PROBLEMS PARTNERSHIP

Dielle, Karlo and Una are general partners in a merchandising firm.

Having contributed equal amounts to the capital, they also agree on
equal distribution of whatever net profit is realized per fiscal period.
After two years of operation, however, Una conveys her whole
interest in the partnership to Justine, without the knowledge and
consent of Dielle and Karlo.

1. Is the partnership dissolved? 12%]

SUGGESTED ANSWER:
• 1 No, a conveyance by a partner of his whole interest in a
partnership does not of itself dissolve the partnership in the absence
of an agreement. (Art.1813. Civil Code)
2. What are the rights of Justine, if any, should she desire to participate in
the management of the partnership and in the distribution of a net profit
ofP360.000.00 which was realized after her purchase of Una's interest?

SUGGESTED ANSWER:
2. Justine cannot interfere or participate in the management or
administration of the partnership business or affairs. She may, however,
receive the net profits to which Una would have otherwise been entitled. In
this case, P120.000 (Art. 1813, Civil Code)
Interpreting Art. 1830 (1) (c) to mean that if one of the partners had
assigned his interest on the partnership to another the remaining partners
may not dissolve the A should be hired as Secretary. The decision for the
hiring partnership, the dissolution by Patricia and Priscilla without the
consent of Pauline or Philip is not valid.
Pauline, Patricia and Priscilla formed a business partnership for the
purpose of engaging in neon advertising for a term of five (5) years. Pauline
subsequently assigned to Philip her interest in the partnership. When
Patricia and Priscilla learned of the assignment, they decided to dissolve
the partnership before the expiration of its term as they had an unproductive
business relationship with Philip in the past. On the other hand, unaware of
the move of Patricia and Priscilla but sensing their negative reaction to his
acquisition of Pauline's interest, Philip simultaneously petitioned for the
dissolution of the partnership.
1. Is the dissolution done by Patricia and Priscilla without the consent of
Pauline or Philip valid? Explain
Answer : Under Art. 1830 (1) (c) of the NCC, the dissolution by Patricia and
Priscilla is valid and did not violate the contract of partnership even though
Pauline and Philip did not consent thereto. The consent of Pauline is not
necessary because she had already assigned her interest to Philip. The
consent of Philip is not also necessary because the assignment to him of
Pauline's interest did not make him a partner, under Art, 1813 of the NCC
2. Does Philip have any right to petition for the dissolution of the
partnership before the expiration of its specified term? Explain.
SUGGESTED ANSWER:
2. No, Philip has no right to petition for dissolution because he does
not have the standing of a partner (Art. 1813 NCC)
On June 30, 1992, after Joe and Rudy formed a partnership to
operate a car repair shop in Quezon City. Joe provided the capital
while Rudy contributed his labor and industry. On one side of their
shop, Joe opened and operated a coffee shop, while on the other
side, Rudy put up a car accessories store. May they engage in such
separate businesses? Why?
SUGGESTED ANSWER:
• Joe, the capitalist partner, may engage in the restaurant business
because it is not the same kind of business the partnership is
engaged in. On the other hand, Rudy may not engage in any other
business unless their partnership expressly permits him to do so
because as an industrial partner he has to devote his full time to the
business of the partnership [Art. 1789, CC).
Composition of Partnerships; Spouses; Corporations (1994)
1) Can a husband and wife form a limited partnership to engage in
real estate business, with the wife being a limited partner?
SUGGESTED ANSWER:
• Yes. While spouses cannot enter into a universal partnership, they
can enter into a limited partnership or be members thereof (CIR u.
Suter, etal. 27 SCRA152).
Can two corporations organize a general partnership under the Civil Code
of the Philippines?
SUGGESTED ANSWER:
As a general rule, a corporation may not form a general partnership with
another corporation or an individual because a corporation may not be
bound by persons who are neither directors nor officers of the corporation.
However, a corporation may form a general partnership with another
corporation or an individual provided the following conditions are met:
a) The Articles of Incorporation of the corporation expressly allows the
corporation to enter into partnerships;
b) The Articles of Partnership must provide that all partners will manage
the partnership, and they shall be jointly and severally liable; and
c) In case of a foreign corporation, it must be licensed to do business in
the Philippines
Can a corporation and an individual form a general partnership?
No. A corporation may not be a general partner because the principle
of mutual agency in general partnership will violate the corporation law
principle that only the board of directors may bind the corporation.
Joseph and Edward entered into a universal partnership of all present
property. At the time of their agreement, Joseph had a four door apartment
which he inherited from his father 3 years earlier. Edward, on the other
hand, had a fishpond which he acquired by dacion en pago from Robert.
During the first year of the partnership, rentals collected on the four-door
apartment amounted to P480,000.00; while fish harvested from the
fishpond were sold for P300,000.00. During the same period, Edward
received by way of donation a two door apartment from his uncle. This' two
door apartment was rented to Ejercito and generate a rental income of
P10,000. The partners had no stipulation that property subsequently
acquire shall belong to the partnership. Which of the following does not
belong to the common fund of the partnership?
a. The four door apartment, two door apartment.
b. Four door apartment, two door apartment and rental income of
P10,000.00
c. Two door apartment and rental income of P10,000.00
d. Two door apartment
24. What is the order of payment of liabilities of a dissolved limited
partnership using the code number representing each liability?
i. Those owing to general partners other than for capital or for profits.
ii. Those owing to creditors including limited partners, except those to
limited partners on account of their contributions and general partners.
iii. Those owing to limited partners by way of their share in the profits
and other compensation by way of income,
iv. Those owing to limited partners in respect to the capital of their
contributions.
v. Those owing to general partners in respect of capita.
vi. Those owing to general partners in respect of profits.
a. I, II, III, IV, V, VI. c. II, I, III, IV, V, VI.
b. II, III, IV, I, VI, V. d. II, I, III, IV, VI, V.
A, B, C and D are partners. Their contributions are as follows: A,
P50,000; B, P30,000; C, P20,000; D, services. The partnership
incurred obligations to third persons which the firm was unable to pay.
After exhausting the assets of the partnership, there still is unpaid
balance of P10,000. How much can the creditor of Php 10,000 can
collect from each partner?
a. A, P5,000;B,P3,000;C,P2,000;D, nothing
b. A, P2,500; B, P2,500; C, P2,500; D, P2,500
c. A, P4,000; B, P3,000; C, P2,000; D, P1,000
d. A, P4,000; B, P4,000; C, P2,000; D, nothing
A, B and C are partners in X Company with B as managing partner. D
owes the partnership P4,500. D, also owes A Php 10,000 with interest.
D paid A ahead of the partnership and A issued a receipt in his name.
a. Partner A can be required to deliver the entire P10,000 with the
partnership
b. A cannot be required to share the P10,000 to the partnership as
he has no obligation to do so.
c. A should proportionately apply payment to the partnership and
to his claim.
d. A keep the money unless protest is filed by his co-partners due
to insolvency of the debtor.
Allan, Beth and Chris are partners with capital contribution of P
15,000, P 10,000 and P 5,000. respectively. Supposed on dissolution,
the assets of their partnership amount to only P 46,000 and it owed
Della the amount of P 50,000. Chris owes Polly on his personal
account P 6,000. The partners have no separate property except
Chris whose separate property amounts to P 7,000, Which is correct?
a. Della and Polly shall divide Chris separate property.
b. Della and Polly shall divide Chris property pro-rata.
c. Della shall be preferred as regards to Chris separate property.
d. Polly shall be preferred as regards to Chris separate property.
X,Y and Z, capital partners, each contributed P 10,000 and A, the
industrial partner contributed his industry. The net contractual liability
of the partnership amounted to P 90,000. The remaining assets of the
partnership amounted only to P 30,000. Supposed B got the P 30,000,
how can he recover the deficiency of his credit?
a. B can recover P 15,000 from each X, Y, Z and A.
b. B can recover P 60,000 from either X,Y and Z.
c. B can recover P 15,000 each from X, Y and Z but A is exempt
because he is an industrial partner.
d. B can recover P 20,000 each from X, Y and Z only.
A, B and C are partners. A is personally indebted to Y for P 20,000, for
which Y has obtained
a final judgment. Y asked the court to issue a writ of execution
charging A’s interest in the
partnership (his share of the profits). Which of the following is correct?
a. The charged interest of A may be redeemed by one or more partners
with their separate property;
b. The charged interest may be redeemed by the partnership funds and
with the consent of all the partners;
c. Y will receive and continue to receive from the receiver appointed by
the Court all A’s share in the profits until the P 20,000 is fully paid.
d. All of the above
A, B and C are partners. Their contributions are as follows: A,
P60,000; B, P40,000 and C, services. The partners agreed to divide
profits and losses in the following proportions.: A, 35%; B, 25% and C,
40%. If there is a loss of P10,000, how should the said loss of
P10,000 be shared by the partners?
a. A, P6,000; B, P4,000; C, nothing
b. A,P3,000; B, P2,000; C, P5,000
c. A, P3,500; B, P3,500; C, P3,000
d. A, P3,500; B, P 2,500; C, P4,000
X and Y established a partnership by contributing each at P 50,000.
Z, a third party allowed his name to be included in the firm name of the
partnership. The partnership was insolvent and after exhausting all
remaining asset, there was left a liability to third persons the amount
of P 30,000. The creditors can compel:
a. Z to pay the P 30,000 remaining liability
b. X, Y and Z to pay P 10,000 each
c. X or Y to pay the P 30,000 remaining liability
d. X and Y to pay P 15,000 each
A, B and C are partners in X company. D owes the partnership
P4,500. A, a partner, received from D a share of P1,500 ahead of
partners B and C, by giving D a receipt for his share only. When B
and C were collecting from D, the latter was already insolvent.
a. Partner A can be required to share the P1,500 with B and C.
b. A cannot be required to share the P1,500 with B and C.
c. B and C should automatically exhaust first all remedies to collect
from D.
d. B and C can automatically deduct from the capital contribution of
A in the partnership, their respective share in the P1,500.
W, X and Z formed a partnership. W, X and Y are general partners
and contributed P 50,000 each while Z and industrial partner
contributed his services only. All the partners signed an agreement
stipulating that the liability of W is limited to his contribution. After all
the assets of the partnership were exhausted there remains an unpaid
liability of P 40,000. The creditors of the partnership can compel
a. X and Y to pay the P 40,000.
b. X,Y and Z to pay the 40,000
c. W,X, Y and Z to pay 10,000 each and W and Z can demand
reimbursement from X and Y
d. X and Y to pay P 40,000