Art. 1802.

Stipulation requiring unanimity of action

Gen. Rule: Unanimous consent of all the managing partners (even if one is absent/incapacitated) shall be necessary for the validity
of the acts and the absence/disability of any managing partner cannot be alleged

Exception: when there is an imminent danger of grave/irreparable injury to the partnership

This rule is not applicable to a third person who contracts with the partnership because he has the right to presume that the partner
with whom he contracts has the consent if his copartner.

Art. 1803. Rules for the Manner of Management if not agrees upon

1. All partners are considered managers and they can do all acts of administration, but if opposed by other partners, majority
shall prevail. If tie, vote of partners representing the controlling interest
2. No partners may make important alterations in immovable property of the partnership without the consent of others, even
if it may be useful to the partnership.

Consent may be express/ implied (partners have knowledge about the alteration & they did not oppose)

If refusal of others is manifestly prejudicial to the interest of the partnership, court’s intervention may be sought.

Art. 1804. Every partner may have an associate in his share, but the associate may not be admitted to the partnership without
consent of other partners.

Reason for the consent:

1. Mutual trust -basis of partnership

2. Change in Partnership -modification/novation of the contract

Art. 1805. Partnership books: (1) should be kept at the principal place of business of the partnership, (2) should be accessible to
every partner at any reasonable hour and may inspect & copy any of them

Partnership Books -example of partnership property, co-owned by every partner

Reasonable Hour -on business days throughout the year, not merely during some arbitrary period of a few days chosen by the
directors/managers (acc. to Supreme Court)

Purpose: for the partner to obtain true and full information of all things affecting the partnership.

Art. 1806. Who can demand true & full information of the things affecting the partnership:

1. Any partner
2. Legal representative of any deceased partner
3. Legal representative of any partner under legal disability

Concealment -violation of this article

Art. 1807. Profits derived by a partner without the consent of other partners

Every partner must:

1. Account to the partnership for any benefit

2. Hold as trustee for any profits he derived without the consent of other partners from any transaction connected with
formation, conduct, or liquidation of the partnership/from any of use by him of its property

Rationale: partners are governed by fiduciary relationship -mutual trust & confidence
Art. 1808. Capitalist Partner cannot engage in any kind of business that the partnership is already engaged in, unless otherwise
stipulated. In case of violation, he shall:

1. bring to the common funds any profits accruing to him from his transactions
2. personally bear losses

Rationale: capitalist partner already has an acquired knowledge of the secrets of the partnership so it would be unfair to engage in a
business similar to the partnership.

Art. 1809. Formal accounting is not demandable until after the partnership dissolution; Exceptions:

1. A partner is wrongfully excluded from the partnership business/possession of its property by co-partners
2. If the right to demand for accounting exist under the terms of any agreement
3. As provided in Art. 1807 (every partner must account to the partnership derived by him without the consent of other
partners)
4. Other circumstances that render it just & reasonable

Formal Account – necessary incident to the dissolution of the partnership