PEOPLE BANK AND TRUST CO., PETITIONER AND APPELLANT, VS. THE REGISTER OF DEEDS FOR THE CITY OF MANILA, RESPONDENT AND APPELLEE.

IMPERIAL, J.:

This is an appeal taken by the Peoples Bank and
Trust Co. from the judgment rendered by the Court of First Instance of
Manila, denying the registration of a certain instrument entitled
“Agreement and Declaration of Trust”.

The undisputed facts of the case may be summarized as follows:

On October 26, 1933, Dominga Angeles, married to
Manuel Sandoval who resides in Palawan and from who she lives separate
and apart, executed an instrument entitlted “Agreement and Declaration
of Trust” in favor of the Preople Bank and Trust Co. whereby she
conveyed in trust her paraphernal property consisting of three (3)
parcels of land together with two (2) buildings thereon, situated at
Nos. 1989 and 1933 Juan Luna, Manila, particularly described in
transfer certificate of titlte No. 21661 issued in her name. The said
trust was constituted in order that the lands would be subdivided into
small lots; that said lots would be sold either for cash or by
installments; that the trustee would redeem the mortgage constituted on
said that the trustee would grant a loan of P10,000 with which to
redeem the mortgage in question; and that the said trustee would
collect the rents to be derivbed from said property while the lots
remained unsold.

The instrument was presented to the registerr of
deeds for the City of Manila for registration, which was denied by the
said official. Whereupon the Peoples Bank and Trust Co, brought the
matter in consulta before the Court of First Instance of
Manila, which on January 5, 1934, sustained the action of the register
of deeds and denied the registration applied for.

The trial court based its decision on the alleged
ground that according to the terms of the contract the trustee was
authorized to collect the fruits of the paraphernal property while the
lots remained unsold or unalienated to other persons in the manner
above stated, and, inasmuch as under the provisions of articles 1385
and 1401 (3) of the Civil Code such fuits are considered conjugal
partnership property, the management of which corresponds to the
husband, in accordance with article 1412 of the said Code, and said
husband did not intervene in nor give his consent to the instrument in
question, the same is null and void and, therefore, not susceptible of
registration.

The appellant contends that pusuant to the
provisions of article 1387 of the Civil Code, as amended by section 1
of Act No. 3922 of the Philippine Legislature, the grantor Dominga
Angeles did not need marital consent thereto and, therefore, the
instrument is valid and susceptible of registration.

The question raised in this appeal does not require
interpretation nor application of the provisions of Act No. 3922,
amending article 1387 of the Civil Code. For the purposes of this
decision it is taken for granted that, in accordance with the
provisions of articles 1385 and 1401 (3) of the Civil Code, the fruits
of the paraphernal property which had beenc conveyed lin trust, belong
to the conjugal partnership, the management of which corresponds
exclusivel to the husband of the grantor (article 1412).

It should be borne in mind that according to the
deed of trust the grantor neither parts with nor conveys the rents of
her paraphernal property in favor of the trustee but merely aumthorizes
it to collect them during the time the lots remain unsold. The
authority thus conferred only constitutes a mere act of administration
which article 1384 expressly vests upon the grantor, in this instant
case involving paraphernal property which she has not delivered to he r
husband before a notary, for the purpose of conferring its management
upon him. The article in question reads as follows:

“ART. 1384. The wife shall have the
management of the paraphernal property unless she has deliverd the same
to her husband before a notary, for the purpose of conferring its
management upon him.

“In such cases it
shall be the duty of the husband to execute a mortagage for the value
of any personality which may be so delivered to him or otherwise secure
it in the manner prescribed with respect to dowry property.”

If the grantor is the legal adminatrix of the
property in question, there can be no qustion that she has the right to
collect the fruits thereof and that she may, as she has done in this
case, delegate such power to other persons. To deny her such right
would be tantamount to coverting her from adminatrix therof into a mere
collector of rents.

To the wife belongs the management of the fuits of
her paraphernal property, which has not been delivered to husband under
the formalitites prescribed by the law, while such fruits rremain
unliquidated, on the ground that they answer for the necessary and
indispensable expenses incurred in the administration and preservation
of the property. Not till then does the husnband acquire the right to
claim them for the conjugal partnerhship of which he is the sole
administrator. Applying the principle to the case under consideration,
it becomes evident that the grantor’s husband cannot claim the fruits
in question for their conjugal partnership until a liquidiation thereof
has been made by her.

On the other hand, failure to comply with the requisite prescribed in article 1387 does not render the contract null and void ab initio
but merely voidable, and the right of action which may arise under such
circumstances exclusively belongs to the husband or his heirs.
Wherefore, even granting that such public instrument is defective, it
is, nevertheless, susceptible of registration.

What we have heretofore stated finds support in the following commentaries of Manresa:

“Fortunately there is already a
decision of the Supreme Court to that effect The doctrine is
sufficiently explicit. A married woman, actually living separate from
her husband, leases her paraphernal property, collects rents and
appoints administrators thereof, without marital consent

The husband claims that such acts demand his
permission as an indispensable requisite. The trial court absolves the
wife and, upon appeal, it is held, on November 8, 1898, that the
management of paraphernal property conferred upon the wife by article
1384 of the Civil Code carries with it the power to enter into
contracts regarding the same, subject only to the limitation contained
in article 1387, the wife personally defraying the expenses incurred
therein as a consequence, without prejudice to the liabilities to which
such property is subject, in accordance with the provisions of article
1385.

“Later, the decision of October 16,
1918, held that the management of the paraphernal property by the wife
should be conducted in accordance with the provisions of article 1384
of the Civil Code, which only differs from the former law in that for
such acts and contracts executed in connection with said management the
wife does not need marital consent. This management should not be
understood as limited by the law merely to gathering fruits and
collecting rents and interest thereon and delivering them to the
husband, for that would be tantamount to concerting the wife from an
administratrix into a mere collectors of rents of the paraphernal
property, which is one of the manifold acts embraced by the
administration, and which, on the other hand, is compatible with the
provisions of article 1385.

“Finally, the
decision of January 14, 1928, ratifies this same doctrine and holds
that the prohibition contained in article 1387 cannot, from its very
nature, be interpreted except in a restrictive manner, by reason of
which the wife may legally perform every act not intended to alienate,
mortgage or otherwise encumber her paraphernal property, she being
authorized to execute contracts arising from the administration of an
estate, and consequently to obtain loans, without marital consent, for
the benefit of said property.

“From the
foregoing, we may conclude that, although the Civil Code has not solved
this question at issue explicitly and definitely, the most logical
interpretation that can be given to article 1384, in connection with
article 1387, is that which grants the wife complete freedom in the
management of her paraphernal property and renders marital consent as
unnecessary, except for acts expressly stated in articles 1387, 995 and
1053. The exceptions contained in articles 61 and 1263, although vague
and broad in scope, agree with this solution inasmuch as in the last
analysis they admit of cases in which a married woman does not need
marital consent. Such broadness leaves enough ground to suppose that
the aforesaid cases include the management granted the wife by article
1384.

* * * * * * *

“The consent of the husband has the
same meaning in article 1387 as in all the other articles of the Code
which demand this requisite. It does not merely fill up any defect in
the capacity of a woman to contract and bind herself. It is a very
personal power granted the head of the family to maintain good order
therein, as affirmed by the Registry Office, or to avoid loss or
damages that the conjugal partnership might suffer without such
intervention, as affirmed by the Supreme Court. (Resolution of January
24, 1898, and decisions of June 27, 1866, and January 30, 1872.)

“Lack of marital consent does not render the act null and void but
merely voidable at the instance of the husband or of his heirs. Hence
the admission for registration nowadays of contracts executed by the
wife without such requisite, stating such circumstance therein, as we
have declared at the end of the commentary on article 65, second
edition of this work. (Resolutions of November 23, 1892, August 22,
1894, and March 31, 1898.)” (Manresa, vol. IX, pp. 433, 434, 448,
Fourth Edition.)

* * * * * * *

“Article 62 declares null and void
the acts executed by the wife without the consent of her husband in
cases where such consent is a necessary requisite. However, according
to the legal provision just considered, only the husband and his heirs
may avoid such acts, which is but logical and natural, considering the
spirit of the legal provision in question. From the foregoing and
applying the Civil Marriage Law and the former laws which accej/ted the
same doctrine, the Supreme Court, in its decisions of June 27, 1866,
January 30, 1872, and November 14, 1862, held that acts performed by a
married woman without permission of her husband are not null and void
but merely voidable, at the instance of the husband or his heirs, on
the ground that the legal prohibition in question was not established
in favor of third persons but with a different end or purpose, that is,
in favor of the husband whom the law wants to protect from possible
damages to the conjugal partnership of which he is the head.

“After the Civil Code went into effect, the General Registry Office
accepted the same doctrine and even considered acts and contracts,
executed by a married woman without permission of her husband,
susceptible of registration as long as such circumstance was stated in
the record, to serve as notice to third persons who might later
contract with regard to the same property. (Resolutions of November 23,
1892 and August 22, 1894.) It would seem that this doctrine is
contradicted by those established on January 24, 1898, March 29, 1901,
and April 21, 1908, but the principal question raised in the first case
was whether or not the husband could authorize a third person to give
such consent, while in the second and third cases no statement was made
to the effect that the contracts was not registerable, nor much less
null and void, but that the deed was not extended by the notary, who
instituted the appeal, in accordance with the provisions of the law. On
March 31, 1898, the General Registry Office reiterated its views in
favor of registration notwithstanding the lack of the requisite of
marital consent.”

Wherefore, the decision appealed from is hereby
reversed, and the register of deeds for the City of Manila is hereby
ordered to register the instrument in question, upon payment of the
corresponding legal fees, without special pronouncement as to the
costs. So ordered.

Malcolm, Villa-Real, Hull, and Goddard, JJ., concur.