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AURELIO K. LITONJUA v. EDUARDO K. LITONJUA, GR NOS.

166299-300, 2005-12-13 Foremost of these are the following provisions of the Civil Code:
Facts: Art. 1771. A partnership may be constituted in any form, except where immovable property
Petitioner Aurelio K. Litonjua, Jr. (Aurelio) and herein respondent Eduardo K. Litonjua, Sr. or real rights are contributed thereto, in which case a public instrument shall be necessary.
(Eduardo) are brothers. The legal dispute between them started when, on December 4, 2002, Art. 1772. Every contract of partnership having a capital of three thousand pesos or more, in
in the Regional Trial Court (RTC) at Pasig City, Aurelio filed a suit against his brother money or property, shall appear in a public instrument, which must be recorded in the Office
Eduardo and herein respondent Robert T. Yang (Yang) and several corporations for specific of the Securities and Exchange Commission.
performance and accounting. In his complaint,[3] docketed as Civil Case No. 69235 and Failure to comply with the requirement of the preceding paragraph shall not affect the
eventually raffled to Branch 68 of the court,[4] Aurelio... alleged that, since June 1973, he liability of the partnership and the members thereof to third persons.
and Eduardo are into a joint venture/partnership arrangement in the Odeon Theater Art. 1773. A contract of partnership is void, whenever immovable property is contributed
business which had expanded thru investment in Cineplex, Inc., LCM Theatrical Enterprises, thereto, if an inventory of said property is not made, signed by the parties, and attached to
Odeon Realty Corporation (operator of Odeon I and II theatres), Avenue the public instrument.
Realty, Inc., owner of lands and buildings, among other corporations. Yang is described in the
complaint as petitioner's and Eduardo's partner in their Odeon Theater investment. AGUILA, JR. v. COURT OF APPEALS 316 SCRA 246(1999)
On December 20, 2002, Eduardo and the corporate respondents, as defendants a quo, filed a
joint ANSWER With Compulsory Counterclaim denying under oath the material allegations of Facts:
the complaint, more particularly that portion thereof depicting petitioner... and Eduardo as Alfredo N. Aguilar, Jr. (petitioner) is the manager of A.C.Aguila & Sons, Co., a partnership
having entered into a contract of partnership. As affirmative defenses, Eduardo, et al., apart engaged in lendingactivities. Felicidad S. Vda. de Abrogar (private respondent)and her late
from raising a jurisdictional matter, alleged that the complaint states no cause of action, husband, Ruben M. Abrogar, were the registeredowners of a house and lot, covered by
since no cause of action may be derived from the actionable... document, i.e., Annex "A-1", Transfer Certificate ofTitle No. 195101, in Marikina, Metro Manila. On April 18,1991, private
being void under the terms of Article 1767 in relation to Article 1773 of the Civil Code, infra. respondent, with the consent of her late husband,and A.C. Aguila & Sons, Co., represented
It is further alleged that whatever undertaking Eduardo agreed to do, if any, under by petitioner,entered into a Memorandum of Agreement which providedthat A.C. Aguila &
Annex "A-1", are unenforceable under the provisions of the Statute of Frauds. Sons, Co. shall buy the property
Earlier, Eduardo and the corporate defendants, on the contention that grave abuse of from private respondent for P200,000 subject to an option torepurchase for P230,000 (valid
discretion and injudicious haste attended the issuance of the trial court's aforementioned for 90 days), etc. On the sameday, the parties likewise executed a deed of absolute
Omnibus Orders dated March 5, and April 2, 2003, sought relief from the CA via similar... sale,dated June 11, 1991, wherein private respondent, with theconsent of her late husband,
recourse. Their petition for certiorari was docketed as CA G.R. SP No. 76987. sold the subject property to A.C.Aguila & Sons, Co., represented by petitioner,
Issues: forP200,000,00. In a special power of attorney dated the sameday, April 18, 1991, private
When it ruled that there was no partnership created by the actionable document because respondent authorized petitioner to cause the cancellation of TCT No. 195101 and the
this was not a public instrument and immovable properties were contributed to the issuanceof a new certificate of title in the name of A.C. Aguila andSons, Co., in the event she
partnership. failed to redeem the subject property as provided in the Memorandum of Agreement.Private
Ruling: respondent failed to redeem the property. Pursuant tothe special power of attorney
A partnership exists when two or more persons agree to place their money, effects, labor, mentioned above, petitionercaused the cancellation of TCT No. 195101 and the issuanceof a
and skill in lawful commerce or business, with the understanding that there shall be a new certificate of title in the name of A.C. Aguila andSons, Co. Private respondent then
proportionate sharing of the profits and losses between them.[20] A contract of... received a letter datedAugust 10, 1991 from Atty. Lamberto C. Nanquil, counsel forA.C.
partnership is defined by the Civil Code as one where two or more persons bound Aguila & Sons, Co., demanding that she vacate
themselves to contribute money, property, or industry to a common fund with the intention the premises within 15 days after receipt of the letter andsurrender its possession peacefully
of dividing the profits among themselves.[21] A joint venture, on the other hand, is... hardly to A.C. Aguila & Sons, Co.Otherwise, the latter would bring the appropriate action incourt.
distinguishable from, and may be likened to, a partnership since their elements are similar, Upon the refusal of private respondent to vacate thesubject premises, A.C. Aguila & Sons, Co.
i.e., community of interests in the business and sharing of profits and losses. Being a form of filed an ejectmentcase against her in the Metropolitan Trial Court, Branch 76,Marikina,
partnership, a joint venture is generally governed by the law on... partnership.[22] Metro Manila. MeTC, Marikina, MM (April 3,1992): Ruled in favor of A.C. Aguila & Sons, Co.
The underlying issue that necessarily comes to mind in this proceedings is whether or not Privaterespondent appealed to RTC Pasig, CA, and then SC but shestill lost. Private
petitioner and respondent Eduardo are partners in the theatre, shipping and realty business, respondent then filed a petition fordeclaration of nullity of a deed of sale filed by Felicidad
as one claims but which the other denies. And the issue bearing on the first assigned error... S.Vda. de Abrogar against Alfredo N. Aguila, Jr. She allegedthat the signature of her husband
relates to the question of what legal provision is applicable under the premises, petitioner on the deed of sale was aforgery because he was already dead when the deed wassupposed
seeking, as it were, to enforce the actionable document - Annex "A-1" - which he depicts in to have been executed on June 11,
his complaint to be the contract of partnership/joint venture between himself and 1991.•RTC,Marikina,MM(April11,1995):Dismissed. •CA(November29,1990):Reversed ruling
Eduardo. Clearly, then, a look at the legal provisions determinative of the existence, or of the RTC. Hence,this petition for review on certiorari.Petitioner now contends that: (1) he is
defining the formal requisites, of a partnership is indicated. not the real party ininterest but A.C. Aguila & Co., against which this case shouldhave been
Principles: brought; (2) the judgment in the ejectment case is a bar to the filing of the complaint for
declaration of nullity of adeed of sale in this case; and (3) the contract between A.C.Aguila & No. Respondents have no right to demand from petitioner the return of their equity share. As
Sons, Co. and private respondent is a found by the court petitioners did not personally hold its equity or assets. “The partnership
pacto de retro has a juridical personality separate and distinct from that of each of the partners.” Since the
sale and not an equitable mortgage as held by the appellatecourt. capital was contributed to the partnership, not to petitioners, it is the partnership that must
refund the equity of the retiring partners. However, before the partners can be paid their
Issue: shares, the creditors of the partnership must first be compensated. Therefore, the exact
Whether the real party in interest is A.C. Aguila & Co.and not petitioner. – amount of refund equivalent to respondents’ one-third share in the partnership cannot be
YES determined until all the partnership assets will have been liquidated and all partnership
creditors have been paid. CA’s computation of the amount to be refunded to respondents as
Ratio: their share was thus erroneous.
Under Art. 1768 of the Civil Code, a partnership "has
a juridical personality separate and distinct from that of each ofthe partners." The partners
cannot be held liable for theobligations of the partnership unless it is shown that the JOSEFINA P. REALUBIT vs. PROSENCIO D. JASO and EDENG JASO
legalfiction of a different juridical personality is being used forfraudulent, unfair, or illegal G.R. No. 178782 September 21, 2011
purposes. In this case, privaterespondent has not shown that A.C. Aguila & Sons, Co., as
aseparate juridical entity, is being used for fraudulent, unfair, orillegal purposes. Moreover, FACTS
the title to the subject property isin the name of A.C. Aguila & Sons, Co. and the Petitioner Josefina Realubit entered into a Joint Venture Agreement with Francis
Memorandumof Agreement was executed between private respondent, withthe consent of Eric Amaury Biondo, a French national, for the operation of an ice manufacturing
her late husband, and A.C. Aguila & Sons, Co.,represented by petitioner. Hence, it is the business. With Josefina as the industrial partner and Biondo as the capitalist partner, the
partnership, not itsofficers or agents, which should be impleaded in any litigationinvolving parties agreed that they would each receive 40% of the net profit, with the remaining 20% to
property registered in its name. A violation of this be used for the payment of the ice making machine which was purchased for the
business. For and in consideration of the sum of P500,000.00, however, Biondo subsequently
VILLAREAL V. RAMIREZ executed a Deed of Assignment transferring all his rights and interests in the business in favor
of respondent Eden Jaso, the wife of respondent Prosencio Jaso. With Biondo’s eventual
Facts: departure from the country, the Spouses Jaso caused their lawyer to send Josefina a letter
apprising her of their acquisition of said Frenchmans share in the business and formally
In 1984, Villareal, Carmelito Jose and Jesus Jose formed a partnership with a capital of demanding an accounting and inventory thereof as well as the remittance of their portion of
P750,000for the operation of a restaurant and catering business. Respondent Ramirez joined its profits.
as a partner in the business with the capital contribution of P250,000. In 1987, Jesus Jose
withdrew from the partnership and within the same time, Villareal and Carmelito Jose, Faulting Josefina with unjustified failure to heed their demand, the Spouses Jaso
petitioners closed the business without prior knowledge of respondents In March 1987, commenced the instant suit for specific performance, accounting, examination, audit and
respondents wrote a letter to petitioners stating that they were no longer interested in inventory of assets and properties, dissolution of the joint venture, appointment of a receiver
continuing the partnership and that they were accepting the latter’s offer to return their and damages. The said complaint alleged that the Spouses Realubit had no gainful
capital contribution. This was left unheeded by the petitioners, and by reason of which occupation or business prior to their joint venture with Biondo and that aside from
respondents filed a complaint in the RTC.RTC ruled that the parties had voluntarily entered appropriating for themselves the income of the business, they have fraudulently concealed
into a partnership, which could be dissolved at any time, and this dissolution was showed by the funds and assets thereof thru their relatives, associates or dummies. The Spouses
the fact that petitioners stopped operating the restaurant. On appeal, CA upheld RTC’s Realubit claimed that they have been engaged in the tube ice trading business under a single
decision that the partnership was dissolved and it added that respondents had no right to proprietorship even before their dealings with Biondo.
demand the return of their capital contribution. However since petitioners did not give the
proper accounting for the liquidation of the partnership, the CA took it upon itself to compute The RTC rendered its Decision discounting the existence of sufficient evidence from
their liabilities and the amount that is proper to the respondent. The computation of which which the income, assets and the supposed dissolution of the joint venture can be
was:(capital of the partnership – outstanding obligation) / remaining partners =amount due to adequately reckoned. Upon the finding, however, that the Spouses Jaso had been
private respondent nevertheless subrogated to Biondos rights in the business in view of their valid acquisition of
the latters share as capitalist partner. On appeal before the CA, the foregoing decision was
Issue: W/N petitioners are liable to respondents for the latter’s share in the partnership? set aside
upon the following findings that the Spouses Jaso validly acquired Biondos share in the
Ruling: business which had been transferred to and continued its operations and not dissolved as
claimed by the Spouses Realubit.
ISSUES
1. Whether there was a valid assignment or rights to the joint venture
2. Whether the joint venture is a contract of partnership
3. Whether Jaso acquired the title of being a partner based on the Deed of Assignment

RULING
1. Yes. As a public document, the Deed of Assignment Biondo executed in favor
of Eden not only enjoys a presumption of regularitybut is also considered prima
facie evidence of the facts therein stated. A party assailing the authenticity and due
execution of a notarized document is, consequently, required to present evidence that is
clear, convincing and more than merely preponderant. In view of the Spouses Realubits
failure to discharge this onus, we find that both the RTC and the CA correctly upheld the
authenticity and validity of said Deed of Assignment upon the combined strength of the
above-discussed disputable presumptions and the testimonies elicited from Eden and Notary
Public Rolando Diaz.

2. Yes. Generally understood to mean an organization formed for some temporary


purpose, a joint venture is likened to a particular partnership or one which has for its object
determinate things, their use or fruits, or a specific undertaking, or the exercise of a
profession or vocation. The rule is settled that joint ventures are governed by the law on
partnerships which are, in turn, based on mutual agency or delectus personae.

3. No. It is evident that the transfer by a partner of his partnership interest does not make
the assignee of such interest a partner of the firm, nor entitle the assignee to interfere in the
management of the partnership business or to receive anything except the assignees
profits. The assignment does not purport to transfer an interest in the partnership, but only a
future contingent right to a portion of the ultimate residue as the assignor may become
entitled to receive by virtue of his proportionate interest in the capital. Since a partner’s
interest in the partnership includes his share in the profits, we find that the CA committed no
reversible error in ruling that the Spouses Jaso are entitled to Biondos share in the profits,
despite Juanitas lack of consent to the assignment of said Frenchmans interest in the joint
venture. Although Eden did not, moreover, become a partner as a consequence of the
assignment and/or acquire the right to require an accounting of the partnership business, the
CA correctly granted her prayer for dissolution of the joint venture conformably with the
right granted to the purchaser of a partner’s interest under Article 1831 of the Civil Code.