Manuel Aristotle R.

Bautista
18 years old
#36 Galang Compound, Brgy. San Roque,Antipolo City
09176680762

1. What are the seven (7) basic types of business organization? Define each.
 Sole proprietorship - a business that’s owned by just one person.
 Partnership - a two or more persons bind themselves to contribute money, property, or
industry to a common fund, with the intention of dividing profits among themselves
 Corporation - an artificial being created by operation of law, having the right of succession
and the powers, attributes and properties expressly authorized by law or incident to its
existence.
 Cooperative - an autonomous and duly registered association of persons, with a common
bond of interest, who have voluntarily joined together to achieve their social, economic, and
cultural needs and aspirations by making equitable contributions to the capital
required, patronizing their products and services and accepting a fair share of the risks and
benefits of the undertaking in accordance with universally accepted cooperative principles.
 Limited partnership - a form of partnership similar to a general partnership, except that in
addition to one or more general partners (GPs), there are one or more limited partners
 Limited liability Company (LLC) - a business structure that combines the pass-through
taxation of a partnership or sole proprietorship with the limited liability of a corporation.
 Non- profit organization (NPO) - an organization that uses surplus revenues to achieve its
goals rather than distributing them as profit or dividends

2. What is Partnership and what are the governing laws regarding Partnership?
Article1767. By the contract of partnership two or more persons bind themselves to contribute money,
property, or industry to a common fund, with the intention of dividing profits among themselves.

Unlike corporations whose governing law is a special law - the Corporation Code of the Philippines,
partnerships in the Philippines are governed by and covered under Articles 1767 to 1867 of the Civil
Code of the Philippines [circa 1950].  These are the provisions of law which govern all aspects of
partnerships - from their creation, formation, existence, operation and management to their dissolution
and liquidation, including the obligations of the partners to one another, to the public or third persons
and to the government.

3. What are the characteristic elements of Partnership?

(1) Consensual, because it is perfected by mere consent that is, upon the express or implied
agreement of two or more persons.

(2) Nominate, because it has a special name or designation in our law.

(3) Bilateral, because it is entered into by two or more persons and the rights and obligation arising
therefrom are always reciprocal.

(4) Onerous, because each of the parties aspires to procure for himself a benefit through the giving of
something.

(5) Commutative, because the undertaking of each the partner is considered as the equivalent of that
of the others.

(6) Principal, because it does not depend to its existence or validity upon some other contract.

(7) Preparatory, because it is entered into as a means to an end, i.e., to engage in business for the
realization of profits with the view of dividing them among the contracting parties.
4. What are the essential features of partnership?
(1) There must be a valid contract.
(2) The parties must have legal capacity to enter into the contract.
(3) There must be a mutual contribution of money, property, or industry to a common fund.
(4) The objective must be lawful.
(5) The purpose or primary purpose must be to obtain profit and to divide the same among the parties

5. Define profits and losses.

Art. 1797. The losses and profits shall be distributed in conformity with the agreement. If only the
share of each partner in the profits has been agreed upon, the share of each in the losses shall be in
the same proportion.
In the absence of stipulation, the share of each partner in the profits and losses shall be in proportion
to what he may have contributed, but the industrial partner shall not be liable for the losses. As for the
profits, the industrial partner shall receive such share as may be just and equitable under the
circumstances. If besides his services he has contributed capital, he shall also receive a share in the
profits in proportion to his capital. (1689a)

6. Give four (4) Rules in determining the existence of partnership.

i. Persons not partners as to each other. – Persons who are partners as between themselves
are partners as to third persons. Generally, the converse is true, to wit: if they are not partners
as between themselves, they cannot be partners as to third persons.
ii. Co-ownership or co-possession. – There is co-ownership (or co-possession) whenever the
ownership (or possession) of an undivided thing or right belongs to different persons. Co-
ownership of property does not of itself establish the existence of a partnership.
iii. Sharing of gross returns. – The mere sharing of gross returns alone does not indicate a
partnership, since in a partnership; the partners share profits after satisfying all of the
partnership’s liabilities. It is not merely the sharing of profits, but the sharing of them as a co-
owner of the business that makes one a partner.
iv. Receipt of share I the profits. – An agreement to share both profits and losses tends strongly
to establish the existence of a partnership, and conversely, the lack of such an agreement
tends strongly to disprove the existence of a partnership. But the mere fact of a right under
the contract to participate in both profits and losses of a business does not of itself have the
effect of establishing a partnership between those engaged therein.

7. Give seven (7) distinctions of partnership from co-ownership.

i. Creation. – Co-ownership is generally created by law. It may exist even without a contract but
partnership is always created by a contract (Art. 1767.), either express or implied;
ii. Juridical personality. – A partnership has a juridical personality separate and distinct from
that of each partner (Art. 1768.), while a co-ownership has none;
iii. Purpose. – The purpose of a partnership is the realization of profits (Art. 1767.), while in co-
ownership, it is the common enjoyment of a thing or right (Art. 486.);
iv. Duration. – Under the law, there is no limitation upon the duration of a partnership (Art. 1767,
1785.), while in co-ownership; an agreement to keep the thing undivided for more than ten
years is not allowed (Art. 494.);
v. Disposal of interests. – A partner may not dispose of his individual interest in the partnership
(Art. 1812.), so as to make the assignee a partner unless agreed upon by all of the partners
(Art. 1814.), while a co-owner may freely do so (Art. 495.);
vi. Power to act with third persons. – In the absence of any stipulation to the contrary (Art.
1803.), a partner may bind the partnership, while a co-owner cannot represent the co-
ownership (Art. 491, 492.); hence, a judgment secured against only one of the co-owners will
not bind the other co-owners; and
vii. Effect of Death. – The death of a partner results in the dissolution of the partnership (Art.
1830.), but the death of a co-owner does not necessarily dissolve the co-ownership.

8. Give eight (8) distinctions of partnership from conjugal partnership of gains.

 i. Parties. – A business partnership is created by the voluntary agreement of two or more
partners (Art. 1767.) belonging to either sex, while a conjugal partnership arises in case the
future spouses – a man and a woman – agree that shall govern their property relations during
marriage (Art. 105, Family Code.);
ii. Laws which govern. – The ordinary partnerships are, a rule, governed by the stipulation of the
parties (Arts. 1159, 1308.), whereas a conjugal partnership is governed by law (Arts. 105-133,
Family Code);
iii. Juridical personality. – A partnership has a personality under the law separate from the
members composing it, while conjugal partnership of gains has none;
iv. Commencement. – A partnership begins from the moment of the execution of the contract,
unless it is otherwise stipulated (Art. 1784.), while a conjugal partnership of gains commences
precisely on the date of the celebration of the marriage, and any stipulation to the contrary is
void (Arts. 88, 107, Ibid.);
v. Purpose. – The primary purpose of the ordinary partnership is to obtain profits (Art. 1767.),
while that of a conjugal partnership is to regulate the property relations of husband and wife
during the marriage (Art. 74, Ibid.);
vi. Distribution of profits. – In the ordinary partnership the profits are divided according to the
agreement of the partners or in proportion to their respective capital contributions (Art. 1797.),
while in a conjugal partnership, the shares of the spouses in the profits are divided equally
(Art. 106, Ibid);
vii. Management. – In the ordinary partnership, the management is shared equally by all the
partners unless one or more of them are appointed managers in the articles of partnership
(Arts. 1801-1803.), while in a conjugal partnership although the administration belongs to both
spouses jointly the husband’s decision shall prevail in case of disagreement (Art. 124, Ibid);
and
viii. Disposition of shares. – In the ordinary partnership, the whole interest of a partner may be
disposed of without the consent of the other partners (Art. 1813.), while in a conjugal
partnership, the share of each spouse cannot be disposed of during the marriage even with
the consent of the other. (Arts. 89, 107,121, 127, Ibid.)

9. Give four (4) distinctions of partnership from voluntary associations.

i. Juridical personality- A partnership has a juridical personality, while a voluntary association
has none;
ii. Purpose- A partnership is always organized for pecuniary profit, while in a voluntary
association , this objective is lacking:
iii. Contributions of members – In a partnership, there is a contribution of capital, either in the
form of money, property, or services, while in a voluntary association for social purposes,
although fess are usually collected from the members to maintain the organization, there is no
contribution of capital; and
iv. Liability of members – The partnership, as a rule, is the one liable in the first place for the
debts of the firm while in a voluntary association, the members are individually liable for the
debts of the association, authorized by them, either expressly or impliedly, or subsequently
ratified by them.
10. Define contract.

Art. 1305. A contract is a meeting of minds between two persons whereby one binds himself, with
respect to the other, to give something or to render some service.

11. Define personal/ movable property and real/immovable property.

IMMOVABLE PROPERTY
Art. 415. The following are immovable property:
(1) Land, buildings, roads and constructions of all kinds adhered to the soil;
(2) Trees, plants, and growing fruits, while they are attached to the land or form an integral
part of an immovable;
(3) Everything attached to an immovable in a fixed manner, in such a way that it cannot be
separated therefrom without breaking the material or deterioration of the object;
(4) Statues, reliefs, paintings or other objects for use or ornamentation, placed in buildings or
on lands by the owner of the immovable in such a manner that it reveals the intention to
attach them permanently to the tenements;
 (5) Machinery, receptacles, instruments or implements intended by the owner of the tenement
for an industry or works which may be carried on in a building or on a piece of land, and which
tend directly to meet the needs of the said industry or works;
(6) Animal houses, pigeon-houses, beehives, fish ponds or breeding places of similar nature,
in case their owner has placed them or preserves them with the intention to have them
permanently attached to the land, and forming a permanent part of it; the animals in these
places are included;
(7) Fertilizer actually used on a piece of land;
(8) Mines, quarries, and slag dumps, while the matter thereof forms part of the bed, and
waters either running or stagnant;
(9) Docks and structures which, though floating, are intended by their nature and object to
remain at a fixed place on a river, lake, or coast;
(10) Contracts for public works, and servitudes and other real rights over immovable
property. 
MOVABLE PROPERTY
Art. 416. The following things are deemed to be personal property:
(1) Those movables susceptible of appropriation which are not included in the preceding
article;
(2) Real property which by any special provision of law is considered as personal property;
(3) Forces of nature which are brought under control by science; and
(4) In general, all things which can be transported from place to place without impairment of
the real property to which they are fixed. (335a)
Art. 417. The following are also considered as personal property:
(1) Obligations and actions which have for their object movables or demandable sums; and
(2) Shares of stock of agricultural, commercial and industrial entities, although they may have
real estate. (336a)
Art. 418. Movable property is either consumable or nonconsumable. To the first class belong those
movables which cannot be used in a manner appropriate to their nature without their being consumed;
to the second class belong all the others. (337) 

12. What are the classifications of property in consideration of the following?

i. As to the extent of the subject matter
a. Universal Partnership – which refers to all the present property or to all profits
b. Particular partnership – a particular partnership has foe its object determinate things
their use or fruits or specific undertaking or exercise of a profession or vocation
ii. As to liability of the partners.
a. General Partnership – one consisting of general partners who are liable pro rata and
subsidiarily , sometimes solidarily with their separate property for partnership debts;
b. Limited Partnership-or one formed by two or more persons having as members one
or more general partners and one or more d partners the latter not being personally
liable for the obligations of the partnership.
iii. As to its duration
a. Partnership at will- or one in which no time is specified and is not formed for a
particular undertaking or venture and which may be terminated anytime by mutual
agreement of the partners or by the will of any one partner alone or one for a fixed
term or particular undertaking which is continue by the partners after the termination
of such term or particular undertaking without express agreement
b. Partnership with a fixed term- or one in which the term for the partnership is to exist is
fixed or agreed upon or one formed for a particular undertaking and upon the
expiration of the term or completion of the particular enterprise, the partnership is
dissolved , unless continue by the partners.
iv. As to legality of its existence
a. De Jure Partnership- or one which has complied with all the legal requirements for its
establishment
b. De Facto Partnership-or one which has failed to comply with all the legal
requirements for its establishment.
v. As to representation to others
a. Ordinary or real partnership-or one which actually exist among the partners and also
as to third persons;
 b. Ostensible partnership or partnership by estoppels- one which in reality is not a
partnership, but is considered a partnership only in relation to those who, by their
conduct or admission, are precluded to deny or disprove its existence
vi. As to publicity
a. Secret Partnership- one wherein the existence of certain persons as partners is not
avowed or made know to the public by the members of the firm,
b. Open or notorious partnership- one whose existence is avowed or made know to the
public by the members of the firm
13. What are the kinds of Partners?
i. Under the Civil Code
a. Capitalist partner – one who contributes money or property to common fund
b. Industrial partner – who contributes only his industry or personal service.
c. General partner – or one whose liability to third persons extends to his separate
property; he may either be capitalist or industrial partner.
d. Limited partner – or one whose liability to third persons is limited to his capital
contribution. He is also known as special partner. Unlike the general partner, he does
not participate in the management of business.
e. Managing partner – or one who manages the affair or business of the partnership; he
may be appointed either in the articles of partnership or after the constitution of the
partnership. He is also known as a general or real partner.
f. Liquidating partner – or one who takes charge of the winding up of partnership affairs
upon dissolution.
g. Partner by estoppels – or one who is not really a partner, not being a party to a
partnership agreement, but is liable as partner for the protection of innocent third
person. He is one who is represented as being, in fact, a partner, but who is not so as
between the partners themselves. He is also known as partner by implication or
nominal partner.
h. Sub partner – or one who, not being a member of the partnership, contracts with a
partner with reference to the latter’s share in the partnership.
ii. Other classifications
a. Ostensible partner – or one who takes active part and known to the public as a
partner in the business, whether or not he has an actual interest in the firm.
b. Secret partner – or one who takes active part in the business but is not known to be a
partner by outside parties nor held out as a partner by the other partners.
c. Silent partner – one who does not take any active part in the business although he
may be known to be a partner.
d. Dormant partner – one who does not take active part in the business and is not
known or held out as partner.
e. Incoming partner – or a person lately, or about to be, taken into a partnership as
member.
f. Retiring partner – or one withdrawn from the partnership; a withdrawing partner.

14. What is a Universal Partnership of all present property?

A universal partnership of all present property is one in which the partners contribute all the
properties which actually belong to each of them at a time of the constitution of the partnership to a
common fund, with the intention of dividing the same among themselves as well as the profits which
they may acquire therewith.

15. What is Universal Partnership of Profits?

A universal partnership of profits is one which comprises all that the partners may acquire by
their industry of work during the existence of the partnership and the usufruct of movable or
immovable property which each of the partners may possess at the time of the celebration of the
contract.

16. What is a Particular Partnership?

A particular partnership has for its object determinate things, their use of fruits, or a specific
undertaking, or the exercise of a profession or vocation. It is a partnership which is neither universal
partnership of present property nor a universal partnership of profits.

17. What are the Relations created by the Contract of Partnership?

 A contract of partnership gives rise to at last four distinct juridical relations, namely:

(1) Relations among the partners themselves;

(2) Relations of the partners with the partnership;
(3) Relations of the partnership with third persons with whom it contracts; and
(4) Relations of the partners with such third persons.

18. What are the Obligations of a partner with respect to the contribution of property?

(1) To contribute at the beginning of the partnership or at the stipulated time the money,
property, or industry which he may have promised to contribute;
(2) To answer for eviction in case the partnership is deprived of the determinate property
contributed; and
(3) To answer to the partnership for the fruits of the property the contribution of which he
delayed, from the date they should have been contributed up to the time of actual delivery.
In addition, the partner has the obligation:
(4) To preserve said property with the diligence of a good father of a family pending delivery
to the partnership (Art. 1163.); and
(5) To indemnify the partnership for any damage caused to it by the retention of the same or
by the delay in its contribution (Arts. 1788, 1170.)

ESSAY

1. Describe yourself and what do you want to be ten years from now?

I would describe myself as a self-confident guy with a predetermined goal to fulfill my objective. 
I believe in hardwork and sincerity which should be backed by good character and discipline
which are necessary for anyone to reach his/her goals.  I’m an optimist rather than a pessimist –
but I’m also a realist. Above all, I would say I’m a positive and enthusiastic person.

Ten years from now I see myself as a certified public accountant or having a job from a company
that provide me with interesting and challenging work.