G.R. No. 97898 August 11, 1997
Florante F. Manacop, petitioner, vs. Court of Appeals and E & L Mercantile, Inc., respondents.

FACTS

Petitioner Florante F. Manacop and his wife purchased a residential lot with a bungalow in Quezon City on March 10, 1972. On March 17, 1986, private respondent E & L Mercantile, Inc. filed a complaint to collect an indebtedness. The parties entered into a compromise agreement, which was approved by the trial court in a judgment dated April 20, 1986. Private respondent later filed a motion for execution, which was granted on September 23, 1986. Execution was delayed, but eventually, the sheriff levied on petitioner’s personal properties. On August 1, 1989, petitioner filed a motion to quash the alias writs of execution, arguing the judgment was not yet executory. Private respondent opposed, alleging the property covered by TCT No. 174180 could not be considered a family home as petitioner was living abroad and the property, acquired in 1972, was not judicially constituted as a family home under the Civil Code. The trial court denied the motion to quash, ruling the property was not exempt from execution as it was not duly constituted as a family home. The Court of Appeals affirmed, noting no evidence showed the residence was duly constituted as a family home and that petitioner and his family were living abroad. Petitioner filed a motion for reconsideration, arguing the property was exempt as a family home. The Court of Appeals denied the motion, applying Modequillo v. Breva, which held that existing family residences are considered family homes prospectively from the effectivity of the Family Code. It found that both the debt (incurred in 1982) and the judgment (1986) preceded the effectivity of the Family Code on August 3, 1988, thus the exemption did not apply.

ISSUE

May a writ of execution of a final and executory judgment issued before the effectivity of the Family Code be executed on a house and lot constituted as a family home under the provision of said Code?

RULING

Yes. The Court of Appeals committed no reversible error. The Court ruled that the family home exemption under the Family Code does not apply retroactively to debts incurred prior to its effectivity. Citing Modequillo v. Breva, the Court held that existing family residences are considered family homes only prospectively from the effectivity of the Family Code (August 3, 1988) and are not exempt from execution for debts incurred before that date. In this case, the debt was incurred in 1982 and the judgment was rendered in 1986, both preceding the Family Code’s effectivity. Therefore, the property is not exempt from execution. The Court also addressed petitioner’s claim of actual occupancy, stating that actual occupancy must be by the owner or beneficiaries enumerated in Article 154 of the Family Code, which excludes maids or overseers. Since petitioner and his family were living abroad, and only an overseer occupied the property, there was no actual occupancy by a beneficiary as required by law. The petition was denied for lack of merit.