FRANCISCO BASTIDA, PLAINTIFF AND APPELLEE,

VS. MENZI & CO., INC., J.M. MENZI AND P.C. SCHLOBOHM,
DEFENDANTS. MENZI & CO., INC., APPELLANT
G.R. No. 35840, March 31, 1933


FACTS:
Menzi & Co., Inc. (defendant corporation) was organized for the purpose of
importing and selling general merchandise, including fertilizer and fertilizer
ingredients.
The defendant corporation was divided into different departments, each
department headed by a manager who was to receive a fixed salary and
percentage of the profits.
On November 1921, Francisco Bastida (plaintiff) went to the manager of Menzi &
Co., Inc., J.M. Menzi, and offered to assign his contract with the Philippine Sugar
centrals Agency and to supervise the mixing of the fertilizer and to obtain other
orders for 50 % of the net profit that Menzi & Co., Inc., might derive therefrom.
The manager accepted the offer and this agreement was confirmed by the
defendant corporations letter to the plaintiff dated January 10, 1922.
Both parties entered into a written contract, which was the basis of the plaintiffs
present action.
It was stipulated that the business was to be carried on in the same manner as it
was prior to the said written contract, and that the plaintiff was to receive 35%
of the net profit.
The intervention of the plaintiff was limited to supervising the mixing of the
fertilizers in the bodegas of the defendant corporation.
Prior to the expiration of the contract, April 27, 1927, the manager of the
defendant corporation notified the plaintiff that the contract for his services
would not be renewed.
Consequently, after the expiration of said contract, the defendant corporation
proceeded to liquidation, which the plaintiff refused to agree with.
Plaintiff argued that the contract entered was a contract of general regular
commercial partnership, wherein the defendant corporation was the capitalist,
and the plaintiff was the industrial partner.


ISSUE:
Whether or not a partnership existed between Menzi & Co., Inc. and Francisco
Bastida?





HELD:
What existed between the two parties was not that of partners, but that of an
employer-employee.
The plaintiff was to receive as compensation for services rendered in supervising
the mixing of the fertilizers 35% of the net profits of the defendant corporation.
Nowhere in the contract was it stipulated that it was a contract of partnership.
The conduct of business of both parties was not that of partnership.
The contract was an agreement between the two parties, and that the plaintiff
would work for the defendant corporation, and he was to be compensated for
services rendered.
Art. 116 of the Code of Commerce does not apply to the case at bar.
It provides that articles of association by which two or more persons obligate
themselves to place in a common fund any property, industry, or any of these
things, in order to obtain profit, shall be commercial, no matter what it class may
be, provided it has been established in accordance with the provisions of the
Code.
There was no common fund involved in the case at bar.
The fertilizer business belonged exclusively to the defendant corporation and the
plaintiff was an employee of former, receiving compensation.
The phrase in the contract which says en sociedad con, which was the basis of
the plaintiffs argument that partnership existed, only means in association with
and not in partnership with.
Although the defendant corporation agreed to furnish the necessary financial aid
for the fertilizer business, it did not obligate itself to contribute any fixed sum as
capital.
The court ordered the defendant corporation to pay only what was owing to the
plaintiff as his salary or fixed share in the profits of the fertilizer business.