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 The contract is consensual.
 There must be a contribution of money, property or industry to a
common fund.
 The object must be a lawful one.
 There must be an intention of dividing the profit among the
 There must be the affectio societatis — the desire to formulate
an ACTIVE union
 Its juridical personality is SEPARATE and DISTINCT from that
of each of the partners.
 The partnership can, in general: acquire and possess property
of all kinds, incur obligations, bring civil or criminal actions,
can be adjudged INSOLVENT even if the individual members
be each financially solvent.
 Unless he is personally sued, a partner has no right to make
a separate appearance in court, if the partnership being sued
is already represented.

Fortis was a bookkeeper in a partnership named

“Gutierrez Hermanos”, with a yearly salary
amounting to 5% of the net profits for each year.
Fortis, however, had no vote at all in the
management of the business. Was he a partner?
Bastida worked for Menzi and Co., as procurer of contracts for
fertilizers to be manufactured by the fi rm, and as supervisor
of the mixing of the fertilizers. However, he had no voice in the
management of the business except in his task of supervising
the mixing of said fertilizers.
For his services, he was entitled to 35% of the net profits in
the fertilizer business. Aside from this, he sued the fi rm for
35% of the value of its goodwill on the ground that he had
become a partner thereof. Decide.
The object or purpose must be LAWFUL, i.e.,
it must be within the commerce of man,
possible, and not contrary to law, morals,
good customs, public order or public policy.

Is a Judicial Decree Needed to Dissolve

an Unlawful Partnership?
ANS.: No, for the contract is void from the very
beginning, and therefore never existed from the
viewpoint of the law. (See Art. 1409, Civil Code; see
also People v. Mendoza).

However, there would be nothing wrong in having the

court dissolve the partnership. This will be good and
convenient for everybody; moreover, there may be a
question as to whether or not the partnership is
indeed unlawful. This is particularly true when the
object was lawful at the beginning but has later on
become unlawful.
Whenever real properties or real rights in real properties are
contributed — regardless of the value — a PUBLIC INSTRUMENT is
needed. (The contract itself must be in the public instrument;
moreover, there must be an INVENTORY of the immovables. This
INVENTORY must be signed by the parties and attached to the
public instrument.) (See Art. 1773, Civil Code).

[NOTE: Without the public instrument, the partnership is VOID.

(Art. 1773, Civil Code).]

[NOTE: The inventory is important to show how much is due from

each partner to complete his share in the common fund and how
much is due to each of them in the event of liquidation. (Tablason v.
Bollozos, et al., C.A., 51 O.G. 1966). Without such inventory, the
contract is void. (11 Manresa 278-279 and Art. 1773)].
A partnership was formed orally though more
than P500 was contributed in cash. Now then,
under the last paragraph of Art. 1358, contracts
“where the amount involved exceeds P500 [such
contract] must appear in writing, even a private
one.” Should the oral partnership formed be
considered valid?
FACTS: On Aug. 29, 1952, a partnership was entered
into between Mauricio Agad and Severino Mabato “to operate
a fishpond.” Neither partner contributed a fishpond or a
real right to any fishpond. Their contributions were limited
to the sum of P1,000 each. The partnership contract was in
a public instrument, but an inventory of the fishpond to be
operated was not attached to said instrument.

ISSUE: Is the contract of partnership valid?

Even if not registered, the partnership having a
capital of P3,000 or more is still a valid one, and
therefore has legal personality. (Art. 1768, Civil

(NOTE: Of course if real properties had been

contributed, regardless of value, a public instrument
is needed for the attainment of legal personality.)
If registration is needed or desired, any of the partners
of a valid partnership can compel the others to
execute the needed public instrument, and to
subsequently cause its registration. (Art. 1357, Civil

[NOTE: This right cannot be availed of if the

partnership is void. (Art. 1356 and Art. 1357, Civil