Agad vs.

Mabato (1968)
MAURICIO AGAD, plaintiff-appellant, vs. SEVERINO MABATO and MABATO and AGAD
COMPANY, defendants-appellees.
Articles 1771 and 1773 of said Code provide:
Art. 1771. A partnership may be constituted in any form, except where immovable property or
real rights are contributed thereto, in which case a public instrument shall be necessary.
Art. 1773. A contract of partnership is void, whenever immovable property is contributed
thereto, if inventory of said property is not made, signed by the parties; and attached to the
public instrument.
FACTS:
Alleging that he and defendant Severino Mabato are — pursuant to a public instrument dated
August 29, 1952, copy of which is attached to the complaint as Annex “A” — partners in a
fishpond business, to the capital of which Agad contributed P1,000, with the right to receive
50% of the profits; that from 1952 up to and including 1956, Mabato who handled the
partnership funds, had yearly rendered accounts of the operations of the partnership; and that,
despite repeated demands, Mabato had failed and refused to render accounts for the years 1957
to 1963, Agad prayed in his complaint against Mabato and Mabato & Agad Company, filed on
June 9, 1964, that judgment be rendered sentencing Mabato to pay him (Agad) the sum of
P14,000, as his share in the profits of the partnership for the period from 1957 to 1963, in
addition to P1,000 as attorney’s fees, and ordering the dissolution of the partnership, as well as
the winding up of its affairs by a receiver to be appointed therefor.
In his answer, Mabato admitted the formal allegations of the complaint and denied the existence
of said partnership, upon the ground that the contract therefor had not been perfected.
ISSUE: Whether or not “immovable property or real rights” have been contributed to the
partnership under consideration.
RULING:
Mabato alleged and the lower court held that the answer should be in the affirmative, because
“it is really inconceivable how a partnership engaged in the fishpond business could exist
without said fishpond property (being) contributed to the partnership.” It should be noted,
however, that, as stated in Annex “A” the partnership was established “to operate a fishpond”,
not to “engage in a fishpond business”.
Moreover, none of the partners contributed either a fishpond or a real right to any fishpond.
Their contributions were limited to the sum of P1,000 each.
Articles 1771 and 1773 of said Code provide:
Art. 1771. A partnership may be constituted in any form, except where immovable property or
real rights are contributed thereto, in which case a public instrument shall be necessary.
Art. 1773. A contract of partnership is void, whenever immovable property is contributed
thereto, if inventory of said property is not made, signed by the parties; and attached to the
public instrument.
The operation of the fishpond mentioned in Annex “A” was the purpose of the partnership.
Neither said fishpond nor a real right thereto was contributed to the partnership or became part
of the capital thereof, even if a fishpond or a real right thereto could become part of its assets.
WHEREFORE, we find that said Article 1773 of the Civil Code is not in point and that, the
order appealed from should be, as it is hereby set aside and the case remanded to the lower
court for further proceedings, with the costs of this instance against defendant-appellee,
Severino Mabato. It is so ordered.
 Krivenko v Register of Deeds, 44 OG 471November 15, 1947
Facts:
Alenxander A. Kriventor alien, bought a residential lot from the Magdalena Estate, Inc.,in
December 1941. The registration however, was interrupted by the war. In May, 1945, hesought
to accomplish said registration. The register of deeds of Manila denied registration onthe
ground that, being an alien, he cannot acquire land in this jurisdiction. Krivenko thenbrought
the case (to the fourth branch of the Court of First Instance of Manila) by means of a consulta,
and that court rendered judgment sustaining the refusal of the register of deeds,from which
Krivenko appealed to this Court.

Issue:
May an alien acquire private lands from Filipino citizens?
Held:
No. It would certainly be futile to prohibit the alienation of public agricultural lands
toaliens if, after all, they may be freely so alienated upon their becoming private
agriculturallands in the hands of Filipino citizens. Lands and natural resources are immovables
and assuch can be compared to the vital organs of a person's body, the lack of possession of
whichmay cause instant death or the shortening of life.Prior to the Constitution, under Public
Land Act No. 2874, aliens could acquire publicagricultural lands used for industrial or
residential purposes, and lands of the public domainsuitable for residence or industrial purposes
could be sold or leased to aliens. But, after theConstitution and under Commonwealth Act No.
141, the right of aliens to acquire such kind oflands is completely stricken out, and that such
land may only be leased, but not sold, toaliens, and the lease granted shall only be valid while
the land is used for the purposes referredto.Under section 1 of Article XIII of the Constitution,
"natural resources, with theexception of public agricultural land, shall not be aliented," their
alienation is limited toFilipino citizens. section 5 is included in Article XIII, and it reads as
follows:Sec. 5. Save in cases of hereditary succession, no private agricultural land will
betransferred or assigned except to individuals, corporations, or associations qualified to
acquireor hold lands of the public domain in the Philippines.We are deciding the instant case
under section 5 of Article XIII of the Constitutionwhich is more comprehensive and more
absolute in the sense that it prohibits the transfer toalien of any private agricultural land
including residential land whatever its origin might havebeen. However, aliens are not
completely excluded by the Constitution from the use of lands forresidential purposes. Since
their residence in the Philippines is temporary, they may begranted temporary rights such as a
lease contract which is not forbidden by the Constitution.Should they desire to remain here
forever and share our fortunes and misfortunes, Filipinocitizenship is not impossible to acquire.
 FIRESTONE TIRE AND RUBBER COMPANY OF THE
PHILIPPINES, Petitioner, v. CARLOS LARIOSA and NATIONAL LABOR
RELATIONS COMMISSION, Respondents

SYLLABUS
1. LABOR AND SOCIAL LEGISLATIONS; LABOR LAW; PERIOD TO APPEAL
DECISION OF THE LABOR ARBITER TO THE NATIONAL LABOR RELATIONS
COMMISSION; TEN "CALENDAR" DAYS; PRINCIPALLY INTENDED MORE
FOR EMPLOYEES’ BENEFIT — We shall deal first with the timeliness of the appeal. It
is admitted that Lariosa filed his appeal on June 7, 1984 or after the lapse of fourteen
days from notice of the decision of the Labor Arbiter. Article 223 of the Labor Code
clearly provides for a reglementary period of ten days within which to appeal s decision
of the Labor Arbiter to the NLRC. The ten-day period has been interpreted by this Court
in the case of Vir-jen Shipping and Marine Services, Inc. v. NLRC, G.R. No. 58011-12,
July 20, 1982, 115 SCRA 347, 361, to mean ten "calendar" days and not ten "working"
days. However, the "Notice of Decision" which Lariosa’s lawyer received together with a
copy of the arbiter’s decision advised them that an appeal could be taken to the NLRC
within ten "working" days from receipt of the said decision. Mindful of the fact that
Lariosa’s counsel must have been misled by the implementing rules of the labor
commission and considering that the shortened period for appeal is principally intended
more for the employees’ benefit, rather than that of the employer. We are inclined to
overlook this particular procedural lapse and to proceed with the resolution of the instant
case.

2. ID.; ID.; TERMINATION OF EMPLOYMENT; LOSS OF TRUST AND

CONFIDENCE; THEFT, VALID GROUND. — A review of the record shows that
Lariosa was indubitably involved in the attempted theft of the flannel swabs. During the
investigation called by the company’s industrial relations manager Ms. Villavicencio on
July 28, 1983, or one day after the incident. Security Guards Liso and Olvez contradicted
Lariosa’s bare claim that he had no intention to bring home the swabs and that he had
simply overlooked that he had earlier placed them inside his bag after they were given to
him by his shift supervisor while he was busy at work. Guard Olvez stated that when he
confronted Lariosa with the swabs, the latter replied that they were for "home use." And
when he requested Lariosa to stay behind while he reported the matter to the authorities,
Lariosa refused and hurriedly left the premises and boarded a passing jeepney. There is
no gainsaying that theft committed by an employee constitutes a valid reason for his
dismissal by the employer. Although as a rule this Court leans over backwards to help
workers and employees continue with their employment or to mitigate the penalties
imposed on them, acts of dishonesty in the handling of company property are a different
matter.

3. ID.; ID.; ID.; ID.; INVESTIGATION OF THEFT INCIDENT PRIOR TO

DISMISSAL; DUE PROCESS PROPERLY OBSERVED IN CASE AT BAR. — From
the records, it is likewise clear that Firestone did not act arbitrarily in terminating
Lariosa’s services. On the contrary, there are transcripts to prove that an investigation of
the incident was promptly conducted in the presence of the employee concerned, the
union president and the security guards who witnessed the attempted asportation. Records
also belie the allegation that Lariosa was shown his walking papers on the very day of the
incident. The letter of Ms. Villavicencio to Lariosa dated August 1, 1983 informing the
latter of his dismissal effective August 2, 1983 conclusively shows that he was
discharged only on August 2, 1983, after an investigation was held to ventilate the truth
about the July 27 incident. Thus, we cannot agree with the NLRC’s conclusion that even
if Firestone had found substantial proof of Lariosa’s misconduct, it did not observe the
statutory requirements of due process.

4. ID.; ID.; ID.; ID.; AUTHORITY TO DISMISS EMPLOYEE BASED ON

SUBSTANTIATED LOSS OF TRUST SHOULD NOT BE DENIED TO EMPLOYER.
— Thus, under Article 283 of the Labor Code, an employer may terminate an
employment for "serious misconduct" or for "Fraud or willful breach of the employee of
the trust reposed in him by his employer or representative." If there is sufficient evidence
that an employee has been guilty of a breach of trust or that his employer has ample
reasons to distrust him, the labor tribunal cannot justly deny to the employer the authority
to dismiss such an employee.

5. ID.; ID.; ID.; EMPLOYEE DISMISSED FOR LOSS OF TRUST AND

CONFIDENCE NOT ENTITLED TO BACKWAGES; PAYMENT OF SEPARATION
PAY ALLOWED. — The employer’s obligation to give him workers just compensation
and treatment carries with it the corollary right to expect from the workers adequate
work, diligence and good conduct. In view of the foregoing, We rule that Firestone had
valid grounds to dispense with the services of Lariosa and that the NLRC acted with
grave abuse of discretion in ordering his reinstatement. However, considering that
Lariosa had worked with the company for eleven years with no known previous bad
record, the ends of social and compassionate justice would be served if he is paid full
separation pay but not reinstatement without backwages as decreed by the NLRC.

DECISION
In this petition for certiorari, petitioner Firestone Tire and Rubber Company of the
Philippines [Firestone for brevity] assails the decision of public respondent National
Labor Relations Commission which ordered the reinstatement without backwages of
Carlos Lariosa, a dismissed tire builder of petitioner, as having been rendered with grave
abuse of discretion amounting to lack of jurisdiction.chanrobles law library : red

The facts are as follows:chanrob1es virtual 1aw library

Carlos Lariosa started working with Firestone on January 3, 1972 as a factory worker. At
the time of his dismissal, he was a tire builder.

At around 2:00 o’clock in the afternoon of July 27,1983, as he was about to leave the
company premises, Lariosa submitted himself to a routine check by the security guards at
the west gate. He was frisked by Security Guard Ambrosio Liso [Lizo] while his personal
bag was inspected by Security Guard Virgilio Olvez. In the course of the inspection,
sixteen [16] wool flannel swabs, all belonging to the company, were found inside his bag,
tucked underneath his soiled clothes.

As a result of the incident, Firestone terminated Lariosa’s services on August 2, 1983,

citing as grounds therefor: "stealing company property and loss of trust." 1 Firestone also
filed a criminal complaint against him with the Rizal provincial fiscal for attempted theft
[I.S. No. 83-436-M]. 2

Lariosa, on the other hand, sued Firestone before the Ministry of Labor and Employment
for illegal dismissal, violation of Batas Pambansa Blg. 130 and its related rules and
regulations, and damages. The labor Arbiter, in his decision dated May 8, 1984, found
Lariosa’s dismissal justified. 3 However, on appeal the National Labor Relations
Commission on December 28, 1984 reversed the decision of the Labor Arbiter [with one
 commissioner voting for affirmance] and held that the dismissal of Lariosa was too
severe a penalty. It therefore ordered Lariosa’s reinstatement but without backwages, the
period when he was out of work to be considered a suspension. 4

Petitioner Firestone, in this special civil action for certiorari, contends that the NLRC
erred in not dismissing Lariosa’s appeal for being late, in finding that Lariosa was not
accorded due process and in reversing the Labor Arbiter.chanrobles virtual lawlibrary

We shall deal first with the timeliness of the appeal. It is admitted that Lariosa filed his
appeal on June 7, 1984 or after the lapse of fourteen days from notice of the decision of
the Labor Arbiter. Article 223 of the Labor Code clearly provides for a reglementary
period of ten days within which to appeal a decision of the Labor Arbiter to the NLRC.
The ten-day period has been interpreted by this Court in the case of Vir-jen Shipping and
Marine Services, Inc. v. NLRC, G.R. No. 58011-12, July 20, 1982, 115 SCRA 347, 361,
to mean ten "calendar" days and not ten "working" days. However, the "Notice of
Decision" which Lariosa’s lawyer received together with a copy of the arbiter’s decision
advised them that an appeal could be taken to the NLRC within ten "working" days from
receipt of the said decision. 5
Mindful of the fact that Lariosa’s counsel must have been misled by the implementing rules of
the labor commission and considering that the shortened period for appeal is principally
intended more for the employees’ benefit, rather than that of the employer, We are inclined to
overlook this particular procedural lapse and to proceed with the resolution of the instant case.

A review of the record shows that Lariosa was indubitably involved in the attempted theft of the
flannel swabs. During the investigation called by the company’s industrial relations manager
Ms. Villavicencio on July 28, 1983, or one day after the incident, Security Guards Liso and
Olvez contradicted Lariosa’s bare claim that he had no intention to bring home the swabs and
that he had simply overlooked that he had earlier placed them inside his bag after they were
given to him by his shift supervisor while he was busy at work. Guard Olvez stated that when
he confronted Lariosa with the swabs, the latter replied that they were for "home use." And
when he requested Lariosa to stay behind while he reported the matter to the authorities, Lariosa
refused and hurriedly left the premises and boarded a passing jeepney. 6

From the records, it is likewise clear that Firestone did not act arbitrarily in terminating
Lariosa’s services. On the contrary, there are transcripts to prove that an investigation of the
incident was promptly conducted in the presence of the employee concerned, the union
president and the security guards who witnessed the attempted asportation. Records also belie
the allegation that Lariosa was shown his walking papers on the very day of the incident. The
letter of Ms. Villavicencio to Lariosa dated August 1, 1983 informing the latter of his dismissal
effective August 2, 1983 conclusively shows that he was discharged only on August 2, 1983,
after an investigation was held to ventilate the truth about the July 27 incident. 7 Thus, we
cannot agree with the NLRC’s conclusion that even if Firestone had found substantial proof of
Lariosa’s misconduct, it did not observe the statutory requirements of due process.

There is no gainsaying that theft committed by an employee constitutes a valid reason for his
dismissal by the employer. Although as a rule this Court leans over backwards to help workers
and employees continue with their employment or to mitigate the penalties imposed on them,
acts of dishonesty in the handling of company property are a different matter. 8

Thus, under Article 283 of the Labor Code, an employer may terminate an employment for
"serious misconduct" or for "fraud or willful breach by the employee of the trust reposed in him
by his employer or representative."cralaw virtua1aw library
If there is sufficient evidence that an employee has been guilty of a breach of trust or that his
employer has ample reasons to distrust him, the labor tribunal cannot justly deny to the
employer the authority to dismiss such an employee. 9

As a tire builder, Lariosa was entrusted with certain materials for use in his job. On the day in
question, he was given two bundles of wool flannel swabs [ten pieces per bundle] for cleaning
disks. He used four swabs from one pack and kept the rest [sixteen pieces] in his "blue
travelling bag." 10 Why he placed the swabs in his personal bag, which is not the usual
receptacle for company property, has not been satisfactorily explained.cralawnad

If Lariosa, by his own wrongdoing, could no longer be trusted, it would be an act of oppression
to compel the company to retain him, fully aware that such an employee could, in the long run,
endanger its very viability.

The employer’s obligation to give his workers just compensation and treatment carries with it
the corollary right to expect from the workers adequate work, diligence and good conduct. 11

In view of the foregoing, We rule that Firestone had valid grounds to dispense with the services
of Lariosa and that the NLRC acted with grave abuse of discretion in ordering his reinstatement.
However, considering that Lariosa had worked with the company for eleven years with no
known previous bad record, the ends of social and compassionate justice would be served if he
is paid full separation pay but not reinstatement without backages as decreed by the NLRC. 12

WHEREFORE, the petition is granted. The decision of the National Labor Relations
Commission dated December 28, 1984 is reversed and set aside. Petitioner Firestone Tire and
Rubber Company of the Philippines is directed to pay its dismissed worker Carlos Lariosa the
separation pay to which he may be entitled under the law, or any collective bargaining
agreement or company rules or practice, whichever is higher.
PETITION FOR AUTHORITY TO CONTINUE USE OF THE FIRM NAME
“SYCIP, SALAZAR, FELICIANO, HERNANDEZ & CASTILLO".
PETITION FOR AUTHORITY TO CONTINUE USE OF THE FIRM NAME
“SYCIP, SALAZAR, FELICIANO, HERNANDEZ & CASTILLO.”
July 30, 1979

Facts:
Petitions were filed by the surviving partners of Atty. Alexander Sycip, who died on
May 5, 1975 and by the surviving partners of Atty. Herminio Ozaeta, who died on
February 14, 1976, praying that they be allowed to continue using, in the names of
their firms, the names of partners who had passed away.
Petitioners contend that the continued use of the name of a deceased or former
partner when permissible by local custom, is not unethical but care should be taken
that no imposition or deception is practiced through this use. They also contend that
no local custom prohibits the continued use of a deceased partner’s name in a
professional firm’s name; there is no custom or usage in the Philippines, or at least
in the Greater Manila Area, which recognizes that the name of a law firm
necessarily identifies the individual members of the firm.
Issue:
WON the surviving partners may be allowed by the court to retain the name of the
partners who already passed away in the name of the firm? NO

Held:
In the case of Register of Deeds of Manila vs. China Banking Corporation, the SC
said:
The Court believes that, in view of the personal and confidential nature of the
relations between attorney and client, and the high standards demanded in the
canons of professional ethics, no practice should be allowed which even in a remote
degree could give rise to the possibility of deception. Said attorneys are accordingly
advised to drop the names of the deceased partners from their firm name.
The public relations value of the use of an old firm name can tend to create undue
advantages and disadvantages in the practice of the profession. An able lawyer
without connections will have to make a name for himself starting from scratch.
Another able lawyer, who can join an old firm, can initially ride on that old firm’s
reputation established by deceased partners.
The court also made the difference from the law firms and business corporations:
A partnership for the practice of law is not a legal entity. It is a mere relationship or
association for a particular purpose. … It is not a partnership formed for the purpose
of carrying on trade or business or of holding property.” Thus, it has been stated
that “the use of a nom de plume, assumed or trade name in law practice is improper.
We find such proof of the existence of a local custom, and of the elements requisite
to constitute the same, wanting herein. Merely because something is done as a
matter of practice does not mean that Courts can rely on the same for purposes of
adjudication as a juridical custom.
Petition suffers legal and ethical impediment
 [ G . R . No . 110668 . February 6 , 1997 ] SMITH , BELL & CO, INC . ,
Petitioner , vs. COURT OFAPPEALS and JOSEPH BENGZON CHUA ,

Respondents
. ; PANGANIBAN , J
FACTS:
July 1982: the plaintiffs, doing business under the style of Tic Hin Chiong, Importer, bought
and imported to thePhilippines from the firm Chin Gact Co ., Ltd . of Taipei , Taiwan , 50
metric tons of Dicalcium Phospate , These werecontained in 1 , 250 bags and shipped from the
Port of Kaohsiung, Taiwan for the Port of Manila . On July 27, 1982,
This shipment was insured by the defendant First Insurance Co and stamped by Smith, Bell and
Co as “claim
Agent.) `against
All risks’. Upon arrival, the shipped goods were not complete (
Of the 1,250 bags of the importedmaterial , 600 were damaged by tearing at the sides of the
container bags and the contents partly empty. Also, thecontents of the damaged bags were
found to be 18, 546 . 0 kg short).October 16, the plaintiff filed with Smith, Bell, and Co., Inc a
formal statement of claim with proof of loss and a demandfor settlement of the corresponding
value of the losses. But Smith, Bell and Co. denied liability. They said that a claimagent is not
personally liable under a policy in which it has not even taken part of.
ISSUE
: WON a local settling or claim agent of a disclosed principal, a foreign insurance company, can
be held jointlyand severally liable with said pr
Incipal under the latter’
S marine cargo insurance policy, given that the agent is not aparty to the insurance contract-
HELD:
NO. This is because of four reasons
RATIO:
1. Jurisprudence: Salonga v. Warner, Barnes & Co
.
An adjustment and settlement agent is no different fromany other agent from the point of view
of his responsibility, for he also acts in a representativecapacity. Whenever he adjusts or settles
a claim, he does it in behalf of his principal, and his action isbinding not upon himself but upon
his principal. And here again, the ordinary rule of agency applies. ->Thus, an adjustment and
settlement agent do not include personal liability. His functions are merely to settleand adjusts
claims in behalf of his principal if those claims are proven and undisputed, and if the claim
isdisputed or is disapproved by the principal, like in the instant case, the agent does not assume
any personalliability. The recourse of the insured is to press his claim against the principal.
2. Absence of Solidary Liability
:
There is a solidary liability only when the obligation expressly so states, orwhen the law or the
nature of the obligation requires solidarity. The Insurance Code is quite clear as to thepurpose
and role of a resident agent. Such agent, as a representative of the foreign insurance company,
istasked only to receive legal processes on behalf of its principal and not to answer personally
for any insuranceclaims.
Sec. 190
: On whom any notice provided by law or by any insurance policy, proof of loss, summons and
other legalprocesses may be served in all actions or other legal proceedings against such
company, and consenting thatservice upon such general agent shall be admitted and held as
valid as if served upon the foreign company at itshome office.In the case at bar, the trial court
had to order the service of summons upon First Insurance Co., Ltd. Which wouldnot have been
necessary if petitioner was its resident agent.
3. Not Real Party – In Interest:
Lastly, being a mere agent and representative, petitioner is also not the realparty – in - interest
in this case.
4. Resort to Equity Misplaced:
Finally, respondent Court also contends that “the interest of justice is better served by holding
the settling agent jointly and severally liable with its principal. “As no law backs up such
pronouncement, the appellate Court is thus resorting to equity. However , equity which has
been aptlydescribed as “ justice outside legality , “is availed of only in the absence of , and
never against , statutorylaw or judicial pronouncements.