G.R. No. 188289 ; August 20, 2014
DAVID A. NOVERAS, Petitioner, vs. LETICIA T. NOVERAS, Respondent.

FACTS

David A. Noveras and Leticia T. Noveras, both American citizens, were married in Quezon City, Philippines, on December 3, 1988. They resided in California, USA, and had two children. During the marriage, they acquired properties in the Philippines and the USA. Due to business reverses, David returned to the Philippines in 2001. In December 2002, Leticia executed a Special Power of Attorney authorizing David to sell their Sampaloc, Manila property. Leticia claimed David abandoned the family and lived with another woman in September 2003. On December 3, 2003, the spouses executed a Joint Affidavit stating that: 1) the ₱1.1M proceeds from the sale of the Sampaloc property would be paid to Leticia; 2) David would return ₱750,000 to Leticia (half of the redemption price for the Sampaloc property); and 3) David renounced all his rights and interest in the conjugal properties in the Philippines. David collected ₱1,790,000 from the sale, leaving an unpaid balance of ₱410,000. Upon learning of David’s extra-marital affair, Leticia filed for divorce in California, USA. The Superior Court of California granted the divorce on June 24, 2005, awarding Leticia custody of the children and all the couple’s properties in the USA. On August 8, 2005, Leticia filed a petition for Judicial Separation of Conjugal Property before the RTC of Baler, Aurora, praying for administration of Philippine conjugal properties, forfeiture of David’s share in favor of the children, remittance of her share from the Sampaloc property sale, and payment of litigation expenses. David, in his Answer, cited the foreign divorce decree and demanded liquidation of the conjugal partnership, including USA properties.

ISSUE

The primary issues, as simplified by the RTC and addressed by the Supreme Court, included: 1) Whether David’s alleged acts of abandonment and infidelity result in forfeiture of properties; 2) Whether the Philippine court has jurisdiction over USA properties; 3) Whether the Joint Affidavit amounts to a waiver or forfeiture of David’s property rights; 4) Whether Leticia is entitled to reimbursement from the Sampaloc property sale and redemption; 5) How the absolute community properties should be distributed; 6) Whether attorney’s fees and litigation expenses are chargeable against conjugal properties; and 7) Corollary issues on support and presumptive legitimes of the children.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Decision of the Court of Appeals. The Court held:
1. The divorce decree obtained by Leticia in California, USA, is recognized in the Philippines under the principle of comity, as both parties were American citizens at the time it was obtained. The divorce validly dissolved the marriage.
2. The applicable property regime is the absolute community of property under Philippine law (Article 75, Family Code), as the parties did not execute a marriage settlement. The processual presumption applied, as the parties did not prove the relevant US law on property relations.
3. The Philippine court has jurisdiction to liquidate the conjugal properties situated in the Philippines, but not the properties in the USA, which were already adjudicated by the foreign divorce decree.
4. The Joint Affidavit, wherein David renounced his rights to Philippine properties, is void under Article 89 of the Family Code, which prohibits spouses from donating more than one-fifth of their property to each other during the marriage.
5. The Philippine properties shall be divided equally between David and Leticia. The net proceeds from the sale of the Sampaloc property, after deducting expenses, shall be shared equally.
6. The common children are entitled to presumptive legitimes equivalent to one-half of the hereditary estate of each parent. David and Leticia are each ordered to pay their children the amount of ₱520,000 as their presumptive legitimes from the Philippine properties. The legitimes shall be annotated on the property titles.
7. David is ordered to provide monthly support of US$100 to the children, in addition to their income from their legitimes, while Leticia shall provide for their other needs.
8. The unpaid balance of ₱410,000 from the sale of the Sampaloc property shall be paid, with ₱5,000 to David and ₱405,000 to be deposited in a bank account for the children.
9. Litigation expenses and attorney’s fees shall be shouldered individually by the parties.