Marriage: Who owns what?

Question: I am about to get married. My future wife and I are not really fans of prenuptial agreements. Also, there really is not that much to include in the prenuptial agreement.

How will our properties be shared between us?—asked at EnRich™ Estate Planning training program

Answer: Since you will be married after Aug. 3, 1988 when the Family Code of the Philippines was promulgated and since you do not want to enter into any marriage settlements, you and your future spouse will fall under the system of absolute community.

There are other systems to consider, such as the conjugal partnership of gains, regime of separation of property and regime of unions without marriage. But let us focus on your case.

The law provides that property relations between spouses shall be governed in the following order: 1) by marriage settlements executed before the marriage; 2) by provisions of the Family Code, and 3) by local customs.

In your case, you will fall under the provisions of the Family Code. In the absence of any marriage settlements, property relations between husband and wife fall under the system of absolute community of property.

The system of absolute community of property begins at the precise moment of the celebration of your marriage.

If you are getting married in the afternoon of your wedding day, you and your future spouse will fall under the system of absolute community of property on that same afternoon.

Absolute community of property means that you and your future spouse will be co-owners of all the properties that each of you will bring into your marriage as well as of all those that you will acquire during your marriage.

So, even if you owned a sports car that you bought for the purpose of impressing the ladies during your debonair days, your future spouse will be a co-owner of that sports car as soon as you get married.
But there are exclusions.

Excluded from the system of absolute community of property are: 1) properties acquired by you or your future spouse during your marriage through gratuitous title including the fruits from and income thereof; 2) properties for each of your personal and exclusive use, and 3) properties acquired by either of you before your marriage where either of you have legitimate descendants under a former marriage, including the fruits from and income thereof.

Gratuitous comes from the Latin word gratuitus, which means done without pay, spontaneous and voluntary.

Under the Family Code, gratuitous title means donation or testate/intestate succession. Testate succession is the transfer of property through a will. Intestate succession is the transfer of property without a will.

So, if your parents donate property to you and you alone during your marriage, your future spouse will not co-own that property as well as the fruits and income therefrom. Please note, however, that with donation come donor’s taxes.

As to properties for each of your personal and exclusive use, your future spouse will not own your toothbrush; so go ahead and buy the most expensive one. However, jewelry will still be co-owned by you and your future spouse. You need not get used to wearing jewelry yourself.

Just know that you will co-own those with your future spouse.

The third exclusion is intended to protect the rights of legitimate children and descendants of your former marriage, if you have any. If we were to simply apply the system of absolute community of property, the rights of the children and descendants of your previous marriage, again if you have any, may be prejudiced.

As a final note, know that, unless either of you can prove that they are excluded, any and all properties you and your future spouse will acquire during your marriage will form part of your absolute community property. Your house, car, furniture, home appliances, paintings and others will be co-owned by you and your future spouse under the system of absolute community of property.

The concept of property relations between husband and wife is really part of what is called estate planning. If you want to learn more and directly from an estate planning lawyer, attend one of the remaining 2014 EnRich™ Estate Planning training runs happening in Davao (Oct. 3) and Manila (Oct. 10). E-mail info@personalfinance.ph or SMS 0917-5050709 for details. Details for the training may also be found in www.personalfinance.ph. –Efren Ll. Cruz |Philippine Daily Inquirer

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