DUTIES & OBLIGATIONS OF PARTNERS of Attachment/Levy upon Personalty served upon the record
custodian of the DOTC LTO of Mandaluyong City. A similar notice
Guy v. Gacott [G.R. No. 206147. January 13, 2016.]
FACTS:
March 3, 1997, Atty. Glenn Gacott (Gacott) from Palawan purchased
two (2) brand new transreceivers from Quantech Systems
Corporation (QSC) in Manila through its employee Rey Medestomas
(Medestomas
amounting to a total of P18,000.00. Due to major defects, Gacott
personally returned the transreceivers to QSC and requested that
they be replaced.
Time passed and Gacott did not receive the replacement units as
promised. QSC informed him that there were no available units and
that it could not refund the purchased price. Despite several
demands, both oral and written, Gacott was never given a
replacement or a refund. Thus, Gacott filed a complaint for damages.
Summons was served upon QSC and Medestomas, afterwhich they
filed their Answer, verified by Medestomas himself and a certain
Elton Ong (Ong). Decision was rendered in favor of Gacott.
Writ of execution was secured. During execution, Gacott learned that
QSC was not a corporation, but was in fact a general partnership
registered with the SEC. In the articles of partnership, Guy was
appointed as General Manager of QSC.
Upon learning that Guy had vehicles registered in his name, Gacott
instructed the sheriff to proceed with the attachment of one of the
motor vehicles of Guy based on the certification issued by the
DOTC-LTO. Sheriff Felizarte attached Guy's vehicle by virtue of the
Notice
was served to Guy through his housemaid at his residence.
He argued that he was neither impleaded as a defendant nor validly
served with summons and, thus, the trial court did not acquire
jurisdiction over his person; that under Article 1824 of the Civil Code,
the partners were only solidarily liable for the partnership liability
under exceptional circumstances; and that in order for a partner to be
liable for the debts of the partnership, it must be shown that all
partnership assets had first been exhausted.
ISSUE:
RULING:
DISSOLUTION, WINDING-UP AND TERMINATION OF
PARTNERSHIP
Muñasque v. C.A. [G.R. No. L-39780. November 11, 1985.]
Elmo Muñasque, in behalf of “Galan and Muñasque” partnership as
Contractor, entered into a written contract with Tropical Commercial
Co., through its branch manager Ramon Pons, for remodelling of
Tropical’s building in Cebu. The consideration for the entire services
is P25,000 to be paid: 30% upon signing of contract, and balance on
3 equal instalments of P6,000 every 15working days.
First payment of check worth P7,000 was payable to Muñasque, who
indorsed it to Galan for purposes of depositing the amount and
paying the materials already used. But since Galan allegedly
misappropriated P6,183.37 of the check for personal use, Muñasque
refused to indorse the second check worth P6,000. Galan then
informed Tropical of the “misunderstanding” between him and
Muñasque and this prompted Tropical to change the payee of the
second check from Muñasque to “Galan and Associates” (the duly
registered name of Galan and Muñasque partnership). Despite the
misappropriation, Muñasque alone was able to finish the project.
The two remaining checks were properly issued to Muñasque.
Muñasque filed a complaint for payment of sum of money plus
damages against Galan, Tropical and Pons for the amount covered
by the first and second checks. Cebu Southern Hardware Co and
Blue Diamond Glass Palace were allowed as intervenors having
legal interest claiming against Muñasue and Galan for materials
used.
TC:
- Muñasque and Pons jointly and severally liable to
intervenors
- Tropical and Pons absolved
CA affirmed with modification:
- Muñasque and Pons jointly liable to intervenors
Issue:
1. W/N Muñasque and Galan are partners?
2. W/N payment made by Tropical to Galan was “good
payment”?
3. W/N Galan should shoulder exclusively the amounts payable
to the intervenors (granting he misappropriated the amount
from the two checks)?
Held:
1. YES. Tropical had every right to presume the existence of
the partnership:
a. Contract states that agreement was entered into by
“Galan and Muñasque”
b. The first check issue in the name of Muñasque was
indorsed to Galan
The relationship was made to appear as a partnership.
2. YES. Muñasque and Galan were partners when the debts to
the intervenors were incurred, hence, they are also liable to
third persons who extended credit to their partnership.
There is a general presumption that each individual partner
is an authorized agent for the firm and that he has authority
to bind the firm in carrying on the partnership transactions.
The presumption is sufficient to permit third persons to hold
the firm liable on transactions entered into by one of the
members of the firm acting apparently in its behalf and within
the scope of his authority
3. NO. Article 1816 BUT construed together with Article 1824.
Art. 1816. “All partners, including industrial ones, shall be
liable pro rata x x x for the contracts which may be entered
into the name and for the account of the partnership, under
its signature and by a person authorized x x x”
Art. 1824. “All partners are liable solidarily with the
partnership for everything chargeable to the partnership
under Articles 1822 and 1823”
Art. 1822. “Where, by any wrongful act or omission of any
partner acting in the ordinary course of the business x x x or
with the authority of his co-partners, loss or injury is caused
to any person x x x”
Art. 1823. “The partnership is bound to make good the loss:
(1) Where one partner acting within the scope of his
apparent authority receives money or property of
a third person and misapplies it, and
 (2) Where the partnership in the course of its
business receives money or property of a third
person x x x is misapplied by any partner while it
is in the custody of the partnership.”
GR: In transactions entered into by the partnership, the
liability of the partners is merely joint
Exception: In transactions involving third persons falling
under Articles 1822 and 1823, such third person may hold
any partner solidarily liable for the whole obligation with the
partnership.
Reason for exception: the law protects him, who in good faith
relied upon the authority if a partner, whether real or
apparent.
However, as between Muñasque and Galan, justice also
dictates reimbursement in favour of Muñasque as Galan was
proven to be in bad faith in his dealings with his partner.
Tocao v. Court of Appeals [G.R. No. 127405 October 4, 2000]
FACTS:
Nenita A. Anay met petitioner William T. Belo, then the vice-president
for operations of Ultra Clean Water Purifier, through her former
employer in Bangkok. Belo introduced Anay to petitioner Marjorie
Tocao, who conveyed her desire to enter into a joint venture with her
for the importation and local distribution of kitchen cookwares. Belo
volunteered to finance the joint venture and assigned to Anay the job
of marketing the product.
Under the joint venture, Belo acted as capitalist, Tocao as president
and general manager, and Anay as head of the marketing
department and later, vice-president for sales.
The parties agreed that Belo’s name should not appear in any
documents relating to their transactions with West Bend Company.
Instead, they agreed to use Anay’s name in securing distributorship
of cookware from that company. The agreement was not reduced to
writing on the strength of Belo’s assurances that he was sincere,
dependable and honest when it came to financial commitments.
Anay having secured the distributorship of cookware products from
the West Bend Company and organized the administrative staff and
the sales force, the cookware business took off successfully. They
operated under the name of Geminesse Enterprise, a sole
proprietorship registered in Marjorie Tocao’s name. Belo made good
his monetary commitments to Anay.
Years later, Anay saved the business from losing profit by the time
she returned to the Philippines. On October 9, 1987, Anay learned
that Marjorie Tocao had signed a letter addressed to the Cubao
sales office to the effect that she was no longer the vice-president of
Geminesse Enterprise. Lina T. Cruz, marketing manager, that
Marjorie Tocao had barred her from holding office and conducting
demonstrations in both Makati and Cubao offices. Anay attempted to
contact Belo. She wrote him twice to demand her overriding
commission for the period of January 8, 1988 to February 5, 1988
and the audit of the company to determine her share in the net
profits.
The trial court held that there was indeed an "oral partnership
agreement between the plaintiff and the defendants. The trial court
finally held that a partner who is excluded wrongfully from a
partnership is an innocent partner. Hence, the guilty partner must
give him his due upon the dissolution of the partnership as well as
damages or share in the profits "realized from the appropriation of
the partnership business and goodwill." An innocent partner thus
possesses "pecuniary interest in every existing contract that was
incomplete and in the trade name of the co-partnership and assets at
the time he was wrongfully expelled." CA dismissed their appeal.
Hence, this petition.
ISSUE:
1. Whether or not there is an oral partnership formed
2. If so, was the exclusion of Anay resulted in the dissolution of
the partnership
RULING:
First Issue: Yes. To be considered a juridical personality, a
partnership must fulfill these requisites: (1) two or more persons bind
themselves to contribute money, property or industry to a common
fund; and (2) intention on the part of the partners to divide the profits
among themselves. may be constituted in any form; a public
instrument is necessary only where immovable property or real rights
are contributed thereto. This implies that since a contract of
partnership is consensual, an oral contract of partnership is as good
as a written one.
Private respondent contributed such expertise to the partnership and
hence, under the law, she was the industrial or managing partner. It
was through her reputation with the West Bend Company that the
partnership was able to open the business of distributorship of that
company’s cookware products; it was through the same efforts that
the business was propelled to financial success.
In a partnership, each partner must share in the profits and losses of
the venture, except that the industrial partner shall not be liable for
the losses. As an industrial partner, private respondent had the right
to demand for a formal accounting of the business and to receive her
share in the net profit.
Second Issue:
Petitioner’s instruction to Lina Torda Cruz, marketing manager, not to
allow private respondent to hold office in both the Makati and Cubao
sales offices concretely spoke of her perception that private
respondent was no longer necessary in the business operation and
resulted in a falling out between the two.
However, a mere falling out or misunderstanding between partners
does not convert the partnership into a sham organization. The
partnership exists until dissolved under the law. Since the
partnership
created by petitioners and private respondent has no fixed term and
is therefore a partnership at will predicated on their mutual desire
and consent, it may be dissolved by the will of a partner.
An unjustified dissolution by a partner can subject him to action for
damages because by the mutual agency that arises in a partnership,
the doctrine of delectus personae allows the partners to have the
power, although not necessarily the right to dissolve the partnership.
In this case, petitioner Tocao’s unilateral exclusion of private
respondent from the partnership is shown by her memo to the Cubao
office plainly stating that private respondent was no longer the vice-
president for sales of Geminesse Enterprise. By that memo,
petitioner Tocao effected her own withdrawal from the partnership
and considered herself as having ceased to be associated with the
partnership in the carrying on of the business. Nevertheless, the
partnership was not terminated thereby; it continues until the winding
up of the business. Petition denied.
Villareal v. Ramirez [G.R. No. 144214. July 14, 2003.]
FACTS:
Petitioners Luzviminda Villareal, Carmelito Jose and Jesus Jose
formed a partnership with a capital of P750,000 for the operation of a
restaurant and catering business under the name "Aquarius Food
House and Catering Services."
Jesus Jose withdrew from the partnership in January 1987 and his
capital contribution of P250,000 was refunded to him in cash by
agreement of the partners. In the same month, without prior
knowledge of respondents, petitioners closed down the restaurant,
allegedly because of increased rental. The restaurant furniture and
equipment were deposited in the respondents' house for storage.
Thereafter, respondent spouses wrote petitioners, saying that they
were no longer interested in continuing their partnership or in
reopening the restaurant, and that they were accepting the latter's
offer to return their capital contribution. Respondent Carmelita
Ramirez reiterated the request for the return of their one third share
in the equity of the partnership.
The trial court ruled that the parties had voluntarily entered into a
partnership, which could be dissolved at any time. Petitioners clearly
intended to dissolve it when they stopped operating the restaurant.
Hence, the trial court rendered judgment in favor of respondents and
against the petitioners ordering the latter to pay jointly and severally
respondents for actual damages in the amount of P250,000.00,
attorney's fees and the costs of suit."
On appeal, the Court of Appeals held that, although respondents had
no right to demand the return of their capital contribution, the
partnership was nonetheless dissolved when petitioners lost interest
in continuing the restaurant business with them.
ISSUE:
Whether or not by such dissolution petitioner is liable for the
respondent’s share in the partnership
RULING:
Petition is with merit.
Share in the partnership - They found that the dissolution took place
when respondents informed petitioners of the intention to discontinue
it because of the former's dissatisfaction with, and loss of trust in, the
latter's management of the partnership affairs. These findings were
amply supported by the evidence on record. Respondents
consequently demanded from petitioners the return of their one-third
equity in the partnership Since the capital was contributed to the
partnership, not to petitioners, it is the partnership that must refund
the equity of the retiring partners.
What must be returned - partnership must refund the shares of the
partners, the amount to be refunded is necessarily limited to its total
resources. In other words, it can only pay out what it has in its
coffers, which consists of all its assets. However, before the partners
can be paid their shares, the creditors of the partnership must first be
compensated. After all the creditors have been paid, whatever is left
of the partnership assets becomes available for the payment of the
partners' shares.
Evidently, in the present case, the exact amount of refund equivalent
to respondents' one-third share in the partnership cannot be
determined until all the partnership assets will have been liquidated
— in other words, sold and converted to cash — and all partnership
creditors, if any, paid. The CA's computation of the amount to be
refunded to respondents as their share was thus erroneous.