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GREGORIO F. ORTEGA v. HON.

COURT OF APPEALS
G.R. No. 109248. July 3, 1995
Facts:
Ortega was then a senior partner in the law firm Bito, Misa, and Lozada withdrew in said firm. Consequently, he filed with
SEC a petition for dissolution and liquidation of partnership. However, the latter (SEC) ruled in an en banc decision that withdrawal of
Misa from the firm had dissolved the partnership. The reason according to said was to the effect that since it is partnership at will,
the law firm could be dissolved by any partner at anytime, such as by withdrawal therefrom, regardless of good faith or bad faith,
since no partner can be forced to continue in the partnership against his will.
Issue:
1. WON the partnership of Bito, Misa & Lozada (now Bito, Lozada, Ortega & Castillo) is a partnership at will;
2. WON the withdrawal of Misa dissolved the partnership regardless of his good or bad faith;
Held:
1. Yes. The partnership agreement of the firm provides that [t]he partnership shall continue so long as mutually
satisfactory and upon the death or legal incapacity of one of the partners, shall be continued by the surviving partners.2. Yes. Any
one of the partners may, at his sole pleasure, dictate a dissolution of the partnership at will (e.g. by way of withdrawal of a partner).
He must, however, act in good faith, not that the attendance of bad faith can prevent the dissolution of the partnership but that it
can result in a liability for damages
ISABELO MORAN, JR. v. THE HON. COURT OF APPEALS and MARIANO E. PECSON
G.R. No. 59956. October 31, 1984

Business Organization Partnership, Agency, Trust Profit and Loss Sharing Speculative Damages
FACTS:
In February 1971, Isabelo Moran and Mariano Pecson entered into a partnership agreement where they agreed to contribute
P15k each for the purpose of printing 95k posters of the delegates to the then 1971 Constitutional Commission. Moran shall be in
charge in managing the printing of the posters. It was further agreed that Pecson will receive a commission of P1k a month starting
from April 1971 to December 1971; that the partnership is to be liquidated on December 15, 1971.
Pecson partially fulfilled his obligation to the partnership when he issued P10k in favor of the partnership. He gave the P10k
to Moran as the managing partner. Moran however did not add anything and, instead, he only used P4k out of the P10k in printing
2,000 posters. He only printed 2,000 posters because he felt that printing all 95k posters is a losing venture because of the delay by
the COMELEC in announcing the full delegates. All the posters were sold for a total of P10k.
Pecson sued Moran. The trial court ordered Moran to pay Pecson damages. The Court of Appeals affirmed the decision of the
trial court but modified the same as it ordered Moran to pay P47.5k for unrealized profit; P8k for Pecsons monthly commissions; P7k
as return of investment because the venture never took off; plus interest.
ISSUE:
Whether or not the CA judgment is correct.
HELD:
No. The award of P47.5k for unrealized profit is speculative. There is no evidence whatsoever that the partnership between
the Moran and Pecson would have been a profitable venture (because base on the circumstances then i.e. the delay of the COMELEC
in proclaiming the candidates, profit is highly unlikely). In fact, it was a failure doomed from the start. There is therefore no basis for
the award of speculative damages in favor of Pecson. Further, there is mutual breach in this case, Pecson only gave P10k instead of
P15k while Moran gave nothing at all.
As for the P8k monthly commission, this is without basis. The agreement does not state the basis of the commission. The
payment of the commission could only have been predicated on relatively extravagant profits. The parties could not have intended
the giving of a commission inspite of loss or failure of the venture. Since the venture was a failure, Pecson is not entitled to the P8k
commission.
As for the P7k award as return for Pecsons investment, the CA erred in his ruling too. Though the venture failed, it did took
off the ground as evidenced by the 2,000 posters printed. Hence, return of investment is not proper in this case. There are risks in

any business venture and the failure of the undertaking cannot entirely be blamed on the managing partner alone, specially if the
latter exercised his best business judgment, which seems to be true in this case.
Moran must however return the unused P6k of Pecsons contribution to the partnership plus P3k representing Pecsons profit
share in the sale of the printed posters. Computation of P3k profit share is as follows: (P10k profit from the sale of the 2,000 posters
printed) (P4k expense in printing the 2k posters) = (P6k profit); Profit 2 = P3k each.

WILLIAM UY VS. BARTOLOME PUZON substituted by FRANCO PUZON


G.R. No. L-19819. October 26, 1977
CASE DIGEST

FACTS:

Puzon entered into a contract with the Republic of the Philippines for the construction of a road and 5 bridges. However,
Puzon found difficulty in accomplishing both projects, so he established a partnership with Uy as sub-contractor of the projects for
financial assistance and the profits shall be divided equally between them; the resulting partnership is UP Construction Company.
The partners agreed to contribute P50, 000 each as capital. However, Puzon failed to pay but promised to contribute his
share as soon as his application of loan with the PNB shall be approved. Uy gave Puzon advance contribution of his share in
partnership for Puzon top pay his obligations with PNB.
Uy was entrusted with the management of the project since Puzon is busy with his other projects; whatever expense Uy
may incur shall be considered part of his contribution. Upon approval of Puzons loan with the PNB, he gave Uy P60, 000 for
reimbursement of Uys contribution and Puzons contribution to the partnership capital. To guarantee the payment of the loan, Puzon
assigned to PNB all payments to be received on account of the contracts with the Bureau of Public Highways for the construction; this
was done without the knowledge and consent of Uy.
Financial demands of the project increased, thus, Uy called on Puzon to place his capital contribution; Puzon failed to do so.
Uy thereafter sent letters of demand to which Puzon replied that hes not capable of putting additional capital. Puzon wrote UP
Construction Company terminating their subcontract agreement.
Uy was then not allowed in the office of UP Construction Company and his authority to deal with BPH was revoked. Hence,
he instituted an action against Puzon seeking the dissolution of the partnership and payment of damages for the violation of the
latter of the terms of their partnership agreement. RTC found that Puzon failed to contribute his share in the capital of the
partnership and caused the failure of partnership to realize expected profits. The court ordered the dissolution of the partnership and
Puzon to pay Uy a certain sum. Franco Puzon substituted Bartolome Puzon on the appeal of the case before the Supreme Court.
ISSUE/S:
W/N the amount of money ordered by the trial court for the failure to contribute his share in the capital of the partnership is proper.
RULING:
The award of P200,000.00 as his share in the unrealized profits of the partnership is proper. Under Article 2200 of the Civil
Code, indemnification for damages shall comprehend not only the value of the loss suffered, but also that of the profits which the
obligee failed to obtain. In other words lucrum cessans is also a basis for indemnification. There is no doubt Uy failed to make profits
because of Puzon's breach of contract. The partnership showed some profits even though the profit and loss statement showed net
loss; it may be due to error in accounting.
Had the appellant not been remiss in his obligations as partner and as prime contractor of the construction projects in
question as he was bound to perform pursuant to the partnership and subcontract agreements, and considering the fact that the
total contract amount of these two projects is P2,327,335.76, it is reasonable to expect that the partnership would have earned
much more than the P334,255.61 We have hereinabove indicated. The award, therefore, made by the trial court of the amount of
P200,000.00, as compensatory damages, is not speculative, but based on reasonable estimate.
As cited in Moran vs. CA:
The rule is, when a partner who has undertaken to contribute a sum of money fails to do so, he becomes a debtor of the
partnership for whatever he may have promised to contribute (Art. 1786, Civil Code) and for interests and damages from the time he
should have complied with his obligation (Art. 1788, Civil Code). Thus in Uy v. Puzon (79 SCRA 598), which interpreted Art. 2200 of
the Civil Code of the Philippines, we allowed a total of P200,000.00 compensatory damages in favor of the appellee because the
appellant therein was remiss in his obligations as a partner and as prime contractor of the construction projects in question. This
case was decided on a particular set of facts. We awarded compensatory damages in the Uy case because there was a finding that
the constructing business is a profitable one and that the UP construction company derived some profits from its contractors in the
construction of roads and bridges despite its deficient capital. Besides, there was evidence to show that the partnership made some
profits during the periods from July 2, 1956 to December 31, 1957 and from January 1, 1958 up to September 30, 1959. The profits
on two government contracts worth P2,327,335.76 were not speculative. In the instant case, there is no evidence whatsoever that
the partnership between the petitioner and the private respondent would have been a profitable venture. In fact, it was a failure
doomed from the start. There is therefore no basis for the award of speculative damages in favor of the private respondent.

Furthermore, in the Uy case, only Puzon failed to give his full contribution while Uy contributed much more than what was
expected of him.
EVANGELISTA & CO., et al. v. ESTRELLA ABAD SANTOS
G.R. No. L-31684. June 28, 1973
FACTS:
On October 9, 1954 a co-partnership was formed under the name of "Evangelista & Co." On June 7, 1955 the Articles of Copartnership were amended so as to include herein respondent, Estrella Abad Santos, as industrial partner, with herein petitioners
Domingo C. Evangelista, Jr., Leonarda Atienza Abad Santos and Conchita P. Navarro, the original capitalist partners, remaining in that
capacity, with a contribution of P17,500 each
On December 17, 1963 herein respondent filed suit against the three other partners, alleging that the partnership, which
was also made a party-defendant, had been paying dividends to the partners except to her; and that notwithstanding her demands
the defendants had refused and continued to refuse to let her examine the partnership books or to give her information regarding
the partnership affairs or to pay her any share in the dividends declared by the partnership.
The defendants, in their answer, denied ever having declared dividends or distributed profits of the partnership; denied
likewise that the plaintiff ever demanded that she be allowed to examine the partnership books; and by way of affirmative defense
alleged that the amended Articles of Co-partnership did not express the true agreement of the parties, which was that the plaintiff
was not an industrial partner; that she did not in fact contribute industry to the partnership.
ISSUE: Whether Abad Santos is entitled to see the partnership books because she is an industrial partner in the partnership
HELD:
affairs:

Yes, Abad Santos is entitled to see the partnership books.


The Supreme Court ruled that according to ART. 1299. Any partner shall have the right to a formal account as to partnership
(1)If he is wrongfully excluded from the partnership business or possession of its property by his co-partners;
(2)If the right exists under the terms of any agreement;
(3)As provided by article 1807;
(4)Whenever other circumstances render it just and reasonable."

In the case at hand, the company is estopped from denying Abad Santos as an industrial partner because it has been 8
years and the company never corrected their agreement in order to show their true intentions. The company never bothered to
correct those up until Abad Santos filed a complaint.
MARSMAN DRYSDALE LAND, INC., VS. PHILIPPINE GEOANALYTICS, INC. AND GOTESCO PROPERTIES, INC.
G.R. No. 183374 : June 29, 2010
Facts:
Marsman Drysdale, Inc. (Marsman) and Gotesco Properties, Inc. (Gotesco) entered into a joint venture agreement for the
construction and development of an office building on a land owned by Marsman. They agreed on a 50-50 ratio on the proceeds of
the project, but did not agree on how losses would be divided. The joint venture engaged the services of Philippine Geoanalytics, Inc.
(PGI) to provide subsurface soil exploration, seismic study and geotechnical engineering. PGI completed its seismic study but failed
to complete its subsurface soil exploration because the area where drilling was to be made had not been cleared. The building project
was subsequently shelved due to unfavorable economic conditions. PGI billed the joint venture for work done, but was not paid
despite its repeated demands. PGI, thus, filed a collection case against Marsman and Gotesco. Marsman passed the obligation to
Gotesco because under the joint venture agreement, Gotesco was solely liable for the monetary expenses of the project, and
Marsmans participation was limited to the land. Gotesco, on the other hand, asserted that PGI had to cause of action against it as
PGI had yet to complete the services in itscontract, and it was Marsmans failure to clear the property of debris which prevented PGI
from completing its work.
Issue:

Who between Marsman and Gotesco was liable to pay PGI its unpaid claims?

Held:
Marsman and Gotesco are jointly liable to PGI.
PGI was never a party to the joint venture agreement. While the joint venture agreement clearly spelled out the capital
contributions of Marsman (land) and Gotesco (cash) and the funding mechanism, it cannot be used to defeat the lawful claim of
PGI against the two joint venturers-partners. PGIs contract clearly listed the joint venturers Marsman and Gotesco as the
beneficial owner of the project, and all billing invoices indicated the consortium as the client.
When there are two or more debtors, the obligation is presumed to be joint unless the law or the obligation expressly states
that the liability is solidary, or unless the nature of the obligation requires solidary liability (Articles 1207 and 1208, Civil
Code). In this case, since solidaryliability was not required by law, or the contract, or by the nature of the obligation, the
obligation to PGI was presumed to be joint between Marsman and Gotesco.
A joint venture being a form of partnership, it is to be governed by the laws on partnership. Under the laws on
partnership, particularly Article 1797 of the Civil Code, the losses and profits shall be distributed in accordance 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 joint venture agreement, Marsman and Gotesco agreed on a 50-50 ratio on the proceeds of the project, but did not
provide for the splitting of losses. Applying Article 1797, the same ratio applies in splitting the obligation-loss of the joint venture to
PGI.
FEDERICO JARANTILLA VS. ANTONIETA JARANTILLA
G.R. No. 154486, December 01 : 2010
FACTS:
The present case stems from the complaint filed by Antonieta Jarantilla against Buenaventura Remotigue, Cynthia
Remotigue, Federico Jarantilla, Jr., Doroteo Jarantilla and Tomas Jarantilla, for the accounting of the assets and income of the coownership, for its partition and the delivery of her share corresponding to eight percent (8%), and for damages. Antonieta claimed
that in 1946, she had entered into an agreement with the defendants to engage in business through the execution of a document
denominated as "Acknowledgement of Participating Capital. Antonieta also alleged that she had helped in the management of the
business they co-owned without receiving any salary. Antonieta further claimed co-ownership of certain properties (the subject real
properties) in the name of the defendants since the only way the defendants could have purchased these properties were through
the partnership as they had no other source of income. The respondents did not deny the existence and validity of
the"Acknowledgement of Participating Capital" and in fact used this as evidence to support their claim that Antonietas 8% share was
limited to the businesses enumerated therein. The respondents denied using the partnerships income to purchase the subject real
properties.
During the course of the trial at the RTC, petitioner Federico Jarantilla, Jr., who was one of the original defendants, entered
into a compromise agreement with Antonieta Jarantilla wherein he supported Antonietas claims and asserted that he too was
entitled to six percent (6%) of the supposed partnership in the same manner as Antonieta was.
ISSUE:

Whether or not the partnership subject of the Acknowledgement of Participating Capital funded the subject real properties.

HELD:
Under Article 1767 of the Civil Code, there are two essential elements in a contract of partnership:(a) an agreement to
contribute money, property or industry to a common fund; and (b) intent to divide the profits among the contracting parties. The
first element is undoubtedly present in the case at bar, for, admittedly, all the parties in this case have agreed to, and did, contribute
money and property to a common fund. Hence, the issue narrows down to their intent in acting as they did. It is not denied that all
the parties in this case have agreed to contribute capital to a common fund to be able to later on share its profits. They have
admitted this fact, agreed to its veracity, and even submitted one common documentary evidence to prove such partnership - the
Acknowledgement of Participating Capital. The petitioner himself claims his share to be 6%, as stated in the Acknowledgement of
Participating Capital. However, petitioner fails to realize that this document specifically enumerated the businesses covered by the
partnership: Manila Athletic Supply, Remotigue Trading in Iloilo City and Remotigue Trading in Cotabato City. Since there was a clear
agreement that the capital the partners contributed went to the three businesses, then there is no reason to deviate from such
agreement and go beyond the stipulations in the document. There is no evidence that the subject real properties were assets of the
partnership referred to in the Acknowledgement of Participating Capital. Petition denied.
CHOITHRAM JETHMAL RAMNANI and/or NIRMLA V. RAMNANI AND MOTI G. RAMNANI v. COURT OF APPEALS
G.R. No. 85494. May 7, 1991
FACTS:
Ishwar Jethmal Ramnani and his wife Sonya had their main business based in New York. Ishwar received US $150,000.00
from his father-in-law in Switzerland. In 1965, Ishwar Jethmal Ramnani sent the amount of US $150,000.00 to Choithram in two
bank drafts of US$65,000.00 and US$85,000.00 for the purpose of investing the same in real estate in the Philippines. Subsequently,
spouses Ishwar executed a general power of attorney appointing Ishwars full blood brothers Choithram and Navalrai as attorneys-infact, empowering them to manage and conduct their business concerns in the Philippines.
Choithram, as attorney-in-factr, entered into two agreements for the purchase of two parcels of land located in Pasig Rizal
from Ortigas & Company, Ltd. Partnership (Ortigas Ltd.) with a total area of approximately 10,048 square meters. Three buildings
were constructed thereon and were leased out by Choithram as attorney-in-fact of spouses Ishwar. Two of these buildings were later
burned.
In 1970 Ishwar asked Choithram to account for the income and expenses relative to these properties during the period 1967
to 1970. Choithram failed and refused to render such accounting which prompted Ishwar to revoke the general power of attorney.
Choithram and Ortigas Ltd. were duly notified by notice in writing of such revocation. It was also registered with the
Securities and Exchange Commission and published in The Manila Times. Nevertheless, Choithram as such attorney-in-fact of Ishwar,
transferred all rights and interests of Ishwar spouses in favor of Nirmla Ramnani, the wife of Choitrams son, Moti. Ortigas also
executed the corresponding deeds of sale in favor of Nirmla and the TCT ISSUEd in her favour..
Thus, spouses Ishwar filed a complaint in the Court of First Instance of Rizal against Choithram and spouses Nirmla and Moti
(Choithram et al.) and Ortigas Ltd. for reconveyance of said properties or payment of its value and damages. Trial court dismissed
the complaint ruling that the lone testimony of Ishwar regarding the cash remittance is unworthy of faith and credit because the cash
remittance was made before the execution of the general power of attorney. Ishwar also failed to corroborate this lone testimony and

did not exhibit any commercial document as regard to the alleged remittances. It believed the claim of Choitram that he and Ishwar
entered into a temporary arrangement in order to enable Choithram, then a British citizen, to purchase the properties in the name of
Ishwar who was an American citizen and who was then qualified to purchase property in the Philippines under the then Parity
Amendment.
Upon appeal, the CA reversed the decision and gave credence to Ishwar. It upheld the validity of Ishwars testimony and
gave cognizance to a letter written by Choihtram imploring Ishwar to renew the power of attorney after it was revoked. It states
therein that Choithram reassures his brother that he is not after his money and that the revocation is hurting the reputation of
Ishwar. Choithram also made no mention of his claimed temporary arrangement in the letter. The CA ruled that Choithram is also
estopped in pais or by deed from claiming an interest over the properties. Because of Choitrams admissions from (1) power of
attorney, (2) the Agreements, and (3) the Contract of Lease. It furthermore HELD that Choithram's 'temporary arrangement, by
which he claimed purchasing the two (2) parcels in question in 1966 and placing them in the name of Ishwar who is an American
citizen circumvents the disqualification provision of aliens acquiring real properties in the Philippines. Upholding the supposed
"temporary arrangement" with Ishwar would be sanctioning the perpetration of an illegal act and culpable violation of the
Constitution.
During the pendency of the case, Choithram made several attempts to dispose of his properties by way of donation and also
mortgaged the properties under litigation for 3 million USD to a shell partnership with a mere capital of 100 USD.
The Supreme Court affirms the findings of the Court of Appeals.
ISSUES:
1.
2.

Whether or not there was a partnership between the brothers Ishwar and Choithram
Whether or not Ortigas Ltd. is liable.

HELD:
1.

Yes, there is a partnership between the brothers even without a written agreement, the scenario is clear. Spouses Ishwar
supplied the capital of $150,000.00 for the business. They entrusted the money to Choithram to invest in a profitable
business venture in the Philippines. For this purpose they appointed Choithram as their attorney-in-fact.

Choithram in turn decided to invest in the real estate business. He bought the two (2) parcels of land in question from
Ortigas as attorney-in-fact of Ishwar- Instead of paying for the lots in cash, he paid in installments and used the balance of the
capital entrusted to him, plus a loan, to build two buildings. Although the buildings were burned later, Choithram was able to build
two other buildings on the property. He rented them out and collected the rentals. Through the industry and genius of Choithram,
Ishwar's property was developed and improved into what it is nowa valuable asset worth millions of pesos.
We have a situation where two brothers engaged in a business venture. One furnished the capital, the other contributed his
industry and talent. Justice and equity dictate that the two share equally the fruit of their joint investment and efforts. Perhaps this
Solomonic solution may pave the way towards their reconciliation. Both would stand to gain. No one would end up the loser. After all,
blood is thicker than water.
However, because of the devious machinations and schemes that Choithram employed he should pay moral and exemplary
damages as well as attorney's fees to spouses Ishwar.
2.

Yes, because Ortigas had several notices of the revocation. Despite said notices, Ortigas nevertheless acceded to the
representation of Choithram, as alleged attorney-in-fact of Ishwar, to assign the rights of petitioner Ishwar to Nirmla. While
the primary blame should be laid at the doorstep of Choithram, Ortigas is not entirely without fault. It should have required
Choithram to secure another power of attorney from Ishwar. For recklessly believing the pretension of Choithram that his
power of attorney was still good, it must, therefore, share in the latter's liability to Ishwar.
E. M. BACHRACH v. "LA PROTECTORA" ET AL.
G.R. No. L-11624. January 21, 1918

Facts:

Nicolas Segundo, Antonio Adiarte, Ignacio Flores and Modesto Serrano (defendants) formed a civil partnership called La
Protectora for the purpose of engaging in the business of transporting passengers and freight at Laoag, Ilocos Norte. Marcelo Barba,
acting as manager, negotiated for the purchase of 2 automobile trucks from E. M. Bachrach for P16,500. Barba paid P3,000 in cash
and for the balance executed promissory notes.
One of these promissory notes was signed in the following manner: P.P La Protectora, By Marcelo Barba Marcelo Barba
The other 2 notes were signed in the same way but the word by was omitted. It was obvious that in signing the notes, Barba
intended to bind both the partnership and himself.
The defendants executed a document in which they declared that they were members of La Protectora and that they had
granted to its president full authority to contract for the purchase of the 2 automobiles. The document was delivered by Barba to
Bachrach at the time the vehicles were purchased.
Barba incurred a debt amounting to P2,617.57 and Bachrach foreclosed a chattel mortgage on the trucks but there was still
balance. To recover the balance, action was instituted against the defendants. Judgment was rendered against the defendants.

Issue:
a.Whether or not the defendants are liable for the firm debts.
b.Whether or not Barba had authority to incur expenses for the partnership (relevant issue)
Held:
a.Yes. Promissory notes constitute the obligation exclusively of La Protectora and Barba. They do not constitute an obligation directly
binding the defendants. Their liability is based on the principles of partnership liability. A member is not liable in solidum with his
fellows for the entire indebtedness but is liable with them or his aliquot part.
SC obiter: the document was intended merely as an authority to enable Barba to bind the partnership and that the parties to the
instrument did not intend to confer upon Barba an authority to bind them personally.
b. Yes. Under Art 1804, every partner may associate another person with him in his share. All partners are considered agents of the
partnership. Barba must be held to have authority to incur these expenses. He is shown to have been in fact the president/manager,
and there can be no doubt that he had actual authority to incur obligation.
ANTONIO LIM TANHU v. HON. JOSE R. RAMOLETE
G.R. No. L-40098. August 29, 1975
FACTS:
Private respondent Tan Put alleged that she is the widow of Tee Hoon Lim Po Chuan, who was a partner and practically the
owner who has controlling interest of Glory Commercial Company and a Chinese Citizen until his death. Defendant Antonio Lim
Tanhu and Alfonso Leonardo Ng Sua were partners in name but they were mere employees of Po Chuan and were naturalized Filipino
Citizens. Tan Put filed complaint against spouses-petitoner Lim Tanhu and Dy Ochay including their son Tech Chuan and the other
spouses-petitoner Ng Sua and Co Oyo including also their son Eng Chong Leonardo, that through fraud and machination took actual
and active management of the partnership and that she alleged entitlement to share not only in the capital and profits of the
partnership but also in the other assets, both real and personal, acquired by the partnership with funds of the latter during its
lifetime."
According to the petitioners, Ang Siok Tin is the legitimate wife, still living, and with whom Tee Hoon had four legitimate
children, a twin born in 1942, and two others born in 1949 and 1965, all presently residing in Hong Kong. Tee Hoon died in 1966 and
as a result of which the partnership was dissolved and what corresponded to him were all given to his legitimate wife and children.
Tan Put prior of her alleged marriage with Tee Hoon on 1949, was engaged in the drugstore business; that not long after her
marriage, upon the suggestion of the latter sold her drugstore for P125,000.00 which amount she gave to her husband as
investment in Glory Commercial Co. sometime in 1950; that after the investment of the above-stated amount in the partnership its
business flourished and it embarked in the import business and also engaged in the wholesale and retail trade of cement and GI
sheets and under huge profits.
Defendants interpose that Tan Put knew and was are that she was merely the common-law wife of Tee Hoon. Tan Put and
Tee Hoon were childless but the former had a foster child, Antonio Nunez.
ISSUE:

Whether Tan Put, as she alleged being married with Tee Hoon, can claim from the company of the latters share.

HELD:
Under Article 55 of the Civil Code, the declaration of the contracting parties that they take each other as husband and wife
"shall be set forth in an instrument" signed by the parties as well as by their witnesses and the person solemnizing the marriage.
Accordingly, the primary evidence of a marriage must be an authentic copy of the marriage contract. While a marriage may also be
proved by other competent evidence, the absence of the contract must first be satisfactorily explained. Surely, the certification of the
person who allegedly solemnized a marriage is not admissible evidence of such marriage unless proof of loss of the contract or of any
other satisfactory reason for its non-production is first presented to the court. In the case at bar, the purported certification issued by
a Mons. Jose M. Recoleto, Bishop, Philippine Independent Church, Cebu City, is not, therefore, competent evidence, there being
absolutely no showing as to unavailability of the marriage contract and, indeed, as to the authenticity of the signature of said
certifier, the jurat allegedly signed by a second assistant provincial fiscal not being authorized by law, since it is not part of the
functions of his office. Besides, inasmuch as the bishop did not testify, the same is hearsay.
An agreement with Tee Hoon was shown and signed by Tan Put that she received P40,000 for her subsistence when they
terminated their relationship of common-law marriage and promised not to interfere with each others affairs since they are
incompatible and not in the position to keep living together permanently. Hence, this document not only proves that her relation was
that of a common-law wife but had also settled property interests in the payment of P40,000.
IN VIEW OF ALL THE FOREGOING, the petition is granted. All proceedings held in respondent court in its Civil Case No.
12328 subsequent to the order of dismissal of October 21, 1974 are hereby annulled and set aside, particularly the ex-parte
proceedings against petitioners and the decision on December 20, 1974. Respondent court is hereby ordered to enter an order
extending the effects of its order of dismissal of the action dated October 21, 1974 to herein petitioners Antonio Lim Tanhu, Dy
Ochay, Alfonso Leonardo Ng Sua and Co Oyo. And respondent court is hereby permanently enjoined from taking any further action in
said civil case gave and except as herein indicated. Costs against private respondent.
DAN FUE LEUNG v. HON. INTERMEDIATE APPELLATE COURT and LEUNG YIU

G.R. No. 70926. January 31, 1989


FACTS:
The petitioner asks for the reversal of the decision of the Appellate Court in which affirmed the decision of the lower court
declaring private respondent Leung Yiu a partner of petitioner Dan Fue Leung in the business of Sun Wah Panciteria and ordering the
petitioner to pay to the private respondent his share in the annual profits of the said restaurant.
This case originated from a complaint filed by respondent Leung Yiu with the lower court to recover the sum equivalent to
twenty-two percent (22%) of the annual profits derived from the operation of Sun Wah Panciteria since October, 1955 from petitioner
Dan Fue Leung.
The Sun Wah Panciteria was registered as a single proprietorship and its licenses and permits were issued to and in favor of
petitioner Dan Fue Leung as the sole proprietor. Respondent Leung Yiu adduced evidence during the trial of the case to show that
Sun Wah Panciteria was actually a partnership and that he was one of the partners having contributed P4,000.00 to its initial
establishment.
Lower court ruled in favor of the private respondent. Petitioner appealed the trial court's amended decision. However, the
questioned decision was further modified and affirmed by the appellate court. Both the trial court and the appellate court declared
that the private petitioner is a partner and is entitled to a share of the annual profits of the restaurant. Hence, an appeal to the SC.
The petitioner argues that private respondent extended 'financial assistance'to herein petitioner at the time of the establishment of
the Sun Wah Panciteria, in return of which private respondent allegedly will receive a share in the profits of the restaurant. It was,
therefore, error for the Appellate Court to interpretor construe 'financial assistance' to mean the contribution of capital by a partner
to a partnership.
ISSUE:
WON the private respondent is a partner of the petitioner in the establishment of Sun Wah Panciteria.
HELD:
In essence, the private respondent alleged that when Sun Wah Panciteria was established, he gave P4,000.00 to the
petitioner with the understanding that he would be entitled to twenty-two percent (22%) of the annual profit derived from the
operation of the said panciteria. These allegations, which were proved, make the private respondent and the petitioner partners in
the establishment of Sun Wah Panciteria because Article 1767 of the Civil Code provides that"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 the profits
among themselves".
Therefore, the lower courts did not err in construing the complaint as one wherein the private respondent asserted his rights
as partner of the petitioner in the establishment of the Sun Wah Panciteria, notwithstanding the use of the term financial assistance
therein.
SC affirmed appellate courts decision and ordered the dissolution of the partnership.
EMILIO EMNACE v. COURT OF APPEALS
G.R. No. 126334. November 23, 2001
CASE DIGEST
FACTS: Emilio Emnace, Jacinto Divinagracia and Vicente Tabanao formed a partnership engaged in the fishing industry. In 1986,
Jacinto decided to leave the partnership hence they agreed to dissolve the partnership. At that time, the partnership has an
estimated asset amounting to P30,000,000.00.
HOWEVER, until the death of Vicente Tabanao in 1994, Emnace never rendered an accounting either to Vicente or his heirs. Emnace
reneged on his promise to turn over Tabanaos share which is 1/3 of the P30M. The heirs of Tabanao then sued Emnace. Emnace
argued, among others, that the heirs are barred by prescription hence they can no longer demand an accounting. He contends that
the partnership was dissolved in 1986 and that was the time when Tabanaos (and his heirs) right to inquire into the business affairs
accrued; that said right has expired in 1990 or 4 years after. So beyond 1990, they can no longer inquire.
ISSUE: Whether or not Emnace is correct.
HELD: No. Prescription has not run in this case, it has never begun. The three final stages of partnership are: a) dissolution, b)
winding up, and c) termination. In this case, Emnace and his partners dissolved their partnership but such did not perfect the
dissolution because no accounting took place. The partnership, although dissolved, continues to exist and its legal personality is
retained, at which time it completes the winding up of its affairs, including the partitioning and distribution of the net partnership
assets to the partners. For as long as the partnership exists, any of the partners (or legal representative in this case the heirs of
Tabanao) may demand an accounting of the partnerships business. Prescription of the said right starts to run only upon the
dissolution of the partnership when the final accounting is done.
When a final accounting is made, it is only then that prescription begins to run. In the case at bar, no final accounting has been
made, and that is precisely what the heirs are seeking in their action before the trial court, since Emnace has failed or refused to
render an accounting of the partnerships business and assets. Hence, the said action is not barred by prescription.

NOTE: Under Article 1809 of the Civil Code, right to demand an accounting may also be invoked under certain agreements these
are just one of the exceptions. General Rule: Accounting only when there is dissolution. Exception: Article 1807 and 1809.