PARAGAS v.

HEIRS OF DOMINADOR BALACANO

(HINDI KO MAHANAP FT WEID)

FACTS:

Gregorio Balacano, married to Lorenza Sumigcay, was the registered owner of the disputed lots. Gregorio and Lorenza
had three children, namely: Domingo, Catalino and Alfredo. Petitioners were the grandchildren of Gregorio. Prior to his
death, Gregorio was admitted at the Veterans General Hospital. He was transferred in the afternoon of July 19, 1996 to the
Veterans Memorial Hospital in Quezon City where he was confined until his death. In his deathbed, barely a week before
he died, he allegedly signed a Deed of Absolute Sale over the lots in favor of the Paragas Spouses, accompanied by Atty.
De Guzman who proceeded to notarize the same, alleging that it was a mere confirmation of a previous sale and that
Gregorio had already paid a P 50,000.00
deposit. There was nothing to show that the contents of the deed were explained to Gregorio.

Paragas then sold a portion of the disputed lot to Catalino. The grandson of Gregorio, sought to annul the sale and
partition. There was no sufficient evidence to support any prior agreement or partial execution thereof.

Issue: W/N Balacano is capacitated to enter into a contract of sale.

Ruling:

A person is not rendered incompetent merely because of old age; however, when such age has impaired the
mental faculties as to prevent a person from protecting his rights, then he is undeniably incapacitated. He is
clearly at a disadvantage, and the courts must be vigilant for his protection. In this case, Gregorio’s consent
was clearly absent – hence the sale was null and void. The dubious circumstances raise serious doubts on his
capacity to render consent.

It is not disputed that when Gregorio signed the deed of sale, Gregorio was seriously ill, as he in fact died a week after the
deed’s signing. Gregorio died of complications caused by cirrhosis of the liver. Gregorio’s death was neither sudden nor
immediate; He fought at least a month-long battle against the disease until he succumbed to death on July 22, 1996.
Given that Gregorio purportedly executed a deed during the last stages of his battle against his disease, we seriously doubt
whether Gregorio could have read, or fully understood, the contents of the documents he signed or of the consequences of
his act. We note in this regard that Gregorio was brought to the Veteran’s Hospital at Quezon City because his condition
had worsened on or about the time the deed was allegedly signed. This transfer and fact of death not long after speak
volumes about Gregorio’s condition at that time. We likewise see no conclusive evidence that the contents of the deed
were sufficiently explained to Gregorio before he affixed his signature.
 GUIANG v.
CA
26 June 1998 | Panganiban, J. | Void or
Inexistent Contracts
DOCTRINE: Art. 1390, par. 2, refers to contracts with vices of consent, entered into by a person whose
consent was obtained and vitiated through mistake, violence, intimidation, undue influence or fraud.

FACTS:
 Spouses Gilda (private respondent) and Judie Corpuz bought a parcel of land Koranodal, South Cotabato,
where they established their conjugal dwelling. A few years later, they sold one-half of said land to
petitioners, spouses Antonio and Luzviminda Guiang.
 Gilda went to Manila to look for work. After her departure, Judie rarely went home.
 Harriet Corpuz informed her mother that her father was going to sell their portion of the lot, including the
house, to the Guiangs. Gilda replied that she was objecting to the sale but Harriet only informed Luzviminda
about it.
 On March 1, 1990, in the absence of his wife, Judie sold their one-half portion, and the house, for
P30,000, and executed a Deed of Transfer of Rights in favor of spouses Guiang.
 When Gilda returned, her husband was nowhere to be found. Luzviminda filed a complaint before
the Barangay authorities against Gilda and her children, who continued to stay in the house. The parties
eventually signed an amicable settlement, wherein Gilda and her children agreed to leave on or before
April 7, 1990.
 Later on, Gilda approached the Barangay Captain questioning her signature and requesting for the
annulment of the settlement, but it was unheeded.
 She filed a complaint against her husband and spouses Guiang and the RTC held that the Deed of
Transfer of Rights and the amicable settlement are null and void. Gilda is the rightful owner of the remaining
one-half portion of the lot. This was affirmed by the CA.

ISSUES:
WON the contract of sale (Deed of Transfer of Rights) is merely voidable?

HELD
NO, the contract was void and could not have been ratified.
• Guiangs’ defense that the contract was merely voidable cannot hold due to an erroneous application of Art.
1390 of the Civil Code, which enumerates voidable contracts.
• ARTICLE 1390, par. 2, refers to contracts visited by vices of consent, i.e., contracts which were entered
into by a person whose consent was obtained and vitiated through mistake, violence, intimidation,
undue influence or fraud. Gilda’s consent to the contract of sale of their conjugal property was totally
inexistent or absent.

• The contract falls properly within Art. 124 of the Family Code.
• “In the event that one spouse is incapacitated or otherwise unable to participate in the administration of the
conjugal properties, the other spouse may assume sole powers of administration. These powers do not
include disposition or encumbrance without 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.”
• The fraud and the intimidation were perpetrated in the execution of the amicable settlement. (Gilda
testified that brgy. authorities made her sign said document through misrepresentation and coercion)
• Thus the amicable settlement couldn’t actually ratify anything. Art 1422 provides that a contract
directly resulting from a previous illegal contract is void. Doctrinally, Void contracts can’t be
ratified.
• The Civil Code supports the decision upon comparison with the Family Code. Art.166, CC provides
that the contract above would be only voidable, but Art 173, CC allows the wife to annul it. On the other
hand, the fraud and intimidation that could vitiate consent was present in the amicable settlement
agreement.
 ABALOS VS MACATANGAY, JR.
G.R. No. 155043 September 30 2004

FACTS:
Spouses Arturo and Esther Abalos are the registered owners of a parcel of land with improvements located at Azucena
St., Makati City. Armed with a SPA issued by Esther, Arthuro’s wife, he
executed a Receipt and Memorandum of Agreement (RMOA) in favor
of Macatangay, binding himself to sell to latter the subject property and not to offer the same to any other party within 30
days from date. Full payment would also be effected as soon as possession of the property shall have been turned over to
Macatangay. Macatangay gave an earnest money amounting to P5,000.00 to be deducted from the purchase price of
P1,300,000.00 in favor of the spouses.

Subsequently, Esther executed a SPA appointing her sister, Bernadette Ramos, to act for and in her behalf relative to
the transfer of the property to the respondent. After, Arturo and Esther had a marital squabble brewing at that time and
Macatangay, to protect his interest, made an annotation in the title of the property. He then sent a letter informing the spouses
of his readiness to pay the full amount of the purchase price. Esther, through her SPA, executed in favor of Macatangay, a
Contract to sell the property to the extent of her conjugal interest for the sum of P650,000 less the sum already
received by her and Arturo. She agreed to surrender the property to Macatangay within 20 days along with the deed of
absolute sale upon full payment, while he promised to pay the balance of the purchase price for P1, 290,000.00 after
being placed in possession of the property.

Macatangay informed them that he was ready to pay and set aside the amount of P 1,290,000.00 as evidence by Citibank
Check No. 278107 as full payment. The couple failed to deliver the property so he sued the spouses.

RTC: Petitioner: Macatangay, Respondent: Abalos

Ruling: RTC dismissed the complaint, because the SPA could not have authorized Arturo to sell the property to Macatangay
as it was falsified.

CA: Ruling: CA reversed the decision, ruling the SPA in favor of Arturo, assuming it was void, cannot affect the transaction
between Esther and Macatangay. On the other hand, the CA considered the RMOA executed by Arturo valid to effect the sale
of his conjugal share in the property.

Dissatisfied with the appellate court’s disposition, Abalos seeks a

reversal of its disposition.

ISSUE:
Whether or not there was a contract of sale between Arturo Abalos and Galicano Macatangay.

RULING:
No. Arturo and Esther appear to have been married before the effectivity of the Family Code. There being no
indication that they have adopted a different property regime, their property relations would automatically be
governed by the regime of conjugal partnership of gains. The subject land which had been admittedly acquired
during the marriage of the spouses forms part of their conjugal partnership.
Under the Civil Code, the husband is the administrator of the conjugal partnership. This right is clearly granted to
him by law. More, the husband is the sole administrator. The wife is not entitled as of right to joint administration.

The husband, even if he is statutorily designated as administrator of the conjugal partnership, cannot validly alienate or
encumber any real property of the conjugal partnership without the wife’s consent. Similarly, the wife cannot dispose of any
property belonging to the conjugal partnership without the conformity of the husband. The law is explicit that the wife cannot
bind the conjugal partnership without the husband’s consent, except in cases provided by law.

More significantly, it has been held that prior to the liquidation of the conjugal partnership, the interest of each spouse in
the conjugal assets is inchoate, a mere expectancy, which constitutes neither a legal nor an equitable estate, and does not
ripen into title until it appears that there are assets in the community as a result of the liquidation and settlement. The
interest of each spouse is limited to the net remainder or “remanente liquido” (haber ganancial) resulting from the
liquidation of the affairs of the partnership after its dissolution. Thus, the right of the husband or wife to one-half of the
conjugal assets does not vest until the dissolution and liquidation of the conjugal partnership, or after dissolution of the
marriage, when it is finally determined that, after settlement of conjugal obligations, there are net assets left which can
be divided between the spouses or their respective heirs.

The Family Code has introduced some changes particularly on the aspect of the administration of the conjugal partnership.
The new law provides that the administration of the conjugal partnership is now a joint undertaking of the husband and the
wife. In the event that one spouse is incapacitated or otherwise unable to participate in the administration of the
conjugal partnership, the other spouse may assume sole powers of administration. However, the power of
administration does not include the power to dispose or encumber property belonging to the conjugal partnership. In all
instances, the present law specifically requires the written consent of the other spouse, or authority of the court for the
disposition or encumbrance of conjugal partnership property without which, the disposition or encumbrance shall be
void.

Inescapably, herein Arturo’s action for specific performance must fail. Even on the supposition that the parties only
disposed of their respective shares in the property, the sale, assuming that it exists, is still void for as previously stated, the
right of the husband or the wife to one-half of the conjugal assets does not vest until the liquidation of the conjugal
partnership. Nemo dat qui non habet. No one can give what he has not.

The subsequent agreement between Esther and Galicano did not ratify the earlier transaction between Arturo and
Galicano. A void contract can never be ratified.