PARTNERSHIP CODAL AND CASE DIGESTSPage 2 of 16BY: MA. ANGELA LEONOR C. AGUINALDOATENEO LAW 2010
The essential elements of a partnership are thefollowing:1.
An agreement to contribute money, property,or industry to a common fund2.
Intent to divide the profits among thecontracting parties.The first element is admittedly present in this case.The petitioners have agreed to and did contributemoney and property to a common fund.On the second element, considering the facts andcircumstances of the case, it is shown that the purposewas to engage in real estate transactions for monetarygain and then divide the same among themselvesbecause:1.
They created the fund purposedly2.
They invested the same not only in onetransaction but in a series of transactions3.
The properties were not used for personalconsumption or residential use but wereleased separately to several persons4.
The properties were under the managementof one personAlthough, taken singly, they might not suffice toestablish the intent necessary to constitute apartnership, the collective effect of these circumstancesis such as to leave no room for doubt of the existenceof said intent in petitioners herein.*For purposes of the tax on corporations, our NIRCincludes these partnerships—with the exception only of general copartnerships—within the purview of the termcorporation. It thus clear clear to our mind thatpetitioners herein constitute a partnership, insofar asthe Code is concerned, and are subject to the incometax for corporations.
2 LAGUNA TRANSPORTATION CO. V. SSS107 PHIL 833
While it is true that a corporation once formed isconferred a juridical personality separate and distinctfrom the persons composing it, it is but of legal fictionintroduced for the purposes of convenience and tosubverve the ends of justice. The concept cannot beextended to a point beyond its reasons and policy, andwhen invoked in support of an end subversive of thispolicy, will be disregarded by the courts.
3 TUAZON V. BOLANOS95 PHIL 106
There is nothing against one corporation beingrepresented by another person, natural or juridical, in asuit in court.The contention that Gregorio Araneta Inc. cannot act asmanaging partner for plaintiff on the theory that it isillegal for two corporations to enter into a partnership iswithout merit, for the true rule is that though acorporation has no power into a partnership, it maynevertheless enter into a joint venture with anotherwhere the nature of that venture is in line with thebusiness authorized by its charter.
4 WOODHOUSE V. HALILI93 PHIL 526
A contract to form a partnership cannot be executed.It entails an obligation to do. The law recognizes theindividual’s freedom to do an act he has promised todo, or not to do it, as he pleases. This is a verypersonal act of which courts may not compelcompliance, as it is considered as an act of violence todo so.
5 EVANGELISTA V. ABAD SANTOS51 SCRA 416
It is not disputed that the prohibition against anindustrial partner engaging in business for himself seeks to prevent any conflict in interest between theindustrial partner and the partnership, and to insurefaithful compliance by said partner with his prestation.
6 MORAN V. CA133 SCRA 98
Partner who promises to contribute topartnership becomes promissory debtor of latter.2.
Essence of partnership is that partners sharein profits and losses.3.
Partner entitled to recover shares of profitsand losses realized by venture.4.
Where partnership venture is a failure, apartner is not entitled to any commissionpromised by co-partner where agreementdoesn’t state basis of commission.
7 THE LEYTE-SAMAR CO. V. CEA93 PHIL 100
A partner is not a creditor of the partnership.
8 COMMISSIONER OF INTERNAL REVENUEV. SUTER 27 SCRA 152
Where a company is not a universalpartnership—when the contributions of thepartners were fixed sums of money andneither one of them was an industrialpartner, it follows that it is not a partnershipwherein spouses are forbidden to enter. Norcould the subsequent marriage of thepartners operate to dissolve it, such marriagebeing one of the causes provided for thatpurpose.2.
The marriage of the partners doesn’t makethe company a sole proprietorship when thecapital contributions of the partners wereseparately owned and contributed by thembefore their marriage, and after they were joined in wedlock, such contributionsremained their respective separate property.
9 IN RE: PETITION FOR AUTHORITY, ETC.92 SCRA 1
It is tacitly provided for in the pertinent provisions of the Civil Code in Partnership that names in a firm nameof a partnership must either be those of living partnersand, in the case of non-partners, should be livingpersons who can subjected to liability. It is alsoprovided in the Code that a third person is precludedfrom including his name in the firm name under pain of assuming liability. The heirs of a deceased partner in alaw firm cannot be held liable as the old members of the creditor of a firm particularly where they are non-lawyers.
10 PALTING V. SAN JOSE PETROLEUM INC.18 SCRA 92411 CAMPOS RUEDA AND CO. V. PACIFICCOMMERCIAL