of that change, such omission or neglect is
inexcusable and will not stay the finality of the decision."59

Here, the notice of change of address was not filed simply because petitioner's counsel
assumed that his staff filed the notice.60 He cannot rid himself of responsibility by blaming it on the
actions of others. This constitutes inexcusable negligence on the part of petitioner's counsel.

Unfortunately for petitioner, the negligence of his counsel has allowed the Court of Appeals
Decision to lapse into finality and, as held in Social Security System v. Isip,61 "no court . . . can
exercise appellate jurisdiction to review a case or modify a decision that has bec[o]me
final."62 Neither does the petition invoke the recognized exceptions to the doctrine of immutability of
judgments.

In any case, service to petitioner is sufficient. The Court of Appeals pointed out that petitioner
received a copy of the decision on November 28, 2016.63 Thus, petitioner only had until December
13, 2016 to file the motion for reconsideration.

Notwithstanding its procedural defects, the Petition is devoid of merit to warrant the assailed
decision's reversal.

II

Under Article 166 of the New Civil Code, alienation or encumbrance of a conjugal property
requires the consent of both spouses.64 Article 173 further states that if the wife did not consent to
the transaction, she may seek its annulment within 10 years.65 Thus, without the wife's consent, the
transaction is deemed voidable.66 These provisions are intended to protect the wife against the
husband's illegal alienation of their property.67 This is in contrast with the Old Civil Code, which
gives the husband full authority to alienate or encumber conjugal property.68

Articles 166 and 173 of the New Civil Code were not reproduced in the Family Code, which
changed the rules on disposition and encumbrance of properties.

The Family Code clearly states that dispositions or encumbrances of community or conjugal
properties without the other spouse's written consent are void. The identical paragraphs of Articles
9669 and 12470 provide:

In the event that one spouse is incapacitated or otherwise unable to participate

in the administration of the common properties, the other spouse may assume sole
powers of administration. These powers do not include the powers of disposition or
encumbrance without the 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 offerers.71 (Emphasis supplied)

This Court has consistently declared void any disposition or encumbrance without consent of
one of the spouses under the Family Code.72

In Jader-Manalo v. Spouses Camaisa,73 this Court held that the sale of a conjugal property is
void for lack of the wife's consent. The petitioner bought a ten-door apartment from the respondents.
However, the wife later changed her mind and did not sign the contract to sell. The petitioner then
filed a complaint for specific performance to compel the wife to sign, but this was dismissed by the
trial court. The dismissal was affirmed by the Court of Appeals.74

In affirming the lower courts' rulings, this Court held that for the sale to be executed, the consent
of both spouses must concur. Considering that the wife refused to give her consent, the contract to
sell signed solely by the husband is void. Even if she was aware of the negotiations and the contract,
mere awareness of the transaction is not consent.75

Similarly, in Spouses Aggabao v. Spouses Parulan,76 the respondent sold two parcels of land to
petitioners. She showed petitioners several documents including a Special Power of Attorney
allegedly executed by her husband authorizing the sale of the conjugal properties. Later on, the
respondent's husband assailed the validity of the sale for lack of his consent. The trial court and the
appellate courts ruled in favor of the husband.77

Upon appeal, this Court affirmed the nullity of the sale, considering that it was executed through
the forged signature of the husband. Citing Article 124 of the Family Code, this Court held that when
one of the spouses did not consent to the sale of a conjugal property, the sale is void.78

In Philippine National Bank v. Reyes, the respondent's wife mortgaged three conjugal properties
to the petitioner to secure a loan. The mortgaged properties were subsequently foreclosed for failure
to pay the loan obligations. The petitioner won in the bid and bought the properties. The respondent
then assailed the validity of the mortgage and sale claiming that he never consented to the loan and
that his signature was forged in the documents. The trial and appellate courts ordered the annulment
of the mortgage.

Affirming the lower courts, this Court ruled that the consent of both spouses is indispensable for
the disposition or encumbrance of a conjugal property. Given that the husband was able to show
that his signature was falsified in the loan documents, this Court held that the mortgage unilaterally
executed by the wife is void.79

Here, it is not disputed that the house and lot are conjugal properties of the Hidalgo
Spouses.80 Petitioner also sufficiently established that his signature on the December 9, 2002
Kasulatan was falsified, considering that he was not in the Philippines on the date of the sale's
execution.81 He arrived in the country only on December 23, 2002; thus, he could not have signed
the instrument.82 Therefore, for lack of written consent, the pacto de retro sale is void and it
produces no legal effect.

At any rate, neither party questions the Court of Appeals' finding of nullity. What they challenge
is the effect of the void contract, specifically whether respondent is entitled to the reimbursement of
the purchase price with legal interest.

When the terms of a void contract have been performed, the parties must be reinstated to their
original situation as legally and equitably possible.83 Article 1398 of the Civil Code clearly provides:

Article 1398. An obligation having been annulled, the contracting parties shall
restore to each other the things which have been the subject matter of the contract,
with their fruits, and the price with its interest, except in cases provided by law.

In obligations to render service, the value thereof shall be the basis for damages.

In Villanueva v. Chiong,84 this Court ruled that the sale of conjugal property made without one
spouse's consent was not void, and as a consequence, this Court applied Article 1398 and ordered
the return of the price the husband received for the land with interest. Similarly, Ines v. Court of
Appeals85 declared the reimbursement and imposition of legal interest proper following the nullity of
the sale for want of consent of one spouse. This was deemed as "a necessary consequence of the
finding that the Contract of Sale . . . is void in its entirety[.]"86 Bucoy v. Paulino, et. al.,87 likewise
applied this rule and ordered the restoration of the property to the parties.88

Strictly applying Article 1398 here, petitioner and respondents should be restored to their original
situation. Petitioner should be ordered to reimburse to respondent Bascuguin the purchase price
together with interest. On the other hand, respondent Bascuguin should return the title of the
property to petitioner.

Further militating against petitioner's claim that respondent Bascuguin is not entitled to
reimbursement is the fact that petitioner himself offered to return the purchase price in exchange for
the subject property's title.89

As held in Spouses Binarao v. Plus Builders, Inc.,90 the admitter, who is also the party, cannot
contradict judicial admissions.91 Admissions bind the person and it cannot be denied unless shown
that the statement was made through palpable mistake.92 In Metro Rail Transit Development
Corporation v. Gammon Philippines, Inc.,93 this Court held that the petitioner therein was bound by
its judicial admission stating it was willing to reimburse respondent for its claims.

Here, petitioner is bound by his own pleadings, his demand letter, and his statement in open
court expressing his willingness to reimburse respondent for the purchase price. There is also no
showing that the offer was made through a palpable mistake. In his demand letter, petitioner,
through counsel, stated:

In this connection, but without in any manner giving his approval, acceptance or
consent to the subject illegal transaction, my client, if only to buy peace, is willing to
return to you the amount of Three Hundred Thousand Pesos (P300,000.00) the
consideration stated in the questioned deed, plus legal interest, and for that purpose
hereby demands that title to the subject property which is now in your possession be
returned to him after the delivery of the aforesaid amount.94

Petitioner even testified before the Regional Trial Court that he proposed this arrangement:

Q: What did you do when you discovered that your house and lot was sold pacto de retro by your
wife?

A: I approached Mr. Conrado Bascuguin. I tried to plea with him if possible that I would pay him the
amount of P300,000.00 but he did not agree. He was asking that he needs some interest amounting
to P900,000.00.95

This constitutes an admission on petitioner's part that respondent is entitled to reimbursement of

the P300,000.00 price, plus legal interest.

III

Kierulf v. Court of Appeals96 explained that moral damages are awarded only if there is:

[P]leading and proof of moral suffering, mental anguish, fright and the like. While
no proof of pecuniary loss is necessary in order that moral damages may be
awarded, the amount of indemnity being left to the discretion of the court, it is
nevertheless essential that the claimant should satisfactorily show the existence of
the factual basis of damages and its causal connection to defendant's
acts.97 (Citations omitted)

On the other hand, exemplary damages are awarded only if the defendant acted with gross
negligence.98 This form of damages is:
 [D]esigned to permit the courts to mould behavior that has socially deleterious
consequences, and its imposition is required by public policy to suppress the wanton
acts of an offender. However, it cannot be recovered as a matter of right. It is based
entirely on the discretion of the court.99 (Citations omitted)

Meanwhile, attorney's fees cannot be recovered absent stipulation, subject to the exceptions
provided under Art. 2208 of the Civil Code.100

Here, there is no proof that petitioner is entitled to damages. The Regional Trial Court found that
petitioner failed to satisfactorily prove that respondents' acts directly caused his mental anguish or
moral suffering to justify an award of moral damages.101 There is no reason to deviate from this
finding. Similarly, petitioner failed to prove that he is entitled to exemplary damages. There is no
showing that respondents engaged in gross negligence or in behavior that has socially deleterious
consequences that would warrant the award of exemplary damages.

Petitioner likewise did not prove the existence of any of the circumstances that warrant the
award of attorney's fees under Article 2208 of the Civil Code.

Lastly, the Court of Appeals did not err in ordering the payment of legal interest. Pursuant
to Nacar v. Gallery Frames,102 the annual interest rate is 12% from the accrual of the obligation to
return the principal amount or the date of the Regional Trial Court Decision on September 12, 2011
until June 30, 2013, and then 6% until the Court of Appeals Decision attained finality on December
13, 2016. Thereafter, the annual interest rate shall be 6% from the finality of the Court of Appeals
decision until full payment as the interim period is equivalent to a forbearance of credit.

WHEREFORE, the Petition is DENIED for having shown no

reversible error in the assailed decision. The Decision of the Court
of Appeals in CA-G.R. CV No. 98529 is AFFIRMED.

SO ORDERED.

Carandang, Zalameda, Rosario, and Dimaampao,* JJ., concur.

TARUC v. MAXIMO
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