Magbojos, Kristine V.

TOPIC: Separate and Distinct Personality of Partnership

SALUDO, JR. v. PNB

GR 193138 | August 20, 2018
Jardeleza, J.

DOCTRINE: Unlike Philippine law, American law does not treat of partnerships as forming a
separate juridical personality for all purposes.

FACTS: Saludo Agpalo Fernandez and Aquino (SAFA) Law Office entered into a Contract of
Lease with PNB with a monthly rate of PHP189,600 for 3 years. This is subject to yearly
escalation rate of 10%. On August 1, 2001, the Lease Contract expired. SAFA Law Office
continued to occupy but failed to pay its monthly rental after December 2002. PNB sent demand
letters which later on, SAFA Law Office expressed its intention to negotiate. Subsequently,
SAFA Law Office vacated and PNB demanded for the payment of rental in arrears but they
failed to reach a settlement. On October 1, 2006, Saludo, in his capacity as managing partner of
SAFA Law Office, filed an amended complaint for accounting and/or recomputation of unpaid
rentals and damages against PNB. PNB later filed a motion to include SAFA Law Office, an
indispensable party as principal plaintiff in the complaint.

ISSUE: Is SAFA Law Office considered to have a separate and distinct juridical personality?

RULING: Yes. SAFA Law Office was constituted as a partnership at the time its partners signed
the Articles of Partnership (AOP) wherein they bound themselves to establish a partnership for
the practice of law, contribute capital and industry, and receive compensation and benefits. It
reveals the unequivocal intention of its signatories to form a partnership. Being a partnership, it
possesses a separate and distict juridical personality from its partners. Our law on partnership
does not exclude partnerships for the practice of law from its coverage. Art. 1767 of the Civil
Code provides that "two or more persons may also form a partnership for the exercise of a
profession." Art. 1783, on the other hand, states that "a particular partnership has for its object
determinate things, their use or fruits, or a specific undertaking, or the exercise of a profession
or vocation." Finally, we stress that unlike Philippine law, American law does not treat of
partnerships as forming a separate juridical personality for all purposes.