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FIRST DIVISION

[G.R. No. 109557. November 29, 2000]

JOSE UY and his Spouse GLENDA J. UY and GILDA L. JARDELEZA, petitioners, vs. COURT OF APPEALS and
TEODORO L. JARDELEZA, respondents.

DECISION

PARDO, J.:

The case is an appeal via certiorari from the decision[1] of the Court of Appeals and its resolution denying reconsideration[2]
reversing that of the Regional Trial Court, Iloilo, Branch 32[3] and declaring void the special proceedings instituted therein by
petitioners to authorize petitioner Gilda L. Jardeleza, in view of the comatose condition of her husband, Ernesto Jardeleza, Sr., with
the approval of the court, to dispose of their conjugal property in favor of co-petitioners, their daughter and son in law, for the
ostensible purpose of “financial need in the personal, business and medical expenses of her ‘incapacitated’ husband.”

The facts, as found by the Court of Appeals, are as follows:

“This case is a dispute between Teodoro L. Jardeleza (herein respondent) on the one hand, against his mother Gilda L. Jardeleza, and
sister and brother-in-law, the spouses Jose Uy and Glenda Jardeleza (herein petitioners) on the other hand. The controversy came
about as a result of Dr. Ernesto Jardeleza, Sr.’s suffering of a stroke on March 25, 1991, which left him comatose and bereft of any
motor or mental faculties. Said Ernesto Jardeleza, Sr. is the father of herein respondent Teodoro Jardeleza and husband of herein
private respondent Gilda Jardeleza.

“Upon learning that one piece of real property belonging to the senior Jardeleza spouses was about to be sold, petitioner Teodoro
Jardeleza, on June 6, 1991, filed a petition (Annex “A”) before the R.T.C. of Iloilo City, Branch 25, where it was docketed as Special
Proceeding No. 4689, in the matter of the guardianship of Dr. Ernesto Jardeleza, Sr. The petitioner averred therein that the present
physical and mental incapacity of Dr. Ernesto Jardeleza, Sr. prevent him from competently administering his properties, and in order
to prevent the loss and dissipation of the Jardelezas’ real and personal assets, there was a need for a court-appointed guardian to
administer said properties. It was prayed therein that Letters of Guardianship be issued in favor of herein private respondent Gilda
Ledesma Jardeleza, wife of Dr. Ernesto Jardeleza, Sr. It was further prayed that in the meantime, no property of Dr. Ernesto Jardeleza,
Sr. be negotiated, mortgaged or otherwise alienated to third persons, particularly Lot No. 4291 and all the improvements thereon,
located along Bonifacio Drive, Iloilo City, and covered by T.C.T. No. 47337.

“A few days later, or on June 13, 1991, respondent Gilda L. Jardeleza herself filed a petition docketed as Special Proceeding NO.
4691, before Branch 32 of the R.T.C. of Iloilo City, regarding the declaration of incapacity of Ernesto Jardeleza, Sr., assumption of
sole powers of administration of conjugal properties, and authorization to sell the same (Annex “B”). Therein, the petitioner Gilda L.
Jardeleza averred the physical and mental incapacity of her husband, who was then confined for intensive medical care and treatment
at the Iloilo Doctor’s Hospital. She signified to the court her desire to assume sole powers of administration of their conjugal
properties. She also alleged that her husband’s medical treatment and hospitalization expenses were piling up, accumulating to several
hundred thousands of pesos already. For this, she urgently needed to sell one piece of real property, specifically Lot No. 4291 and its
improvements. Thus, she prayed for authorization from the court to sell said property.

“The following day, June 14, 1991, Branch 32 of the R.T.C. of Iloilo City issued an Order (Annex “C”) finding the petition in Spec.
Proc. No. 4691 to be sufficient in form and substance, and setting the hearing thereof for June 20, 1991. The scheduled hearing of the
petition proceeded, attended by therein petitioner Gilda Jardeleza, her counsel, her two children, namely Ernesto Jardeleza, Jr., and
Glenda Jardeleza Uy, and Dr. Rolando Padilla, one of Ernesto Jardeleza, Sr.’s attending physicians.

“On that same day, June 20, 1991, Branch 32 of the RTC of Iloilo City rendered its Decision (Annex “D”), finding that it was
convinced that Ernesto Jardeleza, Sr. was truly incapacitated to participate in the administration of the conjugal properties, and that the
sale of Lot No. 4291 and the improvements thereon was necessary to defray the mounting expenses for treatment and Hospitalization.
The said court also made the pronouncement that the petition filed by Gilda L. Jardeleza was “pursuant to Article 124 of the Family
Code, and that the proceedings thereon are governed by the rules on summary proceedings sanctioned under Article 253 of the same
Code x x x.

“The said court then disposed as follows:

“WHEREFORE, there being factual and legal bases to the petition dated June 13, 1991, the Court hereby renders judgment as follows:
“1) declaring Ernesto Jardeleza, Sr., petitioner’s husband, to be incapacitated and unable to participate in the administration of
conjugal properties;

“2) authorizing petitioner Gilda L. Jardeleza to assume sole powers of administration of their conjugal properties; and

“3) authorizing aforesaid petitioner to sell Lot No. 4291 of the Cadastral Survey of Iloilo, situated in Iloilo City and covered by TCT
No. 47337 issued in the names of Ernesto Jardeleza, Sr. and Gilda L. Jardeleza and the buildings standing thereof.

“SO ORDERED.

“On June 24, 1991, herein petitioner Teodoro Jardeleza filed his Opposition to the proceedings before Branch 32 in Spec. Proc. Case
No. 4691, said petitioner being unaware and not knowing that a decision has already been rendered on the case by public respondent.

“On July 3, 1991, herein petitioner Teodoro Jardeleza filed a motion for reconsideration of the judgment in Spec. Proc. No. 4691 and a
motion for consolidation of the two cases (Annex “F”). He propounded the argument that the petition for declaration of incapacity,
assumption of sole powers of administration, and authority to sell the conjugal properties was essentially a petition for guardianship of
the person and properties of Ernesto Jardeleza, Sr. As such, it cannot be prosecuted in accordance with the provisions on summary
proceedings set out in Article 253 of the Family Code. It should follow the rules governing special proceedings in the Revised Rules
of Court which require procedural due process, particularly the need for notice and a hearing on the merits. On the other hand, even
if Gilda Jardeleza’s petition can be prosecuted by summary proceedings, there was still a failure to comply with the basic
requirements thereof, making the decision in Spec. Proc. No. 4691 a defective one. He further alleged that under the New Civil Code,
Ernesto Jardeleza, Sr. had acquired vested rights as a conjugal partner, and that these rights cannot be impaired or prejudiced without
his consent. Neither can he be deprived of his share in the conjugal properties through mere summary proceedings. He then restated
his position that Spec. Proc. No. 4691 should be consolidated with Spec. Proc. No. 4689 which was filed earlier and pending before
Branch 25.

“Teodoro Jardeleza also questioned the propriety of the sale of Lot No. 4291 and the improvements thereon supposedly to pay the
accumulated financial obligations arising from Ernesto Jardeleza, Sr.’s hospitalization. He alleged that the market value of the
property would be around Twelve to Fifteen Million Pesos, but that he had been informed that it would be sold for much less. He also
pointed out that the building thereon which houses the Jardeleza Clinic is a monument to Ernesto Jardeleza Sr.’s industry, labor and
service to his fellowmen. Hence, the said property has a lot of sentimental value to his family. Besides, argued Teodoro Jardeleza,
then conjugal partnership had other liquid assets to pay off all financial obligations. He mentioned that apart from sufficient cash,
Jardeleza, Sr. owned stocks of Iloilo Doctors’ Hospital which can be off-set against the cost of medical and hospital bills.
Furthermore, Ernesto Jardeleza, Sr. enjoys certain privileges at the said hospital which allows him to pay on installment basis.
Moreover, two of Ernesto Jardeleza Sr.’s attending physicians are his own sons who do not charge anything for their professional
services.

“On July 4, 1991, Teodoro Jardeleza filed in Spec. Proc. No. 4691 a supplement to his motion for reconsideration (Annex “G”). He
reiterated his contention that summary proceedings was irregularly applied. He also noted that the provisions on summary
proceedings found in Chapter 2 of the Family Code comes under the heading on “Separation in Fact Between Husband and Wife”
which contemplates of a situation where both spouses are of disposing mind. Thus, he argued that were one spouse is “comatose
without motor and mental faculties,” the said provisions cannot be made to apply.

“While the motion for reconsideration was pending, Gilda Jardeleza disposed by absolute sale Lot No. 4291 and all its improvements
to her daughter, Ma. Glenda Jardeleza Uy, for Eight Million Pesos (P8,000,000.00), as evidenced by a Deed Absolute Sale dated July
8, 1991 executed between them (p. 111, Rollo). Under date of July 23, 1991, Gilda Jardeleza filed an urgent ex-parte motion for
approval of the deed of absolute sale.

“On August 12, 1991 Teodoro Jardeleza filed his Opposition to the motion for approval of the deed of sale on the grounds that: (1) the
motion was prematurely filed and should be held in abeyance until the final resolution of the petition; (2) the motion does not allege
nor prove the justifications for the sale; and (3) the motion does not allege that had Ernesto Jardeleza, Sr. been competent, he would
have given his consent to the sale.

“Judge Amelita K. del Rosario-Benedicto of Branch 32 of the respondent Court, who had penned the decision in Spec. Proc. No. 4691
had in the meantime formally inhibited herself from further acting in this case (Annex “I”). The case was then reraffled to Branch 28
of the said court.

“On December 19, 1991, the said court issued an Order (Annex “M”) denying herein petitioner’s motion for reconsideration and
approving respondent Jardeleza’s motion for approval of the deed of absolute sale. The said court ruled that:
“After a careful and thorough perusal of the decision, dated June 20, 1991, the Motion for Reconsideration, as well as its supplements
filed by “oppositor”, Teodoro L. Jardeleza, through counsel, and the opposition to the Motion for Reconsideration, including its
supplements, filed by petitioner, through counsel, this Court is of the opinion and so holds, that her Honor, Amelita K. del Rosario-
Benedicto, Presiding Judge of Branch 32, of this Court, has properly observed the procedure embodied under Article 253, in relation
to Article 124, of the Family Code, in rendering her decision dated June 20, 1991.

“Also, as correctly stated by petitioner, through counsel, that “oppositor” Teodor L. Jardeleza does not have the personality to oppose
the instant petition considering that the property or properties, subject of the petition, belongs to the conjugal partnership of the
spouses Ernesto and Gilda Jardeleza, who are both still alive.

“In view thereof, the Motion for Reconsideration of “oppositor” Teodoro L. Jardeleza, is hereby denied for lack of merit.

“Considering the validity of the decision dated June 20, 1991, which among others, authorized Gilda L. Jardeleza to sell Lot No. 4291
of the Cadastral Survey of Iloilo, covered by Transfer Certificate of Title No. 47337 issued in the names of Ernesto Jardeleza, Sr., and
Gilda L. Jardeleza and the building standing thereon, the Urgent Ex-Parte Motion for Approval of Deed of Absolute Sale dated July
23, 1991, filed by petitioner, through counsel, is hereby granted and the deed of absolute sale, executed and notarized on July 8, 1991,
by and between Gilda L. Jardeleza, as vendor, and Ma. Glenda Jardeleza, as vendee, is hereby approved, and the Register of Deeds of
Iloilo City, is directed to register the sale and issue the corresponding transfer certificate of title to the vendee.

“SO ORDERED.”[4]

On December 9, 1992, the Court of Appeals promulgated its decision reversing the appealed decision and ordering the trial court to
dismiss the special proceedings to approve the deed of sale, which was also declared void.[5]

On December 29, 1992, petitioners filed a motion for reconsideration,[6] however, on March 29, 1993, the Court of Appeals denied
the motion, finding no cogent and compelling reason to disturb the decision.[7]

Hence, this appeal.[8]

The issue raised is whether petitioner Gilda L. Jardeleza as the wife of Ernesto Jardeleza, Sr. who suffered a stroke, a cerebrovascular
accident, rendering him comatose, without motor and mental faculties, and could not manage their conjugal partnership property may
assume sole powers of administration of the conjugal property under Article 124 of the Family Code and dispose of a parcel of land
with its improvements, worth more than twelve million pesos, with the approval of the court in a summary proceedings, to her co-
petitioners, her own daughter and son-in-law, for the amount of eight million pesos.

The Court of Appeals ruled that in the condition of Dr. Ernesto Jardeleza, Sr., the procedural rules on summary proceedings in relation
to Article 124 of the Family Code are not applicable. Because Dr. Jardeleza, Sr. was unable to take care of himself and manage the
conjugal property due to illness that had rendered him comatose, the proper remedy was the appointment of a judicial guardian of the
person or estate or both of such incompetent, under Rule 93, Section 1, 1964 Revised Rules of Court. Indeed, petitioner earlier had
filed such a petition for judicial guardianship.

Article 124 of the Family Code provides as follows:

“ART. 124. The administration and enjoyment of the conjugal partnership 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 conjugal properties, the
other spouse may assume sole powers of administration. These powers do not include the powers of disposition or encumbrance
which must have 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. (165a).”

In regular manner, the rules on summary judicial proceedings under the Family Code govern the proceedings under Article 124 of the
Family Code. The situation contemplated is one where the spouse is absent, or separated in fact or has abandoned the other or consent
is withheld or cannot be obtained. Such rules do not apply to cases where the non-consenting spouse is incapacitated or incompetent to
give consent. In this case, the trial court found that the subject spouse "is an incompetent" who was in comatose or semi-comatose
condition, a victim of stroke, cerebrovascular accident, without motor and mental faculties, and with a diagnosis of brain stem infarct.
[9] In such case, the proper remedy is a judicial guardianship proceedings under Rule 93 of the 1964 Revised Rules of Court.

Even assuming that the rules of summary judicial proceedings under the Family Code may apply to the wife's administration of the
conjugal property, the law provides that the wife who assumes sole powers of administration has the same powers and duties as a
guardian under the Rules of Court.[10]

Consequently, a spouse who desires to sell real property as such administrator of the conjugal property must observe the procedure
for the sale of the ward’s estate required of judicial guardians under Rule 95, 1964 Revised Rules of Court, not the summary judicial
proceedings under the Family Code.

In the case at bar, the trial court did not comply with the procedure under the Revised Rules of Court. Indeed, the trial court did not
even observe the requirements of the summary judicial proceedings under the Family Code. Thus, the trial court did not serve notice
of the petition to the incapacitated spouse; it did not require him to show cause why the petition should not be granted.

Hence, we agree with the Court of Appeals that absent an opportunity to be heard, the decision rendered by the trial court is void for
lack of due process. The doctrine consistently adhered to by this Court is that a denial of due process suffices to cast on the official act
taken by whatever branch of the government the impress of nullity.[11] A decision rendered without due process is void ab initio and
may be attacked directly or collaterally.[12] “A decision is void for lack of due process if, as a result, a party is deprived of the
opportunity of being heard.”[13] “A void decision may be assailed or impugned at any time either directly or collaterally, by means
of a separate action, or by resisting such decision in any action or proceeding where it is invoked.”[14]

WHEREFORE, the Court AFFIRMS the decision of the Court of Appeals in CA-G. R. SP No. 26936, in toto.

Costs against petitioners.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Puno, Kapunan, and Ynares-Santiago, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 82606 December 18, 1992

PRIMA PARTOSA-JO, petitioner,


vs.
THE HONORABLE COURT OF APPEALS and HO HANG (with aliases JOSE JO and CONSING), respondents.

CRUZ, J.:

The herein private respondent, Jose Jo, admits to having cohabited with three women and fathered fifteen children. The first of these
women, the herein petitioner, claims to be his legal wife whom he begot a daughter, Monina Jo. The other women and their respective
offspring are not parties of these case.

In 1980, the petitioner filed a complaint against Jo for judicial separation of conjugal property, docketed as Civil Case No. 51, in
addition to an earlier action for support, also against him and docketed as Civil Case No. 36, in the Regional Trial Court of Negros
Oriental, Branch 35.

The two cases were consolidated and tried jointly. On November 29, 1983, Judge German G. Lee, Jr. rendered an extensive decision,
the dispositive portion of which read:

WHEREFORE, in view of all the foregoing arguments and considerations, this court hereby holds that the
plaintiff Prima Partosa was legally married to Jose Jo alias Ho Hang, alias Consing, and, therefore, is
entitled to support as the lawfully wedded wife and the defendant is hereby ordered to give a monthly
support of P500.00 to the plaintiff Prima Partosa, to be paid on or before the 5th day of every month, and to
give to the plaintiff the amount of P40,000.00 for the construction of the house in Zamboanguita, Negros
Oriental where she may live separately from the defendant being entitled under the law to separate
maintenance being the innocent spouse and to pay the amount of P19,200.00 to the plaintiff by way of
support in arrears and to pay the plaintiff the amount of P3,000.00 in the concept of attorney's fees.

As will be noticed, there was a definite disposition of the complaint for support but none of the complaint for judicial separation of
conjugal property.

Jo elevated the decision to the Court of Appeals, which affirmed the ruling of the trial court in the complaint for support. 1 The
complaint for judicial separation of conjugal property was dismissed for lack of a cause of action and on the ground that separation by
agreement was not covered by Article 178 of the Civil Code.

When their motions for reconsideration were denied, both parties came to this Court for relief. The private respondent's petition for
review on certiorari was dismissed for tardiness in our resolution dated February 17, 1988, where we also affirmed the legality of the
marriage between Jose and Prima and the obligation of the former to support her and her daughter.

This petition deals only with the complaint for judicial separation of conjugal property.

It is here submitted that the Court of Appeals erred in holding that: a) the judicial separation of conjugal property sought was not
allowed under Articles 175, 178 and 191 of the Civil Code; and b) no such separation was decreed by the trial court in the dispositive
portion of its decision.

The private respondent contends that the decision of the trial court can longer be reviewed at this time because it has a long since
become final and executory. As the decretal portion clearly made no disposition of Civil Case No. 51, that case should be considered
impliedly dismissed. The petitioner should have called the attention of the trial court to the omission so that the proper rectification
could be made on time. Not having done so, she is now concluded by the said decision, which can no longer be corrected at this late
hour.

We deal first with the second ground.


While admitting that no mention was made of Civil Case No. 51 in the dispositive portion of the decision of the trial court, the
petitioner argues that a disposition of the case was nonetheless made in the penultimate paragraph of the decision reading as follows:

It is, therefore, hereby ordered that all properties in question are considered properties of Jose Jo, the
defendant in this case, subject to separation of property under Article 178, third paragraph of the Civil
Code, which is subject of separate proceedings as enunciated herein.

The petitioner says she believed this to be disposition enough and so did not feel it was necessary for her to appeal, particularly since
the order embodied in that paragraph was in her favor. It was only when the respondent court observed that there was no dispositive
portion regarding that case and so ordered its dismissal that she found it necessary to come to this Court for relief.

The petitioner has a point.

The dispositive portion of the decision in question was incomplete insofar as it carried no ruling on the complaint for judicial
separation of conjugal property although it was extensively discussed in the body of the decision. The drafting of the decision was
indeed not exactly careful. The petitioner's counsel, noting this, should have taken immediate steps for the rectification for the
omission so that the ruling expressed in the text of the decision could have been embodied in the decretal portion. Such alertness could
have avoided this litigation on a purely technical issue.

Nevertheless, the technicality invoked in this case should not be allowed to prevail over considerations of substantive justive. After all,
the technical defect is not insuperable. We have said time and again that where there is an ambiguity caused by an omission or a
mistake in the dispositive portion of the decision, this Court may clarify such an ambiguity by an amendment even after the judgment
have become final. 2 In doing so, the Court may resort to the pleading filed by the parties and the findings of fact and the conclusions
of law expressed in the text or body of the decision. 3

The trial court made definite findings on the complaint for judicial separation of conjugal property, holding that the petitioner and the
private respondent were legally married and that the properties mentioned by the petitioner were acquired by Jo during their marriage
although they were registered in the name of the apparent dummy.

There is no question therefore that the penultimate paragraph of the decision of the trial court was a ruling based upon such findings
and so should have been embodied in the dispositive portion. The respondent court should have made the necessary modification
instead of dismissing Civil Case No. 51 and thus upholding mere form over substance.

In the interest of substantive justice, and to expedite these proceedings, we hereby make such modification.

And now to the merits of Civil Case No. 51.

The Court of Appeals dismissed the complaint on the ground that the separation of the parties was due to their agreement and not
because of abondonment. The respondent court relied mainly on the testimony of the petitioner, who declared under oath that she left
Dumaguete City, where she and Jo were living together "because that was our agreement." It held that a agreement to live separately
without just cause was void under Article 221 of the Civil Code and could not sustain any claim of abandonment by the aggrieved
spouse. Its conclusion was that the only remedy availabe to the petitioner was legal separation under Article 175 of the Civil Code, 4
by virtue of which the conjugal partnership of property would be terminated.

The petitioner contends that the respondent court has misinterpreted Articles 175, 178 and 191 of the Civil Code. She submits that the
agreement between her and the private respondent was for her to temporarily live with her parents during the initial period of her
pregnancy and for him to visit and support her. They never agreed to separate permanently. And even if they did, this arrangement
was repudiated and ended in 1942, when she returned to him at Dumaguete City and he refused to accept her.

The petitioner invokes Article 178 (3) of the Civil Code, which reads:

Art. 178. The separation in fact between husband and wife without judicial approval, shall not affect the
conjugal partnership, except that:

xxx xxx xxx

(3) If the husband has abandoned the wife without just cause for at least one year, she may petition the
court for a receivership, or administration by her of the conjugal partnership property or separation of
property.
The above-quoted provision has been superseded by Article 128 of the Family Code, which states:

Art. 128. If a spouse without just cause abandons the other or fails to comply with his or her obligations to
the family, the aggrieved spouse may petition the court for receivership, for judicial separation of property,
of for authority to be the sole administrator of the conjugal partnership property, subject to such
precautionary conditions as the court may impose.

The obligations to the family mentioned in the preceding paragraph refer to martial, parental or property
relations.

A spouse is deemed to have abondoned the other when he or she has left the conjugal dwelling without any
intention of returning. The spouse who has left the conjugal dwelling for a period of three months or has
failed within the same period to give any information as to his or her whereabouts shall be prima facie
presumed to have no intention of returning to the conjugal dwelling.

Under the this provision, the aggrieved spouse may petition for judicial separation on either of these grounds:

1. Abondonment by a spouse of the other without just cause; and

2. Failure of one spouse to comply with his or her obligations to the family without just cause, even if she
said spouse does not leave the other spouse.

Abandonment implies a departure by one spouse with the avowed intent never to return, followed by prolonged absence without just
cause, and without in the meantime providing in the least for one's family although able to do so. 5 There must be absolute cessation of
marital relations, duties and rights, with the intention of perpetual separation. 6 This idea is clearly expressed in the above-quoted
provision, which states that "a spouse is deemed to have abandoned the other when he or she has left the conjugal dwelling without
any intention of returning."

The record shows that as early as 1942, the private respondent had already rejected the petitioner, whom he denied admission to their
conjugal home in Dumaguete City when she returned from Zamboanguita. The fact that she was not accepted by Jo demonstrates all
too clearly that he had no intention of resuming their conjugal relationship. Moreover, beginning 1968 until the determination by this
Court of the action for support in 1988, the private respondent refused to give financial support to the petitioner. The physical
separation of the parties, coupled with the refusal by the private respondent to give support to the petitioner, sufficed to constitute
abandonment as a ground for the judicial separation of their conjugal property.

In addition, the petitioner may also invoke the second ground allowed by Article 128, for the fact is that he has failed without just
cause to comply with his obligations to the family as husband or parent. Apart form refusing to admit his lawful wife to their conjugal
home in Dumaguete City, Jo has freely admitted to cohabiting with other women and siring many children by them. It was his refusal
to provide for the petitioner and their daughter that prompted her to file the actions against him for support and later for separation of
the conjugal property, in which actions, significantly, he even denied being married to her. The private respondent has not established
any just cause for his refusal to comply with his obligations to his wife as dutiful husband.

Their separation thus falls also squarely under Article 135 of the Family Code, providing as follows:

Art. 135. Any of the following shall be considered sufficient cause for judicial separation of property:

xxx xxx xxx

(6) That at the time of the petition, the spouse have been separated in fact for at least one year and
reconciliation is highly improbable.

The amendments introduced in the Family Code are applicable to the case before us although they became effective only on August 3,
1988. As we held in Ramirez v. Court of Appeals: 7

The greater weight of authority is inclined to the view that an appellate court, in reviewing a judgment on
appeal, will dispose of a question according to the law prevailing at the term of such disposition, and not
according to the law prevailing at the time of rendition of the appealed judgement. The court will therefore
reverse a judgement which was correct at the time it was originally rendered where, by statute, there has
been an intermediate change in the law which renders such judgement erroneous at the time the case was
finally disposed of on appeal.

The order of judicial separation of the properties in question is based on the finding of both the trial and respondent courts that the
private respondent is indeed their real owner. It is these properties that should now be divided between him and the petitioner, on the
assumption that they were acquired during coverture and so belong to the spouses half and half. As the private respondent is a Chinese
citizen, the division must include such properties properly belonging to the conjugal partnership as may have been registered in the
name of other persons in violation of the Anti-Dummy Law.

The past has caught up with the private respondent. After his extramarital flings and a succession of illegitimate children, he must now
make an accounting to his lawful wife of the properties he denied her despite his promise to their of his eternal love and care.

WHEREFORE, the petition is GRANTED and the assailed decision of the respondent court is MODIFIED. Civil Case No. 51 is
hereby decided in favor the plaintiff, the petitioner herein, and the conjugal property of the petitioner and the private respondent is
hereby ordered divided between them, share and share alike. This division shall be implemented by the trial court after determination
of all the properties pertaining to the said conjugal partnership, including those that may have been illegally registered in the name of
the persons.

SO ORDERED.

Padilla, Griño-Aquino and Bellosillo, JJ., concur.

Footnotes

1 Chua, Segundino G., J., ponente, Coquia, Jorge R. and De Pano, Nathanael, Jr., P. JJ., concurring,
promulgated on January 28, 1987.

2 Republic Surety and Insurance Co., Inc. vs. Intermediate Appellant Court, 152 SCRA 316; Alvendia vs.
Intermediate Appellate Court, 181 SCRA 252.

3 Sentinel Insurance Co., Inc. vs. Court of Appeals. 182 SCRA 516.

4 Art. 175. The conjugal partnership of gains terminates:

(1) Upon the death of either spouse;

(2) When there is a decree of legal separation;

(3) When the marriage is annulled;

(4) In case of judicial separation of property under Article 191.

5 Tolentino, Commentaries and Jurisprudence on the Civil Code of the Philippines, 1990 ed., Vol. 1, p.
398.

6 De la Cruz vs. De la Cruz, 22 SCRA 333.

7 72 SCRA 231.
G.R. No. L-61464 May 28, 1988

BA FINANCE CORPORATION, petitioner,


vs.
THE HONORABLE COURT OF APPEALS, AUGUSTO YULO, LILY YULO (doing business under the name and style of A
& L INDUSTRIES), respondents.

GUTIERREZ, JR., J.:

This is a petition for review seeking to set aside the decision of the Court of Appeals which affirmed the decision of the then Court of
First Instance of Manila, dismissing the complaint instituted by the petitioner and ordering it to pay damages on the basis of the
private respondent's counterclaim.

On July 1, 1975, private respondent Augusto Yulo secured a loan from the petitioner in the amount of P591,003.59 as evidenced by a
promissory note he signed in his own behalf and as representative of the A & L Industries. Respondent Yulo presented an alleged
special power of attorney executed by his wife, respondent Lily Yulo, who manages A & L Industries and under whose name the said
business is registered, purportedly authorizing Augusto Yulo to procure the loan and sign the promissory note. About two months
prior to the loan, however, Augusto Yulo had already left Lily Yulo and their children and had abandoned their conjugal home. When
the obligation became due and demandable, Augusto Yulo failed to pay the same.

On October 7, 1975, the petitioner filed its amended complaint against the spouses Augusto and Lily Yulo on the basis of the
promissory note. It also prayed for the issuance of a writ of attatchment alleging that the said spouses were guilty of fraud in
contracting the debt upon which the action was brought and that the fraud consisted of the spouses' inducing the petitioner to enter into
a contract with them by executing a Deed of Assignment in favor of the petitioner, assigning all their rights, titles and interests over a
construction contract executed by and between the spouses and A. Soriano Corporation on June 19, 1974 for a consideration of
P615,732.50 when, in truth, the spouses did not have any intention of remitting the proceeds of the said construction contract to the
petitioner because despite the provisions in the Deed of Assignment that the spouses shall, without compensation or costs, collect and
receive in trust for the petitioner all payments made upon the construction contract and shall remit to the petitioner all collections
therefrom, the said spouses failed and refuse to remit the collections and instead, misappropriated the proceeds for their own use and
benefit, without the knowledge or consent of the petitioner.

The trial court issued the writ of attachment prayed for thereby enabling the petitioner to attach the properties of A & L Industries.
Apparently not contented with the order, the petitioner filed another motion for the examination of attachment debtor, alleging that the
properties attached by the sheriff were not sufficient to secure the satisfaction of any judgment that may be recovered by it in the case.
This was likewise granted by the court.

Private respondent Lily Yulo filed her answer with counterclaim, alleging that although Augusta Yulo and she are husband and wife,
the former had abandoned her and their children five (5) months before the filing of the complaint; that they were already separated
when the promissory note was executed; that her signature in the special power of attorney was forged because she had never
authorized Augusto Yulo in any capacity to transact any business for and in behalf of A & L Industries, which is owned by her as a
single proprietor, that she never got a single centavo from the proceeds of the loan mentioned in the promissory note; and that as a
result of the illegal attachment of her properties, which constituted the assets of the A & L Industries, the latter closed its business and
was taken over by the new owner.

After hearing, the trial court rendered judgment dismissing the petitioner's complaint against the private respondent Lily Yulo and A
& L Industries and ordering the petitioner to pay the respondent Lily Yulo P660,000.00 as actual damages; P500,000.00 as unrealized
profits; P300,000.00 as exemplary damages; P30,000.00 as and for attorney's fees; and to pay the costs.

The petitioner appealed. The Court of Appeals affirmed the trial court's decision except for the exemplary damages which it reduced
from P300,000.00 to P150,000.00 and the attorney's fees which were reduced from P30,000.00 to P20,000.00.

In resolving the question of whether or not the trial court erred in holding that the signature of respondent Lily Yulo in the special
power of attorney was forged, the Court of Appeals said:

The crucial issue to be determined is whether or not the signatures of the appellee Lily Yulo in Exhibits B and B-1 are forged.
Atty. Crispin Ordoña, the Notary Public, admitted in open court that the parties in the subject documents did not sign their
signatures in his presence. The same were already signed by the supposed parties and their supposed witnesses at the time
they were brought to him for ratification. We quote from the records the pertinent testimony of Atty. Ordoña, thus:

Q. This document marked as Exhibit B-1, when this was presented to you by that common friend, June
Enriquez, it was already typewritten, it was already accomplished, all typewritten.?

A. Yes, sir.

Q And the parties had already affixed their signatures in this document?

A. Yes, sir.

Q. In this document marked as Exhibit B although it appears here that this is an acknowledgment, you have
not stated here that the principal actually acknowledged this document to be her voluntary act and deed?

A This in one of those things that escaped my attention. Actually I have not gone over the second page. I
believed it was in order I signed it. (TSN pp. 13-14, Hearing of Nov. 26, 1976).

The glaring admission by the Notary Public that he failed to state in the acknowledgment portion of Exhibit B-1 that the
appellee Lily Yulo acknowledged the said document to be her own voluntary act and deed, is a very strong and commanding
circumstance to show that she did not appear personally before the said Notary Public and did not sign the document.

Additionally, the Notary Public admitted that, while June Enriquez is admittedly a mutual friend of his and the defendant
Augusta Yulo, and who is also an instrumental witness in said Exhibit B-1., he could not recognize or tell which of the two
signatures appearing therein, was the signature of this June Enriquez.

Furthermore, as the issue is one of credibility of a witness, the findings and conclusions of the trial court before whom said
witness, Atty. Crispin Ordoña, the Notary Public before whom the questioned document was supposedly ratified and
acknowledged, deserve great respect and are seldom disturbed on appeal by appellate tribunals, since it is in the best and
peculiar advantage of determining and observing the conduct, demeanor and deportment of a particular witness while he is
testifying in court, an opportunity not enjoyed by the appellate courts who merely have to rely on the recorded proceedings
which transpired in the court below, and the records are bare of any circumstance of weight, which the trial court had
overlooked and which if duly considered, may radically affect the outcome of the case.

On the other hand, the appellee Lily Yulo, to back up her claim of forgery of her signature in Exhibit B-1, presented in court
a handwriting expert witness in the person of Police Captain Yakal Giron of the Integrated National Police Training
Command, and who is also a Document Examiner of the same Command's Crime Laboratory at Fort Bonifacio, Metro
Manila. His experience as an examiner of questioned and disputed documents, in our mind, is quite impressive. To qualify
him as a handwriting expert, he declared that he underwent extensive and actual studies and examination of disputed or
questioned document, both at the National Bureau of Investigation Academy and National Bureau of Investigation
Questioned Document Laboratory, respectively, from July 1964, up to his appointment as Document Examiner in June, 1975,
and, to further his experience along this line, he attended the 297th Annual Conference of the American Society of
Questioned Docurnent Examiners held at Seattle, Washington, in August 1971, as a representative of the Philippines, and
likewise conducted an observation of the present and modern trends of crime laboratories in the West Coast, U.S.A., in 1971;
that he likewise had conducted actual tests and examination of about 100,000 documents, as requested by the different courts,
administrative, and governmental agencies of the Government, substantial portions of which relate to actual court cases.

In concluding that the signatures of the appellee Lily Yulo, in the disputed document in question (Exh. B-1), were all
forgeries, and not her genuine signature, the expert witness categorically recited and specified in open court what he observed
to be about twelve (12) glaring and material significant differences, in his comparison of the signatures appearing in the
genuine specimen signatures of the said appellee and with those appearing in the questioned document (Exhibit B-1). Indeed,
we have likewise seen the supposed notable differences, found in the standard or genuine signatures of the appellee which
were lifted and obtained in the official files of the government, such as the Bureau of Internal Revenue on her income tax
returns, as compared to the pretended signature of the appellee appearing in Exhibits B, B-1. It is also noteworthy to mention
that the appellant did not even bother to conduct a cross-examination of the handwriting expert witness, Capt. Giron, neither
did the appellant present another handwriting expert, at least to counter-act or balance the appellee's handwriting expert.

Prescinding from the foregoing facts, we subscribe fully to the lower court's observations that the signatures of the appellee
Lily Yulo in the questioned document (Exh. B-1) were forged. Hence, we find no factual basis to disagree. (pp. 28-30, Rollo)
As to the petitioner's contention that even if the signature of Lily Yulo was forged or even if the attached properties were her exclusive
property, the same can be made answerable to the obligation because the said properties form part of the conjugal partnership of the
spouses Yulo, the appellate court held that these contentions are without merit because there is strong preponderant evidence to show
that A & L Industries belongs exclusively to respondent Lily Yulo, namely: a) The Certificate of Registration of A & L Industries,
issued by the Bureau of Commerce, showing that said business is a single proprietorship, and that the registered owner thereof is only
Lily Yulo; b) The Mayor's Permit issued in favor of A & L Industries, by the Caloocan City Mayor's Office showing compliance by
said single proprietorship company with the City Ordinance governing business establishments; and c) The Special Power of Attorney
itself, assuming but without admitting its due execution, is tangible proof that Augusto Yulo has no interest whatsoever in the A & L
Industries, otherwise, there would have been no necessity for the Special Power of Attorney if he is a part owner of said single
proprietorship.

With regard to the award of damages, the Court of Appeals affirmed the findings of the trial court that there was bad faith on the part
of the petitioner as to entitle the private respondent to damages as shown not only by the fact that the petitioner did not present the
Deed of Assignment or the construction agreement or any evidence whatsoever to support its claim of fraud on the part of the private
respondent and to justify the issuance of a preliminary attachment, but also by the following findings:

Continuing and elaborating further on the appellant's mala fide actuations in securing the writ of attachment, the lower court
stated as follows:

Plaintiff not satisfied with the instant case where an order for attachment has already been issued and
enforced, on the strength of the same Promissory Note (Exhibit"A"), utilizing the Deed of Chattel
Mortgage (Exhibit "4"), filed a foreclosure proceedings before the Office of the Sheriff of Caloocan
(Exhibit"6") foreclosing the remaining properties found inside the premises formerly occupied by the A &
L Industries. A minute examination of Exhibit "4" will show that the contracting parties thereto, as
appearing in par. 1 thereof, are Augusto Yulo, doing business under the style of A & L Industries (should
be A & L Glass Industries Corporation), as mortgagor and BA Finance Corporation as mortgagee, thus the
enforcement of the Chattel Mortgage against the property of A & L Industries exclusively owned by Lily T.
Yulo appears to be without any factual or legal basis whatsoever. The chattel mortgage, Exhibit "4" and the
Promissory Note, Exhibit A, are based on one and the same obligation. Plaintiff tried to enforce as it did
enforce its claim into two different modes a single obligation.

Aware that defendant Lily Yulo, filed a Motion to Suspend Proceedings by virtue of a complaint she filed
with the Court of First Instance of Caloocan, seeking annulment of the Promissory Note, the very basis of
the plaintiff in filing this complaint, immediately after the day it filed a Motion for the Issuance of an Alias
Writ of Preliminary Attachment . . .Yet, inspite of the knowledge and the filing of this Motion to Suspend
Proceedings, the Plaintiff still filed a Motion for the Issuance of a Writ of Attachment dated February 6,
1976 before this court. To add insult to injury, plaintiff even filed a Motion for Examination of the
Attachment Debtor, although aware that Lily Yulo had already denied participation in the execution of
Exhibits "A" and "B". These incidents and actions taken by plaintiff, to the thinking of the court, are
sufficient to prove and establish the element of bad faith and malice on the part of plaintiff which may
warrant the award of damages in favor of defendant Lily Yulo. (Ibid., pp. 102-103).<äre||anº•1àw>

Indeed, the existence of evident bad faith on the appellant's part in proceeding against the appellee Lily
Yulo in the present case, may likewise be distressed on the fact that its officer Mr. Abraham Co, did not
even bother to demand the production of at least the duplicate original of the Special Power of Attorney
(Exhibit B) and merely contended himself with a mere xerox copy thereof, neither did he require a more
specific authority from the A & L Industries to contract the loan in question, since from the very content
and recitals of the disputed document, no authority, express or implied, has been delegated or granted to
August Yulo to contract a loan, especially with the appellant. (pp. 33-34, Rollo)

Concerning the actual damages, the appellate court ruled that the petitioner should have presented evidence to disprove or rebut the
private respondent's claim but it remained quiet and chose not to disturb the testimony and the evidence presented by the private
respondent to prove her claim.

In this petition for certiorari, the petitioner raises three issues. The first issue deals with the appellate court's affirmance of the trial
court's findings that the signature of the private respondent on the Special Power of Attorney was forged. According to the petitioner,
the Court of Appeals disregarded the direct mandate of Section 23, Rule 132 of the Rules of Court which states in part that evidence of
handwriting by comparison may be made "with writings admitted or treated as genuine by the party against whom the evidence is
offered, or proved to be genuine to the satisfaction of the judge," and that there is no evidence on record which proves or tends to
prove the genuineness of the standards used.
There is no merit in this contention.

The records show that the signatures which were used as "standards" for comparison with the alleged signature of the private
respondent in the Special Power of Attorney were those from the latter's residence certificates in the years 1973, 1974 and 1975, her
income tax returns for the years 1973 and 1975 and from a document on long bond paper dated May 18, 1977. Not only were the
signatures in the foregoing documents admitted by the private respondent as hers but most of the said documents were used by the
private respondent in her transactions with the government. As was held in the case of Plymouth Saving & Loan Assn. No. 2 v.
Kassing (125 NE 488, 494):

We believe the true rule deduced from the authorities to be that the genuineness of a "standard" writing may be
established (1) by the admission of the person sought to be charged with the disputed writing made at or for the
purposes of the trial or by his testimony; (2) by witnesses who saw the standards written or to whom or in whose
hearing the person sought to be charged acknowledged the writing thereof; (3) by evidence showing that the reputed
writer of the standard has acquiesced in or recognized the same, or that it has been adopted and acted upon by him
his business transactions or other concerns....

Furthermore, the judge found such signatures to be sufficient as standards. In the case of Taylor-Wharton Iron & Steel Co. v.
Earnshaw (156 N.E. 855, 856), it was held:

When a writing is offered as a standard of comparison it is for the presiding judge to decide whether it is the
handwriting of the party to be charged. Unless his finding is founded upon error of law, or upon evidence which is,
as matter of law, insufficient to justify the finding, this court will not revise it upon exceptions." (Costelo v. Crowell,
139 Mass. 588, 590, 2 N.E. 648; Nuñez v. Perry, 113 Mass, 274, 276.)

We cannot find any error on the part of the trial judge in using the above documents as standards and also in giving credence to the
expert witness presented by the private respondent whose testimony the petitioner failed to rebut and whose credibility it likewise
failed to impeach. But more important is the fact that the unrebutted handwriting expert's testimony noted twelve (12) glaring and
material differences in the alleged signature of the private respondent in the Special Power of Attorney as compared with the specimen
signatures, something which the appellate court also took into account. In Cesar v. Sandiganbayan (134 SCRA 105, 132), we ruled:

Mr. Maniwang pointed to other significant divergences and distinctive characteristics between the sample signatures
and the signatures on the questioned checks in his report which the court's Presiding Justice kept mentioning during
Maniwang's testimony.

In the course of his cross-examination, NBI expert Tabayoyong admitted that he saw the differences between the
exemplars used and the questioned signatures but he dismissed the differences because he did not consider them
fundamental. We rule that significant differences are more fundamental than a few similarities. A forger always
strives to master some similarities.

The second issue raised by the petitioner is that while it is true that A & L Industries is a single proprietorship and the registered
owner thereof is private respondent Lily Yulo, the said proprietorship was established during the marriage and its assets were also
acquired during the same. Therefore, it is presumed that this property forms part of the conjugal partnership of the spouses Augusto
and Lily Yulo and thus, could be held liable for the obligations contracted by Augusto Yulo, as administrator of the partnership.

There is no dispute that A & L Industries was established during the marriage of Augusta and Lily Yulo and therefore the same is
presumed conjugal and the fact that it was registered in the name of only one of the spouses does not destroy its conjugal nature (See
Mendoza v. Reyes, 124 SCRA 161, 165). However, for the said property to be held liable, the obligation contracted by the husband
must have redounded to the benefit of the conjugal partnership under Article 161 of the Civil Code. In the present case, the obligation
which the petitioner is seeking to enforce against the conjugal property managed by the private respondent Lily Yulo was undoubtedly
contracted by Augusto Yulo for his own benefit because at the time he incurred the obligation he had already abandoned his family
and had left their conjugal home. Worse, he made it appear that he was duly authorized by his wife in behalf of A & L Industries, to
procure such loan from the petitioner. Clearly, to make A & L Industries liable now for the said loan would be unjust and contrary to
the express provision of the Civil Code. As we have ruled in Luzon Surety Co., Inc. v. De Gracia (30 SCRA 111, 115-117):

As explained in the decision now under review: "It is true that the husband is the administrator of the conjugal
property pursuant to the provisions of Art. 163 of the new Civil Code. However, as such administrator the only
obligations incurred by the husband that are chargeable against the conjugal property are those incurred in the
legitimate pursuit of his career, profession or business with the honest belief that he is doing right for the benefit of
the family. This is not true in the case at bar for we believe that the husband in acting as guarantor or surety for
another in an indemnity agreement as that involved in this case did not act for the benefit of the conjugal
partnership. Such inference is more emphatic in this case, when no proof is presented that Vicente Garcia in acting
as surety or guarantor received consideration therefore, which may redound to the benefit of the conjugal
partnership.(Ibid, pp. 46-47).

xxx xxx xxx

xxx xxx xxx

In the most categorical language, a conjugal partnership under that provision is liable only for such "debts and
obligations contracted by the husband for the benefit of the conjugal partnership." There must be the requisite
showing then of some advantage which clearly accrued to the welfare of the spouses. There is none in this case.

xxx xxx xxx

Moreover, it would negate the plain object of the additional requirement in the present Civil Code that a debt
contracted by the husband to bind a conjugal partnership must redound to its benefit. That is still another provision
indicative of the solicitude and tender regard that the law manifests for the family as a unit. Its interest is paramount;
its welfare uppermost in the minds of the codifiers and legislators.

We, therefore, rule that the petitioner cannot enforce the obligation contracted by Augusto Yulo against his conjugal properties with
respondent Lily Yulo. Thus, it follows that the writ of attachment cannot issue against the said properties.

Finally, the third issue assails the award of actual damages according to the petitioner, both the lower court and the appellate court
overlooked the fact that the properties referred to are still subject to a levy on attachment. They are, therefore, still under custodia
legis and thus, the assailed decision should have included a declaration as to who is entitled to the attached properties and that
assuming arguendo that the attachment was erroneous, the lower court should have ordered the sheriff to return to the private
respondent the attached properties instead of condemning the petitioner to pay the value thereof by way of actual damages.

In the case of Lazatin v. Twaño (2 SCRA 842, 847), we ruled:

xxx xxx xxx

... It should be observed that Sec. 4 of Rule 59, does not prescribed the remedies available to the attachment
defendant in case of a wrongful attachment, but merely provides an action for recovery upon the bond, based on the
undertaking therein made and not upon the liability arising from a tortuous act, like the malicious suing out of an
attachment. Under the first, where malice is not essential, the attachment defendant, is entitled to recover only the
actual damages sustained by him by reason of the attachment. Under the second, where the attachment is
maliciously sued out, the damages recoverable may include a compensation for every injury to his credit, business or
feed (Tyler v. Mahoney, 168 NC 237, 84 SE 362; Pittsburg etc. 5 Wakefield, etc., 135 NC 73, 47 SE 234). ...

The question before us, therefore, is whether the attachment of the properties of A & L Industries was wrongful so as to entitle the
petitioner to actual damages only or whether the said attachment was made in bad faith and with malice to warrant the award of other
kinds of damages. Moreover, if the private respondent is entitled only to actual damages, was the court justified in ordering the
petitioner to pay for the value of the attached properties instead of ordering the return of the said properties to the private respondent
Yulo ?

Both the trial and appellate courts found that there was bad faith on the part of the petitioner in securing the writ of attachment. We do
not think so. "An attachment may be said to be wrongful when, for instance, the plaintiff has no cause of action, or that there is no true
ground therefore, or that the plaintiff has a sufficient security other than the property attached, which is tantamout to saying that the
plaintiff is not entitled to attachment because the requirements of entitling him to the writ are wanting. (7 C.J.S., 664)" (p. 48, Section
4, Rule 57, Francisco, Revised Rules of Court).

Although the petitioner failed to prove the ground relied upon for the issuance of the writ of attachment, this failure cannot be equated
with bad faith or malicious intent. The steps which were taken by the petitioner to ensure the security of its claim were premised, on
the firm belief that the properties involved could be made answerable for the unpaid obligation due it. There is no question that a loan
in the amount of P591,003.59 was borrowed from the bank.

We, thus, find that the petitioner is liable only for actual damages and not for exemplary damages and attorney's fees. Respondent Lily
Yulo has manifested before this Court that she no longer desires the return of the attached properties since the said attachment caused
her to close down the business. From that time she has become a mere employee of the new owner of the premises. She has grave
doubts as to the running condition of the attached machineries and equipments considering that the attachment was effected way back
in 1975. She states as a matter of fact that the petitioner has already caused the sale of the machineries for fear that they might be
destroyed due to prolonged litigation. We, therefore, deem it just and equitable to allow private respondent Lily Yulo to recover actual
damages based on the value of the attached properties as proven in the trial court, in the amount of P660,000.00. In turn, if there are
any remaining attached properties, they should be permanently released to herein petitioner.

We cannot, however, sustain the award of P500,000.00 representing unrealized profits because this amount was not proved or justified
before the trial court. The basis of the alleged unearned profits is too speculative and conjectural to show actual damages for a future
period. The private respondent failed to present reports on the average actual profits earned by her business and other evidence of
profitability which are necessary to prove her claim for the said amount (See G. A. Machineries, Inc. v. Yaptinchay, 126 SCRA 78,
88).

The judgment is therefore set aside insofar as it holds the petitioner liable for P500,000.00 actual damages representing unrealized
profits, P150,000.00 for exemplary damages and P20,000.00 for attorney's fees. As stated earlier, the attached properties, should be
released in favor of the petitioner.

WHEREFORE, the decision of the Court of Appeals is hereby SET ASIDE and the petitioner is ordered to pay the private respondent
Lily Yulo the amount of SIX HUNDRED SIXTY THOUSAND PESOS (P660,000.00) as actual damages. The remaining properties
subject of the attachment are ordered released in favor of the petitioner.

SO ORDERED.

Fernan (Chairman), Feliciano, Bidin and Cortes JJ., concur.


THIRD DIVISION

G.R. No. 102692 September 23, 1996

JOHNSON & JOHNSON (PHILS.), INC., petitioner,


vs.
COURT OF APPEALS and ALEJO M. VINLUAN, respondents.

PANGANIBAN, J.:

May a husband be held liable for the debts of his wife which were incurred without his consent and which did not benefit the conjugal
partnership? May a judgment declaring a wife solely liable, be executed upon conjugal property, over the objection of the husband?

These are the main questions raised in the instant petition for review on certiorari under Rule 45 of the Rules of Court which seeks
nullification of the Decision 1 in CA-G.R. SP No. 19178 of the Court of Appeals, 2 the dispositive portion of which reads:

WHEREFORE, in view of all the foregoing, the instant petition is hereby GRANTED, and the orders dated July 24, 1989 and
October 4, 1989 of the Regional Trial Court of Makati, Branch 137, in Civil Case No. 4186, as well as the notices of levy
issued by the Provincial Sheriff of Rizal dated February 8, 1989, are hereby declared null and void and set aside. No costs.

The Facts

This case was initiated in the trial court by a complaint 3 filed by petitioner against spouses Delilah A. Vinluan, owner of Vinluan
Enterprises, and her husband Capt. Alejo M. Vinluan (the private respondent before us), for collection of a sum of money with
damages, which was docketed as Civil Case No. 4186 and tried in the Regional Trial Court of Makati, Branch 137. 4 The respondent
appellate Court found the antecedent facts, to be as follows: 5

The plaintiff-respondent Johnson & Johnson (Phils.), Incorporated (hereinafter referred to as the corporation) is engaged in
the manufacturing and selling of various cosmetics, health, and body care products, as well as medical drugs. On several
occasions in the year 1982, the defendant, Delilah Vinluan, purchased products of the plaintiff-respondent corporation, as she
was also engaged in the business of retailing Johnson products, among others. The defendants, under the name and style of
"Vinluan Enterprises," thus incurred an obligation of Two Hundred Thirty-Five Thousand Eight Hundred Eighty Pesos and
Eighty-Nine (P235,880.89) Centavos, for which she issued seven (7) Philippine Banking Corporation checks of varying
amounts and due dates. When presented on their respective due dates, however, the checks given in payment of the obligation
bounced and were dishonored for having been drawn against insufficient funds.

Several demands thereafter for payment were to no avail, despite the accommodations given by the plaintiff-respondent
corporation by granting several extensions to the defendant spouses to settle the obligation. It was only on January 5, 1983
that the defendants made a partial payment of Five Thousand (P5,000.00) Pesos, thereby reducing their principal obligation
to P230,880.89. When no further payments were made to settle the obligation despite repeated demands, the plaintiff-
respondent corporation was constrained to file a complaint (Annex "A") on June 8, 1983 against defendant spouses Vinluan,
for collection of the principal obligation plus interest, with damages. Filed before the respondent Regional Trial Court of
Makati, Branch 137, it was docketed as Civil Case No. 4186.

After trial on the merits, on February 5, 1985, the respondent court rendered its Decision (Annex "C"), the dispositive portion
of which reads:

WHEREFORE, judgment is hereby rendered sentencing the defendant DELILAH A. VINLUAN


to pay plaintiff Johnson & Johnson (Phils.), Inc, the sum of P242,482.40 with interest and penalty
charges at the rate of 2% per month from 30 January 1983 until fully paid, and the sum of
P30,000.00 as attorney's fees, and to pay the costs.

Defendants' counterclaim is hereby dismissed for lack of sufficient merit.

In arriving at the sole liability of defendant Delilah A. Vinluan, the trial court found after "meticulous scrutiny and careful evaluation
of the evidence on record" that there was "no privity of contract, whether direct or indirect, between plaintiff and defendant-husband
regarding the obligations incurred by defendant-wife." According to the trial court, "(i)n fact, the acts performed, and the statements
made, by defendant-husband, and from which plaintiff derived the notion that said defendant is a co-owner of VINLUAN
ENTERPRISES, took place after the obligation involved in this action had been incurred or contracted by the defendant-wife, albeit
without the husband's knowledge or consent, as there was no allegation in the complaint that said obligations were incurred by
defendant-wife with her husband's consent, or that it was incurred for the benefit of the family. . . ." 6

The trial court also found that private respondent never intimated in his conversations or meetings with, or in any of his letters to,
petitioner that "he was a co-owner of VINLUAN ENTERPRISES, much less did he represent himself as such co-owner, to the
plaintiff and to plaintiff's counsel . . . ." When private respondent personally negotiated with petitioner and proposed a settlement of
the subject obligations, these actuations were not to be considered as admission of co-ownership of VINLUAN ENTERPRISES for
"(a)fter all, common sense and our inborn mores of conduct dictate that a husband must give aid and comfort to his distressed wife." 7
The trial court further held that the defendant spouses had sufficiently established that the defendant wife was sole owner of the
business venture, that the conjugal partnership never derived any benefit therefrom, and that the same closed due to continued losses.
In sum, the court a quo held that private respondent could not legally be held liable for the obligations contracted by the wife.

Thus, the court below issued a writ of execution 8 on February 3, 1989, directing the Provincial Sheriff of Rizal to execute the
judgment on
the properties of the defendant-wife. However, the two notices of levy on execution 9 issued on February 8, 1989 covered not only her
exclusive or paraphernal properties, but also the real and personal properties of the conjugal partnership of the spouses Vinluan. The
next day, her husband (herein private respondent) filed a third-party claim 10 seeking the lifting of the levy on the conjugal properties,
followed by another third-party claim reiterating the same demand with threat of possible lawsuit. Subsequently, petitioner corporation
filed a motion dated February 14, 1989 asking the court to fix the value of the properties levied upon by the sheriff. In response to the
third-party claims of private respondent, a comment and/or opposition dated March 6, 1989 was filed by petitioner.

Private respondent moved on July 1, 1989 to quash the levy on execution on the ground that the notices of levy on execution did not
conform to the final decision of the court and to the writ of execution. As expected, petitioner opposed the motion. On July 24, 1989,
the trial court issued the first assailed Order fixing the value of the levied personal properties at P300,000.00, and denying the third-
party claim and the motion to quash the levy on execution. Citing the last sentence of Article 117 11 of the Civil Code, the court a quo
ruled that: 12

Since Alejo Vinluan did not seek the intervention of the Court to air his objections in his wife's engaging in business, coupled
by the fact that he made several representations for the settlement of his wife's account, Alejo Vinluan's consent thereto
became evident. As such, even his own capital may be liable, together with the conjugal and paraphernal property (I Paras
363, 1987 ed., p. 6; Art. 6-10, Code of Commerce). Withal, Article 172 of the New Civil Code categorically declares that —

The wife cannot bind the conjugal partnership without the husband's consent, except in the cases
provided by law.

Granting arguendo that Alejo Vinluan did not give his consent, expressly or impliedly, the paraphernal and conjugal property
may still be held liable but not his capital (I Paras 363, 1978 ed.).

Petitioner's motion for reconsideration of the abovequoted first order (on the ground that it directly contravened the decision itself
which had already become final and executory) was denied via the second contested Order dated October 4, 1989, where the trial
court ruled: 13

The Court finds untenable movant-defendant's assertion that Art. 172 of the New Civil Code is not in point. The consent of
the husband is indeed vital in determining what properties shall be subsidiarily liable in the event the paraphernal properties
of Delilah Vinluan should turn out to be insufficient to cover the judgment debt, as fully explained in the Order dated 24 July
1989.

Art. 122 of the Family Code which party provides that —

Art. 122. The payment of personal debts contracted by the husband or the wife before or during the
marriage shall not be charged to the conjugal partnership except insofar as they redounded to the benefit of
the family.

xxx xxx xxx

is not applicable in that —


This Code (Family 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 laws (Art. 255, Family Code;
emphasis supplied).

Plaintiff (petitioner herein), having acquired a vested right prior to the effectivity of the Family Code, said code is not a
propos (sic). Even granting arguendo that the same is befitting, movant defendant failed to realize that although Delilah
Vinluan suffered losses in her legitimate business, the experience she has gained redounded to the benefit of the family, and
as such, the conjugal partnership must bear the indebtedness and losses (I Paras 464, 1981 ed.). Moreover, had the business
Delilah Vinluan engaged in been a success, all profits would have been considered conjugal; it is therefore but fair that the
risks of the business should be borne by the conjugal partnership (Miravite, Bar Review Materials in Commercial Law, 1986
ed., p. 89; J.N. Nolledo, Commercial Law Reviewer, 1986 ed., pp. 6, 7; U.P. Law Complex, Answers to Bar Questions In
Commercial Law, 1986 ed., pp. 174, 175; Vitug, Commercial Law Reviewer, 1984, ed., p. 5).

There is a wide-embracing oversight when movant-defendant asserted that to hold the conjugal partnership property liable for
the indebtedness incurred solely by his wife would in effect modify the Decision dated 5 Feb 1985 which is now final and
executory. As afore-discussed, the conjugal property is subsidiarily liable.

As indicated above, the private respondent elevated the matter to the respondent appellate Court, charging the trial court with grave
abuse of discretion for effectively reversing its own final judgment. The respondent Court upheld the private respondent in its now-
assailed Decision, and denied herein petitioner's subsequent motion for reconsideration. Thus, petitioner is now before us seeking
review under Rule 45.

The Issues

Petitioner raised the following "issues of law" for consideration of this Court, to wit: 14

1. Whether or not the decision of the honorable trial court dated February 5, 1985 exonerating (sic) defendant husband,
private respondent herein, from the obligation contracted by the wife in the pursuit of her business also absolves the conjugal
partnership from liability.

2. Whether or not the subsequent order of the honorable trial court dated July 24, 1989 and October 4, 1989 is a reversal of its
own original decision as found out by the honorable public respondent.

The pivotal issues in this case may be re-stated thus: whether or not the order of the trial court denying private respondent's third-party
claim and motion to quash levy on execution in effect amended the dispositive portion of the trial court's decision which had long
become final and executory, and if so, whether same is proper or not. These issues shall be ruled upon together.

The Court's Ruling

Petitioner contends 15 that the purpose of impleading private respondent as co-defendant in petitioner's complaint was to bind not only
the defendant-spouses' conjugal partnership but also private respondent's capital. The trial court resolved that it was not necessary that
private respondent (as husband) be joined as party-defendant in the suit below. Inasmuch as it appeared from the allegations in the
complaint that private respondent may be a co-owner of Vinluan Enterprises, the trial court nonetheless did not exclude private
respondent but passed upon the issue of such co-ownership to determine whether he may be held liable in the same manner as his
wife. Petitioner insists that the trial court in its decision merely made a finding that the private respondent husband was not a co-owner
of the business venture of his wife, which conclusion ("exoneration") only exempted his capital from the adjudged liability, but not the
conjugal properties of the spouses. Petitioner further argues that nowhere in the trial court's decision can there be found any
pronouncement absolving the conjugal property from liability, contrary to the findings of the respondent Court.

Also, petitioner reasons that the enforcement of the decision against the conjugal property is merely compliance with law, and that this
Court in a long line of cases 16 held that a judgment is not confined to what appears upon the face of the decision but also those
necessarily included therein or necessary thereto. 17 Additionally, petitioner pleads that the trial court's order did not modify its final
and executory decision but only clarified an ambiguity in the decision as to what properties are liable. As authority, it cites Republic
vs. De los Angeles. 18

Petitioner's contentions are devoid of merit.


Respondent Court correctly ruled that the trial court cannot, in the guise of deciding the third-party claim, reverse its final decision.
Commenting on the trial court's very patent "about-face" on the issues of consent of the husband, benefit to the family, and the
husband's liability for obligations contracted by his wife, the appellate Court held, and we quote: 19

We see in these stark contradictions an attempt by the respondent Court to reverse itself, even when the decision sought to be
executed had already become final. The respondent Court has no authority to modify or vary the terms and conditions of a
final and executory judgment (Vda. de Nabong vs. Sadang, 167 SCRA 232) and this attempt to thwart the rules cannot be
allowed to pass. Even if the respondent Court feels that it needed to reverse its findings to correct itself, the decision, whether
erroneous or not, has become the law of the case between the parties upon attaining finality (Balais vs. Balais, 159 SCRA
37). the respondent Court has no choice but to order the execution of the final decision according to what is ordained and
decreed in the dispositive portion of the decision (National Steel Corp. vs. NLRC, 165 SCRA 452).

The dispositive portion of the decision charges the defendant Delilah Vinluan alone to pay the plaintiff corporation, having
already declared that the defendant-husband cannot be held legally liable for his wife's obligations. Perhaps, when it was later
discovered that the defendant Delilah Vinluan did not have sufficient property of her own to settle the obligation, the
conjugal properties of the defendant-spouses became the object of the levy. But in order to bind the conjugal partnership and
its properties, the New Civil Code provides that the debts and obligations contracted by the husband (or the wife) must be for
the benefit of the conjugal partnership (Article 161, par. 1); and that the husband must consent to his wife's engaging in
business (Article 117).

Thus, we see a belated effort on the part of the respondent Court to reverse itself by declaring that the obligations incurred by
the defendant wife redounded to the benefit of the family and that the defendant husband had given his consent, in order to
bind the conjugal partnership.

As We stated earlier, this cannot be done because the decision, along with the respondent Court's original findings, had
already become final and indisputable. The respondent Court already found that the defendant husband did not give his
consent; neither did the obligation incurred by the defendant wife redound to the benefit of the family. Hence, the conjugal
partnership, as well as the defendant husband, cannot be held liable. As originally decreed by the Court, only the defendant
wife and her paraphernal property can be held liable. Since the power of the court in execution of judgments extends only to
properties unquestionably belonging to the judgment debtor alone (Republic vs. Enriquez, 166 SCRA 608), the conjugal
properties and the capital of the defendant husband cannot be levied upon.

The settled rule is that a judgment which has acquired finality becomes immutable and unalterable, and hence may no longer be
modified in any respect except only to correct clerical errors or mistakes — all the issues between the parties being deemed resolved
and laid to rest. 20 This is meant to preserve the stability of decisions rendered by the courts, and to dissuade parties from trifling with
court processes. One who has submitted his case to a regular court necessarily commits himself to abide by whatever decision the
court may render. Any error in the decision which has not been considered in a timely motion for reconsideration or appeal cannot be
impugned when such error becomes apparent only during execution. This rule applies with more force in the case of to decision judge
who has limited prerogative during execution of the judgment. For as correctly held by herein public respondent, aside from ordering
the enforcement of the dispositive portion of the decision, the trial judge can do nothing about the errors in the ratiocination of the
decision or even alter the dispositive portion by mere order issued subsequent to the finality of the decision. The issue having been
laid to rest, the court cannot on the pretext of determining the validity of the third-party claim and the motion to quash levy on
execution alter the scope of the dispositive portion of the decision sought to be implemented.

Petitioner's arguments notwithstanding, the trial court's order cannot be said to be merely clarificatory in nature. There is no ambiguity
at all in the decision, for it categorically declared defendant Delilah A. Vinluan solely liable, without any recourse provided against
her husband. Thus, the case of Republic vs. Delos Angeles, 21 holding that doubtful or ambiguous judgments are to have a reasonable
intendment to do justice and avoid wrong, does not apply here. as was later held in Filinvest Credit Corporation vs. Court of Appeals,
22
"(w)here there is an ambiguity, a judgment shall be read in connection with the entire record and construed accordingly. In such a
case, it is proper to consider the pleadings and the evidence." (Emphasis supplied). But the text of the trial court's decision points to no
other person liable but Delilah Vinluan, and in fact made a rather lengthy discussion on the exemption from liability of the conjugal
partnership; hence, there can be no ambiguity to speak of in the decision. And even more clearly, the body of the decision of the trial
court expressly exempted private respondent from liability by categorically ruling that "the defendant-husband cannot, together, with
co-defendant, legally be held liable for the obligations contracted by the wife." 23 Further, the trial court expounded: 24

. . . . What is more, it is an admitted fact that the subject obligations had partially been paid by the defendant-wife herself.
Thus, plaintiff implicitly averred that "defendant Delilah Vinluan, ding business under the name and style of VINLUAN
ENTERPRISES is one of the various customers of the plaintiff's products' (Cf. p. 1, Plaintiff's Pre-Trial Brief); that "Delilah
Vinluan . . . purchased different Johnson products . . . , thus incurring an obligation of P235,880.89" (Cf. par. III, Complaint);
that "defendant Delilah Vinluan tried to pay (her) obligations . . . when she issued Philippine Banking Checks . . . , but which
checks upon presentment to the Bank were dishonored for the reason "Drawn Against Insufficient Funds" (Cf. par. V, id.);
that " . . . , defendant Delilah A. Vinluan appealed to the company and also represented that she be given an opportunity to
settle the accountability" (Cf. par. VI, id.); that "defendant sent a letter to the company where she alleged that payment cannot
be made because they are "victims of some bad practices in the trade and that they are working on some means to settle their
accounts and all that they ask is time to settle." (Cf. par. VI, id.).

We take this occasion to reiterate the ruling of this Court in an early


case 25 that litigations must end and terminate sometime and somewhere, it being essential to the effective and efficient administration
of justice that once a judgment has become final, the winning party be not, through a mere subterfuge, deprived of the fruits of the
verdict. Hence, courts must guard against any scheme calculated to bring about that result, for, constituted as they are to put an end to
controversies, courts should frown upon any attempt to prolong them. Furthermore, public policy and sound practice demand that at
the risk of occasional errors, judgments of courts should become final and irrevocable at some definite date fixed by law. And this is
better observed if the court executing the judgment would refrain from creating further controversy by effectively modifying and
altering the dispositive portion of the decision, thus further delaying the satisfaction of the judgment. No matter how just the intention
of the trial court, it cannot legally reverse what has already been settled. Holding the conjugal partnership liable in the order after the
finality of the decision is evidently not just correcting a mere clerical error; it goes into the merits of the case. And this is prohibited by
the rules and jurisprudence.

We have elsewhere ruled that "should judgment of lower courts — which may normally be subject to review by higher tribunals —
become final and executory before, or without, exhaustion of all recourse of appeal, they, too, become inviolable, impervious to
modification. They may, then, no longer be reviewed, or in any way modified directly or indirectly, by a higher court, not even by the
Supreme Court, much less by any other official, branch or department of Government." 26

. . . (N)othing is more settled in the law than that when a final judgment becomes executory, it thereby becomes immutable
and unalterable. The judgment may no longer be modified in any respect, even if the modification is meant to correct what is
perceived to be an erroneous conclusion of fact or law, and regardless of whether the modification is attempted to be made by
the Court rendering it or by the highest Court of land. They only recognized exceptions are the correction of clerical errors or
the making of so-called nunc pro tunc entries which cause no prejudice to any party, and, of course, where the judgment is
void.

Furthermore, "(a)ny amendment or alteration which substantially affects a final and executory judgment is null and void for
lack of jurisdiction, including the entire proceedings held for that purpose." 27

The respondent Court also commented on the sheriff's actuations as follows: 28

Furthermore, it is the duty of the sheriff to ensure that only that portion of the decision ordained and decreed in the
dispositive part should be the subject of the execution (Cunanan vs. Cruz, 167 SCRA 674). The writ of execution itself states
that only the properties of the defendant wife were to be levied upon. There was no mention even of conjugal properties.
Hence, in levying on the properties that did not exclusively belong to the judgment debtor, the notices of levy failed to
conform to the decree of the decision, and are, therefore, irregular and contrary to the Rules (Canlas vs. CA, 164 SCRA 160).

It is a rule firmly established in our jurisprudence that a sheriff is not authorized to attach or levy on property not belonging to the
judgment debtor. 29 A sheriff even incurs liability if he wrongfully levies upon the property of a third person. 30 A sheriff has no
authority to attach the property of any person under execution except that of the judgment debtor. The sheriff maybe liable for
enforcing execution on property belonging to a third party. 31 If he does so, the writ of execution affords him no justification, for the
action is not in obedience to the mandate of the writ.

WHEREFORE, in view of the foregoing considerations, the herein petition is hereby DENIED, and the Decision of the respondent
Court is AFFIRMED. Costs against petitioner.

SO ORDERED.

Narvasa, C.J., Davide, Jr., Melo and Francisco, JJ., concur.

Footnotes

"Art. 117. The wife may exercise any profession or occupation or engage in business. However, the husband may object, provided:

(1) His income is sufficient for the family, according to its social standing, and
(2) His opposition is founded on serious and valid grounds.

In case of disagreement on this question, the parents and grandparents as well as the family council, if any, shall be consulted. If no agreement is still arrived at, the
court will decide whatever may be proper and in the best interest of the family.

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