WHAT IS ABSOLUTE COMMUNITY OF PROPERTY IN PHILIPPINE FAMILY LAW

The system of Absolute Community of property is a system of property relation that treats properties acquired by the spouses during their marriage as jointly-owned. It consists of all the properties owned by the spouses at the time of the celebration of the marriage or acquired thereafter unless the property involved is expressly excluded by an existing marriage settlement or by the provisions of the Philippine Family Law.

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The System of Absolute Community of property is considered as the default property regime of the spouses. In the absence of a marriage settlement or if one is considered void, the law itself prescribes such as the operative property system within the marriage. Under the Family Code, the system of Absolute Community of property commences at the precise moment the marriage is celebrated and any stipulation allowing for the commencement of such system at a later time shall be considered as void. The rules governing co-ownership shall apply in all matters not provided for in the Family Code.

In order to protect third persons such as creditors, the law prohibits a spouse from making a waiver of interest over his or her share in the community property except in the case of judicial separation of property. In the event that a judicial separation of property occurs or when the marriage is dissolved or annulled, any waiver must appear in a public instrument and shall be registered in the local civil registry where the marriage contract is recorded as well in the proper registries of property.

The Absolute Community of property encompasses all the properties each spouse owns at the time of the marriage and thereafter. Certain properties however are excluded as determined by Philippine Family Law. These properties are as follows:

  1. Property acquired during the marriage by gratuitous title by either spouse, and the fruits as well as the income thereof, if any, unless it is expressly provided by the donor, testator or grantor that they shall form part of the community property;
  2. Property for personal and exclusive use of either spouse. However, jewelry shall form part of the community property;
  3. Property acquired before the marriage by either spouse who has legitimate descendants by a former marriage, and the fruits as well as the income, if any, of such property.

Notice should be taken that the law presumes a property acquired during marriage as part of the community unless it can be proved that such property is one of those excluded.

As a rule, the absolute community of property shall answer for the following charges and debts:

  1. The support of the spouses, their common children, and legitimate children of either spouse; however, the support of illegitimate children shall be governed by the provisions of this Code on Support;
  2. All debts and obligations contracted during the marriage by the designated administrator-spouse for the benefit of the community, or by both spouses, or by one spouse with the consent of the other;
  3. Debts and obligations contracted by either spouse without the consent of the other to the extent that the family may have been benefited;
  4. All taxes, liens, charges and expenses, including major or minor repairs, upon the community property;
  5. All taxes and expenses for mere preservation made during marriage upon the separate property of either spouse used by the family;
  6. Expenses to enable either spouse to commence or complete a professional or vocational course, or other activity for self-improvement;
  7. Ante-nuptial debts of either spouse insofar as they have redounded to the benefit of the family;
  8. The value of what is donated or promised by both spouses in favor of their common legitimate children for the exclusive purpose of commencing or completing a professional or vocational course or other activity for self-improvement;
  9. Ante-nuptial debts of either spouse other than those falling under paragraph (7) of this Article, the support of illegitimate children of either spouse, and liabilities incurred by either spouse by reason of a crime or a quasi-delict, in case of absence or insufficiency of the exclusive property of the debtor-spouse, the payment of which shall be considered as advances to be deducted from the share of the debtor-spouse upon liquidation of the community; and
  10. Expenses of litigation between the spouses unless the suit is found to be groundless.

In the event that the community property is not sufficient to cover all such claims, the spouses shall be solidarily liable for the unpaid balance with their separate properties except for those debts falling under paragraph (9).

Both spouses shall possess joint administration and enjoyment of the community property.  In case of disagreement, the husband’s decision shall prevail subject to proper recourse by the wife to the courts for proper remedy. This action on the part of the latter must be commenced within 5 years from the date of the contract implementing such. One of the spouses may assume sole administration and exercise powers of administration if the other spouse is incapacitated or is unable to participate in the administration of the property. Such power does not confer to the administrator the authority to dispose or encumber the properties administered unless allowed to by the court or consented to by the other spouse. In the absence of such consent, the disposition or encumbrance shall be considered void but the transaction shall be construed as a continuing offer on the part of the consenting spouse and the third party that may still be perfected upon the acceptance by the other spouse or upon authorization of the court. Neither spouse may donate any community property without the consent of the other except in the case of moderate donations for charity or on occasion of family rejoicing or family distress.

As stated in the Philippine Family Law, the absolute community is terminated upon the happening of the following:

  1. Upon the death of either spouse;
  2. When there is a decree of legal separation;
  3. When the marriage is annulled or declared void; or
  4. In case of judicial separation of property during the marriage

In case the community property is dissolved, the following procedure shall take place. First, an inventory shall be made listing separately the properties that are included and excluded from the community property. Second, the debts and obligations of the absolute community shall be paid out of its assets. Third, whatever remains of the exclusive properties of the spouses shall thereafter be delivered to each of them. Fourth, the net assets shall be divided equally between husband and wife unless a different proportion or division was agreed upon in the marriage settlements or if there has been a voluntary waiver of such share as provided under the law. Fifth, the presumptive legitimes of the common children shall be delivered. Sixth, the conjugal dwelling and the lot on which it is situated shall be adjudicated to the spouse with whom the majority of the common children choose to remain unless otherwise agreed upon by the parties. Children below the age of seven years are deemed to have chosen the mother, unless the court has otherwise decided.

If no judicial settlement proceeding is instituted, the surviving spouse shall liquidate the community property either judicially or extra-judicially within six months from the death of the deceased spouse. If no liquidation is made upon the lapse of the six months period, any disposition or encumbrance involving the community property of the previous marriage shall be void. Should the surviving spouse contract a subsequent marriage without compliance with the previous requirements, a mandatory regime of complete separation of property shall be imposed upon the property relations of the subsequent marriage.

Source: Manila Legal Website