G.R. No. 153447 ; February 23, 2004
VICENTE G. VILLARANDA, petitioner, vs. Spouses HONORIO G. VILLARANDA and ANA MARIA Y. VILLARANDA; and COLORHOUSE LABORATORIES, INC., respondents.

FACTS

Petitioner Vicente Villaranda and respondent Honorio Villaranda, brothers, executed a Deed of Exchange on July 6, 1976. Vicente agreed to convey his 64.22-square-meter share of a family property in Divisoria, Cagayan de Oro City, to Honorio. In exchange, Honorio would give Vicente a 500-square-meter portion of his property in Macasandig, Cagayan de Oro City. Honorio took possession of the Divisoria lot and built on it. Years later, a subdivision plan was completed, and a title for the Divisoria lot was issued in Vicente’s name.
Honorio and his wife, Ana Maria, filed an action for specific performance to compel Vicente to comply with the Deed by formally conveying the titled Divisoria lot and identifying his 500-square-meter portion of the Macasandig property. Vicente resisted, arguing the contract was revoked due to iniquitous consideration and non-delivery. He also contended the Deed was void because Ana Maria did not sign it, making the alienation of a conjugal asset (the Macasandig property) invalid.

ISSUE

The core issue is whether the Deed of Exchange is valid and enforceable despite the absence of the wife’s consent to the alienation of conjugal property.

RULING

The Supreme Court affirmed the lower courts’ decisions, ruling the Deed of Exchange is valid and binding. The legal logic hinges on the applicable law at the time of the contract’s execution. The Deed was executed in 1976, prior to the effectivity of the Family Code. Under the governing Civil Code, the husband was the administrator of the conjugal partnership. His alienation or encumbrance of conjugal property without the wife’s consent was not void but merely voidable. The wife could annul the transaction within ten years from its execution.
Here, Ana Maria did not file an action for annulment. Her awareness of the Deed and her subsequent act of joining her husband in filing the suit for specific performance constituted clear ratification and assent. The cause of action for specific performance accrued only when Vicente refused to transfer title decades later, not from the 1976 execution, so the action was not time-barred. The Court also found no basis for Vicente’s claim of revocation or iniquitous consideration, noting the parties’ capacities at execution and the contract’s binding nature. Therefore, Vicente was ordered to comply with his obligations under the Deed.