partnership notes chapter2 - jbt

8/18/2019 Partnership Notes Chapter2 - JBT

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LAW ON PARTNERSHIPCivil Code of the Philippines

Arts. 17671!67"#pd$ted notes%

Note& This '$teri$l( )hi*h is $ *o'pil$tion of v$rio#s notes $nd le*t#res( is intendedfor the st#dents of SL+SA,- )ho $re enrolled in L$) A or L$) C to $id the' in their$ppre*i$tion $nd /etter #nderst$ndin0 of the s#/e*t. This is not for s$le.

CHAPTER 2 3 O,LI4ATIONS O5 THE PARTNERSArti*les 17!1!27

RELATIONS CREATE ,8 A CONTRACT O5 PARTNERSHIP

1. Relations among the partners themselves2. Relations of the partners with the partnership3. Relations of the partnership with 3rd persons with whom it contracts4. Relations of the partners with such 3rd persons

Co''en*e'ent of P$rtnership "Art. 17!%&GR: From the moment of the execution of the contractException: nless it is otherwise stipulated

• 7 -A9OR O,LI4ATIONS O5 A PARTNER& "CC+AS%

1. !o give his *ontri/#tion "1#$%& 1#$$'2. (ot to *onvert )rm mone* or propert* for his own use "1#$$'3. (ot to engage in #nf$ir *o'petition with his own )rm "1#$+& 1$,$'4. !o $**o#nt for and hold as trustee unauthori-ed personal pro)ts "1$,#'. /a* for d$'$0es caused 0* his fault "1#+4'%. #t: to *redit to the )rm pa*ment made 0* a de0tor who owes him and the )rm

"1#+2'#. !o sh$re with the other partners the share of the partnership credit which he has

received from an insolvent )rm de0tor "1#+3'

• ; -A9OR RI4HTS O5 A PARTNER& "PAI%

1. Propert: rights "1$1,'a.' Rights in speci)c partnership propert*0.' nterest in the partnership "1$12'c.' Right to participate in the management "1$1,'

2. Right to $sso*i$te with another person in his share "1$,4'3. Right to inspe*t and cop* partnership 0oos "1$,'4. Right to de'$nd a formal account "1$,+'. Right to as for the dissol#tion of the )rm at the proper time "1$3,1$31'

A. O,LI4ATIONS O5 THE PARTNERS A-ON4 THE-SEL


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4. !o preserve said propert* with the diligence of a good father of a famil* pendingdeliver* to partnership. !o inde'nif: partnership for an* damage caused to it 0* the retention of the same or0* the dela* in its contri0ution

E=e*t of 5$il#re to *ontri/#te propert: pro'ised&1. /artners 0ecomes ipso ure a de0tor of the partnership even in the a0sence of an*

demand

2. Remed* of the other partner is not rescission 0ut speci)c performance with damagesfrom defaulting partner

0ligations with respect to *ontri/#tion of 'one: $nd 'one: *onverted to person$l #se"Art. 17!!%

1. !o contri0ute on the date )xed the amount he has undertaen to contri0ute to thepartnership

2. !o reim0urse an* amount he ma* have taen from the partnership co;ers and convertedto his own use3. !o pa* for the agreed or legal interest& if he fails to pa* his contri0ution on time or incase he taes an* amount from the common fund and converts it to his own use4. !o indemnif* the partnership for the damages caused to it 0* dela* in the contri0ution orconversion of an* sum for his personal 0ene)ts

PROHI,ITION A4AINST EN4A4IN4 IN ,+SINESS

(apitalist partner cannotengage in 0usiness "with sameind of 0usiness with thepartnership' for his ownaccount& unless there is astipulation to the contrar*

REAEapitalist partners ma*:1. Exclude him from the )rmC

2. 6vail themselves of the 0ene)ts which hema* have o0tained3. apitalist partner in violationshall:

1. 9ring to common fundan* pro)ts accruing tohim from saidtransaction& and

2. 9ear all losses

0ligations with respect to *ontri/#tion to p$rtnership *$pit$l "6rts. 1#+,1#+1'1. /artners must contri0ute eDual shares to the capital of the partnership unless there isstipulation to contrar*2. /artners "capitalist' must contri0ute additional capital n case of imminent loss to the0usiness of the partnership and there is no stipulation otherwiseC refusal to do so shallcreate an o0ligation on his part to sell his interest to the other partners

Re>#isites&a. !here is an imminent loss of the 0usiness of the partnership0. !he maorit* of the capitalist partners are of the opinion that an additionalcontri0ution to the common fund would save the 0usinessc. !he capitalist partner refuses deli0eratel* to contri0ute "not due to )nancial

ina0ilit*'d. !here is no agreement to the contrar*

5aw36 7 (otes on /artnership 5aw 6tt*. 8onathan 9. !am0ol


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0ligation of '$n$0in0 p$rtners who collects de0t from person who also owed the partnership"6rt. 1#+2'

1. 6ppl* sum collected to 2 credits in proportion to their amounts2. f he received it for the account of partnership& the whole sum shall 0e applied topartnership credit

Re>#isites&a. !here exist at least 2 de0ts& one where the collecting partner is creditor and the

other& where the partnership is the creditor0. 9oth de0ts are demanda0lec. !he partner who collects is authori-ed to manage and actuall* manages the

partnership

0ligation of p$rtner )ho re*eives sh$re of p$rtnership *redit "6rt. 1#+3'1. 0liged to 0ring to the partnership capital what he has received even though he ma*have given receipt for his share onl*

ReDuisites:a. 6 partner has received in whole or in part& his share of the partnership credit0. !he other partners have not collected their sharesc. !he partnership de0tor has 0ecome insolvent

RIS? O5 LOSS O5 THIN4S CONTRI,+TE "Art. 17@;%

=peci)c and determinate things which are not fungi0le where onl* theuse is contri0uted

Ris is 0orne 0* partner

=peci)c and determinate things the ownership of which is transferredto the partnership

Ris is 0orne 0*partnership

Fungi0le things "consuma0le' Ris is 0orne 0*partnership

!hings contri0uted to 0e sold Ris is 0orne 0*partnership

!hings 0rought and appraised in the inventor* Ris is 0orne 0*partnership

R+LES 5OR ISTRI,+TION O5 PRO5ITS AN LOSSES "Art. 17@7%


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partnership

2 or more persons entrustedwith management ofpartnership withoutspeci)cation ofduties@stipulation that eachshall not act w@o the othersconsent

Each ma* execute all acts ofadministration

n case of opposition& decision

of maorit* shall prevailC n

case of tie& decision of partners

owning controlling interest

shall prevail

=tipulated that none of themanaging partners shall actw@o the consent of others

>oncurrence of all necessar*for the validit* of acts

60sence or disa0ilit* of an*one cannot 0e alleged unlessthere is imminent danger ofgrave or irrepara0le inur* tothe partnership

Aanner of management notagreed upon

1. 6ll partners are agentsof the partnership

2. nanimous consentreDuired for alterationof immova0le propert*

f refusal of partner ismanifestl* preudicial tointerest of partnership& courtHsintervention ma* 0e sought

,. PROPERT8 RI4HTS O5 A PARTNER "Se*tion 2%

1. ?is rights in speci)c partnership propert*2. ?is interest in the partnership3. ?is right to participate in the management

(ature of partnerHs right in speci)c partnership propert* "6rt. 1$11'1. EDual right to possession2. Right not assigna0le& not su0ect to attachment or execution& not su0ect to legal support3. Right limited to share of what remains after partnership de0ts have 0een paid

(ature of partnerHs interest in the partnership "6rt. 1$12'1. =hare in the pro)ts and surplus

E=e*ts of *onve:$n*e /: p$rtner of his interest in the p$rtnership "Art. 1!1%&

1. f a partner conve*s his whole interest in the partnership& either of 2 things ma* happen:a.' !he partnership ma* still remain&0.' !he partnership ma* 0e dissolved.

2. !he assignee does not necessaril* 0ecome a partner. !he assignor is still the partner& witha right to demand accounting and settlement.

3. !he assignee cannot even interfere in the management or administration of thepartnership 0usiness or a;airs.

4. !he assignee cannot also demand information& accounting& inspection of the partnership0oos.

Ri0hts of the Assi0nee&1. !o get whatever pro)ts the assignorpartner would have o0tained.2. !o avail himself of the usual remedies in case of fraud in the management.

3. !o as for annulment of the contract of assignment if he was induced to enter into it thruan* of the vices of consent "fraud& error& intimidation& force& undue inIuence' or if hehimself was incapacitated to give consent "minor& insane'.

4. !o demand an accounting "onl* if indeed the partnership is dissolved'.

• Ch$r0in0 Order 7 refers to the remed* availa0le to a udgment creditor of a de0tor

partner to charge the interest of the latter in the partnership 0* means of a court order forthe purpose of satisf*ing the amount of the udgment. 6 receiver of the de0tor partners

5aw36 7 (otes on /artnership 5aw 6tt*. 8onathan 9. !am0ol


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share of the pro)ts ma* even 0e appointed. !his charging order& however& is alwa*ssu0ect to the preferred rights of partnership creditors. "6rt. 1$14'

C. O,LI4ATION O5 PARTNERS WITH RE4AR TO THIR PERSONS "Se*tion %

(ota 9ene "(ote well':

1. Ever* partnership shall operate under a )rm name. /ersons who include their names in thepartnership name even if the* are not mem0ers shall 0e lia0le as a partner. !he continueduse of the name of a deceased partner is permissi0le provided that the )rm indicates in allits communications that said partner is deceased "6rt. 1$1'.

2. 6ll partners "including ndustrial partners' shall 0e lia0le for contractual o0ligations of thepartnership with their propert*& after all partnership assets have 0een exhausted "6rt.1$1%' a. /ro rata 7 0ased on the num0er of partners and not on the amount of their contri0utions0. =u0sidiar*

3. 6dmission or representation made 0* an* partner concerning partnership a;airs within

scope of his authorit* is evidence against the partnership

4. (otice to partner of an* matter relating to partnership a;airs operates as notice topartnership except in case of fraud "6rt. 1$21':a. Jnowledge of partner acting in the particular matter acDuired while a partner0. Jnowledge of the partner acting in the particular matter then present to his mindc. Jnowledge of an* other partner who reasona0l* could and should have communicated itto the acting partner

. /artners and the partnership are solid$ril: li$/le to 3rd persons for the partnerHs tort or0reach of trust "6rt. 1$22'.ReDuisites:a.' 6 partner commits a wrongful act or omissionC0.' ?e is acting in the ordinar* course of the 0usiness of the partnership or with the

authorit* of his copartnersCc.' 5oss or inur* is caused to an* third person.

• !he reDuisites must 0e present to mae the partnership and the other partners solidaril*

lia0le with the acting partner.

%. 5ia0ilit* of incoming partner is limited to "6rt. 1$2%':a. ?is share in the partnership propert* for existing o0ligations0. ?is separate propert* for su0seDuent o0ligations

#. >reditors of partnership preferred in partnership propert* K ma* attach partnerHs share inpartnership assets "6rt. 1$2#'

$. Ever* partner is an agent of the partnership "6rt. 1$1$'.

POWER O5 PARTNER AS A4ENT O5 PARTNERSHIP "Art. 1!1!%

6cts for carr*ing on in the usual wa* the 0usiness of the partnership

Ever* partner is an agent and ma* executeacts with 0inding e;ect even if he has noauthorit*

Except: when 3rd person hasnowledge of lac of authorit*

1. 6ct w@c is not apparentl* for the carr*ing of


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0usiness in the usual wa*2. 6cts of strict dominion or ownership:a. 6ssign partnership propert* in trust for

creditors0.


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!wo nstances:

1.

partnership notes chapter2 - jbt

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