AGUEDA BENEDICTO DE LA RAMA vs. ESTEBAN DE LA RAMA,7 PHIL 745 (1907)

FACTS:Esteban dela Rama claims that upon the dissolution of the conjugal property, he is entitled to 81,387.76 based on the income of profits earned by the partnership prior to the dissolution.

ISSUE/S:Whether income or profits earned by the partnership is used in determining the total conjugal assets for purposes of dissolution of the conjugal partnership.

HELD:NO. The civil code provides that upon dissolution of the conjugal partnership an inventory on all conjugal properties shall at once be made. After deductions (dowries, debts, etc.) then the remainder is to be divided equally between the spouses.The conjugal property which is to be eventually divided is determined not with reference to the income or profits which may have been received during the partnership but rather by the amount of the actual property possessed by them at such dissolution after making the deduction and payments aforesaid.In liquidating a conjugal partnership, an inventory of the actual property possessed by the spouses at the time of the dissolution must be made. It is error to determine the amount to be divided by adding up the profits which had been made in each year of its continuance and saying that the result is that amount.

QIs inventory and liquidation always necessary?ANO. When the interested parties have already reached a compromise, whereby for valuable consideration, the widow renounced in favor of the children all her interest and rights in the estate of the deceased as well as her participation in the conjugal partnership, it is no longer necessary to prepare an inventory of the conjugal properties and make a liquidation. (VDA. DE VILLACORTE vs. MARIANO)