Conjugal Property Distinguished from System of Absolute Community:

In terms of marriage settlements, the Family Code provides the following:

The future spouses may in the marriage settlements; agree upon the regime of absolute community, conjugal partnership of gains, complete separation of property, or any other regime. In the absence of marriage settlements, or when the regime agreed upon is void, the system of absolute community of property as established in this Code shall govern.[1]

In order to have a better appreciation and understanding between conjugal partnership of gains and the system of absolute community, it is best to know their difference. These two property regimes are just a part of other property regimes spouses may enter into.

Conjugal Property Distinguished from System of Absolute Community:

What is a system of absolute community?

This is one of the regimes or systems of property relations between the spouses and the default system in the absence of a prenuptial agreement or when the agreed system is null and void. This system commences at the precise moment that the marriage is celebrated, and any stipulation for the commencement of the community regime at any other time is void. In a nutshell, the husband and the wife are considered as co-owners of all properties they bring into the marriage (those that they owned before the marriage), as well as the properties acquired during the marriage, except for certain properties express excluded by law (listed below). The rules on co-ownership apply in all matters not provided under the Family Code.[2]

What is the Conjugal Property of Gains?

Oftentimes referred to as the CPG, it is one of the property relations between the spouses, under which the husband and wife place in a common fund the proceeds, products, fruits and income from their separate properties and those acquired by either or both spouses through their efforts or by chance, and, upon dissolution of the marriage or of the partnership, the net gains or benefits obtained by either or both spouses shall be divided equally between them, unless otherwise agreed in the marriage settlements. In other words, the following are placed in a common fund:

1. The proceeds, products, fruits and income from their separate properties; and
2. Those acquired by either or both spouses through their efforts or by chance.[3]

What are their differences?

A. In the system of absolute community, all the properties owned by the spouses at the time of the marriage become community property. In the conjugal partnership, each spouse retains his or her property before the marriage, and only the fruits and income of such properties become part of the conjugal properties during the marriage.

B. In the system of absolute community, what is divided equally between the spouses or their heirs upon the dissolution and liquidation of the community property is the net remainder of the properties of the absolute community, so that it may happen that a piece of land owned by either spouse before the marriage, being the only property left after the dissolution of the absolute community, would be divided between the spouses or their heirs. In the conjugal partnership of gains, however, the separate properties of the spouses are returned upon the dissolution of the partnership, and only the net profits of partnership are divided equally between the spouses or their heirs.

C. The system of absolute community is based essentially on mutual trust and confidence between the spouses and fosters oneness and unity between them. This is in fact the tradition and custom among the great majority of Filipinos and this is the reason why the Family Code adopts this system instead of the conjugal partnership of gains, which is taken from Spanish law. In conjugal partnership of gains, the capital or properties of the spouses are kept separate and distinct from the benefits acquired by them during the marriage. This constitutes an insurmountable obstacle to the presumption of solidarity between the spouses.[4]

D. It is easier to liquidate the absolute community property because the net remainder of the community properties are just divided between the spouses or their heirs. In the conjugal partnership, the exclusive properties of the parties will have to be identified and returned, and sometimes, this identification is very difficult. [5]

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[1] Article 75, Family Code of the Philippines

[2] http://jlp-law.com/blog/system-of-absolute-community-property-relations-in-marriage/

[3] http://jlp-law.com/blog/conjugal-partnership-gains-property-relations-marriage/

[4] National Bank v. Quintos, 46 Phil. 370

[5] Justice Alicia Sempio-Diy, Handbook on the Family Code of the Philippines, p62, 1995 Edition