Quiao v. Quiao, G.R. No. 183622, July 4, 2012

FACTS: Brigido Quiao (petitioner) and Rita Quiao (respondent) contracted marriage in 1977. They had no separate properties prior to their marriage. During the course of said marriage, they produced four children. In 2000, Rita filed a complaint against Brigido for legal separation for cohabiting with another woman. Subsequently, the RTC rendered a decision in 2005 declaring the legal separation of the parties pursuant to Article 55. Save for one child (already of legal age), the three minor children remains in the custody of Rita, who is the innocent spouse.

The properties accrued by the spouses shall be divided equally between them subject to the respective legitimes of their children; however, Brigido’s share of the net profits earned by the conjugal partnership shall be forfeited in favor of their children in accordance to par. 9 of Article 129 of the FC.

A few months thereafter, Rita filed a motion for execution, which was granted by the trial court. By 2006, Brigido paid Rita with regards to the earlier decision; the writ was partially executed.

After more than 9 months later, Brigido filed a motion for clarification asking the RTC to define “Nets Profits Earned.” In answer, the court held that the phrase denotes “the remainder of the properties of the parties after deducting the separate properties of each of the spouses and debts.”

Upon a motion for reconsideration, it initially set aside its previous decision stating that NET PROFIT EARNED shall be computed in accordance with par. 4 of Article 102 of the FC. However, it later reverted to its original Order, setting aside the last ruling.

ISSUE: Whether or not the regime of conjugal partnership of gains governs the couple’s property relations.

HELD: Yes. Brigido and Rita tied the knot on January 6, 1977. Since at the time of exchange of martial vows, the operative law was the NCC and since they did not agree on a marriage settlement, the property relations between them is the system of relative community or the conjugal partnership of gains. Under this property relation, “the husband and wife place in a common fund the fruits of their separate property and the income from their work and industry. The husband and wife also own in common all the property of the conjugal partnership of gains.