Letter to a Lawyer

Dear Attorney,

I am currently in the process of purchasing a condominium from a married couple. However, I have noticed that only the husband's name appears on the property title, while his wife is not listed as a co-owner. Given that they are legally married, I am concerned about potential complications or legal implications regarding the transaction. Could this affect the legitimacy of the sale or cause any issues later on?

I would appreciate your legal advice on how best to proceed and whether there are specific steps that should be taken to ensure the purchase is valid and protected under Philippine law.

Thank you for your assistance.

Sincerely,
A Concerned Condo Buyer

Legal Analysis: Understanding the Implications of Purchasing Property Owned by a Married Couple with Only the Husband's Name on the Title

Under Philippine law, buying a property where only one spouse’s name appears on the title, particularly when the couple is legally married, raises important legal questions that need to be fully understood. This situation touches upon several areas of Philippine family law, property law, and civil law, particularly the rules surrounding marital property regimes, the concept of conjugal or community property, and the formalities of property transactions.

Marital Property Regimes in the Philippines

In the Philippines, the property relationship between spouses is governed by what is known as the marital property regime. There are three general types of property regimes:

Absolute Community of Property (ACP) – This is the default regime for marriages celebrated after August 3, 1988, under the Family Code of the Philippines. All properties owned by either spouse before the marriage, and all properties acquired during the marriage, become part of the community property, unless otherwise specified by law (such as through inheritance, donations, or prenuptial agreements).
Conjugal Partnership of Gains (CPG) – This regime applies to marriages that took place before the Family Code came into effect (i.e., before August 3, 1988) unless the couple opted for ACP under a marriage settlement. In this regime, only the fruits or income from property acquired by either spouse during the marriage are shared, while their pre-marriage properties remain separate.
Complete Separation of Property (CSP) – This regime applies only if the spouses expressly agreed upon it before marriage, typically through a marriage settlement (prenuptial agreement). In this case, the spouses retain separate ownership of their respective properties.

To determine how the sale of a condominium, with only the husband's name on the title, will affect the buyer, it is crucial to first ascertain which property regime governs the couple’s marriage.

1. Absolute Community of Property (ACP)

If the couple is married under ACP, which is the default property regime for marriages after the effectivity of the Family Code, then the condo is presumed to be part of the community property. Regardless of the fact that only the husband’s name is on the title, the law presumes that the condo belongs to both the husband and the wife.

In an ACP regime, all properties acquired during the marriage, except those expressly excluded, are jointly owned by the spouses. The spouses share equal rights to these properties, and both spouses must consent to the sale of the property. This means that even if only the husband's name is on the title, the wife’s consent is still necessary for the sale to proceed legally.

Without the wife’s consent, the transaction could be voidable, leaving the buyer in a precarious situation. A lack of the spouse’s consent may result in legal challenges that could invalidate the sale later on, or in the worst-case scenario, lead to legal disputes over ownership rights.

Examples and Relevant Case Law:

In Lim v. Court of Appeals (G.R. No. 131742, January 20, 2000), the Supreme Court ruled that the lack of the spouse’s consent in the sale of a conjugal property renders the contract voidable. This highlights the importance of ensuring both spouses’ participation in property transactions under an ACP regime.
Furthermore, in Gabriel v. Mateo (G.R. No. 172980, January 20, 2009), the Court reiterated that even if a property is registered solely in one spouse's name, both spouses must still consent to its alienation if it falls under ACP.

2. Conjugal Partnership of Gains (CPG)

If the couple were married before the Family Code and their property regime is governed by CPG, the situation is slightly different but still requires caution. Under CPG, properties acquired during the marriage through the labor or industry of either or both spouses are considered conjugal properties. The property in question would be conjugal, and the wife’s consent would still be needed for its valid sale.

However, properties acquired by either spouse before the marriage are considered exclusive property of that spouse unless proven otherwise. In this case, if the husband acquired the condo before the marriage, the property would be his exclusive property, and he would not need the wife’s consent for the sale. This, however, must be supported by clear proof, such as the date of acquisition being prior to the marriage or evidence of separate ownership.

Examples and Relevant Case Law:

In Buenaventura v. Court of Appeals (G.R. No. 127856, July 28, 1999), the Court clarified the distinction between properties acquired before and during the marriage under the CPG regime. Even if a property is registered in the name of one spouse, it is presumed to be conjugal if acquired during the marriage, and both spouses’ consent is required for its disposition.
The Supreme Court has also clarified that in cases where a property was acquired before marriage, it is considered separate property, and only the spouse who owns it has the right to dispose of it without the other spouse’s consent.

3. Complete Separation of Property (CSP)

If the spouses have agreed to a regime of complete separation of property, the rules are more straightforward. In this case, the property belongs exclusively to the spouse whose name is on the title, and the other spouse has no right to it. Thus, the husband would be able to sell the condo without the wife’s consent or involvement.

However, for this regime to apply, there must be a valid marriage settlement or prenuptial agreement stipulating the separation of property. It is important to verify whether such an agreement exists before proceeding with the transaction. If there is no prenuptial agreement, the default property regime would apply.

Formalities of the Sale: Ensuring a Legally Valid Transaction

Regardless of the marital property regime, certain formalities must be observed to ensure that the sale is legally valid:

Title Verification: The buyer should conduct due diligence by verifying the Certificate of Title at the Registry of Deeds. This will ensure that there are no liens, encumbrances, or adverse claims against the property. It will also confirm the ownership status and whether the husband alone holds the title or if the title is co-owned.
Spousal Consent: In ACP and CPG regimes, the buyer must obtain the wife’s written consent to avoid future disputes. This consent should be reflected in a Deed of Sale, where both the husband and wife are parties to the transaction. The wife’s consent is an essential formality, without which the sale may be rendered voidable.
Notarization: The Deed of Sale must be notarized to make it a public document, which is necessary for its registration with the Registry of Deeds. The lack of notarization may not only affect the validity of the sale but also hinder the buyer’s ability to register the property in their name.
Capital Gains Tax and Documentary Stamp Tax: The sale of the condominium will be subject to capital gains tax (6% of the selling price or the zonal value, whichever is higher) and documentary stamp tax (1.5% of the selling price or the zonal value). These taxes must be paid before the transfer of the property is registered.

Conclusion: How to Safeguard Your Purchase

In conclusion, purchasing a condominium from a married couple where only the husband's name is on the title requires a thorough understanding of Philippine property and family law. The marital property regime governing the couple’s marriage is key to determining whether the sale can proceed smoothly or whether additional steps (such as securing the wife’s consent) are necessary.

The buyer must exercise due diligence by confirming the couple’s marital property regime, verifying the title, and ensuring compliance with all legal formalities, including obtaining spousal consent where applicable. By following these steps, the buyer can protect themselves from potential legal issues and secure the property in a manner consistent with Philippine law.