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Civil Law
Definition
1989 Bar Exam Question No. 9(2)

PARTNERSHIP
a. Yes, because there was an agreement
to contribute to a common fund.
b. Yes, because the intention of dividing
the profits between “X” & “Y” is clear in
Prof. Crisostomo A. Uribe their agreement.
c. No, as there was no partnership as the
agreement was not put into writing.
d. No, because “Y” gave the amount of

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P4,000 to “X” as “financial

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assistance”, thus a loan.

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Partnership
Distinguished from other Legal Relationships
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1988 Bar Exam Question No. 2(a)

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17%
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Distinguish co-ownership from partnership.

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Nature, Distinguished from,

a. It has juridical personality
Capacity, Kinds of Partnerships
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b. Created not only by agreement of the
Property Rights
50% parties but also by law
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c. Purpose is to make profits
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Dissolution
d. Profits are divided in accordance with
33%
their stipulation.
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Definition Essential Elements

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1989 Bar Exam Question No. 9(2) 1994 Bar Exam Question No. 5 (1)
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(2) “X” used his saving from his salaries amounting

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to a little more than P2,000 as capital in establishing 1) Can a husband and wife form a limited partnership
a restaurant. “Y” gave the amount of P4,000 to “X” to engage in real estate business, with the wife
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as “financial assistance” with the understanding that being a limited partner?

“Y” would be entitled to 22% of the annual profits
derived from the operation of the restaurant. After a. Yes, as long as they have a complete separation
the lapse of 22 years, “Y” filed a case demanding his of property regime.
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share in the said profits. “X” denied that there was

a partnership and raised the issue of prescription, as b. Yes, because they are prohibited to form a
universal partnership only.
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“Y” did not assert his rights anytime within ten (10)
years from the start of the operation of the c. No, because spouses are prohibited from
restaurant. entering into any kind of partnership.
Is “Y” a partner of “X” in the business? Why? d. No, because the wife cannot contribute either
money or property.

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Essential Elements Classification of Partnerships : As to Term

1994 Bar Exam Question No. 5 (2) 1993 Bar Exam Question No. 10

2) Can two corporations organize a general
partnership under the Civil Code of the Philippines?
a. Yes, as long as such power is stated in their
respective Articles of Incorporation.
b. Yes, this is included in the implied powers of a
corporation.
c. No, because the Civil Code expressly prohibits
corporations from entering into a contract of
partnership.
A, B and C formed a partnership for the purpose of
contracting with the Government in the construction
of one of its bridges. On June 30, 1992, after
completion of the project, the bridge was turned
over by the partners to the Government. On August
30, 1992, D, a supplier of materials used in the
project sued A for collection of the indebtedness to
him. A moved to dismiss the complaint against him
on the ground that it was the ABC partnership that
is liable for the debt. D replied that ABC partnership
was dissolved upon completion of the project for
which purpose the partnership was formed.

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d. No, because a corporation may not be bound by
persons who are neither directors nor officers of Will you dismiss the complaint against A if you were
the judge?

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the corporation.

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Essential Elements : Form

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Classification of Partnerships : As to Term
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2009 Bar Exam Question No. I(c)Part I 1993 Bar Exam Question No. 10
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a. Yes, because the partnership was for a

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particular undertaking and therefore was

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TRUE or FALSE. Answer TRUE if dissolved upon completion of the project for
which purpose the partnership was formed.
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the statement is true, or FALSE if the

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b. Yes, because the Partnership is the one
statement is false. liable for the materials used in the project.
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c. No, because A is solidarily liable with the
partnership for the materials used in the
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project.
(c) An oral partnership is valid. d. No, because A is subsidiarily liable as a
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general partner for his pro rata share.
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Essential Elements : Form

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Classification of Partners : According to their contribution

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2009 Bar Exam Question No. I(c)Part I 2001 Bar Exam Question No.XIII: (5%)
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a. True, is not covered by the Statute of

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Frauds.
b. True, the law does not require a Joe and Rudy formed a partnership to
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particular form of the contract for its operate a car repair shop in Quezon City.
validity. Joe provided the capital while Rudy
c. False, because if an immovable is contributed his labor and industry. On one
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contributed and there is no inventory, side of their shop, Joe opened and operated
the partnership is void.
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a coffee shop, while on the other side,

d. False, because if an immovable is Rudy put up a car accessories store.
contributed, the contract must be in a
public instrument.

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Classification of Partners : According to their contribution
2001 Bar Exam Question No.XIII: (5%)
May they engage in such separate businesses?
Why?
a. Yes, a partner can engage in any business even
without the consent of the other partners.
b. No, a partner cannot engage in any business
without the express consent of the other
partners.
c. Joe can operate the coffee shop even without
the consent of Rudy.
d. Rudy can put up a car accessories store even
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without the consent of Joe because it
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complements the business of the partnership.
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Property Rights : Interest in the Partnership
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1997 Bar Exam Question No.XVII
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Dielle, Karlo and Una are general partners
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in a merchandising firm. Having contributed
equal amounts to the capital, they also
agreed on equal distribution of whatever
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net profit is realized per fiscal period. After
two years of operation, however, Una
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conveys her whole interest in the
partnership to Justine, without the
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knowledge and consent of Dielle and Karlo.
Is the partnership dissolved? (2%)
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C
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Property Rights : Interest in the Partnership
C
1997 Bar Exam Question No.XVII
Is the partnership dissolved? (2%)
a. Yes, because Justine became a partner
of Dielle and Karlo.
b. Yes, because the assignment of Una’s
interest in the partnership to Justine is
void as it was without the knowledge
and consent of Dielle and Karlo.
c. No, because Justine did not become a
partner with the assignment.
d. No, because the assignment was
without the knowledge and consent of
Dielle and Karlo
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Property Rights : Interest in the Partnership
1997 Bar Exam Question No.XVII
Dielle, Karlo and Una are general partners in a
merchandising firm. Having contributed equal
amounts to the capital, they also agreed on equal
distribution of whatever net profit is realized per
fiscal period. After two years of operation, however,
Una conveys her whole interest in the partnership to
Justine, without the knowledge and consent of Dielle
and Karlo.
What are the rights of Justine, if any, should she
desire to participate in the management of the
partnership and in the distribution of a net profit of
P360,000.00 which was realized after her purchase
of Una’s interest? (3%)
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Property Rights : Interest in the Partnership
1997 Bar Exam Question No.XVII
a. Justine is entitled to participate in the
management of the partnership, however, she
will not have a share in the profits.
b. Justine is entitled to participate in the
management of the partnership and she is
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entitled to 1/3 share in the profits.
c. Justine is not entitled to participate in the
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management of the partnership, however, she
is entitled to 1/3 share in the profits.
d. Justine is not entitled to participate in the
management of the partnership. Neither is she
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entitled to a share in the profits.
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Property Rights :
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Right to Participate in the Management of the Business
1992 Bar Exam Question No. 12
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W, X, Y and Z organized a general partnership with
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W and X as industrial partners and Y and Z as
capitalist partners. Y contributed P50,000.00 and Z
contributed P20,000.00 to the common fund. By a
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unanimous vote of the partners, W and X were
appointed managing partners, without any
specification of their respective powers and duties.
A applied for the position of Secretary and B applied
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for the position of Accountant of the partnership.
The hiring of A was decided upon by W and X, but
was opposed by Y and Z.
C
The hiring of B was decided upon by W and Z, but
was opposed by X and Y.
Who of the applicants should be hired by the
partnership? Explain and give your reasons.
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Property Rights : Property Rights :

Right to Participate in the Management of the Business Right to Participate in the Management of the Business
1992 Bar Exam Question No. 12 1981 Bar Exam Question No. 14(1)

a. Neither A nor B, because in a joint management

by 2 or more partners, the unanimous consent
of all the partners is necessary for the act to 1. Could “A” alone, opposed by “B” and “C”, have
bind the partnership. “C” removed as manager? Explain.
b. A only because in a joint management by 2 or
more partners, an act of administration may
bind the partnership if it is a unanimous act of a. Yes, because a managing partner requires trust
the managing partners even if opposed by the and confidence of all partners.
other partners. b. Yes, because A has controlling interest in the
c. Neither A nor B, because the partner having partnership.
controlling interest opposed the appointments. c. No, because the removal of a partner named in
d. Both A and B because the opposing partners the Articles of Partnership requires the
unanimous consent of the partners.

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failed to outnumber the partners who made or
agreed to the appointments. d. No, because he can be removed only for a just
cause by partners having controlling interest.

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Property Rights of Partners Obligations of Partners among Themselves &
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Partner’s Right to Participate in the Management Remedies

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Kind of Management Scenario/ Extent of Power If opposed In case of tie Power to revoke Kind of Obligation to make good his promised contribution / Remedies
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1. 1Manager Appointed in the AOP Manager’s n/a With just cause Contribution Risk of Loss
Art. 1800 Appointed after the constitution decision plus partners 1. Money 1. amount promised 1. Specific Performance
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of the Partnership prevails. representing 2. interest – 12% unless 2. Dissolution

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May execute all acts of controlling 3. damages (Art. 1788) 3. Rescission? Art. 1838
administration despite interest.
opposition unless he should With or without 2. Property 1. ownership 1. Specific Performance
act in bad faith. cause plus - to deliver & transfer ownership 2. Dissolution
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partners - to warrant the thing
2. Solidary Without specification of their Majority of the Partners owning
representing - liable for the fruits
Management respective duties or without managing the
controlling Risk of Loss
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- 2 or more stipulation that one of them partners. controlling

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interest. - before delivery
Art. 1801 shall not act without the Interest.
consent of all others. - after delivery
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Each one may separately execute 2. use only

all acts of administration. -to deliver
3. Joint Management None of the partners shall act Not valid even if Not valid Risk of Loss – Art. 1795
Partner unless:
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- 2 or more without the consent of all due to
Art. 1802 others. absence or 1. fungible
disability 2. cannot be kept without deteriorating
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unless … 3. contributed to be sold

4. appraised in the inventory
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4. Partner’s as agents Management not agreed upon. Still binding n/a

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Art. 1803 Whatever anyone of them may do upon the 3. Industry - to render service 1. demand for value of
alone shall bind the partnership. service plus damages
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partnership. 2. specific performance?23
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Property Rights :
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Right to Participate in the Management of the Business Obligation of the Partners Among Themselves :
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1981 Bar Exam Question No. 14(1) Participate in the Losses

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“A”, “B” and “C” formed a partnership under the I. If there is an agreement as to losses:
following terms and conditions:
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a) Participation: “A” – 40%; “B” – 40%; “C” – a. In the agreement, all partners have a share in
20% the losses
b) “A” and “B” would supply the entire capital. “C” b. Agreement excluding a partner from losses
would contribute his management expertise and be
manager for the first five years without 1. capitalist
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compensation. 2. industrial
c) “C” shall not be liable for losses.
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The partnership became bankrupt.

II. If there is no agreement as to losses:
1. Could “A” alone, opposed by “B” and “C”, have a. but there is an agreement as to profits
“C” removed as manager? Explain. b. if no agreement as to profits and losses

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Obligation of the Partners Among Themselves Dissolution : Express will of Partners

1981 Bar Exam Question No. 14(2) 1995 Bar Exam Question No. 8
Pauline, Patricia and Priscilla formed a business
partnership for the purpose of engaging in neon
“A”, “B” and “C” formed a partnership under the advertising for a term of five (5) years. Pauline
following terms and conditions: subsequently assigned to Philip her interest in the
a) Participation: “A” – 40%; “B” – 40%; “C” – partnership. When Patricia and Priscilla learned of the
20% assignment, they decided to dissolve the partnership
b) “A” and “B” would supply the entire capital. “C” before the expiration of its term as they had an
would contribute his management expertise and be unproductive business relationship with Philip in the
manager for the first five years without past. On the other hand, unaware of the move of
compensation. Patricia and Priscilla but sensing their negative reaction
c) “C” shall not be liable for losses. to his acquisition of Pauline’s interest, Philip
simultaneously petitioned for the dissolution of the
The partnership became bankrupt. partnership.

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2. Could “C” be personally held liable for debts of 1. Is the dissolution done by Patricia and Priscilla without
the partnership not satisfied with the assets of the

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the consent of Pauline or Philip valid? Explain.
partnership. Amplify.

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Obligation of the Partners Among Themselves

1981 Bar Exam Question No. 14(2) 1995 Bar Exam Question No. 8
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the partnership not satisfied with the assets of the the consent of Pauline or Philip valid? Explain.
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partnership. Amplify.
a. Yes, because it was made by a majority of the
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partners.

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a. Yes, because the stipulation that “C” shall not
be liable for losses is void. b. Yes, because it was the express will of all the
partners who have not assigned their interests
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b. Yes, because all partners are liable pro-rata
contracts entered into by the partnership. c. No, because neither Pauline nor Philip consented to
the dissolution.
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c. No, because the stipulation that “C” shall not be

liable for losses is valid and binding among the d. No, the assignment was valid.
partners.
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d. No, industrial partners cannot be held liable to
partnership obligations.
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Partnership
Dissolution : Death
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Causes of Dissolution
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1997 Bar Exam Question No. 17(b) Extra-judicial (Art. 1830) Judicial
(Art. 1831)
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Voluntary (Pars. 1 & 2) Involuntary Voluntary

(Pars. 3-7)
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Without violation of the In contravention of the (a) supervening A. On application by or for a

Stating briefly the thesis to support your answer to agreement agreement illegality partner
each of the following cases, will the death – (1) insanity
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(a) termination of the definite
(b) of a partner terminate the partnership? term or particular
undertaking
(b) express will of any partner,
who must act in good
a. Yes, as long he is a limited partner. faith, when no definite
by the express will of any (b) loss of the specific thing (2) incapacity
partner at any time, - before the delivery (3) gross misconduct
where the - after delivery when only the use (4) willful or persistent breach
circumstances do not was contributed (5) The business of the
permit a dissolution
under any other
(c) death of any partner; partnership can only be
(d) insolvency of any partner or carried on at a loss;
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b. Yes, if the other partners have knowledge of term or particular

undertaking is specified
provision of this
article
of the partnership (6) Other circumstances render a
such event. (e) civil interdiction of any dissolution equitable.
(c) By the express will of all partner; B. On the application of the
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the partners who have not

c. No, because he may be substituted by another assigned their interests or
purchaser of a partner's
interest under article 1813
d. No, because death only dissolves a partnership suffered them to be or 1814:
charged for their separate (1) After the termination of the
debts specified term or
(d) expulsion of any partner - particular undertaking;
bona fide (2) At any time if the partnership
was a partnership at will
when the interest was
assigned or when the
27 charging order was30issued.

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