Philippines: Property Regimes (Meaning and Concepts)
Philippine Property Regimes
(Meanings and Concepts)
Marriage is a symbolic union of man and woman where both of them will become one in the eyes of the Lord. But in the eyes of the state marriage is a contract, a civil right, wherein the state will recognize them as husband and wife entitled to all the rights and privileges stated in the laws. One cannot deny that marriage is not only a union of two persons but also the union of properties. A very common question to those who would marry is on how to manage their properties once they are united before God and the Law. If you are the one to be married, how will the both of you manage your properties during the course of a married life?
What does the Law says?
(Article 75 of the Family Code of the Philippines)
“The future spouses may, in the marriage settlements, agree upon the regime of absolute community, conjugal partnership of gain, complete separation of property, or any other regime. In the absence of a marriage settlement, or when the regime agreed upon is void, the system of absolute community of property as established in this Code shall govern.”
A property regime is the set of rules agreed upon by the parties, before getting married, which would govern their property relations during the course of their married life. The laws of the Republic of the Philippines recognizes three kinds of property regimes namely:
Sources:
1http://www.mylawyer.asia/node/32
In the absence of a marriage settlement (pre-nuptial agreement) or when there is such but is void. One of the three property regimes will apply depending on when the person is married.
Regime of Conjugal Partnership of Gains
If there is no pre-nuptial agreement during the celebration of marriage and such marriage took place on or before August 3, 1988 the regime of conjugal partnership of gains applies.
This is the most common property regime in the Philippines. Majority of the middle class married Filipinos don't have a pre-nuptial agreement and most of them are married before August 3, 1988 especially our parents. Moreover, they don't agree to pre-nuptial agreement because they believe that love is not about properties, money and etc. They love each other that is why they get married.
Under the regime of conjugal partnership of gains, 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. (Family Code of the Philippines, Article 106)
For basic understanding, conjugal partnership of gains primarily focuses on the gains of the husband and wife during the time of their partnership (marriage). All their income, gains, fruits will be the common properties of the spouses.
All the properties they acquire before getting married will be their own exclusive properties. What the man owns is his own, what the woman owns is her own. Those properties acquired before marriage will not form part of their common properties during marriage but the fruits and income of such exclusive properties will form part of the common properties.
Regime of Absolute Community of Property
If there is no pre-nuptial agreement during the celebration of marriage and such marriage took place after August 3, 1988 the regime of absolute community of property regime applies.
...the community property shall consist of all the property owned by the spouses at the time of the celebration of the marriage or acquired thereafter. (Family Code of the Philippines, Article 91)
This is the current governing property regime in the absence of a pre-nuptial agreement since 1988 is already past due. This is the property regime wherein the properties of both spouses will be combined. Both of them will become owners of the properties that each of them had brought into marriage.
Regime of Complete Separation of Properties
Separation of property may refer to present or future property or both. It may be total or partial. In the latter case, the property not agreed upon as separate shall pertain to the absolute community. (Family Code of the Philippines, Article 144)
Each spouse shall own, dispose of, possess, administer and enjoy his or her own separate estate, without need of the consent of the other. To each spouse shall belong all earnings from his or her profession, business or industry and all fruits, natural, industrial or civil, due or received during the marriage from his or her separate property. (Family Code of the Philippines, Article 144)
This is a property regime wherein both spouses needs to have an agreement in order to put on effect or else absolute community of property regime will apply. Separation of properties may be total or partial.
What do you think on how you will govern your property during marriage? Still not satisfied? Then stay tuned for the next post. There things will be more elaborately explained.
This is somewhat not detailed. For the detailed explanation, I reserve it for the next post which will discuss property regimes for estate tax purposes. There, the property regimes will be elaborated on what is exclusive and common and why it is important. Moreover, I will give tips and examples on the next post. So stay tuned!
You may comment down any question. Feel free cause it is free.
Your Lovely Accountant Steemian
Awesome explanation..keep it up @paulthebeloved. Good luck to ur next post!
Thank you! Keep in touch :)