Bus Org - UST
Content
!"#$%&#'()!
!"#$%&#'()!
SS1
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
)5 0-%$#"0$ -. !"#$%&#'()!
"5 1&.)%)$)-%
62 789: ;< =9>:?@><8;=A
"2 A conLracL whereby Lwo or more persons blnd
Lhemselves Lo conLrlbuLe money, properLy, or
lndusLry Lo a common fund, wlLh Lhe lnLenLlon of
dlvldlng Lhe proflLs among Lhemselves.
%B:@: 1wo or more persons may also form a
parLnershlp for Lhe exerclse of a professlon. (Att.
1767, Ncc)
C5 &3&/&%$'
62 789: 9>@ :8@ @<<@?:;9D @D@E@?:< BF 9
=9>:?@><8;=A
"2
1. AgreemenL Lo conLrlbuLe money,
properLy or lndusLry Lo a common fund
(muLual conLrlbuLlon Lo a common
sLock), and
2. lnLenLlon Lo dlvlde Lhe proflLs among
Lhe conLracLlng parLles ([olnL lnLeresL ln
Lhe proflLs). (ívooqellsto v. collectot of
lotetool keveooe, C.k. No. l9996, Oct.
15, 1987).
62 789: 9>@ :8@ >@GH;<;:@< BF 9 =9>:?@><8;=A
"2 )0I
1. )nLenLlon Lo creaLe a parLnershlp
2. 0ommon fund obLalned from
conLrlbuLlons
3. IolnL lnLeresL ln dlvldlng Lhe proflLs (and
losses)
62 789: 9>@ :8@ J89>9J:@>;<:;J< BF 9 =9>:?@><8;=A
"2 C-%00!!
1. !llotetol - lL ls enLered lnLo by Lwo or
more persons and Lhe rlghLs and
obllgaLlons arlslng Lherefrom are
reclprocal
2. "oetoos - each of Lhe parLles asplres Lo
procure for hlmself a beneflL Lhrough
Lhe glvlng of someLhlng
3. #omloote - lL has a speclal name or
deslgnaLlon ln our law
4. $ooseosool - perfecLed by mere
consenL
3. $ommototlve - Lhe underLaklng of each
of Lhe parLners ls consldered as Lhe
equlvalenL of LhaL of Lhe oLhers
6. %tloclpol - lLs llfe does noL depend on
Lhe exlsLence of anoLher conLracL
7. %tepotototy - because lL ls enLered lnLo
as a means Lo an end, l.e. Lo engage ln
buslness
8. &lJocloty - lL ls based on LrusL and
confldence
62 IB<@ @?:@>@K ;?:B 9 L@>M9D 9N>@@E@?: O;:8
.>9?J;<JB :B FB>E 9 =9>:?@><8;= FB> :8@ =H>J89<@
BF J9<JB@< FB> 9 =>B=B<@K MB9: >@?:9D MH<;?@<<5 ):
O9< 9N>@@K :89: .>9?J;<JB OBHDK MHP :8@ J9<JB@<
9?K @9J8 =9>:?@> ;< :B FH>?;<8 <HJ8 9EBH?: BF
EB?@P 9< 8@ JBHDKQ 9?K :89: :8@ =>BF;:< O;DD M@
K;L;K@K =>B=B>:;B?9:@DP5 "F:@> .>9?J;<JB
=H>J89<@K 9 J9<JB O;:8 :8@ EB?@P 9KL9?J@K MP
IB<@Q :8@P H?K@>:BBR :B K>9F: :8@ 9>:;JD@< BF
=9>:?@><8;= 9?K @EMBKP :8@ <9E@ ;? 9?
9H:8@?:;J KBJHE@?:5 (BO@L@>Q :8@P K;K ?B:
JBE@ :B 9? 9N>@@E@?:5 'BQ .>9?J;<JB >@:H>?@K
:8@ EB?@P 9KL9?J@K MP IB<@Q O8;J8 :8@ D9::@>
>@J@;L@K O;:8 9? @S=>@<< >@<@>L9:;B? BF 9DD 8;<
>;N8:< 9< 9 =9>:?@>5
T5 79< :8@>@ 9 =9>:?@><8;= FB>E@K
M@:O@@? IB<@ 9?K .>9?J;<JBA
U5 )F <HJ8 =9>:?@><8;= @S;<:@KQ O9< ;:
:@>E;?9:@K MP :8@ >@J@;=: BF IB<@ BF
:8@ EB?@P 8@ 9KL9?J@KA
"2
1. ?es. 8oLh elemenLs ln a conLracL of
parLnershlp exlsL: a) muLual
conLrlbuLlon Lo a common sLock, and b)
a [olnL lnLeresL ln Lhe proflLs. lf Lhe
conLracL conLalns Lhese Lwo elemenLs, a
parLnershlp relaLlon resulLs, and Lhe law
lLself flxes Lhe lncldenLs of Lhls relaLlon
lf Lhe parLles fall Lo do so. ln Lhls case,
Lhere was money furnlshed by !ose and
recelved by lranclsco for Lhe purchase
of Lhe cascoes and Lhere was also an
lnLenLlon Lo dlvlde Lhe proflLs
proporLlonaLely beLween Lhem. 1hus,
Lhere ls a parLnershlp by vlrLue of Lhe
verbal agreemenL beLween !ose and
lranclsco.
2. no. 1here was no clear lnLenL on Lhe
parL of !ose, ln accepLlng Lhe money, Lo
rellnqulsh hls rlghLs as a parLner.
(letoooJez v. uelo koso, C.k. No. 41J,
leb. 2, 190J)
62 08;E O9< :8@ BO?@> 9?K E9?9N@> BF 9
DHEM@> P9>K5 +;J@?:@ 9?K $;?N =9>:;J;=9:@K ;? :8@
=>BF;:< 9?K DB<<@<5 " JB?:>9J: BF <9O;?N DHEM@>
O9< @?:@>@K ;?:B MP 08;EQ 9J:;?N ;? 8;< BO?
?9E@Q O;:8 .>9?R5 ": :8@ :;E@ :8@ JB?:>9J: O9<
+'$ ,-./&% %-$&' 0122
E9K@Q :8@P O@>@ :8@ VB;?: =>B=>;@:B>< 9?K
B=@>9:B>< BF :8@ <9;K DHEM@> P9>K @?N9N@K ;? :8@
=H>J89<@ 9?K <9D@ BF DHEM@> H?K@> :8@ ?9E@
9?K <:PD@ BF 08;E. )? 9? 9J:;B? :B >@JBL@> :8@
M9D9?J@ H?K@> :8@ JB?:>9J: F;D@K MP .>9?R 9N9;?<:
08;EQ +;J@?:@ 9?K $;?NQ :8@ D9::@> :OB 9DD@N@K
:89: :8@P 9>@ ?B: 08;EW< =9>:?@><5 1;K 08;EQ
+;J@?:@ 9?K $;?N FB>E 9 =9>:?@><8;=A
"2 no. A slmple buslness was formed by Chlm
excluslvely ln hls own name and under hls
personal managemenL and he effecLed every
LransacLlon ln hls name and ln Lhe names of oLher
persons lnLeresLed ln Lhe proflLs and losses of Lhe
buslness. WhaL has been formed ls an accldenLal
parLnershlp of coeotos eo pottlclpocloo.
%B:@2 under Lhe Code of Commerce, coeotos eo
pottlclpocloo means a sorL of an accldenLal
parLnershlp consLlLuLed ln such a manner LhaL lLs
exlsLence was only known Lo Lhose who had an
lnLeresL ln Lhe same, Lhere belng no muLual
agreemenL beLween Lhe parLners, and wlLhouL a
corporaLe name lndlcaLlng Lo Lhe publlc ln some way
LhaL Lhere were oLher people besldes Lhe one who
osLenslbly managed and conducLed Lhe buslness,
governed under arLlcle 239 of Lhe Code of
Commerce. (8ootos v. cotmoo, C.k. No. l2880, uec.
4, 1906)
)%$&%$ $- 0#&"$& " !"#$%&#'()!
62 (@?>P 9?K 3PB?< 9>@ @?N9N@K ;? >@9D @<:9:@
MH<;?@<< 9?K 9>@ JBBO?@>< BF 9 =9>J@D BF D9?K5
(@?>PQ O;:8 :8@ JB?<@?: BF 3PB?<Q EB>:N9N@K :8@
=>B=@>:P :B >9;<@ :8@ FH?K< <HFF;J;@?: :B MHP 9?K
K@L@DB= :8@ '9? IH9? &<:9:@5 3PB?< @S=>@<<@K 8;<
K@<;>@ ?B: :B M@ =9>: BF :8@ K@L@DB=E@?:
=>BV@J:Q MH: (@?>PQ ?@L@>:8@D@<<Q =H><H@K :8@
MH<;?@<< 9DB?@5 78@? :8@ MH<;?@<< =>B<=@>@KQ
3PB?< K@E9?K@K FB> 9 <89>@ ;? :8@ MH<;?@<<5 )<
3PB?< @?:;:D@K :B :8@ <89>@< ;? '9? IH9? &<:9:@A
"2 no. Lyons hlmself manlfesLed hls deslre noL Lo
be parL of Lhe developmenL pro[ecL. 1hus, no
parLnershlp was formed. 1he morLgage of Lhe
land was lmmaLerlal Lo Lhe exlsLence of Lhe
parLnershlp. lL ls clear LhaL Penry, ln buylng Lhe
San !uan LsLaLe, was noL acLlng for any
parLnershlp composed of hlmself and Lyons, and
Lhe law cannoL be dlsLorLed lnLo a proposlLlon
whlch would make Lyons a parLlclpanL ln Lhls deal
conLrary Lo hls express deLermlnaLlon. (lyoos v.
koseostock, C.k. No. J5469, Mot. 17, 19J2)
SS2
62 09:9D;?B 9?K 0@F@>;?B 9JGH;>@K 9 VB;?:
:@?9?JP BL@> 9 =9>J@D BF D9?K H?K@> 9 L@>M9D
JB?:>9J: BF =9>:?@><8;=5 ): O9< <:;=HD9:@K :89:
@9J8 BF :8@ <9;K =H>J89<@>< <8BHDK =9P B?@89DF
BF :8@ =>;J@ 9?K :89: 9? @GH9D K;L;<;B? <8BHDK M@
E9K@ M@:O@@? :8@E BF :8@ D9?K :8H< =H>J89<@K5
1@<=;:@ 09:9D;?BW< K@E9?K FB> 9? @GH9D K;L;<;B?
M@:O@@? :8@EQ 0@F@>;?B >@FH<@K :B KB <B 9?K
@L@? =>BF;:@K F>BE :8@ F>H;:< BF :8@ D9?K5 ">@
:8@P =9>:?@>< B> JBBO?@><A
"2 1hey are coowners because lL does noL appear
LhaL Lhey enLered lnLo any conLracL of parLnershlp
buL only for Lhe sole LransacLlon of acqulrlng
[olnLly or by muLual agreemenL of Lhe land under
Lhe condlLlon LhaL Lhey would pay x of Lhe prlce
of Lhe land and LhaL lL be dlvlded equally beLween
Lhem. (Collemlt v. 1obllltoo, C.k. No. 58J7, 5ept.
15, 1911)
0-//-% .*%1
62 /9P 9 =9>:?@><8;= M@ FB>E@K @L@? ;F :8@
JBEEB? FH?K ;< JBE=>;<@K @?:;>@DP BF MB>>BO@K
B> DB9?@K EB?@PA 789: OBHDK M@ :8@ D;9M;D;:P BF
:8@ =9>:?@>< ;? <HJ8 9 J9<@A
"2 ?es. A parLnershlp may be deemed Lo exlsL
among parLles who agree Lo borrow money Lo
pursue a buslness and Lo dlvlde Lhe proflLs or
losses LhaL may arlse Lherefrom, even lf lL ls
shown LhaL Lhey have noL conLrlbuLed any caplLal
of Lhelr own Lo a "common fund." 1helr
conLrlbuLlon may be ln Lhe form of credlL or
lndusLry, noL necessarlly cash or flxed asseLs.
8elng parLners, Lhey are all llable for debLs
lncurred by or on behalf of Lhe parLnershlp. (llm
1ooq llm v. lblllpploe llsbloq Ceot loJosttles,
loc., C.k. No. 1J6448, Nov. J, 1999)
'("#& )% !#-.)$' "%1 3-''&'
62 /9>;9?B 9?K )<9M@DB @?:@>@K ;?:B 9
=9>:?@><8;= 9N>@@E@?: O8@>@;? :8@P 9>@ :B
JB?:>;MH:@ !TXQYYY @9J8 FB> :8@ =H>=B<@ BF
=>;?:;?N ZXQYYY =B<:@><5 )<9M@DB O9< H?9MD@ :B
=>;?: @?BHN8 =B<:@>< =H><H9?: :B :8@ 9N>@@E@?:Q
:8H< 8@ @S@JH:@K ;? F9LB> BF /9>;9?B 9
=>BE;<<B>P ?B:@ ;? 9? 9EBH?: @GH;L9D@?: :B :8@
H?>@9D;[@K =>BF;: KH@ :B ;?<HFF;J;@?: =>;?:;?N5 $8@
O8BD@ 9EBH?: M@J9E@ KH@ MH: )<9M@DB
K@F9HD:@K =9PE@?:5 )< /9>;9?B @?:;:D@K :B F;D@ 9
J9<@ FB> :8@ >@JBL@>P BF :8@ H?>@9D;[@K =>BF;: BF
:8@ =9>:?@><8;=A
"2 no. 1he essence of a parLnershlp ls Lo share ln
Lhe proflLs and losses, Lhus, Marlano should
shoulder Lhe losses wlLh lsabelo. (Motoo It., v. cA,
C.k. No. l59956, Oct. J1, 1984)
62 $B FB>E 9 D@?K;?N MH<;?@<<Q ;: O9< L@>M9DDP
9N>@@K :89: %BP?BP OBHDK 9J: 9< F;?9?J;@> O8;D@
0B>P 9?K \>;< OBHDK :9R@ J89>N@ BF <BD;J;:9:;B? BF
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
!"#$%&#'()!
E@EM@>< 9?K JBDD@J:;B? BF DB9? =9PE@?:<5 $8@P
9N>@@K :89: %BP?BP OBHDK >@J@;L@ ]Y^ BF :8@
=>BF;:< O8;D@ 0B>P 9?K \>;< OBHDK @9>? TX^ @9J85
$8@ =9>:;@< @S@JH:@K :8@ _">:;JD@< BF "N>@@E@?:_
O8;J8 FB>E9D;[@K :8@;> @9>D;@> L@>M9D 9N>@@E@?:5
39:@>Q %BP?BP F;D@K 9 JBE=D9;?: 9N9;?<: 0B>P 9?K
\>;< FB> E;<9==>B=>;9:;B? BF FH?K< 9DD@N@KDP ;?
:8@;> J9=9J;:;@< 9< %BP?BPW< @E=DBP@@<5 )? :8@;>
9?<O@>Q 0B>P 9?K \>;< 9<<@>:@K :89: :8@P O@>@
=9>:?@>< 9?K ?B: E@>@ @E=DBP@@< BF %BP?BP5
789: R;?K BF >@D9:;B?<8;= @S;<:@K M@:O@@? :8@
=9>:;@<A
"2 A parLnershlp was formed among Lhe parLles.
1he "ArLlcles of AgreemenL" sLlpulaLed LhaL Lhe
slgnaLorles shall share Lhe proflLs of Lhe buslness
ln a 701313 manner, wlLh noynoy geLLlng Lhe
llon's share. 1hls sLlpulaLlon clearly proved Lhe
esLabllshmenL of a parLnershlp. (5ootos v. 5pooses
keyes, C.k. No.1J581J, Oct. 25, 2001)
SSS
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
62 IB<@ JB?L@P@K 8;< DB:< ;? F9LB> BF 8;< FBH> <B?<
;? B>K@> FB> :8@E :B MH;DK :8@;> >@<;K@?J@<5 (;<
<B?< <BDK :8@ DB:< <;?J@ :8@P FBH?K :8@ DB:<
;E=>9J:;J9D FB> >@<;K@?:;9D =H>=B<@< M@J9H<@ BF
8;N8 JB<:< BF JB?<:>HJ:;B?5 $8@P K@>;L@K =>BF;:<
F>BE :8@ <9D@ 9?K =9;K ;?JBE@ :9S5 $8@ <B?<
O@>@ >@GH;>@K :B =9P JB>=B>9:@ ;?JBE@ :9S 9?K
;?JBE@ :9S K@F;J;@?JPQ B? :8@ :8@B>P :89: :8@P
FB>E@K 9? H?>@N;<:@>@K =9>:?@><8;= B> VB;?:
L@?:H>@ :9S9MD@ 9< 9 JB>=B>9:;B?5 1;K :8@ <;MD;?N<
FB>E 9 =9>:?@><8;=A
"2 no. 1he orlglnal purpose was Lo dlvlde Lhe loLs
for resldenLlal purposes. lf laLer, Lhey found ouL
LhaL lL ls noL feaslble Lo bulld Lhelr resldences on
Lhe loLs, Lhey can dlssolve Lhe coownershlp by
reselllng sald loLs. 1he Jlvlsloo oo tbe ptoflt wos
metely loclJeotol to tbe Jlssolotloo of tbe co
owoetsblp whlch was ln Lhe naLure of Lhlngs a
Lemporary sLaLe. (Oblllos, It. v. clk, C.k. No. l
68118, Oct. 29, 1985)
05 #*3&' $- 1&$&#/)%& &`)'$&%0&
62 789: 9>@ :8@ >HD@< :B K@:@>E;?@ :8@ @S;<:@?J@
BF =9>:?@><8;=A
"2
1. Þersons who are noL parLners as Lo each
oLher are noL parLners as Lo Lhlrd
persons.
2. Coownershlp/copossesslon does noL
of lLself esLabllsh a parLnershlp.
3. Sharlng of gross reLurns does noL of
lLself esLabllsh a parLnershlp.
4. 8ecelpL of a person of a share ln Lhe
proflLs ls a prlma facle evldence LhaL he
ls a parLner, bot oot wbeo tecelveJ os
poymeot fot .
a. uebL as lnsLallmenL
b. Wages
c. AnnulLy
d. lnLeresL ln a loan
e. ConslderaLlon for Lhe sale of a
goodwlll
%B:@: ln subparagraphs a - e, Lhe proflLs ln Lhe
buslness are noL shared as proflLs of a parLner as a
parLner, buL ln some oLher respecLs or for some
oLher purpose.
62 1;<:;?NH;<8 =9>:?@><8;= F>BE JB
BO?@><8;=aJB=B<<@<<;B?5
"2
!"#$%&#'()!
0--7%&#'()!a
0-!-''&'')-%
loteot to Jetlve ptoflts
1he proflLs musL be
derlved from Lhe
operaLlon of Lhe
buslness or underLaklng
by Lhe members of Lhe
assoclaLlon and noL
merely from properLy
ownershlp.
$8@ JBBO?@>< <89>@ ;?
:8@ =>BF;:< K@>;L@K
;?J;K@?: :B :8@ VB;?:
BO?@><8;=5
íxlsteoce of flJocloty telotloosblp
1here ls a well deflned
flduclary relaLlonshlp
beLween Lhem as
parLners.
$8@>@ ;< ?B F;KHJ;9>P
>@D9:;B?<8;= M@:O@@?
:8@ =9>:;@<5
kemeJy fot Jlspote
1he remedy for a dlspuLe
or dlfference beLween
Lhem would be an acLlon
for dlssoluLlon,
LermlnaLlon, and
accounLlng.
$8@ >@E@KP OBHDK M@
9? 9J:;B?Q 9< FB>
;?<:9?J@Q FB> ?B?
=@>FB>E9?J@ BF 9
JB?:>9J:5
loteot
1here musL be an
unmlsLakable lnLenLlon
Lo form a parLnershlp.
$8@>@ ;< ?B ;?:@?: :B
FB>E 9 =9>:?@><8;=5
62 " 9?K C 9>@ JBBO?@>< BF 9? ;?8@>;:@K
=>B=@>:;@<5 $8@P 9N>@@K :B H<@ :8@ <9;K JBEEB?
=>B=@>:;@< 9?K :8@ ;?JBE@ K@>;L@K :8@>@F>BE 9<
9 JBEEB? FH?K O;:8 :8@ ;?:@?:;B? :B =>BKHJ@
=>BF;:< FB> :8@E ;? =>B=B>:;B? :B :8@;> >@<=@J:;L@
<89>@< ;? :8@ ;?8@>;:9?J@ 9< K@:@>E;?@K ;? 9
=>BV@J: BF =9>:;:;B?5 789: ;< :8@ @FF@J: BF <HJ8
9N>@@E@?: B? :8@ @S;<:;?N JBBO?@><8;=A
"2 1he coownershlp ls auLomaLlcally converLed
lnLo a parLnershlp. lrom Lhe momenL of parLlLlon,
A and 8, as helrs, are enLlLled already Lo Lhelr
respecLlve deflnlLe shares of Lhe esLaLe and Lhe
lncome Lhereof, for each of Lhem Lo manage and
+'$ ,-./&% %-$&' 0122
dlspose of as excluslvely hls own wlLhouL Lhe
lnLervenLlon of Lhe oLher helrs, and, accordlngly,
he becomes llable lndlvldually for all Lhe Laxes ln
connecLlon LherewlLh.
lf, afLer such parLlLlon, an helr allows hls shares Lo
be held ln common wlLh hls cohelrs under a
slngle managemenL Lo be used wlLh Lhe lnLenL of
maklng proflL Lhereby ln proporLlon Lo hls share,
Lhere can be no doubL LhaL, even lf no documenL
or lnsLrumenL were execuLed for Lhe purpose, for
Lax purposes, aL leasL, an unreglsLered
parLnershlp ls formed. (Ooo v. commlsslooet of
lotetool teveooe, 45 5ckA 74 j1972])
62 789: 9>@ :8@ :P=;J9D ;?J;K@?:< BF =9>:?@><8;=A
"2
1. 1he parLners share ln proflLs and losses.
(Atts. 1767,179798)
2. 1hey have equal rlghLs ln Lhe
managemenL and conducL of Lhe
parLnershlp buslness. (Att. 180J)
SS4
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
3. Lvery parLner ls an agenL of
parLnershlp, and enLlLled Lo blnd Lhe
oLher parLners by hls acLs, for Lhe
purpose of lLs buslness. (Att. 1818)
4. All parLners are personally llable for Lhe
debLs of Lhe parLnershlp wlLh Lhelr
separaLe properLy (Atts. 1816, 182224)
excepL llmlLed parLners.
3. A flduclary relaLlonshlp exlsLs beLween
Lhe parLners. (Att. 1807)
6. Cn dlssoluLlon, Lhe parLnershlp ls noL
LermlnaLed, buL conLlnues unLll Lhe
wlndlng up of parLnershlp ls compleLed.
(Att 1828)
62 789: 9>@ :8@ >HD@< >@N9>K;?N K;<:>;MH:;B? BF
=>BF;:< 9?K DB<<@<A
"2
1. ulsttlbotloo of ptoflts
a. 1he parLners share ln Lhe proflLs
accordlng Lo Lhelr agreemenL
b. ln Lhe absence of such:
l. CaplLallsL parLner - ln
proporLlon Lo hls conLrlbuLlon
ll. lndusLrlal parLner - whaL ls
[usL and equlLable under Lhe
clrcumsLances
2. ulsttlbotloo of losses
a. 1he parLners share ln Lhe losses
accordlng Lo Lhelr agreemenL
b. ln Lhe absence of such, accordlng
Lo Lhelr agreemenL as Lo proflLs
c. ln Lhe absence of proflL
agreemenL, ln proporLlon Lo hls
caplLal conLrlbuLlon
62 789: ;< :8@ >HD@ >@N9>K;?N 9 <:;=HD9:;B? O8;J8
@SJDHK@< 9 =9>:?@> ;? :8@ <89>;?N BF =>BF;:< 9?K
DB<<@<A
"2
4#2 SLlpulaLlon ls volJ.
`!%2 lndusLrlal parLner ls noL llable for losses
jAtt. 1797(2), Ncc]. nowevet, he ls noL
exempLed from llablllLy lnsofar as Lhlrd
persons are concerned.
%B:@: Loss ls dlfferenL from llablllLy
lf, besldes hls servlces Lhe lndusLrlal parLner has
conLrlbuLed caplLal, he shall also recelve a share
ln Lhe proflLs ln proporLlon Lo hls caplLal.
15 (-7 !"#$%&#'()! )' .-#/&1
62 (BO 9>@ =9>:?@><8;=< FB>E@KA
"2 lL ls creaLed by agreemenL of Lhe parLles
(consensual).
%B:@2 1here ls no such Lhlng as a parLnershlp
creaLed by law or by operaLlon or lmpllcaLlon of
law alone. (ue leoo, commeots ooJ coses oo
lottoetsblp, Aqeocy ooJ 1tost, p. 1J, 2005 eJ.
62 789: 9>@ :8@ FB>E9D;:;@< ?@@K@K FB> :8@
J>@9:;B? BF 9 =9>:?@><8;=A
"2
4#2 no speclal form ls requlred for lLs valldlLy
or exlsLence. (Att. 1771, Ncc)
`!%2 lf properLy or real rlghLs have been
conLrlbuLed Lo Lhe parLnershlp:
1. letsoool ptopetty
a. Less Lhan Þ3,000 - moy be oral
b. Þ 3,000 or more - most be.
i. ln a publlc lnsLrumenL, and
ii. reglsLered wlLh SLC (Att.
1772, Ncc)
%B:@2 Lven lf Lhe parLnershlp
ls noL reglsLered wlLh SLC, Lhe
parLnershlp ls sLlll valld and
possesses a dlsLlncL
personallLy (lotos, clvll coJe
of tbe lblllpploes AooototeJ,
volome 5, p. 412, 1969 6
tb
eJ)
2. keol ptopetty ot teol tlqbts - most be.
!"#$%&#'()!
a. ln a publlc lnsLrumenL (Att. 1771,
Ncc)
b. wlLh an lnvenLory of sald properLy
l. slgned by Lhe parLles
ll. aLLached Lo Lhe publlc
lnsLrumenL (Att. 177J, Ncc)
%B:@2 LveryLhlng musL be
complled wlLh, oLherwlse,
parLnershlp ls vold and has no
[urldlcal personallLy even as
beLween Lhe parLles (Att.
177J, Ncc)
lll. reglsLered ln Lhe 8eglsLry of
ÞroperLy of Lhe provlnce,
where Lhe real properLy ls
found Lo blnd Lhlrd persons
(lotos, p. 412)
3. llmlteJ pottoetsblp - musL be
reglsLered as such wlLh SLC, oLherwlse,
lL ls noL valld as a llmlLed parLnershlp
buL may sLlll be consldered a general
parLnershlp wlLh [urldlcal personallLy
(lotos, clvll coJe of tbe lblllpploes
AooototeJ, volome 5, p. 412, 1969 6
tb
eJ)
62 )F :8@ >@GH;>@E@?:< H?K@> ">:5 T]]bQ 9<
>@N9>K< JB?:>;MH:;B? BF >@9D =>B=@>:P :B 9
=9>:?@><8;=Q 89< ?B: M@@? JBE=D;@K O;:8Q O89: ;<
:8@ <:9:H< BF :8@ =9>:?@><8;=A
"2 lL ls vold. noneLheless, a vold parLnershlp
under ArL. 1773, ln relaLlon Lo ArL. 1771 nCC, may
sLlll be consldered by Lhe courLs as an ordlnary
conLracL as regards Lhe parLles LhereLo from
whlch rlghLs and obllgaLlons Lo each oLher may be
lnferred and enforced. (1ottes v. cA, C.k. No.
1J4559, uec. 9 1999)
%B:@2 1ottes v. cA does noL lnvolve Lhlrd persons.
62 789: EH<: M@ KB?@ ;? B>K@> :89: :8@
=9>:?@><8;= E9P M@ @FF@J:;L@ 9< 9N9;?<: :8;>K
=@><B?< O8@?@L@> ;EEBL9MD@ =>B=@>:P ;<
JB?:>;MH:@KA
SSS
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
"2 1o be effecLlve agalnsL 3
rd
parLles, parLnershlp
musL be reglsLered ln Lhe 8eglsLry of ÞroperLy of
Lhe provlnce where Lhe real properLy conLrlbuLed
ls locaLed. (Att. 1771, Ncc)
62 09? :8@>@ M@ 9 =9>:?@><8;= M9<@K B? 9 L@>M9D
9N>@@E@?:Q 9?K O;:8BH: <HJ8 9N>@@E@?: M@;?N
>@N;<:@>@K O;:8 '&0A
"2 ?es. Attlcle 1772 Ncc requlres LhaL
parLnershlps wlLh a caplLal of Þ3,000 or more
musL reglsLer wlLh SLC. Powever, Lhls reglsLraLlon
requlremenL ls noL mandaLory. Attlcle 1768 Ncc
expllclLly provldes LhaL Lhe parLnershlp reLalns lLs
[urldlcal personallLy even lf lL falls Lo reglsLer. 1he
fallure Lo reglsLer Lhe conLracL of parLnershlp
does noL lnvalldaLe Lhe same as among Lhe
parLners, so long as Lhe conLracL has Lhe essenLlal
requlslLes, because Lhe maln purpose of
reglsLraLlon ls Lo glve noLlce Lo Lhlrd parLles, and lL
can be assumed LhaL Lhe members Lhemselves
knew of Lhe conLenLs of Lhelr conLracL. non
compllance wlLh Lhls dlrecLory provlslon of Lhe
law wlll noL lnvalldaLe Lhe parLnershlp.
A parLnershlp may be consLlLuLed ln any form,
excepL where lmmovable properLy of real rlghLs
are conLrlbuLed LhereLo, ln whlch case a publlc
lnsLrumenL shall be necessary. Pence, based on
Lhe lnLenLlon of Lhe parLles, a verbal conLracL of
parLnershlp may arlse. (5ooqocboo v. cboo, C.k.
No. 14JJ40, Aoq. 15, 2001)
%B:@2 8eglsLraLlon ls merely for admlnlsLraLlon and
llcenslng purposes, hence, lL shall noL affecL Lhe
llablllLy of Lhe parLnershlp and Lhe members Lhereof
Lo Lhlrd persons. jAtt. 1772, (2), Ncc]
62 " =9>:?@><8;= O9< @?:@>@K ;?:B M@:O@@?
/9H>;J;B 9?K '@L@>;?B :B B=@>9:@ 9 F;<8=B?K5
%@;:8@> =9>:?@> JB?:>;MH:@K 9 F;<8=B?K B> 9 >@9D
>;N8: BL@> 9?P F;<8 =B?K5 $8@;> J9=;:9D
JB?:>;MH:;B?< O@>@ ;? J9<8 ;? :8@ 9EBH?: BF
!TQYYY @9J85 78;D@ :8@ =9>:?@><8;= JB?:>9J: O9<
KB?@ ;? 9 =HMD;J ;?<:>HE@?:Q ?B ;?L@?:B>P BF :8@
F;<8=B?K :B M@ B=@>9:@K O9< 9::9J8@K ;? :8@ <9;K
;?<:>HE@?:5 )< :8@>@ 9 L9D;K JB?:>9J: BF
=9>:?@><8;=A
"2 ?es. 1here ls a valld conLracL of parLnershlp
desplLe Lhe lack of lnvenLory. 1he purpose of Lhe
parLnershlp was noL Lo engage ln Lhe flshpond
buslness buL Lo operaLe a flshpond. nelLher sald
flshpond nor a real rlghL Lo any flsh pond was
conLrlbuLed Lo Lhe parLnershlp or become parL of
Lhe caplLal Lhereof. (AqoJ v. Moboto, C.k. No. l
2419J, Iooe 28, 1968)
&5 !"#$%&#'()! $&#/
62 789: ;< 9 =9>:?@><8;= O;:8 9 F;S@K :@>EA
"2 lL ls one ln whlch Lhe Lerm of lLs exlsLence has
been agreed upon by Lhe parLners elLher:
1. íxptessly - Lhere ls a deflnlLe perlod
2. lmplleJly - a parLlcular enLerprlse or
LransacLlon ls underLaken
%B:@2 1he mere expecLaLlon LhaL Lhe buslness would
be successful and LhaL Lhe parLners would be able Lo
+'$ ,-./&% %-$&' 0122
recoup Lhelr lnvesLmenL ls noL sufflclenL Lo creaLe a
parLnershlp for a Lerm.
62 09? :8@ =9>:?@>< F;S 9?P :@>E ;? :8@
=9>:?@><8;= JB?:>9J:A
"2 ?es. 1he parLners shall be bound Lo remaln
under such relaLlon for Lhe duraLlon of Lhe Lerm.
62 789: ;< :8@ @FF@J: O8@? :8@ F;S@K :@>E 89<
@S=;>@KA
"2 1he explraLlon of Lhe Lerm flxed or Lhe
accompllshmenL of Lhe parLlcular underLaklng
speclfled wlll cause Lhe auLomaLlc dlssoluLlon of
Lhe parLnershlp.
62 78@? KB@< 9 =9>:?@><8;= JBEE@?J@ :B @S;<:A
"2 A parLnershlp commences from Lhe Llme of
execuLlon of Lhe conLracL lf Lhere ls no conLrary
sLlpulaLlon as Lo Lhe daLe of effecLlvlLy of Lhe
same.
%-$&2 8eglsLraLlon Lo SLC ls noL essenLlal Lo glve lL
[urldlcal personallLy.
1here ls no Llme llmlL prescrlbed by law for Lhe
llfe of a parLnershlp.
62 789: ;< 9 FH:H>@ =9>:?@><8;=A
"2 lL ls a klnd of parLnershlp where Lhe parLners
may sLlpulaLe some oLher daLe for Lhe
commencemenL of Lhe parLnershlp. Þersons who
enLer lnLo a fuLure parLnershlp do noL become
parLners unLll or unless Lhe agreed Llme has
arrlved or Lhe conLlngency has happened.
%-$&2 lL ls a parLnershlp creaLed by lmplled
agreemenL, Lhe conLlnued exlsLence of whlch wlll
depend upon Lhe muLual deslre and consenL of Lhe
parLners.
62 78@? ;< 9 =9>:?@><8;= 9: O;DD :@>E;?9:@A
"2 lL may be lawfully LermlnaLed aL any Llme by
Lhe express wlll of all Lhe parLners or any of Lhem.
62 (BO ;< 9 =9>:?@><8;= 9: O;DD K;<<BDL@KA
"2 Any one of Lhe parLners may dlcLaLe a
dlssoluLlon of a parLnershlp aL wlll.
SS6
%B:@: 1he parLner who wanLs Lhe parLnershlp
dlssolved musL do so ln good falLh, noL LhaL Lhe
aLLendance of bad falLh can prevenL Lhe dlssoluLlon
of Lhe parLnershlp, buL Lo avold Lhe llablllLy for
damages Lo oLher parLners.
03"'').)0"$)-%' -. !"#$%&#'()!
62 ':9:@ :8@ JD9<<;F;J9:;B?< BF =9>:?@><8;=5
"2 As Lo:
1. Object
a. unlversal parLnershlp
l. of all presenL properLy (Att.
1778, Ncc) - comprlses Lhe
followlng:
properLy whlch belonged
Lo each of Lhe parLners aL
Lhe Llme of Lhe
consLlLuLlon of Lhe
parLnershlp
proflLs whlch Lhey may
acqulre from all properLy
conLrlbuLed
ll. of all proflLs (Att. 1780, Ncc) -
comprlses all LhaL Lhe
parLners may acqulre by Lhelr
lndusLry or work durlng Lhe
exlsLence of Lhe parLnershlp
b. ÞarLlcular parLnershlp - lL ls one
whlch has for lLs ob[ecL,
deLermlnaLe Lhlngs, Lhelr use and
frulLs, or a speclflc underLaklng or
Lhe exerclse of a professlon or a
vocaLlon. (Att. 178J, Ncc)
2. lloblllty of pottoets
a. Ceneral parLnershlp - Cne where
all parLners are general parLners
who are llable even wlLh respecL Lo
Lhelr lndlvldual properLles, afLer
Lhe asseLs of Lhe parLnershlp have
been exhausLed (lotos,p. 411)
b. LlmlLed parLnershlp - Cne formed
by 2 or more persons havlng as
members one or more general
parLners and one or more llmlLed
parLners, Lhe laLLer noL belng
personally llable for Lhe obllgaLlons
of Lhe parLnershlp.
3. uototloo
a. ÞarLnershlp aL wlll - ÞarLnershlp
for a parLlcular underLaklng or
venLure whlch may be LermlnaLed
anyLlme by muLual agreemenL.
b. ÞarLnershlp wlLh a flxed perlod -
1he Lerm for whlch Lhe parLnershlp
ls Lo exlsL ls flxed or agreed upon
or one formed for a parLlcular
underLaklng.
4. leqollty of exlsteoce
a. ue [ure parLnershlp
b. ue facLo parLnershlp
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
!"#$%&#'()!
3. kepteseototloo to otbets
a. Crdlnary or real parLnershlp
b. CsLenslble or parLnershlp by
esLoppel - When Lwo or more
persons aLLempL Lo creaLe a
parLnershlp buL fall Lo comply wlLh
Lhe legal personallLles essenLlal for
[urldlcal personallLy, Lhe law
conslders Lhem as parLners, and
Lhe assoclaLlon ls a parLnershlp
lnsofar as lL ls favorable Lo Lhlrd
persons, by reason of Lhe equlLable
prlnclple of esLoppel (MocuooolJ
et. ol. v. Not´l. clty 8ook of New
¥otk, C.k. No. l7991, Moy 21,
1956)
6. lobllclty
a. SecreL parLnershlp - ÞarLnershlp
LhaL ls noL known Lo many buL only
as Lo lLs parLners.
b. noLorlous or open parLnershlp - lL
ls known noL only Lo Lhe parLners,
buL Lo Lhe publlc as well.
7. lotpose
a. Commerclal or Lradlng - Cne
formed for Lhe LransacLlon of
buslness.
b. Þrofesslonal or nonLradlng - Cne
formed for Lhe exerclse of a
professlon
62 789: 9>@ :8@ K;FF@>@?: R;?K< BF =9>:?@><8;=
H?K@> :8@ '=9?;<8 0;L;D 0BK@A
"2
1. 5ocleJoJ Aooolmo - slmllar Lo
anonymous parLnershlp
2. 5ocleJoJ colectlvo - whlch ls general or
collecLlve parLnershlp
3. 5ocleJoJ Je coeotos eo lottlclpocloo -
[olnL accounL parLnershlp
4. 5ocleJoJ Metcootlle keqolot colectlvo -
mercanLlle parLnershlp company
3. 5ocleJoJ leoollo - parLnershlp by whlch
Lhe enLlre proflLs should belong Lo some
of Lhe parLners ln excluslon of Lhe resL
62 78B E9P M@ =9>:?@><A
"2
4#2 Any person capaclLaLed Lo conLracL may
enLer lnLo a conLracL of parLnershlp.
SS7
`!%<2
1. Þersons who are prohlblLed from glvlng
each oLher any donaLlon or advanLage
cannoL enLer lnLo a unlversal
parLnershlp. (Att. 1782, Ncc)
2. Þersons sufferlng from clvll lnLerdlcLlon
3. Þersons who cannoL glve consenL Lo a
conLracL:
a. Mlnors
b. lnsane persons
c. ueafmuLes who do noL know how
Lo wrlLe
62 789: ;< :8@ =>;?J;=D@ BF '()(*+,- .(/-012(A
"2 1hls refers Lo Lhe rule LhaL ls lnherenL ln every
parLnershlp, LhaL no one can become a member
of Lhe parLnershlp assoclaLlon wlLhouL Lhe
consenL of all Lhe parLners.
%B:@2 Lven lf a parLner wlll assoclaLe anoLher person
ln hls share ln Lhe parLnershlp, Lhe assoclaLe shall
noL be admlLLed lnLo Lhe parLnershlp wlLhouL Lhe
consenL of all Lhe parLners, even lf Lhe parLner
havlng an assoclaLe should be a manager (Att. 1804,
Ncc).
62 /9P 9 JB>=B>9:;B? @?:@> ;?:B 9 =9>:?@><8;=
O;:8 9?B:8@> JB>=B>9:;B?A
"2 As a rule, lL ls lllegal for Lwo corporaLlons Lo
enLer lnLo a parLnershlp. neverLheless, a
corporaLlon may enLer lnLo a jolot veotote wlLh
anoLher lf Lhe naLure of Lhe venLure ls ln llne wlLh
Lhe buslness auLhorlzed by lLs charLer. (1oosoo v.
8oloños, C.k. No. l49J5, Moy 28, 1954)
62 789: 9>@ :8@ K;FF@>@?: R;?K< BF =9>:?@><A
"2
1. CaplLallsL - coottlbotes mooey ot
ptopetty to tbe commoo fooJ
2. loJosttlol - ConLrlbuLes only hls
lndusLry or personal servlce
3. Ceoetol - Cne whose llablllLy Lo 3
rd
persons exLends Lo hls separaLe or
personal properLy
4. llmlteJ - Cne whose llablllLy Lo 3
rd
persons ls llmlLed Lo hls caplLal
conLrlbuLlon
3. Moooqloq - Manages Lhe affalrs or
buslness of Lhe parLnershlp
6. llpolJotloq - 1akes charge of Lhe
wlndlng up of parLnershlp affalrs upon
dlssoluLlon
7. lottoet by estoppel - ls noL really a
parLner buL ls llable as a parLner for Lhe
proLecLlon of lnnocenL 3
rd
persons
8. cootlooloq pottoet - ConLlnues Lhe
buslness of a parLnershlp afLer lL has
been dlssolved by reason of Lhe
admlsslon of a new parLner, reLlremenL,
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
deaLh or expulslon of one of Lhe
parLners
9. 5otvlvloq pottoet - 8emalns afLer a
parLnershlp has been dlssolved by
deaLh of any parLner
SS8
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
10. 5obpottoet - ls noL a member of Lhe
parLnershlp, conLracLs wlLh a parLner
wlLh reference Lo Lhe laLLer's share ln
Lhe parLnershlp
11. Osteoslble - 1akes acLlve parL and
known Lo Lhe publlc as parLner ln Lhe
buslness
12. 5ectet - 1akes acLlve parL ln Lhe
buslness buL ls noL known Lo be a
parLner by ouLslde parLles
13. 5lleot - uoes noL Lake any acLlve parL ln
Lhe buslness alLhough he may be known
Lo be a parLner
14. uotmoot - uoes noL Lake acLlve parL ln
Lhe buslness and ls noL known or held
ouL as a parLner
62 789: 9>@ :8@ >@D9:;B?< J>@9:@K MP 9 JB?:>9J:
BF =9>:?@><8;=A
"2
1. ÞarLnersÞarLners
2. ÞarLnersÞarLnershlp
3. ÞarLnershlp3
rd
persons wlLh whom lL
conLracLs
4. ÞarLners3
rd
persons wlLh whom
parLnershlp conLracLs.
.5 *%)+&#'"3 +'5 !"#$)0*3"#c
4&%&#"3 +'5 3)/)$&1
*%)+&#'"3 !"#$%&#'()!
62 1;<:;?NH;<8 :8@ JD9<<@< BF H?;L@><9D
=9>:?@><8;=5
"2
"33 !#-.)$' "33 !#&'&%$ !#-!&#$,
wbot coostltotes commoo ptopetty
Cnly osoftoct of
Lhe properLles of
Lhe parLners
become commoo
ptopetty
3)) ./0.(/+4(- 9J:H9DDP
M@DB?N;?N :B :8@ =9>:?@>< 9>@
*01+/45,+(' d :8@P M@JBE@
JBEEB? =>B=@>:P
eBO?@K MP 9DD BF :8@ =9>:?@><
9?K :8@ =9>:?@><8;=f
As to ptoflts os commoo ptopetty
All ptoflts
acqulred by Lhe
loJostty of Lhe
parLners become
commoo ptopetty
(wheLher or noL
Lhey were
obLalned Lhrough
As to ptoflts ftom otbet sootces.
C8: "<;K@ F>BE :8@ JB?:>;MH:@K
=>B=@>:;@<Q :8@ ./064+- BF <9;K
=>B=@>:P M@JBE@ *07701
./0.(/+8
xÞn: !>BF;:< F>BE B:8@>
<BH>J@< E9P M@JBE@ *07701
Lhe usufrucL
conLrlbuLed)
;F :8@>@ ;< 9 <:;=HD9:;B? :B <HJ8
@FF@J:
As to ptopettles sobsepoeotly
ocpolteJ.
4#2 ÞroperLles subsequenLly
acqulred by lnherlLance, legacy
or donaLlon, coooot be lncluded
ln Lhe sLlpulaLlon
xÞn: -?DP F>H;:< :8@>@BF J9? M@
;?JDHK@K ;? :8@ <:;=HD9:;B? 93/+:
;<<=> #$$?
62 )F :8@ ">:;JD@< BF *?;L@><9D !9>:?@><8;= F9;D :B
<=@J;FP O8@:8@> ;: ;< B?@ BF 9DD =>@<@?: =>B=@>:P
B> BF =>BF;:<Q O89: <89DD M@ :8@ ?9:H>@ BF <HJ8A
"2 ArLlcles of unlversal ÞarLnershlp enLered lnLo
wlLhouL speclflcaLlon of lLs naLure only
consLlLuLes a unlversal parLnershlp of proflLs (Att.
1781, Ncc), because lL lmposes lesser obllgaLlons
on Lhe parLners, slnce Lhey preserve Lhe
ownershlp of Lhelr separaLe properLy.
!"#$)0*3"# !"#$%&#'()!
62 789: ;< =9>:;JHD9> =9>:?@><8;=A
"2 lL ls one whlch has for lLs ob[ecL, deLermlnaLe
Lhlngs, Lhelr use and frulLs, or a speclflc
underLaklng or Lhe exerclse of a professlon or a
vocaLlon. (Att. 178J, Ncc)
62 IQ ! 9?K C FB>E@K 9 D;E;:@K =9>:?@><8;= J9DD@K
'H:@> 0B5Q O;:8 ! 9< :8@ N@?@>9D =9>:?@> 9?K I
9?K C 9< D;E;:@K =9>:?@><5 I 9?K C JB?:>;MH:@K
!TgQYYY 9?K !UYQYYY >@<=@J:;L@DP5 39:@>Q I 9?K C
NB: E9>>;@K 9?K ! <BDK 8;< <89>@ BF :8@
=9>:?@><8;= :B :8@ <=BH<@< O8;J8 O9< >@JB>K@K
;? :8@ '&05 (9< :8@ D;E;:@K =9>:?@><8;= M@@?
K;<<BDL@K MP >@9<B? BF :8@ E9>>;9N@ M@:O@@? :8@
D;E;:@K =9>:?@><A
"2 no. 1he parLnershlp ls noL a unlversal buL a
parLlcular one. As provlded by law, a unlversal
parLnershlp requlres elLher LhaL Lhe ob[ecL of Lhe
assoclaLlon musL be all presenL properLy of Lhe
parLners as conLrlbuLed by Lhem Lo a common
fund, or all else LhaL Lhe parLners may acqulre by
Lhelr lndusLry or work. Pere, Lhe conLrlbuLlons
were flxed sums of money and nelLher one of
Lhem were lndusLrlal parLners. 1hus, Lhe flrm ls
noL a parLnershlp whlch Lhe spouses are
forbldden Lo enLer lnLo. 1he subsequenL marrlage
cannoL operaLe Lo dlssolve lL because lL ls noL one
of Lhe causes provlded by law. 1he caplLal
conLrlbuLlons were owned separaLely by Lhem
before Lhelr marrlage and shall remaln Lo be
separaLe under Lhe Spanlsh Clvll Code. 1helr
!"#$%&#'()!
SS9
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
lndlvldual lnLeresL dld noL become common
properLy afLer Lhelr marrlage. (commlsslooet of
lotetool keveooe v. 5otet, C.k. No. l255J2, leb.
28, 1969)
62 78@? KB@< 9 =9>:?@> M;?K :8@ =9>:?@><8;=A
"2
1. When he ls expressly or lmplledly
auLhorlzed
2. When he acLs ln behalf and ln Lhe name
of Lhe parLnershlp
4&%&#"3 !"#$%&#'()!
62 789: ;< N@?@>9D =9>:?@><8;=A
"2 Cne where all parLners are general parLners
who are llable even wlLh respecL Lo Lhelr
lndlvldual properLles, afLer Lhe asseLs of Lhe
parLnershlp have been exhausLed (lotos, clvll
coJe of tbe lblllpploes AooototeJ, volome 5, p.
411, 1969 6
tb
eJ)
62 78B ;< 9 N@?@>9D =9>:?@>A
"2 Cne whose llablllLy Lo Lhlrd persons exLends Lo
hls separaLe properLy, he may be elLher a
caplLallsL or an lndusLrlal parLner. (ue leoo,
commeots ooJ coses oo lottoetsblp, Aqeocy, ooJ
1tost, p. 77, 2005 eJ)
62 789: 9>@ :8@ BMD;N9:;B?< BF 9 =9>:?@>A
"2
1. CbllgaLlons among Lhemselves
2. CbllgaLlons Lo Lhlrd persons
62 789: ;< :8@ M9<;< FB> <HJ8 BMD;N9:;B?<A
"2 1hese obllgaLlons are based on LrusL and
confldence of Lhe parLners slnce parLnershlp ls
grounded on Lhe flduclary relaLlonshlp of Lhe
parLners and as well Lo Lhlrd persons.
62 789: 9>@ :8@ K;<:;?J:;B?< M@:O@@? 9 N@?@>9D 9?K 9 D;E;:@K =9>:?@>a=9>:?@><8;=A
"2
4&%&#"3 3)/)$&1
@A+(1+ 06 B4254)4+8
letsooolly lloble for parLnershlp obllgaLlons LlablllLy exteoJs ooly Lo hls caplLal conLrlbuLlons
C4DE+ 41 F212D(7(1+
When manner of managemenL ls noL agreed upon,
all general parLners have an equal rlghL ln Lhe
managemenL of Lhe buslness
no parLlclpaLlon ln managemenL
$01+/45,+401
ConLrlbuLe cash, properLy or lndusLry ConLrlbuLe cash or properLy only, noL lndusLry
G6 %/0.(/ %2/+8 +0 %/0*(('41D- !8 0/ 3D241-+ %2/+1(/-E4.
Þroper parLy Lo proceedlngs by/agalnsL parLnershlp
noL proper parLy Lo proceedlngs by/agalnsL parLnershlp,
ooless.
T5 Pe ls also a general parLner, or
U5 Where Lhe ob[ecL of Lhe proceedlng ls Lo enforce a
llmlLed parLner's rlghL or llablllLy Lo Lhe parLnershlp
3--4D17(1+ 06 G1+(/(-+
lnLeresL ls oot osslqooble wlLhouL consenL of oLher
parLners
lnLeresL ls fteely osslqooble
&4/7 #27(
name moy appear ln flrm name
4#2 name most oot appear ln flrm name
`!%<2
1. lL ls also Lhe surname of a general parLner,
2. Þrlor Lo Lhe Llme when Lhe llmlLed parLner became
such, Lhe buslness had been carrled on under a name
ln whlch hls surname appeared.
%/0E454+401 +0 @1D2D( 41 "+E(/ !,-41(--
ltoblblteJ ln engaglng ln buslness No ptoblbltloo agalnsL engaglng ln buslness
@66(*+ 06 H(2+E> G1-0)I(1*8> C(+4/(7(1+> G1-214+8
8eLlremenL, deaLh, lnsolvency, lnsanlLy of general
parLner dlssolves parLnershlp
uoes noL have same effecL, rlghLs are Lransferred Lo legal
represenLaLlve
$/(2+401
As a rule, lL maybe consLlLuLed ln any form, by CreaLed by Lhe members afLer subsLanLlal compllance ln
+'$ ,-./&% %-$&' 0122
conLracL or conducL of Lhe parLnershlp good falLh of Lhe requlremenLs seL forLh by law
$07.0-4+401 J F(75(/-E4.
Composed only of general parLners
Composed of one or more general parLners and one or
more llmlLed parLners
S4u
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
45 !"#$%&#'()! C, &'$-!!&3
62 78B ;< 9 =9>:?@> MP @<:B==@DA
"2 Cne who, by words or conducL does any of Lhe
followlng:
1. ulrecLly represenLs hlmself Lo anyone as
a parLner ln an exlsLlng parLnershlp or ln
a nonexlsLlng parLnershlp
2. lndlrecLly represenLs hlmself by
consenLlng Lo anoLher represenLlng hlm
as a parLner ln an exlsLlng parLnershlp
or ln a nonexlsLlng parLnershlp
62 789: 9>@ :8@ @D@E@?:< M@FB>@ 9 =9>:?@> J9?
M@ 8@DK D;9MD@ B? :8@ N>BH?K BF @<:B==@DA
"2
1. uefendanL represenLed hlmself as
parLner or ls represenLed by oLhers as
such, and dld noL deny/refuLe such
represenLaLlon.
2. ÞlalnLlff relled on such represenLaLlon.
3. SLaLemenL of defendanL ls noL refuLed.
62 789: 9>@ :8@ D;9M;D;:;@< ;? J9<@ BF @<:B==@DA
"2
KE(1 %2/+1(/-E4. 4- B425)(
lf all acLual parLners consenLed Lo Lhe
represenLaLlon, Lhen Lhe llablllLy of Lhe person who
represenLed hlmself Lo be a parLner or who
consenLed Lo such represenLaLlon and Lhe acLual
parLner ls consldered a parLnershlp llablllLy
KE(1 B4254)4+8 4- %C" C3L3
When Lhere ls no exlsLlng parLnershlp and all Lhose
represenLed as parLners consenLed Lo Lhe
represenLaLlon, Lhen Lhe llablllLy of Lhe person who
represenLed hlmself Lo be a parLner and all who
made and consenLed Lo such represenLaLlon, ls jolot
or ptototo
KE(1 B4254)4+8 4- M@%3C3L@
When Lhere ls no exlsLlng parLnershlp and noL all buL
only some of Lhose represenLed as parLners
consenLed Lo Lhe represenLaLlon, or none of Lhe
parLnershlp ln an exlsLlng parLnershlp consenLed Lo
such represenLaLlon, Lhen Lhe llablllLy wlll be
sepotote
(5 !"#$%&#'()! +5 I-)%$ +&%$*#&
62 789: ;< 9 VB;?: L@?:H>@A
"2 An assoclaLlon of persons or companles [olnLly
underLaklng some commerclal enLerprlse,
generally, all conLrlbuLes asseLs and share rlsks. lL
requlres a communlLy of lnLeresL ln Lhe
performance of Lhe sub[ecL maLLer, a rlghL Lo
dlrecL and govern Lhe pollcy ln connecLlon
LherewlLh, and a duLy whlch may be alLered by
agreemenL Lo share boLh ln proflLs and losses.
!9>:?@><8;= IB;?: +@?:H>@
L/21-2*+401- (1+(/(' 41+0
1he duraLlon of a
parLnershlp generally
relaLes Lo a conLlnulng
buslness of varlous
LransacLlons of a cerLaln
klnd.
LlmlLed Lo Lhe perlod ln
whlch Lhe goods are
sold or Lhe pro[ecL ls
carrled on or a slngle
LransacLlon.
#2+,/(
ÞermanenL, parLners are
lnLeresLed ln carrylng on
LogeLher of a general and
conLlnulng buslness of a
parLlcular klnd.
%B:@2 A pottlcolot
pottoetsblp has a llmlLed
and Lemporary or ad hoc
naLure, belng conflned Lo
a slngle underLaklng.
1emporary, alLhough lL
may conLlnue for a
number of years.
&4/7 #27( 21' B425)4+4(-
1here musL be a
parLnershlp or flrm name
under whlch Lhe
parLnershlp shall operaLe.
1he names of Lhe
parLners may appear ln
Lhe flrm name and Lhe
acL of Lhe parLners wlll
make Lhe parLnershlp
llable.
A flrm name ls noL
necessary, Lhus Lhe
parLlclpaLlng persons
can LransacL buslness
under Lhelr own name
and can be lndlvldually
llable Lherefore.
$0/.0/2+401 2- .2/+1(/
CorporaLlon cannoL enLer
lnLo a parLnershlp
conLracL, Lhus lL cannoL
be a parLner by reason of
publlc pollcy, oLherwlse
people oLher Lhan lLs
offlcers may be able Lo
blnd lL (Albooo, clvll low
CorporaLlons can
engage ln a [olnL
venLure wlLh oLhers
Lhrough a conLracL of
agreemenL lf Lhe naLure
of Lhe venLure ln llne
wlLh Lhe buslness of Lhe
corporaLlon and lL ls
!"#$%&#'()!
kevlewet, 1998, p.570) auLhorlzed ln lLs
charLer.
B(D2) %(/-012)4+8
A parLnershlp acqulres
personallLy afLer
followlng Lhe requlslLes
requlred by law. e.g. Att.
1771177J, Ncc
%B:@2 SLC reglsLraLlon ls
noL requlred before a
parLnershlp acqulres legal
personallLy. (Att. 1768,
Ncc)
A [olnL venLure has no
legal personallLy.
S41
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
)5 !#-.&'')-%"3 !"#$%&#'()!
62 789: ;< 9 =>BF@<<;B?9D =9>:?@><8;=A
"2 lL ls a parLnershlp formed by persons for Lhe
sole purpose of exerclslng Lhelr common
professlon, no parL of Lhe lncome of whlch ls
derlved from engaglng ln any Lrade or buslness.
62 )? 9 =>BF@<<;B?9D =9>:?@><8;=Q O8B ;< K@@E@K
@?N9N@K ;? :8@ =>9J:;J@ BF =>BF@<<;B?A
"2 lL ls Lhe lndlvldual parLners and noL Lhe
parLnershlp. 1hus, Lhey are responslble for Lhelr
own acLs.
62 789: ;< =>B8;M;:@K ;? :8@ FB>E9:;B? BF 9
=>BF@<<;B?9D =9>:?@><8;=A
"2 ÞarLnershlp beLween lawyers and members of
oLher professlon or nonprofesslonal persons
should noL be formed or permlLLed where any
parL of Lhe parLnershlp's employmenL conslsLs of
Lhe pracLlce of law. (coooos of ltofessloool
ítblcs)
62 789: 9>@ :8@ J89>9J:@>;<:;J< BF 9 =9>:?@><8;=
FB> :8@ =>9J:;J@ BF D9OA
"2
a. A duLy of publlc servlce, of whlch Lhe
emolumenL ls a byproducL
b. A relaLlon as an ºofflcer of courL" Lo Lhe
admlnlsLraLlon of [usLlce
c. A relaLlon Lo cllenLs ln Lhe hlghesL
flduclary degree
d. A relaLlonshlp Lo colleagues aL Lhe bar
characLerlzed by candor, falrness, and
unwllllngness Lo resorL Lo currenL
buslness meLhods of adverLlslng and
encroachmenL on Lhelr pracLlce, or
deallng wlLh Lhelr cllenLs. (lo tbe Mottet
of letltloo fot Aotbotlty to cootlooe use
of lltm Nome ´5yclp, 5olozot, etc.´ /
´Ozeoto komolo, etc.,´ 92 5ckA 1
j1979], cltloq n.5. utloket, leqol ítblcs
j195J], pp45.)
62 789: ;< =>B8;M;:@K ;? :8@ F;>E ?9E@ BF 9
=9>:?@><8;= FB> :8@ =>9J:;J@ BF D9OA
"2 ln Lhe selecLlon and use of flrm name, no false,
mlsleadlng, assumed, or Lrade names should be
used. (coooos of ltofessloool ítblcs)
I5 /"%"4&/&%$ -. $(& !"#$%&#'()!
62 789: 9>@ :8@ EBK@< BF 9==B;?:E@?: BF 9
E9?9N@>A
"2
3..041+7(1+ +E/0,DE
+E( 3/+4*)(- 06
%2/+1(/-E4.
3..041+7(1+ "+E(/
LE21 41 +E( 3/+4*)(-
Þower ls lttevocoble
wlLhouL [usL or lawful
cause
%B:@2 vote tepolteJ fot
temovol of moooqet
1. lor [usL cause -
voLe of Lhe
coottollloq
parLners
(conLrolllng
flnanclal lnLeresL)
2. WlLhouL cause or
for un[usL cause -
unanlmous voLe
Þower Lo acL ls tevocoble
ooytlme, wlLh or wlLhouL
cause (should be done by
Lhe conLrolllng lnLeresL)
@A+(1+ 06 %0N(/
1. lf he acLs ln good
falLh, he may do oll
octs of
oJmlolsttotloo
(desplLe
opposlLlon of hls
parLners)
2. lf he acLs ln bad
falLh, he cannoL
As long as he ls a
manager, he can perform
all acLs of admlnlsLraLlon
(lf oLhers oppose, he can
be removed)
+'$ ,-./&% %-$&' 0122
S42
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
62 789: ;< :8@ >HD@ O8@>@ :8@>@ 9>@ :OB B> EB>@
E9?9N@><A
"2
7;:8BH: <=@J;F;J9:;B? BF :8@;> >@<=@J:;L@ KH:;@<
9?K O;:8BH: <:;=HD9:;B? >@GH;>;?N H?9?;E;:P BF
9J:;B?
4#2 Lach may separaLely execuLe all acLs of
admlnlsLraLlon (unllmlLed power Lo
admlnlsLer)
`!%2 lf any of Lhe managers opposes, declslon
of Lhe ma[orlLy prevalls
%B:@2 lo cose of tle - ueclslon of Lhe coottollloq
lnLeresL (who are also managers) sboll ptevoll
#2+,/(
Ck. uooolmoos cooseot of oll tbe moooqloq
pottoets sboll be oecessoty fot tbe vollJlty of tbe
octs ooJ obseoce ot looblllty of ooy moooqloq
pottoet coooot be olleqeJ.
\lN. wbete tbete ls oo lmmloeot Jooqet of qtove
ot lttepotoble lojoty to tbe pottoetsblp.
62 789: ;< :8@ >HD@ O8@? :8@ E9??@> BF
E9?9N@E@?: 89< ?B: M@@? 9N>@@K H=B?A
"2
1. All parLners shall be consldered
managers and agenLs
2. unanlmous consenL ls requlred for
alLeraLlon of lmmovable properLy
62 "[HJ@?9 9?K !@K>B 9JGH;>@K 9 =9>J@D BF D9?K
9?K 9 MH;DK;?N5 "[HJ@?9 BM:9;?@K 9 DB9? F>BE $9;
$B?N 0B5Q <@JH>@K MP 9 EB>:N9N@ O8;J8 O9<
@S@JH:@K BL@> :8@ D9?K 9?K MH;DK;?N5 "><@?;BQ
>@=>@<@?:9:;L@ BF $9; $B?NQ ;?<H>@K ;: O;:8
$>9L@DD@>< /HD:; )?K@E?;:P 0B>=B>9:;B?5 $8@
MH;DK;?N 9?K :8@ JB?:@?:< :8@>@BF O@>@ >9[@K MP
F;>@5 $>9L@DD@>< F9;D@K :B =9P :8@ ;?<H>9?J@5
(@?J@Q "[HJ@?9 9?K !@K>B F;D@K 9 J9<@ 9N9;?<:
$>9L@DD@>< O8@>@;? $9; $B?N ;?:@>L@?@K JD9;E;?N
@?:;:D@E@?: :B :8@ =>BJ@@K< F>BE $>9L@DD@><5
78B ;< @?:;:D@K :B :8@ =>BJ@@K< BF :8@ =BD;JPA
"2 1al 1olng ls enLlLled Lo Lhe lnsurance proceeds.
Arsenlo conLracLed Lhe lnsurance pollcy on behalf
of 1al 1ong. As Lhe managlng parLner of Lhe
parLnershlp, he may execuLe all acLs of
admlnlsLraLlon lncludlng Lhe rlghL Lo sue debLors
of Lhe parLnershlp ln case of Lhelr fallure Lo pay
Lhelr obllgaLlons when lL became due and
demandable. Cr aL Lhe very leasL, Arsenlo ls an
agenL of Lhe parLnershlp. 8elng an agenL, lL ls
undersLood LhaL he acLed for and ln behalf of Lhe
flrm. (1ol 1ooq cboocbe & co. v. losotooce
commlsslooet, C.k. No. l55J97, leb. 29, 1988)
%B:@2 lf refusal of parLner ls manlfesLly pre[udlclal Lo
Lhe lnLeresL of parLnershlp, courL's lnLervenLlon may
be soughL.
62 789: 9>@ :8@ >@E@K;@< 9L9;D9MD@ :B :8@
J>@K;:B>< BF 9 =9>:?@>A
"2
1. SeparaLe or lndlvldual credlLors should
flrsL secote a [udgmenL on Lhelr credlL,
and
2. Apply Lo Lhe proper courL for a cbotqloq
otJet sub[ecLlng Lhe lnLeresL of Lhe
debLorparLner ln Lhe parLnershlp for
Lhe paymenL of Lhe unsaLlsfled amounL
of Lhe [udgmenL debL wlLh lnLeresL
Lhereon.
!"#$%&#'()!
62 789: 9>@ :8@ @FF@J:< BF :8@ 9J:< BF =9>:?@><A
"2
"0$' -. " !"#$%&# &..&0$
"J:< FB> 9==9>@?:DP J9>>P;?N B? ;? :8@ H<H9D O9P :8@
MH<;?@<< BF :8@ =9>:?@><8;=
WlLh blndlng effecL except:
1. When Lhe parLner so acLlng has ln facL no auLhorlLy Lo
acL for Lhe parLnershlp ln Lhe parLlcular maLLer, and
2. 1he person wlLh whom he ls deallng has knowledge of
Lhe facL LhaL he has no such auLhorlLy
"J:< ?B: ;? :8@ B>K;?9>P JBH><@ BF MH<;?@<<
uo oot bloJ parLnershlp ooless auLhorlzed by oLher
parLners (pot. 2, Att. 1818, Ncc)
"J:< BF <:>;J: KBE;?;B? B> BO?@><8;=:
1. Asslgnlng parLnershlp properLy ln LrusL for
credlLors,
2. ulsposlng of goodwlll of buslness,
3. uolng an acL whlch would make lL lmposslble Lo
carry on Lhe ordlnary buslness of parLnershlp,
4. Confesslng a [udgmenL,
3. LnLerlng lnLo a compromlse concernlng a
parLnershlp clalm or llablllLy,
6. SubmlLLlng parLnershlp clalm or llablllLy Lo
arblLraLlon,
7. 8enounclng clalm of parLnershlp
4#2 Cne or more buL less tboo oll Lhe parLners have no
auLhorlLy
`!%<2
1. auLhorlzed by Lhe oLher parLners, or
2. p
3. arLners have abandoned Lhe buslness (pot. 2, Att.
1818, Ncc)
"J:< ;? JB?:>9L@?:;B? BF 9 >@<:>;J:;B? B? 9H:8B>;:P
ÞarLnershlp ls oot lloble Lo 3
rd
persons havlng acLual or
presumpLlve knowledge of Lhe resLrlcLlon
62 789: ;< :8@ @FF@J: BF JB?L@P9?J@ BF 9 >@9D =>B=@>:PA
"2
S4S
$,!& -. 0-%+&,"%0& &..&0$
$;:D@ ;? :8@ =9>:?@><8;=W< ?9E@c
0B?L@P9?J@ ;? =9>:?@><8;= ?9E@
Conveyance passes LlLle buL parLnershlp can recover ooless.
1.
a. Conveyance was done ln Lhe usual way of buslness, and
b. 1he parLner so acLlng has Lhe auLhorlLy Lo acL for Lhe
parLnershlp, or
2. 1he properLy whlch has been conveyed by Lhe granLee or a
person clalmlng Lhrough such granLee Lo a holder for value
wlLhouL knowledge LhaL Lhe parLner, ln maklng Lhe
conveyance, has exceeded hls auLhorlLy
$;:D@ ;? :8@ =9>:?@><8;=W< ?9E@c
0B?L@P9?J@ ;? =9>:?@>_< ?9E@
Conveyance does noL pass LlLle buL only equlLable lnLeresL,
provlded.
1. Conveyance was done ln Lhe usual way of buslness, or
2. 1he parLner so acLlng has Lhe auLhorlLy Lo acL for Lhe
parLnershlp
$;:D@ ;? :8@ ?9E@ BF T B> EB>@ =9>:?@><Q 9?K
:8@ >@JB>K KB@< ?B: K;<JDB<@ :8@ >;N8: BF :8@
=9>:?@><8;=c 0B?L@P9?J@ ;? ?9E@ BF
=9>:?@>a< ;? O8B<@ ?9E@ :;:D@ <:9?K<
Conveyance passes LlLle buL Lhe parLnershlp may recover such
properLy lf Lhe parLners' acL Joes oot blnd Lhe parLnershlp:
1. 1he parLner so acLlng has oo auLhorlLy Lo acL for Lhe
parLnershlp, and
2. 1he person wlLh whom he ls deallng has knowledge of Lhe
facL ooless Lhe purchaser of hls asslgnee, ls a holder for
value, wlLhouL knowledge
$;:D@ ;? ?9E@ BF T B> EB>@ B> 9DD =9>:?@>< B>
b
>K
=@><B? ;? :>H<: FB> =9>:?@><8;=c
0B?L@P9?J@ @S@JH:@K ;? =9>:?@><8;= ?9E@
B> ;? ?9E@ BF =9>:?@><
Conveyance wlll ooly pass equlLable lnLeresL, ptovlJeJ:
1. 1he acL ls one wlLhln Lhe auLhorlLy of Lhe parLner, and
2. Conveyance was done ln Lhe usual way of Lhe buslness
$;:D@ ;? :8@ ?9E@< BF 9DD :8@ =9>:?@><c
0B?L@P9?J@ @S@JH:@K MP 9DD :8@ =9>:?@><
Conveyance wlll poss all Lhe rlghLs ln such properLy
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
S44
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
))5 #)4($' "%1 -C3)4"$)-%' -. !"#$%&#'()!
62 789: 9>@ :8@ >@<=B?<;M;D;:;@< BF 9 =9>:?@><8;=
:B =9>:?@><A
"2
1. kefooJ Lhe amounLs dlsbursed by
parLner ln behalf of Lhe parLnershlp plus
correspondlng lnLeresL from Lhe Llme
Lhe expenses are made (e.q. loans and
advances made by a parLner Lo Lhe
parLnershlp aslde from caplLal
conLrlbuLlon)
2. Aoswet fot obllqotloos a parLner may
have conLracLed ln good falLh ln Lhe
lnLeresL of Lhe parLnershlp buslness
3. Aoswet fot tlsks ln consequence of lLs
managemenL (Att. 1796)
)))5 #)4($' "%1 -C3)4"$)-%' -. !"#$%&#'
"/-%4 $(&/'&3+&'
62 789: 9>@ :8@ BMD;N9:;B?< BF =9>:?@>< 9EB?N
:8@E<@DL@<A
"2
1. ConLrlbuLlon of properLy (Att. 1786)
2. ConLrlbuLlon of money and money
converLed Lo personal use (Att. 1788)
3. ÞrohlblLlon ln engaglng ln buslness for
hlmself (Att. 1789)
4. ConLrlbuLe addlLlonal caplLal (Att. 1791)
3. Managlng parLner who collecLs debL
(Att. 1792)
6. ÞarLner who recelves share of
parLnershlp credlL (Att. 179J)
7. uamages Lo parLnershlp (Att. 1794)
8. 8ender lnformaLlon (Att. 1806)
9. AccounLable as flduclary (Att. 1807)
0-%$#)C*$)-% -. !#-!&#$,
62 789: 9>@ :8@ BMD;N9:;B?< BF =9>:?@>< O;:8
>@<=@J: :B JB?:>;MH:;B? BF =>B=@>:PA
"2 1o 0".!)
1. 0onLrlbuLe aL Lhe beglnnlng of Lhe
parLnershlp, or aL Lhe sLlpulaLed Llme,
Lhe money, properLy or lndusLry whlch
he may have promlsed Lo conLrlbuLe
2. "nswer for evlcLlon ln case Lhe
parLnershlp ls deprlved of Lhe
deLermlnaLe properLy conLrlbuLed
3. Answer Lo Lhe parLnershlp for Lhe .rulLs
of Lhe properLy Lhe conLrlbuLlon of
whlch he delayed, from Lhe daLe Lhey
should have been conLrlbuLed up Lo Lhe
Llme of acLual dellvery
4. !reserve sald properLy wlLh Lhe
dlllgence of a good faLher of a famlly,
pendlng dellvery Lo Lhe parLnershlp
3. )ndemnlfy Lhe parLnershlp for any
damage caused Lo lL by Lhe reLenLlon of
Lhe same or by Lhe delay ln lLs
conLrlbuLlon
62 78B M@9>< :8@ >;<R BF DB<< BF :8;?N<
JB?:>;MH:@KA
"2
\)%1 -. !#-!&#$, a $()%4
7(- C&"#' $(&
#)'\A
Speclflc and deLermlnaLe Lhlngs
whlch are noL funglble where
only Lhe use ls conLrlbuLed
parLners
Speclflc and deLermlnaLe Lhlngs
Lhe ownershlp of whlch ls
Lransferred Lo Lhe parLnershlp
parLnershlp
lunglble Lhlngs (Consumable)
1hlngs conLrlbuLed Lo be sold
1hlngs broughL and appralsed ln
Lhe lnvenLory
62 789: ;< :8@ @FF@J: ;F 9 =9>:?@> F9;D< :B
JB?:>;MH:@ :8@ =>B=@>:P O8;J8 8@ =>BE;<@K :B
K@D;L@> :B :8@ =9>:?@><8;=A
"2
1. ÞarLners become lpso jote a debLor of
Lhe parLnershlp even ln Lhe absence of
any demand (Att. 1786, Ncc)
2. 8emedy of Lhe oLher parLner ls noL
resclsslon buL speclflc performance wlLh
damages from defaulLlng parLner
0-%$#)C*$)-% -. /-%&, "%1 /-%&,
0-%+&#$&1 $- !&#'-%"3 *'&
62 789: 9>@ :8@ >HD@< >@N9>K;?N JB?:>;MH:;B? BF
EB?@P :B :8@ =9>:?@><8;=A
"2 0#)!
1. 1o $oottlbote on Lhe daLe flxed Lhe
amounL Lhe parLner has underLaken Lo
conLrlbuLe Lo Lhe parLnershlp
2. 1o Celmbotse any amounL Lhe parLner
may have Laken from Lhe parLnershlp
coffers and converLed Lo hls own use
3. 1o GoJemolfy Lhe parLnershlp for Lhe
damages caused Lo lL by delay ln Lhe
!"#$%&#'()!
conLrlbuLlon or converslon of any sum
for Lhe parLner's personal beneflLs
4. 1o %oy for Lhe agreed or legal lnLeresL,
lf Lhe parLner falls Lo pay hls
conLrlbuLlon on Llme or ln case he Lakes
any amounL from Lhe common fund and
converLs lL Lo hls own use
0-%$#)C*$& "11)$)-%"3 0"!)$"3
62 789: 9>@ :8@ >HD@< >@N9>K;?N BMD;N9:;B?< :B
JB?:>;MH:@ :B =9>:?@><8;= J9=;:9DA
"2
1. ÞarLners musL coottlbote equal shares
Lo Lhe caplLal of Lhe parLnershlp ooless
Lhere ls sLlpulaLlon Lo conLrary
2. CaplLallsL parLners musL coottlbote
addlLlonal caplLal ln case of lmmlnenL
loss Lo Lhe buslness of Lhe parLnershlp
when Lhere ls no sLlpulaLlon Lo Lhe
conLrary, 8efusal Lo do so shall creaLe
an obllgaLlon on Lhe refuslng parLner Lo
sell hls lnLeresL Lo Lhe oLher parLners
62 789: 9>@ :8@ >@GH;<;:@< M@FB>@ J9=;:9D;<:
=9>:?@>< 9>@ JBE=@DD@K :B JB?:>;MH:@ 9KK;:;B?9D
J9=;:9DA
"2
1. lmmlnenL loss of Lhe buslness of Lhe
parLnershlp
2. Ma[orlLy of Lhe caplLallsL parLners are of
Lhe oplnlon LhaL an addlLlonal
conLrlbuLlon Lo Lhe common fund
would save Lhe buslness
3. CaplLallsL parLner refuses dellberaLely Lo
conLrlbuLe (noL due Lo flnanclal
lnablllLy)
4. 1here ls no agreemenL Lo Lhe conLrary
S4S
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
/"%"4)%4 !"#$%&# 7(- 0-33&0$' 1&C$
62 789: 9>@ :8@ BMD;N9:;B?< BF E9?9N;?N
=9>:?@>< O8B JBDD@J: 8;< =@><B?9D >@J@;L9MD@
F>BE 9 =@><B? O8B 9D<B BO@< :8@ =9>:?@><8;=A
"2
1. Apply sum collecLed Lo 2 credlLs ln
proporLlon Lo Lhelr amounLs
2. lf he recelved lL for Lhe accounL of
parLnershlp, Lhe whole sum shall be
applled Lo parLnershlp credlL
%B:@2 kepolsltes.
1. AL leasL 2 debLs, one where Lhe collecLlng
parLner ls credlLor and Lhe oLher, where
Lhe parLnershlp ls Lhe credlLor
2. 8oLh debLs are demandable
3. ÞarLner who collecLs ls auLhorlzed Lo
manage and acLually manages Lhe
parLnershlp
!"#$%&# 7(- #&0&)+&' '("#& -.
!"#$%&#'()! 0#&1)$
OP KE2+ 4- +E( 05)4D2+401 06 2 .2/+1(/ NE0
/(*(4I(- -E2/( 06 .2/+1(/-E4. */('4+Q
"2 1o brlng Lo Lhe parLnershlp caplLal whaL he has
recelved even Lhough he may have glven recelpL
for hls share only.
%B:@2 kepolsltes.
1. A parLner has recelved ln whole or ln parL,
hls share of Lhe parLnershlp credlL
2. CLher parLners have noL collecLed Lhelr
shares
3. ÞarLnershlp debLor has become lnsolvenL
62 /9P 9 =@><B? O8B 89< ?B: K;>@J:DP :>9?<9J:@K
;? M@89DF BF 9? H?;?JB>=B>9:@K 9<<BJ;9:;B? M@
8@DK D;9MD@ FB> 9 JB?:>9J: @?:@>@K ;?:B MP <HJ8
9<<BJ;9:;B?A
"2 ?es. 1he llablllLy for a conLracL enLered lnLo on
behalf of an unlncorporaLed assoclaLlon or
osLenslble corporaLlon may lle ln a person who
may noL have dlrecLly LransacLed on lLs behalf,
buL reaped beneflLs from LhaL conLracL. (llm 1ooq
llm v. lblllpploe llsbloq Ceot loJosttles loc., C.k.
No. 1J6448, Nov. J, 1999)
!#-()C)$)-% )% &%4"4)%4 )% C*')%&''
62 789: 9>@ :8@ >HD@< >@N9>K;?N :8@ =>B8;M;:;B?
:B @?N9N@ ;? 9?B:8@> MH<;?@<<A
"2
)%1*'$#)"3 !"#$%&# 0"!)$"3)'$ !"#$%&#
%/0E454+401
CannoL engage ln
buslness for hlmself
unless Lhe parLnershlp
expressly permlLs hlm Lo
do so
CannoL engage ln
buslness (wlLh same
klnd of buslness wlLh
Lhe parLnershlp) for hls
own accounL, unless
Lhere ls a sLlpulaLlon Lo
Lhe conLrary
C(7('8
CaplLallsL parLners may:
1. Lxclude hlm from
Lhe flrm
2. Avall Lhemselves of
Lhe beneflLs whlch
he may have
obLalned
3. uamages, ln elLher
case (Att. 1789,
Ncc)
CaplLallsL parLner, who
vlolaLed shall:
1. 8rlng Lo Lhe
common fund any
proflLs accrulng Lo
hlm from sald
LransacLlon, and
2. 8ears all losses
(Att. 1808, Ncc)
+'$ ,-./&% %-$&' 0122
62 IB@ 9?K #HKP FB>E@K 9 =9>:?@><8;= :B B=@>9:@
9 J9> >@=9;> <8B= ;? 6H@[B? 0;:P5 IB@ =>BL;K@K
:8@ J9=;:9D O8;D@ #HKP JB?:>;MH:@K 8;< D9MB> 9?K
;?KH<:>P5 -? B?@ <;K@ BF :8@;> <8B=Q IB@ B=@?@K
9?K B=@>9:@K 9 JBFF@@ <8B=Q O8;D@ B? :8@ B:8@>
<;K@Q #HKP =H: H= 9 J9> 9JJ@<<B>;@< <:B>@5 /9P
:8@P @?N9N@ ;? <HJ8 <@=9>9:@ MH<;?@<<@<A 78PA
"2 !oe, Lhe caplLallsL parLner, may engage ln Lhe
resLauranL buslness because lL ls noL Lhe same
klnd of buslness Lhe parLnershlp ls engaged ln. Cn
Lhe oLher hand, 8udy may noL engage ln any
oLher buslness unless Lhelr parLnershlp expressly
permlLs hlm Lo do so because as an lndusLrlal
parLner he has Lo devoLe hls full Llme Lo Lhe
buslness of Lhe parLnershlp (Att. 1789, Ncc).
eUYYT C9> 6H@<:;B?f
1"/"4&' $- !"#$%&#'()!
62 789: ;< :8@ >HD@ O;:8 >@N9>K :B :8@ BMD;N9:;B?
BF 9 =9>:?@> 9< :B K9E9N@< <HFF@>@K MP :8@
=9>:?@><8;= :8>BHN8 8;< F9HD:A
"2
4#2 Lvery parLner ls responslble Lo Lhe
parLnershlp for damages suffered by lL
Lhrough hls own faulL. 1hese damages cannoL
be offseL by Lhe proflLs or beneflLs whlch he
may have earned for Lhe parLnershlp by hls
lndusLry.
`!%2 lf unusual proflLs are reallzed Lhrough
exLraordlnary efforLs of Lhe gullLy parLner, Lhe
courLs may equlLably mlLlgaLe or lessen hls
llablllLy for damages. (Att. 1794, Ncc)
1*$, $- #&%1&# )%.-#/"$)-%
62 789: ;< :8@ KH:P BF :8@ =9>:?@>< O;:8 >@<=@J:
:B ;?FB>E9:;B? 9FF@J:;?N :8@ =9>:?@><8;=A
"2 1hey shall render on demand Lrue and full
lnformaLlon of all Lhlngs affecLlng Lhe parLnershlp
Lo:
1. Lhe parLner, or
2. legal represenLaLlve of any deceased or
legally dlsabled parLner. (Att. 1806,
Ncc)
"00-*%$"C3& "' .)1*0)"#,
62 (BO 9>@ =9>:?@>< 9JJBH?:9MD@ :B @9J8 B:8@>
9< F;KHJ;9>PA
S46
"2 Lvery parLner musL accounL Lo Lhe parLnershlp
for any beneflL, and hold as LrusLee for lL any
proflLs derlved by hlm wlLhouL Lhe consenL of Lhe
oLher parLners from any LransacLlon connecLed
wlLh Lhe formaLlon, conducL, or llquldaLlon of Lhe
parLnershlp or from any use by hlm of lLs
properLy. (Att. 1807, Ncc)
#)4($' -. 4&%&#"3 !"#$%&#'
62 789: 9>@ :8@ =>B=@>:P >;N8:< BF 9 =9>:?@>A
3P MGF
1. 8lghL ln 'peclflc parLnershlp properLy
2. )nLeresL ln Lhe parLnershlp (share ln Lhe
proflLs and surplus)
3. 8lghL Lo parLlclpaLe ln Lhe /anagemenL
62 789: ;< :8@ ?9:H>@ BF 9 =9>:?@>_< >;N8: ;?
<=@J;F;J =9>:?@><8;= =>B=@>:PA
"2
1. Lqual rlghL Lo possesslon for
parLnershlp purposes
2. 8lghL ls noL asslgnable, excepL ln
connecLlon wlLh asslgnmenL of rlghLs of
all parLners ln Lhe same properLy
3. 8lghL ls llmlLed Lo hls share of whaL
remalns afLer parLnershlp debLs have
been pald
4. 8lghL ls noL sub[ecL Lo aLLachmenL or
execuLlon excepL on a clalm agalnsL Lhe
parLnershlp
3. 8lghL ls noL sub[ecL Lo legal supporL
62 789: 9>@ :8@ @FF@J:< BF 9<<;N?E@?: BF
=9>:?@>W< O8BD@ ;?:@>@<: ;? :8@ =9>:?@><8;=A
"2
1. klqbts wltbbelJ ftom tbe osslqoee.
Such asslgnmenL Joes oot granL Lhe
asslgnee Lhe rlghL Lo:
a. 1o lotetfete ln Lhe managemenL
b. 1o tepolte any lnformaLlon or
accounL
c. 1o lospect parLnershlp books
2. klqbts of osslqoee oo pottoet´s lotetest.
a. 1o tecelve ln accordance wlLh hls
conLracL Lhe proflLs accrulng Lo Lhe
asslgnlng parLner
b. 1o ovoll hlmself of Lhe usual
remedles provlded by law ln Lhe
evenL of fraud ln Lhe managemenL
c. 1o tecelve Lhe asslgnor's lnLeresL ln
case of dlssoluLlon
d. 1o tepolte an accounL of
parLnershlp affalrs, buL only ln case
Lhe parLnershlp ls dlssolved, and
such accounL shall cover Lhe perlod
from Lhe daLe only of Lhe lasL
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
!"#$%&#'()!
accounL agreed Lo by all Lhe
parLners
O. wbot ote tbe effects of cooveyooce of o
pottoet of bls lotetest lo tbe pottoetsblp?
A.
1. Conveyance of hls whole lnLeresL -
parLnershlp may elLher remaln or be
dlssolved
2. Asslgnee does noL necessarlly become a
parLner, he cannoL:
a. lnLerfere ln Lhe managemenL or
admlnlsLraLlon, or
b. demand lnformaLlon, accounLlng
and lnspecLlon of Lhe parLnershlp
books.
%B:@2 8uL Lhe asslgnee has Lhe followlng rlghLs:
1. recelve ln accordance wlLh hls conLracL
Lhe proflLs whlch Lhe asslgnlng parLner
would oLherwlse be enLlLled
2. avall hlmself of Lhe usual remedles
provlded by law ln evenL of fraud ln
managemenL
3. recelve asslgnor's lnLeresL ln case of
dlssoluLlon
4. requlre and accounL of parLnershlp affalrs
buL only ln case Lhe parLnershlp ls
dlssolved, and such accounL shall cover
Lhe perlod from Lhe daLe only of Lhe lasL
accounL agreed Lo by all Lhe parLles
0#)/)%"3 3)"C)3)$, .-# /)'"!!#-!#)"$)-%2
&'$"."
62 #B<9 >@J@;L@K F>BE IB;< EB?@PQ O;:8 :8@
@S=>@<< BMD;N9:;B? :B 9J: 9< IB;<W 9N@?: ;?
=H>J89<;?N DBJ9D J;N9>@::@<Q :B >@<@DD :8@E :B
<@L@>9D <:B>@<Q 9?K :B N;L@ IB;< :8@ JBEE;<<;B?
JB>>@<=B?K;?N :B :8@ =>BF;:< >@J@;L@K5 (BO@L@>Q
#B<9 E;<9==>B=>;9:@K 9?K JB?L@>:@K :8@ <9;K
9EBH?: KH@ :B IB;< :B 8@> =@><B?9D H<@ 9?K
M@?@F;:5 IB;< F;D@K 9 J9<@ BF @<:9F9 9N9;?<: #B<95
09? #B<9 K@?P D;9M;D;:P B? :8@ N>BH?K :89: 9
=9>:?@><8;= O9< FB>E@K M@:O@@? 8@> 9?K #B<9A
"2 no. Lven assumlng LhaL a conLracL of
parLnershlp was lndeed enLered lnLo by and
beLween Lhe parLles, when a parLner recelves any
money or properLy for a speclflc purpose (such as
LhaL obLalnlng ln Lhe lnsLanL case) and he laLer
mlsapproprlaLes Lhe same, ls gullLy of esLafa.
(llwoooq v. cA, C.k. No. 114J98, Oct. 24, 1997)
S47
)+5 -C3)4"$)-%' -. !"#$%&#'()!a!"#$%&#'
$- $()#1 !&#'-%'
62 789: 9>@ :8@ BMD;N9:;B?< BF =9>:?@>< O;:8
>@N9>K :B b
>K
=@><B?<A
"2
1. Lvery parLnershlp shall operaLe under a
fltm oome. Þersons who lnclude Lhelr
names ln Lhe parLnershlp name even lf
Lhey are noL members shall be llable as
a parLner
2. All parLners shall be llable for
coottoctool obllqotloos of Lhe
parLnershlp wlLh Lhelr properLy, afLer all
parLnershlp asseLs have been
exhausLed:
a. Þro raLa
b. Subsldlary
3. AJmlssloo ot tepteseototloo moJe by
ooy pottoet concernlng parLnershlp
affalrs wlLhln Lhe scope of hls auLhorlLy
ls evldence agalnsL Lhe parLnershlp
4. Notlce to pottoet of any maLLer relaLlng
Lo parLnershlp affalrs operaLes as noLlce
Lo parLnershlp except ln case of fraud:
a. knowledge of parLner acLlng ln Lhe
parLlcular maLLer acqulred whlle a
parLner
b. knowledge of Lhe parLner acLlng ln
Lhe parLlcular maLLer Lhen presenL
Lo hls mlnd
c. knowledge of any oLher parLner
who reasonably could and should
have communlcaLed lL Lo Lhe
acLlng parLner
5. ÞarLners and Lhe parLnershlp are
solldarlly llable Lo 3
rd
persons for Lhe
pottoet's tott ot bteocb of ttost
6. lloblllty of locomloq pottoet ls llmlLed
Lo:
a. Pls share ln Lhe parLnershlp
properLy for exlsLlng obllgaLlons
b. Pls separaLe properLy for
subsequenL obllgaLlons
7. cteJltots of pottoetsblp ote ptefetteJ ln
parLnershlp properLy & may aLLach
parLner's share ln parLnershlp asseLs
%B:@2 Cn solldary llablllLy. ArL. 1816 should be
consLrued LogeLher wlLh ArL. 1824 (lo coooectloo
wltb Atts. 1822 ooJ 182J). Whlle Lhe llablllLy of Lhe
parLners ls merely [olnL ln LransacLlons enLered lnLo
by Lhe parLnershlp, a Lhlrd person who LransacLed
wlLh sald parLnershlp may hold Lhe parLners
solldarlly llable for Lhe whole obllgaLlon lf Lhe case of
Lhe Lhlrd person falls under ArLlcles 1822 and 1823.
(Mooospoe v. cA, C.k. No. lJ9780, Nov. 11, 1985)
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
S48
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
+5 1)''-3*$)-%
62 1;<:;?NH;<8 K;<<BDH:;B?Q O;?K;?N H= 9?K
:@>E;?9:;B?5
1;<<BDH:;B? 7;?K;?N H= $@>E;?9:;B?
A change ln Lhe
relaLlon of Lhe
parLners
caused by any
parLner ceaslng
Lo be
assoclaLed ln
carrylng on Lhe
buslness.
SeLLllng Lhe
parLnershlp
buslness or
affalrs afLer
dlssoluLlon
ÞolnL ln Llme
when all
parLnershlp
affalrs are
wound up or
compleLed, Lhe
end of Lhe
parLnershlp llfe
62 789: 9>@ :8@ J9H<@< BF K;<<BDH:;B?A
"2
1. WlLhouL vlolaLlng Lhe agreemenL:
a. 1ermlnaLlon of Lhe deflnlLe Lerm or
speclflc underLaklng
b. Lxpress wlll of ooy parLner ln good
falLh, when Lhere ls oo deflnlLe
Lerm and oo speclfled underLaklng
c. Lxpress wlll of oll parLners (excepL
Lhose who have asslgned Lhelr
lnLeresLs or suffered Lhem Lo be
charged for Lhelr separaLe debLs)
elLher before or afLer Lhe
LermlnaLlon of any speclfled Lerm
or parLlcular underLaklng
d. Lxpulslon of any parLner ln good
falLh of a member
2. vlolaLlng Lhe agreemenL
3. unlawfulness of Lhe buslness
4. Loss
a. 5peclflc tbloq promlsed as
conLrlbuLlon ls losL or perlshed
befote dellvery
b. Loss of a speclflc Lhlng conLrlbuLed
befote or oftet Jellvety, lf only Lhe
ose of such ls conLrlbuLed
%B:@2 1he parLnershlp shall noL be
dlssolved by Lhe loss of Lhe Lhlng when lL
occurs afLer Lhe parLnershlp has acqulred
Lhe ownershlp Lhereof.
3. ueaLh of any of Lhe parLners
6. lnsolvency of any parLner or of Lhe
parLnershlp
7. Clvll lnLerdlcLlon of any parLner
8. 8y decree of courL under ArL. 1831, nCC
a. a parLner has been declared lnsane
or of unsound mlnd
b. a parLner becomes ln any oLher
way lncapable of performlng hls
parL of Lhe parLnershlp conLracL
c. a parLner has been gullLy of such
conducL as Lends Lo affecL
pre[udlclally Lhe carrylng on of Lhe
buslness
d. a parLner wlllfully or perslsLenLly
commlLs a breach of Lhe
parLnershlp agreemenL
e. Lhe buslness of Lhe parLnershlp can
only be carrled on aL a loss
f. oLher clrcumsLances render a
dlssoluLlon equlLable
62 789: 9>@ :8@ @FF@J:< BF K;<<BDH:;B?A
"2
1. ÞarLnershlp ls noL LermlnaLed
2. ÞarLnershlp conLlnues for a llmlLed
purpose
3. 1ransacLlon of new buslness ls
prohlblLed (ue leoo, commeots ooJ
coses oo lottoetsblp, Aqeocy, ooJ
1tost, p. 229, 2005 eJ)
%B:@2 1he dlssoluLlon of a parLnershlp musL noL be
undersLood ln Lhe absoluLe and sLrlcL sense so LhaL
aL Lhe LermlnaLlon of Lhe ob[ecL for whlch lL was
creaLed Lhe parLnershlp ls exLlngulshed, pendlng Lhe
wlndlng up of some lncldenLs and obllgaLlons of Lhe
parLnershlp, buL ln such case, Lhe parLnershlp wlll be
repuLed as exlsLlng unLll Lhe [urldlcal relaLlons arlslng
ouL of Lhe conLracL are dlssolved. (1estote of Motto
v. 5etto, C.k. No. l22825, leb. 14, 1925)
ulssoluLlon does noL auLomaLlcally resulL ln Lhe
LermlnaLlon of Lhe legal personallLy of Lhe
parLnershlp, nor Lhe relaLlons of Lhe parLners among
Lhemselves who remaln as coparLners unLll Lhe
parLnershlp ls LermlnaLed. (ue leoo, commeots ooJ
coses oo lottoetsblp, Aqeocy, ooJ 1tost, p. 29, 2005
eJ)
62 789: ;< :8@ @FF@J: BF K;<<BDH:;B? B? :8@
9H:8B>;:P BF 9 =9>:?@>A
"2
4#2 1he parLnershlp ceases Lo be a golng
concern
`!%2 1he parLner's power of represenLaLlon ls
conflned only Lo acLs lncldenL Lo wlndlng up or
compleLlng LransacLlons begun buL noL Lhen
flnlshed. (Att. 18J2, Ncc)
%B:@2 Sub[ecL Lo Lhe quallflcaLlons seL forLh ln
ArLlcles 1833 and 1834 ln relaLlon Lo ArLlcle
1832, nCC:
1. lo so fot os tbe pottoets tbemselves ote
coocetoeJ - 1he auLhorlLy of any parLner
Lo blnd Lhe parLnershlp by a new conLracL
ls lmmedlaLely LermlnaLed when Lhe
!"#$%&#'()!
dlssoluLlon ls oot by Lhe "cL, )nsolvency,
or 1eaLh of a parLner e")1f.
2. When Lhe dlssoluLlon ls by Lhe acL,
lnsolvency, or deaLh, Lhe LermlnaLlon of
auLhorlLy depends upon wheLher or noL
Lhe parLner had knowledge or noLlce of
dlssoluLlon (Att. 18JJ, Ncc).
62 $8@ 9>:;JD@< BF JB=9>:?@><8;= =>BL;K@ :89: ;?
J9<@ BF K@9:8 BF B?@ =9>:?@>Q :8@ =9>:?@><8;=
<89DD ?B: M@ K;<<BDL@K MH: <89DD M@ JB?:;?H@K MP
:8@ K@J@9<@K =9>:?@>W< 8@;><5 78@? (Q 9 =9>:?@>Q
K;@KQ 8;< O;F@Q 7Q :BBR BL@> :8@ E9?9N@E@?: BF
<BE@ BF :8@ >@9D =>B=@>:;@< O;:8 =@>E;<<;B? BF
:8@ <H>L;L;?N =9>:?@>Q `Q MH: 8@> ?9E@ O9< ?B:
;?JDHK@K ;? :8@ =9>:?@><8;= ?9E@5 '8@
@L@?:H9DDP <BDK :8@<@ >@9D =>B=@>:;@< 9F:@> 9 F@O
P@9><5 ` ?BO JD9;E< :89: 7 K;K ?B: 89L@ :8@
9H:8B>;:P :B E9?9N@ 9?K <@DD :8B<@ =>B=@>:;@< 9<
<8@ O9< ?B: 9 =9>:?@>5 )< :8@ <9D@ L9D;KA
"2 ?es. 1he wldow was noL a mere agenL, because
she had become a parLner upon her husband's
deaLh, as expressly provlded by Lhe arLlcles of co
parLnershlp, and by auLhorlzlng Lhe wldow Lo
manage parLnershlp properLy x recognlzed her as
a general parLner wlLh auLhorlLy Lo admlnlsLer
and allenaLe parLnershlp properLy. lL ls lmmaLerlal
LhaL W's name was noL lncluded ln Lhe flrm name,
slnce no converslon of sLaLus ls lnvolved, and Lhe
arLlcles of coparLnershlp expressly conLemplaLed
Lhe admlsslon of Lhe parLner's helrs lnLo Lhe
parLnershlp. (Copololoy v. 5yclp, C.k. No. l11840,
uec. 16, 196J)
62 789: ;< :8@ D;9M;D;:P BF 9 =9>:?@> O8@>@ :8@
K;<<BDH:;B? ;< J9H<@K MP :8@ 9J:Q K@9:8 B>
;?<BDL@?JP BF 9 =9>:?@>A
"2
4#2 Lach parLner ls llable Lo hls coparLners
for hls share, of any llablllLy creaLed by any
parLner for Lhe parLnershlp, as lf Lhe
parLnershlp had noL been dlssolved.
`!%<2 ÞarLners shall noL be llable when:
1. Lhe dlssoluLlon, belng by acL of any
parLner, Lhe parLner acLlng for Lhe
parLnershlp had knowledge of Lhe
dlssoluLlon, or
2. Lhe dlssoluLlon, belng by Lhe deaLh or
lnsolvency of a parLner, Lhe parLner
acLlng for Lhe parLnershlp had
knowledge or noLlce of Lhe deaLh or
lnsolvency (Att. 18JJ, Ncc)
S49
62 "F:@> :8@ K;<<BDH:;B? BF 9 =9>:?@><8;=Q J9? 9
=9>:?@> <:;DD M;?K :8@ =9>:?@><8;=A
"2
4#2 ?es. A parLner conLlnues Lo blnd
parLnershlp eveo oftet dlssoluLlon ln Lhe
followlng cases:
1. 1ransacLlons Lo wlnd up parLnershlp
affalrs/compleLe LransacLlons
unflnlshed aL dlssoluLlon,
2. 1ransacLlons whlch would blnd
parLnershlp lf noL dlssolved dlssoluLlon
had noL Laken place, provlded Lhe oLher
parLy/obllgee:
a.
l. Pad exteoJeJ credlL Lo parLnershlp
prlor Lo dlssoluLlon, and
ll. Pad oo koowleJqe/ootlce of
dlssoluLlon, or
b.
l. ulJ oot exteoJ credlL Lo parLnershlp,
ll. noJ koowo parLnershlp prlor Lo
dlssoluLlon, and
lll. noJ oo koowleJqe/ootlce of
dlssoluLlon/facL of dlssoluLlon noL
adverLlsed ln a newspaper of general
clrculaLlon ln Lhe place where
parLnershlp ls regularly carrled on.
`!%<2 ÞarLner cannoL blnd Lhe parLnershlp
anymore afLer dlssoluLlon where dlssoluLlon ls
due Lo unlawfulness Lo carry on buslness
`!% :B `!%2 Wlndlng up of parLnershlp affalrs
1. ÞarLner has become lnsolvenL
2. AcL ls noL approprlaLe for wlndlng up or
for compleLlng unflnlshed LransacLlons
3. CompleLely new LransacLlons whlch
would blnd Lhe parLnershlp lf
dlssoluLlon had noL Laken place wlLh
Lhlrd persons ln bad falLh.
4. ÞarLner ls unauLhorlzed Lo wlnd up
parLnershlp affalrs, except by
LransacLlon wlLh one who:
a.
l. noJ exteoJeJ credlL Lo parLnershlp
prlor Lo dlssoluLlon,
ll. noJ oo koowleJqe ot ootlce of
dlssoluLlon, or
b.
l. ulJ oot exteoJ credlL Lo parLnershlp
prlor Lo dlssoluLlon,
ll. noJ koowo parLnershlp prlor Lo
dlssoluLlon, and
lll. noJ oo koowleJqe/ootlce of
dlssoluLlon/facL of dlssoluLlon noL
adverLlsed ln a newspaper of general
clrculaLlon ln Lhe place where
parLnershlp ls regularly carrled on.
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
62 1B@< :8@ K;<<BDH:;B? BF 9 =9>:?@><8;=
K;<J89>N@ @S;<:;?N D;9M;D;:P BF 9 =9>:?@>A
"2
4#2 no.
`!%2 Sald llablllLy ls dlscharged when Lhere ls
an agreemenL beLween:
1. ÞarLner hlmself,
2. Þerson/s conLlnulng Lhe buslness, and
3. ÞarLnershlp credlLors
62 789: ;< :8@ B>K@> BF =>;B>;:P ;? :8@
K;<:>;MH:;B? BF 9<<@:< KH>;?N :8@ K;<<BDH:;B? BF 9
D;E;:@K =9>:?@><8;=A
"2 ln seLLlng accounLs afLer dlssoluLlon, Lhe
llablllLles of Lhe parLnershlp shall be enLlLled Lo
paymenL ln Lhe followlng order:
1. 1hose Lo credlLors, ln Lhe order of
prlorlLy as provlded by law, excepL
Lhose Lo llmlLed parLners on accounL of
Lhelr conLrlbuLlons, and Lo general
parLners
2. 1hose Lo llmlLed parLners ln respecL Lo
Lhelr share of Lhe proflLs and oLher
compensaLlon by way of lncome on
Lhelr conLrlbuLlons
3. 1hose Lo llmlLed parLners ln respecL Lo
Lhe caplLal of Lhelr conLrlbuLlons
4. 1hose Lo general parLners oLher Lhan
for caplLal and proflLs
3. 1hose Lo general parLners ln respecL Lo
proflLs
6. 1hose Lo general parLners ln respecL Lo
caplLal (Att. 186J, Ncc)
%B:@2 Sub[ecL Lo any sLaLemenL ln Lhe cerLlflcaLe or
Lo subsequenL agreemenL, llmlLed parLners share ln
Lhe parLnershlp asseLs ln respecL Lo Lhelr clalms for
caplLal, and ln respecL Lo Lhelr clalms for proflLs or
for compensaLlon by way of lncome on Lhelr
conLrlbuLlon respecLlvely, ln proporLlon Lo Lhe
respecLlve amounLs of such clalms.
7)%1)%4 *!
62 789: :9R@< =D9J@ KH>;?N :8@ O;?K;?N H= BF
:8@ =9>:?@><8;=A
"2 lL ls durlng Lhls Llme afLer dlssoluLlon LhaL
parLnershlp buslness or affalrs are belng seLLled.
(ue leoo, commeots ooJ coses oo lottoetsblp,
Aqeocy, ooJ 1tost, p. 229, 2005 eJ)
SSu
%B:@2 Lxamples of wlndlng up:
1. Þaylng prevlous obllgaLlons
2. CollecLlng asseLs prevlously demandable
Lngaglng ln new buslness necessary for wlndlng up
such as conLracLlng wlLh a demollLlon company for
Lhe demollLlon of Lhe garage used ln a ºused car"
parLnershlp (lotos, clvll coJe of tbe lblllpploes
AooototeJ, volome 5, p. 485, 1969 6
tb
eJ)
62 78B 9>@ :8@ =@><B?< 9H:8B>;[@K :B O;?K H=A
"2
1. ÞarLners deslgnaLed by Lhe agreemenL
2. ln Lhe absence of such, all parLners who
have noL wrongfully dlssolved Lhe
parLnershlp
3. Legal represenLaLlve of lasL survlvlng
parLner who ls noL lnsolvenL
62 789: 9>@ =9>:?@><8;= 9<<@:<A
"2
1. ÞarLnershlp properLy
2. ConLrlbuLlons of Lhe parLners necessary
for Lhe paymenL of all llablllLles jAtt.
18J9 (2), Ncc]
62 789: ;< :8@ B>K@> BF =9PE@?: ;? O;?K;?N H=A
"2
1. 1hose owlng Lo credlLors oLher Lhan
parLners
2. 1hose owlng Lo parLners oLher Lhan for
caplLal or proflLs
3. 1hose owlng Lo parLners ln respecL of
caplLal
4. 1hose owlng Lo parLners ln respecL Lo
proflLs jAtt. 18J9 (2), Ncc]
62 789: ;< :8@ KBJ:>;?@ BF E9><89DD;?N BF 9<<@:<A
"2
1. ÞarLnershlp credlLors have preference
ln parLnershlp asseLs
2. SeparaLe or lndlvldual credlLors have
preference ln separaLe or lndlvldual
properLles
3. AnyLhlng lefL from elLher goes Lo Lhe
oLher.
62 789: 9>@ :8@ >;N8:< BF 9 =9>:?@> O8@>@
K;<<BDH:;B? ;< ?B: ;? JB?:>9L@?:;B? BF :8@
9N>@@E@?:A
"2 uoless otbetwlse oqteeJ, Lhe rlghLs of each
parLner are as follows:
1. 1o have Lhe pottoetsblp ptopetty
applled Lo dlscharge Lhe llablllLles of
parLnershlp, and
2. 1o have Lhe sotplos, lf any, applled, Lo
pay ln cash Lhe neL amounL owlng Lo
Lhe respecLlve parLners.
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
!"#$%&#'()!
62 789: 9>@ :8@ >;N8:< BF 9 =9>:?@> O8@>@
K;<<BDH:;B? ;< ;? JB?:>9L@?:;B? BF :8@
9N>@@E@?:A
"2 1he rlghLs of a parLner vary JepeoJloq opoo
wbetbet be ls tbe loooceot ot qollty pottoet.
1. 8lghLs of parLner who bos oot cooseJ
Lhe dlssoluLlon wrongfully:
a. 1o have pottoetsblp ptopetty
opplleJ for Lhe paymenL of lLs
llablllLles and Lo recelve ln cash hls
share of Lhe surplus
b. 1o be loJemolfleJ for Lhe damages
caused by Lhe parLner gullLy of
wrongful dlssoluLlon
c. 1o cootlooe tbe bosloess ln Lhe
same name durlng Lhe agreed Lerm
of Lhe parLnershlp, by Lhemselves
or [olnLly wlLh oLhers
d. 1o possess pottoetsblp ptopetty
should Lhey declde Lo conLlnue Lhe
buslness
2. 8lghLs of parLner who bos wtooqfolly
cooseJ Lhe dlssoluLlon:
a. lf tbe bosloess ls oot cootlooeJ by
Lhe oLher parLners, Lo have Lhe
parLnershlp properLy applled Lo
dlscharge lLs llablllLles and Lo
recelve ln cash hls share of Lhe
surplus less damages caused by hls
wrongful dlssoluLlon
b. lf tbe bosloess ls cootlooeJ.
l. 1o have Lhe value of hls
lnLeresL ln Lhe parLnershlp aL
Lhe Llme of Lhe dlssoluLlon,
less any damage caused by
Lhe dlssoluLlon Lo hls co
parLners, ascerLalned and pald
ln cash, or secured by bond
approved by Lhe courL, and
ll. 1o be released from all
exlsLlng and fuLure llablllLles
of Lhe parLnershlp
62 789: 9>@ :8@ >;N8:< BF ;?VH>@K =9>:?@> O8@>@
=9>:?@><8;= JB?:>9J: ;< >@<J;?K@KA
"2
1. 8lghL of a lleo oo, ot teteotloo of, Lhe
surplus of parLnershlp properLy afLer
saLlsfylng parLnershlp llablllLles for any
sum of money pald or conLrlbuLed by
hlm,
SS1
2. 8lghL of sobtoqotloo ln place of
parLnershlp credlLors afLer paymenL of
parLnershlp llablllLles, and
3. 8lghL of loJemolflcotloo by Lhe gullLy
parLner agalnsL all debLs and llablllLles
of Lhe parLnershlp.
62 (BO 9>@ :8@ 9JJBH?:< <@::D@K M@:O@@?
=9>:?@><A
"2
1. AsseLs of Lhe parLnershlp lnclude:
a. ÞarLnershlp properLy (lncludlng
goodwlll)
b. ConLrlbuLlons of Lhe parLners
2. Crder of appllcaLlon of Lhe asseLs:
a. lltst, Lhose owlng Lo parLnershlp
credlLors
b. 5ecooJ, Lhose owlng Lo parLners
oLher Lhan for caplLal and proflLs
such as loans glven by Lhe parLners
or advances for buslness expenses
c. 1bltJ, Lhose owlng for Lhe reLurn of
Lhe caplLal conLrlbuLed by Lhe
parLners
d. loottb, Lhe share of Lhe proflLs, lf
any, due Lo each parLner
62 " =9>:?@><8;= O9< FB>E@K O;:8 /9NKH<9 9<
:8@ E9?9N@>5 1H>;?N :8@ @S;<:@?J@ BF :8@
=9>:?@><8;=Q :OB =9>:?@>< @S=>@<<@K :8@;> K@<;>@
:B O;:8K>9O F>BE :8@ F;>E5 /9NKH<9 K@:@>E;?@K
:8@ L9DH@ BF :8@ =9>:?@>< <89>@ O8;J8 O@>@
@EMBK;@K ;? :8@ KBJHE@?: K>9O? ;? :8@
89?KO>;:;?N BF /9NKH<9 MH: O9< ?B: <;N?@K MP
9DD BF :8@ =9>:?@><5 39:@>Q :8@ O;:8K>9O;?N
=9>:?@>< K@E9?K@K FB> =9PE@?: MH: O@>@
>@FH<@K5 0B?<;K@>;?N :89: ?B: 9DD =9>:?@><
;?:@>L@?@K ;? :8@ K;<:>;MH:;B? BF 9DD B> =9>: BF :8@
=9>:?@><8;= 9<<@:<Q <8BHDK :8@ 9J:;B? =>B<=@>A
"2 no. A parLner's share cannoL be reLurned
wlLhouL flrsL dlssolvlng and llquldaLlng Lhe
parLnershlp, for Lhe reLurn ls dependenL on Lhe
dlscharge of credlLors, whose clalms en[oy
preference over Lhose of Lhe parLner, and lL ls
selfevldenL LhaL all members of Lhe parLnershlp
are lnLeresLed ln lLs asseLs and buslness, and are
enLlLled Lo be heard ln Lhe maLLer of Lhe flrm's
llquldaLlon and dlsLrlbuLlon of lLs properLy. 1he
llquldaLlon prepared by Magdusa noL slgned by
Lhe oLher parLners ls noL blndlng on Lhem.
(MoqJoso v. Albotoo, C.k. No. l17526, Iooe J0,
1962)
62 789: ;< =9>:?@>W< D;@?A
"2 1he rlghL of every parLner Lo have Lhe
parLnershlp properLy applled, Lo dlscharge
parLnershlp llablllLles and surplus asseLs, lf any,
dlsLrlbuLed ln cash Lo Lhe respecLlve parLners,
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
afLer deducLlng whaL may be due Lo Lhe
parLnershlp from Lhem as parLners.
62 09? 9 =9>:?@> K@E9?K FB> 8;< <89>@ KH>;?N :8@
@S;<:@?J@ BF 9 =9>:?@><8;=A
"2 no. A share ln a parLnershlp can be reLurned
only afLer Lhe compleLlon of Lhe laLLer's
dlssoluLlon, llquldaLlon and wlndlng up of Lhe
buslness.
Slnce Lhe caplLal was conLrlbuLed Lo Lhe
parLnershlp, noL Lo parLners, lL ls Lhe parLnershlp
LhaL musL refund Lhe equlLy of Lhe reLlrlng
parLners. Slnce lL ls Lhe parLnershlp, as a separaLe
and dlsLlncL enLlLy LhaL musL refund Lhe shares of
Lhe parLners, Lhe amounL Lo be refunded ls
necessarlly llmlLed Lo lLs LoLal resources. ln oLher
words, lL can only pay ouL whaL lL has ln lLs
coffers, whlch conslsLs of all lLs asseLs. (vllloteol v.
komltez, C.k. No. 144214, Ioly 14, 200J)
62 789: 9>@ :8@ @FF@J:< O8@? :8@ MH<;?@<< BF 9
K;<<BDL@K =9>:?@><8;= ;< JB?:;?H@KA
"2
1. CredlLors of old parLnershlp are also
credlLors of Lhe new parLnershlp who
conLlnues Lhe buslness of Lhe old one
wlLhouL llquldaLlon of Lhe parLnershlp
affalrs.
2. CredlLors have an equlLable llen on Lhe
conslderaLlon pald Lo Lhe
reLlrlng/deceased parLner by Lhe
purchaser when reLlrlng/deceased
parLner sold hls lnLeresL wlLhouL flnal
seLLlemenL wlLh credlLors.
3. 8lghLs of reLlrlng/esLaLe of deceased
parLner:
a. 1o have Lhe value of hls lnLeresL
ascerLalned as of Lhe daLe of
dlssoluLlon, and
b. 1o recelve as ordlnary credlLor Lhe
value of hls share ln Lhe dlssolved
parLnershlp wlLh lnLeresL or proflLs
aLLrlbuLable Lo use of hls rlghL, aL
hls opLlon.
%B:@2 1he rlghL Lo demand on accounLlng of Lhe
value of hls lnLeresL accrues Lo any parLner or hls
legal represenLaLlve afLer dlssoluLlon ln Lhe absence
of an agreemenL Lo Lhe conLrary.
SS2
ltesctlptloo beglns Lo run only upon Lhe dlssoluLlon
of Lhe parLnershlp, when Lhe flnal accounLlng ls
done.
62 78B 9>@ :8@ =@><B?< >@GH;>@K :B >@?K@> 9?
9JJBH?:A
"2
1. Wlndlng up parLner,
2. Survlvlng parLner, and
3. Þerson or parLnershlp conLlnulng Lhe
buslness
62 &E?9J@ 9?K $9M9?9B K@J;K@K :B K;<<BDL@
:8@;> =9>:?@><8;= ;? TZgh5 &E?9J@ F9;D@K :B
<HME;: :8@ <:9:@E@?: BF 9<<@:< 9?K D;9M;D;:;@< BF
:8@ =9>:?@><8;=Q 9?K :B >@?K@> 9? 9JJBH?:;?N BF
:8@ =9>:?@><8;=_< F;?9?J@<5 $9M9?9BW< 8@;>< F;D@K
9N9;?<: &E?9J@ 9? 9J:;B? FB> 9JJBH?:;?NQ @:J5
&E?9J@ JBH?:@><Q JB?:@?K;?N :89: =>@<J>;=:;B?
89< <@: ;?5 1@J;K@5
"2 ÞrescrlpLlon has noL yeL seL ln. ÞrescrlpLlon of
Lhe sald rlghL sLarLs Lo run only upon Lhe
dlssoluLlon of Lhe parLnershlp when Lhe flnal
accounLlng ls done. ConLrary Lo Lmnace's
proLesLaLlons, prescrlpLlon had noL even begun Lo
run ln Lhe absence of a flnal accounLlng. 1he rlghL
Lo demand an accounLlng accrues aL Lhe daLe of
dlssoluLlon ln Lhe absence of any agreemenL Lo
Lhe conLrary. When a flnal accounLlng ls made, lL
ls only Lhen LhaL prescrlpLlon beglns Lo run.
(ímooce v. cA, C.k. No. 126JJ4, Nov. 2J, 2001)
62 !9HD;?@Q !9:>;J;9 9?K !>;<J;DD9 FB>E@K 9
MH<;?@<< =9>:?@><8;= FB> :8@ =H>=B<@ BF @?N9N;?N
;? ?@B? 9KL@>:;<;?N FB> 9 :@>E BF F;L@ eXf P@9><5
!9HD;?@ <HM<@GH@?:DP 9<<;N?@K :B !8;D;= 8@>
;?:@>@<: ;? :8@ =9>:?@><8;=5 78@? !9:>;J;9 9?K
!>;<J;DD9 D@9>?@K BF :8@ 9<<;N?E@?:Q :8@P K@J;K@K
:B K;<<BDL@ :8@ =9>:?@><8;= M@FB>@ :8@ @S=;>9:;B?
BF ;:< :@>E 9< :8@P 89K 9? H?=>BKHJ:;L@ MH<;?@<<
>@D9:;B?<8;= O;:8 !8;D;= ;? :8@ =9<:5 -? :8@ B:8@>
89?KQ H?9O9>@ BF :8@ EBL@ BF !9:>;J;9 9?K
!>;<J;DD9 MH: <@?<;?N :8@;> ?@N9:;L@ >@9J:;B? :B 8;<
9JGH;<;:;B? BF !9HD;?@W< ;?:@>@<:Q !8;D;=
<;EHD:9?@BH<DP =@:;:;B?@K FB> :8@ K;<<BDH:;B? BF
:8@ =9>:?@><8;=5
)< :8@ K;<<BDH:;B? KB?@ MP !9:>;J;9 9?K !>;<J;DD9
O;:8BH: :8@ JB?<@?: BF !9HD;?@ B> !8;D;= L9D;KA
&S=D9;?5
"2 *nder ArL 1830(1)(c), nCC, Lhe dlssoluLlon by
ÞaLrlcla and Þrlscllla ls valld and dld noL vlolaLe
Lhe conLracL of parLnershlp even Lhough Þaullne
and Þhlllp dld noL consenL LhereLo. 1he consenL of
Þaullne ls noL necessary because she had already
asslgned her lnLeresL Lo Þhlllp. 1he consenL of
Þhlllp ls also noL necessary because Lhe
asslgnmenL Lo hlm of Þaullne's lnLeresL dld noL
make hlm a parLner, under ArL. 1813, nCC.
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
!"#$%&#'()!
1B@< !8;D;= 89L@ 9?P >;N8: :B =@:;:;B? FB> :8@
K;<<BDH:;B? BF :8@ =9>:?@><8;= M@FB>@ :8@
@S=;>9:;B? BF ;:< <=@J;F;@K :@>EA &S=D9;?5
"2 no, Þhlllp has no rlghL Lo peLlLlon for
dlssoluLlon because he does noL have Lhe
sLandlng of a parLner. (Att. 181J, Ncc) eTZZX C9>
6H@<:;B?f
SSS
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+)5 3)/)$&1 !"#$%&#'()!
"5 1&.)%)$)-%
62 789: ;< D;E;:@K =9>:?@><8;=A
"2 Cne formed by Lwo or more persons havlng as
members one or more general parLners and one
or more llmlLed parLners, Lhe laLLer noL belng
personally llable for parLnershlp debLs (Att. 184J)
62 789: 9>@ :8@ J89>9J:@>;<:;J< BF D;E;:@K
=9>:?@><8;=A
"2
1. lL ls formed by compllance wlLh Lhe
sLaLuLory requlremenLs
2. Cne or more general parLners conLrol
Lhe buslness and are personally llable Lo
credlLors
3. Cne or more llmlLed parLners
conLrlbuLe Lo Lhe caplLal and share ln
Lhe proflLs bot Jo oot parLlclpaLe ln Lhe
managemenL of Lhe buslness and are
noL personally llable for parLnershlp
obllgaLlons beyond Lhelr caplLal
conLrlbuLlons
4. 1he llmlLed parLners may ask for Lhe
reLurn of Lhelr caplLal conLrlbuLlons
under condlLlons prescrlbed by law
3. ÞarLnershlp debLs are pald ouL of
common fund and Lhe lndlvldual
properLles of general parLners
C5 (-7 3)/)$&1 !"#$%&#'()! )'
.-#/&1a"/&%1&1
62 789: 9>@ :8@ @<<@?:;9D >@GH;>@E@?:< FB> :8@
FB>E9:;B? BF D;E;:@K =9>:?@><8;=A
"2
1. CerLlflcaLe of arLlcles of llmlLed
parLnershlp whlch sLaLes Lhe maLLers
enumeraLed ln ArL. 1844, nCC, musL be
slgned and sworn, and
2. CerLlflcaLe musL be flled for record ln
Lhe offlce of Lhe SLC.
%B:@2 SLrlcL compllance wlLh legal requlremenLs ls
noL necessary. lL ls sufflclenL LhaL Lhere ls subsLanLlal
compllance ln good falLh (Io cboo v. loclflc
commetclol co., C.k. No. 19892, 5ept. 6, 192J).
62 1B@< 9 D;E;:@K =9>:?@><8;= 89L@ 9 =@><B?9D;:P
<@=9>9:@ 9?K K;<:;?J: F>BE :89: BF :8@ =9>:?@><A
789: 9>@ :8@ JB?<@GH@?J@< BF <HJ8A
"2 ?es. 1he personallLy of a llmlLed parLnershlp
belng dlfferenL from LhaL of lLs members, lL musL,
on general prlnclple, answer for, and suffer, Lhe
consequence of lLs acLs as such an enLlLy capable
of belng Lhe sub[ecL of rlghLs and obllgaLlons. lf
Lhe llmlLed parLnershlp falled Lo pay lLs
obllgaLlons, Lhls parLnershlp musL suffer Lhe
consequences of such a fallure, and musL be
ad[udged lnsolvenL. (compos koeJo & co. v.
loclflc commetclol co., et. ol, C.k. No. l 1870J,
Aoq. 28, 1922)
62 78@? ;< :8@ J@>:;F;J9:@ B> 9>:;JD@< BF D;E;:@K
=9>:?@><8;= J9?J@DD@KA
"2
1. When Lhe parLnershlp ls dlssolved
2. When all Lhe llmlLed parLners ceased Lo
be such
62 78@? E9P 9 J@>:;F;J9:@ B> 9>:;JD@< BF D;E;:@K
=9>:?@><8;= M@ 9E@?K@KA
"2
1. lL musL fall under Lhe followlng changes
and condlLlons:
a. 1here ls a change ln Lhe name of
Lhe parLnershlp or ln Lhe amounL
or characLer of Lhe conLrlbuLlon of
any llmlLed parLner
b. A person ls subsLlLuLed as a llmlLed
parLner
c. An addlLlonal llmlLed parLner ls
admlLLed
d. A person ls admlLLed as a general
parLner
e. A general parLner reLlres, dles,
becomes lnsolvenL or lnsane, or ls
senLenced Lo clvll lnLerdlcLlon and
Lhe buslness ls conLlnued under
ArLlcle 1860
f. 1here ls a change ln Lhe characLer
of Lhe buslness of Lhe parLnershlp
g. 1here ls a false or erroneous
sLaLemenL ln Lhe cerLlflcaLe
h. 1here ls a change ln Lhe Llme as
sLaLed ln Lhe cerLlflcaLe for Lhe
dlssoluLlon of Lhe parLnershlp or
for Lhe reLurn of a conLrlbuLlon
l. A Llme ls flxed for Lhe dlssoluLlon
of Lhe parLnershlp, or Lhe reLurn of
+'$ ,-./&% %-$&' 0122
a conLrlbuLlon, no Llme havlng
been speclfled ln Lhe cerLlflcaLe
[. 1he members deslre Lo make a
change ln any oLher sLaLemenL ln
Lhe cerLlflcaLe ln order LhaL lL shall
accuraLely represenL Lhe
agreemenL among Lhem (Att.
1864, Ncc)
2. MusL be slgned and sworn Lo by all of
Lhe members lncludlng Lhe new
members lf some added, ln case of
subsLlLuLlon, Lhe asslgnlng llmlLed
parLner musL also slgn
3. MusL be recorded ln Lhe SLC
3)/)$&1 !"#$%&#
62 789: 9>@ :8@ D;9M;D;:;@< BF 9 D;E;:@K =9>:?@>A
"2
SS4
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
"' 0#&1)$-# "' $#*'$&&
ueflclency ln
conLrlbuLlon
Speclflc properLy sLaLed as
conLrlbuLed buL noL yeL
conLrlbuLed/ wrongfully reLurned
unpald
conLrlbuLlon
Money/oLher properLy
wrongfully pald/ conveyed Lo hlm
on accounL of hls conLrlbuLlon
62 789: :>9?<9J:;B?< 9>@ 9DDBO@K B> =>B8;M;:@K
;? 9 D;E;:@K =9>:?@><8;=A
"2
1. AlloweJ
a. Ctootloq loans Lo parLnershlp
b. 1toosoctloq buslness wlLh
parLnershlp
c. kecelvloq pro raLa share of
parLnershlp asseLs wlLh general
credlLors lf he ls noL also a general
parLner
2. ltoblblteJ
a. kecelvloq/bolJloq parLnershlp
properLy as collaLeral securlLy
b. kecelvloq any paymenL,
conveyance, release from llablllLy lf
lL wlll pre[udlce rlghL of 3
rd
persons
%B:@2 vlolaLlon of Lhe prohlblLlon wlll glve rlse Lo Lhe
presumpLlon LhaL lL has been made Lo defraud
parLnershlp credlLors.
1he prohlblLlon ls noL absoluLe because Lhere ls no
prohlblLlon lf Lhe parLnershlp asseLs are sufflclenL Lo
dlscharge parLnershlp llablllLles Lo persons noL
clalmlng as general or llmlLed parLners.
62 78@? KB@< 9 N@?@>9D =9>:?@> ?@@K JB?<@?: B>
>9:;F;J9:;B? BF 9DD :8@ D;E;:@K =9>:?@><A
"2 When he:
1. does any acL ln conLravenLlon of Lhe
cerLlflcaLe,
2. does any acL whlch would make lL
lmposslble Lo carry on Lhe ordlnary
buslness of Lhe parLnershlp,
3. confesses [udgmenL agalnsL
parLnershlp,
4. possesses parLnershlp properLy /
asslgns rlghLs ln speclflc parLnershlp
properLy oLher Lhan for parLnershlp
purposes,
3. admlLs person as general parLner,
6. admlLs person as llmlLed parLner -
unless auLhorlzed ln cerLlflcaLe, or
7. conLlnues buslness wlLh parLnershlp
properLy on deaLh, reLlremenL, clvll
lnLerdlcLlon, lnsanlLy or lnsolvency of
general parLner ooless auLhorlzed ln Lhe
cerLlflcaLe.
!"#$%&#'()! $-#$
62 78@? ;< :8@>@ 9 =9>:?@><8;= :B>:A
"2 Where:
1. by any wrongful acL or omlsslon of any
parLner, acLlng ln Lhe ordlnary course of
buslness of Lhe parLnershlp or wlLh
auLhorlLy of hls coparLners, loss ot
lojoty ls caused Lo any person, noL belng
a parLner ln Lhe parLnershlp,
2. one parLner, acLlng wlLhln Lhe scope of
hls apparenL auLhorlLy, recelves money
or properLy from a Lhlrd person, and
mlsopplles lL, or
3. Lhe parLnershlp, ln Lhe course of lLs
buslness, recelves money or properLy,
and lL ls mlsopplleJ by any parLner whlle
lL ls ln Lhe cusLody of Lhe parLnershlp.
%B:@2 ÞarLners are sollJotlly lloble wlLh Lhe
parLnershlp for any penalLy or damage arlslng from a
parLnershlp LorL.
05 #)4($' "%1 -C3)4"$)-%' -. " 3)/)$&1
!"#$%&#
62 789: 9>@ :8@ <=@J;F;J >;N8:< BF 9 D;E;:@K
=9>:?@>A
"2 1o:
1. have parLnershlp books kepL aL prlnclpal
place of buslness,
2. lnspecL/copy books aL reasonable
hours,
!"#$%&#'()!
3. have on demand Lrue and full
lnformaLlon of all Lhlngs affecLlng
parLnershlp,
4. have formal accounL of parLnershlp
affalrs whenever clrcumsLances render
lL [usL and reasonable,
3. ask for dlssoluLlon and wlndlng up by
decree of courL,
6. recelve share of proflLs/oLher
compensaLlon by way of lncome, and
7. recelve reLurn of conLrlbuLlons,
provlded Lhe parLnershlp asseLs are ln
excess of all lLs llablllLles.
62 78B ;< 9 <HM<:;:H:@K D;E;:@K =9>:?@>A
"2 A person admlLLed Lo all Lhe rlghLs of a llmlLed
parLner who has dled or asslgned hls lnLeresL ln
Lhe parLnershlp
62 789: 9>@ :8@ >;N8:< 9?K D;9M;D;:;@< BF 9
<HM<:;:H:@K D;E;:@K =9>:?@>A
"2
4#2 Pe has all Lhe rlghLs and powers and ls
sub[ecL Lo all Lhe resLrlcLlons and llablllLles of
hls asslgnor.
`!%2 1hose llablllLles whlch he was lgnoranL
of aL Lhe Llme LhaL he became a llmlLed
parLner and whlch could noL be ascerLalned
from Lhe cerLlflcaLe
62 789: 9>@ :8@ >@GH;>@E@?:< FB> :8@ 9KE;<<;B?
BF 9 <HM<:;:H:@K D;E;:@K =9>:?@>A
"2
1. All Lhe members musL consenL Lo Lhe
asslgnee becomlng a subsLlLuLed llmlLed
parLner or Lhe llmlLed parLner, belng
empowered by Lhe cerLlflcaLe musL glve
Lhe asslgnee Lhe rlghL Lo become a
llmlLed parLner,
2. 1he cerLlflcaLe musL be amended ln
accordance wlLh ArL. 1863, nCC, and
3. 1he cerLlflcaLe as amended musL be
reglsLered ln Lhe SLC.
62 789: ;< :8@ M9<;< BF =>@F@>@?J@ N;L@? :B
D;E;:@K =9>:?@>< BL@> B:8@> D;E;:@K =9>:?@><A
"2 ÞrlorlLy or preference may be glven Lo some
llmlLed parLners over oLher llmlLed parLners as Lo
Lhe:
1. reLurn of Lhelr conLrlbuLlons,
SSS
2. Lhelr compensaLlon by way of lncome,
or
3. any oLher maLLer.
%B:@2 ln Lhe absence of such sLaLemenL ln Lhe
cerLlflcaLe, eveo lf Lhere ls an agreemenL, all llmlLed
parLners shall sLand on equal fooLlng ln respecL of
Lhese maLLers.
62 789: 9>@ :8@ >@GH;<;:@< FB> >@:H>? BF
JB?:>;MH:;B? BF 9 D;E;:@K =9>:?@>A
"2
1. All llablllLles of Lhe parLnershlp have
been pald or lf Lhey have noL yeL been
pald, Lhe asseLs of Lhe parLnershlp are
sufflclenL Lo pay such llablllLles,
2. 1he consenL of all Lhe members
(general and llmlLed parLners) has been
obLalned except when Lhe reLurn may
be rlghLfully demanded, and
3. 1he cerLlflcaLe of llmlLed parLnershlp ls
cancelled or amended
62 78@? ;< :8@ >@:H>? BF JB?:>;MH:;B? BF 9
D;E;:@K =9>:?@> 9 E9::@> BF >;N8:A
"2 When all llablllLles of Lhe parLnershlp, except
llablllLles Lo general parLners and Lo llmlLed
parLners on accounL of Lhelr conLrlbuLlons, have
been pald or Lhere remalns properLy of Lhe
parLnershlp sufflclenL Lo pay Lhem and Lhe
cerLlflcaLe ls cancelled or so amended as Lo seL
forLh Lhe wlLhdrawal or reducLlon:
1. on Lhe dlssoluLlon of Lhe parLnershlp,
2. upon Lhe arrlval of Lhe daLe speclfled ln
Lhe cerLlflcaLe for Lhe reLurn, or
3. afLer Lhe explraLlon of 6 monLh noLlce ln
wrlLlng glven by hlm Lo Lhe oLher
parLners lf no Llme ls flxed ln Lhe
cerLlflcaLe for Lhe reLurn of Lhe
conLrlbuLlon or for Lhe dlssoluLlon of
Lhe parLnershlp.
%B:@2 Lven lf a llmlLed parLner has conLrlbuLed
properLy, he has only Lhe rlghL Lo demand and
recelve cash for hls conLrlbuLlon. 1he exceptloos are:
1. When Lhere ls sLlpulaLlon Lo Lhe conLrary
ln Lhe cerLlflcaLe, or
2. When all Lhe parLners (general and llmlLed
parLners) consenL Lo Lhe reLurn oLher Lhan
ln Lhe form of cash
62 789: 9>@ :8@ D;9M;D;:;@< BF 9 D;E;:@K =9>:?@>A
T5 $B :8@ =9>:?@><8;=
"2 Slnce llmlLed parLners are noL prlnclpals ln Lhe
LransacLlon of a parLnershlp, Lhelr llablllLy as a
rule, ls Lo Lhe parLnershlp, noL Lo Lhe credlLors of
Lhe parLnershlp. 1he general parLners coooot,
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
SS6
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
however walve any llablllLy of Lhe llmlLed
parLners Lo Lhe pre[udlce of such credlLors.
U5 $B :8@ =9>:?@><8;= J>@K;:B>< 9?K B:8@>
=9>:?@><
2. A llmlLed parLner ls llable for
parLnershlp obllgaLlons when he
conLrlbuLed servlces lnsLead of only
money or properLy Lo Lhe parLnershlp
3. When he allows hls surname Lo appear
ln Lhe flrm name
4. When he falls Lo have a false sLaLemenL
ln Lhe cerLlflcaLe correcLed, knowlng lL
Lo be false
3. When he Lakes parL ln Lhe conLrol of Lhe
buslness
6. When he recelves parLnershlp properLy
as collaLeral securlLy, paymenL,
conveyance, or release ln fraud of
parLnershlp credlLors
7. When Lhere ls fallure Lo subsLanLlally
comply wlLh Lhe legal requlremenLs
governlng Lhe formaLlon of llmlLed
parLnershlps
b5 $B <@=9>9:@ J>@K;:B><
"2 As ln a general parLnershlp, Lhe credlLor of a
llmlLed parLner may, ln addlLlon Lo oLher
remedles allowed under exlsLlng laws, apply Lo
Lhe proper courL for a charglng order sub[ecLlng
Lhe lnLeresL ln Lhe parLnershlp of Lhe debLor
parLner for Lhe paymenL of hls obllgaLlon. (ue
leoo, commeots ooJ coses oo lottoetsblp,
Aqeocy ooJ 1tost, p. 1J, 2005 eJ)
62 789: 9>@ :8@ >@GH;<;:@< FB> O9;L@> B>
JBE=>BE;<@ BF D;9M;D;:;@<A
"2 1he walver or compromlse:
1. ls made wlLh Lhe consenL of all parLners,
and
2. does noL pre[udlce parLnershlp
credlLors who exLended credlL or whose
clalms arose before Lhe cancellaLlon or
amendmenL of Lhe cerLlflcaLe.
62 78@? E9P 9 D;E;:@K =9>:?@> 89L@ :8@
=9>:?@><8;= K;<<BDL@KA
"2
1. When hls demand for Lhe reLurn of hls
conLrlbuLlon ls denled alLhough he has a
rlghL Lo such reLurn, or
2. When hls conLrlbuLlon ls noL pald
alLhough he ls enLlLled Lo lLs reLurn
because Lhe oLher llablllLles of Lhe
parLnershlp have noL been pald or Lhe
parLnershlp properLy ls lnsufflclenL for
Lhelr paymenL.
'*//"#, -. #)4($' "%1 -C3)4"$)-%' -. !"#$%&#'
4&%&#"3 !"#$%&# 3)/)$&1 !"#$%&#
C4DE+-
1. 8lghL ln speclflc parLnershlp properLy
2. lnLeresL ln Lhe parLnershlp (share ln Lhe proflLs and surplus)
3. 8lghL Lo parLlclpaLe ln Lhe managemenL
4. 8lghL Lo assoclaLe anoLher person wlLh hlm ln hls share wlLhouL
Lhe consenL of oLher parLners (subparLnershlp)
3. 8lghL Lo lnspecL and copy parLnershlp books aL any reasonable
hour.
6. 8lghL Lo a formal accounL as Lo parLnershlp affalrs (even durlng
exlsLence of parLnershlp)
a. lf he ls wrongfully excluded from parLnershlp buslness or
possesslon of lLs properLy by hls coparLners.
b. lf rlghL exlsLs under Lhe Lerms of any agreemenL.
c. as provlded ln ArL. 1807, nCC
d. whenever Lhe clrcumsLances render lL [usL and reasonable.
1. 1o have parLnershlp books kepL aL
prlnclpal place of buslness
2. 1o lnspecL/copy books aL reasonable
hours
3. 1o have on demand Lrue and full
lnformaLlon of all Lhlngs affecLlng
parLnershlp
4. 1o have formal accounL of parLnershlp
affalrs whenever clrcumsLances
render lL [usL and reasonable
3. 1o ask for dlssoluLlon and wlndlng up
by decree of courL
6. 1o recelve share of proflLs/oLher
compensaLlon by way of lncome
7. 1o recelve reLurn of conLrlbuLlons,
provlded Lhe parLnershlp asseLs are ln
excess of all lLs llablllLles
"5)4D2+401-
-MD;N9:;B?< BF =9>:?@>< 9EB?N :8@E<@DL@<
1. ConLrlbuLlon of properLy
2. ConLrlbuLlon of money and money converLed Lo personal use
3. ÞrohlblLlon ln engaglng ln buslness for hlmself
4. ConLrlbuLe addlLlonal caplLal
$B :8@ =9>:?@><8;=
Slnce llmlLed parLners are noL prlnclpals ln
Lhe LransacLlon of a parLnershlp, Lhelr
llablllLy as a rule, ls Lo Lhe parLnershlp, noL
Lo Lhe credlLors of Lhe parLnershlp. 1he
!"#$%&#'()!
3. Managlng parLner who collecLs debL
6. ÞarLner who recelves share of parLnershlp credlL
7. uamages Lo parLnershlp
8. 8ender lnformaLlon
9. AccounLable as flduclary
general parLners coooot, however walve
any llablllLy of Lhe llmlLed parLners Lo Lhe
pre[udlce of such credlLors.
-MD;N9:;B?< BF =9>:?@>< :B b
>K
=@><B?<
1. Lvery parLnershlp shall operaLe under a fltm oome. Þersons who
lnclude Lhelr names ln Lhe parLnershlp name even lf Lhey are noL
members shall be llable as a parLner
2. All parLners shall be llable for coottoctool obllqotloos of Lhe
parLnershlp wlLh Lhelr properLy, afLer all parLnershlp asseLs have
been exhausLed:
a. Þro raLa
b. Subsldlary
3. AJmlssloo ot tepteseototloo moJe by ooy pottoet concernlng
parLnershlp affalrs wlLhln Lhe scope of hls auLhorlLy ls evldence
agalnsL Lhe parLnershlp
4. Notlce to pottoet of any maLLer relaLlng Lo parLnershlp affalrs
operaLes as noLlce Lo parLnershlp except ln case of fraud:
a. knowledge of parLner acLlng ln Lhe parLlcular maLLer acqulred
whlle a parLner
b. knowledge of Lhe parLner acLlng ln Lhe parLlcular maLLer Lhen
presenL Lo hls mlnd
c. knowledge of any oLher parLner who reasonably could and
should have communlcaLed lL Lo Lhe acLlng parLner
3. ÞarLners and Lhe parLnershlp are solldarlly llable Lo 3
rd
persons for
Lhe pottoet's tott ot bteocb of ttost
6. lloblllty of locomloq pottoet ls llmlteJ Lo:
a. Pls share ln Lhe parLnershlp properLy for exlsLlng obllgaLlons
b. Pls separaLe properLy for subsequenL obllgaLlons
7. cteJltots of pottoetsblp ote ptefetteJ ln parLnershlp properLy & may
aLLach parLner's share ln parLnershlp asseLs
$B :8@ =9>:?@><8;= J>@K;:B>< 9?K B:8@>
=9>:?@><
1. A llmlLed parLner ls llable for
parLnershlp obllgaLlons when he
conLrlbuLed servlces lnsLead of only
money or properLy Lo Lhe parLnershlp
2. When he allows hls surname Lo
appear ln Lhe flrm name
3. When he falls Lo have a false
sLaLemenL ln Lhe cerLlflcaLe correcLed,
knowlng lL Lo be false
4. When he Lakes parL ln Lhe conLrol of
Lhe buslness
3. When he recelves parLnershlp
properLy as collaLeral securlLy,
paymenL, conveyance, or release ln
fraud of parLnershlp credlLors
6. When Lhere ls fallure Lo subsLanLlally
comply wlLh Lhe legal requlremenLs
governlng Lhe formaLlon of llmlLed
parLnershlps
-:8@> BMD;N9:;B?<
3. uuLy Lo render on demand Lrue and full lnformaLlon affecLlng
parLnershlp Lo any parLner or legal represenLaLlve of any
deceased parLner or of any parLner under legal dlsablllLy.
6. uuLy Lo accounL Lo Lhe parLnershlp as flduclary.
$B <@=9>9:@ J>@K;:B><
As ln a general parLnershlp, Lhe credlLor of
a llmlLed parLner may, ln addlLlon Lo oLher
remedles allowed under exlsLlng laws,
apply Lo Lhe proper courL for a charglng
order sub[ecLlng Lhe lnLeresL ln Lhe
parLnershlp of Lhe debLor parLner for Lhe
paymenL of hls obllgaLlon.
SS7
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
"4&%0,
62 789: ;< JB?:>9J: BF 9N@?JPA
"2 8y conLracL of agency a person blnds hlmself Lo
render some servlce or Lo do someLhlng ln
represenLaLlon or on behalf of anoLher, wlLh Lhe
consenL or auLhorlLy of Lhe laLLer. (Att. 1868 Ncc)
62 789: 9>@ :8@ J89>9J:@>;<:;J< BF 9 JB?:>9J: BF
9N@?JPA
"2 C*%0!!
1. CllaLeral - lf lL ls for compensaLlon
because lL glves rlse Lo reclprocal rlghLs
and obllgaLlons
2. *nllaLeral - lf graLulLous, because lL
creaLes obllgaLlons for only one of Lhe
parLles
3. %omlnaLe
4. 0onsensual - lL ls perfecLed by mere
consenL
3. !rlnclpal
6. !reparaLory - lL ls enLered lnLo as a
means Lo an end
SS8
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
62 789: 9>@ :8@ JD9<<;F;J9:;B?< BF 9N@?JPA
"2
1. As to moooet of cteotloo
a. íxptess - agenL has been acLually
auLhorlzed by Lhe prlnclpal, elLher
orally or ln wrlLlng
b. lmplleJ - agency ls lmplled from
Lhe acLs of Lhe prlnclpal, from hls
sllence or lack of acLlon or hls
fallure Lo repudlaLe Lhe agency,
knowlng LhaL anoLher person ls
acLlng on hls behalf wlLhouL
auLhorlLy
2. As to cbotoctet
a. Ctotoltoos - agenL recelves no
compensaLlon for hls servlces
b. Ooetoos - agenL recelves
compensaLlon for hls servlces
3. As to exteot of bosloess of tbe ptloclpol
a. Ceoetol - agency comprlses all Lhe
buslness of Lhe prlnclpal
b. 5peclol - agency comprlses one or
more speclflc LransacLlons
4. As to ootbotlty coofetteJ
a. coocbeJ lo qeoetol tetms - agency
ls creaLed ln general Lerms and ls
deemed Lo comprlse only acLs ln
Lhe name and represenLaLlon of
Lhe prlnclpal
b. 5lmple ot commlssloo - agenL acLs
ln hls own name buL for Lhe
accounL of Lhe prlnclpal
62 789: 9>@ :8@ @<<@?:;9D @D@E@?:< BF 9?
9N@?JPA
"2 0-#'
1. 0onsenL (express or lmplled) of Lhe
parLles Lo esLabllsh Lhe relaLlonshlp,
2. 1he -b[ecL ls Lhe execuLlon of a [urldlcal
acL ln relaLlon Lo Lhlrd persons,
3. 1he agenL acLs as a #epresenLaLlve and
noL for hlmself, and
4. 1he agenL acLs wlLhln Lhe 'cope of hls
auLhorlLy.
62 ">@ :8@>@ 9?P FB>E9D >@GH;>@E@?:< ;? :8@
9==B;?:E@?: BF 9? 9N@?:A
"2
4#2 1here are no formal requlremenLs
governlng Lhe appolnLmenL of an agenL.
`!%2 When Lhe law requlres a speclflc form.
l.e. - when sale of land or any lnLeresL Lhereln
ls Lhrough an agenL, Lhe auLhorlLy of Lhe laLLer
musL be ln wrlLlng, oLherwlse, Lhe sale shall
be vold (Att. 1874, Ncc)
62 78B 9>@ :8@ =9>:;@< :B 9 JB?:>9J: BF 9N@?JPA
1;<:;?NH;<85
"2
1. ltloclpol - Cne whom Lhe agenL
represenLs and from whom he derlves
auLhorlLy, he ls Lhe one prlmarlly
concerned ln Lhe conLracL.
2. Aqeot - Cne who represenLs Lhe
prlnclpal ln a LransacLlon or buslness.
%B:@2 lrom Lhe Llme Lhe agenL acLs or LransacLs Lhe
buslness for whlch he has been employed ln
represenLaLlon of anoLher, a Lhlrd parLy ls added Lo
Lhe agency relaLlonshlp - Lhe parLy wlLh whom Lhe
buslness ls LransacLed. (ue leoo, commeots ooJ
coses oo lottoetsblp, Aqeocy, ooJ 1tost, p. J52,
2005 eJ)
62 789: ;< :8@ ?9:H>@ BF :8@ >@D9:;B?<8;=
M@:O@@? =>;?J;=9D 9?K 9N@?:A
"2 lL ls flduclary ln naLure LhaL ls based on LrusL
and confldence.
",&%34
62 789: 9>@ :8@ GH9D;F;J9:;B?< BF 9 =>;?J;=9DA
"2
1. naLural or [urldlcal person
2. Pe musL have capaclLy Lo acL
%B:@2 lf a person ls capaclLaLed Lo acL for hlmself or
hls own rlghL, he can acL Lhrough an agenL.
lnsofar as Lhlrd persons are concerned, lL ls enough
LhaL Lhe prlnclpal ls capaclLaLed. 8ot lnsofar as hls
obllgaLlons Lo hls prlnclpal are concerned, Lhe agenL
musL be able Lo blnd hlmself.
62 789: ;< :8@ :@>E iVB;?: =>;?J;=9D<jA
"2 1wo or more persons appolnL an agenL for a
common LransacLlon or underLaklng. (Att. 1915,
Ncc)
62 789: 9>@ :8@ >@GH;<;:@< FB> <BD;K9>P D;9M;D;:P BF
VB;?: =>;?J;=9D<A
"2
1. 1here are Lwo or more prlnclpals,
2. 1hey have all concurred ln Lhe
appolnLmenL of Lhe same agenL, and
3. AgenL ls appolnLed for a common
LransacLlon or underLaklng. (ue leoo, p.
604, 2005 eJ)
62 789: 9>@ :8@ R;?K< BF 9N@?:<A
"2
1. uolvetsol oqeot - one employed Lo do
all acLs whlch Lhe prlnclpal may
personally do, and whlch he can
lawfully delegaLe Lo anoLher Lhe power
of dolng
2. Ceoetol oqeot - one employed Lo
LransacL all buslness of Lhe prlnclpal, or
all Lhe buslness of a parLlcular klnd or ln
a parLlcular place, do all acLs connecLed
wlLh a parLlcular Lrade, buslness or
employmenL
3. 5peclol ot pottlcolot oqeot - one
auLhorlzed Lo do acL ln one or more
speclflc LransacLlons or Lo do one or
more speclflc acLs or Lo acL upon a
parLlcular occaslon
62 09? 9N@?JP M@ J>@9:@K MP ?@J@<<;:PA
"2 no. WhaL ls creaLed ls addlLlonal auLhorlLy ln
an agenL appolnLed and auLhorlzed before Lhe
emergency arose.
SS9
62 789: 9>@ :8@ >@GH;<;:@< FB> :8@ @S;<:@?J@ BF
9N@?JP MP ?@J@<<;:PA
"2
1. 8eal exlsLence of emergency
2. lnablllLy of Lhe agenL Lo communlcaLe
wlLh Lhe prlnclpal
3. Lxerclse of addlLlonal auLhorlLy ls for
Lhe prlnclpal's proLecLlon
4. AdopLlon of falrly reasonable means,
premlses duly consldered
62 789: ;< :8@ >HD@ >@N9>K;?N KBHMD@ 9N@?JPA
"2
4#2 lL ls dlsapproved by law for belng agalnsL
publlc pollcy and sound morallLy.
`!%2 Where Lhe agenL acLed wlLh full
knowledge and consenL of Lhe prlnclpals.
62 " N>9?:@K C :8@ @SJDH<;L@ >;N8: :B <@DD 8;<
M>9?K BF /9B?N =9?:< ;? )<9M@D9Q :8@ =>;J@ FB> 8;<
E@>J89?K;<@ =9P9MD@ O;:8;? hY K9P< F>BE
K@D;L@>PQ 9?K =>BE;<;?N C 9 JBEE;<<;B? BF UY^
B? 9DD <9D@<5 "F:@> :8@ K@D;L@>P BF :8@
E@>J89?K;<@ :B C MH: M@FB>@ 8@ JBHDK <@DD 9?P BF
:8@EQ CW< <:B>@ ;? )<9M@D9 O9< JBE=D@:@DP MH>?@K
O;:8BH: 8;< F9HD:Q :BN@:8@> O;:8 9DD BF "_< =9?:<5
/H<: C =9P " FB> :8@ DB<: =9?:<A 78PA
"2 1he conLracL beLween A and 8 ls a sale noL an
agency Lo sell because Lhe prlce ls payable by 8
upon 60 days from dellvery even lf 8 ls unable Lo
resell lL. lf 8 were an agenL, he ls noL bound Lo
pay Lhe prlce lf he ls unable Lo resell lL. As a
buyer, ownershlp passed Lo 8 upon dellvery and,
under ArL. 1304, nCC, Lhe Lhlng perlshes for Lhe
owner. Pence, 8 musL sLlll pay Lhe prlce. eTZZZ
C9> 6H@<:;B?f
62 )< E@>@ >@=>@<@?:9:;B? BF 9? 9DD@N@K 9N@?:
<HFF;J;@?: :B =>BL@ :8@ @S;<:@?J@ BF 9 =>;?J;=9D
9N@?: >@D9:;B?<8;=A
"2 no. 1he declaraLlons of Lhe agenL alone are
generally lnsufflclenL Lo esLabllsh Lhe facL or
exLenL of agency. lL ls a seLLled rule LhaL Lhe
persons deallng wlLh Lhe assumed agenL are
bound aL Lhelr perll, lf Lhey would hold Lhe
prlnclpals llable, Lo ascerLaln noL only Lhe facL of
agency buL also Lhe naLure and exLenL of
auLhorlLy, and ln case elLher ls conLroverLed, Lhe
burden of proof ls upon Lhem Lo esLabllsh lL.
(5pooses ¥o v. loo Ametlcoo wotlJ Altwoys, loc.,
C.k. No. 12J560, Mot. 27, 2000)
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
62 " FB>@;N? E9?HF9J:H>@> BF JBE=H:@>< 9?K 9
!8;D;==;?@ K;<:>;MH:B> @?:@>@K ;?:B 9 JB?:>9J:
O8@>@MP :8@ K;<:>;MH:B> 9N>@@K :B B>K@> TQYYY
H?;:< BF :8@ E9?HF9J:H>@>_< JBE=H:@>< @L@>P
EB?:8 9?K :B >@<@DD :8@E ;? :8@ !8;D;==;?@< 9:
:8@ E9?HF9J:H>@>_< <HNN@<:@K =>;J@< =DH< TY^5
"DD H?<BDK H?;:< 9: :8@ @?K BF :8@ P@9> <89DD M@
MBHN8: M9JR MP :8@ E9?HF9J:H>@> 9: :8@ <9E@
=>;J@ :8@P O@>@ B>K@>@K5 $8@ E9?HF9J:H>@> <89DD
8BDK :8@ K;<:>;MH:B> F>@@ 9?K 89>ED@<< F>BE 9?P
JD9;E FB> K@F@J:< ;? :8@ H?;:<5 )< :8@ 9N>@@E@?:
B?@ FB> <9D@ B> 9N@?JPA
"2 1he conLracL ls one of agency noL sale. 1he
noLlon of sale ls negaLed by Lhe followlng lndlcla:
(1) Lhe prlce ls flxed by Lhe manufacLurer wlLh Lhe
10° markup consLlLuLlng Lhe commlsslon, (2) Lhe
manufacLurer reacqulres Lhe unsold unlLs aL
exacLly Lhe same prlce, and (3) warranLy for Lhe
unlLs was borne by Lhe manufacLurer. 1he
foregolng lndlcla negaLe sale because Lhey
lndlcaLe LhaL ownershlp over Lhe unlLs was never
lnLended Lo Lransfer Lo Lhe dlsLrlbuLor. eUYYY C9>
6H@<:;B?f
S6u
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
))5 !-7&#'
62 789: 9>@ :8@ R;?K< BF 9N@?JP 9< :B @S:@?: BF
=BO@>< JB?F@>>@KA
"2 Ao oqeocy moy be coocbeJ lo qeoetol tetms ot
coocbeJ lo speclflc tetms.
62 789: ;< 9? 9N@?JP JBHJ8@K ;? N@?@>9D :@>E<A
"2 Cne whlch ls creaLed ln general Lerms and ls
deemed Lo comprlse only acLs of admlnlsLraLlon
(Att. 1877, Ncc).
62 78@? ;< 9? @S=>@<< =BO@> ?@J@<<9>PA
"2 lL ls necessary Lo perform any acL of sLrlcL
ownershlp5
62 789: ;< E@9?: MP 9J:< BF 9KE;?;<:>9:;B?A
"2 1hose whlch do noL lmply Lhe auLhorlLy Lo
allenaLe for Lhe exerclse of whlch an express
power ls necessary.
62 78@? ;< =9PE@?: 9? 9J: BF 9KE;?;<:>9:;B?A
"2 wbeo poymeot ls moJe lo tbe otJlooty cootse
of moooqemeot.
62 78@? 9>@ E9R;?N N;F:< 9? 9J: BF
9KE;?;<:>9:;B?A
"2 1he maklng of cusLomary glfLs for charlLy, or
Lhose made Lo employees ln Lhe buslness
managed by Lhe agenL are consldered acLs of
admlnlsLraLlon.
62 ! N>9?:@K :B " 9 <=@J;9D =BO@> :B EB>:N9N@
:8@ FB>E@>W< >@9D @<:9:@5 CP L;>:H@ BF <9;K =BO@>Q
" <@JH>@K 9 DB9? F>BE 0 <@JH>@K MP 9 EB>:N9N@
B? <9;K >@9D @<:9:@5 )< ! =@><B?9DDP D;9MD@ FB> <9;K
DB9?A
"2 no. A speclal power Lo morLgage properLy ls
llmlLed Lo such auLhorlLy Lo morLgage and does
noL blnd Lhe granLor personally Lo oLher
obllgaLlons conLracLed by Lhe granLee ln Lhe
absence of any raLlflcaLlon or oLher slmllar acL
LhaL would esLop Lhe granLor from quesLlonlng or
dlsownlng such oLher obllgaLlons conLracLed by
Lhe granLee.
"5 $- C)%1 !#)%0)!"3
62 78@? ;< :8@ 9J: BF 9? 9N@?: M;?K;?N :B :8@
=>;?J;=9DA
"2
1. When Lhe agenL acLs as such wlLhouL
expressly blndlng hlmself or does noL
exceed Lhe llmlLs of hls auLhorlLy. (Att.
1897)
2. lf prlnclpal raLlfles Lhe acL of Lhe agenL
whlch exceeded hls auLhorlLy. (Att.
1898)
J. ClrcumsLances where Lhe prlnclpal
hlmself was, or oughL Lo have been
aware. (Att. 1899)
4. lf such acL ls wlLhln Lhe Lerms of Lhe
power of aLLorney, as wrlLLen. (Att.1900
& 1902)
5. Þrlnclpal has raLlfled, or has slgnlfled hls
wllllngness Lo raLlfy Lhe agenL's acL. (Att
1901)
62 1B@< R?BOD@KN@ BF 9 F9J: MP 9? 9N@?: M;?K
:8@ =>;?J;=9DA
"2
4#2 knowledge of agenL ls knowledge of
prlnclpal.
`!%<2
1. AgenL's lnLeresLs are adverse Lo Lhose
of Lhe prlnclpal,
2. AgenL's duLy ls noL Lo dlsclose Lhe
lnformaLlon (cooflJeotlol lofotmotloo),
or
3. Where Lhe person clalmlng Lhe beneflL
of Lhe rule colludes wlLh Lhe agenL Lo
",&%34
S61
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
defraud Lhe prlnclpal. (ue leoo,
commeots ooJ coses oo lottoetsblp,
Aqeocy, ooJ 1tost, p. J67, 2005 eJ)
62 789: 9>@ :8@ @FF@J:< BF :8@ 9J:< BF 9? 9N@?:A
"2
1. wltb auLhorlLy
a. ln prlnclpal's name - valld
b. ln hls own name - noL blndlng on
Lhe prlnclpal, agenL and sLranger
are Lhe only parLles, except
regardlng tbloqs belooqloq to tbe
ptloclpol or when Lhe prlnclpal
totlfles Lhe conLracL or Jetlves
beoeflt Lherefrom
2. wltboot auLhorlLy
a. ln prlnclpal's name - unauLhorlzed
and unenforceable buL may be
raLlfled, ln whlch case, may be
valldaLed reLroacLlvely from Lhe
beglnnlng
b. ln hls own name - valld on Lhe
agenL, bot noL on Lhe prlnclpal
62 789: 9>@ :8@ K;<:;?J:;B?< M@:O@@? 9H:8B>;:P
9?K :8@ =>;?J;=9DW< ;?<:>HJ:;B?<A
"2
"*$(-#)$, )%'$#*0$)-%'
Sum LoLal of Lhe powers
commlLLed Lo Lhe agenL
by Lhe prlnclpal
ConLemplaLes only a
prlvaLe rule of guldance
Lo Lhe agenL,
lndependenL and
dlsLlncL ln characLer
8elaLes Lo Lhe
sub[ecL/buslness wlLh
whlch Lhe agenL ls
empowered Lo deal or
acL
8efers Lo Lhe manner or
mode of agenL's acLlon
LlmlLaLlons of auLhorlLy
are operaLlve as agalnsL
Lhose who have/charged
wlLh knowledge of Lhem
WlLhouL slgnlflcance as
agalnsL Lhose wlLh
nelLher knowledge nor
noLlce of Lhem
ConLemplaLed Lo be
made known Lo Lhlrd
persons deallng wlLh Lhe
agenL
noL expecLed Lo be
made known Lo Lhose
wlLh whom Lhe agenL
deals
62 78@? ;< :8@ =>;?J;=9D MBH?K MP :8@ 9J:H9D B>
9==9>@?: 9H:8B>;:P BF :8@ 9N@?:A
"2 1he prlnclpal ls bound by Lhe acLs of Lhe agenL
on hls behalf, wheLher or noL Lhe Lhlrd person
deallng wlLh Lhe agenL belleves LhaL Lhe agenL has
acLual auLhorlLy, so long as Lhe agenL has acLual
auLhorlLy, express or lmplled.
62 789: ;< KBJ:>;?@ BF 9==9>@?: 9H:8B>;:PA
"2 1he prlnclpal ls llable only as Lo Lhlrd persons
who have been led reasonably Lo belleve by Lhe
conducL of Lhe prlnclpal LhaL such acLual auLhorlLy
exlsLs, alLhough none has been glven.
62 789: 9>@ :8@ K;<:;?J:;B?< M@:O@@? 9==9>@?:
9H:8B>;:P 9?K 9H:8B>;:P MP @<:B==@DA
"2
"==9>@?: "H:8B>;:P "H:8B>;:P MP &<:B==@D
1haL whlch ls Lhough
noL acLually granLed,
Lhe prlnclpal
knowlngly permlLs Lhe
agenL Lo exerclse or
holds hlm ouL as
possesslng
Arlses when Lhe prlnclpal,
by hls culpable negllgence,
permlLs hls agenL Lo
exerclse powers noL
granLed Lo hlm, even
Lhough Lhe prlnclpal may
have no noLlce or
knowledge of Lhe agenL's
conducL
lounded ln consclous
permlsslon of acLs
beyond Lhe powers
granLed
lounded on Lhe prlnclpal's
negllgence ln falllng
properly Lo supervlse Lhe
affalrs of Lhe agenL
62 09? 9? 9N@?: E9;?:9;? 9? 9J:;B? 9N9;?<:
=@><B?< O;:8 O8BE :8@P JB?:>9J:@K B? M@89DF BF
8;< =>;?J;=9DA
"2 no. AgenLs are noL a parLy wlLh respecL Lo LhaL
conLracL beLween hls prlnclpal and Lhlrd persons.
As agenLs, Lhey only render some servlce or do
someLhlng ln represenLaLlon or on behalf of Lhelr
prlnclpals. 1he renderlng of such servlce dld noL
make Lhem parLles Lo Lhe conLracLs of sale
execuLed ln behalf of Lhe laLLer.
1he facL LhaL an agenL who makes a conLracL for
hls prlnclpal wlll galn or suffer loss by Lhe
performance or nonperformance of Lhe conLracL
by Lhe prlnclpal or by Lhe oLher parLy LhereLo
does noL enLlLle hlm Lo malnLaln an acLlon on hls
own behalf agalnsL Lhe oLher parLy for lLs breach.
An agenL enLlLled Lo recelve a commlsslon from
hls prlnclpal upon Lhe performance of a conLracL
whlch he has made on hls prlnclpal's accounL
does noL, from Lhls facL alone, have any clalm
agalnsL Lhe oLher parLy for breach of Lhe conLracL,
elLher ln an acLlon on Lhe conLracL or oLherwlse.
An agenL who ls noL a promlsee cannoL malnLaln
an acLlon aL law agalnsL a purchaser merely
because he ls enLlLled Lo have hls compensaLlon
or advances pald ouL of Lhe purchase prlce before
paymenL Lo Lhe prlnclpal. (uy v. cA, C.k. No.
120465, 5ept. 9, 1999)
+'$ ,-./&% %-$&' 0122
'*//"#, -. #*3&'c "0$' -. "% "4&%$
G1 5(E2)6 06 +E( ./41*4.2)> N4+E41 +E( -*0.( 06 2,+E0/4+8
1. 8lnds prlnclpal,
2. AgenL noL personally llable
K4+E0,+ 0/ 5(801' -*0.( 06 2,+E0/4+8
ConLracL ls ooeofotceoble as agalnsL Lhe prlnclpal bot blnds Lhe agenL Lo Lhe Lhlrd person
8lndlng on Lhe prlnclpal when:
1. 8aLlfled or
2. 1he prlnclpal allowed Lhe agenL Lo acL as Lhough he had full powers
K4+E41 +E( -*0.( 06 2,+E0/4+8 5,+ 41 +E( 2D(1+R- 127(
1. noL blndlng on Lhe prlnclpal,
2. Þrlnclpal has no cause of acLlon agalnsL Lhe 3
rd
parLles and vlce versa
noLe: When Lhe LransacLlon lnvolves Lhlngs belonglng Lo Lhe prlnclpal:
8emedy of Lhe prlnclpal - damages for agenL's fallure Lo comply wlLh Lhe agency
K4+E41 +E( -*0.( 06 +E( N/4++(1 .0N(/ 06 2++0/1(8 5,+ 2D(1+ E2- 9J:H9DDP (A*(('(' E4- 2,+E0/4+8 2**0/'41D
+0 21 ,1'(/-+21'41D 5(+N((1 E47 21' +E( ./41*4.2)
1. lnsofar as 3
rd
persons are concerned (noL requlred Lo lnqulre furLher Lhan Lhe Lerms of Lhe wrlLLen
power, agenL acLed wlLhln scope of hls auLhorlLy,
2. Þrlnclpal esLopped
K4+E 47./0.(/ 70+4I(-
MoLlve ls lmmaLerlal, as long as wlLhln Lhe scope of auLhorlLy, valld
K4+E 74-/(./(-(1+2+401- 58 +E( 2D(1+
1. AuLhorlzed - prlnclpal sLlll llable
2. 8eyond Lhe scope of Lhe agenL's auLhorlLy
4#2 Þrlnclpal noL llable
`!%2 Þrlnclpal Lakes advanLage of a conLracL or recelves beneflLs made under false represenLaLlon of hls
agenL
F4-7212D(7(1+ 06 +E( 5,-41(-- 58 +E( 2D(1+
1. Þrlnclpal sLlll responslble for Lhe acLs conLracLed by Lhe agenL wlLh respecL Lo 3
rd
persons,
2. Þrlnclpal, however, may seek recourse from Lhe agenL
L0/+ *0774++(' 58 +E( 2D(1+
Þrlnclpal clvllly llable so long as Lhe LorL ls commlLLed by Lhe agenL whlle performlng hls duLles ln furLherance
of Lhe prlnclpal's buslness
3D(1+ 41 D00' 624+E 5,+ ./(S,'4*(- T
/'
.2/+4(-
Þrlnclpal ls llable for damages
S62
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
C5 &`0&!$)-%
62 78@? ;< :8@ 9J: BF 9? 9N@?: ?B: M;?K;?N :B :8@
=>;?J;=9DA
"2 lf an agenL acLs ln hls own name. ln such case,
Lhe agenL ls Lhe one dlrecLly bound ln favor of Lhe
person wlLh whom he has conLracLed, as lf Lhe
LransacLlon were hls own. (Att. 188J, Ncc)
",&%34
)))5 &`!#&'' +'5 )/!3)&1 "4&%0,
62 1;<:;?NH;<8 @S=>@<< 9?K ;E=D;@K 9N@?JP5
S6S
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
"2
&`!#&'' "4&%0, )/!3)&1 "4&%0,
3- +0 '(6414+401
Cne where Lhe agenL
has been acLually
auLhorlzed by Lhe
prlnclpal, elLher orally
or ln wrlLlng
Cne whlch ls lmplled from
Lhe acLs of Lhe prlnclpal,
3- +0 2,+E0/4+8
When lL ls dlrecLly
conferred by words
When lL ls lncldenLal Lo Lhe
LransacLlon or reasonably
necessary Lo accompllsh Lhe
purpose of Lhe agency, and
Lherefore, Lhe prlnclpal ls
deemed Lo have acLually
lnLended Lhe agenL Lo
possess
62 1;<:;?NH;<8 9N@?JP F>BE NH9>K;9?<8;=5
"2
"4&%0, 4*"#1)"%'()!
AgenL represenLs a
capaclLaLed person
Cuardlan represenLs an
lncapaclLaLed person
AgenL derlves
auLhorlLy from Lhe
prlnclpal
Cuardlan derlves auLhorlLy
from Lhe courL
AgenL ls appolnLed by
Lhe prlnclpal and can
be removed by Lhe
laLLer
Cuardlan ls appolnLed by
Lhe courL, and sLands ln
loco parenLls
AgenL ls sub[ecL Lo
dlrecLlons of Lhe
prlnclpal
4H9>K;9? ;< 10+ <HMV@J: :B
:8@ K;>@J:;B?< BF :8@ O9>KQ
MH: EH<: 9J: FB> :8@ O9>KW<
M@?@F;:
AgenL can make Lhe
prlnclpal personally
llable
4H9>K;9? 89< ?B =BO@> :B
;E=B<@ =@><B?9D D;9M;D;:P
B? :8@ O9>K
62 1;<:;?NH;<8 9N@?JP F>BE VHK;J;9D
9KE;?;<:>9:;B?5
"2
"4&%0, I*1)0)"3 "1/)%)'$#"$)-%
AgenL ls appolnLed
by Lhe prlnclpal
!udlclal AdmlnlsLraLor ls
appolnLed by Lhe courL
8epresenLs Lhe
prlnclpal
8epresenLs noL only Lhe
courL buL also Lhe helrs and
credlLors of Lhe esLaLe
AgenL does noL flle
a bond
!udlclal AdmlnlsLraLor flles a
bond
AgenL ls conLrolled
by Lhe prlnclpal
Lhru Lhe agreemenL
Pls acLs are sub[ecL Lo
speclflc orders from Lhe
courL
62 1;<:;?NH;<8 9N@?JP F>BE D@9<@ BF <@>L;J@<5
"2
"4&%0, 3&"'& -. '&#+)0&'
3D(1+ /(./(-(1+- +E(
./41*4.2)
Worker or lessor of
servlces does noL
represenL hls employer
8elaLlonshlp can be
LermlnaLed aL Lhe wlll
of elLher prlnclpal or
agenL
Cenerally, relaLlonshlp
can be LermlnaLed only
aL Lhe wlll of boLh
AgenL exerclses
dlscreLlonary powers
Lmployee has mlnlsLerlal
funcLlons
62 1;<:;?NH;<8 9N@?JP F>BE :>H<:5
3P
"4&%0, $#*'$
3D(1+ ,-,2))8 E0)'-
10 +4+)( 2+ 2))
1rusLee may hold legal
LlLle Lo Lhe properLy
3D(1+ ,-,2))8 2*+- 41
+E( 127( 06 +E(
./41*4.2)
1rusLee may acL ln hls
own name
3D(1*8 ,-,2))8 728
5( +(/7412+(' 0/
/(I0U(' 218 +47(
1rusL usually ends by Lhe
accompllshmenL of Lhe
purposes for whlch lL was
formed
Agency may noL be
connecLed aL all wlLh
properLy
1rusL lnvolves conLrol
over properLy
3D(1+ E2- 2,+E0/4+8
+0 72U( *01+/2*+-
NE4*E N4)) 5( 541'41D
01 E4- ./41*4.2)
1rusLee does noL
necessarlly or even
possess such auLhorlLy Lo
blnd Lhe LrusLor or Lhe
cesLul que LrusL
3D(1*8 4- /(2))8 2
*01+/2*+,2) /()2+401
1rusL may be Lhe resulL of
a conLracL, lL may also be
creaLed by law
)+5 "4&%0, C, &'$-!!&3
62 78@? ;< :8@>@ 9? 9N@?JP MP @<:B==@DA
"2 When one leads anoLher Lo belleve LhaL a
cerLaln person ls hls agenL, when as a maLLer of
facL such ls noL Lrue, and Lhe laLLer acLs on such
mlsrepresenLaLlon, Lhe former cannoL dlsclalm
llablllLy, for he has creaLed an agency by estoppel.
(lotos, clvll coJe of tbe lblllpploes AooototeJ,
vol. v, p. 558, 6
tb
eJ)
62 789: 9>@ :8@ >HD@< >@N9>K;?N @<:B==@D ;?
9N@?JPA
"2
1. LsLoppel of agenL - Ooe ptofessloq to
oct os oqeot fot oootbet moy be
+'$ ,-./&% %-$&' 0122
S64
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
estoppeJ to Jeoy bls oqeocy botb os
oqolost bls ossetteJ ptloclpol ooJ tbe
tbltJ petsoos lotetesteJ lo tbe
ttoosoctloo lo wblcb be eoqoqeJ.
2. ístoppel of ptloclpol
a. As Lo agenL - Ooe wbo koows tbot
oootbet ls octloq os bls oqeot ooJ
folls to tepoJlote bls octs, ot
occepts tbe beoeflts, wlll be
estoppeJ to Jeoy tbe oqeocy os
oqolost tbe otbet.
b. As Lo subagenL - 1o estop tbe
ptloclpol ftom Jeoyloq bls lloblllty
to o tbltJ petsoo, be most bove
koowo ot be cbotqeJ wltb
koowleJqe of tbe foct of tbe
ttoosoctloo ooJ tbe tetms of tbe
oqteemeot betweeo tbe oqeot ooJ
soboqeot.
c. As Lo Lhlrd persons - Ooe wbo
koows tbot oootbet ls octloq os bls
oqeot ot petmltteJ oootbet to
oppeot os bls oqeot, to tbe lojoty of
tbltJ petsoos wbo bove Jeolt wltb
tbe oppoteot oqeot os socb lo qooJ
foltb ooJ lo tbe exetclse of
teosoooble ptoJeoce, ls estoppeJ
to Jeoy tbe oqeocy.
3. ístoppel of tbltJ petsoos - A tbltJ
petsoo, bovloq Jeolt wltb ooe os oqeot
moy be estoppeJ to Jeoy tbe oqeocy os
oqolost tbe ptloclpol, oqeot, ot tbltJ
petsoos lo lotetest.
4. ístoppel of tbe qovetomeot - 1be
qovetomeot ls oeltbet estoppeJ by tbe
mlstoke ot ettot oo tbe pott of lts
oqeots.
62 1;<:;?NH;<8 ;E=D;@K 9N@?JP F>BE 9N@?JP MP
@<:B==@D5
A.
)/!3)&1 "4&%0, "4&%0, C, &'$-!!&3
3- +0 )4254)4+8 5(+N((1 ./41*4.2) 21' 2D(1+
AgenL ls a Lrue agenL,
wlLh rlghLs and duLles
of an agenL
lf caused by Lhe ºagenL", he
ls noL consldered a Lrue
agenL, hence, he has no
rlghLs as such
3- +0 )4254)4+8 +0 +E4/' .(/-01-
1. 1he prlnclpal ls
always llable
2. 1he agenL ls never
personally llable
1. lf cooseJ by tbe
ptloclpol, he ls llable,
buL only lf Lhe 3
rd
person acLed on Lhe
mlsrepresenLaLlon,
2. lf cooseJ by tbe oqeot
olooe, only Lhe agenL ls
llable
+5 4&%&#"3 L<5 '!&0)"3 "4&%0,
62 1;<:;?NH;<8 9 N@?@>9D 9N@?: F>BE 9 <=@J;9D
9N@?:A
"2
4@?@>9D "N@?: '=@J;9D "N@?:
M*0.( 06 3,+E0/4+8
All acLs connecLed wlLh
Lhe buslness or
employmenL ln whlch he
ls engaged
Speclflc acLs ln
pursuance of parLlcular
lnsLrucLlons or wlLh
resLrlcLlons necessarlly
lmplled from Lhe acL Lo
be done
#2+,/( 06 M(/I4*( 3,+E0/4V('
lnvolves conLlnulLy of
servlce
no conLlnulLy of servlce
@A+(1+ +0 NE4*E +E( 3D(1+ 728 !41' +E( %/41*4.2)
May blnd hls prlnclpal by
an acL wlLhln Lhe scope
of hls auLhorlLy alLhough
lL may be conLrary Lo Lhe
laLLer's speclal
lnsLrucLlons
CannoL blnd hls prlnclpal
ln a manner beyond or
ouLslde Lhe speclflc acLs
whlch he ls auLhorlzed Lo
perform
L(/7412+401 06 3,+E0/4+8
ApparenL auLhorlLy does
noL LermlnaLe by mere
revocaLlon of hls
auLhorlLy wlLhouL noLlce
Lo Lhe Lhlrd parLy
uuLy lmposed upon Lhe
Lhlrd parLy Lo lnqulre
makes LermlnaLlon of Lhe
relaLlonshlp effecLlve
upon revocaLlon
$01-+/,*+401 06 %/41*4.2)R- G1-+/,*+401
Merely advlsory ln
naLure
SLrlcLly consLrued as Lhey
llmlL Lhe agenL's
auLhorlLy
62 78B ;< 9 F9J:B>aJBEE;<<;B? 9N@?:A
"2 lL ls one eoqoqeJ ln Lhe purchase and sale of
personal properLy for a prlnclpal, whlch, for Lhls
purpose, has Lo be placed ln hls possesslon and aL
hls dlsposal.
62 78B ;< 9 M>BR@>A
"2 Pe ls a mlddleman or lnLermedlary who ln
behalf of oLhers and for a commlsslon or fee
oeqotlotes conLracLs/LransacLlons relaLlng Lo real
or personal properLy.
62 789: ;< F9J:B>9N@A
"2 lL ls Lhe compensaLlon of a facLor or
commlsslon agenL.
",&%34
62 789: ;< B>K;?9>P JBEE;<<;B?A
"2 lL ls Lhe compensaLlon for Lhe sale of goods
whlch are placed ln Lhe agenL's possesslon or aL
hls dlsposal
62 789: ;< NH9>9?:P JBEE;<<;B?A
"2 lL ls Lhe fee whlch ls glven ln reLurn for Lhe rlsk
LhaL Lhe agenL has Lo bear ln Lhe collecLlon of
credlLs.
S6S
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+)5 "4&%0, 0-*0(&1 )% 4&%&#"3 $&#/'
62 789: ;< 9? 9N@?JP JBHJ8@K ;? N@?@>9D :@>E<A
"2 Cne whlch ls creaLed ln general Lerms and ls
deemed Lo comprlse only acLs of admlnlsLraLlon
(Att. 1877, Ncc).
+))5 "4&%0, #&6*)#)%4 '!&0)"3 !-7&# -.
"$$-#%&,
62 789: ;< <=@J;9D =BO@> BF 9::B>?@P e'!"fA
"2 lL ls an lnsLrumenL ln wrlLlng by whlch one
person, as prlnclpal, appolnLs anoLher as hls agenL
and confers upon hlm Lhe auLhorlLy Lo perform
cerLaln speclfled acLs or klnds of acLs on behalf of
Lhe prlnclpal, prlmary purpose ls Lo evldence
agenL's auLhorlLy Lo Lhlrd parLles wlLhln whom
Lhe agenL deals.
62 '8BHDK '!" M@ ;? O>;:;?N 9?K ?B:9>;[@K ;?
B>K@> :B M@ L9D;KA
": no. SÞA ls noL requlred Lo be ln wrlLlng and
need noL be noLarlzed ln order Lo be valld. (ue
leoo, commeots ooJ coses oo lottoetsblp,
Aqeocy, ooJ 1tost, p. 44J, 2005 eJ)
62 )< :8@ ;?:@>L@?:;B? BF 9 ?B:9>P =HMD;J >@GH;>@K
FB> :8@ L9D;K;:P BF 9? '!"A
"2
4#2 A power of aLLorney ls valld alLhough no
noLary publlc lnLervened ln lLs execuLlon.
(8ottetto v. 1oosoo, C.k. Nos. lJ6811, J6827,
J6840, J6872, Mot. J1, 19J4) (ue leoo, p.
44J, 2005 eJ)
`!%2 When SÞA ls execuLed ln a forelgn
counLry, lL musL be cerLlfled and
auLhenLlcaLed accordlng Lo Lhe 8ules of CourL,
parLlcularly Sec. 23, 8ule 132.
%B:@2 When Lhe speclal power of aLLorney ls
execuLed and acknowledged before a noLary publlc
or oLher compeLenL offlclal ln a forelgn counLry, lL
cannoL be admlLLed ln evldence unless lL ls cerLlfled
as such ln accordance wlLh Lhe foregolng provlslon
of Lhe rules by a secreLary of embassy or legaLlon,
consul general, consul, vlce consul, or consular agenL
or by any offlcer ln Lhe forelgn servlce of Lhe
Þhlllpplnes sLaLloned ln Lhe forelgn counLry ln whlch
Lhe record ls kepL of sald publlc documenL and
auLhenLlcaLed by Lhe seal of hls offlce. (MeJloo v.
NotlvlJoJ, C.k. No. 177505, Nov. 27, 2008)
1he fallure Lo have Lhe speclal power of aLLorney
(execuLed ln a forelgn counLry) auLhenLlcaLed ls noL
merely a LechnlcallLy - lL ls a quesLlon of [urlsdlcLlon.
!urlsdlcLlon over Lhe person of Lhe real parLyln
lnLeresL was never acqulred by Lhe courLs. (lblJ.)
62 78@? ;< 9 <=@J;9D =BO@> ?@J@<<9>PA
"2 0"33 /- '!#)%4 0-7
1. Lo 0reaLe or convey real rlghLs over
lmmovable properLy,
2. Convey or "cqulre lmmovable
3. Lo 3oan or borrow money, unless Lhe
laLLer acL be urgenL and lndlspensable
for Lhe preservaLlon of Lhe Lhlngs whlch
are under admlnlsLraLlon,
4. Lo 3ease any real properLy Lo anoLher
person for more Lhan one year,
3. Lo /ake such !aymenLs as are noL
usually consldered as acLs of
admlnlsLraLlon,
6. Lo -bllgaLe prlnclpal as guaranLor or
sureLy
7. Lo blnd Lhe prlnclpal Lo render some
'ervlce wlLhouL compensaLlon,
8. Lo blnd Lhe prlnclpal ln a conLracL of
!arLnershlp,
9. Lo #aLlfy obllgaLlons conLracLed before
Lhe agency
10. Lo AccepL or repudlaLe an )nherlLance
11. LffecL %ovaLlon
12. Lo make 4lfLs, excepL cusLomary ones
for charlLy or Lhose made Lo employees
ln Lhe buslness managed by Lhe agenL
13. 0ompromlse, ArblLraLlon and
Confesslon of !udgmenL
14. any -Lher acL of sLrlcL domlnlon
13. 7alve an obllgaLlon graLulLously
62 789: 9>@ :8@ D;E;:9:;B?< :B 9 <=@J;9D =BO@> BF
9::B>?@PA
"2
1. A speclal power Lo sell excludes Lhe
power Lo morLgage
2. A speclal power Lo morLgage does oot
lnclude Lhe power Lo sell (Att. 1879,
Ncc)
+'$ ,-./&% %-$&' 0122
3. A speclal power Lo compromlse does
oot auLhorlze submlsslon Lo arblLraLlon
(Att. 1880, Ncc)
S66
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
+)))5 "4&%0, C, -!&#"$)-% -. 3"7
62 78@? ;< 9? 9N@?JP J>@9:@K MP B=@>9:;B? BF
D9OA
"2 When Lhe agenL wlLhdraws from Lhe agency
for a valld reason, he musL conLlnue Lo acL unLll
Lhe prlnclpal has had a reasonable opporLunlLy Lo
Lake Lhe necessary sLeps llke Lhe appolnLmenL of
a new agenL Lo remedy Lhe slLuaLlon caused by
Lhe wlLhdrawal. (Att. 1929, Ncc)
)`5 #)4($' "%1 -C3)4"$)-%' -. !#)%0)!"3
62 789: 9>@ :8@ BMD;N9:;B?< BF :8@ =>;?J;=9D :B
:8@ 9N@?:A
"2 1o:
1. comply wlLh all obllgaLlons whlch Lhe
agenL may have conLracLed wlLhln Lhe
scope of hls auLhorlLy (Att. 1910, Ncc),
2. advance Lo Lhe agenL, should Lhe laLLer
so requesL, Lhe sums necessary for Lhe
execuLlon of Lhe agency (Att. 1912,
Ncc),
3. relmburse Lhe agenL for all advance
made by hlm, provlded Lhe agenL ls free
from faulL (lblJ.),
4. lndemnlfy Lhe agenL for all damages
whlch Lhe execuLlon of Lhe agency may
have caused Lhe laLLer wlLhouL faulL or
negllgence on hls parL (Att. 191J, Ncc),
and
3. pay Lhe agenL Lhe compensaLlon agreed
upon, or lf no compensaLlon was
speclfled, Lhe reasonable value of Lhe
agenL's servlces. (ue leoo, commeots
ooJ coses oo lottoetsblp, Aqeocy, ooJ
1tost, pp. 545555, 2005 eJ)
62 )< :8@ =>;?J;=9D D;9MD@ FB> :8@ @S=@?<@<
;?JH>>@K MP :8@ 9N@?:A
"2
4#2 ?es.
`!%<2
1. lf Lhe agenL acLed ln conLravenLlon of
Lhe prlnclpal's lnsLrucLlons, ooless
prlnclpal derlves beneflLs from Lhe
conLracL,
2. When Lhe expenses were due Lo Lhe
faulL of Lhe agenL,
3. When Lhe agenL lncurred Lhem wlLh
knowledge LhaL an unfavorable resulL
would ensue, lf Lhe prlnclpal was noL
aware Lhereof, or
4. When lL was sLlpulaLed LhaL Lhe
expenses would be borne by Lhe agenL,
or LhaL Lhe laLLer would be allowed only
a cerLaln sum.
62 789: ;< :8@ D;9M;D;:P BF :8@ =>;?J;=9D >@N9>K;?N
JB?:>9J:< @?:@>@K ;?:B MP :8@ 9N@?:A
"2
4#2 1he prlnclpal musL comply wlLh all Lhe
obllgaLlons whlch Lhe agenL may have
conLracLed wlLhln Lhe scope of hls auLhorlLy.
`!%2 Where Lhe agenL exceeded hls auLhorlLy.
`!% :B :8@ `!%2 When Lhe prlnclpal raLlfles lL.
%B:@2 Lven lf Lhe agenL has exceeded hls auLhorlLy,
Lhe prlnclpal ls solldarlly llable wlLh Lhe agenL lf Lhe
former allowed Lhe laLLer Lo acL as Lhough he had full
powers (Att. 1911, Ncc)
62 0` @S@JH:@K 9 <=@J;9D =BO@> BF 9::B>?@P
9H:8B>;[;?N 1, :B <@JH>@ 9 DB9? F>BE 9?P M9?R
9?K :B EB>:N9N@ 8;< =>B=@>:P JBL@>@K MP :8@
BO?@>W< J@>:;F;J9:@ BF :;:D@5 )? <@JH>;?N 9 DB9?
F>BE / C9?RQ 1, K;K ?B: <=@J;FP :89: 8@ O9<
9J:;?N FB> 0` ;? :8@ :>9?<9J:;B? O;:8 :8@ M9?R5 )<
0` D;9MD@ FB> :8@ M9?R DB9?A
"2 Whlle as a general rule Lhe prlnclpal ls noL
llable for Lhe conLracL enLered lnLo by hls agenL ln
case Lhe agenL acLed ln hls own name wlLhouL
dlscloslng hls prlnclpal, such rule does noL apply lf
Lhe conLracL lnvolves a Lhlng belonglng Lo Lhe
prlnclpal. ln such case, Lhe prlnclpal ls llable under
ArL. 1883, nCC. 1he conLracL ls deemed made ln
hls behalf. (5yIoco v. 5yIoco, C.k. No. l1J471,
Ioo. 12, 1920) eUYYk C9> 6H@<:;B?f
62 789: ;< :8@ D;9M;D;:P BF :8@ =>;?J;=9D FB> :B>:
JBEE;::@K MP :8@ 9N@?:A
"2
4#2 Where Lhe faulL or crlme commlLLed by
Lhe agenL ls noL ln Lhe performance of an
obllgaLlon of Lhe prlnclpal, Lhe laLLer ls noL
bound by Lhe llllclL acLs of Lhe agenL, even lf lL
ls done ln connecLlon wlLh Lhe agency.
`!%<2
1. Where Lhe LorL was commlLLed by Lhe
agenL because of defecLlve lnsLrucLlons
from Lhe prlnclpal or due Lo lack of
",&%34
necessary vlgllance or supervlslon on hls
parL, or
2. When Lhe LorL conslsLs ln Lhe
performance of an acL whlch ls wlLhln
Lhe powers of an agenL buL becomes
crlmlnal only because of Lhe manner ln
whlch Lhe agenL has performed lL, Lhe
prlnclpal ls clvllly llable Lo 3rd persons
who acLed ln good falLh.
62 78@? ;< :8@ =>;?J;=9D ?B: MBH?K MP :8@ 9J: BF
:8@ 9N@?:A
"2
1. 4#2 When Lhe acL ls wlLhouL or beyond
Lhe scope of hls auLhorlLy ln Lhe
prlnclpal's name.
`!%<:
a. Where Lhe acLs of Lhe prlnclpal
have conLrlbuLed Lo decelve a 3
rd
person ln good falLh
b. Where Lhe llmlLaLlon upon Lhe
power creaLed by Lhe prlnclpal
could noL have been known by Lhe
3
rd
person
c. Where Lhe prlnclpal has placed ln
Lhe hands of Lhe agenL lnsLrumenLs
slgned by hlm ln blank
d. Where Lhe prlnclpal has raLlfled
Lhe acLs of Lhe agenL
2. When Lhe acL ls wlLhln Lhe scope of Lhe
agenL's auLhorlLy buL ln hls own name,
excepL when Lhe LransacLlon lnvolves
Lhlngs belonglng Lo Lhe prlnclpal.
%B:@2 1he llmlLs of Lhe agenL's auLhorlLy shall noL be
consldered exceeded should lL have been performed
ln a manner more advanLageous Lo Lhe prlnclpal
Lhan LhaL speclfled by hlm.
#&'!-%')C)3)$)&' "%1 -C3)4"$)-%' -. "%
"4&%$
62 789: 9>@ :8@ <=@J;F;J BMD;N9:;B?< BF 9? 9N@?:
:B :8@ =>;?J;=9DA
"2 0".-."%"3"1#)!C)#
1. 0arry ouL Lhe agency whlch he has
accepLed
2. "nswer for damages whlch Lhrough hls
nonperformance Lhe prlnclpal may
suffer
3. .lnlsh Lhe buslness already begun on
Lhe deaLh of Lhe prlnclpal should delay
enLall any danger
S67
4. -bserve Lhe dlllgence of a good faLher
of a famlly ln Lhe cusLody and
preservaLlon of Lhe goods forwarded Lo
hlm by Lhe owner ln case he decllnes an
agency, unLll an agenL ls appolnLed (Att.
1885, Ncc)
3. advance Lhe necessary .unds should
Lhere be a sLlpulaLlon Lo do so (Att.
1886, Ncc)
6. "cL ln accordance wlLh Lhe lnsLrucLlons
of Lhe prlnclpal, and ln defaulL Lhereof,
Lo do all LhaL a good faLher of a famlly
would do (Att. 1887, Ncc)
7. %oL Lo carry ouL Lhe agency of lLs
execuLlon would manlfesLly resulL ln
loss or damage Lo Lhe prlnclpal (Att.
1888, Ncc)
8. "nswer for damages lf Lhere belng a
confllcL beLween hls lnLeresLs and Lhose
of Lhe prlnclpal, he should prefer hls
own (Att. 1889, Ncc)
9. noL Lo 3oan Lo hlmself lf he has been
auLhorlzed Lo lend money aL lnLeresL
(Att. 1890, Ncc)
10. render an "ccounL of hls LransacLlons
and Lo dellver Lo Lhe prlnclpal whaLever
he may have recelved by vlrLue of Lhe
agency (Att. 1891, Ncc)
11. 1lsLlngulsh goods by counLermarks and
deslgnaLe Lhe merchandlse respecLlvely
belonglng Lo each prlnclpal, ln Lhe case
of a commlsslon agenL who handles
goods of Lhe same klnd and mark, whlch
belong Lo dlfferenL owners (Att. 1904,
Ncc)
12. be #esponslble ln cerLaln cases for Lhe
acLs of Lhe subsLlLuLe appolnLed by hlm
(Att. 1890, Ncc)
13. !ay lnLeresL on funds he has applled Lo
hls own use (Att. 1896, Ncc)
14. )nform Lhe prlnclpal, where an
auLhorlzed sale of credlL has been
made, of such sale (Att. 1906, Ncc)
13. Cear Lhe rlsk of collecLlon and pay Lhe
prlnclpal Lhe proceeds of Lhe sale on Lhe
same Lerms agreed upon wlLh Lhe
purchaser, should he recelve also on
sale, a guaranLee commlsslon (Att.
1907, Ncc)
16. )ndemnlfy Lhe prlnclpal for damages for
hls fallure Lo collecL Lhe credlLs of hls
prlnclpal aL Lhe Llme LhaL Lhey become
due (Att. 1908, Ncc)
17. be #esponslble for fraud or negllgence
(Att. 1909, Ncc, ue leoo, commeots
ooJ coses oo lottoetsblp, Aqeocy, ooJ
1tost, pp. 478479, 2005 eJ)
%B:@2 Lvery sLlpulaLlon exempLlng Lhe agenL from
Lhe obllgaLlon Lo render an accounL shall be vold
(pot. 2, Att. 1891, Ncc)
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
62 )? J9<@ BF M>@9J8 BF DBP9D:PQ ;< :8@ 9N@?: <:;DD
@?:;:D@K :B JBEE;<<;B?A
"2 no, 1he forfelLure of Lhe commlsslon wlll Lake
place regardless of wheLher Lhe prlnclpal suffers
any ln[ury by reason of such breach of loyalLy. lL
does noL even maLLer lf Lhe agency ls for a
graLulLous one, or LhaL Lhe prlnclpal obLalned
beLLer resulLs, or LhaL usage and cusLoms allow a
recelpL of such a bonus.
%B:@2 An agenL has an absoluLe duLy Lo make a full
dlsclosure or accounLlng Lo hls prlnclpal of all
LransacLlons and maLerlal facLs LhaL may have some
relevance wlLh Lhe agency. (uomloqo v. uomloqo,
C.k. No. lJ057J, Oct. 29, 1971)
62 78@? ;< :8@ BMD;N9:;B? :B 9JJBH?: ?B:
9==D;J9MD@A
"2
1. lf Lhe agenL acLed only as a mlddleman
wlLh Lhe Lask of merely brlnglng
LogeLher Lhe vendor and vendees,
2. lf Lhe agenL lnformed Lhe prlnclpal of
Lhe glfL/bonus/proflL he recelved from
Lhe purchaser and hls prlnclpal dld noL
ob[ecL LhereLo, or
3. Where a rlghL of llen exlsLs ln favor of
Lhe agenL.
62 789: ;< :8@ >@<=B?<;M;D;:P BF :OB B> EB>@
9N@?:< 9==B;?:@K <;EHD:9?@BH<DPA
"2
4#2 !olnLly llable.
`!%2 SolldarlLy has been expressly sLlpulaLed.
Lach of Lhe agenLs becomes solldarlly llable
for:
1. Lhe nonfulflllmenL of Lhe agency, or
2. faulL or negllgence of hls fellow agenL.
`!% :B :8@ `!%2 When one of Lhe oLher
agenLs acLs beyond Lhe scope of hls auLhorlLy
- lnnocenL agenL ls oot llable.
%B:@2 An lnnocenL agenL has a rlghL laLer on Lo
recover from Lhe gullLy or negllgenL agenL.
62 789: ;< :8@ >HD@ O;:8 >@N9>K :B :8@ @S@JH:;B?
BF :8@ 9N@?JPA
"2
4#2 1he agenL ls bound by hls accepLance Lo
carry ouL Lhe agency, and ls llable for damages
whlch, Lhrough hls nonperformance, Lhe
prlnclpal may suffer.
S68
`!%2 lf lLs execuLlon could manlfesLly resulL ln
loss or damage Lo Lhe prlnclpal
62 789: 9>@ :8@ ;?<:9?J@< O8@? :8@ 9N@?: E9P
;?JH> =@><B?9D D;9M;D;:PA
"2
1. AgenL expressly bound hlmself,
2. AgenL exceeds hls auLhorlLy,
3. AcLs of Lhe agenL prevenL Lhe
performance on Lhe parL of Lhe
prlnclpal,
4. When a person acLs as agenL wlLhouL
auLhorlLy or wlLhouL a prlnclpal, or
3. A person who acLs as an agenL of an
lncapaclLaLed prlnclpal unless Lhe Lhlrd
person was aware of Lhe lncapaclLy aL
Lhe Llme of Lhe maklng of Lhe conLracL.
62 789: ;< :8@ <JB=@ BF :8@ 9N@?:W< 9H:8B>;:P 9<
:B :8;>K =@><B?<A
"2 lL lncludes noL only Lhe acLual auLhorlzaLlon
conferred upon Lhe agenL by hls prlnclpal buL also
LhaL whlch ls apparenL or lmplledly delegaLed Lo
hlm.
62 )< :8@ :8;>K =@><B? >@GH;>@K :B ;?GH;>@ ;?:B
:8@ 9H:8B>;:P BF :8@ 9N@?:A
"2
1. wbete ootbotlty ls oot lo wtltloq - Lvery
person deallng wlLh an assumed agenL
musL dlscover upon hls perll, lf he
would hold Lhe prlnclpal llable, noL only
Lhe facL of Lhe agency buL Lhe naLure
and exLenL of Lhe auLhorlLy of Lhe
agenL.
2. wbete ootbotlty ls lo wtltloq - 3rd
person ls noL requlred Lo lnqulre furLher
Lhan Lhe Lerms of Lhe wrlLLen power of
aLLorney.
%B:@2 A Lhlrd person wlLh whom Lhe agenL wlshes Lo
conLracL on behalf of Lhe prlnclpal may requlre Lhe
presenLaLlon of Lhe power of aLLorney or Lhe
lnsLrucLlons as regards Lhe agency.
62 789: ;< :8@ >HD@ O;:8 >@N9>K :B :8@
9KL9?J@E@?: BF FH?K< MP :8@ 9N@?:A
"2
4#2 1here musL be a sLlpulaLlon ln Lhe
conLracL LhaL Lhe agenL shall advance Lhe
necessary funds
`!%2 When Lhe prlnclpal ls lnsolvenL.
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
",&%34
#)4($' -. "4&%$'
62 789: 9>@ :8@ ;?<:9?J@< O8@? :8@ 9N@?: E9P
>@:9;? ;? =D@KN@ :8@ BMV@J: BF :8@ 9N@?JPA
"2
1. lf prlnclpal falls Lo relmburse Lhe agenL
Lhe necessary sums, lncludlng lnLeresL,
whlch Lhe laLLer advanced for Lhe
execuLlon of Lhe agency (Att. 1912,
Ncc), or
S69
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
2. lf prlnclpal falls Lo lndemnlfy Lhe agenL
for all damages whlch Lhe execuLlon of
Lhe agency may have caused Lhe laLLer,
wlLhouL faulL or negllgence on hls parL.
(Att. 191J, Ncc)
62 789: ;< :8@ >HD@ O8@>@ :OB =@><B?< K@9D
<@=9>9:@DP O;:8 :8@ 9N@?: 9?K :8@ =>;?J;=9DA
"2 lf Lhe Lwo conLracLs are lncompaLlble wlLh each
oLher, Lhe one of prlor daLe shall be preferred.
1hls ls sub[ecL however Lo Lhe rule on double sale
under ArL. 1344, nCC.
%B:@2 8ules of preference ln double sale
1. Þersonal properLy - possessor ln good
falLh
2. 8eal properLy
a. 8eglsLranL ln good falLh
b. Þossessor ln good falLh
c. Þerson wlLh Lhe oldesL LlLle ln good
falLh (Att. 1544, Ncc)
lf agenL acLed ln good falLh, Lhe prlnclpal shall be
llable for damages Lo Lhe Lhlrd person whose
conLracL musL be re[ecLed. lf agenL ls ln bad falLh, he
alone shall be llable. (Att. 1917, Ncc)
!#-()C)$&1 "0$' -. "% "4&%$
62 789: 9>@ :8@ =>B8;M;:@K 9J:< BF 9? 9N@?:A
"2
1. Þersonal acLs
2. Crlmlnal or lllegal acLs
%B:@2 e.g.:
1. 8lghL Lo voLe
2. Maklng of a wlll
3. under oaLh sLaLemenLs
4. ALLendlng board meeLlngs of corporaLlons.
(ue leoo, p. J58, 2005 eJ)
62 09? 9 =@><B? 9J:;?N 9< 9? 9N@?: @<J9=@
J>;E;?9D D;9M;D;:P MP L;>:H@ BF :8@ JB?:>9J: BF
9N@?JPA
"2 no. 1he law on agency has no appllcaLlon ln
crlmlnal cases. When a person parLlclpaLes ln Lhe
commlsslon of a crlme, he cannoL escape
punlshmenL on Lhe ground LhaL he slmply acLed
as an agenL of anoLher parLy. (Ooq v. cA, C.k. No.
119858, Apt. 29, 200J)
`5 )##&+-0"C3& "4&%0,
62 78@? ;< 9N@?JP ;>>@LBJ9MD@A
"2
1. lf a bllaLeral conLracL depends upon lL
2. lf lL ls Lhe means of fulfllllng an
obllgaLlon already conLracLed
3. lf parLner ls appolnLed manager and hls
removal from Lhe managemenL ls
un[usLlflable. (Att 1927)
4. lf lL has been consLlLuLed ln Lhe
common lnLeresL of Lhe prlnclpal and
Lhe agenL (Att. 19J0)
3. SLlpulaLlon pour aLrul
62 (BO E9P :8@ 9N@?: O;:8K>9O F>BE :8@
9N@?JPA
"2 1he agenL may wlLhdraw from Lhe agency by
glvlng due noLlce Lo Lhe prlnclpal. lf Lhe laLLer
should suffer any damage by reason of Lhe
wlLhdrawal, Lhe agenL musL lndemnlfy hlm
Lherefor, unless Lhe agenL should base hls
wlLhdrawal upon Lhe lmposslblllLy of conLlnulng
Lhe performance of Lhe agency wlLhouL grave
deLrlmenL Lo hlmself. (1736a)
%-$&2 1he agenL, even lf he should wlLhdraw from
Lhe agency for a valld reason, musL conLlnue Lo acL
unLll Lhe prlnclpal has had reasonable opporLunlLy Lo
Lake Lhe necessary sLeps Lo meeL Lhe slLuaLlon.
`)5 /-1&' -. &`$)%4*)'(/&%$
62 789: ;< i=>@<HE=:;B? BF JB?:;?H9?J@ BF
9N@?JPjA
"2 lL means LhaL when once shown Lo have
exlsLed, an agency relaLlon wlll be presumed Lo
have conLlnued, ln Lhe absence of anyLhlng whlch
shows lLs LermlnaLlon.
+'$ ,-./&% %-$&' 0122
62 789: 9>@ :8@ @<<@?:;9D @D@E@?:< FB>
JB?:;?H9?J@ BF 9N@?JPA
S7u
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
"2 8oLh prlnclpal and agenL musL be:
1. ÞresenL
2. CapaclLaLed
J. SolvenL (ue leoo, commeots ooJ coses
oo lottoetsblp, Aqeocy, ooJ 1tost, p.
610, 2005 eJ)
62 09? :8@ 8@;>< JB?:;?H@ :8@ 9N@?JPA
"2
4#2 no.
kotlo. 1he agency calls for personal servlces
on Lhe parL of Lhe agenL slnce lL ls founded on
a flduclary relaLlonshlp, rlghLs and obllgaLlons
lnLransmlsslble.
`!%<2
1. Agency by operaLlon of law, or a
presumed or LaclL agency
2. Agency ls coupled wlLh an lnLeresL ln
Lhe sub[ecL maLLer of Lhe agency (e.q.
power of sale ln a morLgage)
62 789: 9>@ :8@ EBK@< BF @S:;?NH;<8;?N 9?
9N@?JPA
"2 &17"#1
1. &xplraLlon of Lhe perlod
2. 1eaLh, clvll lnLerdlcLlon, lnsanlLy or
lnsolvency of prlnclpal or of Lhe agenL
3. 7lLhdrawaD by Lhe agenL
4. "ccompllshmenL of Lhe ob[ecL or Lhe
purpose of Lhe agency
3. #evocaLlon
6. 1lssoluLlon of Lhe flrm or corporaLlon
whlch enLrusLed or accepLed Lhe
agency.
%B:@2 1he llsL ls oot excloslve, May also be
exLlngulshed by Lhe modes of exLlngulshmenL of
obllgaLlons ln general whenever Lhey are appllcable,
llke loss of tbe tbloq and oovotloo.
#&+-0"$)-%
62 )< 9 JB?:>9J: BF 9N@?JP >@LBJ9MD@A
"2
4#2 ?es. Agency ls tevocoble aL wlll by Lhe
prlnclpal.
`!%<2 lL cannoL be revoked lf:
1. a bllaLeral conLracL depends upon lL
2. lL ls Lhe means of fulfllllng an obllgaLlon
already conLracLed
3. a parLner ls appolnLed manager of a
parLnershlp and hls LermlnaLlon ls
un[usLlflable
4. lL ls creaLed noL only for Lhe lnLeresL of
Lhe prlnclpal buL also for Lhe lnLeresL of
Lhlrd persons
`!% :B :8@ `!%2 When Lhe agenL acLs Lo
defraud Lhe prlnclpal.
62 789: 9>@ :8@ R;?K< BF >@LBJ9:;B?A
": 8evocaLlon may elLher be express or lmplled.
(ue leoo, commeots ooJ coses oo lottoetsblp,
Aqeocy, ooJ 1tost, p. 625, 2005 eJ)
62 (BO ;< 9N@?JP ;E=D;@KDP >@LBR@KA
"2 Þrlnclpal:
1. appolnLs a new agenL for Lhe same
buslness or LransacLlon (Att. 192J,
Ncc),
2. dlrecLly manages Lhe buslness
enLrusLed Lo Lhe agenL (Att. 1924, Ncc),
or
3. afLer granLlng general power of
aLLorney, granLs a speclal one Lo
anoLher agenL whlch resulLs ln Lhe
revocaLlon of Lhe former as regards Lhe
speclal maLLer lnvolved ln Lhe laLLer.
(Att. 1926, Ncc)
62 (BO ;< 9N@?JP >@LBR@K O8@? :8@ 9N@?: 89<
M@@? 9==B;?:@K MP :OB B> EB>@ =>;?J;=9D<A
"2 Any one of Lhe prlnclpals ls granLed Lhe rlghL Lo
revoke Lhe power of aLLorney wlLhouL Lhe
consenL of Lhe oLhers.
62 )< ?B:;J@ BF >@LBJ9:;B? ?@J@<<9>PA
"2
1. As to tbe oqeot - Lxpress noLlce ls noL
necessary, sufflclenL noLlce lf Lhe parLy
Lo be noLlfled acLually knows, or has
reason Lo know, a facL lndlcaLlng LhaL
hls auLhorlLy has been
LermlnaLed/suspended, revocaLlon
wlLhouL noLlce Lo Lhe agenL wlll noL
render lnvalld an acL done ln pursuance
of Lhe auLhorlLy
2. As to J
tJ
petsoos - Lxpress noLlce ls
necessary
a. As to fotmet costomets - AcLual
noLlce musL be glven Lo Lhem
because Lhey always assume Lhe
conLlnuance of Lhe agency
relaLlonshlp
",&%34
b. As to otbet petsoos - noLlce by
publlcaLlon ls enough
%B:@2 1here ls lmplleJ tevocotloo of Lhe prevlous
agency wbeo Lhe prlnclpal appolnLs a new agenL for
Lhe same buslness or LransacLlon, provlded Lhere ls
lncompaLlblllLy. 8ot Lhe revocaLlon does noL become
effecLlve as beLween Lhe prlnclpal and Lhe agenL
unLll lL ls ln some way communlcaLed Lo Lhe laLLer.
62 789: ;< :8@ @FF@J: BF :8@ K;>@J: E9?9N@E@?:
MP :8@ =>;?J;=9DA
"2
4#2 1he agency ls revoked for Lhere would no
longer be any basls for Lhe represenLaLlon
prevlously conferred. 8ot Lhe prlnclpal musL
acL ln good falLh and noL merely Lo avold hls
obllgaLlon Lo Lhe agenL.
`!%2 1he only deslre of Lhe prlnclpal ls for
hlm and Lhe agenL Lo manage Lhe buslness
LogeLher.
62 #;J89>K <BDK 9 D9>N@ =9>J@D BF D9?K ;? 0@MH :B
3@B FB> !TYY E;DD;B? =9P9MD@ ;? 9??H9D
;?<:9DDE@?:< BL@> 9 =@>;BK BF :@? P@9><Q MH: :;:D@
O;DD >@E9;? O;:8 #;J89>K H?:;D :8@ =H>J89<@ =>;J@
;< FHDDP =9;K5 $B @?9MD@ 3@B :B =9P :8@ =>;J@Q
#;J89>K N9L@ 8;E 9 =BO@>BF9::B>?@P
9H:8B>;[;?N 8;E :B <HMK;L;K@ :8@ D9?KQ <@DD :8@
;?K;L;KH9D DB:<Q 9?K K@D;L@> :8@ =>BJ@@K< :B
#;J89>KQ :B M@ 9==D;@K :B :8@ =H>J89<@ =>;J@5 .;L@
P@9>< D9:@>Q #;J89>K >@LBR@K :8@ =BO@> BF
9::B>?@P 9?K :BBR BL@> :8@ <9D@ BF :8@
<HMK;L;<;B? DB:< 8;E<@DF5 )< :8@ >@LBJ9:;B? L9D;K
B> ?B:A 78PA
"2 1he revocaLlon ls noL valld. 1he power of
aLLorney glven Lo Lhe buyer ls lrrevocable because
lL ls coupled wlLh an lnLeresL - Lhe agency ls Lhe
means of fulfllllng Lhe obllgaLlon of Lhe buyer Lo
pay Lhe prlce of Lhe land (Att. 1927, Ncc). ln oLher
words, a bllaLeral conLracL (conLracL Lo buy and
sell Lhe land) ls dependenL on Lhe agency. eUYYT
C9> 6H@<:;B?f
62 &KH9>KB @S@JH:@K 9 '!" 9H:8B>;[;?N l@?9;K9
:B =9>:;J;=9:@ ;? :8@ =>@GH9D;F;J9:;B? 9?K
M;KK;?N BF 9 %)" =>BV@J: 9?K :B >@=>@<@?: 8;E ;?
9DD :>9?<9J:;B?< >@D9:@K :8@>@:B5 ): O9< N>9?:@K
:B :8@E5 l@?9;K9 D@9<@K /9?H@DW< 8@9LP
@GH;=E@?: :B M@ H<@K FB> :8@ %)" =>BV@J:5
/9?H@D ;?:@>=B<@K ?B BMV@J:;B? :B l@?9;K9W<
9J:H9:;B?<5 &KH9>KB D9:@> >@LBR@K :8@ '!"
9DD@N;?N :89: l@?9;K9 9J:@K M@PB?K 8@> 9H:8B>;:P
;? JB?:>9J:;?N O;:8 /9?H@D H?K@> :8@ '!"5
1@J;K@5
S71
"2 no. Lduardo and Zenalda enLered lnLo a
parLnershlp wlLh regard Lo Lhe nlA pro[ecL. Also,
Lduardo was presenL when Zenalda conLracLed
wlLh Manuel. under ArL. 1818, nCC, every parLner
ls an agenL of Lhe parLnershlp for Lhe purpose of
lLs buslness and each one may separaLely execuLe
all acLs of admlnlsLraLlon, unless, under ArL. 1801,
nCC, a speclflcaLlon of Lhelr respecLlve duLles has
been agreed upon, or else lL ls sLlpulaLed LhaL any
one of Lhem shall noL acL wlLhouL Lhe consenL of
all Lhe oLhers. (MeoJozo v. loole, C.k. No.
175885, leb. 1J, 2009)
1&"$(
62 789: ;< :8@ @FF@J: BF K@9:8 BF 9 =9>:P :B :8@
JB?:>9J: BF 9N@?JPA
"2
4#2 1he agency ls LermlnaLed by Lhe deaLh of
Lhe prlnclpal even lf Lhe agency ls for a
deflnlLe perlod.
`!%<2
1. lf lL has been consLlLuLed ln common
lnLeresL of Lhe prlnclpal and Lhe agenL
or ln Lhe lnLeresL of Lhe Lhlrd person
who accepLed Lhe sLlpulaLlon ln hls
favor, or
2. AnyLhlng done by Lhe agenL wlLhouL Lhe
knowledge of Lhe deaLh of Lhe prlnclpal
or on any oLher cause whlch
exLlngulshes Lhe agency ls valld and
shall be effecLlve on Lhlrd persons who
may have conLracLed wlLh hlm ln good
falLh.
62 )< :8@ <9D@ BF :8@ D9?K MP :8@ 9N@?: 9F:@> :8@
K@9:8 BF :8@ =>;?J;=9D L9D;KA
"2 ArLlcle 1931, nCC provldes LhaL an acL done by
Lhe agenL afLer Lhe deaLh of Lhe prlnclpal ls valld
and effecLlve lf Lhese Lwo requlslLes concur:
1. LhaL Lhe agenL acLed wlLhouL Lhe
knowledge of Lhe deaLh of Lhe prlnclpal,
and
2. LhaL Lhe Lhlrd person who conLracLed
wlLh Lhe agenL hlmself acLed ln good
falLh.
Cood falLh here means LhaL Lhe Lhlrd person was
noL aware of Lhe deaLh of Lhe prlnclpal aL Lhe
Llme LhaL he conLracLed wlLh sald agenL. (kollos v.
lellx Co cboo, C.k. No. l24JJ2, Ioo. J1, 1978)
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
+'$ ,-./&% %-$&' 0122
S72
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
0("%4& -. 0)#0*/'$"%0&' '*##-*%1)%4
$#"%'"0$)-%
62 789: ;< :8@ @FF@J: BF 9 J89?N@ BF J;>JHE<:9?J@
<H>>BH?K;?N :8@ :>9?<9J:;B?A
"2
4#2 1he ootbotlty of Lhe agenL ls tetmlooteJ.
`!%<2
1. lf Lhe orlglnal clrcumsLances are
resLored wlLhln a reasonable perlod of
Llme, Lhe agenL's auLhorlLy may be
revlved,
2. Where Lhe agenL has reasonable doubLs
as Lo wheLher Lhe prlnclpal would
deslre hlm Lo acL, hls auLhorlLy wlll noL
be LermlnaLed lf he acLs reasonably, or
J. Where Lhe prlnclpal and agenL are ln
close dally conLacL, Lhe agenL's
auLhorlLy Lo acL wlll noL LermlnaLe upon
a change of clrcumsLances lf Lhe agenL
knows Lhe prlnclpal ls aware of Lhe
change and does noL glve hlm new
lnsLrucLlons. (ue leoo, pp. 616617,
2005 eJ)
7)$(1#"7"3 C, $(& "4&%$
62 09? :8@ 9N@?: O;:8K>9O F>BE :8@ 9N@?JPA
"2 ?es. 1he agenL may renounce or wlLhdraw
from Lhe agency aL any Llme, wlLhouL Lhe consenL
of Lhe prlnclpal, even ln vlolaLlon of Lhe laLLer's
conLracLual rlghLs, sub[ecL Lo llablllLy for breach of
conLracL or for LorL.
62 789: 9>@ :8@ R;?K< BF O;:8K>9O9D MP :8@
9N@?:A
"2
3. wltboot jost coose - 1he law lmposes
upon Lhe agenL Lhe duLy Lo glve due
noLlce Lo Lhe prlnclpal and Lo lndemnlfy
Lhe prlnclpal should Lhe laLLer suffer
damage by reason of such wlLhdrawal.
4. wltb jost coose - 1he agenL cannoL be
held llable.
3-5!#-5)'&
0-/!#-/)'&
S7S
* % ) + & # ' ) $ , - . ' " % $ - $ - / " '
!"# $% & " ' ') *) + ) # , - ./ 0 / %
"0"1&/)0' 0(")#2 LLS1L8 !A? ALAn L. lLC8LS ll
+)0& 0(")#' .-# "0"1&/)0'2 kA8Ln !C? C. SA8uCC & !CPn PLn8? C. MLnuCZA
+)0& 0(")# .-# "1/)%)'$#"$)-% "%1 .)%"%0&: !LAnLLLL C. LLL
+)0& 0(")#' .-# 3",-*$ "%1 1&')4%2 LA8L LCulL M. MASACA?An & 1PLLnA C. MA81lnLZ
)5 1&.)%)$)-%
62 789: ;< 9 JBE=>BE;<@A
"2 A compromlse ls a conLracL whereby Lhe
parLles, by maklng reclprocal concesslons, avold
llLlgaLlon or puL an end Lo one already
commenced. (Att. 2028, Ncc)
62 789: 9>@ :8@ J89>9J:@>;<:;J< BF 9
JBE=>BE;<@A
"2
1. 0onsensual
2. #eclprocal
3. %omlnaLe
4. -nerous
3. "ccessory (ln Lhe sense LhaL a prlor
confllcL ls pre supposed)
6. Cnce accepLed, lL ls Clndlng on Lhe
parLles, provlded Lhere ls no vlLlaLed
consenL (Mccottby v. 8otbet 5teomsblp
lloes, 45 lbll. 488).
7. lL ls Lhe 'eLLlemenL of a coottovetsy
ptloclpolly, and ls buL merely
lncldenLally, Lhe seLLlemenL of a clalm.
(lblJ)
62 789: 9>@ :8@ R;?K< BF JBE=>BE;<@A
"2
1. !udlclal - Lo end a pendlng llLlgaLlon
2. LxLra[udlclal - Lo prevenL a llLlgaLlon
from arlslng
62 789: ;< :8@ M9<;J KH:P BF 9 JBH>: O8@?@L@> 9
<H;: ;< F;D@KA
"2 1he courL shall endeavor Lo persuade Lhe
llLlganLs ln a clvll case Lo agree upon some falr
compromlse. (Att. 2029, Ncc)
62 789: J;>JHE<:9?J@< E9P 9 =>BJ@@K;?N ;? 9
J;L;D 9J:;B? M@ <H<=@?K@KA
"2
1. lf wllllngness Lo dlscuss a posslble
compromlse ls expressed by one or
boLh parLles, or
2. lf lL appears LhaL one of Lhe parLles,
before Lhe commencemenL of Lhe
acLlon or proceedlng, offered Lo dlscuss
a posslble compromlse buL Lhe oLher
parLy refused Lhe offer.
62 ` ;< ;?K@M:@K :B , ;? :8@ 9EBH?: BF !XYQ YYY
O;:8 :8@ <:;=HD9:;B? :89: :8@ <9E@ <89DD @9>?
;?:@>@<: 9: kY^ =@> 211,7: 78@? ` F9;D@K :B
=9PQ , <H@K 8;E5 )? 9? @FFB>: :B <@::D@ :8@ J9<@Q `
BFF@>@K :B =9P :8@ =>;?J;=9D MH: M@NN@K FB> :8@
>@KHJ:;B? BF :8@ ;?:@>@<:5 , >@FH<@KQ 8@?J@Q :>;9D
O9< JB?KHJ:@K5 09? :8@ VHKN@ >@KHJ@ :8@ >9:@ BF
;?:@>@<:A
"2 ?es. 1he courLs may mlLlgaLe Lhe damage Lo be
pald by Lhe loslng parLy who has shown a slncere
deslre for a compromlse. (Att. 20J1, Ncc)
62 09? :8@>@ M@ 9 JBE=>BE;<@ B? :8@ J>;E;?9D
9<=@J: BF 9 J>;E@A
"2 none. 1here may be a compromlse upon Lhe
clvll llablllLy arlslng from an offense, buL such
compromlse shall noL exLlngulsh Lhe publlc acLlon
for Lhe lmposlLlon of Lhe legal penalLy. (Att. 20J4,
Ncc)
))5 +-)1 0-/!#-/)'&
62 78@? ;< 9 JBE=>BE;<@ LB;KA
"2
1. 0lvll sLaLus
2. +alldlLy of a marrleage or a legal
separaLlon
3. "ny ground for legal separaLlon
4. .uLure supporL
3. IurlsdlcLlon of courLs
6. .uLure leglLlme
)))5 &..&0$
62 789: ;< :8@ @FF@J: ;F :OB =9>:;@< @?:@> ;?:B 9
JBE=>BE;<@A
"2 lL has Lhe effecL of tes joJlcoto. A compromlse
has upon Lhe parLles Lhe effecL and auLhorlLy of
tes joJlcoto. (Att. 20J7, Ncc)
62 789: >@GH;>@E@?: ;< ?@J@<<9>P ;? B>K@> :89: 9
JBE=>BE;<@ M@ @S@JH:@KA
"2 ln order LhaL a compromlse may be execuLed,
Lhere musL be approval of Lhe courL. (Att 20J7,
Ncc)
62 " 9?K C @?:@>@K ;?:B 9 JBE=>BE;<@
9N>@@E@?:5 " O@@R :8@>@9F:@>Q C F;D@K 9? 9J:;B?
;? JBH>: <@@R;?N :B 9??HD :8@ JBE=>BE;<@
9N>@@E@?: JB?:@?K;?N :89: ;: ;< B?@<;K@K5 )< :8@
9J:;B? =>B=@>A
+'$ ,-./&% %-$&' 0122
S74
0)+)3 3"7 $&"/2
"1+)' A11?. LLML8 1. 8A8u?A, '*CI&0$ (&"12 ALl8LuC 8. ulMAlLLlx ll,
"''$5 '*CI&0$ (&"1'2 kA8Ln lLLlZ C. SuÞnAu, LAM8L81C L. SAn1CS lll, /&/C&#'2 ÞAuL LL8L81 L. AMCn, ALS1Cn AnA8nA, CZAn !.
luLLL8CS, CLClLlC M. !lMLnC, !8., lSMALL SA8AnCA?A, !8., 0-%$#)C*$-#'2 LClSL 8AL C. nAvAL, MCnlCA !uCCM
"2 no, because where Lhe compromlse ls
lnsLlLuLed and carrled Lhrough ln good falLh, Lhe
facL LhaL Lhere was a mlsLake as Lo Lhe law or as
Lo Lhe facLs, excepL ln cerLaln cases where Lhe
mlsLake was muLual and correcLlble as such ln
equlLy, cannoL afford a basls for seLLlng aslde a
compromlse. Compromlses are favored wlLhouL
regard Lo Lhe naLure of Lhe conLroverslal
compromlse, and Lhey cannoL be seL aslde
because Lhe evenL shows all Lhe galns have been
on one slde. (Asooq v. lotetmeJlote Appellote
coott, Moy 12, 1989)
62 ` 9?K , @?:@>@K ;?:B 9 JBE=>BE;<@
9N>@@E@?: O8@>@MP ` >@<=@J:@K :8@ BO?@><8;=
BF , BL@> 9 =9>: BF 9 J>@@R e?BO 9 F;<8=B?Kf5 )<
:8@ 9N>@@E@?: L9D;KA
"2 no, because LhaL ls conLrary Lo publlc pollcy
and Lhe law. 1he creek ls a properLy belonglng Lo
Lhe SLaLe, hence, lL ls parL of publlc domaln whlch
ls noL suscepLlble Lo prlvaLe approprlaLlon and
acqulslLlon. (Mooeclooq v lotetmeJlote Appellote
coott, 161 5ckA 469)
62 ` 9?K , @?:@>@K ;?:B 9 JBE=>BE;<@
9N>@@E@?:Q :@>E;?9:;?N 9 <H;: M@:O@@? :8@E5 `
F9;D@K :B JBE=DP O;:8 :8@ :@>E< 9?K JB?K;:;B?<
BF :8@ <9E@5 789: 9>@ :8@ >@E@K;@< BF :8@
9NN>;@L@K =9>:PA
"2 lf one of Lhe parLles falls or refuses Lo ablde by
Lhe compromlse, Lhe oLher parLy may elLher
enforce Lhe compromlse, or regard lL as resclnded
and lnslsL upon hls orlglnal demand. (Att 2041,
Ncc).
62 789: ;< :8@ @FF@J: BF 9 JB?:>9J: B> 9
JBE=>BE;<@ @L@? ;F ;: ;< K;<9KL9?:9N@BH< :B B?@
BF :8@ =9>:;@<A
"2 lL ls sLlll a valld one. lL ls a long esLabllshed
docLrlne LhaL Lhe law does noL relleve a parLy
from Lhe effecLs of an unwlse, foollsh, or
dlsasLrous conLracL, enLered lnLo wlLh all Lhe
requlred formallLles and wlLh full awareness of
whaL he ls dolng. CourLs have no power Lo relleve
parLles from obllgaLlons volunLarlly assumed,
slmply because Lhelr conLracLs Lurned ouL Lo be
dlsasLrous deals or unwlse lnvesLmenLs. (1ooJo v.
AlJoyo, 89 lbll. 497, vlllocotte v. Motlooo, 89
lbll. J41)
lL ls a Lrulsm LhaL ºa compromlse agreemenL
enLered lnLo by parLyllLlganLs, when noL conLrary
Lo law, publlc order, publlc pollcy, morals, or good
cusLoms ls a valld conLracL whlch ls Lhe law
beLween Lhe parLles Lhemselves. lL follows,
Lherefore, LhaL a compromlse agreemenL, noL
LalnLed wlLh lnflrmlLy, lrregularlLy, fraud or
lllegallLy ls Lhe beLween Lhe parLles who are duLy
bound Lo ablde by lL and observe sLrlcLly lLs Lerms
and condlLlons". (ísqoetto v. cA, Ck 119J10,
lebtooty J, 1997)
