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Summary The Law on Partnerships and Private Corporations, ISBN: 9789712382727 Laws on Partnership and Corporation (ACC225)
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Summary of the Business Laws: Laws on Partnership and Corporations
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GANADOS, ANGILICA JOY A.BSA- II
ACC 225- 1184
LAW ON PARTNERSHIP
A. General Provisions
Law on partnership is under Business Laws and Regulations
Stages of Partnership
a. Formation
b. Operation- usually tackles about profit and losses
c. Dissolution- usually tackles about admission and withdrawals
d. Liquidation- usually deals with installment and lump-sump
Partnership- ( Art. 1767)
- Deals with businesses: Two or more persons bind
themselves to contribute money, property, and industry to a
common fund, with the intention of dividing profits among
themselves.
- General Professional Partnership: Two or more persons
may also form a partnership for the exercise of a profession.
Characteristics of Partnership
- Principal : does not depend on any other
contract for its validity
- Bilateral or Multilateral : two or more
persons has reciprocal rights
- Nominate : special name given by law
and has respective rights and obligations
- Preparatory : by which other contracts
will be entered into as the partnership
pursue its business ( e.g contract of sale,
etc.)
- Onerous : partners contribute to a
common fund with the intention of
dividing profits among themselves
, - Consensual : perfected by consent of
the parties ( Art. 1305)
1. Is there a partnership?
1a. Persons who are not partners as to each other are not
partners as to third persons, except:
o Partners by estoppel- in pais ( by statement,
silence, or omission); by deed ( in view of any
document); by laches ( passage of time)
Partners by Estoppel ( Art.1785)
1. When a person represents himself as partner in an
existing partnership (partnership liability will arise):
a. if all partner consent to such misrepresentation- a
partnership by estoppel is created between the actual
partners and the person who made the
misrepresentation
b. if not all partner consent to misrepresentation- the
person who made the misrepresentation is considered
partner by estoppel (shall have all the obligations of
an actual partner but without the rights of a partner); (
jointly with the actual partner who consented the
misrepresentation)
2. When a person represents himself in a non-existing
partnership ( no partnership liability will arise):
a. The person who made the misrepresentation and
all the persons who consented to it are liable
1b. Co-ownership does not by itself establish a partnership (Art.
1769):
o Whether such co-owners do or do not share profits
made by the use of property- for enjoyment and
preservation of the property co-owned ( co-ownership
exists if there is no partition)
1c. The sharing of gross return does not of itself establish 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.
Prima Facie Existence of Partnership
- The receipt by a person of a share of
profits (net returns) of a business is
prima facie that he or she is a partner in
the business, except: (if such payment
were received in payment)
o As debt by installment or otherwise;
o As wages of an employee or rent to a landlord
o As an annuity to a widow or a representative of a
deceased partner
o As an interest on a loan
o As the consideration for the sale of a goodwill of a
business or other property by installment
- If there is a mutual contribution of money,
property, and industry to a common fund
and such person has a receipt of share of
profits, is it considered as conclusive
evidence that a partnership exist? No,
only prima facie.
Purpose of Partnership
- Must be lawful
- In unlawful, partnership will be dissolved
(all profits will be confiscated in favor of
the state without prejudice [provisions
relative to the unlawful partnership or
committed crime] to the revised penal
code); ( Art. 45 proceeds and
instruments and tools of the crime unless
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