Liwanag v. Court of Appeals, G.R. No.

114398, October 24, 1997

Romero, J.

Facts: Liwanag asked Isidora Rosales to join her and Thelma Tagbilaran in the business of buying and
selling cigarettes. Under their agreement, Rosales would give the money needed to buy the cigarettes
while Liwanag and Tabligan would act as her agents, with a corresponding 40% commission to her if the
goods are sold; otherwise the money would be returned to Rosales. Rosales gave several cash advances
amounting to 633,650. Money was misappropriated. Rosales files a complaint of estafa against them.

Issue: 1. WON the parties entered into a partnership agreement; 2. if in the negative, WONthe
transaction is a simple loan

Held: 1. No. Even assuming that a contract of partnership was indeed entered into by and between the
parties, when money or property have been received by a partner for a specific purpose and he later
misappropriated it, such partner is guilty of estafa.2. No. In a contract of loan once the money is
received by the debtor, ownership over the same is transferred. Being the owner, the borrower can
dispose of it for whatever purpose he may deem proper