Absolute Community of Property Regime | Different Property Regimes | Property Relations Between the Spouses | Marriage | FAMILY CODE

The Absolute Community of Property (ACP) Regime under the Family Code of the Philippines is one of the default property relations between spouses unless they stipulate otherwise through a prenuptial agreement. Under the ACP, all properties owned by each spouse before the marriage, along with those acquired thereafter, are considered jointly owned by both spouses from the time of marriage. Below, I’ll provide a detailed examination of the ACP regime, covering its legal basis, composition, administration, liabilities, and termination.

Legal Basis

The ACP is provided for under the Family Code of the Philippines, specifically in Articles 75 to 144, covering general provisions, properties included in the ACP, rules on administration, as well as grounds for the termination of this regime. By default, the ACP applies to couples married without a prenuptial agreement or those married under the Family Code’s regime.

1. Properties Included in the Absolute Community of Property

Under the ACP, all properties owned by either spouse at the time of the marriage or acquired thereafter become common property unless otherwise excluded by law or prenuptial agreement.

A. Properties Included in the ACP

  1. Properties Owned Prior to Marriage:

    • All properties owned by either spouse before the marriage are included in the ACP, even if they were individually acquired.
    • This includes real properties, personal properties, and other forms of assets.

  2. Properties Acquired During the Marriage:

    • All properties acquired by either or both spouses during the marriage, including earnings, inheritances, and gifts (with certain exceptions noted below).

  3. Income from Properties:

    • Income, fruits, and interest from properties owned by either spouse prior to the marriage are considered community property.

B. Exceptions: Properties Excluded from ACP

Certain properties are excluded from the ACP under Article 92 of the Family Code, such as:

  1. Properties Acquired by Gratuitous Title (Inheritance or Donation):
    • Properties inherited or donated to one spouse alone remain his or her exclusive property if specified by the donor, testator, or grantor.
  2. Personal Properties for Personal Use:
    • Clothes, personal items, and accessories, excluding luxury items, remain under personal ownership.
  3. Property Acquired Before the Marriage with a Legitimate Condition:
    • If a property owned prior to marriage has a condition imposed by a third party (such as inheritance to specific heirs), it will not be part of the ACP.

2. Administration of the Absolute Community of Property

The administration of the ACP is governed by Articles 96 to 98 of the Family Code.

  1. Joint Administration:

    • Both spouses are co-administrators of the ACP. In cases where they disagree, the decision of the husband prevails, subject to recourse in court by the wife if she believes the decision is detrimental to the family.

  2. Consent Requirement for Disposition of Community Property:

    • Neither spouse may dispose of, mortgage, encumber, or lease community property without the consent of the other.
    • Transactions undertaken without the other spouse’s consent may be void or voidable, depending on the circumstances.

  3. Exceptional Administration Rights:

    • In cases where one spouse is incapacitated, absent, or cannot act, the other spouse may proceed with administration but must secure court authorization for certain transactions.

3. Liabilities in the Absolute Community of Property

The ACP is liable for certain obligations, which can be classified into family, personal, and business-related liabilities. These are outlined in Articles 94 and 95 of the Family Code.

  1. Family Expenses and Debts:

    • Expenses for the family’s basic needs, education, and support.
    • Debts and obligations incurred for the benefit of the community, including maintenance and medical expenses.

  2. Expenses Related to the Acquisition of Properties:

    • Expenses related to properties acquired before and during the marriage that now belong to the ACP.

  3. Personal Debts of a Spouse:

    • Debts and obligations incurred by one spouse before the marriage are generally his or her responsibility alone, not chargeable to the ACP.
    • Debts arising from one spouse’s separate and personal undertakings may also not be charged to the ACP unless they were for the family’s benefit or with the other spouse’s consent.

  4. Liability for Criminal Penalties or Civil Liabilities:

    • If a spouse incurs a criminal penalty or civil liability from an act not benefiting the family, the community property shall not be liable for payment, unless consent from the other spouse or benefit to the family can be proven.

4. Termination of the Absolute Community of Property

The ACP terminates in instances specified under Article 99, upon which liquidation of the assets will be done to determine each spouse's share.

Grounds for Termination:

  1. Death of a Spouse:

    • The ACP terminates upon the death of a spouse, leading to liquidation and settlement of the estate.

  2. Legal Separation:

    • In cases of legal separation, annulment, or nullity of marriage, the ACP regime ends, subject to property division and court ruling.

  3. Judicial Separation of Property:

    • Either spouse may petition the court for separation of property for a valid reason, such as abandonment, judicial orders, or other circumstances that justify independent administration of the property.

  4. Change to a Different Property Regime:

    • The spouses may agree to change their property regime, subject to judicial approval and proper justifications, such as for economic benefit or specific family needs.

Effect of Termination and Liquidation:

  • Upon termination, all debts and obligations of the community are settled before dividing the net assets between the spouses.
  • The remaining properties are divided equally between the spouses or heirs in cases of death, subject to legitimate claims or improvements brought to certain properties.

5. Special Provisions

Special cases affect the ACP, such as cases of remarriage or separation, which are covered under Articles 125 to 144. Notably, remarriage may involve special rules for ACP, requiring liquidation of properties and protection of previous and current rights.

  1. Effects of Remarriage on Property Relations:

    • A subsequent marriage must follow liquidation of prior ACP properties before entering into another ACP with a new spouse.

  2. Protection of Family Home:

    • The family home is generally exempt from forced sale or foreclosure, protecting the welfare of minor children and other dependents.

Conclusion

The ACP regime underscores the principle of shared ownership between spouses in the Philippines. It supports family unity and equitable sharing by pooling all properties into a common fund managed jointly. However, it also imposes specific limitations to protect individual and family interests, offering both structure and flexibility in managing family assets. Spouses can navigate their rights, responsibilities, and choices within this legal framework, with recourse to the court when disputes arise.

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