Union of hearts and wealth
Divorce is a current buzzword in the public discourse. However, before discussing the termination of a valid marriage (to be distinguished from declaring the nullity or annulment of an invalid union), let me first write about its beginning. When a groom and a bride exchange “I do’s,” the law instantly takes over their personal and property relationship.
Union of wallets. During the marriage, or even after its dissolution, a spouse cannot be examined without the consent of the other as to any letter, promise or other communication received by one from the other during the marriage. To enhance the marital unity, neither spouse can be examined for or against the other, without the latter’s consent, except in a civil case filed by one against the other, or in a criminal case committed by one against the other.
Every prospective couple must however know that our Family Code unites not just their hearts and spirit; it also binds their wealth and wallets into what is known as the “absolute community of property.” Under this system, all pieces of property owned by each of the couple prior to their marriage, or acquired thereafter, ipso facto become commonly or jointly owned by both spouses.
By saying “I do,” each of the spouses automatically loses sole ownership of what each of them owned prior to the marriage, even if the titles thereto remain registered in the name of only one of them. Accordingly, land, condominiums, cars, bank deposits, jewelry and other assets of each become communal in ownership.
Excluded from joint ownership are (1) property for personal or exclusive use like clothing, shoes and cosmetics; (2) donations obtained (to be more precise, “property acquired by gratuitous title”) during the marriage; and (3) property of a widow or widower who has legitimate children and grandchildren by the former marriage, who stand to inherit such property.
Consistent with the third item, the widow or widower is required to liquidate and distribute the estate of the deceased spouse within six months from the latter’s death. Otherwise, “a mandatory regime of complete separation of property shall govern the property relations of the subsequent marriage.”
The administration and enjoyment of all community property, including those owned separately prior to the marriage, belong to both spouses jointly. Thus, each is entitled to the equal use of the family home, car or TV set. Neither spouse may sell, mortgage or donate any communal asset without the other’s consent.
Together, the couple shall fix the family home, manage the household, and exercise parental authority over their minor children. However, either of the spouses may exercise any legitimate profession, occupation or business without the consent of the other. The latter may object only on “valid, serious and moral grounds.” But the income derived from such profession, occupation and business is communal.
Prenuptial agreement. To be exempt from this all-embracing union of wealth and wallets, the couple needs to execute a “prenuptial agreement” (also called “marriage settlement”).
In the marriage settlement, the couple may agree on the absolute community of property, or the conjugal partnership of gains, or the complete separation of property, or any other regime (like placing all property in the ownership and control of only one spouse). Unless a marriage settlement is executed, the absolute community system automatically kicks in upon the celebration of the wedding.
The prenuptial agreement must be in writing and signed by the couple before the wedding. The provisions of the agreement must be carefully defined and studied prior to its execution, because they can no longer be revised or changed after the wedding. Like the marriage vow, the marriage settlement cannot be ended or modified even by mutual agreement after the wedding. Modifications or changes must be made before the wedding.
Conjugal partnership of gains. Prior the effectivity of the Family Code on Aug. 3, 1988, the automatic marital property system was called the conjugal partnership of gains. Under this regime, each of the spouses retains the ownership of their respective assets.
But the products, fruits or rentals of these assets and the income derived from the spouses’ separate profession, occupation or business accrue to a common fund. Thus, the rentals of a condo owned by a spouse prior to the marriage are conjugal even if the condo itself is still separately owned. In contrast, under the absolute community system, both the condo and the rentals are conjugal.
The regime most commonly opted by those who enter into marriage settlements is the conjugal property of gains. One advantage is that the agreement need not contain many details because the parameters of this system are already laid out in the Family Code. In fact, those who were married prior to the effectivity of the Code were automatically covered by this property system.
When a man and woman who are capacitated to marry each other, live exclusively with each other as husband and wife without the benefit of marriage or under a void marriage, their wages and salaries shall be owned by them in equal shares and the property acquired by them through their joint effort, work or industry shall be owned by them in equal shares.
However, if one of the parties is validly married to another, his or her share in the co-ownership shall accrue to the absolute community of property or conjugal partnership existing in such valid marriage.
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