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CONJUGAL PARTNERSHIP OF GAINS

Art. 105.
If couple agree to have CPG as property regime,
provisions in this chapter shall be supplementary.
Provisions shall apply to CPG already established
between the spouses before effectivity of FC without
prejudice to vested rights already acquired in
accordance with the CC.
CC CPG if spouses did not adopt a different system
in the MS.
FC ACP default.
o If CPG, spouses can provide terms/rules to
govern partnership.
o If CPG but without stipulations, FC
provisions shall govern.
Marriages solemnized before FC governed by CPG,
continue CPG.
o If no MS establishing different regime, CPG,
and cant be changed by FC without
affecting vested rights acquired from the
celebration of the marriage.

Art. 106.
CPG H and W place in a common fund the fruits of their
separate properties and of their work or industry and divide
in equal parts, upon the dissolution of the union, the profits
and benefits indiscriminately obtained by either of the
spouses during the marriage.

Complete separation of capitals complete independence of
the capital account from the account of benefits pertaining to
the conjugal partnership.

CPG vs. Ordinary Partnership

CPG Ordinary Partnership
Exist from the mere fact of
marriage, even independently
of the will of the parties
Come to existence according
to the agreement of the
parties
Purpose, duration and rules
are predetermined by the
legislator, the law fixing its
conditions
All such matters are
determined by the will of
the partners
Profits are divided equally by
the spouses IRRESPECTIVE of
the amount of the capital
they bring to the marriage
Division of profits depends
upon the respective capitals
of the partners or upon their
agreement
No equality between the
spouses in its control,
management and disposition
(law has granted to husband
the predominance)
All the partners have the
same rights as to the
direction, management and
control of the partnership.
Not a juridical person Juridical person
Begins at precise moment of
celebration of marriage
Begins at any time agreed
upon by the parties.
Purpose is not for profit For profit
Dissolved upon death of one
spouses
Upon death of one partner,
surviving partners may
decided to continue the
partnership
No liquidation or division of
profits until after dissolution
There can be division of
profits without dissolution.

Art. 107 rules provided in Art. 88 and 89 shall also apply to
CPG.

Art. 88 begins at the precise moment of celebration of
marriage.
Art. 89 waiver of rights, interests, share and effects of the
ACP during the marriage by one spouse, is also applicable to
the CPG.

Art. 108 The CP shall be governed by the RULES ON THE
CONTRACT OF PARTNERSHIP in all that is not in conflict with
what is expressly determined in this Chapter or the spouses
in their marriage settlements.

Rules on partnerships govern CP in all matters that are not in
conflict or expressly determined in this Chapter or in the MS
of the spouses.

But unlike in ordinary partnerships, the liability of the
spouses for conjugal debts if the conjugal properties are not
sufficient to pay for the same is SOLIDARY (Art. 121). In
ordinary partnerships, the partners are generally liable for
partnership debts only pro rata and not in solidum.

EXCLUSIVE PROPERTY OF EACH SPOUSE

Art. 109. The following shall be exclusive property of each
spouse:
(by direct acquisition or property that is originally exclusive)
1) That which is brought to the marriage as his/her
own;
2) That which each acquires during the marriage by
gratuitous title;
(by substitution)
3) That which is acquired by right of redemption, by
barter or by exchange with property belonging to
only one of the spouses
4) That which is purchased with exclusive money of
the wife or of the husband

Property brought to the marriage
1) Acquired by a spouse prior to the marriage under a
defective title, where the defect of title was cured
during the marriage
2) Those alienated by a spouse prior to the marriage,
but are required by him/her during the marriage
because of the annulment, rescission or resolution
of the contract, or the revocation of the donation by
virtue of which it had been alienated.
3) Property actually delivered to the spouse during the
marriage, where the cause or consideration came
from such spouse prior to the marriage.

Acquisition by gratuitous title:
1) Those acquired during the marriage by inheritance,
devise, legacy or donation;
2) A gratuity given as a bounty or out of pure liberality
(gratis) by an employer to either spouse for long,
faithful and dedicated service;
3) Unearned increment (ex. increase in value of land
belonging to either spouse)
4) Moral damages awarded to either spouse for
personal injury sustained (but damages awarded for
hospitalization expenses, medical assistance, and
loss of salary are conjugal)
a. By the injury, the earning capacity of the
injured spouse is diminished; CP prejudiced.
b. Damages for injuries to feelings separate

Property acquired by right of redemption, barter or exchange
of exclusive property
1) Barter property inherited was exchanged to
another property.
2) Wife sold piece of land to X with the right to
repurchase before her marriage. During the
marriage, she and her husband redeemed it with
conjugal funds; land still paraphernal, but wife must
indemnify CP with the redemption money upon
liquidation.
3) Exchange: building was insured before marriage;
property was burned during marriage; insurance
money paraphernal.

Property purchased with exclusive money of either spouse:
- Law takes as basis, not the person in whose name or
favour the purchase is made, but the source of the
money employed in the purchase.

On co-ownership : depends upon the matter of acquisition:
a) If acquired by exercise of right of redemption
paraphernal
b) If acquired through purchase ownership depends
upon the source of the price paid.

On increase in value depends upon cause of increase
a) If because of investment of conjugal funds increase
in value shall be conjugal
b) If because of unearned increment or due only to
ordinary course of time or of things separate

Other separate properties:
1) Collection of credits belonging to one of the spouse
2) Sale of separate property of a spouse
3) Indemnity paid in case of expropriation of separate
property, or under an insurance policy

Art. 110. The spouses retain the ownership, possession,
administration and enjoyment of their exclusive properties.
Either spouse may, during the marriage, transfer the
administration of his or her exclusive property to the other
by means of PUBLIC INSTRUMENT which shall be recorded
in the registry of property of the place where property is
located.

No alienation, encumbrance or disposition of the property
without knowledge and consent of the owner-spouse.
Property cannot be attached to the debt of the administrator-
spouse.

Art. 111. A spouse of age may mortgage, encumber, alienate
or otherwise dispose of his or her exclusive property,
without the consent of the other spouse and appear alone
in court to litigate with regard to the same.

Art. 112. The alienation of any exclusive property of a
spouse administered by the other automatically terminates
the administration over such property and the proceeds of
the alienation shall be turned over to the owner-spouse.
Transfer of administration

Art. 113. Property donated or left by will to the spouses,
jointly and with designation of determinate shares, shall
pertain to the donee-spouse as his or her own exclusive
property, and in the absence of designation, share and share
alike, without prejudice to the right of accretion when
proper.
- Bec its acquired by lucrative or gratuitous title
- Right of accretion the other can get the others
share when either spouse:
o Refuses to accept
o Is incapacitated to accept
o Predeceases or dies before the perfection
of the donation.

Art. 114. If the donations are ONEROUS, the amount of the
charges shall be borne by the exclusive property of the done
spouse, whenever they have been advanced by the CPG.

Onerous donation one in which the donor has imposed
some obligation or charge upon the donee.

Art. 115. Retirement benefits, pensions, annuities,
gratuities, usufructs and similar benefits shall be governed
by the rules on gratuitous or onerous acquisitions as may be
proper in each case.
Gratuitous exclusive
Onerous conjugal
If act of pure beneficence, separate.
If it is a return of sums accumulated from salaries of the
spouse, conjugal, unless accumulated before the marriage.

Art. 116. All property acquired during the marriage, whether
the acquisition appears to have been made, contracted or
registered in the name of one or both spouses, is presumed
to be conjugal unless the contrary is proven.

Important points:
1. presumption applies even if manner in which property was
acquired is not shown
2. party invoking this presumption must first prove that the
property was acquired during the marriage
3. proof of acquisition during marriage is a condition for the
operation of this presumption
4. presumption prevails over ordinary rules of accession
5. presumption is rebuttable by strong, clear and convincing
evidence
6. presumption is stronger when creditors are involved
7. the burden of proof is on the party asserting that the
property is exclusively owned by a spouse.

In overthrowing the conjugal character
- recitals in deed of sale is not sufficient because to
permit such would make a spouse a sole arbiter of
character of property acquired during marriage
- property in name one spouse is not enough to
dispute the conjugality of a property BUT if there is
no date of acquisition, the fact that the title is
named after spouse makes the property exclusive.
- Proofs of paraphernal property
o Possession of some paraphernal funds
under her administration and available
investment
o Sufficiency of such funds for price of
property
o Investment of such funds in property in
question
- Source of funds is not material to the conjugality or
exclusivity of property because it is rather difficult to
determine.
- Acknowledgement of one spouse that the property
in question is conjugal is a strong evidence against
the party making admission or his/her heirs.