G.R. No. 256141 , July 19, 2022
Belinda Alexander, Petitioner, vs. Spouses Jorge and Hilaria Escalona, and Reygan Escalona, Respondents.

FACTS

Spouses Jorge and Hilaria Escalona were married in 1960 and acquired unregistered conjugal properties. In 1998, Jorge executed a waiver of rights over one lot in favor of his illegitimate son, Reygan. In 2005, Reygan, through various deeds, transferred both lots to Belinda Alexander. Spouses Escalona filed a complaint for annulment of these documents in September 2005, asserting that the transactions were void for lack of Hilaria’s consent. They argued Reygan had no authority to alienate the conjugal assets. The Regional Trial Court dismissed the complaint, ruling it was barred by prescription, having been filed more than four years after the 1998 waiver. The Court of Appeals reversed, declaring the 1998 waiver and the subsequent 2005 sale void ab initio for violating the wife’s consent requirement under the Family Code, and held the action imprescriptible.

ISSUE

The core issue is whether the action to annul the alienation of conjugal property is governed by the four-year prescriptive period under Article 1391 of the Civil Code or is imprescriptible because the contract is void. A subsidiary issue is whether the applicable law on conjugal property relations is determined by the date of the marriage (1960, under the Civil Code) or the date of the disputed transaction (1998/2005, under the Family Code).

RULING

The Supreme Court affirmed the Court of Appeals, ruling the action imprescriptible. The governing law is determined by the time of the transaction, not the marriage. Since the disputed acts occurred in 1998 and 2005, the Family Code applies. Under Article 124 of the Family Code, the husband or wife cannot alienate or encumber conjugal property without the other’s consent. A contract executed in violation of this rule is void from the beginning (void ab initio). The Court reiterated the settled doctrine that an action to declare the nullity of a void contract does not prescribe. Prescription only bars voidable contracts, which are susceptible of ratification. Here, the waiver and sale, lacking Hilaria’s consent, were null and void. Consequently, the right to seek a judicial declaration of their nullity can be asserted at any time. The Court clarified that while the marriage commenced under the Civil Code, the property regime at the time of the alienation is governed by the Family Code, which was already in effect. The ruling ensures the protective intent of the Family Code’s consent requirement is not defeated by prescription. The transactions were declared void, and the properties were ordered reconveyed to the conjugal partnership.