1 | P a g e

REVIEWER FOR CASES

ROJAS vs. MAGLANA (192 SCRA 110)
Under the circumstances, the relationship of Rojas and Maglana after the withdrawal of [the
industrial partner] can neither be considered as a de facto partnership, nor a partnership at
will, for as stressed, there is an existing partnership, duly registered.
Rojas therefore affirms two important aspects in !artnership "aw# $irstly, that registration of
the contract of partnership with the %&' has the legal effect of binding the partners (and
perhaps e)en third parties dealing with the partnership*, as to the contractual obligations,
the rights and duties of the partners, and which has effecti)e force e)en as the partnership
undergoes changes within its constitution by the acceptance into and withdrawal of partners
into the )enture. %econdly, the underlying business enterprise, the manner of its operation,
has much legal influence of determining the contractual intents of the partners in the
determination of inter+partnership rights and obligations.
Campos Ruea ! Co v "a#$%$# Comme&#$a' ((( ")$' 91*)
Issue+
,hether or not a limited partnership may be held to ha)e committed an act of insol)ency.
,e'+
-es. . limited partnership/s juridical personality is different from the personality of its
members. 0n general principle, the limited partnership must answer for and suffer the
conse1uence of its acts. Under our 2nsol)ency "aw, one of the acts of ban3ruptcy upon w4c
an adjudication of in)oluntary insol)ency can be predicated is the failure to pay obligations.
5he failure of 'ampos, Rueda 6 'o., to pay its obligations constitutes an act w4c is
specifically pro)ided for in the 2nsol)ency "aw for declaration of in)oluntary insol)ency. 5he
petitioners ha)e a right to a judicial decree declaring the in)oluntary insol)ency of said
partnership.
Tai Tong v Insurance G.R. No. L-55397 February 29, 19
7owe)er, it should be borne in mind that petitioner being a partnership may sue and be
sued in its name or by its duly authori8ed representati)e. !etitioner9s declaration that .rsenio
"ope8 'hua acts as the managing partner of the partnership was corroborated by respondent
insurance company. 5hus 'hua as the managing partner of the partnership may execute all
acts of administration including the right to sue debtors of the partnership in case of their
failure to pay their obligations when it became due and demandable. !ublic respondent9s
allegation that the ci)il case filed by .rsenio 'hua was in his capacity as personal creditor of
spouses !alomo has no basis. 5he policy, then had legal force and effect.
CIR VS. S-.ER
:o, the limited partnership was not dissol)ed.
. husband and a wife may not enter into a contract of generalcopartnership, because under
the 'i)il 'ode, which applies in the absence of express pro)ision in the 'ode of 'ommerce, p
ersons prohibited from ma3ingdonations to each other are prohibited from entering into
uni)ersal partnerships. (;&cha)erri <=>* 2t follows that the marriage of partners necessarily
brings about the dissolution of a pre+existing partnership.
,hat the law prohibits was when the spouses entered into a generalpartnership. 2n the case
at bar, the partnership was limited
ESSENTIAL ELEMENTS:
EVANGELIS.A VS CIR
Issue+
,hether or not petitioners ha)e formed a partnership and conse1uently, are subject to the
tax oncorporations pro)ided for in section ;? of 'ommonwealth .ct. :o. ?>>, otherwise
3nown as the :ational2nternal Re)enue 'ode, as well as to the residence tax for corporations
and the real estate dealers fixed tax.
,e'+
/ES.
5he essential elements of a partnership are two, namely# (a*
a0 a1&eeme02 2o #o02&$3u2e mo0e45 p&ope&24 o& $0us2&4 2o a #ommo0 %u0 @ and (b*
$02e02 2o $v$e 2)e p&o%$2s amo01 2)e #o02&a#2$01 pa&2$es
. 5he first element is undoubtedly present in the case at bar, for, admittedly, petitioners ha)e
agreed to, and did, contribute money and property to a common fund. Upon consideration of
all the facts and circumstances surrounding the case, we are fully satisfied that their purpose
was to engage in real estate transactions for monetary gain and then di)ide the same among
themsel)es, because of the following obser)ations, among others#
(<* %aid common fund was not something they found already in existence@ (;*5hey in)ested
the same, not merely in one transaction, but in a series of transactions@
(A* 5he aforesaid lots were not de)oted to residential purposes, or to other personal uses, of
petitioners herein.
R&.B $&R:.:B&C D% B&". R0%.
50'.0 D% '.
2 | P a g e
ES.ANISLAO VS CA
Indeed, it is true that the latter document is silent as to the statement in the Join Afdait
that the alue re!resents the "ca!ital inestment# o$ the !arties in the %usiness and it s!ea&s
o$ the !etitioner as the sole dealer, %ut this is as it should %e $or in the latter document,
S'ELL (as a signator) and it (ould %e against their !olic) i$ in the agreement it should %e
stated that the %usiness is a !artnershi! (ith !riate res!ondents and not a sole
!ro!rietorshi! o$ the !etitioner*
+urthermore, there are other eidences in the record (hich sho( that there (as in $act such
!artnershi! agreement %et(een !arties* The !etitioner su%mitted to the !riate res!ondents
!eriodic accounting o$ the %usiness and gae a (ritten authorit) to the !riate res!ondent
,emedios Estanislao to e-amine and audit the %oo&s o$ their "common %usiness# .aming
negos)o/* The res!ondent ,emedios, on the other hand, assisted in the running o$ the
%usiness* Indeed, the !arties hereto $ormed a !artnershi! (hen the) %ound themseles to
contri%ute mone) in a common $und (ith the intention o$ diiding the !ro0ts among
themseles*
!"L# $. !%NG &'I%# ()NG
Issue: 1as the agreement a contract a lease or a !artnershi!2
,uling: 3ismissal* The agreement (as a su%lease not a !artnershi!* The $ollo(ing are the
re*uisi+es o, -ar+ners.i-/ 011 t(o or more !ersons (ho bin2 +.e3se4ves +o con+ribu+e
3oney, -ro-er+y or in2us+ry to a co33on ,un24 021 the in+en+ion on the !art o$ the
!artners to 2ivi2e +.e -ro5+s among themseles .Article 1561, 77/
Plainti8 did not $urnish the su!!osed P29,999 ca!ital nor did she $urnish an) hel! or
interention in the management o$ the theatre* Neither has she demanded $rom de$endant
an) accounting o$ the e-!enses and earnings o$ the %usiness* She (as a%solutel) silent (ith
res!ect to an) o$ the acts that a !artner should hae done4 all she did (as to receie her
share o$ P:,999 a month (hich cannot %e inter!reted in an) manner than a !a)ment $or the
use o$ !remises (hich she had leased $rom the o(ners*
S/ vs CA Case 6$1es2
Sa;ot is not an Industrial !artner %ecause (hen he started (or&ing his age (ould not <uali$)
to %e one*
G.R. No. 71089 Sep2em3e& 95 1929
A6RIANO AR:ES5 E. AL.5 plaintiffs+appellees, vs.
VICEN.E "OLIS.ICO5 E. AL.5 defendants+appellants.
With regard to Contributions of an Illegal Partnership: the court holds that E
(<* 5he partner who limits himself to demanding only the amount contributed by
him need not resort to the partnership contract on which to base his action since
said contract does not exist in the eyes of the law, the purpose from which the
contribution was made has not come into existence, and the administrator of the
partnership holding said contribution retains what belongs to others, without any
consideration@ for which reason he is not bound to return it and he who has paid in his share
is entitled to reco)er it.
(;* 0ur 'ode does not state whether, upon the dissolution of the unlawful
partnership, the amounts contributed are to be returned by the partners, because it only
deals with the disposition of the profits@ but the fact that said contributions are not included
in the disposal prescribed profits, shows that in conse1uences of said exclusion, the general
law must be followed, and hence the partners should reimburse the amount of their
respecti)e contributions.
(A* .ny other solution is immoral, and the law will not consent to the latter
remaining in the possession of the manager or administrator who has refused to
return them, by denying to the partners the action to demand them.
With regard to Profits of an Illegal Partnership: the court holds that E
(<* 5he article cited abo)e permits no action for the purpose of obtaining the
earnings made by the unlawful partnership, during its existence as result of the
business in which it was engaged, because for the purpose, the partner will ha)e to base his
action upon the partnership contract, which is to annul and without legal existence by reason
of its unlawful object@ and it is self e)ident that what does not exist cannot be a cause of
action.
(;* !rofits earned in the course of the partnership, because they do not constitute or
represent the partner9s contribution but are the result of the industry, business or
speculation which is the object of the partnership, and therefor, in order to demand the
proportional part of the said profits, the partner would ha)e to base his action on the
contract which is null and )oid, since this partition or distribution of the profits is one of the
juridical effects thereof.
(A* $urthermore, it would be immoral and unjust for the law to permit a profit from an
industry prohibited by it.
FFFFFFFFFFFFFFFFFF
CI./ OF MANILA VS GAM:E
ISS-E+
,hether or not the said !ilots9 .ssociation had debts, credits, or personal property, not
capable of manual deli)ery, in its possession or under its control, belonging to the defendant.
2n other words, did said !ilots9 .ssociation owe to the defendant, a debt or ha)e in its
possession and under its control credits and other personal property, belonging to the
defendant, subject to be attached in accordance with the pro)isions of said section ?A<G
%ection ?A< of the 'ode of !rocedure
: | P a g e
RU"2:H#
:0.
. mere e1uitable or contingent debt, credit, or personal property can be reached by the
procedure pro)ided for in said section (?A<*. (Redondo Ieach 'o. vs. Irewer, <J< 'al., A;;.*
5he said !ilots9 .ssociation is purely a )oluntary association of the pilots of the city of Manila.
5he association is expressly recogni8ed under the law. :o one can become a member of said
association who has not shown special 1ualifications as a pilot, and no one can act as a pilot
who has not been expressly recommended and appro)ed by the collector of the port of
Manila, and no one can become a member of said association without ha)ing paid a certain
sum of money into the treasury of said association. 5his funds becomes the property of the
association for the purpose of protecting its members against losses occasioned by its
members to ships while said ships are under the control of a member or members of said
association. 5he money paid in by one member of said association becomes a part of a
general fund of said association, subject to be paid out for damages done to ships by any
member of the association. 5he fund created by the contributions of the members no longer
belongs to the members of the association@ it belongs to the association. 5he association has
a distinct and separate entity from the indi)idual members who ma3e it up. 5he fund is
created for a specific purpose. (%ee articles AK, A>, AL, and A= of the regulations of said
association.* Under the regulations of said association it has assumed a certain responsibility
for its members. ,hether the damage caused by the defendant in this case is of such a
character for which the said association assumed the responsibility is a 1uestion which the
person injured has a right to test in a special action against said association.
$rom the e)idence that was adduced before the lower court we are of the opinion, and so
hold, that the said association had no debts, credits, or personal property, not capable of
manual deli)ery, in its possession, belonging to the defendant (Hambe*, which are subject to
be attached in accordance with the pro)isions of section ?A<.
5herefore plaintiff ta3es nothing in this action and that the plaintiff be charged with the costs
of both instances.
FFFFFFFF
Tes+ +o 6e+er3ine )7is+ence o, 8ar+ners.i-
L!#N( $( R#()NT#&9
F%&T(
Elser and L)ons are engaged in real estate* The) co=o(ned a !arcel o$ land* Elser (ith the
consent o$ L)ons, mortgaged the !ro!ert) to raise the mone) $or the deelo!ment o$ the San
Juan Estate* L)ons e-!ressed his desire not to %e !art o$ the deelo!ment !ro;ect* The
%usiness !ros!ered* L)ons demand $or a share in the mortgage and in the %usiness claiming
he is a !artner*
I((")/ 1>N L)on is a !artner2
R"LING/
N>* L)ons himsel$ did not (ant to !artici!ate in the deelo!ment !ro;ect* No !artnershi! (as
$ormed* The mortgage o$ the !ro!ert) is immaterial to the issue o$ !artnershi! e-istence*
??????????????
,EA3 PAS7@AL AS 7I,
??????????????
ATT,IB@TES:
,EA3 >,TECA AS AIT@C
?????????
"AR.NERS,I" 6IS.ING-IS,E6 FROM O.,ER :-SINESS ME6IA
;$'os3a4a0 I0# vs .eo%$s2o Gu$01o0a5 J&. 232 SCRA 110 Business
Organization Corporation Law PCSOs Charter
<. 0n issues ;, A, and ?, %ection < of R... :o. <<>=, as amended by I.!. Ilg. ?;,
prohibits the !'%0 from holding and conducting lotteries in collaboration, association or
joint )enture with any person, association, company or entity, whether domestic or
foreign. 5here is undoubtedly a collaboration between !'%0 and !HM' and not merely
a contract of lease. 5he relations between !'%0 and !HM' cannot be defined simply by
the designation they used, i.e., a contract of lease. !ursuant to the wordings of their
agreement, !HM' at its own expense shall 3u$'5 ope&a2e5 a0 ma0a1e 2)e 0e2<o&=
s4s2em including its facilities needed to operate a nationwide online lottery system.
!'%0 bears no ris3 and all it does is to pro)ide its franchise E in )iolation of its charter.
:ecessarily, the use of such franchise by !HM' is a )iolation of .ct :o. AL?>.
FFFFFFF
L-CINA :IGLANGAWA a0 L-CIA ES"IRI.-5 petitioners+appellees,
)s. "AS.OR :. CONS.AN.INO
'0:5&:520: 0$ !.%50R (R&%!0:B&:5*# the agreement whereby he was to be paid a
commission of ;JM on the gross sales and a fee of <JM on the collections made by him,
con)erted him into a partner and ga)e him <4K participation in the property itself. 7ence, he
argues, his suit is one for the settlement and adjustment of partnership interest or a
partition action or proceeding.
ISS-E> WON 2)e '$s pe0e0s 0o2$#e #a0 3e su3?e#2 o% a00o2a2$o0 o% 2)e #omp'a$02 o%
"as2o& Co0s2a02$0o@
D | P a g e
R-LING+
,hile it is true again that the prayer in a complaint does not determine the nature of the
action, it not being a material part of the cause of action, still it logically indicates, as it does
in this case, the purpose of the actor. 5he four paragraphs of the prayer see3s the reco)ery
of fixed amounts of underpayments and commissions and fees@ not li1uidation or accounting
or partition as now insisted upon by appellant.
.ppellants9s amended complaint, not being Nan action affecting the title or the right of
possession of real propertyN,
<
nor one Nto reco)er possession of real estate, or to 1uiet title
thereto, or to remo)e clouds upon the title thereof, or for partition or other proceeding of any
3ind in court affecting the title to real estate or the use or occupation thereof or the buildings
thereon . . .N,
;
the same can not be the basis for annotating a notice of lis pendens on the
title of the petitioners+appellees.
FFFFFFFFFFFFFFFFFFFFF
W,O ARE "AR.NERS@ (AR.. 19*9)
NAVARRO VS CA 222 SCRA *98
5hose personal properties remain to be registered in her name@
ISS-E+
<. ,hether or not there was a partnership that existed between the parties.
;. ,hether the properties that were commonly used in the operation of .llied .ir $reight
belonged to the alleged partnership business.
R-LING+
.rticle <O>O of the :ew 'i)il 'ode defines the contract of partnership#
.rt. <O>O. Iy the contract of partnership two or more persons bind themsel)es to contribute
money, property, or industry to a common fund, with the intention of di)iding the proceeds
among themsel)es.

. cursory examination of the e)idences presented no proof that a partnership, whether oral
or written had been constituted.
2n fact, those mo)ables brought by the plaintiff for the use in the operation of the business
remain registered in her name.
,hile there may ha)e been co+ownership or co+possession of some items and4or any sharing
of proceeds by way of ad)ances recei)ed by both plaintiff and the defendant, these are not
indicati)e and supporti)e of the existence of any partnership between them.
.rt. <O>= par. ; pro)ides#
'o+ownership or co+possession does not of itself establish a partnership, whether such co+
owners or co+possessors do or do not share any profits made by the use of the property
Iesides, the alleged profit was a difference found after e)aluating the assets and not arising
from the real operation of the business. 2n accounting procedures, strictly, this could not be
profit but a net worth.
FFFFFFFFFFFFFFFFFF
O:ILLOS VS CIR
179 SCRA *98
ISS-E
,hether or not the sharing of gross returns constitute partnership
,EL6
+ :0.
+ .rticle <O>=(A* of the 'i)il 'ode pro)ides that Nthe sharing of gross returns does not of
itself establish a partnership, whether or not the persons sharing them ha)e a joint or
common right or interest in any property from which the returns are deri)edN.
+ 5he original intention was merely to collecti)ely purchase the lots and e)entually to
partition them among themsel)es to build their residences@ and that in fact they had no
choice but to resell the same to dissol)e the co+ownership.
0billos found that the di)ision of the profits was merely incidental to the dissolution of the
co+ownership which was in the nature of things a temporary state@ and that there could not
ha)e been any partnership, but merely a co+ownership, since there was lac3 of intent to form
a partnership or joint )enture.
+.ll co+ownerships are not deemed unregistered partnership.
+'o+0wnership who own properties which produce income should not automatically be
considered partners of an unregistered partnership, or a corporation, within the pur)iew of
the income tax law. 5o hold otherwise, would be to subject the income of all co+ownerships
of inherited properties to the tax on corporations, inasmuch as if a property does not produce
an income at all, it is not subject to any 3ind of income tax, whether the income tax on
indi)iduals or the income tax on corporation.
RE/ES VS CIR
2( SCRA 19A
ISS-E+
,hether or not petitioners are subject to the tax on corporations pro)ided for in section ;?
of 'ommonwealth .ct :o. ?>>, otherwise 3nown as the :ational 2nternal Re)enue 'ode.
R-LING+
!etitioners, in ac1uiring the Hibbs Iuilding, established a partnership subject to income tax
as a corporation under the :ational 2nternal Re)enue 'ode.
5here are two essential elements of a partnership#
E | P a g e
(a* an agreement to contribute money, property or industry to a common fund@ and
(b* intent to di)ide the profits among the contracting parties.
2n the case at bar, all elements are undoubtedly present. .dmittedly, petitioners ha)e agreed
to and did, contribute money and property to a common fund. 5heir purpose was to engage
in real estate transactions for monetary gain and then di)ide the same among themsel)es.
REASONS+
<. the common fund being created purposely not something already found in existence@
;. the lots thus ac1uired not being de)oted to residential purposes or to other personal uses
of petitioners@
A. such properties ha)ing been under the management of one person with full power to
lease, to collect rents, to issue receipts, to bring suits, to sign letters and contracts and to
endorse notes and chec3s@
?. petitioners di)iding Ne1ually the income of the building after deducting the expenses of
operation and maintenance thereof@
N$or purposes of the tax on corporations, our :ational 2nternal Re)enue 'ode, include these
partnerships P with the exception only of duly registered general co+partnerships within the
pur)iew of the term Ncorporation.N 2t is, therefore, clear to our mind that petitioners herein
constitute a partnership, insofar as said 'ode is concerned, and are subject to the income
tax for corporations.N
REA6 FOR.IS VS ,ERMANOS
REA6 GA.C,ALIAN VS CIR
BBBBBBBBBB
FORMAL REC-IREMEN.S (AR.S. 1991519A(519925 199751A18)
Sps 6a'$o0 v. CA (1990)
"e2$2$o0e&s+ Spouses 6a'$o0Respo0e02s+
CA a0 Sa3esa?e5 J&."o0e02e+ Me$a'ea5 J.
6o#2&$0e+ . contract of sale is a consensual contract, which means that the sale is perfected
by mere consent. :o particular form isre1uired for its )alidity.
Issue+
,as the contract of sale )alidG 2s a public document needed for transfer of ownershipG
,e'+
:o.
Ra2$o+ Re+ va'$$24 o% 2)e #o02&a#2
!eople who witnessed the execution of the deed positi)ely testified on its authenticity.
5hey stated that it had been executed and signed by the signatories.Re# !ublic document
5he pro)ision of :'' <AKL on the necessity of a public document is only for con)enience, not
for )alidity or enforceability.
5hat this be embodied in a public instrument is not a re1uirement for the )alidity of a
contract of sale of a parcel of land
6a'$o0 a&1ue+
O 5hat the sale is in)alid because it is embodied in a pri)ate document.
O 5hat Nacts and contracts which ha)e for their object the creation, transmission,
modification or extinction of realrights o)er immo)able property must appear in a public
instrument.N (:'' <AKL par. <*
. contract of sale is a consensual contract, which means that the sale is perfected by mere
consent.
O :o particular form is re1uired for its )alidity.
Upon perfection of the contract, the parties may reciprocally demand performance (:''
<?OK, :''*, i.e., the )endee may compel transfer of ownership of the object of the sale, and
the )endor may re1uire the )endee topay the thing sold (:'' <?KL*.
5he trial court thus rightly and legally ordered Balion to deli)er to %abesaje the parcel of
land and to executecorresponding formal deed of con)eyance in a public document.
Under :'' <?=L, when the sale is made through a public instrument, the execution is
e1ui)alent to the deli)ery of the thing.
O Beli)ery may either be actual (real* or constructi)e. 5hus deli)ery of a parcel of land may
be done by placingthe )endee in control and possession of the land (real* or by embodying
the sale in a public instrument (constructi)e*.
6e#$s$o0 a%%$&me.
BBBBBBBBBBBB
REA6 FOR ANGELES VS CA
BBBBBBBBBBBBBBBBBBBB
.ORRES vs. CO-R. OF A""EALS
G.R. No. 17(8895 6e#em3e& 95 1999
Issue+
2s the in)entory of real property contributed in the partnership necessary for the )alidity of
the partnership agreementG
6 | P a g e
,e'+
,e clarify. .rticle <OOA of the 'i)il 'ode was intended primarily to protect third persons.
5hus, the eminent .rturo 5olentino states that under the aforecited pro)ision which is a
complement of .rticle <OO<, the execution of a public instrument would be useless if there
is no in)entory of the property contributed, because without its designation and description,
they cannot be subject to inscription in the Registry of !roperty, and their contribution
cannot prejudice third persons. 5his will result in fraud to those who contract with the
partnership with the belief in the efficacy of the guaranty in which the immo)ables may
consist. 5hus, the contract is declared )oid by law when no such in)entory is made. 5he
case at bar does not in)ol)e third parties who may be prejudiced.
2n short, the alleged nullity of the partnership will not pre)ent courts from
considering the Qoint Denture .greement an ordinary contract from which the parties/ rights
and obligations to each other may be inferred and enforced.
O:LIGA.IONS OF "AR.NERS .O ONE ANO.,ER
FI6-CIAR/ 6-./+
EVANGELIS.A ! CO v. A:A6 SAN.OS (G.R. No. 71*A(> Ju0e 2A5 1997)
ISS-E+
,hether or not .bad %antos is an industrial partner and is entitled to the shares of the
partnershipG
,EL6+
-es. 2t is not disputed that the pro)ision against the industrial partner engaging in business
for himself see3s to pre)ent any conflict of interest between the industrial partner and the
partnership, and to insure faithful compliance by said partner with this prestation. 5hat
appellee has faithfully complied with her prestation with respect to appellants is clearly
shown by the fact that it was only after filing of the complaint in this case and the answer
thereto appellants exercised their right of exclusion under the codal art just mentioned by
alleging in their %upplemental .nswer, subse1uent to the filing of defendants9 answer to the
complaint, defendants reached an agreement whereby the herein plaintiff been excluded
from, and depri)ed of, her alleged share, interests or participation, as an alleged industrial
partner, in the defendant partnership and4or in its net profits or income, on the ground
plaintiff has ne)er contributed her industry to the partnership, instead she has been and still
is a judge of the 'ity 'ourt (formerly Municipal 'ourt* of the 'ity of Manila, de)oting her
time to performance of her duties as such judge and enjoying the pri)ilege and emoluments
appertaining to the said office, aside from teaching in law school in Manila, without the
express consent of the herein defendants9. 7a)ing always 3nows as a appellee as a 'ity
judge e)en before she joined appellant company as an industrial partner, why did it ta3e
appellants many yearn before excluding her from said company as afore1uoted allegationsG
.nd how can they reconcile such exclusi)e with their main theory that appellee has ne)er
been such a partner because N5he real agreement was to grant the appellee a share of AJM
of the net profits which the appellant partnership may reali8e from Qune O, <=KK, until the
mortgage of !AJ,JJJ.JJ obtained from the Rehabilitation $inance 'orporal shall ha)e been
fully paid.
FFFFFFFFFFFFFFF
"RO"ER./ RIG,.S OF A "AR.NER (AR.. 1A10)
RIG,.S IN S"ECIFIC "AR.NERS,I" "RO"ER./ (AR.. 1A11)
Ca2a'a0 Vs. Ga2#)a'$a0
108 ")$' 1290
G.R. No. LD11*(A Ap&$' 225 1989
Issue+
Bid 'atalan/s redemption of the properties ma3e him the absolute owner of the
landsG

Ru'$01+
:o. Under .rticle <LJO of the :'' e)ery partner becomes a trustee for his copartner with
regard to any benefits or profits deri)ed from his act as a partner. 'onse1uently, when
'atalan redeemed the properties in 1uestion, he became a trustee and held the same in trust
for his copartner Hatchalian, subject to his right to demand from the latter his contribution to
the amount of redemption.
"AR.ICI"A.ION IN MANAGEMEN.
-0$2e S2a2es vs Euse3$o C'a&$0
7 Phil 504 Business Organization Partnership, Agency, Trust Co-Partners
ia!ility "isappropriation
ISS-E+
,hether or not the con)iction is correct.
,EL6+
:o. 5he !<O;.JJ ha)ing been recei)ed by the partnership, the business commenced and
profits accrued, the action that lies with the partner who furnished the capital for the
5 | P a g e
reco)ery of his money is not a criminal action for estafa, but a ci)il one arising from the
partnership contract for a li1uidation of the partnership and a le)y on its assets if there
should be any.
5he then !enal 'ode pro)ides that those who are guilty of estafa are those who, to the
prejudice of another, shall appropriate or misapply any money, goods, or any 3ind of
personal property which they may ha)e recei)ed as a deposit on commission for
administration or in any other producing the obligation to deli)er or return the same, (as,
for example, in commodatum, precarium, and other unilateral contracts which re1uire the
return of the same thing recei)ed* does not include money recei)ed for a partnership@
otherwise the result would be that, if the partnership, instead of obtaining profits, suffered
losses, as it could not be held liable ci)illy for the share of the capitalist partner who reser)ed
the ownership of the money brought in by him, it would ha)e to answer to the charge of
estafa, for which it would be sufficient to argue that the partnership had recei)ed the money
under obligation to return it.
BBBBBBBBBBBBBBB
REA6 LI..ON ,ILL VS CERON
ACCESS .O "AR.NERS,I" :OO;S
AN.ONIO "AR6O v..,E ,ERC-LES L-M:ER a0 IGNACIO FERRER
I2 ma4 3e am$22e 2)a2 2)e o%%$#$a's $0 #)a&1e o% a #o&po&a2$o0 ma4 e04
$0spe#2$o0 <)e0 sou1)2 a2 u0usua')ou&s o& u0e& o2)e& $mp&ope& #o0$2$o0s> 3u2
0e$2)e& 2)e eEe#u2$ve o%%$#e&s 0o& 2)e 3oa& o% $&e#2o&s )ave2)e po<e& 2o ep&$ve a
s2o#=)o'e& o% 2)e &$1)2 a'2o1e2)e&.

A 34D'a< u0u'4 &es2&$#2$01 2)e &$1)2 o% $0spe#2$o0$s u0ou32e'4 $0va'$.
Under a statute similar to our own it has been held that the statutory right of inspection
is notaffected by the adoption by the board of directors of a resolution pro)iding for the
closing of transfer boo3s thirty daysbefore an election.0ur statute declares that the right of
inspection can be exercised Nat reasonable hours.N
.)$s mea0s a2 &easo0a3'e)ou&s o0 3us$0ess a4s 2)&ou1)ou2 2)e 4ea&5 a0 0o2
me&e'4 u&$01 some a&3$2&a&4 pe&$o o% a %e< a4s#)ose0 34 2)e $&e#2o&s.
BBBBBBBBBB
G.R. No. 9092* Ja0ua&4 715 19A96AN F-E LE-NG5 pe2$2$o0e&5vs.,ON.
IN.ERME6IA.E A""ELLA.E CO-R. a0 LE-NG /I-5 &espo0e02s.
ISS-E+
,0: the pri)ate respondent is a partner of the petitioner in the establishment of %un ,ah
!anciteria.
,EL6+
2n essence, the pri)ate respondent alleged that when %un ,ah !anciteria was established, he
ga)e !?,JJJ.JJ to thepetitioner with the understanding that he would be entitled to twenty+
two percent (;;M* of the annual profit deri)edfrom the operation of the said panciteria.
5hese allegations, which were pro)ed, ma3e the pri)ate respondent and thepetitioner
partners in the establishment of %un ,ah !anciteria because .rticle <O>O of the 'i)il 'ode
pro)ides thatNIy the contract of partnership two or more persons bind themsel)es to
contribute money, property or industry to acommon fund, with the intention of di)iding the
profits among themsel)esN.5herefore, the lower courts did not err in construing the
complaint as one wherein the pri)ate respondent asserted hisrights as partner of the
petitioner in the establishment of the %un ,ah !anciteria, notwithstanding the use of the
termfinancial assistance therein.%' affirmed appellate courtRs decision and ordered the
dissolution of the partnership.
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RELA.IONS AN6 6EALINGS WI., .,IR6 "ERSONS
IN6IVI6-AL LIA:ILI./ OF "AR.NERS FOR "AR.NERS,I" AC.S
Is'a0 Sa'es vs -0$2e "$o0ee&s Ge0e&a' Co0s2&u#2$o0 Compa04 e2 a'
Business Organization Partnership! "gency! #rust $iability of Partners Pro%rata
Condonation
FAC.S+
United !ioneers Heneral 'onstruction 'ompany is a general partnership formed by Ienjamin
Baco, Baniel Hui8ona, :oel %im, .ugusto !alisoc and Romulo "umauig. 2n <=><, United
!ioneers purchased by installment a motor )ehicle from 2sland %ales, 2nc. United !ioneers
defaulted in its payment hence it was sued and the K partners were impleaded as co+
defendants.
Upon motion of 2sland %ales, "umauig was remo)ed as a defendant.
United !ioneers lost the ci)il case and the trial court rendered judgment ordering United
!ioneers to pay the outstanding balance plus interest and costs. 2t further decreed that the
remaining ? co+defendants shall pay 2sland %ales in case United !ioneers/ property will not
be enough to satisfy its indebtedness to 2sland %ales.
ISS-E+
,hat is the extent of the liability of the partners considering that one partner was remo)ed
as a co+defendant on motion of 2sland %alesG
,EL6+
F | P a g e
5heir liability is pro+rata pursuant to .rticle <L<> of the 'i)il 'ode. Iut is should be noted
that since there were K partners when the purchase was made in behalf of the partnership,
the liability of each partner should be <4K
th
(of the company/s obligation* each. 5he fact that
the complaint against "umauig was dismissed, upon motion of the 2sland %ales, does not
unma3e "umauig as a general partner in the company. 2n so mo)ing to dismiss the
complaint, 2sland %ales merely condoned "umauig/s indi)idual liability to them.
++++++++++++++++++++++++
Au&e'$o L$2o0?ua J& vs Eua&o L$2o0?ua S&. e2 a'
Business Organization Partnership, Agency, Trust Partnership, ho# $or%e&
Au&e'$o a0 Eua&o a&e 3&o2)e&s. I0 19975 Au&e'$o a''e1e 2)a2 Eua&o e02e&e
into a contract of partnership with him. .urelio showed as e)idence a letter sent to him by
&duardo that the latter is allowing .urelio to manage their family business (if &duardo/s
away* and in exchange thereof he will be gi)ing .urelio !< million or <JM e1uity, whiche)er
is higher. . memorandum was subse1uently made for the said partnership agreement. 5he
memorandum this time stated that in exchange of .urelio, who just got married, retaining
his share in the family business (mo)ie theatres, shipping and land de)elopment* and some
other immo)able properties, he will be gi)en !< Million or <JM e1uity in all these businesses
and those to be subse1uently ac1uired by them whiche)er is greater.
2n <==; howe)er, the relationship between the brothers went sour. .nd so .urelio demanded
an accounting and the li1uidation of his share in the partnership. &duardo did not heed and
so .urelio sued &duardo.
ISS-E+ W)e2)e& o& 0o2 2)e&e eE$s2s a pa&20e&s)$p.
,EL6+
No.
5he partnership is )oid and legally nonexistent. 5he documentary e)idence presented by
.urelio, i.e. the letter from &duardo and the Memorandum, did not pro)e partnership.
5he <=OA letter from &duardo on its face, contains typewritten entries, personal in tone, but
is unsigned and undated. .s an unsigned document, there can be no 1uibbling that said
letter does not meet the public instrumentation re1uirements exacted under .rticle <OO<
(how partnership is constituted* of the 'i)il 'ode. Moreo)er, being unsigned and doubtless
referring to a partnership in)ol)ing more than !A,JJJ.JJ in money or property, said
letter cannot be presented for notari8ation, let alone registered with the %ecurities and
&xchange 'ommission (%&'*, as called for under the .rticle <OO; (capitali8ation of a
partnership* of the 'ode. .nd inasmuch as the in)entory re1uirement under the succeeding
.rticle <OOA goes into the matter of )alidity when immo)able property is contributed to the
partnership, the next logical point of in1uiry turns on the nature of .urelio/s contribution, if
any, to the supposed partnership.
5he Memorandum is also not a proof of the partnership for the same is not a public
instrument and again, no in)entory was made of the immo)able property and no in)entory
was attached to the Memorandum. .rticle <OOA of the 'i)il 'ode re1uires that if immo)able
property is contributed to the partnership an in)entory shall be had and attached to the
contract.