Financial Obligations Between Common-Law Partners in the Philippines
(A doctrinal and practical overview as of 24 April 2025)
1. Introduction
In Philippine law, “common-law partners” (or live-in partners/cohabitants) are two people who live together as husband and wife without a valid marriage license. Because the 1987 Constitution and the Family Code heavily protect marriage, cohabitation does not create the legal status of “spouses.” Nevertheless, the legislature and the Supreme Court have crafted specific rules to regulate the economic consequences of these unions—chiefly through Articles 147 and 148 of the Family Code, select provisions of the Civil Code, social-benefit statutes, and jurisprudence.
2. Statutory Framework
| Provision | Situation Covered | Core Rule |
|---|---|---|
| Art. 147, Family Code | Both partners are capacitated to marry each other but, for any reason, their marriage is void (e.g., missing license, psychological incapacity) | A co-ownership arises over property acquired during the union through their joint efforts or work; shares are in proportion to contribution, presumed equal in the absence of proof. |
| Art. 148, Family Code | At least one partner is incapacitated to marry the other (e.g., bigamy, existing subsisting marriage, incest) | Only properties actually acquired by their joint contributions are co-owned, always in proportion to proven contribution; wages and salaries remain exclusively with the earner; bad-faith partner forfeits share in favor of common children, or the innocent partner’s legitimate children, under certain conditions. |
| Art. 102 & 129, Family Code | Liquidation of community or conjugal partnership by analogy | Courts apply these when dissolving Art. 147/148 co-ownerships if helpful. |
| Art. 195, Civil Code (Support) | Enumerates who are obliged to support each other | No express mention of common-law partners, but jurisprudence extends the duty if the relationship falls under Art. 147 (capacity in good faith). |
| Republic Act No. 9262 (VAWC) | Defines economic abuse | A live-in partner may be prosecuted for economic violence, creating implied duties to provide support. |
3. Property Relations During the Union
Formation of a statutory co-ownership
- In good-faith unions (Art. 147) every property acquired while cohabiting through industry, work, or salary becomes presumptively owned 50-50, unless a different proportion is shown.
- In bad-faith or bigamous unions (Art. 148) only property jointly purchased or built is co-owned, each owning strictly pro-rata to proof of actual contribution—sweat equity counts.
Exclusions
- Exclusive property before the union, and property acquired by gratuitous title (inheritance, donation) remain exclusive, unless the donor expressly provides otherwise.
- Wages and salaries earned by the innocent partner in an Art. 148 relationship are solely his or hers.
Management
- Either partner may manage the co-owned property unless the other objects. Acts of administration need only simple majority; acts of ownership (sale, mortgage) require the written conformity of both partners or, if one refuses, judicial authorization for a valid disposition.
4. Support Obligations
- Moral and statutory basis. Although Art. 195 names only legitimate spouses, Supreme Court rulings (e.g., People v. Domingo, G.R. 187655, 2021) have cited the bona fide union principle in Art. 147 to impose a duty of mutual support during cohabitation and after separation until partition.
- Amounts. Following Art. 201, support consists of everything indispensable for sustenance, dwelling, clothing, medical, education and transportation, measured by the means of the giver and needs of the receiver.
- Enforcement. An action for support may be filed in the appropriate family court; provisional support may be ordered under Rule 61 of the Rules of Court. Failure to comply may result in contempt or prosecution under the VAWC Act.
5. Debts and Liabilities
| Type of Obligation | Responsibility | Notes |
|---|---|---|
| Personal debts of a partner | Remain personal; creditors can reach only that partner’s exclusive property and his or her undivided share in the co-ownership. | |
| Household or family expenses | Considered solidary liabilities if contracted for the family; creditors may proceed against co-owned property up to the debtor-partner’s share. | |
| Civil liability for torts | Same rule as above; no automatic extension to the innocent partner unless conspiracy or negligence is proven. |
6. Dissolution and Partition
- Causes: Voluntary separation, death of a partner, supervening valid marriage, or judicial declaration (e.g., petition under A.M. 02-11-11-SC).
- Procedure:
- Inventory of co-owned assets and debts.
- Reimbursement of exclusive funds used for common property.
- Deduction of outstanding common liabilities.
- Distribution in proportion to contribution (or 50-50 under Art. 147 presumption).
- Prescription: An action for partition under Art. 147 does not prescribe so long as the co-ownership subsists; under Art. 148, ordinary prescriptive periods apply once the union ends (Heirs of Malate v. Gamboa, G.R. 181913, 2012).
7. Succession
- No successional rights exist between common-law partners.
- However, each partner may inherit from the other by will up to the free portion (Art. 886, Civil Code).
- The surviving partner may invoke “actual beneficiary” status for SSS, GSIS or Pag-IBIG death benefits if duly designated or if there are no competing primary beneficiaries.
8. Public and Employment Benefits
| Benefit System | Rules for Live-In Partners |
|---|---|
| Social Security System (SSS) | Partner can receive benefits only if explicitly named as secondary beneficiary; otherwise proceeds go to legitimate heirs. |
| Government Service Insurance System (GSIS) | Similar rule; live-in partner may qualify as “designated beneficiary.” |
| PhilHealth | A partner may be declared as a dependent under the “common-law spouse” category upon proof of cohabitation. |
| Private Employee Benefits | Governed by company policy and CBA; most major employers recognize “domestic partners” for HMO cover and death benefits upon notarized affidavit. |
9. Tax, Property Registration & Housing
- Taxation: The partners file separate income tax returns; there is no merged tax status akin to married couples.
- Capital gains & donor’s taxes follow ordinary rules; partitions incident to Article 147/148 settlement are exempt from tax (BIR Ruling DA-174-09).
- Real Property Titles: Register co-owned land as “Juan dela Cruz, married to/and Maria Reyes (co-owners under Art. 147 FC)” to avoid confusion.
- Pag-IBIG Housing Loans: May be taken jointly by common-law partners if both are members and the relationship is disclosed.
10. Criminal Law Interface
- Bigamy (Art. 349 RPC): A partner who marries a third party while the first spouse is alive incurs criminal liability; the innocent live-in partner’s property share is protected but there is no automatic civil liability on her part.
- Concubinage/Adultery: Do not apply to common-law unions; instead, the aggrieved partner’s remedy is economic (partition, damages).
- Anti-VAWC Act (RA 9262): Applies to “a woman with whom the offender has or had a sexual or dating relationship”—therefore extends to common-law unions, penalizing economic abuse and abandonment.
11. Recent Jurisprudence Snapshot (2018-2024)
| Case | G.R. No. | Doctrine |
|---|---|---|
| Granada v. Lim | 230508 (2024) | Where both partners acted in bad faith, the court ordered forfeiture of each share in favor of their minor common child. |
| People v. Domingo | 187655 (2021) | Affirmed that failure of a live-in partner to support the woman and their children constitutes economic abuse under RA 9262. |
| Sps. Alcantara v. Heirs of Castillo | 242017 (2019) | Clarified that occupancy of the family home remains with the custodial parent after separation of cohabitants. |
12. Practical Compliance Checklist
- Document Contributions: Keep receipts and bank records for all major purchases.
- Execute a “Contract of Cohabitation”: In writing, stipulate property shares, support, dispute-resolution; while not expressly provided by law, it is valid under the freedom to contract (Art. 1306).
- Designate Beneficiaries: Update SSS, GSIS, PhilHealth, insurance, and bank TOD accounts.
- Maintain Individual Credit: Avoid joint debts unless both intend to be bound.
- Prepare Wills: Secure the partner’s financial security within the free portion to pre-empt disputes with compulsory heirs.
13. Policy Gaps and Prospects
Scholars urge Congress to enact a “Civil Unions Act” to:
- Grant successional rights akin to legitimate spouses;
- Simplify tax filing by allowing optional joint returns;
- Provide a statutory maintenance scheme after dissolution, calibrated by years of cohabitation; and
- Harmonize public-benefit designations.
As of April 2025, several bills (e.g., House Bill J25-“Civil Partnerships Act”) are pending in committee.
14. Conclusion
While Philippine law still prizes formal marriage, it recognizes and regulates the financial obligations of common-law partners to protect economic justice and family stability. The key takeaways are:
- Art. 147 (good-faith) and Art. 148 (bad-faith) create distinct co-ownership regimes.
- Partners may owe each other support; they share in jointly acquired property and face solidary liability for family necessities.
- They enjoy limited wage protection, beneficiary status, and tax neutrality, but no automatic inheritance.
- Proper documentation and contractual planning are indispensable to safeguard rights.
As jurisprudence evolves and legislative reform looms, cohabitants—and their counsel—must stay vigilant to ensure that love without a license does not become life without protection.