Conjugal Property Sale Without Spousal Consent Is Void, Not Just Voidable

The Supreme Court has clarified a critical rule for anyone buying property from a married person: a sale of conjugal property made without the written consent of the other spouse is void, not merely voidable. In Spouses Aggabao v. Parulan (G.R. No. 165803, September 1, 2010), the Court also laid down a strict standard for buyers who claim to be "purchasers in good faith" — they must inquire not only into the seller's title but also into the seller's authority to sell.

The case is a practical reminder that when dealing with conjugal property, a buyer's diligence must go beyond checking the certificate of title.

The Facts of the Case

The respondents, spouses Dionisio and Ma. Elena Parulan, owned two parcels of registered land in Parañaque City. The couple was estranged. In 1991, Ma. Elena sold the property to the petitioners, Spouses Rex and Concepcion Aggabao, using a Special Power of Attorney (SPA) that purportedly authorized her to sell. The buyers paid the full purchase price and even obtained a new title over one of the lots.

It turned out, however, that Dionisio's signature on the SPA was forged. He had been out of the country when the SPA was supposedly executed, and the notary public who notarized it was not authorized to act as such in Manila for that period. Dionisio sued to nullify the sale.

The Issue

The central questions were: (1) Which law governs the sale — Article 173 of the Civil Code (which makes the sale merely voidable) or Article 124 of the Family Code (which makes it void)? (2) Were the buyers in good faith? (3) Does the ruling in Veloso v. Court of Appeals apply to protect the buyers?

The Ruling: Article 124 of the Family Code Applies

The Court ruled that Article 124 of the Family Code governed the sale. Although the spouses were married before the Family Code took effect in 1988, the sale was made on March 18, 1991 — after its effectivity. The Family Code expressly repealed the Civil Code provisions on conjugal property relations, and its retroactive application does not impair vested rights.

Article 124 provides that the administration of conjugal property belongs to both spouses jointly. If one spouse is unable to participate, the other may assume sole powers of administration — but this does not include the power to dispose or encumber the property without a court order or the written consent of the other spouse. In the absence of such consent, the disposition or encumbrance shall be void.

Since Dionisio did not consent to the sale, the deed of absolute sale was void. A void contract cannot be ratified. The Court also noted that the transaction may be treated as a "continuing offer" that the non-consenting spouse may accept or reject — but here, Dionisio rejected it by filing the nullity case.

Buyers Were Not in Good Faith

The Court rejected the buyers' claim that they were purchasers in good faith. While they had verified the authenticity of the titles, they failed to make the required inquiry into Ma. Elena's authority to sell.

The Court cited Bautista v. Silva in establishing a two-fold diligence requirement for buyers of conjugal property: (1) diligence in verifying the validity of the title, and (2) diligence in inquiring into the authority of the transacting spouse to sell on behalf of the other spouse.

The buyers knew that the law required Dionisio's written consent, yet they did not investigate the circumstances behind the SPA. They could have checked with the notary public or the court that supposedly authorized the SPA — a simple check would have revealed the forgery. They also paid the final balance without receiving the owner's duplicate copy of one of the titles, a glaring lack of precaution.

Why Veloso Did Not Apply

The buyers invoked Veloso v. Court of Appeals, where a vendee was protected despite a forged SPA. The Court distinguished the case: in Veloso, the property was exclusively owned by the husband, not conjugal, so Article 124 did not apply. Moreover, that sale occurred before the Family Code took effect, so the more lenient Article 173 of the Civil Code governed. Here, the property was conjugal, and the sale was made under the Family Code.

Practical Takeaways

• A sale of conjugal property without the other spouse's written consent or a court order is void under Article 124 of the Family Code — not merely voidable.
• Buyers must exercise two kinds of diligence: verify the title and inquire into the seller's authority to sell conjugal property.
• A forged SPA is a red flag. Buyers should verify the notary public's authority and the circumstances of the SPA's execution.
• Paying the full price without receiving the owner's duplicate certificate of title is a sign of bad faith and imprudence.
• A void contract cannot be ratified, so a non-consenting spouse may still challenge the sale after the fact.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.