USA College of Law

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Case Name Navarro vs. Court of Appeals

Topic
Case No. |
G.R. No 101847 | May 27 1993
Date
Ponente MELO, J.
The Civil Code provides under Article 1771 and 1772 that while partnership may
be constituted in any form, a public instrument is necessary where immovables
Doctrine or any rights is constituted. Likewise, if the partnership involves a capitalization
of P3,000.00 or more in money or property, the same must appear in a public
instrument which must ben recorded in the Office of the SEC.
Link https://www.lawphil.net/judjuris/juri1993/may1993/gr_101847_1993.html

RELEVANT FACTS:
Private respondent Olivia Yanson filed a complaint against petitioner Lourdes Navarro for
"Delivery of Personal Properties with Damages". The complaint incorporated an application for a
writ of replevin. The Court of First Instance amended the case to include respondent's husband
Ricardo Yanson as co-plaintiff and petitioner's husband as co-defendant.
On July 1976 Executive Jude Victoriano approved the application for writ of replevin.

Presiding Judge rendered a decision disposing as follows: "hereby ordered to return to plaintiff
such other equipment[s] as were brought by the latter to and during the operation of business as
were listed in the complaint and not recovered by virtue of the writ.

Petitioner filed a motion for extension to file a motion for reconsideration and was granted. Private
respondents filed the opposition. The trial judge vacated the order.

The trial court issued a writ of execution. The Sheriff's Return of Service declared that the writ was
duly served and satisfied.

Petitioners filed a petition for annulment of the trial court's decision declaring the non-existence of
partnership, contrary to the evidence in record.

The appellate court outrightly dismissed the petition due to absence of extrinsic or collateral
fraud.

Petitioners claim that the trial judge ignored evidence that would show that the parties clearly
intended to form and actually formed a verbal partnership engaged in the business of Air Freight
Service Agency in Bacolod and that the decision sustaining the writ of replevin is void because the
properties belonging to the partnership do not belong to any parties until the final disposition and
winding up of the partnership.

Petitioners filed annulment proceedings on the judicial review of their case. It was thrown out by
the CA because petitioners fialed to cite extrinsic or collateral fraud to warrant the setting aside of
the trial court's decision.
 USA College of Law
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ISSUE: Whether or not there was a partnership that existed between the parties based on their
verbal contention?
RULING:
No. Article 1767 of the New Civil Code defines the contract of partnership to quote:

Art 1767. By the contract of partnership two or more persons bind themselves to contribute
money, property or industry to the common fund, with the intention of dividing the proceeds
among themselves.

Furthermore, the Code provides under Article 1771 and 1772 that while partnership may be
constituted in any form, a public instrument is necessary where immovables or any rights is
constituted. Likewise, if the partnership involves a capitalization of P3,000.00 or more in money
or property, the same must appear in a public instrument which must ben recorded in the Office
of the SEC.

While the plaintiff did supply the necessary equipment and money, while her brother was the
Manager and the defendant the Cashier, the evidence presented no proof that a partnership,
whether oral or written had been constituted at the inception of the transaction.

While there may have been co-ownership or co-possession of some items and/or sharing of
proceeds, these are not indicative and supportive of the existence of any partnership.

If follows therefore that there being no partnership that existed, any dissolution, liquidation or
winding up is beside the point.

The Court sustains the possession by the plaintiff of all equipment and chattels recovered by
virtue of the Writ of Replevin.

The plaintiff must be reimbursed of the cost of the disbursements if only to allow the defendant
continuous possession of the items (vehicle: Ford Fiera Jeep) in question.

RULING
WHEREFORE, the petition is DISMISSED. The Resolution of the Court of Appeals dated June 20,
1991 is AFFIRMED in all respects.

NOTES
Art 1767. By the contract of partnership two or more persons bind themselves to contribute
money, property or industry to the common fund, with the intention of dividing the proceeds
among themselves.