immovable property of the partnership even if such
C. PROPERTY RIGHTS OF A
PARTNER
1. To possess specific partnership property and to
participate in management (Art. 1810, 1811)
Article 1810. The property rights of a partner are:
(1) His rights in specific partnership property;
(2) His interest in the partnership; and
(3) His right to participate in the management
INCIDENTS OF CO-OWNERSHIP
1. Equal rights to Possess
Article 1811. A partner is co-owner with his partners of specific
partnership property. The incidents of this co-ownership are such that:
(1) A partner, subject to the provisions of this Title and to any agreement
between the partners, has an equal right with his partners to possess
specific partnership property for partnership purposes; but he has no right
to possess such property for any other purpose without the consent of his
partners;
A partner has an equal right with his partners to possess
partnership property for partnership purposes
Includes use and control even without the consent of the other
partners. This includes sale and disposition (e.g. applying
partnership property to partnership debts)
Limitations:
(1) Not Exclusive One partner is not entitled to the exclusive
possession or control of the firm assets; the excluded partner or
partners may ask for a formal account from the excluding partner
and/or to petition for a decree of dissolution
(2) For partnership purposes only partner has no right to possess
property for any other purpose without the consent of his partners.
If he does, he is accountable for the value of such and the profits
he may have derived therefrom.
(3) Subject to agreement and provisions of Code
By agreement, exclusive possession and control of
partnership property may be vested in one partner
By express provision of the Code:
a. None of the partners may, without the consent of
the others, make any important alteration in the
b.
alteration may be useful to the partnership
The partner who has been appointed manager in
the article s of partnership may execute all acts of
administration despite opposition of his partners,
unless he should act in bad faith
c. If any of the partners should oppose the acts of the
other partners, the decision of the majority shall
prevail, or in case of a tie, the decision of those
owning the controlling interests
d. Certain acts enumerated in Art. 1818 (e.g.
assignment of partnership property in trust,
disposal of the good-will of the business, etc.) must
be authorized by all the partners.
2. Nonassignability
Article 1811. A partner is co-owner with his partners of specific
partnership property. The incidents of this co-ownership are such that:
(2) A partner's right in specific partnership property is not assignable
except in connection with the assignment of rights of all the partners in
the same property;
A partner's right in specific partnership property is not assignable
except in connection with the assignment of rights of all the
partners in the same property
This rule obtains even if the assignment is made after dissolution
of the partnership but before its termination by the completion of
the winding up of its business.
Effect of separate assignment
Any separate assignment of such right, or any attempt at such
assignment is null and void except when real property is involved
and the provisions of Art. 1819 of the Code relative to the interest
of an innocent purchaser apply
But such assignment, may in a proper case be regarded and held
as a valid assignment of his interest in the partnership
Reasons for nonassignability
1. Partnership is a voluntary relation and the other partners cannot
have a new partner thrust upon them without their consent.
Assignee would pro tanto become a partner since he would have
the right to possess the property for partnership purposes
irrespective of the desires of the other partners.
2. Impossibility to measure or value a partners beneficial interest in a
particular partnership asset
Prohibition is limited to:
1. Assignment by one partner to a third party or stranger unless it is
joined in by all the other partners, or
 2. Assignment to a partner not executed by all the other partners (4) A partner's right in specific partnership property is not subject to legal
support under article 291.

Prohibition does not apply to: Based on the basic policy of the law to keep intact partnership
1. Assignment by a partner to his sole remaining partner property for creditors and for partnership purposes
2. Assignment to two or more remaining partners, with the consent of
all

Reasons for inapplicability of prohibition on above two:

1. No outsider could interfere with the conduct, possession or PARTICIPATION IN MANAGEMENT
management of the partnership or partnership property General Rule: All partners have equal rights in the management and
2. No new partner is admitted to the partnership conduct of partnership business.
3. No other partner or no partnership creditor is deprived of his right Whatever any one of them may do alone shall bind the partnership
to have the partnership assets applied to the payment of Limitations
partnership debts o Power only embraces acts of administration and acts for
4. No other partner nor partnership creditor are prejudiced and apparently carrying on, in the usual way, the partnership
neither are subordinated to the claims of creditors of individual business
partners o Power does not cover acts of disposition nor acts not
apparently for carrying on the partnership business in the
3. Not subject to Attachment or Execution usual way nor power to modify articles of partnership
Article 1811. A partner is co-owner with his partners of specific o Decision of the majority, or in case of tie, that of the
partnership property. The incidents of this co-ownership are such that: owners of the controlling interest prevail should any
partner oppose an act
(3) A partner's right in specific partnership property is not subject to o No important alteration in any immovable property may be
attachment or execution, except on a claim against the partnership. made without the consent of the other partners even if
When partnership property is attached for a partnership debt the useful. But partner concerned may seek intervention of the
partners, or any of them, or the representatives of a deceased partner, court if the other partners refusal to give their consent is
cannot claim any right under the homestead or exemption laws; manifestly prejudicial to the interest of the partnership.
Consent may also be presumed if they didnt oppose
A partners right in specific partnership property is not subject to alteration despite knowledge.
attachment, except on a claim against the partnership.
Exception: Partners agree that management be vested in one or more of
the partners
Rationale
Logical consequence of the prohibition against separate
Extent of Authority
assignment by a partner of his right in such property. A managing partner may execute all acts of administration.
Powers are not specified May exercise all acts that may be
Remedy of partners separate creditors
necessary to attain the object of the
Although a partners separate creditors are prevented from partnership
reaching the specific property of the partnership or his rights Powers are specified Must act within the scope of his
therein, they may proceed against the partners interest in the authority; should not act in bad faith
partnership in accordance by obtaining from the court a charging
Sole manager May exercise all acts even against
order or lien, have the court appoint a receiver and order, where
the opposition of his partners,
necessary, the sale of the debtor partners interest in the
unless he does so in bad faith
partnership.
Solidary Management (multiple May execute all acts of
managers with no specification of administration, but if any of them
4. Not subject to Support
respective duties nor necessity of opposes, the majoritys decision
Article 1811. A partner is co-owner with his partners of specific
consent of all to act) shall prevail
partnership property. The incidents of this co-ownership are such that:
Joint Management (multiple Concurrence of all shall be
managers with stipulation that necessary for the validity of the
they cannot act without the acts.
 consent of others) account agreed to by all the partners.
Absence or disability of any one of
them cannot be alleged, unless
there is imminent danger of grave
or irreparable injury to the
INTEREST IN PARTNERSHIP
partnership.
(Note: this restriction is addressed Partners interest in the partnership his share of the profits and
to partner acting in the transaction surplus
not the third person who is under no PROFIT SURPLUS
obligation to ascertain whether Gain realized from the business or Excess of assets over liabilities
partner obtained consent of investment over and above
copartners) (Note: restriction expenditures or the excess of the
applies only to execution of formal value of returns over the value of
written contracts and not routine advances
matters) May be determined and distributed Usually determined and distributed
from time to time before the only after dissolution, winding up
Revocation of authority dissolution of the partnership and and liquidation
Power of managing partner is irrevocable without just or lawful winding up and liquidation of its
affairs
cause
The Code does not specify what would be considered as just or
Nature of a partners interest in the partnership:
lawful cause. However, it has been opined, that all grounds for the
BEFORE DISSOLUTION UPON DISSOLUTION
revocation of agency may be considered as such.
Interest is in the partnership as a Interest is in the property remaining
If power was granted by articles of partnership - revocation needs
business or a going concern. after all the debts and liabilities to
vote of the partners representing controlling interest
outside creditors have been
If power was granted by subsequent agreement - may be revoked satisfied.
at any time
INTEREST IN PARTNERSHIP RIGHT IN SPECIFIC PROPERTY
Personal property (intangible in
2. To share in the profits and surplus and to nature) and present interest
convey partnership interest (Art. 1812, 1813) Assignable irrespective of the Nonassignable
consent of the other partners
May be reached by the partners Not subject to attachment or
Article 1812. A partner's interest in the partnership is his share of the profits and separate creditors by means of a execution
surplus. charging order and other remedies
specified in Art. 1814
Partner can, with respect to it, When partnership property is
Article 1813. A conveyance by a partner of his whole interest in the partnership claim rights under the exemption attached for a partnership debt the
does not of itself dissolve the partnership, or, as against the other partners in the laws partners cannot claim any right
absence of agreement, entitle the assignee, during the continuance of the under the homestead or exemption
partnership, to interfere in the management or administration of the partnership laws;
business or affairs, or to require any information or account of partnership
transactions, or to inspect the partnership books; but it merely entitles the ASSIGNMENT OF INTEREST
assignee to receive in accordance with his contract the profits to which the General Rule: A partner may assign his interest in the partnership to his
assigning partner would otherwise be entitled. However, in case of fraud in the copartners or any of them, or to a third person.
management of the partnership, the assignee may avail himself of the usual
remedies.
Exception: Partners may agree that one of them cannot sell or assign his
interest without the consent of the others, or agree to prohibit assignment
In case of a dissolution of the partnership, the assignee is entitled to receive his altogether.
assignor's interest and may require an account from the date only of the last
Rights of assignee
 The transfer by a partner of his partnership interest to a third
person does not make the assignee of such interest a partner in
the firm.
He may not interfere in the management or administration of the
partnership business or affairs, or to require any information or
account of partnership transactions, or to inspect partnership
books.
It merely entitles him to receive the profits to which his assignor
would otherwise be entitled.
To become a partner, (1) the assignee must have such intention
and that (2) nonassigning partners agree to his joining them in
business
Rights of assignor
An assignment of partnership interest does not necessarily divest
the assigning partner of his status as partner. It all depends on the
terms of the assignment and the intent of the parties
But if assignor does not lose his rights, he also is not relieved of his
obligations.
Note: Assignment is not of itself a cause of dissolution (look at nature of
the assignment and intent or agreement of the parties)
CHARGING ORDER
Article 1814. Without prejudice to the preferred rights of partnership creditors under article
1827, on due application to a competent court by any judgment creditor of a partner, the court
which entered the judgment, or any other court, may charge the interest of the debtor partner
with payment of the unsatisfied amount of such judgment debt with interest thereon; and may
then or later appoint a receiver of his share of the profits, and of any other money due or to fall
due to him in respect of the partnership, and make all other orders, directions, accounts and
inquiries which the debtor partner might have made, or which the circumstances of the case
may require.
The interest charged may be redeemed at any time before foreclosure, or in case of a sale
being directed by the court, may be purchased without thereby causing a dissolution:
(1) With separate property, by any one or more of the partners; or
(2) With partnership property, by any one or more of the partners with the consent of all
the partners whose interests are not so charged or sold.
Nothing in this Title shall be held to deprive a partner of his right, if any, under the exemption
laws, as regards his interest in the partnership.
This article was taken from the U.S. Uniform Partnership Act which
was patterned after the English Partnership Act of 1890.
Remedies under the Article:
The competent court, upon due application by a judgment creditor of a
partner, is empowered to:
(1) Enter an order charging the interest of the debtor partner with
payment of the unsatisfied amount of the judgment debt as well as
the interest thereon
(2) Appoint a receiver of the debtor partners share of the profits any
other money due or to fall due to him in respect of the partnership
(3) Make all other orders, directions, accounts, and inquiries which the
debtor partner might have made, or which the circumstances of
the case may require
(4) Direct the sale of the interest charged
The two basic remedies are: (1) employment of a charging order and, this
proves inadequate, (2) the sale of the debtors interest in the partnership.
The other remedies serve simply as aids to these two basic remedies.
Example: Charging order may be effected through a receiver (who
receives the debtor-partners share in the profits) and the sale of
the interest may again be done by the receiver
Reach of Remedies
The above remedies can only reach the distributive share of the
debtor partner, i.e. his share of such profits as may from time to
time be distributed
These remedies cannot extend to the partnership assets
However, since any diminution of partnership assets automatically
entails a diminution of the profits due to a partner, a judgment
creditor may avail of every measure to prevent unauthorized or
illegal dissipation or transfer of partnership assets (e.g. nullify
mortgages, assignments)
Redemption or Purchase of Charged Interest
Partners may redeem or purchase the interest of a debtor partner
which is charged with satisfaction of the judgment of his creditor
Redemption or purchase may be made with the separate property
of one of the partners or with the partnership property (in the
latter case, all partners must consent)
Right to dissolve partnership
Redemption or purchase of the charged interest of a debtor partner
does not dissolve the partnership
But the mere sufferance by a partner of a charging lien on his
interest is a ground for the other partners to dissolve the
partnership under Art. 1830(c) CC.
REDEMPTION PURCHASE
Made at any time before sale or Exercised when sale of the charged
before the expiration of a interest is directed by the court
redemption period. Redemption
made after sale is discretionary on
the court
Merely advanced moneys for the Acquire the debtor partners interest
benefit of the debtor and holds the absolutely
interest in trust for him
3. To have access to partnership books
Article 1805. The partnership books shall be kept, subject to any agreement
between the partners, at the principal place of business of the partnership, and
every partner shall at any reasonable hour have access to and may inspect and
copy any of them.
Reasonable hour means any reasonable hour on business days
throughout the year and not merely during some arbitrary period
of a few days chosen by some or one of the partners.
4. To true and full information
Article 1806. Partners shall render on demand true and full information of all
things affecting the partnership to any partner or the legal representative of any
deceased partner or of any partner under legal disability.
5. To a formal account
Article 1809. Any partner shall have the right to a formal account as to
partnership affairs:
(1) If he is wrongfully excluded from the partnership business or possession of
its property by his co-partners;
(2) If the right exists under the terms of any agreement;
(3) As provided by article 1807;
(4) Whenever other circumstances render it just and reasonable.
General Rule: No partner has a right to demand a formal accounting
except as a consequence of dissolution or unless he at the same time
seeks dissolution of the partnership.
This is because he has equal access with his partners to the
partnership books
Exception: 4 circumstances in Art. 1809
6. To reimbursement of advancement and
indemnification of risks
Article 1796. The partnership shall be responsible to every partner for the
amounts he may have disbursed on behalf of the partnership and for the
corresponding interest, from the time the expense are made; it shall also answer to
each partner for the obligations he may have contracted in good faith in the
interest of the partnership business, and for risks in consequence of its
management.
Partnership shall be responsible to every partner for:
(1) Amounts he may have disbursed on behalf of the partnership and
for the corresponding interest, from the time the expenses are
made
(2) Obligations he may have contracted in good faith in the interest of
the partnership business
(3) For risks in consequence of its management
A partner has no obligation to loan or advance money to his firm.
If he does, he becomes a creditor of his firm and is entitled to
reimbursement for such loan or advance before there can be any
distribution of profits.
Any voluntary contribution of money or property for the use of the
partnership beyond the amount required to be contributed by the
partnership agreement is considered an advance or a loan.
Note: With respect to the above expenses, advances, risks and losses, a
partner, although he acts as agent of the partnership and his co-partners,
is not given the right of retention similar to that accorded to an ordinary
agent under Art. 1914, CC. The law subordinates the interest of the
individual partner to that of the entire firm.