Case Digest: So v. Republic (G.R. No. 170603)

So v. Republic | G.R. No. 170603 | 29 Jan 2007 | Callejo, Sr. J. | Art IV (Section 1, Par 4) | Petitioners: Edison So Respondents: Republic of the Philippines Recit Ready Summary Herein Petitioner So filed for a Petition for Naturalization under CA No. 473 aka the Revised Naturalization Law.He presented 2 witnesses à fam business lawyer Atty. Adasa & UST classmate Mark Salcedo. RTC granted So’s petition. Respondent Republic of the Phil through OSG said not so fast! Coz SolGen claims na the 2 witnesses So presented did not know him (So) well enough and that they only gave general statements upon being asked about the character and moral conduct of So. CA set aside RTC’s decision. Hence, this present petition. The issue is W/N So qualifies for Philippines Citizenship and the Court said NO. It was wrong for So to claim that that RA 9139 should apply to his case instead of CA No. 473. This is because the latter applied to ALL ALIENS regardless of class while the former applies to nati...
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Case Digest: PNB v. Venancio Reyes (G.R. No 212483)

PNB v. Venancio Reyes | G.R. No. 212483 | October 5, 2016 | Topic: Conjugal property
FACTS:
  • Venancio Reyes is married to Lilia since 1973. During their union they acquired three parcels of land in Malolos, Bulacan. The properties were mortgaged to Philippine National Bank (PNB) to secure a loan amounting to P3,000,000. According to PNB, spouses Reyes contracted and duly consented to the loan.
  • The Spouses failed to pay for the loan obligations which resulted to PNB foreclosing the mortgaged real properties. PNB won as highest bidder in the auction sale.
  • Venancio filed before the RTC a Complaint for Annulment of Certificate of Sale and Real Estate Mortgage against PNB.  Venancio claimed that his wife undertook the loan and mortgage without his consent and his signature. Since the three lots involved were conjugal properties, he argued that the mortgage constituted over them was void.
  • The RTC ordered the annulment of the Real Estate Mortgage and directed Lilia Reyes to reimburse PNB the loan amount with interest. The CA denied the appeal brought by PNB. Hence, this present petition before the Supreme Court.
  • PNB argues that the mortgage is valid, and that the conjugal partnership should be liable for the loan. Also, PNB contends that both Venancio and Lilia duly consented to the loan and mortgage and that it was impossible for Venancio to have no knowledge of the transactions since the spouses lived together in the same house where the notices and demand letters were sent.  
ISSUE:  
  • Whether the Court of Appeals erred in declaring the Real Estate Mortgage void? 
  • Whether the conjugal partnership should be held liable for the loan contracted unilaterally by Lilia Reyes 
RULING: 
  • On the first issue, the real estate mortgage over a conjugal property is void if the non-contracting spouse did not give consent. The real estate mortgage over the conjugal properties is void for want of consent from Venancio. The Family Code, Article 124 is clear: written consent of the spouse who did not encumber the property is necessary before any disposition of conjugal property can be valid. As the marriage between Venacio and Lilia was celebrated before the effectivity of the Family Code (they were married in 1973), their property regime is that of Conjugal Partnership of Gains. Any disposition or encumbrance of a conjugal property by one spouse must be consented to by the other; otherwise it is void. 
  • As to the second issue, the principal obligation to pay the loan remains valid despite the declaration of a void mortgage. The conjugal partnership should be made liable to the extend that it redounded to the benefit of the family. Article 122 of the Family Code applies to debts that were contracted by a spouse and redounded to the benefit of the family. It applies specifically to the loan that Lilia contracted, but not to the mortgage. A mortgage is merely an accessory agreement and does not affect the principal contract of loan. The mortgages, while void, can still be considered as instruments evidencing the indebtedness. 
  • It must be remembered that nowhere in the RTC decision to which the CA affirmed, did the courts say that PNB may no longer collect from the spouses the amount of the loan. It is only the mortgage which the courts declared void. 
  • The mortgage over the conjugal property is void and cannot be foreclosed. However, petitioner can still hold the conjugal partnership liable for the principal obligation since the loan is presumed to have redounded to the benefit of the family. If the conjugal partnership is insufficient to cover the liability, the husband is solidarity liable with the wife for the unpaid balance. 
  • Article 121 holds that: 
    • If the conjugal partnership is insufficient to cover the foregoing liabilities, the spouses shall be solidarily liable for the unpaid balance with their separate properties. 
  • In this case, if the conjugal properties of the Reyes Spouses are not enough to answer for the loan, petitioner can recover the remaining unpaid balance from the separate properties of either respondent or his wife Lilia. 
DISPOSITION: PETITION DENIED; CA DECISION AFFIRMED

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