Facts: 

Josefina Castillo was only 24 years old when she married Eduardo G. Francisco in 1983. In 1984, the Imus Rural Bank, Inc. executed a deed of absolute sale in favor of Josefina Castillo Francisco, married to Eduardo Francisco, covering 2 parcels of residential land with a house thereon. The Register of Deeds annotated at the dorsal portion of the said titles an Affidavit of Waiver executed by Eduardo where he declared that before his marriage to Josefina, the latter purchased 2 parcels of land, including the house constructed thereon, with her own savings, and that he was waiving whatever claims he had over the property. 

In 1990, Eduardo, who was then the General Manager and President of Reach Out Trading International, bought 7,500 bags of cement from Master Iron Works & Construction Corporation (MIWCC) but failed to pay for the same. The trial court rendered judgment against Eduardo and the sherrif issued a notice of levy on execution over the alleged property of Josefina for the recovery of the balance of the amount due.  Josefina filed a third-party claim over the 2 parcels of land in which she claimed as her paraphernal property. 

Josefina filed a complaint for damages against MIWCC and the sheriff. Before she could commence presenting her evidence, Josefina filed a petition to annul her marriage to Eduardo in the RTC on the ground that when they were married in 1983, Eduardo was already married to one Carmelita Carpio. The RTC declared the marriage null and void for being bigamous.

In 1997, the trial court rendered judgment finding the levy on the subject property and the sale thereof at public auction to be null and void. The trial court held that the property levied by Sheriff Alejo was the sole and exclusive property of Josefina. It also held that MIWCC failed to prove that Eduardo contributed to the acquisition of the property. The CA reversed the decision.

Issue: 

Are the subject properties paraphernal properties of Josefina such that it cannot be held liable for Eduardo’s personal obligations?


Held: 

No. Josefina failed to prove that she acquired the properties with her personal funds before her cohabitation with Eduardo and that she is the sole owner of the properties. The evidence on record shows that the Imus Bank executed a deed of absolute sale over the property to the petitioner on August 31, 1984 and titles over the property were, thereafter, issued to the latter as vendee on September 4, 1984 after her marriage to Eduardo on January 15, 1983.

Article 144 of the New Civil Code does not apply in the present case. This Court in Tumlos v. Fernandez held that Article 144 of the New Civil Code applies only to a relationship between a man and a woman who are not incapacitated to marry each other, or to one in which the marriage of the parties is void from the very beginning. It does not apply to a cohabitation that is adulterous or amounts to concubinage, for it would be absurd to create a co-ownership where there exists a prior conjugal partnership or absolute community between the man and his lawful wife. In this case, the petitioner admitted that when she and Eduardo cohabited, the latter was incapacitated to marry her.

Josefina anchors her claims on Art. 148 of the Family Code. Indeed, the Family Code has filled the hiatus in Article 144 of the New Civil Code by expressly regulating in Article 148 the property relations of couples living in a state of adultery or concubinage. Under Article 256 of the Family Code, the law can be applied retroactively if it does not prejudice vested or acquired rights.

However, she failed to adduce preponderance of evidence that she contributed money, property or industry in the acquisition of the subject property and, hence, is not a co-owner of the property. It is to be noted that Josefina got married at the age of 23. At that age, it is doubtful if she had enough funds of her own to purchase the subject properties as she claimed in her Affidavit of Third Party Claim. Confronted with this reality, she later claimed that the funds were provided by her mother and sister. Aside from her bare claims, however, Josefina offered nothing to prove such allegation. She even failed to divulge the name of her mother and the sources of her income, if any, and that of her sister.(Josefina Francisco vs Master Iron Works & Construction Corporation, G.R. No. 151967, February 16, 2005)