Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
PARTNERSHIP
Partnership
> a contract whereby two or more persons bind themselves to contribute money, property, or
industry to a common fund, with the intention of dividing the profits among themselves
Characteristics of Partnership
1. Consensual
2. Nominate
3. Bilateral
4. Onerous
5. Commutative
6. Principal
7. Preparatory
* A partnership duly formed under the law is a juridical person to which the law grants a
juridical personality separate and distinct from that of each of the partners. (Art. 1768)
* To organize a corporation or a partnership, is not a matter of absolute right but a privilege
which may be enjoyed only under such terms as the State may deem necessary to impose.
Page 1 of 6
Group 1
Partnership Co-ownership
Creation
created by contract only (express or implied) created by contract, law and other things
Juridical
has legal or juridical personality has no juridical personality
Purpose
for profit collective enjoyment; not necessarily for profit)
Transfer of Interest
cannot substitute another as partner in his place, can dispose of his share without the consent of the
without unanimous consent others
Length of Existence if Created by Contract
must not be for more than 10 years (although
no term limit is set by the law
agreement after Termination
Profits
may be stipulated upon profits must always depend on proportionate
shares; any stipulation to the contrary is VOID
Dissolution
not dissolved by the death or incapacity of co-
dissolved by death or incapacity of a partner
owner
Form
may be made in any form except when real
no public instrument needed even if real property is
property is contributed; here, a public instrument is
the object of the co-ownership
required.
GR: Sharing of NET profits is prima facie evidence that one is a partner.
XPNS: Art. 1764 Par. (4)
a. As a debt by installments or otherwise
b. As wages of an employee or rent to a landlord
c. As an annuity to a widow or representative of a deceased partner
d. As interest on a loan, though the amount of payment vary with the profits of the business
e. As the consideration for the sale of a goodwill of a business or other property by
installments or otherwise
Page 2 of 6
Group 1
Classifications of Partnership
As to the extent of its subject matter:
o Universal partnership (Art. 1777)
> one which refers to all the present property or to all profits
> has two kinds:
Universal partnership of all present property (Art. 1778)
comprises the following:
1. property which belonged to each of the partners at the time of the
constitution of the partnership
2. profits which they may acquire from all property contributed
Universal partnership of profits (Art. 1780)
comprises all that the partners may acquire by their industry or work during
the existence of the partnership
* Profits acquired by the partners through chance are NOT included.
o Particular partnership (Art. 1783)
> one which has for its object, determinate things, their use and fruits, or a specific
undertaking or the exercise of a profession or a vocation
Page 3 of 6
Group 1
GENERAL LIMITED
Extent of Liability
Personally liable for partnership obligations Liability extends only to his capital contributions
Right in Management
When manner of management is not agreed upon,
all general partners have an equal right in the No participation in management
management of the business
Contribution
Contribute cash, property or industry Contribute cash or property only, not industry
Effect of Death, Insolvency, Retirement, Insanity
Retirement, death, insolvency, insanity of general Does not have same effect; rights are transferred
partner dissolves partnership to legal representative
Creation
Created by the members after substantial
As a rule, it maybe constituted in any form, by
compliance in good faith of the requirements set
contract or conduct of the partnership
forth by law
Composition / Membership
Composed of one or more general partners and
Composed only of general partners
one or more limited partners
As to its duration
o Partnership at will
> for a particular undertaking or venture which may be terminated anytime by mutual
agreement
o Partnership with a fixed term
> term for which the partnership is to exist is fixed or agreed upon or one formed for a
particular undertaking
As to representation to others
o Ordinary or real partnership
> actually exists among the partners and also as to third persons
Page 4 of 6
Group 1
As to publicity
o Secret partnership
> the existence of certain persons as partners is not made known to the public by any
of the partners
o Open or notorious partnership
> existence is made known to the public by the members of the firm
As to purpose
o Commercial or trading partnership
> formed for the transaction of business
o Professional or non-trading partnership
> formed for the exercise of a profession
Classifications of Partners
Other Classifications
o Ostensible
> takes active part and known to the public as partner in the business
o Secret
> takes active part in the business but is not known to be a partner by outside parties
Page 5 of 6
Group 1
o Silent
> does not take any active part in the business although he may be known to be a
partner
o Dormant
> does not take active part in the business and is not known or held out as a partner
o Original partner
> one who is a member of the partnership from the time of its organization
o Incoming partner
> a person lately, or about to be, taken into an existing partnership as a member
o Retiring partner
> one withdrawn from the partnership
Page 6 of 6