ANTONIA TORRES, assisted by her husband, ANGELO TORRES; and EMETERIA BARING

versus
COURT OF APPEALS and MANUEL TORRES
[G.R. No. 134559
December 9, 1999]

By: KATHLEEN MADROÑO

Doctrine: Joint Venture Agreement as a partnership.

Facts:

Sisters Antonia and Emeteria instituted a civil case against Manuel. The sisters allegedly entered into a
joint venture agreement with Manuel for the development of a parcel of land into a subdivision.
Pursuant to said agreement, the sisters executed a Deed of Sale in favor of Manuel and the latter
registered the lot under his name. Manuel then mortgaged the lot to secure a loan from a bank which
proceeds were to be used for the development of the project as per agreement. However, the
subdivision did not push through. The CA held that the parties formed a partnership and thus they must
bear the loss in proportion to their share in the profit.

Issue:

Whether or not the parties formed a partnership.

Ruling:

Yes. There formed a partnership between the two on the basis of joint-venture agreement and deed of
sale. A reading of the terms of agreement shows the existence of partnership pursuant to Art 1767 of
Civil Code, which states “By the contract of partnership two or more persons bind themselves to
contribute money, property, or industry to a common fund, with the intention of dividing the profits
among themselves.” In the agreement, petitioners would contribute property to the partnership in the
form of land which was to be developed into a subdivision; while respondent would give, in addition to
his industry, the amount needed for general expenses and other costs. Furthermore, the income from
the said project would be divided according to the stipulated percentage. Clearly, the contract
manifested the intention of the parties to form a partnership.