TECK SEING AND CO., LTD., petitioner-appellee.

SANTIAGO JO CHUNG, ET AL., partners,

vs.
PACIFIC COMMERCIAL COMPANY, ET AL., creditors-appellants

FACTS:

In an insolvency proceedings of "Sociedad Mercantil, Teck Seing & Co.,

Ltd.," the creditors, Pacific Commercial Company, Piñol & Company, Riu
Hermanos, and W. H. Anderson & Company, filed a motion with the Court to
declare the individual partners as parties to this proceeding, to require each of
said partners to file an inventory of his property in the manner required by
section 51 of Act No. 1956, and that each of said partners be adjudicated
insolvent debtors in this proceeding. The trial judge first granted the motion,
but, subsequently, on opposition being renewed, denied it. It is from this last
order that an appeal was taken in accordance with section 82 of the Insolvency
Law.

ISSUE:

Whether Teck Seing & Co., Ltd. is a partnership

RULING:

The mercantile establishment which operated under the name of Teck

Seing & Co., Ltd. And which was constituted by the document set forth in the
decision is a general partnership.

The document providing for the partnership contract purported to

form "una sociedad mercantil limitada," and counsel for the petitioner's first
contention was that Teck Seing & Co., Ltd., was not "una sociedad regular
colectiva, ni siquiera comanditaria, sino una sociedad mercantil limitada." Let
us see if the partnership contract created a "sociedad en comandita," or, as it
is known in English, and will hereafter be spoken of, "a limited partnership."

To establish a limited partnership there must be, at least, one general

partner and the name of the least one of the general partners must appear in
the firm name. (Code of Commerce, arts. 122 [2], 146, 148.) But neither of
these requirements have been fulfilled. The general rule is, that those who
seek to avail themselves of the protection of laws permitting the creation of
limited partnerships must show a substantially full compliance with such laws.
A limited partnership that has not complied with the law of its creation is not
considered a limited partnership at all, but a general partnership in which all
the members are liable. (Mechem, Elements of Partnership, p. 412; Gilmore,
Partnership, pp. 499, 595; 20 R C. L. 1064.)

The contention of the creditors and appellants is that the partnership

contract established a general partnership.

Turning to the document before us, it will be noted that all of the
requirements of the Code have been met, with the sole exception of that
relating to the composition of the firm name.
URBANO LOTA (Substituted by SOLOMON LOTA in his capacity as
Administrator of the Estate of URBANO LOTA), plaintiff-appellant,
vs.
BENIGNO TOLENTINO, defendant-appellee.

FACTS:

The plaintiff filed an action against defendant to order the latter (a) to
render an accounting of his management of their partnership, and (b) to deliver
to plaintiff whatever share he may have in the assets of the partnership after
the liquidation has been has been approved by the Court.

The partnership was entered into by and between plaintiff and defendant in
the year 1918, whereby they agreed to engage in general business in Alabat,
Batangas, both to divide the profits and losses share alike, and defendant to
be manager of the partnership. Plaintiff alleges that from 1918 until 1928
defendant had rendered an annual accounting, but has refused to do so from
1929 to 1937, hence, plaintiff's complaint.

Defendant filed an answer, alleging that defendant was the industrial

partner in said partnership; that he rendered a yearly accounting and
liquidation thereof from 1918 to 1932, and that in the latter year, 1932, the
partnership was dissolved and defendant delivered all its properties and
assets to the plaintiff. The defendant prays for the dismissal of plaintiff's
complaint.

The plaintiff died in 1938, and on September 28, 1939, he was substituted
by the administrator of his estate, Solomon Lota.

The Court ordered the dismissal of the case for lack of prosecution. This
order was reconsidered and set aside upon a showing by plaintiff that he had
filed a petition for the issuance of letters of administration to deceased
defendant's surviving spouse, Marta Sadiasa, for the purpose of substituting
her for the deceased defendant.

It will thus be seen that from defendant's death to the present, or almost
ten years, no administrator or legal representative had been actually
substituted to take the place of said defendant. It was only on April 6, 1949,
that plaintiff made another try to substitute said deceased by filing his motion,
referred to in the first paragraph of this resolution, praying that defendant's
heirs be substituted for him as parties defendant.
ISSUE:

Whether after the death of the defendant, plaintiff's action for accounting
and liquidation of the partnership may be continued against the heirs of
Benigno Tolentino

RULING:

Plaintiff's action for accounting and liquidation of the partnership formed

between plaintiff and the deceased defendant who was the industrial and
managing partner can not be continued against the heirs of the deceased
defendant. It is well settled that when a member of a mercantile partnership
dies, the duty of liquidating its affairs devolves upon the surviving member, or
members, of the firm, not upon the legal representatives of the deceased
partner.

The proceedings in this cause, considered in the character of an action for

an accounting, were futile; and the court, abandoning entirely the effort to
obtain an accounting, gave judgment against the administrator upon the
supposed liability of his intestate to respond for the plaintiffs proportionate
share of the capital and assets. But of course the action was not maintenable
in this aspect after the death of the defendant; and the motion to discontinue
the action against the administrator should have been granted.

The theory of the appellant is that the heirs may properly be substituted for
the deceased Benigno Tolentino, because they are in possession of property
allegedly belonging to the partnership in question, and the appellant seeks the
recovery thereof. Apart from the fact that said allegation seems to refer to
cause of action foreign to the claim for accounting and liquidation against
Tolentino, and should have been made in proper pleading to duly admitted by
the lower court, the filing of appellant's motion for substitution more than twelve
years after the institution of the complaint came too late and already called for
the prosecution. It is immaterial that, before the appealed resolution was
issued by the lower court, the appellant attempted to have the deceased
defendant had not yet been properly substituted.