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Abalos vs. Macatangay, G.R. No. 155043, September 30, 2004

---- Article 69 regarding ownership, administration, enjoyment and disposition of the community

properties

FACTS: Spouses Arturo and Esther Abalos are the registered owners of a parcel of land withimprovements located at Azucena St., Makati City, covered by Transfer Certificate of Title (TCT) No.145316 of the Registry of Deeds of Makati. Arturo executed a Receipt and Memorandum of Agreement(RMOA), in favor for the respondent, binding himself to sell to respondent the subject property and not

to offer the same to any other party within 30 days from date.

Respondent sent a letter to Arturo and Esther informing them of his readiness and willingness to pay thefull amount of the purchase price and demanded upon the spouses to comply with their obligation toturn over possession of the property to him. Esther agreed to surrender possession of the property torespondent within 20 days, while the latter promised to pay the balance of the purchase price for P1,290, 000.00 after being placed in possession of the property. Esther also obligated herself to execute

and deliver to respondent a deed of absolute sale upon full payment.

Respondent informed the spouses that he had set aside P1, 290, 000.00 as evidenced by Citibank CheckNo. 278107 as full payment of the purchase price. But Arturo and Esther failed to deliver the propertywhich prompted respondent to file a complaint for specific performance with damages againstpetitioners.

RULING: Contracts, in general, require the presence of three essential elements: (1) consent of thecontracting parties; (2) object certain which is the subject matter of the contract; and (3) cause of theobligation which is established.

The nullity of the RMOA as a contract of sale emanates not only from lack of Esthers consent theretobut also from want of consideration and absence of respondents signature thereon. This cannot beobli terated by Esthers subsequent confirmation of the putative transaction as expressed in the Contractto Sell. Under the law, a void contract cannot be ratified and the action or defense for the declaration of the inexistence of a contract does not prescribe. A void contract produces no effect either against or in

favor of anyone it cannot create, modify or extinguish the juridical relation to which it refers.

The congruence of the wills of the spouses is essential for the valid disposition of conjugal property.Where the conveyance is contained in the same document which bears the conformity of both husbandand wife, there could be no question on the validity of the transaction. But when there are 2 documentson which the signatures of the spouses separately appear, textual concordance of the documents is

indispensable. Hence, in this case where the wifes putative consent to the sale of conjugal property

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appears in a separate document which does not, however, contain the same terms and conditions as in

the first document signed by the husband, a valid transaction could not have arisen.

The interest of each spouse is limited to the net remainder or "remanente liquido" (haber ganancial)resulting from the liquidation of the affairs of the partnership after its dissolution. Thus, the right of the

husband or wife to one-half of the conjugal assets does not vest until the dissolution and liquidation of the conjugal partnership, or after dissolution of the marriage.

Significantly, the Family Code has introduced some changes particularly on the aspect of theadministration of the conjugal partnership. The new law provides that the administration of the conjugal

partnership is now a joint undertaking of the husband and the wife. In the event that one spouse isincapacitated or otherwise unable to participate in the administration of the conjugal partnership, theother spouse may assume sole powers of administration. However, the power of administration doesnot include the power to dispose or encumber property belonging to the conjugal partnership. In allinstances, the present law specifically requires the written consent of the other spouse, or authority of the court for the disposition or encumbrance of conjugal partnership property without which, thedisposition or encumbrance shall be void.