132042249 San Beda Partnership PDF

Preview

Summary

150 2005 CENTRALIZED BAR OPERATIONS2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT CHAIRPERSONS Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC...

Description

150

2005 CENTRALIZED BAR OPERATIONS

PARTNERSHIP PARTNERSHIP 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. (Art. 1767)  A partnership has a juridical personality which is separate and distinct from that of the partners.  A partnership may sue and be sued in its name or by its duly authorized representatives. A managing partner of the partnership may execute all acts of administration including the right to sue debtors of the partnership in the case of their failure to pay their obligation when it becomes demandable. (Tai Tong Chuache & Co. vs. Insurance Commission 158 SCRA 336 [1988])

contract is covered by the statute of frauds and thus requires a written agreement to be enforceable. 3. Where the contract of partnership has a capital of 3,000 pesos or more, in money or property, it shall appear in a public instrument and must be recorded in the Office of the Securities and Exchange Commission. However, a partnership has a juridical personality even in case of failure to comply with this requirement.

FORM OF PARTNERSHIP CONRTRACT No special form is required for the validity or existence of the contract of partnership.

NOTE: With regard to number 2 (legal capacity of contracting parties), individuals not legally incapacitated to contract and partnerships may enter into a contract of partnership. With respect to corporations, the court held in Aurbach vs. Sanitary Wares Manufacturing Corporation 180 SCRA 130 [1989] that although a corporation cannot enter into a partnership contract, it may however engage in a joint venture with others. A joint venture has been generally understood to mean an organization formed for some temporary purpose. There is nothing against one corporation being represented by a natural or juridical person in a suit in court, for the true rule is that “although a corporation has no power to enter a partnership, it may nevertheless enter into a joint venture with another where the nature of that venture is in line with the business authorized by the charter. (JM Tuazon and Co., Inc vs. Bolanos 95 PHIL 106 [1954])

1. Where immovable property or real rights are contributed, the partnership contract shall be void unless: a. It is reduced to writing in a public instrument (Art. 1771). b. An inventory of the property contributed is made, signed by the parties and attached to the public instrument. (Art.1773).  A partnership contract which states that the partnership is established to operate a fishpond is not rendered void because no inventory of the fishpond was made (where it did not clearly appear in the articles of partnership that the real property had been contributed by anyone of the partners). (Agad vs. Mabolo and Mabolo Agad and Co., 23 SCRA 1223[1968]) 2. Where the contract is by its terms not to be performed within a year from the making thereof, such partnership

Requisites: 1. intention to create a partnership 2. common fund obtained from the contributions 3. joint interest in the profits Essential Features: 1. there must be a valid contract; 2. the parties must have legal capacity to enter into the contract;

2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT CHAIRPERSONS Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-EDP), Anna Margarita Eres (VC-Logistics) Jonathan Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law), Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)

San Beda College of Law

151

MEMORY AID IN CIVIL LAW 3. there must be mutual contribution of money, property and industry to a common fund NOTE: A partnership of a civil nature was formed because Gatchalian & Co. put up money to buy a sweepstakes ticket for the sole purpose of dividing equally the prize which they may win as they did in fact in the amount of P50,000. (Gatchalian vs. CIR 67 PHIL 666 [1939]) Where the father sold his rights over 2 parcels of land to his 4 children so they can build their residences, but the latter after 1 year sold them and paid the capital gains, they should not be treated to have formed an unregistered partnership and taxed corporate income tax on the sale and on dividend income tax on their shares of the profits from the sale. (Obillos Jr. vs. CIR [1985]) 4. the object must be lawful; and 5. the primary purpose must be to obtain profits KEY: CJP3 - D2AFT Partnership

Co-ownership

1. Creation Always created by a Generally created by contract, either law, but may exist express or implied even without a contract 2. Juridical personality Has a juridical Has no juridical personality separate personality and distinct from that of each partner 3. Purpose Realization of Common enjoyment profits of a thing or right; does not necessarily involve sharing of profits 4. Duration No limitation upon An agreement to the duration is set keep the thing by law undivided for more than 10 years is not allowed 5. Transfer of interests A partner may not A co-owner can dispose of his dispose of his share individual interest in without the consent the partnership so of the others as to make the

assignee a partner without unanimous consent 6. Power to act with third persons In the absence of A co-owner cannot stipulation to the represent the cocontrary, a partner ownership may bind the partnership 7. Dissolution Death or incapacity Death or incapacity of a partner results of a co-owner does in the dissolution of not necessarily partnership dissolve the coownership 8. Agency or representation As a rule, there is As a rule, there is no mutual agency mutual representation (although it is enough for a coowner to bring an action for ejectment against a stranger) 9. Profits May be stipulated Must always depend upon upon proportionate shares and any stipulation to the contrary is VOID (Art.485) 10. Form May be in any from No public instrument except when real is needed even if property is real property is the contributed (here a object of the copublic instrument is ownership required)

KEY: CNJ – PMERET2 - FPG Partnership Corporation 1. Creation Created by mere Created by law agreement of the or by operation parties of law 2. Number of incorporators May be organized by at Requires at least two persons least five incorporators (except a corporation sole) 3. Commencement of juridical personality Acquires juridical Acquires personality from the juridical moment of execution of personality from the contract of the date of partnership issuance of the certificate of

CIVIL LAW COMMITTEE  CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy Gayon  SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma. Rhodora Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease), John Stephen Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony Purganan(LTD), Ma. Ricasion Tugadi (Conflicts of Law)

2005 CENTRALIZED BAR OPERATIONS

152

incorporation by the Securities and Exchange Commission 4. Powers Partnership may Corporation can exercise any power exercise only authorized by the the powers partners (provided it is expressly not contrary to law, granted by law morals, good customs, or implied from public order, public those granted or policy) incident to its existence 5. Management When management is The power to do not agreed upon, every business and partner is an agent of manage its the partnership affairs is vested in the board of directors or trustees 6. Effect of mismanagement A partner as such can sue a co-partner who mismanages

The suit against a member of the board of directors or trustees who mismanages must be in the name of the corporation

7. Right of succession Partnership has no right of succession

Corporation has right of succession

8. Extent of liability to third persons Partners are liable Stockholders are personally and liable only to subsidiarily (sometimes the extent of solidarily) for the shares partnership debts to subscribed by third persons them 9. Transferability of interest Partner cannot transfer Stockholder has his interest in the generally the partnership so as to right to transfer make the transferee a his shares partner without the without prior unanimous consent of consent of the all the existing partners other because the partnership stockholders is based on the principle because of delectus personarum corporation is not based on this principle

10. Term of existence partnership may be corporation may established for any not be formed period of time for a term in stipulated by the excess of 50 partners years extendible to not more than 50 years in any one instance 11. Firm name limited partnership is corporation may required by law to add adopt any name the word “Ltd.” To its provided it is name not the same as or similar to any registered firm name 12. Dissolution may be dissolved at any can only be time by any or all of the dissolved with partners the consent of the State 13. Governing Law governed by the governed by the contract and the Civil Corporation Code Code

JOINT VENTURE  It is hardly distinguishable from partnership, since their elements are similar, i.e. community of interest in the business, sharing of profits and losses, and a mutual right of control.  The main distinction in common law jurisdiction is that partnership contemplates a general business with some degree of continuity, while joint venture is formed for the execution of a single transaction and is thus of temporary nature  In Kilosbayan, Incorporated vs. Guingona, Jr 232 SCRA 110 [1994], the court defined a joint venture as an association of persons or companies jointly undertaking some commercial enterprise; generally all contribute assets and share risks. Its requisites are: a. A community of interest in the performance of the subject matter; b. A right to direct and govern the policy in connection therewith; c. Duty to share profits and losses.

2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT CHAIRPERSONS Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-EDP), Anna Margarita Eres (VC-Logistics) Jonathan Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law), Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)

San Beda College of Law

153

MEMORY AID IN CIVIL LAW NOTE: Under the Civil Code, a partnership may be particular or universal, and a particular partnership may have for its object a specific undertaking. Hence, a joint venture may be treated like any other contract, innominate in nature to be regulated and governed primarily by the stipulations of the parties thereto and suppletorily by the general provisions of the Civil Code on obligations and contracts, by rules governing the most analogous contracts (e.g. law on partnership), and by the customs of the place. Other Similar Contracts 1. Collaboration- the act of working together in a joint project. 2. Association- act of a number of persons uniting together for some special purpose or business. RULES TO DETERMINE EXISTENCE OF PARTNERSHIP (ART 1769) 1. GENERAL RULE: Persons who are not partners as to each other are not partners as to third persons. EXCEPTION: partnership by estoppel 2. Co-ownership of a property does not itself establish a partnership, even though the co-owners share in the profits derived from the incident of joint ownership. 3. Sharing of gross returns alone does not indicate a partnership, whether or not the persons sharing them have a joint or common right or interest in any property from which the returns are derived. 4. Receipt of share in the profits is a strong presumptive evidence of partnership. However, no such inference will be drawn if such profits were received in payment: (a) as a debt by installments or otherwise; (b) as wages of an employee or rent to a landlord; (c) as an annuity to a widow or representative of a deceased partner; (d) as interest on a loan, though the amount of payment vary with the profits of the business; and

(e) as the consideration for the sale of a goodwill of a business or other property by installments or otherwise. CLASSIFICATION OF PARTNERSHIP 1. as to object: a) universal partnership i. universal partnership of all present property ii. universal partnership profits

of

b) particular partnership 2. as to liability of partners: a) general partnership b) limited partnership 3. as to duration: a) partnership at will b) partnership with period

a

fixed

4. as to legality of existence: a) de jure partnership b) de facto partnership 5. as to representation to others: a) ordinary or real partnership b) ostensible or partnership by estoppel 6. as to publicity: a) secret partnership b) notorious or open partnership 7. as to purpose: a) commercial or trading b) professional or non-trading UNIVERSAL PARTNERSHIP 1. A universal partnership of all present property is one wherein the partners contribute all the property which actually belong to them to a common fund, with the intention of dividing the same among themselves, as well as all the profits which they may acquire therewith.  In a universal partnership of all present property, the property which belongs to each of the partners at the time of the constitution of the partnership, becomes the common property of all the partners, as well as

CIVIL LAW COMMITTEE  CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy Gayon  SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma. Rhodora Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease), John Stephen Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony Purganan(LTD), Ma. Ricasion Tugadi (Conflicts of Law)

154

2005 CENTRALIZED BAR OPERATIONS

the profits which they may acquire therewith. A stipulation for the common enjoyment of any other profits may also be made; but the properties which the partners may acquire subsequently by inheritance, legacy or donation cannot be included in such stipulation, except the fruits thereof.  Where the articles of partnership do not specify the nature of the universal partnership, whether it is one of “present property” or of “profits” only, it will be presumed that the parties intended merely a partnership of profits. NOTE: Future properties cannot be contributed. Thus, property subsequently acquired by (1) inheritance, (2) legacy or (3) donation cannot be included by stipulation except the fruits thereof. 2. A universal partnership of profits is one which comprises all that the partners may acquire by their industry or work during the existence of the partnership and the usufruct of movable or immovable property which each of the partners may posses at the time of the celebration of the contract.  Movable or immovable property which each of the partners may posses at the time of the celebration of the contract shall continue to pertain exclusively to each, only the usufruct passing to the partnership. NOTE: Persons who are prohibited from giving each other any donation or advantage cannot enter into a universal partnership. (Art. 739, Art. 87, Family Code) Profits acquired by their partners through chance (i.e. lottery) without employment of any physical or intellectual efforts are not included. PARTICULAR PARTNERSHIP A particular partnership is one which has for its object determinate things, their use and fruits, or a specific undertaking, or the exercise of a profession or vocation.

GENERAL PARTNERSHIP A partnership consisting of general partners who are liable pro rata and subsidiarily and sometimes solidarily with their separate property for partnership debts. LIMITED PARTNERSHIP One formed by two or more persons having as members one or more general partners and one or more limited partners, the latter not being personally liable for the obligations of the partnership. PARTNERSHIP AT WILL A partnership wherein no time is specified and is not formed for a particular undertaking or venture and which may be terminated at anytime by mutual agreement of the partners, or by the will of anyone partner alone; or one for a fixed term or particular undertaking but has been continued by the partners after termination of such term or particular undertaking without express agreement. PARTNERSHIP WITH A FIXED TERM A partnership wherein the term for which the partnership is to exist is fixed or agreed upon or one formed for a particular undertaking, and upon the expiration of the term or completion or the particular enterprise, the partnership is dissolved, unless continued by the partners. OTHER KINDS OF PARTNERSHIP 1. De Jure Partnership- one which has complied will all the legal requirements for its establishment. 2. De Facto Partnership- one which has failed to comply with all the legal requirements for its establishment. 3. Ordinary or real partnership- one which actually exists among the partners and also as to third persons. 4. Ostensible partnership or partnership de facto- one which in reality is not a partnership, but is considered a partnership only in relation to those who, by their conduct or admission, are precluded to deny or disprove its existence.

2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT CHAIRPERSONS Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-EDP), Anna Margarita Eres (VC-Logistics) Jonathan Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law), Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)

San Beda College of Law

155

MEMORY AID IN CIVIL LAW 5. Secret partnership- one wherein the existence of certain persons as partners is not avowed or made known to the public by any of the partners. 6. Open or notorious partnership- one whose existence is avowed or made known to the public by the members of the firm. 7. Commercial or trading partnershipone formed for the transaction of business. 8. Professional or non-trading partnership- one formed for the exercise of a profession. CLASSIFICATION OF PARTNERS 1. as to CONTRIBUTION: a) Capitalist partner- one who contributes money or property to the common fund. b) Industrial partner- one who contributes only his industry or personal service. 2. as to LIABILITY: a) General partner- one whose liability to third persons extends to his separate property, he may either be a capitalist or industrial partner. b) Limited partner- one whose liability to third persons is limited to his capital contribution. 3. as to MANAGEMENT: a) Managing partner- one who manages the business or affairs of the partnership; he may be appointed in the articles of partnership or after constitution of the partnership. b) Silent partner- one who does not take any active part in the business although he may be know...