IRMA IDOS, petitioner, vs. COURT OF APPEALS and PEOPLE OF THE PHILIPPINES, respondents 2! SCRA "#, Septe$%er 2&, "' Fa(ts) Irma Idos, petitioner, formed a short-lived partnership with Eddie Alarilla, respondent, for a leather tanning business. Upon the business’ liquidation, it had receivables and stocks worth !,"##,###. $or the share of Alarilla, Idos issued four post-dated checks of which onl% three out of four checks were encashed. &his impelled Alarilla to file for a ' (( case against Idos when the latter refused to pa% the value of the check after the former has demanded for for it. it. )n her her defe defens nse, e, Idos Idos clai claime med d that that the the chec check k serv served ed onl% onl% as an *assu *assura ranc nce+ e+ of Alar Alaril illa la’s ’s sh shar are e in the the part partne ners rshi hip p and and that that it was was not not supposed to be deposited until the stocks have been sold. &his was refuted b% Alarilla and subsequentl% Idos was convicted b% the trial court of the offense charged. &he A affirmed the decision of the trial court.
Iss*e) hether or not Idos violated ' ((
He+d) /o. /o. )ne )ne of the the elem elemen ents ts of the the offe offens nse e penal penali0 i0ed ed unde underr ' (( is *the *the making, drawing and issuance of an% check to appl% for an% account or for value.+ In this case Idos showed enough evidence that the check was to be fund funded ed from from rece receiv ivab able les s to be coll collec ecte ted d and and good goods s to be sold sold b% the the part partne ners rshi hip. p. $irs $irst, t, onl% onl% one one of the the four fours s chec check k were were not not enca encash shed ed and second, even Alarilla himself admitted that there was no consideration for the issuance of the check. 1ence the check in question was not issued for an% debt of or an% account due and pa%able b% the petitioner. 2oreover, Idos and Alarilla were still in the *winding up+ of the affairs of the partnership hen the check was issued as evidenced b% the fact that the% still had to sell the goods on hand and collect the receivables from debtors. As provided b% the ivi ivill ode ode33 wind windin ing-u g-up p is the the proc proces ess s of sett settli ling ng busi busine ness ss affai affairs rs afte afterr dissolution, i.e. collecting of assets previousl% demandable4 termination is the point in time after all the partnership affairs have been wound up. &hus, since that partnership has not been terminated, the petitioner and private complainant remained as co-partners. &he check was thus issued b% the
petitioner to complainant as would a partner to another and not as pa%ment from a debtor to a creditor. Idos did not violate ' ((.
ILLAREAL S. RAMIRE-
FACTS) 5ometime in !6"7, 8u0viminda 9illareal, armelito :ose, and :esus :ose formed a partnership with a capital of ;<#,### for the operation of a restaurant and catering services business under the name of *Aquarius $ood 1ouse and atering 5ervoces.+ 9illareal was appointed general manager and armelito :ose, operations manager. =espondent >onaldo Efren =amire0 ?oined as a partner and his capital contribution of (<#,### was paid b% his parents, respondents esar and armelita =amire0. After :esus :ose withdrew from the partnership in :anuar% !6";, his capital contribution of (<#,### was refunded to him in cash b% agreement of the partners. In the same month, without prior knowledge of respondents, petitioners closed the restaurant, allegedl% because of increased rental. &he restaurant furniture and equipment were deposited in the respondent’s house for storage. =espondents wrote petitioners a letter sa%ing that the% were no longer interested in continuing the partnership and that the% were accepting the latter’s offer to return their capital contribution. Again, respondents wrote petitioners informing the deterioration of the restaurant furniture and equipment, and reiterated the request to return their one-third share of the capital contribution. &he repeated oral and written requests were left unheeded. Aggrieved, respondents filed a complaint for collection of sum of mone%.
ISSUE) hether or not petitioners are liable to respondents for the latter’s share in the partnership. HELD) /). =espondents have no right to demand from petitioners the return of their equit% share. E@cept as managers of the partnership, petitioners did not personall% hold its equit% or assets. *&he partnership has a ?uridical personalit% separate and distinct from that of each of the partners.+ 5ince the capital was contributed to the partnership, not to petitioners, it is the partnership that must refund the equit% of the retiring partners. 5ince it is the partnership, as a separate and distinct entit%, that must refund the shares of the partners, the amount to be refunded is necessaril% limited to its total resources. In other words, it can onl% pa% out what it has in its coffers, which consists of all its assets. 1owever, before the partners
can be paid, whatever is left of the partnership assets becomes available for the pa%ment of the partner’s shares. In the present case, the investment of the respondents substantiall% dwindled. &he original amount of (<#,### which the% had invested could no longer be returned to them because onethird of the partnership properties at the time of dissolution did not amount to that much.
U s NLRC 22# SCRA /& 0*ne 1, "1 FACTS) etitioner 'en?amin u was formerl% the Assistant Beneral 2anager of the marble quarr%ing and e@port business operated b% a registered partnership with the firm name of C:ade 2ountain roducts ompan% 8imitedC DC:ade 2ountainC. &he partnership was originall% organi0ed on (" :une !6"7 with 8ea 'endal and =hodora 'endal as general partners and hin 5hian :eng, hen 1o-$u and u hang, as limited partners. &he partnership business consisted of e@ploiting a marble deposit. hen the partnership was sold and transferred to private respondent, he was never retain to his ?ob. 1e filed a complaint for illegal dismissal and recover% of unpaid salaries, moral and e@emplar% damages and attorne%Fs fees, against :ade 2ountain, 2r. ill% o and the other private respondents. &he partnership and ill% o denied petitionerFs charges, contending in the main that 'en?amin u was never hired as an emplo%ee b% the present or new partnership. &he 8abor Arbiter rendered a decision holding that petitioner had been illegall% dismissed. )n appeal, the /ational 8abor =elations ommission reversed the decision of the 8abor Arbiter and dismissed petitionerFs complaint. &he /8= held that a new partnership consisting of 2r. ill% o and 2r. Emmanuel Gapanta had bought the :ade 2ountain business, that the new partnership had not retained petitioner u in his original position as Assistant Beneral 2anager, and that 'en?amin u, therefore, had not been illegall% dismissed b% the new partnership which had simpl% declined to retain him in his former managerial position. I55UE3 hether the partnership which had hired petitioner u as Assistant Beneral 2anager had been e@tinguished and replaced b% a new partnerships composed of ill% o and Emmanuel Gapanta 1E8>3 &he changes in the membership of the partnership was the dissolution of the old partnership. )ccurrence of events which precipitate the legal consequence of dissolution of a partnership don’t automaticall% result in the termination of the legal personalit% of the old partnership. &he legal personalit% of a partnership persists for the limited purpose of winding up and closing of the affairs of the partnership. A withdrawing partner remains liable to a third part% creditor of the old partnership butthe new partnership is entitled to appoint and hire a new general or assistant general manager to run the affairs of the business. Indeed, 'en?amin u is entitled to enforce his
claim for unpaid salaries, as well as other claims relating to his emplo%ment with the previous partnership, against the new :ade 2ountain.
34.R. No. "2/#&. O(to%er #, 25 MAR0ORIE TOCAO and 6ILLIAM T. 7ELO vs. CA and NENITA A. ANA illiam 'elo introduced /enitaAna% to his girlfriend, 2ar?orie &ocao. &he three agreed to form a ?oint venture for the sale of cooking wares. 'elo was to contribute (.< million4 &ocao also contributed some cash and she shall also act as president and general manager4 and Ana% shall be in charge of marketing. 'elo and &ocao specificall% asked Ana% because of her e@perience and connections as a marketer. &he% agreed further that Ana% shall receive the following3 D!!#H share of annual net profits4 D(H overriding commission for weekl% sales4 DJ J#H of sales Ana% will make herself and D7 (H share for her demo services. &he% operated under the name Beminesse Enterprise, this name was, however registered as a sole proprietorship with the 'ureau of >omestic &rade under &ocao. &he ?oint venture agreement was not reduced to writing because Ana% trusted 'elo’s assurances.&he venture succeeded under Ana%’s marketing prowess.'ut then the relationship between Ana% and &ocao soured. )ne da%, &ocao advised one of the branch managers that Ana% was no longer a part of the compan%. Ana% then demanded that the compan% be audited and her shares be given to her. FACTS:
ISSUE) hether or not there was an un?ustified dissolution of partnership that would entitle Ana% to damages. HELD) es.&ocao unilaterall% e@cluded Ana% from the partnership to reap for herself andKor for 'elo financial gains resulting from Ana%’s efforts to make the business venture a success. 1er instructions not to allow Ana%to hold two sales office concretel% spoke of her perception that Ana% was no longer necessar% in the business operation and resulted in a falling out between the two. 1owever, a mere falling out or misunderstanding between partners does not convert the partnership into a sham organi0ation. &he partnership e@ists until dissolved under the law. 5ince the partnership created b% the parties has no fi@ed term and is therefore a partnership at will predicated on their mutual desire and consent, it ma% be dissolved b% the will of a partner.An un?ustified dissolution b% a partner can sub?ect him to action for damages because b% the mutual agenc% that arises in a partnership, the doctrine of delectus personae allows the partners to have the power, although not necessaril% the right to dissolve the partnership./evertheless, the partnership was not terminated thereb%4 it continues until the winding up of the business.
=EA8U'I& vs :A5) $A&53 etitioner :osefina =ealubit entered into a :oint 9enture Agreement with $rancis Eric Amaur% 'iondo, a $rench national, for the operation of an ice manufacturing business, with :osefina as the industrial partner and 'iondo as the capitalist partner. 5ubsequentl%, 'iondo e@ecuted a >eed of AssignmentL without :osefina’s knowledge and consent to the transfer of 'iondo’s shareL transferring all his rights and interests in the business in favor of respondent Eden :aso. ith 'iondoFs eventual departure from the countr%, :aso sent =ealubit a letter apprising her of their acquisition of said 'iondo’s share in the business and formall% demanding an accounting and inventor%, as well as the remittance of their portion of its profits, which =ealubit failed to acquiesce. :aso filed suit against =ealubit, as well as her husband, Ike, for specific performance, accounting, e@amination, audit and inventor% of assets and properties, dissolution of the ?oint venture, appointment of a receiver and damages. &he 5pouses =ealubit claimed that the% have been engaged in the tube ice trading business under a single proprietorship even before their dealings with 'iondo4 that :aso cannot be considered as a partner in the business, pursuant to Article !"!J4 and while entitled to 'iondo’s share in the profits of the business, :aso cannot interfere with the management of the partnership. I55UE3 hether or not there was a valid assignment of rights to the ?oint venture =U8I/B3 :aso is entitled to 'iondoFs share in the profits, despite :osefina’s lack of consent to the assignment of 'iondo’s interest in the ?oint venture. Although :aso did not become a partner as a consequence of the assignment andKor acquire the right to require an accounting of the partnership business, the A correctl% granted her pra%er for dissolution of the ?oint venture conformabl% with the right granted to the purchaser of a partner’s interest under Article !"J! of the ivil ode. A ?oint venture is likened to a particular partnership or one which Chas for its ob?ect determinate things, their use or fruits, or a specific undertaking, or the e@ercise of a profession or vocation.C In Article !"!J, it provides that *the transfer b% a partner of his partnership interest does not make the assignee of such interest a partner of the firm, nor entitle the assignee to interfere in the management of the partnership business or to receive an%thing e@cept the assignorFs profits+.
&he assignment does not purport to transfer an interest in the partnership, but onl% a future contingent right to a portion of the ultimate residue as the assignor ma% become entitled to receive b% virtue of his proportionate interest in the capital. 1E=E$)=E, the petition is >E/IE>.
B.=. /o. 8-<"J; CRISTO7AL 7ONNEIE, ET AL., plaintiffs-appellants, vs. 0AIME HERNANDE-, defendant-appellee. $acts3 laintiffs with other associates formed a s%ndicate or secret partnership for the purpose of acquiring the plants, franchises and other properties of the 2anila Electric o. L hereinafter called the 2eralco. /o formal articles were drawn for it was the purpose of the members to incorporate once the deal had been consummated. /egotiation for the purchase was commenced, but as it made no headwa%, defendant was taken in as a member of the partnership so that he could push the deal through, and to that end he was given the necessar% power of attorne%. Using partnership funds, defendant was able to bu% the 2eralco properties. About the latter half of the following month the members of the partnership proceeded with the formation of the proposed corporation, apportioning among themselves its shares of stock in proportion to their respective contributions to the capital of the partnership and their individual efforts in bringing about the acquisition of the 2eralco properties. 'ut before the incorporation, ?udge =e%es and the plaintiffs withdrew from the partnership for the reason that the business was not going well, and, as admitted b% both parties, the partnership was then dissolved. In accordance with the terms of the resolution, the withdrawing partners $ollowing the dissolution of the partnership, the members who preferred to remain in the business went ahead with the formation of the corporation, taking in new associates as stockholders. &wo %ears from their withdrawal from the partnership, when the corporate business was alread% in a prosperous condition, plaintiffs brought the present suit against :aime 1ernande0, claiming a share in the profit the latter is supposed to have made from the assignment of the 2eralco properties to the corporation, estimated b% plaintiffs to be ((<,### and their share of it to be !!<,J!(.<#. >efendantFs answer denies that he has made an% profit out of the assignment in question and alleges that in an% event plaintiffs, after their withdrawal from the partnership, ceased to have an% further interest in the subsequent transactions of the remaining members.
Issue3 K/ ristobal 'onnevie, the plaintiff, is entitled to profits of the partnership at the time of dissolution. 1eld3 /o liquidation was called for because there was alread% a settlement as to what ristobal 'onnevie should receive. It appeared that the settlement was agreed
upon the ver% da% the partnership was dissolved. &he acceptance b% ristobal 'onnevie of his investment was understood and intended as a final settlement of whatever right or claim ristobal 'onnevie might have in the dissolved partnership. ristobal 'onnevie was precluded from claiming an% share in the profits should there be an%, at the time of dissolution.
4.R. No. L8"/&2!
0*ne 1, "!2
4RE4ORIO MA4DUSA, ET AL., petitioners, vs. 4ERUNDIO AL7ARAN, ET AL., respondents. Appellant and appellees, together with various other persons, had verball% formed a partnership de facto, for the sale of general merchandise to which appellant contributed (,### as capital, and the others contributed their labor, under the condition that out of the net profits of the business, (
Iss*e3 hether or not appelleesF action can be entertained, because in the distribution of all or part of a partnershipFs assets, all the partners have no interest and are indispensable parties without whose intervention no decree of distribution can be validl% entered.
He+d3 It cannot be entertained. A partnerFs share cannot be returned without first dissolving and liquidating the partnership, for the return is dependent on the discharge of the creditors, whose claims en?o% preference over those of the partners4 and it is self-evident that all members of the partnership are interested in his assets and business, and are entitled to be heard in the matter of the firmFs liquidation and the distribution of its propert%. &he liquidation drawn b% appellant is not signed b% the other members of the partnership besides appellees and appellant4 it does not appear that the% have approved, authori0ed, or ratified the same, and, therefore, it is not binding upon them. At the ver% least, the% are entitled to be heard upon its correctness. In addition, unless a proper accounting and liquidation of the partnership affairs is first had, the capital shares of the appellees, as retiring partners, cannot be repaid, for the firmFs outside creditors have preference over the assets of the enterprise, and the firmFs propert% can not be diminished to their pre?udice. $inall%, the appellant cannot be held liable in his personal capacit% for the pa%ment of partnersF shares for he does not hold them e@cept as manager of, or trustee for, the partnership. It is the latter that must refund their shares to the retiring partners. 5ince not all the members of the partnership have been impleaded, no ?udgment for refund can be rendered.
0O C9*n: (an:vs. PACIFIC COMMERCIAL Co.
Fa(ts) In an insolvenc% proceedings of petitioner-establishment, *5ociedad 2ercantil, &eck 5eing Mo., 8td.+, creditors, acific ommercial and others filed a motion with the ourt to declare the individual partner parties to the proceeding, for each to file an inventor%, and for each to be ad?udicated as insolvent debtors.
Iss*e)hat is the nature of the mercantile establishment, &eck 5eing M o., 8td.
He+d) &he contract of partnership established a general partnership. '% process of elimination, &eck 5eing M o., 8td. Isnot a corporation nor an accidental partnership D?ointaccount association. &o establish a limited partnership, there must be, at least, one general partner and the name of at least one of the general partners must appear in the firm name. &his requirement has not been fulfilled. &hose who seek to avail themselves of the protection of laws permitting the creation of limited partnerships must the show a substantiall% full compliance with such laws. It must be noted that all the requirements of the ode have been met wK the sole e@ception of that relating to the composition of the firm name. &he legal intention deducible from the acts of the parties controls in determining the e@istence of a partnership. If the% intend to do a thing wKc in law constitutes a partnership, the% are partners although their ver% purpose was to avoid the creation of such relation. 1ere the intention of the persons making up, &eck 5eing M o., 8td. as to establish partnership wKc the% erroneousl% denominated as a limited partnership.
4.R. No. L82&&12
Fe%r*ar; 2', "!
COMMISSIONER OF INTERNAL REENUE, petitioner, vs. 6ILLIAM 0. SUTER and THE COURT OF TA< APPEALS, respondents. Fa(ts3 A limited partnership, named Cilliam :. 5uter F2orcoinF o., 8td.,C was formed b% herein respondent illiam :. 5uter as the general partner, and :ulia 5pirig and Bustav arlson, as the limited partners. &he limited partnership was registered with the 5ecurities and E@change ommission. 1owever, 5uter and 5pirig got married and, thereafter, limited partner arlson sold his share in the partnership to 5uter and his wife. &he limited partnership had been filing its income ta@ returns as a corporation, without ob?ection b% the herein petitioner, until in !6<6 in an assessment, consolidated the income of the firm and the individual incomes of the partners-spouses 5uter and 5pirig resulting in a determination of a deficienc% income ta@ against respondent 5uter. =espondent 5uter protested the assessment, and requested its cancellation and withdrawal, but his request was denied. 1e appealed to the ourt of &a@ Appeals, which rendered a decision reversing that of the ommissioner of Internal =evenue.
Iss*es3 hether or not the partnership was dissolved after the marriage of the partners, 5uter and 5pirig and the subsequent sale to them b% the remaining partner, Bustav arlson He+d3 /o it did not dissolve the limited partnership. &he capital contributions of partners 5uter and 5pirig were separatel% owned and contributed b% them before their marriage4 and after the% were ?oined in wedlock, such contributions remained their respective separate propert%. &hus, the individual interest of each consort in the limited partnership did not become common propert% of both after their marriage.
