Persons Cases October 5.docx

Persons and Family Relations

THIRD DIVISION G.R. No. 200072, June 20, 2016 PHILIP YU, Petitioner, v. VIVECA LIM YU, Respondent. DECISION PERALTA, J.: Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to reverse and set aside the Decision1 dated September 30, 2011 and Resolution2 dated January 5, 2012 of the Court of Appeals (CA) in CA-G.R. SP No. 111414 which granted the petition for the annulment of the Decision3 dated August 20, 2008 of the Regional Trial Court (RTC), Fourth Judicial Region, Branch 10, Balayan, Batangas.

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petitioner's unjustifiable abandonment bringing with her their children without the knowledge and consent of respondent and her assaulting respondent with a 10-inch knife are those contemplated in pars. 10 and 9 of the same code. Notwithstanding the foregoing Court's findings, the same becomes moot with the declaration of nullity of the marriage of the parties, on the ground of the psychological incapacity of petitioner, Viveca Yu, pursuant to the Decision of Branch 10, RTC of Balayan, Batangas, which attained its finality on October 13, 2008. Since the marriage of the parties was declared a nullity there is, therefore, no legal basis to issue a decree of legal separation to the spouses whose marriage has already been declared of no force and effect.

The factual antecedents are as follows. Petitioner Philip Yu and respondent Viveca Lim Yu were married on November 18, 1984. They had four children and maintained their conjugal home at Room 1603 Horizon Condominium, Meralco Avenue, Pasig, Metro Manila. In 1993, however, Viveca left the conjugal home with their four children and filed a Petition for Legal Separation against Philip before the RTC of Pasig City, Branch 261, for repeated physical violence, grossly abusive conduct against her and the children, sexual infidelity, and attempt on her life. She prayed for permanent custody over the children, support, and the dissolution and distribution of their conjugal partnership valued at approximately P5,000,000.00.4chanrobleslaw Philip denied the accusations against him claiming that it was Viveca who actually attacked him a few times. He narrated that his marriage to Viveca was arranged according to the Chinese tradition and that it was much later when he discovered Viveca's excessively jealous, cynical, and insecure behaviour. He countered that since she abandoned the family home, taking their four children away, she was not entitled to support. She was, likewise, unqualified to become the administrator of their conjugal funds, which had outstanding obligations. Thus, Philip prayed in his Counterclaim for the declaration of nullity of their marriage due to Viveca's psychological incapacity, rendering her incapable of complying with her marital obligations.5chanrobleslaw On April 24, 2007, however, Philip filed a Motion to Withdraw Counterclaim for Declaration of Nullity of Marriage revealing that he no longer had the desire to have his marriage declared void. Despite Viveca's fervent opposition, the Pasig RTC granted the motion.6chanrobleslaw On July 1, 2009, the RTC of Pasig City rendered a Decision7 dismissing the Petition for Legal Separation in the following wise:ChanRoblesVirtualawlibrary From the facts obtaining in this case, the Court finds that the parties are in pari delicto warranting a denial of this petition. Respondent's illicit relationship with Linda Daet and his repeated verbal and physical abuses towards petitioner come within the purview of pars. 8 and 1 of Art. 55 of the Family Code of the Philippines whereas

WHEREFORE, premises considered, this petition should be, as it is hereby DISMISSED, for lack of merit. SO ORDERED.8chanroblesvirtuallawlibrary Claiming to be completely unaware of the proceedings before the RTC of Balayan, Batangas, nullifying her marriage with Philip on the ground of her psychological incapacity, Viveca filed a Petition for Annulment of Judgment9 before the CA seeking to annul the Decision dated August 20, 2008 of said court. According to Viveca, jurisdiction over her person did not properly vest since she was not duly served with Summons. She alleged that she was deprived of her right to due process when Philip fraudulently declared that her address upon which she may be duly summoned was still at their conjugal home, when he clearly knew that she had long left said address for the United States of America. Viveca likewise maintained that had Philip complied with the legal requirements for an effective service of summons by publication, she would have been able to rightly participate in the proceedings before the Batangas court. On September 30, 2011, the CA granted Viveca's petition ruling as follows:ChanRoblesVirtualawlibrary The Petition for Declaration of Nullity of Marriage affecting the personal status of private respondent is in the nature of an action in rem. This is so because the term "personal status" includes family relations, particularly the relations between husband and wife. With this premise in mind, it is beyond cavil that the court a quo was justified in resorting to Summons by publication. Petitioner is a nonresident defendant who left the Philippines with her children way back in 1997 and has now been living in the United States of America. The court a quo validly acquired jurisdiction to hear and decide the case given that as adumbrated, in a proceeding in rem, jurisdiction over the person of the defendant is not a prerequisite to confer jurisdiction on the court, provided that the court acquires jurisdiction over the res. Still and all, there is more to this case than meets the eye. Private respondent knew that petitioner left the conjugal home on account of their marital

Persons and Family Relations

difficulties. She temporarily resided at her parent's house in Greenhills, Mandaluyong, Metro Manila. But during the pendency of the Legal Separation case, she lived in Quezon City. This much was revealed by private respondent himself in the Amended Answer with Counterclaim filed in the Legal Separation suit"10. After abandoning the conjugal abode on 24 August 1993, petitioner resided at her parent's house in Richbelt Condominium, Annapolis Street, Greenhills, Mandaluyong, Metro Manila, until she moved to her present address in October 1993. x x x x This knowledge notwithstanding, private respondent declared before the court a quo that the "last known address" of petitioner was still her conjugal abode at Unit 1603 Horizon Condominium, Mcralco Avenue, Ortigas, Pasig City. While private respondent knew that it was well-nigh impossible for petitioner to receive Summons and other court notices at their former conjugal home, still, he supplied the aforesaid address. We cannot turn a blind eye to the fact that private respondent moved for the dismissal of his counterclaim for nullity of marriage in the Legal Separation case in 2007 as he had by then had the sinister motive of filing the Petition for Declaration of Nullity of Marriage before the court a quo. Private respondent knew that if he breathed a word on the filing and pendency of the latter Petition, petitioner would vigorously resist it as revealed by her tenacious opposition in the proceedings before the RTC-Pasig. The deceitful scheme employed by private respondent deprived petitioner of her constitutional right to due process which ensued in her failure to participate in the proceedings before the court a quo. To Our mind, this compelling justification warrants the annulment of judgement.10chanroblesvirtuallawlibrary In its Resolution dated January 5, 2012, the CA denied Philip's Motion for Reconsideration finding no cogent and persuasive reason to revise or reverse its Decision. Hence, this petition invoking the following grounds:ChanRoblesVirtualawlibrary I. THE COURT OF APPEALS ERRED WHEN IT SET ASIDE THE FINAL AND EXECUTORY DECISION OF THE COURT A QUO DESPITE ITS ACCURATE FINDINGS THAT THE COURT A QUO PROPERLY ACQUIRED JURISDICTION OVER THE ACTION IN REM THROUGH SUMMONS BY PUBLICATION. II. THE PUBLICATION OF THE ORDER OF THE COURT A QUO, SUMMONS, THE COMPLAINT AS WELL AS THE DECISION RENDERED THEREIN IS NOTICE TO THE WHOLE WORLD INCLUDING RESPONDENT. RESPONDENT WAS THEREFORE CONSTRUCTIVELY NOTIFIED OF THE PROCEEDINGS AND WAS NOT DENIED DUE PROCESS HAVING BEEN DULY NOTIFIED BY PUBLICATION. III.

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RESPONDENT HAS BEEN DOMICILED IN THE UNITED STATES OF AMERICA FOR MORE THAN TEN (10) YEARS AND WHOSE ADDRESS IS UNKNOWN TO PETITIONER. AS FAR AS PETITIONER IS CONCERNED, UNIT 1603 HORIZON CONDOMINIUM, MERALCO AVENUE, PASIG CITY IS THE LAST KNOWN ADDRESS OF RESPONDENT, BEING THE CONJUGAL HOME. IV. PETITIONER IS CURRENTLY NOT A RESIDENT OF THE CONJUGAL HOME. V. THE OFFICE OF THE SOLICITOR GENERAL AND/OR THE OFFICE OF THE CITY PROSECUTOR OF BALAYAN, BATANGAS, APPEARED AS COUNSEL FOR THE STATE AND FULLY PROTECTED THE INTEREST OF THE STATE INCLUDING THE INTEREST OF RESPONDENT. VI. PETITIONER CANNOT BE FAULTED FOR MOVING FOR THE WITHDRAWAL OF HIS COUNTER-CLAIM FOR DECLARATION OF NULLITY OF MARRIAGE, WHICH IS ALLOWED BY SECTION 2, RULE 17 OF THE NEW RULES OF COURT AS AMENDED, AND SAID WITHDRAWAL WAS EVEN APPROVED BY THE RTC OF PASIG. VII. THE PETITION FOR ANNULMENT OF DECISION FILED BEFORE THE COURT OF APPEALS WAS DEFECTIVE AND NOT IN ACCORDANCE WITH RULE 47 OF THE NEW RULES OF COURT, AS AMENDED, FOR HAVING FAILED TO STATE AND ALLEGE THE DEFENSES THAT RESPONDENT HAS AGAINST PETITIONER. VIII. EVEN ASSUMING ARGUENDO THAT THE DEFENSES THAT ARE AVAILABLE TO RESPONDENT ARE THOSE THAT WERE PRESENTED IN THE LEGAL SEPARATION CASE THAT WAS DISMISSED BY THE RTC OF PASIG CITY, SAID GROUNDS ONLY BOLSTER THE FACT THAT THE DECISION DATED AUGUST 20, 2008 OF THE RTC OF BALAYAN, BATANGAS, CORRECTLY NULLIFIED THE MARRIAGE DUE TO RESPONDENT'S PSYCHOLOGICAL INCAPACITY. IX. THE COURT OF APPEALS DID NOT OBSERVE AND FOLLOW SECTIONS 6 AND 7 OF RULE 47 OF THE REVISED RULES OF COURT, AS AMENDED. In essence, Philip questions the appellate court's judgment of setting aside the decision of the Batangas RTC despite its own finding that said court validly acquired jurisdiction when Summons was duly served on Viveca by publication. He maintains that since service of summons was properly accomplished by publication thereof in a newspaper of general circulation as well as its personal service on Viveca at her last known address, it logically follows that any and all resolutions rendered by the trial court are valid and binding on the

Persons and Family Relations

parties. Thus, the decision of the Batangas court which acquired jurisdiction over the res should be immutable as it is already final and executory.11chanrobleslaw Philip also questions the appellate court's choice of supporting jurisprudence alleging them to be inapplicable to the instant case. He asserts that the teachings in Spouses Belen v. Judge Chavez,12Biaco v. Philippine Countryside Rural Bank,13 and Ancheta v. Judge Ancheta14 fail to be instructive simply because they involve substituted service of summons whereas the mode of service in this case is by publication. Philip further asserts that said jurisprudential doctrines even teach us that in proceedings in rem or quasi in rem, such as the case at hand, jurisdiction over the defendant is not a prerequisite to confer jurisdiction on the court for as long as the court acquires jurisdiction over the res. Thus, summons must be served upon the defendant not for the purpose of vesting the court with jurisdiction but merely for satisfying the due process requirements, which in this case was duly complied with when Viveca, who is a non-resident, not found in the Philippines, was served with summons by publication.15chanrobleslaw Hence, Philip faults the CA in finding that due to his bad faith in maliciously supplying the Batangas court with an erroneous address wherein Viveca may supposedly be summoned, she was deprived of her constitutional right to due process, warranting the annulment of the subject judgment. According to him, as far as he was concerned, Viveca's last known address was their conjugal home. This is because the addresses supplied in the proceedings of the Legal Separation case before the RTC of Pasig City were merely temporary in nature.16 Philip recalled that when Viveca left their conjugal abode on August 24, 1993, she temporarily stayed at her parents' house in Greenhills, Mandaluyong, for less than two months then, thereafter, stayed at her temporary residence at Domingo Street, Cubao, Quezon City, in October 1993. Considering that said addresses were merely temporary, Philip claims that he should not be faulted for using their conjugal abode as Viveca's "last known address." According to him, what is mandated by the rules as the defendant's "last known address" is his or her last known permanent address, and certainly not one of temporary nature.17chanrobleslaw The petition is bereft of merit. Annulment of judgment is a recourse equitable in character, allowed only in exceptional cases as where there is no available or other adequate remedy. Section 2, Rule 47 of the 1997 Rules of Civil Procedure provides that judgments may be annulled only on grounds of extrinsic fraud and lack of jurisdiction or denial of due process.18 The objective of the remedy of annulment of judgment or final order is to undo or set aside the judgment or final order, and thereby grant to the petitioner an opportunity to prosecute his cause or to ventilate his defense. If the ground relied upon is lack of jurisdiction, the entire proceedings are set aside without prejudice to the original action being refiled in the proper court. If the judgment or final order or resolution is set aside on the ground of extrinsic fraud, the CA may on motion order the trial court to try the case as if a timely motion for new trial had been granted therein.19chanrobleslaw

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Extrinsic fraud exists when there is a fraudulent act committed by the prevailing party outside of the trial of the case, whereby the defeated party was prevented from presenting fully his side of the case by fraud or deception practiced on him by the prevailing party.20 Fraud is extrinsic where the unsuccessful party had been prevented from exhibiting fully his case, by means of fraud or deception, as by keeping him away from court, or by a false promise of a compromise; or where the defendant never had knowledge of the suit, being kept in ignorance by the acts of the plaintiff; or where an attorney fraudulently or without authority assumes to represent a party and connives at his defeat; these and similar cases which show that there has never been a real contest in the trial or hearing of the case are reasons for which a new suit may be sustained to set aside and annul the former judgment and open the case for a new and fair hearing. Ultimately, the overriding consideration is that the fraudulent scheme of the prevailing litigant prevented a party from having his day in court.21chanrobleslaw In the present case, We find that Viveca was completely prevented from participating in the Declaration of Nullity case because of the fraudulent scheme employed by Philip insofar as the service of summons is concerned. Summons is a writ by which the defendant is notified of the action brought against him. Through its service, the court acquires jurisdiction over his person.22 As a rule, Philippine courts cannot try any case against a defendant who does not reside and is not found in the Philippines because of the impossibility of acquiring jurisdiction over his person unless he voluntarily appears in court. Section 15, Rule 14 of the Rules of Court, however, enumerates the actions in rem or quasi in rem when Philippine courts have jurisdiction to hear and decide the case because they have jurisdiction over the res, and jurisdiction over the person of the non-resident defendant is not essential.23 Said section provides:ChanRoblesVirtualawlibrary Section 15. Extraterritorial service. — When the defendant does not reside and is not found in the Philippines, and the action affects the personal status of the plaintiffor relates to, or the subject of which is, property within the Philippines, in which the defendant has or claims a lien or interest, actual or contingent, or in which the relief demanded consists, wholly or in part, in excluding the defendant from any interest therein, or the property of the defendant has been attached within the Philippines, service may, by leave of court, be effected out of the Philippines by personal service as under section 6; or by publication in a newspaper of general circulation in such places and for such time as the court may order, in which case a copy of the summons and order of the court shall be sent by registered mail to the last known address of the defendant, or in any other manner the court may deem sufficient. Any order granting such leave shall specify a reasonable time, which shall not be less than sixty (60) days after notice, within which the defendant must answer. (17a) Thus, under Section 15 of Rule 14, a defendant who is a non-resident and is not found in the country may be served with summons by extraterritorial service in four instances: (1) when the action affects the personal status of the plaintiff; (2) when the action relates

Persons and Family Relations

to, or the subject of which is property within the Philippines, in which the defendant has or claims a lien or interest, actual or contingent; (3) when the relief demanded consists, wholly or in part, in excluding the defendant from any interest in property located in the Philippines; or (4) when the property of the defendant has been attached within the Philippines.24chanrobleslaw In these instances, extraterritorial service of summons may be effected under any of three modes: (1) by personal service out of the country, with leave of court; (2) by publication and sending a copy of the summons and order of the court by registered mail to the defendant's last known address, also with leave of court; or (3) by any other means the judge may consider sufficient.25cralawredchanrobleslaw In the present case, it is undisputed that when Philip filed the Petition for Declaration of Nullity of Marriage, an action which affects his personal status, Viveca was already residing in the United States of America. Thus, extraterritorial service of summons under Section 15, Rule 14 of the Rules of Court is the proper mode by which summons may be served on Viveca, a non-resident defendant who is not found in the Philippines. In compliance therewith, Philip claims that Viveca was duly served summons because: (1) copies of the summons, complaint, and order of the Batangas court were published in Tempo, a newspaper of general circulation on March 27, 2008 and April 3, 2008;26 and (2) the sheriff served copies of the summons, complaint, and order of the Batangas court on Viveca at their conjugal home in Pasig City, her last known address.27 Thus, he contends that the second mode of extraterritorial service of summons mentioned above - by publication and sending a copy of the summons and order of the court by registered mail to the defendant's last known address - was sufficiently complied with. The Court finds, however, that such service of summons on their conjugal home address cannot be deemed compliant with the requirements of the rules and is even tantamount to deception warranting the annulment of the Batangas court's judgment. Philip fervently asserts the propriety of their conjugal home address as Viveca's "last known address," well within the true meaning and intent of the rules. But as borne by the records of the instant case, not only is he mistaken, factual considerations herein belie his claims of good faith. First and foremost, it is undisputed that the parties herein are also parties in a Legal Separation case, previously filed by Viveca way back in 1994. There was, in said case, a disclosure of their basic personal information, which customarily includes their respective local addresses, wherein they may be served with court papers. In fact, as pointed out by the appellate court, Philip knew that Viveca had already left their conjugal home and moved to a different local address for purposes of the pendency of the Legal Separation case, as shown by his stipulation in his Amended Answer with Counterclaim that "after abandoning the conjugal abode on 24 August 1993, petitioner resided at her parent's house in Richbelt Condominium, Annapolis Street, Greenhills, Mandaluyong, Metro Manila, until she moved to her present address in October 1993." Thus, Philip cannot be allowed to feign ignorance to the fact that Viveca had already intentionally abandoned their conjugal abode and that of all the addresses that Viveca resided at, their conjugal

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home in Horizon Condominium is her least recent address. In fact, it may very well be considered as the address she is least likely to be found considering the circumstances in which she left the same. Note that from the very beginning of the Legal Separation case in 1994, all the way up until the promulgation by the Pasig RTC of its decision thereon in 2009, there is no showing that Viveca had ever received any document in relation to said case, nor is there any proof that Philip had ever sent any pertinent file to Viveca, at the conjugal address. There is, therefore, no reason for Philip to assume, in good faith, that said address is in truth and in fact Viveca's "last known address" at which she may receive summons. His contention that the rules require the defendant's "last known address" to be of a permanent, and not of a temporary nature, has no basis in law or jurisprudence. In addition, the Court is curious as to why Philip filed the instant Petition for Declaration of Nullity of Marriage28 before the RTC of Batangas City on February 15, 2008 when less than a year before filing the same, he had motioned the RTC of Pasig City on April 24, 2007 to withdraw his counterclaim for the same declaration of nullity of marriage.29 In his petition before the Court, Philip explained that he withdrew his counterclaim in the Legal Separation case in his "desire to explore the possibility of having a so-called 'universal settlement' of all the pending cases with respondent and her relatives for the sake of his love for his four (4) children."30 Yet, in an apparent, direct contravention of this so-called "desire," he filed an identical action which sought the same nullity of his marriage with Viveca. Thus, while there may be no outright admission on Philip's part as to a sinister motive, his inconsistent actions effectively negate his claims of good faith. It is interesting to note, moreover, that as pointed out by Viveca, Philip does not even reside in Batangas, the city of the court wherein he filed his Petition for Declaration of Nullity of Marriage. In a Certification31issued by Ricardo V. Bautista, Barangay Chairman of Poblacion 1, Calatagan, Batangas, it was categorically stated that "the name Philip Yu is not a resident of Barangay Poblacion 1, Calatagan, Batangas." Section 4 of A.M. No. 0211-10-SC, otherwise known as the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages, which took effect on March 15, 2003, provides:ChanRoblesVirtualawlibrary Section 4. Venue. - The Petition shall be filed in the Family Court of the province or city where the petitioner or the respondent has been residing for at least six months prior to the date of filing. Or in the case of non-resident respondent, where he may be found in the Philippines, at the election of the petitioner.32chanroblesvirtuallawlibrary It is, therefore, evident that not only did Philip contradict his previous Motion to Withdraw his Counterclaim for the Declaration of Nullity of marriage, he even violated a basic mandate of law so as to be able to file the same action before a different court in a city he was not even a resident of. Thus, while individually and in isolation, the aforementioned doubtful circumstances may not instantly amount to extrinsic fraud, these circumstances, when viewed in conjunction with each other, paint a deceitful picture which resulted in a violation of Viveca's

Persons and Family Relations

constitutional right to due process. True, the service of summons in this case is not for the purpose of vesting the court with jurisdiction, but for the purpose of complying with the requirements of fair play or due process. But because of Philip's employment of deceptive means in the service of summons on Viveca, said purpose of satisfying the due process requirements was never accomplished. To this Court, when Philip declared before the Batangas court that Viveca's last known address was still their conjugal home with full and undisputed knowledge that she had already intentionally abandoned the same and had even established a more recent, local residence herein evinces a clear lack of good faith. As a result, Viveca never had knowledge of the filing of the Declaration of Nullity of Marriage suit, only finding out about the same when the Pasig City RTC had promulgated its decision on the Legal Separation case. It is clear, therefore, that because of the service of summons at the erroneous address, Viveca was effectively prevented from participating in the proceedings thereon. In Acance v. Court of Appeals,33 where the extraterritorial service of summons on the nonresident, US citizen, defendants therein were held to be defective due to the absence of proof that the summons, complaint, and order of the court were duly served at their last known correct address, the Court ruled that the failure to strictly comply correctly with the requirements of the rules regarding the mailing of copies of the summons and the order for its publication is a fatal defect in the service of summons.34Citing Dulap, et al. v. Court of Appeals, et al.,35 it elucidated as follows:ChanRoblesVirtualawlibrary It is the duty of the court to require the fullest compliance with all the requirements of the statute permitting service by publication. Where service is obtained by publication, the entire proceeding should be closely scrutinized by the courts and a strict compliance with every condition of law should be exacted. Otherwise great abuses may occur, and the rights of persons and property may be made to depend upon the elastic conscience of interested parties rather than the enlightened judgment of the court or judge.36chanroblesvirtuallawlibrary Indeed, due process requires that those with interest to the thing in litigation be notified and given an opportunity to defend those interests.37 When defendants are deprived of such opportunity to duly participate in, and even be informed of, the proceedings, due to a deceitful scheme employed by the prevailing litigant, as in this case, there exists a violation of their due process rights. Any judgment issued in violation thereof necessarily suffers a fatal infirmity for courts, as guardians of constitutional rights cannot be expected to deny persons their due process rights while at the same time be considered as acting within their jurisdiction.38 This Court, therefore, deems as proper the annulment of the Batangas court's judgment issued without proper service of summons. WHEREFORE, premises considered, the instant petition is DENIED. The assailed Decision dated September 30, 2011 and Resolution dated January 5, 2012 of the Court of Appeals in CA-G.R. SP No. 111414 are AFFIRMED. SO ORDERED

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Persons and Family Relations

Republic of the Philippines Supreme Court Manila SECOND DIVISION BRIGIDO B. QUIAO, Petitioner,

G.R. No 176556 Present: CARPIO, J., Chairperson, BRION, PEREZ, SERENO, and REYES, JJ.

- versus -

RITA C. QUIAO, KITCHIE C. QUIAO, LOTIS C. QUIAO, PETCHIE C. QUIAO, represented by their mother RITA QUIAO, Respondents.

Promulgated: July 4, 2012

x-----------------------------------------------------------------------------------------x DECISION REYES, J.: The family is the basic and the most important institution of society. It is in the family where children are born and molded either to become useful citizens of the country or troublemakers in the community. Thus, we are saddened when parents have to separate and fight over properties, without regard to the message they send to their children.Notwithstanding this, we must not shirk from our obligation to rule on this case involving legal separation escalating to questions on dissolution and partition of properties. The Case This case comes before us via Petition for Review on Certiorari[1] under Rule 45 of the Rules of Court. The petitioner seeks that we vacate and set aside the Order [2]dated January 8, 2007 of the Regional Trial Court (RTC), Branch 1, Butuan City. In lieu of the said order, we are asked to issue a Resolution defining the net profits subject of the forfeiture as a result of the decree of legal separation in accordance with the provision of Article 102(4) of the Family Code, or alternatively, in accordance with the provisions of Article 176 of the Civil Code.

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Antecedent Facts On October 26, 2000, herein respondent Rita C. Quiao (Rita) filed a complaint for legal separation against herein petitioner Brigido B. Quiao (Brigido). [3] Subsequently, the RTC rendered a Decision[4] dated October 10, 2005, the dispositive portion of which provides: WHEREFORE, viewed from the foregoing considerations, judgment is hereby rendered declaring the legal separation of plaintiff Rita C. Quiao and defendant-respondent Brigido B. Quiao pursuant to Article 55. As such, the herein parties shall be entitled to live separately from each other, but the marriage bond shall not be severed. Except for Letecia C. Quiao who is of legal age, the three minor children, namely, Kitchie, Lotis and Petchie, all surnamed Quiao shall remain under the custody of the plaintiff who is the innocent spouse. Further, except for the personal and real properties already foreclosed by the RCBC, all the remaining properties, namely: 1. coffee mill in Balongagan, Las Nieves, Agusan del Norte; 2. coffee mill in Durian, Las Nieves, Agusan del Norte; 3. corn mill in Casiklan, Las Nieves, Agusan del Norte; 4. coffee mill in Esperanza, Agusan del Sur; 5. a parcel of land with an area of 1,200 square meters located in Tungao, Butuan City; 6. a parcel of agricultural land with an area of 5 hectares located in Manila de Bugabos, Butuan City; 7. a parcel of land with an area of 84 square meters located in Tungao, Butuan City; 8. Bashier Bon Factory located in Tungao, Butuan City; shall be divided equally between herein [respondents] and [petitioner] subject to the respective legitimes of the children and the payment of the unpaid conjugal liabilities of [P]45,740.00. [Petitioners] share, however, of the net profits earned by the conjugal partnership is forfeited in favor of the common children. He is further ordered to reimburse [respondents] the sum of [P]19,000.00 as attorney's fees and litigation expenses of [P]5,000.00[.]

Persons and Family Relations

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SO ORDERED.[5] Neither party filed a motion for reconsideration and appeal within the period provided for under Section 17(a) and (b) of the Rule on Legal Separation.[6] On December 12, 2005, the respondents filed a motion for execution[7] which the trial court granted in its Order dated December 16, 2005, the dispositive portion of which reads: Wherefore, finding the motion to be well taken, the same is hereby granted. Let a writ of execution be issued for the immediate enforcement of the Judgment. SO ORDERED.[8] Subsequently, on February 10, 2006, the RTC issued a Writ of Execution [9] which reads as follows: NOW THEREFORE, that of the goods and chattels of the [petitioner] BRIGIDO B. QUIAO you cause to be made the sums stated in the afore-quoted DECISION [sic], together with your lawful fees in the service of this Writ, all in the Philippine Currency.

On July 7, 2006, or after more than nine months from the promulgation of the Decision, the petitioner filed before the RTC a Motion for Clarification, [12] asking the RTC to define the term Net Profits Earned. To resolve the petitioner's Motion for Clarification, the RTC issued an Order[13] dated August 31, 2006, which held that the phrase NET PROFIT EARNED denotes the remainder of the properties of the parties after deducting the separate properties of each [of the] spouse and the debts.[14] The Order further held that after determining the remainder of the properties, it shall be forfeited in favor of the common children because the offending spouse does not have any right to any share of the net profits earned, pursuant to Articles 63, No. (2) and 43, No. (2) of the Family Code. [15] The dispositive portion of the Order states: WHEREFORE, there is no blatant disparity when the sheriff intends to forfeit all the remaining properties after deducting the payments of the debts for only separate properties of the defendant-respondent shall be delivered to him which he has none. The Sheriff is herein directed to proceed with the execution of the Decision. IT IS SO ORDERED.[16]

But if sufficient personal property cannot be found whereof to satisfy this execution and your lawful fees, then we command you that of the lands and buildings of the said [petitioner], you make the said sums in the manner required by law. You are enjoined to strictly observed Section 9, Rule 39, Rule [sic] of the 1997 Rules of Civil Procedure.

Not satisfied with the trial court's Order, the petitioner filed a Motion for Reconsideration[17] on September 8, 2006. Consequently, the RTC issued another Order[18]dated November 8, 2006, holding that although the Decision dated October 10, 2005 has become final and executory, it may still consider the Motion for Clarification because the petitioner simply wanted to clarify the meaning of net profit earned.[19] Furthermore, the same Order held:

You are hereby ordered to make a return of the said proceedings immediately after the judgment has been satisfied in part or in full in consonance with Section 14, Rule 39 of the 1997 Rules of Civil Procedure, as amended.[10]

ALL TOLD, the Court Order dated August 31, 2006 is hereby ordered set aside. NET PROFIT EARNED, which is subject of forfeiture in favor of [the] parties' common children, is ordered to be computed in accordance [with] par. 4 of Article 102 of the Family Code.[20]

On July 6, 2006, the writ was partially executed with the petitioner paying the respondents the amount of P46,870.00, representing the following payments:

On November 21, 2006, the respondents filed a Motion for Reconsideration,[21] praying for the correction and reversal of the Order dated November 8, 2006. Thereafter, on January 8, 2007,[22] the trial court had changed its ruling again and granted the respondents' Motion for Reconsideration whereby the Order dated November 8, 2006 was set aside to reinstate the Order dated August 31, 2006.

(a) P22,870.00 as petitioner's share of the payment of the conjugal share; (b) P19,000.00 as attorney's fees; and (c) P5,000.00 as litigation expenses.[11]

Persons and Family Relations

Not satisfied with the trial court's Order, the petitioner filed on February 27, 2007 this instant Petition for Review under Rule 45 of the Rules of Court, raising the following: Issues

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The Decision dated October 10, 2005 has become final and executory at the time the Motion for Clarification was filed on July 7, 2006.

I Section 3, Rule 41 of the Rules of Court provides: IS THE DISSOLUTION AND THE CONSEQUENT LIQUIDATION OF THE COMMON PROPERTIES OF THE HUSBAND AND WIFE BY VIRTUE OF THE DECREE OF LEGAL SEPARATION GOVERNED BY ARTICLE 125 (SIC) OF THE FAMILY CODE? II

Section 3. Period of ordinary appeal. - The appeal shall be taken within fifteen (15) days from notice of the judgment or final order appealed from. Where a record on appeal is required, the appellant shall file a notice of appeal and a record on appeal within thirty (30) days from notice of the judgment or final order.

WHAT IS THE MEANING OF THE NET PROFITS EARNED BY THE CONJUGAL PARTNERSHIP FOR PURPOSES OF EFFECTING THE FORFEITURE AUTHORIZED UNDER ARTICLE 63 OF THE FAMILY CODE?

The period of appeal shall be interrupted by a timely motion for new trial or reconsideration. No motion for extension of time to file a motion for new trial or reconsideration shall be allowed.

III WHAT LAW GOVERNS THE PROPERTY RELATIONS BETWEEN THE HUSBAND AND WIFE WHO GOT MARRIED IN 1977? CAN THE FAMILY CODE OF THE PHILIPPINES BE GIVEN RETROACTIVE EFFECT FOR PURPOSES OF DETERMINING THE NET PROFITS SUBJECT OF FORFEITURE AS A RESULT OF THE DECREE OF LEGAL SEPARATION WITHOUT IMPAIRING VESTED RIGHTS ALREADY ACQUIRED UNDER THE CIVIL CODE? IV WHAT PROPERTIES SHALL BE INCLUDED IN THE FORFEITURE OF THE SHARE OF THE GUILTY SPOUSE IN THE NET CONJUGAL PARTNERSHIP AS A RESULT OF THE ISSUANCE OF THE DECREE OF LEGAL SEPARATION?[23] Our Ruling While the petitioner has raised a number of issues on the applicability of certain laws, we are well-aware that the respondents have called our attention to the fact that the Decision dated October 10, 2005 has attained finality when the Motion for Clarification was filed.[24] Thus, we are constrained to resolve first the issue of the finality of the Decision dated October 10, 2005 and subsequently discuss the matters that we can clarify.

In Neypes v. Court of Appeals,[25] we clarified that to standardize the appeal periods provided in the Rules and to afford litigants fair opportunity to appeal their cases, we held that it would be practical to allow a fresh period of 15 days within which to file the notice of appeal in the RTC, counted from receipt of the order dismissing a motion for a new trial or motion for reconsideration.[26] In Neypes, we explained that the "fresh period rule" shall also apply to Rule 40 governing appeals from the Municipal Trial Courts to the RTCs; Rule 42 on petitions for review from the RTCs to the Court of Appeals (CA); Rule 43 on appeals from quasi-judicial agencies to the CA and Rule 45 governing appeals by certiorari to the Supreme Court. We also said, The new rule aims to regiment or make the appeal period uniform, to be counted from receipt of the order denying the motion for new trial, motion for reconsideration (whether full or partial) or any final order or resolution. [27] In other words, a party litigant may file his notice of appeal within a fresh 15-day period from his receipt of the trial court's decision or final order denying his motion for new trial or motion for reconsideration. Failure to avail of the fresh 15-day period from the denial of the motion for reconsideration makes the decision or final order in question final and executory. In the case at bar, the trial court rendered its Decision on October 10, 2005. The petitioner neither filed a motion for reconsideration nor a notice of appeal. On December 16, 2005, or after 67 days had lapsed, the trial court issued an order granting the respondent's motion for execution; and on February 10, 2006, or after 123 days had lapsed, the trial court issued a writ of execution. Finally, when the writ had already been partially executed, the petitioner, on July 7, 2006 or after 270 days had lapsed, filed his Motion for Clarification on the definition of the net profits earned. From the foregoing, the

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petitioner had clearly slept on his right to question the RTCs Decision dated October 10, 2005. For 270 days, the petitioner never raised a single issue until the decision had already been partially executed. Thus at the time the petitioner filed his motion for clarification, the trial courts decision has become final and executory. A judgment becomes final and executory when the reglementary period to appeal lapses and no appeal is perfected within such period. Consequently, no court, not even this Court, can arrogate unto itself appellate jurisdiction to review a case or modify a judgment that became final.[28]

fact, we have ruled that for [as] long as the public respondent acted with jurisdiction, any error committed by him or it in the exercise thereof will amount to nothing more than an error of judgment which may be reviewed or corrected only by appeal.[37] Granting without admitting that the RTC's judgment dated October 10, 2005 was erroneous, the petitioner's remedy should be an appeal filed within the reglementary period. Unfortunately, the petitioner failed to do this. He has already lost the chance to question the trial court's decision, which has become immutable and unalterable. What we can only do is to clarify the very question raised below and nothing more.

The petitioner argues that the decision he is questioning is a void judgment. Being such, the petitioner's thesis is that it can still be disturbed even after 270 days had lapsed from the issuance of the decision to the filing of the motion for clarification. He said that a void judgment is no judgment at all. It never attains finality and cannot be a source of any right nor any obligation.[29] But what precisely is a void judgment in our jurisdiction? When does a judgment becomes void?

For our convenience, the following matters cannot anymore be disturbed since the October 10, 2005 judgment has already become immutable and unalterable, to wit: (a) The finding that the petitioner is the offending spouse since he cohabited with a woman who is not his wife;[38] (b) The trial court's grant of the petition for legal separation of respondent Rita;[39]

A judgment is null and void when the court which rendered it had no power to grant the relief or no jurisdiction over the subject matter or over the parties or both. [30] In other words, a court, which does not have the power to decide a case or that has no jurisdiction over the subject matter or the parties, will issue a void judgment or a coram non judice.[31] The questioned judgment does not fall within the purview of a void judgment. For sure, the trial court has jurisdiction over a case involving legal separation. Republic Act (R.A.) No. 8369 confers upon an RTC, designated as the Family Court of a city, the exclusive original jurisdiction to hear and decide, among others, complaints or petitions relating to marital status and property relations of the husband and wife or those living together.[32] The Rule on Legal Separation[33] provides that the petition [for legal separation] shall be filed in the Family Court of the province or city where the petitioner or the respondent has been residing for at least six months prior to the date of filing or in the case of a non-resident respondent, where he may be found in the Philippines, at the election of the petitioner.[34] In the instant case, herein respondent Rita is found to reside in Tungao, Butuan City for more than six months prior to the date of filing of the petition; thus, the RTC, clearly has jurisdiction over the respondent's petition below.Furthermore, the RTC also acquired jurisdiction over the persons of both parties, considering that summons and a copy of the complaint with its annexes were served upon the herein petitioner on December 14, 2000 and that the herein petitioner filed his Answer to the Complaint on January 9, 2001.[35] Thus, without doubt, the RTC, which has rendered the questioned judgment, has jurisdiction over the complaint and the persons of the parties. From the aforecited facts, the questioned October 10, 2005 judgment of the trial court is clearly not void ab initio, since it was rendered within the ambit of the court's jurisdiction. Being such, the same cannot anymore be disturbed, even if the modification is meant to correct what may be considered an erroneous conclusion of fact or law. [36]In

(c) The dissolution and liquidation of the conjugal partnership;[40] (d) The forfeiture of the petitioner's right to any share of the net profits earned by the conjugal partnership;[41] (e) The award to the innocent spouse of the minor children's custody;[42] (f) The disqualification of the offending spouse from inheriting from the innocent spouse by intestate succession;[43] (g) The revocation of provisions in favor of the offending spouse made in the will of the innocent spouse;[44] (h) The holding that the property relation of the parties is conjugal partnership of gains and pursuant to Article 116 of the Family Code, all properties acquired during the marriage, whether acquired by one or both spouses, is presumed to be conjugal unless the contrary is proved;[45] (i) The finding that the spouses acquired their real and personal properties while they were living together;[46] (j) The list of properties which Rizal Commercial Banking Corporation (RCBC) foreclosed;[47] (k) The list of the remaining properties of the couple which must be dissolved and liquidated and the fact that respondent Rita was the one who took charge of the administration of these properties;[48]

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(l) The holding that the conjugal partnership shall be liable to matters included under Article 121 of the Family Code and the conjugal liabilities totaling P503,862.10 shall be charged to the income generated by these properties;[49] (m) The fact that the trial court had no way of knowing whether the petitioner had separate properties which can satisfy his share for the support of the family;[50] (n) The holding that the applicable law in this case is Article 129(7);[51] (o) The ruling that the remaining properties not subject to any encumbrance shall therefore be divided equally between the petitioner and the respondent without prejudice to the children's legitime;[52] (p) The holding that the petitioner's share of the net profits earned by the conjugal partnership is forfeited in favor of the common children;[53] and (q) The order to the petitioner to reimburse the respondents the sum of P19,000.00 as attorney's fees and litigation expenses of P5,000.00.[54]

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settlement, the property relations between the petitioner and the respondent is the system of relative community or conjugal partnership of gains.[55] Article 119 of the Civil Code provides: Art. 119. The future spouses may in the marriage settlements agree upon absolute or relative community of property, or upon complete separation of property, or upon any other regime.In the absence of marriage settlements, or when the same are void, the system of relative community or conjugal partnership of gains as established in this Code, shall govern the property relations between husband and wife. Thus, from the foregoing facts and law, it is clear that what governs the property relations of the petitioner and of the respondent is conjugal partnership of gains. And under this property relation, the husband and the wife place in a common fund the fruits of their separate property and the income from their work or industry.[56] The husband and wife also own in common all the property of the conjugal partnership of gains.[57]

After discussing lengthily the immutability of the Decision dated October 10, 2005, we will discuss the following issues for the enlightenment of the parties and the public at large.

Second, since at the time of the dissolution of the petitioner and the respondent's marriage the operative law is already the Family Code, the same applies in the instant case and the applicable law in so far as the liquidation of the conjugal partnership assets and liabilities is concerned is Article 129 of the Family Code in relation to Article 63(2) of the Family Code. The latter provision is applicable because according to Article 256 of the Family Code [t]his Code shall have retroactive effect insofar as it does not prejudice or impair vested or acquired rights in accordance with the Civil Code or other law.[58]

Article 129 of the Family Code applies to the present case since the parties' property relation is governed by the system of relative community or conjugal partnership of gains.

Now, the petitioner asks: Was his vested right over half of the common properties of the conjugal partnership violated when the trial court forfeited them in favor of his children pursuant to Articles 63(2) and 129 of the Family Code? We respond in the negative.

The petitioner claims that the court a quo is wrong when it applied Article 129 of the Family Code, instead of Article 102. He confusingly argues that Article 102 applies because there is no other provision under the Family Code which defines net profits earned subject of forfeiture as a result of legal separation. Offhand, the trial court's Decision dated October 10, 2005 held that Article 129(7) of the Family Code applies in this case. We agree with the trial court's holding. First, let us determine what governs the couple's property relation. From the record, we can deduce that the petitioner and the respondent tied the marital knot on January 6, 1977. Since at the time of the exchange of marital vows, the operative law was the Civil Code of the Philippines (R.A. No. 386) and since they did not agree on a marriage

Indeed, the petitioner claims that his vested rights have been impaired, arguing: As earlier adverted to, the petitioner acquired vested rights over half of the conjugal properties, the same being owned in common by the spouses. If the provisions of the Family Code are to be given retroactive application to the point of authorizing the forfeiture of the petitioner's share in the net remainder of the conjugal partnership properties, the same impairs his rights acquired prior to the effectivity of the Family Code.[59] In other words, the petitioner is saying that since the property relations between the spouses is governed by the regime of Conjugal Partnership of Gains under the Civil Code, the petitioner acquired vested rights over half of the properties of the Conjugal Partnership of Gains, pursuant to Article 143 of the Civil Code, which provides: All property of the conjugal partnership of gains is owned in common by the husband and wife.[60] Thus, since he is one of the owners of the properties covered by the conjugal

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partnership of gains, he has a vested right over half of the said properties, even after the promulgation of the Family Code; and he insisted that no provision under the Family Code may deprive him of this vested right by virtue of Article 256 of the Family Code which prohibits retroactive application of the Family Code when it will prejudice a person's vested right. However, the petitioner's claim of vested right is not one which is written on stone. In Go, Jr. v. Court of Appeals,[61] we define and explained vested right in the following manner: A vested right is one whose existence, effectivity and extent do not depend upon events foreign to the will of the holder, or to the exercise of which no obstacle exists, and which is immediate and perfect in itself and not dependent upon a contingency. The term vested right expresses the concept of present fixed interest which, in right reason and natural justice, should be protected against arbitrary State action, or an innately just and imperative right which enlightened free society, sensitive to inherent and irrefragable individual rights, cannot deny.

properties be awarded to her.[65] In fact, in his Answer, the petitioner prayed that the trial court divide the community assets between the petitioner and the respondent as circumstances and evidence warrant after the accounting and inventory of all the community properties of the parties.[66] Second, when the Decision dated October 10, 2005 was promulgated, the petitioner never questioned the trial court's ruling forfeiting what the trial court termed as net profits, pursuant to Article 129(7) of the Family Code.[67] Thus, the petitioner cannot claim being deprived of his right to due process. Furthermore, we take note that the alleged deprivation of the petitioner's vested right is one founded, not only in the provisions of the Family Code, but in Article 176 of the Civil Code. This provision is like Articles 63 and 129 of the Family Code on the forfeiture of the guilty spouse's share in the conjugal partnership profits. The said provision says: Art. 176. In case of legal separation, the guilty spouse shall forfeit his or her share of the conjugal partnership profits, which shall be awarded to the children of both, and the children of the guilty spouse had by a prior marriage. However, if the conjugal partnership property came mostly or entirely from the work or industry, or from the wages and salaries, or from the fruits of the separate property of the guilty spouse, this forfeiture shall not apply.

To be vested, a right must have become a titlelegal or equitableto the present or future enjoyment of property.[62] (Citations omitted)

In case there are no children, the innocent spouse shall be entitled to all the net profits.

In our en banc Resolution dated October 18, 2005 for ABAKADA Guro Party List Officer Samson S. Alcantara, et al. v. The Hon. Executive Secretary Eduardo R. Ermita,[63] we also explained: The concept of vested right is a consequence of the constitutional guaranty of due process that expresses a present fixed interest which in right reason and natural justice is protected against arbitrary state action; it includes not only legal or equitable title to the enforcement of a demand but also exemptions from new obligations created after the right has become vested.Rights are considered vested when the right to enjoyment is a present interest, absolute, unconditional, and perfect or fixed and irrefutable.[64] (Emphasis and underscoring supplied) From the foregoing, it is clear that while one may not be deprived of his vested right, he may lose the same if there is due process and such deprivation is founded in law and jurisprudence. In the present case, the petitioner was accorded his right to due process. First, he was well-aware that the respondent prayed in her complaint that all of the conjugal

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From the foregoing, the petitioner's claim of a vested right has no basis considering that even under Article 176 of the Civil Code, his share of the conjugal partnership profits may be forfeited if he is the guilty party in a legal separation case. Thus, after trial and after the petitioner was given the chance to present his evidence, the petitioner's vested right claim may in fact be set aside under the Civil Code since the trial court found him the guilty party. More, in Abalos v. Dr. Macatangay, Jr.,[68] we reiterated our long-standing ruling that: [P]rior 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

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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.[69] (Citations omitted) Finally, as earlier discussed, the trial court has already decided in its Decision dated October 10, 2005 that the applicable law in this case is Article 129(7) of the Family Code.[70] The petitioner did not file a motion for reconsideration nor a notice of appeal. Thus, the petitioner is now precluded from questioning the trial court's decision since it has become final and executory. The doctrine of immutability and unalterability of a final judgment prevents us from disturbing the Decision dated October 10, 2005 because final and executory decisions can no longer be reviewed nor reversed by this Court.[71] From the above discussions, Article 129 of the Family Code clearly applies to the present case since the parties' property relation is governed by the system of relative community or conjugal partnership of gains and since the trial court's Decision has attained finality and immutability. The net profits of the conjugal partnership of gains are all the fruits of the separate properties of the spouses and the products of their labor and industry. The petitioner inquires from us the meaning of net profits earned by the conjugal partnership for purposes of effecting the forfeiture authorized under Article 63 of the Family Code. He insists that since there is no other provision under the Family Code, which defines net profits earned subject of forfeiture as a result of legal separation, then Article 102 of the Family Code applies. What does Article 102 of the Family Code say? Is the computation of net profits earned in the conjugal partnership of gains the same with the computation of net profits earned in the absolute community? Now, we clarify. First and foremost, we must distinguish between the applicable law as to the property relations between the parties and the applicable law as to the definition of net profits. As earlier discussed, Article 129 of the Family Code applies as to the property relations of the parties. In other words, the computation and the succession of events will follow the provisions under Article 129 of the said Code. Moreover, as to the definition of

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net profits, we cannot but refer to Article 102(4) of the Family Code, since it expressly provides that for purposes of computing the net profits subject to forfeiture under Article 43, No. (2) and Article 63, No. (2), Article 102(4) applies. In this provision, net profits shall be the increase in value between the market value of the community property at the time of the celebration of the marriage and the market value at the time of its dissolution.[72] Thus, without any iota of doubt, Article 102(4) applies to both the dissolution of the absolute community regime under Article 102 of the Family Code, and to the dissolution of the conjugal partnership regime under Article 129 of the Family Code. Where lies the difference? As earlier shown, the difference lies in the processes used under the dissolution of the absolute community regime under Article 102 of the Family Code, and in the processes used under the dissolution of the conjugal partnership regime under Article 129 of the Family Code. Let us now discuss the difference in the processes between the absolute community regime and the conjugal partnership regime. On Absolute Community Regime: When a couple enters into a regime of absolute community, the husband and the wife becomes joint owners of all the properties of the marriage. Whatever property each spouse brings into the marriage, and those acquired during the marriage (except those excluded under Article 92 of the Family Code) form the common mass of the couple's properties. And when the couple's marriage or community is dissolved, that common mass is divided between the spouses, or their respective heirs, equally or in the proportion the parties have established, irrespective of the value each one may have originally owned.[73] Under Article 102 of the Family Code, upon dissolution of marriage, an inventory is prepared, listing separately all the properties of the absolute community and the exclusive properties of each; then the debts and obligations of the absolute community are paid out of the absolute community's assets and if the community's properties are insufficient, the separate properties of each of the couple will be solidarily liable for the unpaid balance. Whatever is left of the separate properties will be delivered to each of them. The net remainder of the absolute community is its net assets, which shall be divided between the husband and the wife; and for purposes of computing the net profits subject to forfeiture, said profits shall be the increase in value between the market value of the community property at the time of the celebration of the marriage and the market value at the time of its dissolution.[74] Applying Article 102 of the Family Code, the net profits requires that we first find the market value of the properties at the time of the community's dissolution. From the totality of the market value of all the properties, we subtract the debts and obligations of the absolute community and this result to the net assets or net remainder of the

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properties of the absolute community, from which we deduct the market value of the properties at the time of marriage, which then results to the net profits.[75] Granting without admitting that Article 102 applies to the instant case, let us see what will happen if we apply Article 102: (a) According to the trial court's finding of facts, both husband and wife have no separate properties, thus, the remaining properties in the list above are all part of the absolute community. And its market value at the time of the dissolution of the absolute community constitutes the market value at dissolution. (b) Thus, when the petitioner and the respondent finally were legally separated, all the properties which remained will be liable for the debts and obligations of the community. Such debts and obligations will be subtracted from the market value at dissolution. (c) What remains after the debts and obligations have been paid from the total assets of the absolute community constitutes the net remainder or net asset. And from such net asset/remainder of the petitioner and respondent's remaining properties, the market value at the time of marriage will be subtracted and the resulting totality constitutes the net profits. (d) Since both husband and wife have no separate properties, and nothing would be returned to each of them, what will be divided equally between them is simply the net profits. However, in the Decision dated October 10, 2005, the trial court forfeited the half-share of the petitioner in favor of his children. Thus, if we use Article 102 in the instant case (which should not be the case), nothing is left to the petitioner since both parties entered into their marriage without bringing with them any property. On Conjugal Partnership Regime: Before we go into our disquisition on the Conjugal Partnership Regime, we make it clear that Article 102(4) of the Family Code applies in the instant case for purposes only of defining net profit. As earlier explained, the definition of net profits in Article 102(4) of the Family Code applies to both the absolute community regime and conjugal partnership regime as provided for under Article 63, No. (2) of the Family Code, relative to the provisions on Legal Separation. Now, when a couple enters into a regime of conjugal partnership of gains under Article 142 of the Civil Code, the husband and the wife place in common fund the fruits of their separate property and income from their work or industry, and divide equally, upon the dissolution of the marriage or of the partnership, the net gains or benefits obtained indiscriminately by either spouse during the marriage.[76] From the foregoing provision, each of the couple has his and her own property and debts. The law does not intend to effect a mixture or merger of those debts or properties between the spouses. Rather, it establishes a complete separation of capitals.[77]

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Considering that the couple's marriage has been dissolved under the Family Code, Article 129 of the same Code applies in the liquidation of the couple's properties in the event that the conjugal partnership of gains is dissolved, to wit: Art. 129. Upon the dissolution of the conjugal partnership regime, the following procedure shall apply: (1) An inventory shall be prepared, listing separately all the properties of the conjugal partnership and the exclusive properties of each spouse. (2) Amounts advanced by the conjugal partnership in payment of personal debts and obligations of either spouse shall be credited to the conjugal partnership as an asset thereof. (3) Each spouse shall be reimbursed for the use of his or her exclusive funds in the acquisition of property or for the value of his or her exclusive property, the ownership of which has been vested by law in the conjugal partnership. (4) The debts and obligations of the conjugal partnership shall be paid out of the conjugal assets. In case of insufficiency of said assets, the spouses shall be solidarily liable for the unpaid balance with their separate properties, in accordance with the provisions of paragraph (2) of Article 121. (5) Whatever remains of the exclusive properties of the spouses shall thereafter be delivered to each of them. (6) Unless the owner had been indemnified from whatever source, the loss or deterioration of movables used for the benefit of the family, belonging to either spouse, even due to fortuitous event, shall be paid to said spouse from the conjugal funds, if any. (7) The net remainder of the conjugal partnership properties shall constitute the profits, which shall be divided equally between husband and wife, unless a different proportion or division was agreed upon in the marriage settlements or unless there has been a voluntary waiver or forfeiture of such share as provided in this Code. (8) The presumptive legitimes of the common children shall be delivered upon the partition in accordance with Article 51.

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(9) In the partition of the properties, the conjugal dwelling and the lot on which it is situated shall, unless otherwise agreed upon by the parties, be adjudicated to the spouse with whom the majority of the common children choose to remain. Children below the age of seven years are deemed to have chosen the mother, unless the court has decided otherwise. In case there is no such majority, the court shall decide, taking into consideration the best interests of said children. In the normal course of events, the following are the steps in the liquidation of the properties of the spouses: (a) An inventory of all the actual properties shall be made, separately listing the couple's conjugal properties and their separate properties.[78] In the instant case, the trial court found that the couple has no separate properties when they married.[79] Rather, the trial court identified the following conjugal properties, to wit: 1. coffee mill in Balongagan, Las Nieves, Agusan del Norte; 2. coffee mill in Durian, Las Nieves, Agusan del Norte; 3. corn mill in Casiklan, Las Nieves, Agusan del Norte;

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(c) Subsequently, the couple's conjugal partnership shall pay the debts of the conjugal partnership; while the debts and obligation of each of the spouses shall be paid from their respective separate properties. But if the conjugal partnership is not sufficient to pay all its debts and obligations, the spouses with their separate properties shall be solidarily liable.[83] (d) Now, what remains of the separate or exclusive properties of the husband and of the wife shall be returned to each of them.[84] In the instant case, since it was already established by the trial court that the spouses have no separate properties,[85] there is nothing to return to any of them. The listed properties above are considered part of the conjugal partnership. Thus, ordinarily, what remains in the above-listed properties should be divided equally between the spouses and/or their respective heirs.[86] However, since the trial court found the petitioner the guilty party, his share from the net profits of the conjugal partnership is forfeited in favor of the common children, pursuant to Article 63(2) of the Family Code. Again, lest we be confused, like in the absolute community regime, nothing will be returned to the guilty party in the conjugal partnership regime, because there is no separate property which may be accounted for in the guilty party's favor. In the discussions above, we have seen that in both instances, the petitioner is not entitled to any property at all. Thus, we cannot but uphold the Decision dated October 10, 2005 of the trial court. However, we must clarify, as we already did above, the Order dated January 8, 2007.

4. coffee mill in Esperanza, Agusan del Sur; 5. a parcel of land with an area of 1,200 square meters located in Tungao, Butuan City; 6. a parcel of agricultural land with an area of 5 hectares located in Manila de Bugabos, Butuan City;

WHEREFORE, the Decision dated October 10, 2005 of the Regional Trial Court, Branch 1 of Butuan City is AFFIRMED. Acting on the Motion for Clarification dated July 7, 2006 in the Regional Trial Court, the Order dated January 8, 2007 of the Regional Trial Court is hereby CLARIFIED in accordance with the above discussions. SO ORDERED.

7. a parcel of land with an area of 84 square meters located in Tungao, Butuan City; 8. Bashier Bon Factory located in Tungao, Butuan City.[80] (b) Ordinarily, the benefit received by a spouse from the conjugal partnership during the marriage is returned in equal amount to the assets of the conjugal partnership;[81]and if the community is enriched at the expense of the separate properties of either spouse, a restitution of the value of such properties to their respective owners shall be made.[82]

BIENVENIDO L. REYES Associate Justice WE CONCUR:

ANTONIO T. CARPIO Senior Associate Justice

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Chairperson, Second Division

ARTURO D. BRION Associate Justice

JOSE PORTUGAL PEREZ Associate Justice

MARIA LOURDES P. A. SERENO Associate Justice CERTIFICATION I certify 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 Courts Division.

ANTONIO T. CARPIO Senior Associate Justice (Per Section 12, R.A. 296 The Judiciary Act of 1948, as amended) Republic of the Philippines SUPREME COURT Manila THIRD DIVISION

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G.R. No. 179620 August 26, 2008 MANUEL G. ALMELOR, petitioner, vs. THE HON. REGIONAL TRIAL COURT OF LAS PIÑAS CITY, BRANCH 254, and LEONIDA T. ALMELOR, respondents. DECISION REYES, R.T., J.: MARRIAGE, in its totality, involves the spouses' right to the community of their whole lives. It likewise involves a true intertwining of personalities.1 This is a petition for review on certiorari of the Decision2 of the Court of Appeals (CA) denying the petition for annulment of judgment and affirming in toto the decision of the Regional Trial Court (RTC), Las Piñas, Branch 254. The CA dismissed outright the Rule 47 petition for being the wrong remedy. The Facts Petitioner Manuel G. Almelor (Manuel) and respondent Leonida Trinidad (Leonida) were married on January 29, 1989 at the Manila Cathedral.3 Their union bore three children: (1) Maria Paulina Corinne, born on October 20, 1989; (2) Napoleon Manuel, born on August 9, 1991; and (3) Manuel Homer, born on July 4, 1994.4 Manuel and Leonida are both medical practitioners, an anesthesiologist and a pediatrician, respectively.5 After eleven (11) years of marriage, Leonida filed a petition with the RTC in Las Piñas City to annul their marriage on the ground that Manuel was psychologically incapacitated to perform his marital obligations. The case, docketed as LP-00-0132 was raffled off to Branch 254. During the trial, Leonida testified that she first met Manuel in 1981 at the San Lazaro Hospital where they worked as medical student clerks. At that time, she regarded Manuel as a very thoughtful person who got along well with other people. They soon became sweethearts. Three years after, they got married.6 Leonida averred that Manuel's kind and gentle demeanor did not last long. In the public eye, Manuel was the picture of a perfect husband and father. This was not the case in his private life. At home, Leonida described Manuel as a harsh disciplinarian, unreasonably meticulous, easily angered. Manuel's unreasonable way of imposing discipline on their children was the cause of their frequent fights as a couple.7 Leonida complained that this was in stark contrast to the alleged lavish affection Manuel has for his mother. Manuel's deep attachment to his mother and his dependence on her decision-making were incomprehensible to Leonida.8 Further adding to her woes was his concealment to her of his homosexuality. Her suspicions were first aroused when she noticed Manuel's peculiar closeness to his male companions. For instance, she caught him in an indiscreet telephone conversation manifesting his affection for a male caller.9 She also found several pornographic homosexual materials in his possession.10 Her worse fears were confirmed when she saw Manuel kissed another man on the lips. The man was a certain Dr. Nogales.11 When she confronted Manuel, he denied everything. At this point, Leonida took her children and left their conjugal abode. Since then, Manuel stopped giving support to their children. 12

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Dr. Valentina del Fonso Garcia, a clinical psychologist, was presented to prove Leonida's claim. Dr. del Fonso Garcia testified that she conducted evaluative interviews and a battery of psychiatric tests on Leonida. She also had a one-time interview with Manuel and face-to-face interviews with Ma. Paulina Corrinne (the eldest child).13 She concluded that Manuel is psychologically incapacitated.14 Such incapacity is marked by antecedence; it existed even before the marriage and appeared to be incurable. Manuel, for his part, admitted that he and Leonida had some petty arguments here and there. He, however, maintained that their marital relationship was generally harmonious. The petition for annulment filed by Leonida came as a surprise to him. Manuel countered that the true cause of Leonida's hostility against him was their professional rivalry. It began when he refused to heed the memorandum15 released by Christ the King Hospital. The memorandum ordered him to desist from converting his own lying-in clinic to a primary or secondary hospital.16 Leonida's family owns Christ the King Hospital which is situated in the same subdivision as Manuel's clinic and residence.17 In other words, he and her family have competing or rival hospitals in the same vicinity. Manuel belied her allegation that he was a cruel father to their children. He denied maltreating them. At most, he only imposed the necessary discipline on the children. He also defended his show of affection for his mother. He said there was nothing wrong for him to return the love and affection of the person who reared and looked after him and his siblings. This is especially apt now that his mother is in her twilight years.18 Manuel pointed out that Leonida found fault in this otherwise healthy relationship because of her very jealous and possessive nature.19 This same overly jealous behavior of Leonida drove Manuel to avoid the company of female friends. He wanted to avoid any further misunderstanding with his wife. But, Leonida instead conjured up stories about his sexual preference. She also fabricated tales about pornographic materials found in his possession to cast doubt on his masculinity.20 To corroborate his version, he presented his brother, Jesus G. Almelor. Jesus narrated that he usually stayed at Manuel's house during his weekly trips to Manila from Iriga City. He was a witness to the generally harmonious relationship between his brother Manuel and sister-in-law, Leonida. True, they had some quarrels typical of a husband and wife relationship. But there was nothing similar to what Leonida described in her testimony.21 Jesus further testified that he was with his brother on the day Leonida allegedly saw Manuel kissed another man. He denied that such an incident occurred. On that particular date,22 he and Manuel went straight home from a trip to Bicol. There was no other person with them at that time, except their driver.23 Manuel expressed his intention to refute Dr. del Fonso Garcia's findings by presenting his own expert witness. However, no psychiatrist was presented. RTC Disposition By decision dated November 25, 2005, the RTC granted the petition for annulment, with the following disposition: WHEREFORE, premised on the foregoing, judgment is hereby rendered: 1. Declaring the marriage contracted by herein parties on 29 January 1989 and all its effects under the law null and void from the beginning;

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2. Dissolving the regime of community property between the same parties with forfeiture of defendant's share thereon in favor of the same parties' children whose legal custody is awarded to plaintiff with visitorial right afforded to defendant; 3. Ordering the defendant to give monthly financial support to all the children; and 4. Pursuant to the provisions of A.M. No. 02-11-10-SC: a. Directing the Branch Clerk of this Court to enter this Judgment upon its finality in the Book of Entry of Judgment and to issue an Entry of Judgment in accordance thereto; and b. Directing the Local Civil Registrars of Las Piñas City and Manila City to cause the registration of the said Entry of Judgment in their respective Books of Marriages. Upon compliance, a decree of nullity of marriage shall be issued. SO ORDERED.24 (Emphasis supplied) The trial court nullified the marriage, not on the ground of Article 36, but Article 45 of the Family Code. It ratiocinated: x x x a careful evaluation and in-depth analysis of the surrounding circumstances of the allegations in the complaint and of the evidence presented in support thereof (sic) reveals that in this case (sic) there is more than meets the eyes (sic). Both legally and biologically, homosexuality x x x is, indeed, generally incompatible with hetero sexual marriage. This is reason enough that in this jurisdiction (sic) the law recognizes marriage as a special contract exclusively only between a man and a woman x x x and thus when homosexuality has trespassed into marriage, the same law provides ample remedies to correct the situation [Article 45(3) in relation to Article 46(4) or Article 55, par. 6, Family Code]. This is of course in recognition of the biological fact that no matter how a man cheats himself that he is not a homosexual and forces himself to live a normal heterosexual life, there will surely come a time when his true sexual preference as a homosexual shall prevail in haunting him and thus jeopardizing the solidity, honor, and welfare of his own family.25 Manuel filed a notice of appeal which was, however, denied due course. Undaunted, he filed a petition for annulment of judgment with the CA.26 Manuel contended that the assailed decision was issued in excess of the lower court's jurisdiction; that it had no jurisdiction to dissolve the absolute community of property and forfeit his conjugal share in favor of his children. CA Disposition On July 31, 2007, the CA denied the petition, disposing as follows: WHEREFORE, the present Petition for Annulment of Judgment is hereby DENIED. The Court AFFIRMS in toto the Decision (dated November 25, 2005) of the Regional Trial Court (Branch 254), in Las Piñas City, in Civil Case No. LP-00-0132. No costs.27 The CA stated that petitioner pursued the wrong remedy by filing the extraordinary remedy of petition for annulment of judgment. Said the appellate court: It is obvious that the petitioner is questioning the propriety of the decision rendered by the lower Court. But the remedy assuming there was a mistake is not

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a Petition for Annulment of Judgment but an ordinary appeal. An error of judgment may be reversed or corrected only by appeal. What petitioner is ascribing is an error of judgment, not of jurisdiction, which is properly the subject of an ordinary appeal. In short, petitioner admits the jurisdiction of the lower court but he claims excess in the exercise thereof. "Excess" assuming there was is not covered by Rule 47 of the 1997 Rules of Civil Procedure. The Rule refers the lack of jurisdiction and not the exercise thereof.28 Issues Petitioner Manuel takes the present recourse via Rule 45, assigning to the CA the following errors: I THE HONORABLE COURT OF APPEALS ERRED IN NOT TREATING THE PETITION FOR ANNULMENT OF JUDGMENT AS A PETITION FOR REVIEW IN VIEW OF THE IMPORTANCE OF THE ISSUES INVOLVED AND IN THE INTEREST OF JUSTICE; II THE HONORABLE COURT OF APPEALS ERRED IN UPHOLDING THE DECISION OF THE TRIAL COURT AS REGARDS THE ORDER DECLARING THE MARRIAGE AS NULL AND VOID ON THE GROUND OF PETITIONER'S PSYCHOLOGICAL INCAPACITY; III THE HONORABLE COURT OF APPEALS ERRED IN UPHOLDING THE DECISION OF THE TRIAL COURT AS REGARDS THE ORDER TO FORFEIT THE SHARE OF PETITIONER IN HIS SHARE OF THE CONJUGAL ASSETS.29 Our Ruling I. The stringent rules of procedures may be relaxed to serve the demands of substantial justice and in the Court's exercise of equity jurisdiction. Generally, an appeal taken either to the Supreme Court or the CA by the wrong or inappropriate mode shall be dismissed.30This is to prevent the party from benefiting from one's neglect and mistakes. However, like most rules, it carries certain exceptions. After all, the ultimate purpose of all rules of procedures is to achieve substantial justice as expeditiously as possible.31 Annulment of judgment under Rule 47 is a last remedy. It can not be resorted to if the ordinary remedies are available or no longer available through no fault of petitioner.32 However, in Buenaflor v. Court of Appeals,33 this Court clarified the proper appreciation for technical rules of procedure, in this wise: Rules of procedures are intended to promote, not to defeat, substantial justice and, therefore, they should not be applied in a very rigid and technical sense. The exception is that while the Rules are liberally construed, the provisions with respect to the rules on the manner and periods for perfecting appeals are strictly applied. As an exception to the exception, these rules have sometimes been relaxed on equitable considerations. Also, in some cases the Supreme Court has given due course to an appeal perfected out of time where a stringent application of the rules would have denied it, but only when to do so would serve the demands of substantial

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justice and in the exercise of equity jurisdiction of the Supreme Court.34 (Emphasis and underscoring supplied) For reasons of justice and equity, this Court has allowed exceptions to the stringent rules governing appeals.35 It has, in the past, refused to sacrifice justice for technicality.36 After discovering the palpable error of his petition, Manuel seeks the indulgence of this Court to consider his petition before the CA instead as a petition for certiorari under Rule 65. A perusal of the said petition reveals that Manuel imputed grave abuse of discretion to the lower court for annulling his marriage on account of his alleged homosexuality. This is not the first time that this Court is faced with a similar situation. In Nerves v. Civil Service Commission,37 petitioner Delia R. Nerves elevated to the CA a Civil Service Commission (CSC) decision suspending her for six (6) months. The CSC ruled Nerves, a public school teacher, is deemed to have already served her six-month suspension during the pendency of the case. Nevertheless, she is ordered reinstated without back wages. On appeal, Nerves stated in her petition, inter alia: 1. This is a petition for certiorari filed pursuant to Article IX-A, Section 7 of the Constitution of the Philippines and under Rule 65 of the Rules of Court. 2. But per Supreme Court Revised Administrative Circular No. 1-95 (Revised Circular No. 1-91) petitioner is filing the instant petition with this Honorable Court instead of the Supreme Court.38 (Underscoring supplied) The CA dismissed Nerves' petition for certiorari for being the wrong remedy or the inappropriate mode of appeal.39 The CA opined that "under the Supreme Court Revised Administrative Circular No. 1-95 x x x appeals from judgments or final orders or resolutions of CSC is by a petition for review."40 This Court granted Nerves petition and held that she had substantially complied with the Administrative Circular. The Court stated: That it was erroneously labeled as a petition for certiorari under Rule 65 of the Rules of Court is only a minor procedural lapse, not fatal to the appeal. x x x More importantly, the appeal on its face appears to be impressed with merit. Hence, the Court of Appeals should have overlooked the insubstantial defects of the petition x x x in order to do justice to the parties concerned. There is, indeed, nothing sacrosanct about procedural rules, which should be liberally construed in order to promote their object and assist the parties in obtaining just, speedy, and inexpensive determination of every action or proceeding. As it has been said, where the rigid application of the rules would frustrate substantial justice, or bar the vindication of a legitimate grievance, the courts are justified in exempting a particular case from the operation of the rules.41(Underscoring supplied) Similarly, in the more recent case of Tan v. Dumarpa,42 petitioner Joy G. Tan availed of a wrong remedy by filing a petition for review on certiorari instead of a motion for new trial or an ordinary appeal. In the interest of justice, this Court considered the petition, pro hac vice, as a petition for certiorari under Rule 65. This Court found that based on Tan's allegations, the trial court prima facie committed grave abuse of discretion in rendering a judgment by default. If uncorrected, it will cause petitioner great injustice. The Court elucidated in this wise:

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Indeed, where as here, there is a strong showing that grave miscarriage of justice would result from the strict application of the Rules, we will not hesitate to relax the same in the interest of substantial justice.43 (Underscoring supplied) Measured by the foregoing yardstick, justice will be better served by giving due course to the present petition and treating petitioner's CA petition as one for certiorari under Rule 65, considering that what is at stake is the validity or non-validity of a marriage. In Salazar v. Court of Appeals,44 citing Labad v. University of Southeastern Philippines, this Court reiterated: x x x The dismissal of appeals on purely technical grounds is frowned upon. While the right to appeal is a statutory, not a natural right, nonetheless it is an essential part of our judicial system and courts should proceed with caution so as not to deprive a party of the right to appeal, but rather, ensure that every party-litigant has the amplest opportunity for the proper and just disposition of his cause, free from the constraints of technicalities.45 Indeed, it is far better and more prudent for a court to excuse a technical lapse and afford the parties a review of the case on the merits to attain the ends of justice.46 Furthermore, it was the negligence and incompetence of Manuel's counsel that prejudiced his right to appeal. His counsel, Atty. Christine Dugenio, repeatedly availed of inappropriate remedies. After the denial of her notice of appeal, she failed to move for reconsideration or new trial at the first instance. She also erroneously filed a petition for annulment of judgment rather than pursue an ordinary appeal. These manifest errors were clearly indicative of counsel's incompetence. These gravely worked to the detriment of Manuel's appeal. True it is that the negligence of counsel binds the client. Still, this Court has recognized certain exceptions: (1) where reckless or gross negligence of counsel deprives the client of due process of law; (2) when its application will result in outright deprivation of the client's liberty and property; or (3) where the interest of justice so require.47 The negligence of Manuel's counsel falls under the exceptions. Ultimately, the reckless or gross negligence of petitioner's former counsel led to the loss of his right to appeal. He should not be made to suffer for his counsel's grave mistakes. Higher interests of justice and equity demand that he be allowed to ventilate his case in a higher court. In Apex Mining, Inc. v. Court of Appeals,48 this Court explained thus: It is settled that the negligence of counsel binds the client. This is based on the rule that any act performed by a counsel within the scope of his general or implied authority is regarded as an act of his client. However, where counsel is guilty of gross ignorance, negligence and dereliction of duty, which resulted in the client's being held liable for damages in a damage suit, the client is deprived of his day in court and the judgment may be set aside on such ground. In the instant case, higher interests of justice and equity demand that petitioners be allowed to present evidence on their defense. Petitioners may not be made to suffer for the lawyer's mistakes. This Court will always be disposed to grant relief to parties aggrieved by perfidy, fraud, reckless inattention and downright incompetence of lawyers, which has the consequence of depriving their clients, of their day in court.49(Emphasis supplied)

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Clearly, this Court has the power to except a particular case from the operation of the rule whenever the demands of justice require it. With more conviction should it wield such power in a case involving the sacrosanct institution of marriage. This Court is guided with the thrust of giving a party the fullest opportunity to establish the merits of one's action.50 The client was likewise spared from counsel's negligence in Government Service Insurance System v. Bengson Commercial Buildings, Inc.51 and Ancheta v. Guersey-Dalaygon.52 Said the Court in Bengson: But if under the circumstances of the case, the rule deserts its proper office as an aid to justice and becomes a great hindrance and chief enemy, its rigors must be relaxed to admit exceptions thereto and to prevent a miscarriage of justice. In other words, the court has the power to except a particular case from the operation of the rule whenever the purposes of justice require it.53 II. Concealment of homosexuality is the proper ground to annul a marriage, not homosexuality per se. Manuel is a desperate man determined to salvage what remains of his marriage. Persistent in his quest, he fought back all the heavy accusations of incapacity, cruelty, and doubted masculinity thrown at him. The trial court declared that Leonida's petition for nullity had "no basis at all because the supporting grounds relied upon can not legally make a case under Article 36 of the Family Code." It went further by citing Republic v. Molina:54 Indeed, mere allegations of conflicting personalities, irreconcilable differences, incessant quarrels and/or beatings, unpredictable mood swings, infidelities, vices, abandonment, and difficulty, neglect, or failure in the performance of some marital obligations do not suffice to establish psychological incapacity.55 If so, the lower court should have dismissed outright the petition for not meeting the guidelines set in Molina. What Leonida attempted to demonstrate were Manuel's homosexual tendencies by citing overt acts generally predominant among homosexual individuals.56 She wanted to prove that the perceived homosexuality rendered Manuel incapable of fulfilling the essential marital obligations. But instead of dismissing the petition, the trial court nullified the marriage between Manuel and Leonida on the ground of vitiated consent by virtue of fraud. In support of its conclusion, the lower court reasoned out: As insinuated by the State (p. 75, TSN, 15 December 2003), when there is smoke surely there is fire. Although vehemently denied by defendant, there is preponderant evidence enough to establish with certainty that defendant is really a homosexual. This is the fact that can be deduced from the totality of the marriage life scenario of herein parties. Before his marriage, defendant knew very well that people around him even including his own close friends doubtedhis true sexual preference (TSN, pp. 3536, 13 December 2000; pp. 73-75, 15 December 2003). After receiving many forewarnings, plaintiff told defendant about the rumor she heard but defendant did not do anything to prove to the whole world once and for all the truth of all his denials. Defendant threatened to sue those people but nothing happened after that. There may have been more important matters to attend to than to waste

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time and effort filing cases against and be effected by these people and so, putting more premiums on defendant's denials, plaintiff just the same married him. Reasons upon reasons may be advanced to either exculpate or nail to the cross defendant for his act of initially concealing his homosexuality to plaintiff, but in the end, only one thing is certain - even during his marriage with plaintiff, the smoke of doubt about his real preference continued and even got thicker, reason why obviously defendant failed to establish a happy and solid family; and in so failing, plaintiff and their children became his innocent and unwilling victims. Yes, there is nothing untoward of a man if, like herein defendant, he is meticulous over even small details in the house (sic) like wrongly folded bed sheets, etc. or if a man is more authoritative in knowing what clothes or jewelry shall fit his wife (pp. 77-81, TSN, 15 December 2003); but these admissions of defendant taken in the light of evidence presented apparently showing that he had extra fondness of his male friends (sic) to the extent that twice on separate occasions (pp. 4-7, TSN, 14 February 2001) he was allegedly seen by plaintiff kissing another man lips-tolips plus the homosexual magazines and tapes likewise allegedly discovered underneath his bed (Exhibits "L" and "M"), the doubt as to his real sex identity becomes stronger. The accusation of plaintiff versus thereof of defendant may be the name of the game in this case; but the simple reason of professional rivalry advanced by the defendant is certainly not enough to justify and obscure the question why plaintiff should accuse him of such a very untoward infidelity at the expense and humiliation of their children and family as a whole.57 Evidently, no sufficient proof was presented to substantiate the allegations that Manuel is a homosexual and that he concealed this to Leonida at the time of their marriage. The lower court considered the public perception of Manuel's sexual preference without the corroboration of witnesses. Also, it took cognizance of Manuel's peculiarities and interpreted it against his sexuality. Even assuming, ex gratia argumenti, that Manuel is a homosexual, the lower court cannot appreciate it as a ground to annul his marriage with Leonida. The law is clear - a marriage may be annulled when the consent of either party was obtained by fraud,58 such as concealment of homosexuality.59 Nowhere in the said decision was it proven by preponderance of evidence that Manuel was a homosexual at the onset of his marriage and that he deliberately hid such fact to his wife.60 It is the concealment of homosexuality, and not homosexuality per se, that vitiates the consent of the innocent party. Such concealment presupposes bad faith and intent to defraud the other party in giving consent to the marriage. Consent is an essential requisite of a valid marriage. To be valid, it must be freely given by both parties. An allegation of vitiated consent must be proven by preponderance of evidence. The Family Code has enumerated an exclusive list of circumstances61 constituting fraud. Homosexuality per se is not among those cited, but its concealment. This distinction becomes more apparent when we go over the deliberations62 of the Committees on the Civil Code and Family Law, to wit:

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Justice Caguioa remarked that this ground should be eliminated in the provision on the grounds for legal separation. Dean Gupit, however, pointed out that in Article 46, they are talking only of "concealment," while in the article on legal separation, there is actuality. Judge Diy added that in legal separation, the ground existed after the marriage, while in Article 46, the ground existed at the time of the marriage. Justice Reyes suggested that, for clarity, they add the phrase "existing at the time of the marriage" at the end of subparagraph (4). The Committee approved the suggestion.63 To reiterate, homosexuality per se is only a ground for legal separation. It is its concealment that serves as a valid ground to annul a marriage.64 Concealment in this case is not simply a blanket denial, but one that is constitutive of fraud. It is this fundamental element that respondent failed to prove. In the United States, homosexuality has been considered as a basis for divorce. It indicates that questions of sexual identity strike so deeply at one of the basic elements of marriage, which is the exclusive sexual bond between the spouses.65 In Crutcher v. Crutcher,66 the Court held: Unnatural practices of the kind charged here are an infamous indignity to the wife, and which would make the marriage relation so revolting to her that it would become impossible for her to discharge the duties of a wife, and would defeat the whole purpose of the relation. In the natural course of things, they would cause mental suffering to the extent of affecting her health.67 However, although there may be similar sentiments here in the Philippines, the legal overtones are significantly different. Divorce is not recognized in the country. Homosexuality and its alleged incompatibility to a healthy heterosexual life are not sanctioned as grounds to sever the marriage bond in our jurisdiction. At most, it is only a ground to separate from bed and board. What was proven in the hearings a quo was a relatively blissful marital union for more than eleven (11) years, which produced three (3) children. The burden of proof to show the nullity of the marriage rests on Leonida. Sadly, she failed to discharge this onus. The same failure to prove fraud which purportedly resulted to a vitiated marital consent was found in Villanueva v. Court of Appeals.68 In Villanueva, instead of proving vitiation of consent, appellant resorted to baseless portrayals of his wife as a perpetrator of fraudulent schemes. Said the Court: Factual findings of the Court of Appeals, especially if they coincide with those of the trial court, as in the instant case, are generally binding on this Court. We affirm the findings of the Court of Appeals that petitioner freely and voluntarily married private respondent and that no threats or intimidation, duress or violence compelled him to do so, thus Appellant anchored his prayer for the annulment of his marriage on the ground that he did not freely consent to be married to the appellee. He cited several incidents that created on his mind a reasonable and well-grounded fear of an imminent and grave danger to his life and safety. x x x The Court is not convinced that appellant's apprehension of danger to his person is so overwhelming as to deprive him of the will to enter voluntarily to a contract of

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marriage. It is not disputed that at the time he was allegedly being harassed, appellant worked as a security guard in a bank. Given the rudiments of selfdefense, or, at the very least, the proper way to keep himself out of harm's way. x xx Appellant also invoked fraud to annul his marriage, as he was made to believe by appellee that the latter was pregnant with his child when they were married. Appellant's excuse that he could not have impregnated the appellee because he did not have an erection during their tryst is flimsy at best, and an outright lie at worst. The complaint is bereft of any reference to his inability to copulate with the appellee. x x x xxxx x x x The failure to cohabit becomes relevant only if it arises as a result of the perpetration of any of the grounds for annulling the marriage, such as lack of parental consent, insanity, fraud, intimidation, or undue influence x x x. Since the appellant failed to justify his failure to cohabit with the appellee on any of these grounds, the validity of his marriage must be upheld.69 Verily, the lower court committed grave abuse of discretion, not only by solely taking into account petitioner's homosexuality per se and not its concealment, but by declaring the marriage void from its existence. This Court is mindful of the constitutional policy to protect and strengthen the family as the basic autonomous social institution and marriage as the foundation of the family.70 The State and the public have vital interest in the maintenance and preservation of these social institutions against desecration by fabricated evidence.71 Thus, any doubt should be resolved in favor of the validity of marriage. III. In a valid marriage, the husband and wife jointly administer and enjoy their community or conjugal property. Article 96 of the Family Code, on regimes of absolute community property, provides: Art. 96. The administration and enjoyment of the community property shall belong to both spouses jointly. In case of disagreement, the husband's decision shall prevail, subject to recourse to the court by the wife for a proper remedy, which must be availed of within five years from the date of the contract implementing such decision. 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 offerors.

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A similar provision, Article 12472 prescribes joint administration and enjoyment in a regime of conjugal partnership. In a valid marriage, both spouses exercise administration and enjoyment of the property regime, jointly. In the case under review, the RTC decreed a dissolution of the community property of Manuel and Leonida. In the same breath, the trial court forfeited Manuel's share in favor of the children. Considering that the marriage is upheld valid and subsisting, the dissolution and forfeiture of Manuel's share in the property regime is unwarranted. They remain the joint administrators of the community property. WHEREFORE, the petition is GRANTED. The appealed Decision is REVERSED and SET ASIDE and the petition in the trial court to annul the marriage is DISMISSED. SO ORDERED. RUBEN T. REYES Associate Justice WE CONCUR: CONSUELO YNARES-SANTIAGO Associate Justice Chairperson MA. ALICIA AUSTRIA-MARTINEZ Associate Justice

MINITA V. CHICO-NAZARIO Associate Justice

ANTONIO EDUARDO B. NACHURA 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. CONSUELO YNARES-SANTIAGO Associate Justice Chairperson, Third Division CERTIFICATION Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I certify 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. REYNATO S. PUNO Chief Justice

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