Académique Documents
Professionnel Documents
Culture Documents
Private Corporations
Author: Hector S. De Leon
2013 Revised Edition
Prepared by
ANGELO ANDRO M. SUAN, CPA
PARTNERSHIP
(ARTICLES 1767-1867, CIVIL CODE)
GENERAL PROVISIONS
ARTICLE 1767:
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.
Two or more persons may also form a
partnership for the exercise of a profession.
Other definitions of partnership:
An association of two or more persons to carry
loss.
Partnership for the exercise of a profession:
A profession is a calling in the preparation
for or practice of which academic learning is
required and which has for its prime purpose
the rendering of public service.
Paragraph 2 relates to a general professional
partnership or a partnership for the exercise of
a profession. Strictly speaking, the practice of a
profession is not a business or an enterprise for
profit.
Note: the law does not allow individuals to
practice a profession as a corporate entity. The
reason is that personal qualifications (e.g., age,
good moral character, college degree) for such
practice cannot be possessed by a corporation.
Characteristics/elements of Partnership
Consensual
Nominate
Bilateral
Onerous
Commutative
Principal
Preparatory
Essential Features of Partnership
There must be a valid contract
the contract
There must be mutual contribution of money,
A, and
B
As a consequence of the distinct legal personality
possessed by X & Co., it may be declared insolvent
or bankrupt even if A and B are not; it may enter
into contracts and may sue and be sued; and the
death of either A and B is not ground for the
dismissal of a pending suit against X & Co.
Neither A nor B may sue on a cause of action
belonging to X & Co., in his own name and for his
own benefit. A and B cannot be held liable for the
obligations of X & Co. To creditors except as
provided in Article 1816.
Effect of failure to comply with statutory
requirements
Under Article 1772, this article makes it clear