Complete Case Digest PARTNERSHIP and AGENCY

8/13/2019 Complete Case Digest PARTNERSHIP and AGENCY

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PARTNERSHIP and AGENCY

II. NATURE and CHARACTERISTICS

TOCAO and BELO v CA and ANAY - Mike

William Belo introduced Nenita Anay to his girlfriend, Marjorie Tocao. The threeagreed to form a JV for the sale of cooking wares. Belo was to contriute !".#million$ Tocao also contriuted some cash and she shall also act as %resident and&M$ and Anay shall e in charge of marketing. Belo and Tocao s%ecifically asked

Anay ecause of her e'%erience and connections as a marketer. They agreedfurther that Anay shall recei(e the following)

*+ share of annual net %rofits -- o(erriding commission for weekly sales --/+ of sales Anay will make herself -- " share for her demo ser(ices

They o%erated under the name &eminesse 0nter%rise, this name was howe(erregistered as a sole %ro%rietorshi% with the Bureau of 1omestic Trade under Tocao.The JVA was not reduced to writing ecause Anay trusted Belo2s assurances.

The (enture succeeded under Anay2s marketing %rowess. But then Anay andTocao2s relationshi% soured. 3ne day, Tocao ad(ised one of the ranch managersthat Anay was no longer a %art of the com%any. Anay then demanded that thecom%any e audited 4 her shares gi(en to her.

ISSUE: Whether or not there is a %artnershi%.

HELD: 5es, though not reduced to writing, for a %artnershi% can e instituted in anyform. The fact that it was registered as a sole %ro%rietorshi% is of no moment forsuch registration was only for its trade name.

Anay was not e(en an em%loyee ecause when they (entured into the agreement,

they e'%licitly agreed to %rofit sharing this is e(en though Anay was recei(ingcommissions ecause this is only incidental to her efforts as a head marketer.

The 6u%reme 7ourt also noted that a %artner who is e'cluded wrongfully from a%artnershi% is an innocent %artner. 8ence, the guilty %artner must gi(e him his dueu%on the dissolution of the %artnershi% as well as damages or share in the %rofits9reali:ed from the a%%ro%riation of the %artnershi% usiness and goodwill.; Aninnocent %artner thus %ossesses 9%ecuniary interest in e(ery e'isting contract thatwas incom%lete and in the trade name of the co?, no longer the(ice


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Ne(ertheless, the %artnershi% was not terminated therey$ it continues until thewinding u% of the usiness.

NOTE: Motion for @econsideration filed y Tocao and Belo decided y the 67 on6e%temer "+, "++*.

Belo is not a %artner. Anay was not ale to %ro(e that Belo in fact recei(ed %rofits

from the com%any. Belo merely acted as a guarantor. 8is %artici%ation in theusiness meetings was not as a %artner ut as a guarantor. 8e in fact had onlylimited %artnershi%. Tocao also testified that Belo recei(ed nothing from the %rofits.67 also noted that the %artnershi% was yet to e registered in the 607. As such, itwas understandale that Belo, who was after all %etitioner Tocao2s good friend andconfidante, would occasionally %artici%ate in the affairs of the usiness, thoughne(er in a formal or official ca%acity.

TORRES v CA

n *==, sisters Antonia Torres and 0meteria Baring entered into a joint (entureagreement with Manuel Torres. nder the agreement, the sisters agreed to e'ecute

a deed of sale in fa(or Manuel o(er a %arcel of land, the sisters recei(ed no cash%ayment from Manuel ut the %romise of %rofits C+ for the sisters and D+ forManuelE F said %arcel of land is to e de(elo%ed as a sudi(ision.

Manuel then had the title of the land transferred in his name and he thereaftermortgaged the %ro%erty. 8e used the %roceeds from the mortgage to start uildingroads, curs and gutters. Manuel also contracted an engineering firm for the uildingof housing units. But due to ad(erse claims in the land, %ros%ecti(e uyers werescared off and the sudi(ision %roject e(entually failed.

The sisters then filed a ci(il case against Manuel for damages eGui(alent to + of

the (alue of the %ro%erty, which according to the sisters, is what2s due them as %erthe contract.

The lower court ruled in fa(or of Manuel and the 7ourt of A%%eals affirmed the lowercourt.

The sisters then a%%ealed efore the 6u%reme 7ourt where they argued that there isno %artnershi% etween them and Manuel ecause the joint (enture agreement is(oid.

ISSUE: Whether or not there e'ists a %artnershi%.

HELD: 5es. The joint (enture agreement the sisters entered into with Manuel is a%artnershi% agreement wherey they agreed to contriute %ro%erty Ctheir landE whichwas to e de(elo%ed as a sudi(ision. While on the other hand, though Manuel didnot contriute ca%ital, he is an industrial %artner for his contriution for generale'%enses and other costs. Hurthermore, the income from the said %roject would edi(ided according to the sti%ulated %ercentage C+


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cannot in(oke their right to the + (alue of the %ro%erty and at the same time denythe same contract which entitles them to it.

At any rate, the failure of the %artnershi% cannot e lamed on the sisters, nor can ite lamed to Manuel Cthe sisters on their a%%eal did not show e(idence as to

Manuel2s fault in the failure of the %artnershi%E. The sisters must then ear their lossCwhich is +E. Manuel does not ear the loss of the other D+ ecause as anindustrial %artner he is e'em%t from losses.

Lim Ton Lim v P!i" #i$!in Gea% Ind. In& ' Bian&a

G.R. No. 136448 November 3, 1999LIM TONG LIM, petitioner, vs. PHILIPPINE I!HING GE"R IN#$!TRIE!,

IN%., respon&ent.

A partnership may be deemed to exist among parties who agree to borrowmoney to pursue a business and to divide the profits or losses that may arisetherefrom, even if it is shown that they have not contributed any capital of theirown to a "common fund." Their contribution may be in the form of credit orindustry, not necessarily cash or fixed assets. Being partner, they are all liablefor debts incurred by or on behalf of the partnership. The liability for a contractentered into on behalf of an unincorporated association or ostensiblecorporation may lie in a person who may not have directly transacted on itsbehalf, but reaped benefits from that contract.

'(ts)On behalf of "Ocean Quest ishing !orporation," Antonio !hua and eter #aoentered into a !ontract for the purchase of fishing nets of various si$es fromthe hilippine ishing %ear &ndustries, &nc. 'respondent(. They claimed thatthey were engaged in a business venture with etitioner )im Tong )im, who

however was not a signatory to the agreement. The buyers, however, failed topay for the fishing nets and the floats.

*espondent then filed a collection suit against !hua, #ao and etitioner )imTong )im. The suit was brought against the three in their capacities as generalpartners, on the allegation that "Ocean Quest ishing !orporation" was a


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nonexistent corporation as shown by a !ertification from the +ecurities andxchange !ommission.

T! - !hua, #ao and )im, as general partners 'of Ocean Quest ishing

!orporation(, were ointly liable to pay respondent.

CA-affirmed

I!!$E)/O0 by their acts, )im, !hua and #ao could be deemed to haveentered into a partnership1

HELD: YES.

The facts as found by the two lower courts clearly showed that there existed apartnership among !hua, #ao and him, pursuant to Article 2343 of the !ivil!ode which provides5

Art. 2343 6 By the contract of partnership, two or more persons bindthemselves to contribute money, property, or industry to a common fund, withthe intention of dividing the profits among themselves.

!hua, #ao and )im had decided to engage in a fishing business, which theystarted by buying boats worth 7.78 million, financed by a loan secured from

9esus )im who was petitioner:s brother. &n their !ompromise Agreement, theysubse;uently revealed their intention to pay the loan with the proceeds of thesale of the boats, and to divide e;ually among them the excess or loss. Theseboats, the purchase and the repair of which were financed with borrowedmoney, fell under the term "common fund" under Article 2343. The contributionto such fund need not be cash or fixed assets< it could be an intangible li=ecredit or industry. That the parties agreed that any loss or profit from the saleand operation of the boats would be divided e;ually among them also showsthat they had indeed formed a partnership.

>oreover, it is clear that the partnership extended not only to the purchase ofthe boat, but also to that of the nets and the floats. The fishing nets and thefloats, both essential to fishing, were obviously ac;uired in furtherance of theirbusiness. &t would have been inconceivable for )im to involve himself so muchin buying the boat but not in the ac;uisition of the aforesaid e;uipment,

without which the business could not have proceeded.


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%iven the preceding facts, it is clear that there was, among petitioner, !huaand #ao, a partnership engaged in the fishing business. They purchased theboats, which constituted the main assets of the partnership, and they agreed

that the proceeds from the sales and operations thereof would be dividedamong them.

B. !artnershi% as a 7ontract < Art. *?=

(a%an)i""a (% v (a%an)i""a ' *%i$

HA7T6)The %resent case stems from the com%laint filed y Antonieta Jarantilla againstBuena(entura @emotigue, 7ynthia @emotigue, Hederico Jarantilla, Jr., 1oroteoJarantilla and Tomas Jarantilla, for the accounting of the assets and income of thecoE, and for damages. Antonieta claimed that in *=D, she had enteredinto an agreement with the defendants to engage in usiness through the e'ecutionof a document denominated as IAcknowledgement of !artici%ating 7a%ital;.

Antonieta also alleged that she had hel%ed in the management of the usiness theyco


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first element is undoutedly %resent in the case at ar, for, admittedly, all the %artiesin this case ha(e agreed to, and did, contriute money and %ro%erty to a commonfund. 8ence, the issue narrows down to their intent in acting as they did. t is notdenied that all the %arties in this case ha(e agreed to contriute ca%ital to a commonfund to e ale to later on share its %rofits. They ha(e admitted this fact, agreed to

its (eracity, and e(en sumitted one documentary e(idence to %ro(e such%artnershi% < the Acknowledgement of !artici%ating 7a%ital. The %etitioner himselfclaims his share to e , as stated in the Acknowledgement of !artici%ating7a%ital. 8owe(er, %etitioner fails to reali:e that this document s%ecificallyenumerated the usinesses co(ered y the %artnershi%) Manila Athletic 6u%%ly,@emotigue Trading in loilo 7ity and @emotigue Trading in 7otaato 7ity. 6incethere was a clear agreement that the ca%ital the %artners contriuted went to thethree usinesses, then there is no reason to de(iate from such agreement and goeyond the sti%ulations in the document. There is no e(idence that the suject real%ro%erties were assets of the %artnershi% referred to in the Acknowledgement of!artici%ating 7a%ital. !etition denied.

&.@. No. *?"=+ March /, "+*+

80@6 3H J360 M, re%resented y 00NT3 M, !etitioners,

(s.

J0T VA M, @es%ondent.

1 0 7 6 3 N

NA78@A, J.)

Hacts)

!etitioners are the heirs of the late Jose im CJoseE. They filed a 7om%laint for!artition, Accounting and 1amages against res%ondent Juliet Villa im Cres%ondentE,widow of the late 0lfledo im C0lfledoE, who was the eldest son of Jose and7resencia.


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Jose, together with his friends, formed a %artnershi% to engage in the truckingusiness. Jose managed the o%erations of this trucking usiness until his death.Thereafter, JoseKs heirs, including 0lfledo, and %artners agreed to continue theusiness under the management of 0lfledo.

!etitioners also alleged that 0lfledo was ne(er a %artner or an in(estor in theusiness and merely su%er(ised the %urchase of additional trucks using the incomefrom the trucking usiness of the %artners.

0lfledo died, lea(ing res%ondent as his sole sur(i(ing heir. !etitioners claimed thatres%ondent took o(er the administration of the aforementioned %ro%erties, whichelonged to the estate of Jose, without their consent and a%%ro(al.

@es%ondent claimed that 0lfledo was himself a %artner of Norerto and Jimmy.@es%ondent also claimed that %er testimony of 7resencia, Jose ga(e 0lfledo!#+,+++.++ as the latterKs ca%ital in an informal %artnershi% with Jimmy andNorerto.

@es%ondent also alleged that when Jose died, he left no known assets, and the%artnershi% with Jimmy and Norerto ceased u%on his demise.

n essence, %etitioners argue that according to the testimony of Jimmy, the solesur(i(ing %artner, 0lfledo was not a %artner$ and that he and Norerto entered into a%artnershi% with Jose.

ssue)

Was there a %artnershi%L

8eld)

We find that the instant !etition is ereft of merit.


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A %artnershi% e'ists when two or more %ersons agree to %lace their money, effects,laor, and skill in lawful commerce or usiness, with the understanding that thereshall e a %ro%ortionate sharing of the %rofits and losses among them. A contract of%artnershi% is defined y the 7i(il 7ode as one where two or more %ersons indthemsel(es to contriute money, %ro%erty, or industry to a common fund, with the

intention of di(iding the %rofits among themsel(es.ndoutedly, the est e(idence would ha(e een the contract of %artnershi% or thearticles of %artnershi%. nfortunately, there is none in this case, ecause the alleged%artnershi% was ne(er formally organi:ed. Nonetheless, we are asked to determinewho etween Jose and 0lfledo was the I%artnerI in the trucking usiness.

0lfledo was not just a hired hel% ut one of the %artners in the trucking usiness,acti(e and (isile in the running of its affairs from day one until this ceasedo%erations u%on his demise. The e'tent of his control, administration and

management of the %artnershi% and its usiness, the fact that its %ro%erties were%laced in his name, and that he was not %aid salary or other com%ensation y the%artners, are indicati(e of the fact that 0lfledo was a %artner and a controlling one atthat. t is a%%arent that the other %artners only contriuted in the initial ca%ital uthad no say thereafter on how the usiness was ran. 0(idently it was through0lfredo2s efforts and hard work that the %artnershi% was ale to acGuire more trucksand otherwise %ros%er. 0(en the a%%ellant %artici%ated in the affairs of the%artnershi% y acting as the ookkee%er sans salary.*a((%hi*

t is notale too that Jose im died when the %artnershi% was arely a year old, and

the %artnershi% and its usiness not only continued ut also flourished. f it were truethat it was Jose im and not 0lfledo who was the %artner, then u%on his death the%artnershi% should ha(e een dissol(ed and its assets liGuidated. 3n the contrary,these were not done ut instead its o%eration continued under the helm of 0lfledoand without any %artici%ation from the heirs of Jose im.

P!i"e+ Minin Co%, v CIR ' Ba"d%

Facts: Petitioner Philex entered into an agreement with Baguio Gold Mining

Corporation for the former to manage the latters mining claim know as the Sto.Mine. he parties agreement was denominated as !Power of "ttorne#$. he minesuffered continuing losses o%er the #ears& which resulted in petitioners withdrawal

as manager of the mine. he parties executed a !Compromise 'ation in Pa#ment$&wherein the de(t of Baguio amounted to Php. ))*&)+,&---.--. Petitioner deducted

said amount from its gross income in its annual tax income return as !loss on thesettlement of recei%a(les from Baguio Gold against reser%es and allowances$. B/disallowed the amount as deduction for (ad de(t. Petitioner claims that it entered acontract of agenc# e%idenced (# the !power of attorne#$ executed (# them and the


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ad%ances made (# petitioners is in the nature of a loan and thus can (e deductedfrom its gross income. Court of ax "ppeals 0C"1 re2ected the claim and held that

it is a partnership rather than an agenc#. C" affirmed C"

ssue: 3hether or not it is an agenc#.

4eld: 5o. he lower courts correctl# held that the !Power of "ttorne#$ 0P"1 is theinstrument material that is material in determining the true nature of the (usiness

relationship (etween petitioner and Baguio. "n examination of the said P" re%ealsthat a partnership or 2oint %enture was indeed intended (# the parties. 3hile a

corporation like the petitioner cannot generall# enter into a contract of partnershipunless authori6ed (# law or its charter& it has (een held that it ma# enter into a

2oint %enture& which is akin to a particular partnership. he P" indicates that theparties had intended to create a P" and esta(lish a common fund for the purpose.

he# also had a 2oint interest in the profits of the (usiness as shown (# the 7-87-sharing of income of the mine.

Moreo%er& in an agenc# coupled with interest& it is the agenc# that cannot (ere%oked or withdrawn (# the principal due to an interest of a third part# thatdepends upon it or the mutual interest of (oth principal and agent. n this case thenon8re%ocation or non8withdrawal under the P" applies to the ad%ances made (#

the petitioner who is the agent and not the principal under the contract. hus& itcannot (e inferred from the stipulation that it is an agenc#.

San)o$ v S,o$e$ Ree$' Pa)

n June *=>, Hernando 6antos C?+E, Nie(es @eyes C*#E, and Melton aatC*#E orally instituted a %artnershi% with them as %artners. Their (enture is to set u%a lending usiness where it was agreed that 6antos shall e financier and thatNie(es and aat shall contriute their industry. **The percentages after theirnames denote their share in the profit.

ater, Nie(es introduced 7esar &ragera to 6antos. &ragera was the chairman of acor%oration. t was agreed that the %artnershi% shall %ro(ide loans to the em%loyeesof &ragera2s cor%oration and &ragera shall earn commission from loan %ayments.

n August *=>, the three %artners %ut into writing their (eral agreement to form the%artnershi%. As earlier agreed, 6antos shall finance and Nie(es shall do the dailycash flow more %articularly from their dealings with &ragera, aat on the otherhand shall e a loan in(estigator. But then later, Nie(es and 6antos found out thataat was engaged in another lending usiness which com%etes with their%artnershi% hence aat was e'%elled.

The two continued with the %artnershi% and they took with them Nie(es2 husand,Arsenio, who ecame their loan in(estigator.


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ater, 6antos accused the s%ouses of not remitting &ragera2s commissions to thelatter. 8e sued them for collection of sum of money. The s%ouses countered that6antos merely filed the com%laint ecause he did not want the s%ouses to get theirshares in the %rofits. 6antos argued that the s%ouses, insofar as the dealing with&ragera is concerned, are merely his em%loyees. 6antos alleged that there is a

distinct %artnershi% etween him and &ragera which is se%arate from the%artnershi% formed etween him, aat and Nie(es.

The trial court as well as the 7ourt of A%%eals ruled against 6antos and ordered thelatter to %ay the shares of the s%ouses.

660) Whether or not the s%ouses are %artners.

801) 5es. Though it is true that the original %artnershi% etween aat, 6antosand Nie(es was terminated when aat was e'%elled, the said %artnershi% washowe(er considered continued when Nie(es and 6antos continued engaging asusual in the lending usiness e(en getting Nie(es2 husand, who resigned from the

Asian 1e(elo%ment Bank, to e their loan in(estigator F who, in effect, sustituted

aat.There is no se%arate %artnershi% etween 6antos and &ragera. The latter eingmerely a commission agent of the %artnershi%. This is e(en though the %artnershi%was formali:ed shortly after &ragera met with 6antos CNote that Nie(es was e(enthe one who introduced &ragera to 6antos e'actly for the %ur%ose of setting u% alending agreement etween the cor%oration and the %artnershi%E.

83W0V0@, the order of the 7ourt of A%%eals directing 6antos to gi(e the s%ousestheir shares in the %rofit is %remature. The accounting made y the trial court isased on the 9total income; of the %artnershi%. 6uch total income calculated y thetrial court did not consider the e'%enses sustained y the %artnershi%. All e'%enses

incurred y the money


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!etitioner William Belo introduced res%ondent NenitaAnay to %etitioner

Marjorie Tocao, who con(eyed her desire to enter into a joint(enture with her for the

im%ortation and local distriution of kitchen cookwares. nder the joint (enture,Belo acted as ca%italist, Tocao as%resident and general manager, and Anay as headof the marketing de%artment and later, (ice


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5es. The issue of whether or not a %artnershi% e'ists is a factual matter which iswithin the e'clusi(e domain of oth the trial anda%%ellate courts. This 7ourt cannotset aside factual findings of such courts asent any showing that there is noe(idence to su%%ort theconclusion drawn y the courta Guo.

n this case, oth the trial court and the 7ourt of A%%eals are one in ruling that

%etitioners and %ri(ateres%ondent estalished a usiness %artnershi%. This 7ourtfinds no reason to rule otherwise. To e considered a juridical %ersonality,a%artnershi% must fulfill these reGuisites) C*E two or more %ersons ind themsel(es

to contriute money, %ro%erty or industry to a commonfund$ and C"E intention on the

%art of the %artners to di(ide the %rofits among themsel(es.

t may e constituted in any form$ a %ulicinstrument is necessary only

where immo(ale %ro%erty or real rights are contriuted thereto.

This im%lies that since a contract of %artnershi% is consensual, an oral contract of%artnershi% is as good as a written one. Where no immo(ale %ro%erty or real rightsarein(ol(ed, what matters is that the %arties ha(e com%lied with the reGuisites of a%artnershi%. The fact that there a%%ears to e no record in the6ecurities and0'change 7ommission of a %ulic instrument emodying the %artnershi% agreement%ursuant to Article *??" of the 7i(il 7ode did not cause the nullification of the%artnershi%. The %ertinent %ro(ision of the 7i(il 7ode on the matter states)Art. *?>.The %artnershi% has a juridical %ersonality se%arate and distinct from that of each ofthe %artners, e(en in case of failure to com%lywith the reGuirements of article *??",first %aragra%h.

DISPOSITION:

6HERE#ORE, the instant %etition for re(iew on certiorari is 10N01. The%artnershi% among %etitioners and %ri(ate res%ondent is ordered dissol(ed, and

the %arties are ordered to effect the winding u% and liGuidation of the%artnershi% %ursuant to the %ertinent %ro(isions of the 7i(il 7ode. This case is

remanded to the @egional Trial 7ourt for %ro%er %roceedings relati(e to saiddissolution. The a%%ealed decisions of the @egional Trial 7ourt and the 7ourtof A%%eals are AHH@M01 with M31H7AT3N6, as follows , %ursuant to Article *>+= of the7i(il 7ode, in order to determine %ri(ate res%ondent2s ten %ercent C*+E share in thenet %rofits of the %artnershi%$

". !etitioners are ordered, jointly and se(erally, to %ay %ri(ate res%ondent fi(e

%ercent C#E o(erriding commission for the one hundred and fifty C*#+E cookwaresets a(ailale for dis%osition since the time %ri(ate res%ondent was wrongfullye'cluded from the %artnershi% y %etitioners$

/. !etitioners are ordered, jointly and se(erally, to %ay %ri(ate res%ondent o(erridingcommission on the total %roduction which, for the %eriod co(ering January >, *=>> toHeruary #, *=>>, amounted to !/",+++.++$


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D. !etitioners are ordered, jointly and se(erally, to %ay %ri(ate res%ondent moraldamages in the amount of !#+,+++.++, e'em%lary damages in the amount of!#+,+++.++ and attorney2s fees in the amount of !"#,+++.++.

7OTE: *st di(ision. Davide, Jr., C.J., (Chairman), Puno, Kapunan, and Pardo, JJ.,concur.

A#ISCO In$%an&e Co%,o%a)ion v. CA - Mike!ursuant to 9reinsurance treaties,; a numer of local insurance firms formedthemsel(es into a9%ool; in order to facilitate the handling of usiness contracted witha non resident foreignreinsurance com%any.

After assessing their sumitted financial statement, the B@ 7ommissioner reGuiredthem to %ay deficiency ta'es on the ground that they ha(e formed an unregistered%artnershi% ta'ale as a cor%oration

---AH673) there was no %artnershi%

The reinsurance %olicies were written y them indi(idually and se%arately

Their liaility was limited to the e'tent of their allocated share in the original risksthusreinsured

They did not share the same risk or solidary liaility

There was no common fund

The e'ecuti(e oard of the %ool did not e'ercise control and management of itsfunds,unlike the oard of directors of a cor%oration

The %ool or clearing house was not and could not %ossily ha(e engaged in theusinessof reinsurance from which it could ha(e deri(ed income for itself

---7A) a %artnershi% was formedI$$e: W3N the %ool or clearing house was a %artnershi% or association suject tota' as a cor%oration

He"d: 5es, it is. The !hili%%ine legislature included in the conce%t of cor%orationsthose entities that resemled them such as unregistered %artnershi%s andassociations.

!arenthetically, the N@72s inclusion of such entities in the ta' on cor%orationswas made e(en clearer y the Ta' @eform Act of *==?, which amended the Ta'7ode

67) the term %artnershi% includes syndicate, grou%, %ool, joint (enture and

otherunincor%orated organi:ation, through or y means of which any usiness,financial o%eration, or(enture is carried on C0(angelista (. 7ollector of nternal@e(enueE

Art. *?? of the 7i(il 7ode) reGuisite of a contract of %artnershi% Two or more%ersons mutually contriute to a common fund With the intention to di(ide the %rofitsamong themsel(es


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E7ANGELISTA v CIR 89; - Mike

!etitioners orrowed sum of money from their father and together with their own%ersonal funds they used said money to uy se(eral real %ro%erties. They then

a%%ointed their rother C6imeonE as manager of the said real %ro%erties with %owersand authority to sell, lease or rent out said %ro%erties to third %ersons. They reali:edrental income from the said %ro%erties for the %eriod *=D#


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YULO 7. YANG CHIAO SENG - Mike5ang 7hiao 6eng %ro%osed to form a %artnershi% with @osario 5ulo to run ando%erate a theatre on the %remises occu%ied y 7ine 3ro, !la:a 6ta. 7ru:, Manila,w- the ff %rinci%al conditions) C*E 5ang guarantees 5ulo a monthly %artici%ation of!/,+++ C"E %artnershi% shall e for a %eriod of " years and months with the

condition that if the land is e'%ro%riated, rendered im%racticale for usiness, ownerconstructs a %ermanent uilding, then 5ulo2s right to lease and %artnershi% e(en if%eriod agreed u%on has not yet e'%ired$ C/E 5ulo is authori:ed to %ersonally conductusiness in the loy of the uilding$ and CDE after 1ec /*, *=D?, all im%ro(ements%laced y %artnershi% shall elong to 5ulo ut if %artnershi% is terminated eforela%se of * and P years, 5ang shall ha(e right to remo(e im%ro(ements. !artiesestalished, 95ang and 7o. td.;, to e'ist from July *, *=D# F 1ec /*, *=D?.n June *=D, they e'ecuted a su%lemntry agreement e'tending the %artnershi% for/ years Q from *-*-*=D> to *"-/*-*=#*The land on which the theater was constructed was leased y 5ulo from owners,0milia 7arrion and Maria 7arrion 6anta Marina for an indefinite %eriod ut that after

* year, such lease may e cancelled y either %arty u%on =+i$i)e$ o< ,a%)ne%$!i,:?8@two or more %ersons who /ind )!em$e"ve$)o &on)%i/)e mone, ,%o,e%) o% ind$)%to a &ommon


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recei(e her share of !/,+++ a month which cannot e inter%reted in any mannerthan a %ayment for the use of %remises which she had leased from the owners.

Mendio"a v CA ' Civ

1. MENDIOLA vs. CA(2006)

Facts:

Private respondent Pacific Forest Resources, Phils., Inc. (Pacfor) is a corporation

organized and existing under the laws of California, U!. It is a su"sidiar# of Cellulose

$ar%eting International (organized in weden).

Private respondent Pacfor entered into a &ide !gree'ent on Representative ffice

%nown as Pacific Forest Resources (Phils.), Inc.with petitioner !rsenio . $endiola (!$),

effective $a# *, *++, &assu'ing that Pacfor-Phils. is alread# approved "# the ecurities and

xchange Co''ission /C0 on the said date.he ide !gree'ent outlines the "usiness

relationship of the parties with regard to the Philippine operations of Pacfor. Private respondent

will esta"lish a Pacfor representative office in the Philippines, to "e %nown as Pacfor Phils, and

petitioner !$ will "e its President. Petitioner1s "ase salar# and the overhead expenditures of

the co'pan# shall "e "orne "# the representative office and funded "# Pacfor2!$, since Pacfor

Phils. is e3uall# owned on a 4-4 e3uit# "# !$ and Pacfor-U!.

In its application to the C, private respondent Pacfor proposed to esta"lish its

representative office in the Philippines with the purpose of 'onitoring and coordinating the

'ar%et activities for paper products. It also designated petitioner as its resident agent in the

Philippines, authorized to accept su''ons and processes in all legal proceedings, and all noticesaffecting the corporation.

he ide !gree'ent was a'ended through a &Revised perating and Profit haring

!gree'ent for the Representative ffice 5nown as Pacific Forest Resources (Philippines),6

where the salar# of petitioner was increased to 789,444 per annu'. :oth agree'ents show that

the operational expenses will "e "orne "# the representative office and funded "# all parties &as

e3ual partners,6 while the profits and co''issions will "e shared a'ong the'.

In ;ul# ice President for !sia of Pacfor, see%ing

confir'ation of his 4? e3uit# of Pacfor Phils. Private respondent Pacfor, through @illia'

Aleason, its President, replied that petitioner is not a part-owner of Pacfor Phils. "ecause the

latter is 'erel# Pacfor-U!1s representative office and not an entit# separate and distinct fro'

Pacfor-U!. &It1s si'pl# a Btheoretical co'pan#1 with the purpose of dividing the inco'e 4-


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4.6Petitioner presu'a"l# %new of this arrange'ent fro' the start, having "een the one to

propose to private respondent Pacfor the setting up of a representative office, and &not a "ranch

office6 in the Philippines to save on taxes.Petitioner clai'ed that he was all along 'ade to

"elieve that he was in a oint venture with the'. De alleged he would have "een "etter offre'aining as an independent agent or representative of Pacfor-U! as !$ $ar%eting Corp.Dad

he %nown that no oint venture existed, he would not have allowed Pacfor to ta%e the profita"le

"usiness of his own co'pan#, !$ $ar%eting Corp. Petitioner raised other issues, such as the

rentals of office furniture, salar# of the e'plo#ees, co'pan# car, as well as co''issions

allegedl# due hi'. he issues were not resolved, hence, in cto"er


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possi"l# steal and divert the sales and "usiness of private respondent for DPI1s principal,

International Forest Products, a co'petitor of private respondent .

Petitioner denied the charges. De reiterated that he considered the i'port of Pacfor

President @illia' Aleason1s letters as a &cessation of his position and of the existence of PacforPhils.6 De li%ewise infor'ed private respondent Pacfor that !$ $ar%eting Corp. now

occupies Pacfor Phils.1 office pre'ises, and de'anded pa#'ent of his separation pa#.

Petitioner filed his co'plaint for illegal dis'issal recover# of separation pa# and att#1s

fees with the ERC.

Private respondent directed petitioner to explain wh# he should not "e disciplined for

serious 'isconduct and conflict of interest. Private respondent charged petitioner anew with

serious 'isconduct for the latter1s alleged act of fraud and 'isrepresentation in authorizing the

release of an additional peso salar# for hi'self, "esides the dollar salar# agreed upon "# the

parties. Private respondent also accused petitioner of dislo#alt# and representation of conflicting

interests for having continued using the Pacfor Phils.1 office for operations of DPI.

Issues:

@hether an e'plo#er-e'plo#ee relationship exists "etween petitioner and private

respondent Pacfor.

Held:

There was an employer employee relationship but no partnership.

Petitioner argues that he is an industrial partner of the partnership he for'ed with private

respondent Pacfor, and also an e'plo#ee of the partnership. Petitioner insists that an industrial

partner 'a# at the sa'e ti'e "e an e'plo#ee of the partnership, provided there is such an

agree'ent, which, in this case, is the &ide !gree'ent6 and the &Revised perating and Profit

haring !gree'ent.6@e hold that petitioner is an e'plo#ee of private respondent Pacfor and that

no partnership or co-ownership exists "etween the parties.

Further'ore, in a partnership, 'e'"ers "eco'e co-owners (co-possessors) of what is

contri"uted to the fir' capital and of all the propert# that 'a# "e ac3uired there"#. ach partner

possesses a oint interest in whole partnership propert#.

If the relation does not have this feature, it is not one of partnership.

In this case, the parties 'erel# shared profits. his alone does not 'a%e a partnership.


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! corporation cannot "eco'e a 'e'"er of a partnership in the a"sence of express

authorization "# statute or charter. < reasonsG

(*) he 'utual agenc# "etween the partners, where"# the corporation would "e "ound "#

the acts of persons who are not its dul# appointed and authorized agents and officers, would "e

inconsistent with the polic# of the law that the corporation shall 'anage its own affairsseparatel# and exclusivel#H

(


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I!!$E)/O0 the case should be dismissed for it was not brought by the realparty in interest1

HEL#) 0O.

/hat the *ules of !ourt re;uire is that an action be brought in the name of,but not necessarily by, the real party in interest. '+ection , *ule .( &n fact thepractice is for an attorney-at-law to bring the action, that is to file thecomplaint, in the name of the plaintiff. That practice appears to have beenfollowed in this case, since the complaint is signed by the law firm of Aranetaand Araneta, "counsel for plaintiff" and commences with the statement "comesnow plaintiff, through its undersigned counsel." It is tr+e t't te (omp-'int'-so st'tes t't te p-'inti55 is represente& erein b its M'n'in

P'rtner Greorio "r'net', In(., 'noter (orpor'tion, b+t tere is notin''inst one (orpor'tion bein represente& b 'noter person, n't+r'- or

:+ri&i('-, in ' s+it in (o+rt. Te (ontention t't Greorio "r'net', In(.('nnot '(t 's m'n'in p'rtner 5or p-'inti55 on te teor t't it is i--e'-5or t;o (orpor'tions to enter into ' p'rtnersip is ;ito+t merit, 5or tetr+e r+-e is t't to+ ' (orpor'tion 's no po;er to enter into 'p'rtnersip, it m' neverte-ess enter into ' :oint vent+re ;it 'noter

;ere te n't+re o5 t't vent+re is in -ine ;it te b+siness '+tori


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8)


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The e(idence %re%onderates in fa(or of the (iew that the initial intention of the %arties was not toform a co+, as well as the documents showing the uncollected credits of theassociation, to Ares, et al in and to the rest of the memers of the said associationre%resented y said %laintiffs. !olistico et al contend that ecause ITurnuhan!olistico 4 7o.,I is unlawful, some charitale institution to whom the %artnershi%


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funds may e ordered to e turned o(er, should e included, as a %arty defendant.The a%%ellants refer to article * of the 7i(il 7ode, which %ro(ides) A %artnershi%must ha(e a lawful oject, and must e estalished for the common enefit of the%artners. When the dissolution of an unlawful %artnershi% is decreed, the %rofits shalle gi(en to charitale institutions of the domicile of the %artnershi%, or, in default of

such, to those of the %ro(ince.ssue)W-N the charitale institutions are considered as necessary %arties for the totaldis%osition of this caseL8eld)No. The %artnershi% is an unlawful %artnershi%. According to %aragra%h " of Art *of the 7i(il 7ode, when an unlawful %artnershi% is judicially dissol(ed, the earningsshall not e dis%osed of as %rofits, ut shall e gi(e to charitale institutions. But in acase like the one at ar, whose oject is to determine the rights of the %arties, and toliGuidate the unlawful %artnershi%, no charitale institution should e included asdefendant, as the a%%ellants content, ecause it is not a necessary %arty to the

case.Art. * of the 7i(il 7ode allows no action for the %ur%ose of otaining the earningsmade y the unlawful %artnershi%, during its e'istence, as a result of the usiness inwhich it was engaged$ ecause for that %ur%ose the %artner will ha(e to ase hisaction on the %artnershi% contract which is null and without legal e'istence yreason of its unlawful oject, and it is self=.8e also added that the re%airs made on the two cascoes were e'clusi(ely orne y


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him, and that he returned a sum of !*,*"# to %laintiff with an e'%ress reser(ation onhis %art of all his rights as a %artner.I$$e:aE W-N a %artnershi% e'isted etween the %arties. 5es.E W-N the %artnershi% was terminated when the defendant returned the !*,*"# to%laintiff. No.

He"d:aE The essential %oints u%on which the minds of the %arties must meet in acontract of %artnershi% are *E mutual contriution and "E joint interest in the %rofits.The fact that the defendant recei(ed money furnished y the %laintiff for the %ur%oseof using it to %urchase the cascoes estalishes the first element of the %artnershi%,mutual contriution to a common stock. Hor the second element, the fact that theformation of %artnershi% had een a suject of negotiation etween them, e(enefore the %urchase of the first casco, and that oth %arties intended to %urchase thecascoes in common satisfies the reGuirement that there should e an intention onthe %art of oth %arties to share the %rofits. With these, a com%lete and %erfectcontract of %artnershi% was entered into y the %arties.t must e noted howe(er that this %artnershi% was suject to a sus%ensi(e condition

which is the e'ecution of a written agreement regarding the distriution of %rofits,character of %artnershi%, etc. But since the defendant actually %urchased thecascoes, it would seem that the %artnershi% already e'isted. And as furthermore%ro(ided y the 7i(il 7ode, a written agreement was not necessary in order to gi(eefficacy to the (eral agreement of the %artnershi% ecause the contriutions of the%artners to the %artnershi% were not in the form of immo(ales.E 1uring trial, the court was ale to %ro(e that %laintiff actually furnished someamount for the re%air of the cascoes and that it was %resumed that a %rofit has eenotained y the defendant %rior to the return of the money. With these, the return ofthe !*,*"# fell short of the amount which the %laintiff has actually contriuted to the

%artnershi%. Hor these reasons, the acce%tance y the %laintiff of the amountreturned y the defendant did not ha(e the effect of terminating the legal e'istenceof the %artnershi% y con(erting it into a societas leonina.The court also %ro(ed that there was no intention on the %art of the %laintiff, inacce%ting the money, to relinGuish his rights as a %artner. 3n the contrary he notifieddefendant that he wai(ed none of his rights in the %artnershi%. Also the lack ofrecognition on the %art of the defendant of the %laintiff2s right in the %artnershi%%ro%erty and in the %rofits does not gi(e the former the right to force a dissolutionu%on the later u%on the terms which the %laintiff is unwilling to acce%t. A %artnershi%therefore e'isted etween the two and cascoes No. *#*# and "+>= are %artnershi%%ro%erties.

@ealuit ( Jaso F 7ary&.@. No. *?>?>" 6e%temer "*, "+**

J360HNA !. @0ABT, !etitioner,

(s.

!@360N73 1. JA63 and 010N &. JA63, @es%ondents.


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1 0 7 6 3 N

!0@0, J.)

Hacts)

Josefina @ealuit CJosefinaE entered into a Joint Venture Agreement with Hrancis0ric Amaury Biondo CBiondoE, for the o%eration of an ice manufacturing usiness.With Josefina as the industrial %artner and Biondo as the ca%italist %artner. Hor andin consideration of the sum of !#++,+++.++, howe(er, Biondo suseGuently

e'ecuted a 1eed of Assignment, transferring all his rights and interests in theusiness in fa(or of res%ondent 0den Jaso C0denE, the wife of res%ondent !rosencioJaso. The 6%ouses Jaso caused their lawyer to send Josefina a letter a%%rising herof their acGuisition of said Hrenchman2s share in the usiness and formallydemanding an accounting and in(entory thereof as well as the remittance of their%ortion of its %rofits.

Haulting Josefina with unjustified failure to heed their demand, the 6%ouses Jasocommenced the instant 7om%laint against Josefina and her husand, for s%ecific%erformance, accounting, e'amination, audit and in(entory of assets and %ro%erties,

dissolution of the joint (enture, a%%ointment of a recei(er and damages.

ssue)

W80T80@ T80 73@T MA5 3@10@ !0TT3N0@ SJ360HNA @0ABT A6!A@TN0@ N T80 J3NT V0NT@0 T3 @0N10@ SAN A773NTN& T3 3N0W83 6 N3T A !A@TN0@ N 6A1 J3NT V0NT@0.

8eld)

We find the %etition ereft of merit.


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&enerally understood to mean an organi:ation formed for some tem%orary %ur%ose,a joint (enture is likened to a %articular %artnershi% or one which Ihas for its ojectdeterminate things, their use or fruits, or a s%ecific undertaking, or the e'ercise of a%rofession or (ocation.I The rule is settled that joint (entures are go(erned y thelaw on %artnershi%s which are, in turn, ased on mutual agency or delectus

%ersonae. nsofar as a %artner2s con(eyance of the entirety of his interest in the%artnershi% is concerned, Article *>*/ of the 7i(il 7ode %ro(ides as follows)

Art. *>*/. A con(eyance y a %artner of his whole interest in the %artnershi% doesnot itself dissol(e the %artnershi%, or, as against the other %artners in the asence ofagreement, entitle the assignee, during the continuance of the %artnershi%, tointerfere in the management or administration of the %artnershi% usiness or affairs,or to reGuire any information or account of %artnershi% transactions, or to ins%ect the%artnershi% ooks$ ut it merely entitles the assignee to recei(e in accordance withhis contracts the %rofits to which the assigning %artners would otherwise e entitled.8owe(er, in case of fraud in the management of the %artnershi%, the assignee maya(ail himself of the usual remedies.

n the case of a dissolution of the %artnershi%, the assignee is entitled to recei(e hisassignor2s interest and may reGuire an account from the date only of the last accountagreed to y all the %artners.

Hrom the foregoing %ro(ision, it is e(ident that ICtEhe transfer y a %artner of his

%artnershi% interest does not make the assignee of such interest a %artner of thefirm, nor entitle the assignee to interfere in the management of the %artnershi%usiness or to recei(e anything e'ce%t the assignee2s %rofits. The assignment doesnot %ur%ort to transfer an interest in the %artnershi%, ut only a future contingent rightto a %ortion of the ultimate residue as the assignor may ecome entitled to recei(ey (irtue of his %ro%ortionate interest in the ca%ital.I 6ince a %artner2s interest in the%artnershi% includes his share in the %rofits, we find that the 7A committed nore(ersile error in ruling that the 6%ouses Jaso are entitled to Biondo2s share in the%rofits, des%ite Juanita2s lack of consent to the assignment of said Hrenchman2sinterest in the joint (enture. Although 0den did not, moreo(er, ecome a %artner as aconseGuence of the assignment and-or acGuire the right to reGuire an accounting ofthe %artnershi% usiness, the 7A correctly granted her %rayer for dissolution of the

joint (enture conformaly with the right granted to the %urchaser of a %artner2sinterest under Article *>/* of the 7i(il 7ode.


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!rimelink !ro%erties ( a:atin


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the ;a6atins without reim(ursement is un2ust= that the ;a6atins did not ask theproperties to (e placed under their possession (ut the# merel# asked for rescission.

SS>?: 3hether or not the impro%ements made (# Primelink should also (e turned

o%er under the possession of the ;a6atins.

4?;': @es. n the first place& e%en though the ;a6atins did specificall# pra# forpossession the same 0placing of impro%ements under their possession1 is incidental

in the relief the# pra#ed for. he# are therefore entitled possession o%er the parcelof land plus the impro%ements made thereon made (# Primelink.

n this 2urisdiction& 2oint %entures are go%erned (# the laws of partnership. >nderthe laws of partnership& when a partnership is dissol%ed& as in this case when the

trial court rescinded the 2oint %enture agreement& the innocent part# has the rightto wind up the partnership affairs.

3ith the rescission of the A" on account of petitioners fraudulent acts& allauthorit# of an# partner to act for the partnership is terminated except so far as

ma# (e necessar# to wind up the partnership affairs or to complete transactions(egun (ut not #et finished. n dissolution& the partnership is not terminated (ut

continues until the winding up of partnership affairs is completed. 3inding upmeans the administration of the assets of the partnership for the purpose of

terminating the (usiness and discharging the o(ligations of the partnership.

t must (e stressed& too& that although the ;a6atins acDuired possession of the

lands and the impro%ements thereon& the said lands and impro%ements remainedpartnership propert#& su(2ect to the rights and o(ligations of the parties& inter se& of

the creditors and of third parties and su(2ect to the outcome of the settlement ofthe accounts (etween the parties& a(sent an# agreement of the parties in their A"

to the contrar# 0here no agreement in the A" as to winding up1. >ntil thepartnership accounts are determined& it cannot (e ascertained how much an# of theparties is entitled to& if at all.

8eirs of Tan 0ng Uee ( 7A and Benguet umer 7oF !at

Hacts)

The com%laint alleged that after the second World War, Tan 0ng Uee and Tan 0ngay, %ooling their resources and industry together, entered into a %artnershi%engaged in the usiness of selling lumer and hardware and construction su%%lies.They named their enter%rise IBenguet umerI which they jointly managed until Tan


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0ng UeeKs death. !etitioners claimed that Tan 0ng ay and his children caused thecon(ersion of the %artnershi% IBenguet umerI into a cor%oration called IBenguetumer 7om%any.I !etitioners %rayed for accounting of the %artnershi% assets, andthe dissolution, winding u% and liGuidation thereof, and the eGual di(ision of the netassets of Benguet umer. The @T7 ruled in fa(or of %etitioners, declaring that

Benguet umer is a joint (enture which is akin to a %articular %artnershi%. The7ourt of A%%eals rendered the assailed decision re(ersing the judgment of the trialcourt.

ssue) Whether or not Tan 0ng Uee and Tan 0ng ay were %artners in Benguetumer.

8eld) N3.

The trial court determined that Tan 0ng Uee and Tan 0ng ay had entered into ajoint (enture, which it said is akin to a %articular %artnershi%. A %articular %artnershi%is distinguished from a joint ad(enture, to wit)

CaE A joint ad(enture Can American conce%t similar to our joint accountsE is a sort of

informal %artnershi%, with no firm name and no legal %ersonality. n a joint account,the %artici%ating merchants can transact usiness under their own name, and can eindi(idually liale therefor.

CE sually, ut not necessarily a joint ad(enture is limited to a 6N&0T@AN6A7T3N, although the usiness of %ursuing to a successful termination maycontinue for a numer of years$ a %artnershi% generally relates to a continuingusiness of (arious transactions of a certain kind. A joint (enture I%resu%%osesgenerally a %arity of standing etween the joint co


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e ack to sGuare one, so to s%eak, since they did not %resent and offer e(idencethat would show that Tan 0ng Uee recei(ed amounts of money allegedlyre%resenting his share in the %rofits of the enter%rise.

There eing no %artnershi%, it follows that there is no dissolution, winding u% orliGuidation to s%eak of.

8ence,the %etition must fail.

6e(illa ( 7A F Jen

DOCTRINE: A oin) ven)%e1 in&"din a ,a%)ne%$!i,1 ,%e$,,o$e$ene%a"" a o< $)andin /e)een )!e oin) &o-ven)%e%$ o% ,a%)ne%$1 in !i&!

ea&! ,a%) !a$ an e>a" ,%o,%ie)a% in)e%e$) in )!e &a,i)a" o% ,%o,e%)&on)%i/)ed and !e%e ea&! ,a%) e+e%&i$e$ e>a" %i!)$ in )!e &ond&) o< )!e/$ine$$.

NATURE: A%%eal y certiorari PONENTE:6armiento, J. #ACTS:

8. 3n the strength of a contract entered into y and etween Mrs. 6egundinaNoguera and the Tourist World 6er(ice, nc., re%resented y Mr. 0liseo7anilao, the Tourist World 6er(ice, nc. leased the %remises elonging toNoguera at Maini 6t., Manila for the former2s use as a ranch office. When theranch office was o%ened, the same was run y the herein a%%ellant ina

6e(illa.

". The Tourist World 6er(ice, nc. a%%ears to ha(e een informed thatina 6e(illa was connected with a ri(al firm, the !hili%%ine Tra(el Bureau, and,

since the ranch office was anyhow losing, the Tourist World 6er(iceconsidered closing down its office. This was firmed u% y two resolutions of the

oard of directors of Tourist World 6er(ice, nc. the first aolishing the office of themanager and (ice


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>, *=/, granted %ermitting her to %resent e(idence in su%%ort of her

counterclaim.

#. A%%ellant ina 6e(illa refiled her case against the herein a%%ellees and afterthe issues were joined, the reinstated counterclaim of 6egundina Noguera andthe new com%laint of a%%ellant ina 6e(illa were jointly heard following

which the court a Guo ordered oth cases dismiss for lack of merit

ISSUES: 6ON )!e%e a$ a ,a%)ne%$!i, /e)een To%i$) 6o%"d Se%vi&eand Lina Sevi""a

HELD: NO RATIO5RULING:

8. The 7ourt is asked to declare the true nature of the relation etween ina6e(illa and Tourist World 6er(ice, nc. The res%ondent 7ourt of see fit to ruleon the Guestion, the crucial issue, in its o%inion eing Iwhether or not the%adlocking of the %remises y the Tourist World 6er(ice, nc. without theknowledge and consent of the a%%ellant ina 6e(illa entitled the latter to therelief of damages %rayed for and !e)!e% o% no) )!e eviden&e


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the res%ondent 7ourt would later minimi:e her %artici%ation in the lease asone of mere guaranty, that does not make her an em%loyee of Tourist World,

since in any case, a true em%loyee cannot e made to %art with his own money in%ursuance of his em%loyerKs usiness, or otherwise, assume any liaility thereof.n that e(ent, the %arties must e ound y some other relation, ut certainly not

em%loyment.. n the second %lace, and as found y the A%%ellate 7ourt, KSwhen theranch office was o%ened, the same was run y the herein

a%%ellant ina 3. 6e(illa %ayale to Tourist World 6er(ice, nc. y any airline forany fare rought in on the effort of Mrs. ina 6e(illa. nder these circumstances,it cannot e said that 6e(illa was under the control of Tourist World 6er(ice,nc. Ias to the means used.I 6e(illa in %ursuing the usiness, o(iously reliedon her own gifts and ca%ailities.

. t is further admitted that Sevi""a a$ no) in )!e &om,anF$ ,a%o"". #o%!e% ea" ,%o,%ie)a% in)e%e$) in )!e&a,i)a" o% ,%o,e%) &on)%i/)ed and !e%e ea&! ,a%) e+e%&i$e$ e>a"

%i!)$ in )!e &ond&) o< )!e /$ine$$.

=. Hurthermore, )!e ,a%)ie$ did no) !o"d )!em$e"ve$ o) a$ ,a%)ne%$1 and)!e /i"din i)$e"< a$ em/e""i$!ed i)! )!e e"e&)%i& $in To%i$) 6o%"dSe%vi&e1 In&. in "ie o< a di$)in&) ,a%)ne%$!i, name.

83. t is the 7ourtKs considered o%inion, !en )!e ,e)i)ione%1 Lina Sevi""a1a%eed )o ?o@man )!e ,%iva)e %e$,onden)1 To%i$) 6o%"d Se%vi&e1 In&.F$E%mi)a o


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she recei(ed D of the %roceeds in the conce%t of commissions. And as wesaid, 6e(illa herself ased on her letter of No(emer ">, *=*, %re


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na'e with the plaintiff, and it appears that the said Eo-Chi'-Ei' personall# agreed to pa# for

the wor% hi'self. he plaintiff, however, has "rought this action against Eo-Chi'-Ei' and his

codefendants ointl#, alleging that, at the ti'e the contract was 'ade, the# were the joint

proprietors and operatorsof the said lu'"er #ard engaged in the purchase and sale of

lu'"er under the name and styleof Eo-Chi'-Ei'. !pparentl# the plaintiff tries to show "# the

words a"ove italicized that the other defendants were the partners of Eo-Chi'-Ei' in the said

lu'"er-#ard "usiness.

he court dis'issed the action on the ground that the# were not the partners of Eo-Chi'-

Ei', and rendered udg'ent against the other defendants.

Issue:

@hat is the real legal nature of the participation which the appellants had in Eo-Chi'-

Ei'1s lu'"er #ard and conse3uentl# their lia"ilit# toward the plaintiffL

Held:

The partnership is a partnership o cuentas en participation.

hose who contract with the person under whose na'e the "usiness of such partnership

of cuentas en participacion is conducted, shall have onl# a right of action against such person

and not against the other persons interested, and the latter, on the other hand, shall have no right

of action against the third person who contracted with the 'anager unless such 'anager for'all#

transfers his right to the'. (Article ! o" the Code o" Commerce.#It follows, therefore that the

plaintiff has no right to de'and fro' the appellants the pa#'ent of the a'ount clai'ed in the

co'plaint, as Eo-Chi'-Ei' was the onl# one who contracted with hi'.

Further'ore, it see's that the alleged partnership "etween Eo-Chi'-Ei' and the

appellants was for'ed "# ver"al agree'ent onl#. !t least there is no evidence tending to show

that the said agree'ent was reduced to writing, or that it was ever recorded in a pu"lic

instru'ent.

$oreover, that partnership had no corporate na'e. he plaintiff hi'self alleges in his

co'plaint that the partnership was engaged in "usiness under the na'e and st#le of Eo-Chi'-

Ei' onl#, which according to the evidence was the na'e of one of the defendants.

n the other hand, it does not appear that there was an# 'utual agree'ent, "etween theparties, and if there were an#, it has not "een shown what the agree'ent was. !s far as the

evidence shows it see's that the "usiness was conducted "# Eo-Chi'-Ei' in his own na'e,

although he gave to the appellants a share was has "een shown with certaint#.

$%he contracts made &ith the plainti"" &ere made 'y LoChimLim individually in his

o&n name) and there is no evidence that the partnership over contracted in any other "orm*.


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Under such circu'stances we find nothing upon which to consider this partnership other

than as a partnership of cuentas en participacion. It 'a# "e that, as a 'atter of fact, it is

so'ething different, "ut a si'ple "usiness and scant evidence introduced "# the partnership @e

see nothing, according to the evidence, "ut a si'ple "usiness conducted "# Eo-Chi'-Ei'

exclusivel#, in his own na'e, the na'es of other persons interested in the profits and losses of

the "usiness nowhere appearing.

! partnership constituted in such a 'anner, the existence of which was onl# %nown to

those who had an interest in the sa'e, "eing no 'utual agree'ents "etween the partners and

without a corporate na'e indicating to the pu"lic in so'e wa# that there were other people

"esides the one who ostensi"l# 'anaged and conducted the "usiness, is exactl# the accidental

partnership of cuentas en participaciondefined in article 239 of the Code of Commerce.

1ietrich ( Hreeman < Bianca

G.R. No. L-22 (ana% 21 8988

GEORGE O. DIETRICH1%laintiff


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t a%%ears from the record that Whitcom ne(er knew the %laintiff, ne(er hadanything to do with %ersonally, and that the %laintiffKs contract was withHreeman, the managing %artner of the laundry. t further a%%ears from therecord that !ierce, after he sold his interest in this laundry to Whitcom,continued to look after WhitcomKs interest y authority of the latter.

The %artnershi% entered into y Hreeman and Whitcom show clearly thatsuch %artnershi% was not a commercial one$ hence the %ro(isions of the 7i(il7ode and not the 7ode of 7ommerce must go(ern in determining the liailityof the %artners.

n 'ourns vs. Carman,the %artnershi% was one of cuentas en participacion. IA%artnershi%,I Guoting from the syllaus in this case, Iconstituted in such amanner that its e'istence was only known to those who had an interest in thesame, there eing no mutual agreement etween the %artners, and without acor%orate name indicating to the %ulic in some way that there were other%eo%le esides the one who ostensily managed and conducted the usiness,is e'actly the accidental %artnershi% of cuentas en participacion defined inarticle "/= of the 7ode of 7ommerce.I

n a %artnershi% of cuentas en participacion, under the %ro(isions of article

"D" of the 7ode of 7ommerce, those who contract with the %erson in whosename the usiness of such a %artnershi% was conducted shall ha(e only theright of action against such %erson and not against other %ersons interested.6o this case is easily distinguished from the case at ar, in that the one didnot ha(e the cor%orate name while the other was known as the Manila 6teamaundry.

The %laintiff was em%loyed y and %erformed ser(ices for the Manila 6teamaundry and was not em%loyed y nor did he %erform ser(ices for Hreeman

alone. The %ulic did not deal with Hreeman and Whitcom %ersonally, utwith the Manila 6team aundry. These two %artners were doing usinessunder this name and, as we ha(e said, it was not a commercial %artnershi%.Therefore, y the e'%ress %ro(isions of articles *=> and **/? of the 7i(il7ode the %artners are not liale indi(idually for the entire amount due the%laintiff. The liaility is %ro rata and in this case the a%%ellant is res%onsile tothe %laintiff for only one


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Hor these reasons the judgment of the court elow is re(ersed and judgmententered in fa(or of the %laintiff and against the defendant Whitcom for thesum of !/?, with interest as fi'ed y the court elow

Bi"anaa v Con$)an)ino ' Civ

. Bi+lan+a&a v. Constantino

Facts:

he case involves an appeal filed "# respondent-appellant Pastor :. Constantino with theCourt of First Instance of Rizal an a'ended co'plaint against petitioners Eucina :iglangawaand Eucia spiritu where the onl# issue, which is of law is the legalit# of the annotation of lispendenspredicated on his a'ended co'plaint.

=efendants Eucina :iglangawa and Eucia spiritu were or have "een the owners of aparcel of land in $arulas, Polo, :ulacan. :iglangawa, with the consent of her co-owner Euciaspiritu, appointed plaintiff their exclusive agent to develop the area descri"ed in paragraph ,+++.++and!",+++.++. it was also duly registered with the 607. 3n *=D> 6uter and 6%irig

got married and in effect 7arlson sold his share to the cou%le, the same was alsoregistered with the 607. The limited %artnershi% had een filing its income ta'returns as a cor%oration, without ojection y the herein %etitioner, 7ommissioner ofnternal @e(enue, until in *=#= when the latter, in an assessment, consolidated theincome of the firm and the indi(idual incomes of the %artners


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< Tan ( 1el @osario F Jen

DOCTRINE: ?$ee no)e$ /e"o@NATURE) 7onsolidated case. Two s%ecial ci(il actions for %rohiitionPONENTE) Vitug, J.#ACTS: This is a consolidated case in(ol(ing the constitutionality of @A ?D= or theSim,"i? 7onstitution. The %etitioner also stressed that it (iolates theeGual %rotection clause as it only im%osed ta'es u%on one who%ractice his %rofession alone and not to those who are engaged to single%ro%rietorshi%. In )!e 2nd &a$e1they argued that %e$,onden)$ !ave e+&eeded )!ei% %"e-makin a)!o%i) in a,,"in SNIT )o ene%a" ,%o


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o The court would ha(e a%%reciated the contention of the %etitioner if @A ?D= wasan inde%endent law. But since it is attached to a law that has already classifiedta'%ayers, there is no (iolation of eGual %rotection clause.2. A,,"i&a)ion o< SNIT )o ,a%)ne%$ in ene%a" ,%o


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rtega, then a senior partner in the law fir' :ito, $isa, and Eozada withdrew insaid fir'. De filed with C a petition for dissolution and li3uidation of partnership. C en"an c ruled that wit hdra wal of $is a fr o' the fi r' had disso lv ed th e partn ership.!ccordingl#, since it is partnership at will, the law fir' could "e dissolved "# an#par tner at an#ti'e, such as "# withdrawal therefro', regardless of good faith or "ad faith,

since no partner can "e forced to continue in the partnership against his will.

Issue:

*. @ the partnership of :ito, $isa O Eozada (now :ito, Eozada, rtega O Castillo)is apartnership at willH


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(s.AMB0@T3 T. 78A, res%ondent.

&3NA&A


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ssue)Whether there a %artnershi% was formed.

8eld)

We are not %ersuaded.

A %artnershi% may e constituted in any form, e'ce%t where immo(ale %ro%erty ofreal rights are contriuted thereto, in which case a %ulic instrument shall necessary.8ence, ased on the intention of the %arties, as gathered from the facts andascertained from their language and conduct, a (eral contract of %artnershi% may

arise. The essential %rofits that must e %ro(en to that a %artnershi% was agreedu%on are C*E mutual contriution to a common stock, and C"E a joint interest in the%rofits. nderstandaly so, in (iew of the asence of the written contract of%artnershi% etween res%ondent and Jacinto, res%ondent resorted to theintroduction of documentary and testimonial e(idence to %ro(e said %artnershi%. Thecrucial issue to settle then is to whether or not the I1ead ManKs 6tatuteI a%%lies tothis case so as to render inadmissile res%ondentKs testimony and that of hiswitness, Jose%hine.

Two reasons forestall the a%%lication of the I1ead ManKs 6tatuteI to this case.

Hirst, %etitioners filed a com%ulsory counterclaim against res%ondents in theiranswer efore the trial court, and with the filing of their counterclaim, %etitionersthemsel(es effecti(ely remo(ed this case from the amit of the I1ead ManKs6tatuteI. Well entrenched is the rule that when it is the e'ecutor or administrator orre%resentati(es of the estates that sets u% the counterclaim, the %laintiff, hereinres%ondent, may testify to occurrences efore the death of the deceased to defeatthe counterclaim. Moreo(er, as defendant in the counterclaim, res%ondent is notdisGualified from testifying as to matters of facts occurring efore the death of thedeceased, said action not ha(ing een rought against ut y the estate orre%resentati(es of the deceased.

6econd, the testimony of Jose%hine is not co(ered y the I1ead ManKs 6tatuteI forthe sim%le reason that she is not Ia %arty or assignor of a %arty to a case or %ersonsin whose ehalf a case is %rosecuted.I @ecords show that res%ondent offered thetestimony of Jose%hine to estalish the e'istence of the %artnershi% etween


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res%ondent and Jacinto. !etitionersK insistence that Jose%hine is the alter ego ofres%ondent does not make her an assignor ecause the term IassignorI of a %artymeans Iassignor of a cause of action which has arisen, and not the assignor of aright assigned efore any cause of action has arisen.I !lainly then, Jose%hine ismerely a witness of res%ondent, the latter eing the %arty %laintiff.

!etitionersK reliance alone on the I1ead ManKs 6tatuteI to defeat res%ondentKs claimcannot %re(ail o(er the factual findings of the trial court and the 7ourt of A%%ealsthat a %artnershi% was estalished etween res%ondent and Jacinto. Based not onlyon the testimonial e(idence, ut the documentary e(idence as well, the trial courtand the 7ourt of A%%eals considered the e(idence for res%ondent as sufficient to%ro(e the formation of %artnershi%, aleit an informal one.

n a des%erate id to cast dout on the (alidity of the oral %artnershi% etween

res%ondent and Jacinto, %etitioners maintain that said %artnershi% that had initialca%ital of !"++,+++.++ should ha(e een registered with the 6ecurities and0'change 7ommission C607E since registration is mandated y the 7i(il 7ode,True, Article *??" of the 7i(il 7ode reGuires that %artnershi%s with a ca%ital of!/,+++.++ or more must register with the 607, howe(er, this registrationreGuirement is not mandatory. Article *?> of the 7i(il 7ode e'%licitly %ro(ides thatthe %artnershi% retains its juridical %ersonality e(en if it fails to register. The failure toregister the contract of %artnershi% does not in(alidate the same as among the%artners, so long as the contract has the essential reGuisites, ecause the main%ur%ose of registration is to gi(e notice to third %arties, and it can e assumed thatthe memers themsel(es knew of the contents of their contract. n the case at ar,non,defendants-appellees.

'(ts)


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The complaint alleged that the plaintiff and defendant +everino >abato are partnersin a fishpond business 'pursuant to a public instrument - Annex "A"(. laintiff filedsaid complaint against defendant for the alleged failure and refusal of >abato torender accounts for the years 2F83 to 2F47.

>abato denied the existence of said partnership upon the ground that the contracttherefore had not been perfected, despite the execution of Annex "A", because Agadhad allegedly failed to give his 2,DDD contribution to the partnership capital.

T!- ?ismissed case for failure to state a cause of action. "nne? ", is n+-- 'n&voi&, p+rs+'nt to "rt. 1@@3 o5 o+r %ivi- %o&e, be('+se 'n inventor o5 te5ispon& re5erre& in s'i& instr+ment '& not been 'tt'(e& tereto.

I!!$E)/O0 Art 2337 is applicable in this case1

HEL#)0O

Articles 2332 and 2337 of said !ode provide5Art. 2332. A partnership may be constituted in any form, except whereimmovable property or real rights are contributed thereto, in which case apublic instrument shall be necessary.

Art. 2337. A contract of partnership is void, whenever immovable property iscontributed thereto, if inventory of said property is not made, signed by theparties< and attached to the public instrument.

The issue before us hinges on whether or not "immovable property or real rights"have been contributedto the partnership under consideration. &n Annex "A" thepartnership was established "to operate a fishpond", not to "engage in a fishpondbusiness". >oreover, none of the partners contributed either a fishpond or a realright to any fishpond. Their contributions were limited to the sum of 2,DDD each.&ndeed, aragraph E of Annex "A" provides5

That the capital of the said partnership is Two Thousand ',DDD.DD(esos hilippine !urrency, of which One Thousand '2,DDD.DD( pesos hasbeen contributed by +everino >abato and One Thousand '2,DDD.DD( esoshas been contributed by >auricio Agad.


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x x x x x x x x x

The operation of the fishpond mentioned in Annex "A" was the purpose of thepartnership. 0either said fishpond nor a real right thereto was contributed to the

partnership or became part of the capital thereof, even if a fishpond or a real rightthereto could become part of its assets.

/G*O*, we find that said Article 2337 of the !ivil !ode is not in point andthat, the order appealed from should be, as it is hereby set aside and the caseremanded to the lower court for further proceedings

3B&AT3N6 3H !A@TN0@6 AM3N& T80M60V06

RO(AS v MAGLANA#ACTS:Maglana and @ojas e'ecuted their articles of co


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HELD:*. There was no intention to dissol(e the first %artnershi% u%on the constitution ofthe second as e(erything else was the same e'ce%t for the fact that they took in anindustrial %artner) they %ursued the same %ur%oses, the ca%ital contriutions call forthe same amounts, all suseGuent renewals of Timer icense were secured in

fa(or of the first %artnershi%, all usinesses were carried out under the registeredarticles. To all intents and %ur%oses therefore, the Hirst Articles of !artnershi% wereonly amended, in the form of 6u%%lementary Articles of 7o

The %laintiff rought an action for the rescission of the %artnershi% contract etweenhimself and the defendant and the reimursement of his in(estment worth#+,+++%h% with interest at *" %er cent %er annum form 3ctoer *#, *="+, with costs,and any other just and eGuitale remedy against said defendant. The defendant


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denies generally and s%ecifically all the allegations of the com%laint and asked forthe dissolution of the %artnershi%, and the %ayment to him as its manager andadministrator !#++ monthly from 3ctoer *#, *="+ until the final dissolution withinterest.The 7H found that the defendant had not contriuted all the ca%ital he had ound

himself to in(est hence it demanded that the defendant liGuidate the %artnershi%,declared it dissol(ed on account of the e'%iration of the %eriod for which it wasconstituted, and ordered the defendant, as managing %artner, to %roceed withoutdelay to liGuidate it, sumitting to the court the result of the liGuidation together withthe accounts and (ouchers within the %eriod of thirty days from recei%t of notice ofsaid judgment. The %laintiff a%%ealed from said decision %raying for the rescission ofthe %artnershi% contract etween him and the defendant in accordance with Art.**"D.ssue)W-N %laintiff acGuired the right to demand rescission of the %artnershi% contractaccording to article **"D of the 7i(il 7ode.

8eld)The 67 ruled that owing to the defendant2s failure to %ay to the %artnershi% thewhole amount which he ound himself to %ay, he ecame indeted to the%artnershi% for the remainder, with interest and any damages occasioned therey,ut the %laintiff did not therey acGuire the right to demand rescission of the%artnershi% contract according to article **"D of the 7ode. Article **"D cannot ea%%lied to the case in Guestion, ecause it refers to the resolution of oligations ingeneral, whereas articles *>* and *>" s%ecifically refer to the contract of%artnershi% in %articular. And it is a well


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Hacts)

o 6eng and !ang im, 7hinese residents of the 7ity of Manila, were %artners,under the firm name of o 6eng and 7o., in the usiness of running a distillery,known as I0l !rogreso,I in the Munici%ality of !aomong, in the !ro(ince ofBulacan. The land on which said distillery is located as well as the uildings andim%ro(ements originally used in the usiness were the %ro%erty of another7hinaman, named o 5ao, who, leased the same to the firm of o 6eng and 7o. forthe term of three years.

%on the e'%iration of this lease a new written contract, the lease was e'tended forfifteen years. Neither the original contract of lease nor the agreement e'tending the

same was inscried in the %ro%erty registry, for the reason that the estate which isthe suject of the lease has ne(er at any time een so inscried.

!ang im sold all his interest in the distillery to his %artner o 6eng, thus %lacing thelatter in the %osition of sole owner$ o 6hui, again acting as attorney in fact of o5ao, e'ecuted and acknowledged efore a notary %ulic a deed %ur%orting tocon(ey to !ang im and another 7hinaman named Benito &al(e:, the entiredistillery %lant including the land used in connection therewith. As in case of thelease this document also was ne(er recorded in the registry of %ro%erty. Thereafter!ang im and Benito &al(e: demanded %ossession from o 6eng, ut the latter

refused to yield$ and the %resent action of unlawful detainer was thereu%on initiatedy !ang im and Benito &al(e:

8eld)

!laintiff !ang im has occu%ied a doule role in the transactions which ga(e rise tothis litigation, namely, first, as one of the lessees$ and secondly, as one of the%urchasers now seeking to terminate the lease. These two %ositions are essentiallyantagonistic and incom%atile. 0(ery com%etent %erson is y law ound to maintainin all good faith the integrity of his own oligations$ and no less certainly is he oundto res%ect the rights of any %erson whom he has %laced in his own shoes as regardsany contract %re(iously entered into y himself.

While yet a %artner in the firm of o 6eng and 7o., !ang im %artici%ated in thecreation of this lease, and when he sold out his interest in that firm to o 6eng this


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o%erated as a transfer to o 6eng of !ang imKs interest in the firm assets, includingthe lease$ and !ang im cannot now e %ermitted, in the guise of a %urchaser of theestate, to destroy an interest deri(ed from himself, and for which he has recei(ed full(alue.

The ad faith of the %laintiffs in seeking to de%ri(e the defendant of this lease isstrikingly re(ealed in the circumstance that %rior to the acGuisition of this %ro%erty!ang im had een %artner with o 6eng and Benito &al(e: an em%loyee. Boththerefore had een in relations of confidence with o 6eng and in that %osition hadacGuired knowledge of the %ossiilities of the %ro%erty and %ossily an e'%eriencewhich would ha(e enaled them, in case they had acGuired %ossession, to e'%loitthe distillery with %rofit. 3n account of his status as %artner in the firm of o 6engand 7o., !ang im knew that the original lease had een e'tended for fifteen years$and he knew the e'tent of (aluale im%ro(ements that had een made thereon.7ertainly, as oser(ed in the a%%ellantKs rief, it would e shocking to the moral

sense if the condition of the law were found to e such that !ang im, after %rofitingy the sale of his interest in a usiness, worthless without the lease, could inter(eneas %urchaser of the %ro%erty and confiscate for his own enefit the %ro%erty whichhe had sold for a (aluale consideration to o 6eng. The sense of justice recoilsefore the mere %ossiility of such e(entuality.

Ao(e all other %ersons in usiness relations, %artners are reGuired to e'hiittowards each other the highest degree of good faith. n fact the relation etween%artners is essentially fiduciary, each eing considered in law, as he is in fact, theconfidential agent of the other. t is therefore acce%ted as fundamental in eGuity

juris%rudence that one %artner cannot, to the detriment of another, a%%ly e'clusi(elyto his own enefit the results of the knowledge and information gained in thecharacter of %artner. Thus, it has een held that if one %artner otains in his ownname and for his own enefit the renewal of a lease on %ro%erty used y the firm, tocommence at a date suseGuent to the e'%iration of the firmKs lease, the %artnerotaining the renewal is held to e a constructi(e trustee of the firm as to suchlease. And this rule has e(en een a%%lied to a renewal taken in the name of one%artner after the dissolution of the firm and %ending its liGuidation.

Ta$on 4 San Ped%o v. Kamo%a 4 Son$ ?893@1on Tuason 4 1on 6an !edro entered into a mercantile %artnershi% en comanditawith Vi(es. t was named XYZuis Vi(es 4 7o. ater on, Vi(es died so the%artnershi% was dissol(ed and was reorgani:ed under the name XYZTuason 4 6an!edro.XY[ This %artnershi% was in the usiness of wood sawyers and uildingcontracts.E


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Tuason 4 6an !edro was only com%osed of the sur(i(ing %artners and this%artnershi% assumed the usiness of the old one.3ne day, 1on Tuason entered into a contract with a certain 1on Heliciano toconstruct 1on HelicianoKs house. n their contract, it was not mentioned that it wasmade on ehalf of the %artnershi%.

1on 6an !edro makes this %rotest Cwith res%ect to deli(ery of the houseE on ehalfof the firm, the manager of which is 1on Tuason. This action is to reco(er the %riceof the house.3jection was made on the right of the %artnershi% to sue ) w-n a %artnershi% canmaintain an action in its own ehalf u%on a contract entered into y one of the%artners in his own name.n the facts on record it was made to a%%ear that)o !artnershi% owns the credito !artnershi% was in %ossession of the document e(idencing the credito Atty a%%earing for the %artnershi% held a %ower of attorney from the %artnershi%,e'ecuted y Tuason as managing %artner

o 0(erything Tuason did was done y the !artnershi%o The action is solidary, therefore, the result is the same w-n it was rought y the%artnershi%. I!ayment should e made to the %erson in whose fa(or the oligation isconstituted, or to some other %erson authori:ed to recei(e it in his name.I CArt. **"of the 7i(il 7ode.ENote) !laintiff is the %artnershi%, defendants are the heirs of 1on Heliciano.I$$e5He"d:6hould %ayment e made to the %artnershi%L


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communicated to the %artnershi% which ecame res%onsile therefor. CArt. */D,7ode of 7ommerce.En (iew of the understanding and agreement etween Tuason and the %artnershi%,the res%onsiility of Tuason eing included in the res%onsiility of Tuason 4 6an!edro, the liaility of the firm is not less than the %ersonal liaility of the %artner, as

the %artnershi% was a general one.The action rought y the firm is sim%ly the action in fa(or of the %artner assumedy the firm.67 says the action rought y the %artnershi% will lie, and the %ayment which maye made to the %artnershi% u%on the circumstances stated will e %erfectly legal.The owner, 1on Heliciano, and, y his death, his heirs, are ound to %ay all the %riceagreed u%on to the contractor, ecause the house urned after the work terminated,and after the defendants had ecome in default with res%ect to their oligation torecei(e it,I for although it is e(ident that the contractor has done e(erythingincument u%on him for the deli(ery of the house, it is none the less true, as amatter of fact, that no such deli(ery took %lace. !etition denied.

Ca)a"an v Ga)&!a"ianF !at

HA7T6)7atalan and &atchalian are %artners. They mortgaged two lots to 1r. Mara(etogether with the im%ro(ements thereon to secure a credit from the latter. The%artnershi% failed to %ay the oligation. The %ro%erties were sold to 1r. Mara(e at a%ulic auction. 7atalan redeemed the %ro%erty and he contends that title should ecancelled and a new one must e issued in his name.660)1id 7atalan2s redem%tion of the %ro%erties make him the asolute owner of thelandsL801)No. nder Article *>+? of the N77 e(ery %artner ecomes a trustee for hisco%artner with regard to any enefits or %rofits deri(ed from his act as a %artner.7onseGuently, when 7atalan redeemed the %ro%erties in Guestion, he ecame atrustee and held the same in trust for his co%artner &atchalian, suject to his right todemand from the latter his contriution to the amount of redem%tion.

< im Tanhu ( @amolete F Jen

- Han"on v Ha$$e%mann and Beam ' Civ

-. anlon vs. aussermann and Beam

Facts:


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his action was originall# instituted "# R. . Danlon to co'pel the defendants, ;ohn @.Dausser'ann and !.@. :ea', to account for a share of the profits gained "# the' inreha"ilitating the plant of the :enguet Consolidated$ining Co'pan# and in particular to co'pelthe' to surrender to the plaintiff 4,444 shares of the stoc% of saidco'pan#, with dividendspaid thereon.It was initiall# agreed "# Danlon, Dausser'ann, :ea' and ellner thatP8,444.44 was neededto reha"ilitate the 'ineH P4,444.44 would co'e fro' Danlon "# securing and

o"tainingsu"scriptions for the co'pan#1s stoc%s, P$ 'n& BIL!ON >O$NG, petitioners, vs. THE N"TION"L L"OR

REL"TION! %OMMI!!ION, L"OR "RITER #"NIEL %. %$ETO,T"N#$"> #I!TILLER> IN%., ERN"N#O #$R"N, E#$"R#O P"LIB"N,RO$E E!TO%E "N# RO#RIGO !"NTO!,respondents.

'(ts)


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rivate respondents-employees ernando ?uran, duardo aliwan, *o;uestoce, and *odrigo +antos were employees of respondent corporationTanduay ?istillery, &nc, 'T?&( who were retrenched.

A complaint was filed by private respondents against T?& and petitioners #uand #oung "doing business under the name and style of Tanduay ?istillers".

)A - declared that the retrenchment is illegal thereby ordering respondentTanduay ?istillery, &nc., to reinstate the complainants to their former position

with bac=wages up to the time of change of ownership, if one has ta=en place.

0)*! H affirmed )A

A /rit of xecution be was against Tanduay ?istiller, &nc., /ilson #oung and9ames #u to immediately reinstate complainants ernando ?uran, *odrigo+antos, *o;ue stoce and duardo ?aliwan to their respective positions.

etitioners oppose a motion for execution on the ground that "the >otion forxecution is without any basis in so far as it prays for the issuance of a writ ofexecution against respondent Tanduay ?istillers, which is an entity separate

and distinct from respondent Tanduay ?istillery, &nc., and respondents 9ames#u and /ilson #oung."

ISSUE: W3N res%ondent N@7 committed gra(e ause of discretion inholding %etitioners 5u and 5oung lialeL

HELD: 506

The A2s decision does not in any manner oligate Tanduay 1istillers, or e(en%etitioners 5u and 5oung for that matter, to reinstate res%ondents. 3nly T1was held liale to reinstate res%ondents u% to the time of change ofownershi%, and for se%aration enefits.


63/63

A went eyond what was dis%osed y the decision and issued an orderwhich reGuired

. . . Tanduay 1istillers, nc., Wilson 5oung and James 5u to

immediately reinstate com%lainants Hernando 1uran, @odrigo 6antos,@oGue 0stoce and 0duardo 1aliwan to heir res%ecti(e %ositions.

The order of e'ecution and the writ of e'ecution ordering %etitioners andTanduay 1istillers to reinstate %ri(ate res%ondents em%loyees are, therefore,null and (oid.

W80@0H3@0, the %etition is herey &@ANT01, The Guestioned 3rder of the

aor Ariter 1aniel 7. 7ueto dated No(emer *?, *==" and the decision ofthe National aor @elations 7ommission u%holding said order are set asideas null and (oid.

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