Atty. Eduardo G. Makalintal

November 15, 1991 Atty. Eduardo G. Makalintal Chronicle Building, Meralco Avenue 1600 Pasig, Metro Manila S i r : This refers to your letter dated August 2, 1991 requesting opinion on the following queries: (1) Inasmuch as the property relations of husband and wife who are married after the effectivity of the Family Code may be governed by one of many kinds of regimes, e . g .absolute community, conjugal partnership of gains, complete separation of property, etc.,should the corporate secretary ask each subscriber or transferee of shares to inform him as to: (a) the subscriber's or transferee's civil status? (b) if married, when the marriage took place? (c) if the marriage took place after the effectivity of the Family Code, the kind of regime that governs the marital relations? (2) In the absence of information as to the kind of regime that governs the marital relations of a married stockholder and the other data mentioned in the preceding questions: (a) in whose name shall the shares of stock be registered? (b) in whose name shall the certificate of stock be issued? (c) whose endorsement shall be required in case of transfer? (3) If the marital relations is governed by the regime of absolute community of property: (a) should the shares of stock be registered in the name of both husband and wife? (b) should the certificate of stock be issued in the name of both husband and wife? (c) should the endorsement of both husband and wife be required before the shares can be transferred? (4) If the marital relations is governed by the regime of conjugal partnership of gains (as when the marriage took place before the Family Code or if after the effectivity thereof, there is an agreement of the parties that their marital relation shall be governed by the conjugal partnership) should the endorsement of both husband and wife be required before the shares can be transferred? By virtue of Articles 74 and 75 of the Family Code, spouses are given the freedom to choose which property regime may govern them during the marriage. The Law provides: "ARTICLE 74. The property relations between husband and wife shall be governed in the following order: 1. By marriage settlements executed before the marriage; prcd 2. By the provisions of this Code; and 3. By the local customs." "ARTICLE 75. The future spouse 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." Thus, unless a different system of property relations is agreed upon by the spouses, the property relations between the husband and the wife shall be governed by the system of absolute community of property. Assuming, therefore, that the husband and wife failed to agree on what property regime to adopt, the shares they used to own individually may be deemed as community property and shall be governed by the rules on "co-ownership" pursuant to Article 90 of the Family Code which provides: "SECTION * 90. The provisions on co-ownership shall apply to the absolute community of property between the spouses in all matters not provided for in this Chapter." (Emphasis supplied) Accordingly, the spouses, who are co-owners of shares of stock, shall be recorded as one stockholder and may, at their option, request the Corporate Secretary to issue the stock certificates in the name of both. This is true even if the stock certificates are still in their respective names. However, if the shares are among the excluded properties under Section 92 of the Family Code * or where the spouses have chosen a different marriage settlement other than the system of absolute community property, the law on co-ownership shall not apply and any transfer of shares individually owned by either of the husband or wife shall be recorded in the stock and transfer book only upon compliance with Section 63 of the Corporation Code. When doubtful, and in order to determine true ownership of shares, the corporation, thru its authorized officer, may inquire into the subscribers or transferees' property regime governing their marriage. Please be advised accordingly. cdll Very truly yours, (SGD.) ROSARIO N. LOPEZ Chairman * Copied verbatim from documents obtained directly from the Securities and Exchange Commission .