Litonjus vs litonjua Aurelio and Eduardo are brothers.

In 1973, Aurelio alleged that Eduardo entered into a contract of partnership with him. Aurelio showed as evidence a letter sent to him by Eduardo that the latter is allowing Aurelio to manage their family business (if Eduardos away) and in exchange thereof he will be giving Aurelio P1 million or 10% equity, whichever is higher. A memorandum was subsequently made for the said partnership agreement. The memorandum this time stated that in exchange of Aurelio, who just got married, retaining his share in the family business (movie theatres, shipping and land development) and some other immovable properties, he will be given P1 Million or 10% equity in all these businesses and those to be subsequently acquired by them whichever is greater. In 1992 however, the relationship between the brothers went sour. And so Aurelio demanded an accounting and theliquidation of his share in the partnership. Eduardo did not heed and so Aurelio sued Eduardo. ISSUE: Whether or not there exists a partnership. HELD: No. The partnership is void and legally nonexistent. The documentary evidence presented by Aurelio, i.e. the letter from Eduardo and the Memorandum, did not prove partnership. The 1973 letter from Eduardo on its face, contains typewritten entries, personal in tone, but is unsigned and undated. As an unsigned document, there can be no quibbling that said letter does not meet the public instrumentation requirements exacted under Article 1771 (how partnership is constituted) of the Civil Code. Moreover, being unsigned and doubtless referring to a partnership involving more than P3,000.00 in money or property, said letter cannot be presented for notarization, let alone registered with the Securities and Exchange Commission (SEC), as called for under the Article 1772 (capitalization of a partnership) of the Code. And inasmuch as the inventory requirement under the succeeding Article 1773 goes into the matter of validity when immovable property is contributed to the partnership, the next logical point ofinquiry turns on the nature of Aurelios contribution, if any, to the supposed partnership. The Memorandum is also not a proof of the partnership for the same is not a public instrument and again, no inventory was made of the immovable property and no inventory was attached to the Memorandum. Article 1773 of the Civil Coderequires that if immovable property is contributed to the partnership an inventory shall be had and attached to the contract.

AURELIO K. LITONJUA, JR., vs. EDUARDO K. LITONJUA, SR, et al. (G.R. Nos. 166299-300. December 13, 2005) FACTS: Petitioner and herein respondent are brothers. The legal dispute between them started when, Aurelio filed a suit against his brother Eduardo alleging that, since June 1973, he and Eduardo are into a joint venture/partnership arrangement in the Odeon Theater business which had accumulated various assets including but not limited to the corporate defendants and their respective assets. Also, the substantial assets of most of the corporate defendants consist of real properties. However, sometime in 1992, the relations between Aurelio and Eduardo became sour so that Aurelio requested for an accounting and liquidation of his share in the joint venture/partnership but to no avail. Petitioner has reasonable cause to believe that respondents are transferring various real properties of the corporations belonging to the joint venture/partnership to other parties in fraud of petitioner. ISSUE: WON petitioner and respondent are considered partners in the theatre, shipping and realty business. HELD: The instant petition is DENIED. A further examination of the allegations in the complaint would show that petitioners contribution to the so-called "partnership/joint venture" was his supposed share in their family business. In other words, his contribution as a partner in the alleged partnership/joint venture consisted of immovable properties and real rights. Lest it be overlooked, the contract-validating inventory requirement under Article 1773 of the Civil Code applies as long as real property or real rights are initially brought into the partnership. In context, the more important consideration is that real property was contributed, in which case an inventory of the contributed property duly signed by the parties should be attached to the public instrument, else there is legally no partnership to speak of. Considering that the allegations in the complaint showed that petitioner contributed immovable properties to the alleged partnership, the "Memorandum" which purports to establish the said "partnership/joint venture" is NOT a public instrument and there was NO inventory of the immovable property duly signed by the parties. As such, the said "Memorandum" is null and void for purposes of establishing the existence of a valid contract of partnership.

Angeles VS. Sec. Of Justice FACTS: On November 1992, Mercado convinced Angeles spouses to enter into a contract of antichresis (sanglaang-perde), covering 8 parcels of land planted with fruit-bearing lanzones trees located in Laguna and owned by Ivana Sazo. The said contract was to last for 5 years with P210,000 as consideration. Since during only the weekends are the spouses able to go to Laguna, Mercado administered the lands and completed the necessary paper works. Mercado gave accounting only in 1993 and stopped in the year 1995. They discovered that Mercado had put the contract of sanglaang-perde under Mercado and his spouses names. In Mercados counter affidavit, he alleged that there was (sosyo industrial) or industrial partnership agreement between them and that the Angeles spouses are the financiers and Mercado and his spouse as industrial partners. Under the industrial agreement, capital would come from the Angeles spouses while the profit would be divided evenly between Mercado and the Angeles spouses. In the ruling of the Provincial Prosecution Office, it stated that the accusation of estafa lacks enough credible evidentiary support to sustain a prima facie finding. The Angeles spouses appealed on the Secretary of Justice. It was ruled that the crime of estafa cannot be sustained. ISSUE: WON a partnership existed between Mercado and the Angeles spouses. HELD: There was an establishment of partnership between Mercado and the Angeles spouses. There is a contract showing industrial relationship and contribution of money and industry to a common fund, and the division of profits between Angeles spouses and Mercado. Furthermore, the Angeles spouses contributed money to the partnership and not immovable property and the mere failure to register the contract of partnership does not affect the liability of the partnership. The purpose of registration of the COP is to give notice to third parties. Failure to register the COP, does not affect the liability of the partnerships juridical personality. A partnership may exist even if the partners do not use the words partner or partnership.

Lilibeth Sunga Chan vs Lamberto Chua (G.R. No. 143340

August 15, 2001)

FACTS: In 1977, Lamberto Chua verbally entered into a partnership agreement with Jacinto L Sunga, father of petitioner, in the distribution of Shellane Liquefied Petroleum Gas (LPG) in Manila. For business convenience, respondent and Jacinto allegedly agreed to register the business name of their partnership, SHELLITE GAS APPLIANCE CENTER (hereafter Shellite), under the name of Jacinto as a sole proprietorship. Respondent allegedly delivered his initial capital contribution of P100,000.00 to Jacinto while the latter in turn produced P100,000.00 as his counterpart contribution, with the intention that the profits would be equally divided between them. Upon Jacinto's death in the later part of 1989, his surviving wife, petitioner Cecilia and particularly his daughter, petitioner Lilibeth, took over the operations, control, custody, disposition and management of Shellite without respondent's consent. Despite respondent's repeated demands upon petitioners for accounting, inventory, appraisal, winding up and restitution of his net shares in the partnership, petitioners failed to comply. Petitioner Lilibeth allegedly continued the operations of Shellite, converting to her own use and advantage its properties. On March 31, 1991, respondent claimed that after petitioner Lilibeth ran out the alibis and reasons to evade respondent's demands, she disbursed out of the partnership funds the amount of P200,000.00 and partially paid the same to respondent. Petitioner Lilibeth allegedly informed respondent that the P200,000.00 represented partial payment of the latter's share in the partnership, with a promise that the former would make the complete inventory and winding up of the properties of the business establishment. Despite such commitment, petitioners allegedly failed to comply with their duty to account, and continued to benefit from the assets and income of Shellite to the damage and prejudice of respondent. Trial court directed petitioner to render an accounting, to restitute to the partnership all properties, assets, income and profits they misapplied and converted to their own use and advantage, to pay the plaintiff earned but unreceived income and profits from the partnership from 1988 to May 30, 1992, ORDERING them to wind up the affairs of the partnership and terminate its business activities pursuant to law. CA affirmed the decision. ISSUES: WON there exists a partnership HELD: Decision is affirmed. Ratio Decidendi: A partnership may be constituted in any form, except where immovable property of real rights are contributed thereto, in which case a public instrument shall necessary.6 Hence, based on the intention of the parties, as gathered from the FACTS and ascertained from their language and conduct, a verbal contract of partnership may arise.7 The essential profits that must be proven to that a partnership was agreed upon are (1) mutual contribution to a common stock, and (2) a joint interest in the profits.

MAURICIO AGAD vs. SEVERINO MABATO G.R. No. L-24193 June 28, 1968 FACTS: A public instrument dated August 29, 1952 between Mauricio Agad and Severino Mabato forming a partnership to operate a fishpond. Stated in the instrument is that P2,000.00 shall form part of the capital, P1,000.00 coming from each partner. A complaint was filed by Agad in June 9, 1964. It was alleged in the complaint that from 1952 up until 1956, Mabato who handled the funds render accounts to him, and that such accounts were refused to be given by Mabato, despite demands, from 1957 to 1963. Agad prayed for the payment of P14,000.00 as his just share (50%) in the earnings of the partnership, the partnership be dissolved, and a receiver be appointed for the winding up of its business. Mabato denies that such a partnership exist, alleging that Agad never gave his (P1,000) share after the public instrument was made, rendering the contract void ab initio. Magbato subsequently filed a motion to dismiss, alleging that the complaint states no cause of action and lack of jurisdiction as the case is principally to determine rights over public land (the fishpond). The court ruled to dismiss the complaint, stating that the instrument is null and void as Article 1773 of the Civil Code because inventory of the said fish pond was not made. It is not stated in the instrument who contributed the fishpond. Art. 1773. A contract of partnership is void, whenever immovable property is contributed thereto, if inventory of said property is not made, signed by the parties; and attached to the public instrument. ISSUE: Whether Article 1773 is applicable in the case at bar? HELD: No, it is not applicable. It is clear in the instrument that the partnership is to operate a fishpond by contributing P1,000.00 each, and not to engage in the fishpond business, hence, the purpose of the partnership was to operate the fishpond. Neither the fishpond or any real right thereto was contributed to the partnership (as only money was contributed as explicitly stated in the partnership instrument) or ever became part of the capital thereof. Therefore, Article 1773 is not applicable, case is remanded to lower court.

Torres vs CA In 1969, sisters Antonia Torres and Emeteria Baring entered into a joint venture agreement with Manuel Torres. Under the agreement, the sisters agreed to execute a deed of sale in favor Manuel over a parcel of land, the sisters received no cash payment from Manuel but the promise of profits (60% for the sisters and 40% for Manuel) said parcel of land is to be developed as a subdivision. Manuel then had the title of the land transferred in his name and he subsequently mortgaged the property. He used the proceeds from the mortgage to start building roads, curbs and gutters. Manuel also contracted an engineering firm for the building of housing units. But due to adverse claims in the land, prospective buyers were scared off and the subdivisionproject eventually failed. The sisters then filed a civil case against Manuel for damages equivalent to 60% of the value of the property, whichaccording to the sisters, is whats due them as per the contract. The lower court ruled in favor of Manuel and the Court of Appeals affirmed the lower court. The sisters then appealed before the Supreme Court where they argued that there is no partnership between them and Manuel because the joint venture agreement is void. ISSUE: Whether or not there exists a partnership. HELD: Yes. The joint venture agreement the sisters entered into with Manuel is a partnership agreement whereby they agreed to contribute property (their land) which was to be developed as a subdivision. While on the other hand, though Manuel did not contribute capital, he is an industrial partner for his contribution for general expenses and other costs. Furthermore, the income from the said project would be divided according to the stipulated percentage (60-40). Clearly, the contract manifested the intention of the parties to form a partnership. Further still, the sisters cannot invoke their right to the 60% value of the property and at the same time deny the same contract which entitles them to it. At any rate, the failure of the partnership cannot be blamed on the sisters, nor can it be blamed to Manuel (the sisters on their appeal did not show evidence as to Manuels fault in the failure of the partnership). The sisters must then bear their loss (which is 60%). Manuel does not bear the loss of the other 40% because as an industrial partner he is exempt from losses.