AURELIO K. LITONJUA, JR., vs. EDUARDO K. LITONJUA, SR, et al. (G.R. Nos. 166299-300.

December 13, 2005) FACTS: Petitioner and herein respondent are brothers. The legal dispute between them started when, Aurelio filed a suit against his brother Eduardo alleging that, since June 1973, he and Eduardo are into a joint venture/partnership arrangement in the Odeon Theater business which had accumulated various assets including but not limited to the corporate defendants and their respective assets. Also, the substantial assets of most of the corporate defendants consist of real properties. However, sometime in 1992, the relations between Aurelio and Eduardo became sour so that Aurelio requested for an accounting and liquidation of his share in the joint venture/partnership but to no avail. Petitioner has reasonable cause to believe that respondents are transferring various real properties of the corporations belonging to the joint venture/partnership to other parties in fraud of petitioner. ISSUE: WON petitioner and respondent are considered partners in the theatre, shipping and realty business. HELD: The instant petition is DENIED. A further examination of the allegations in the complaint would show that petitioners contribution to the so-called "partnership/joint venture" was his supposed share in their family business. In other words, his contribution as a partner in the alleged partnership/joint venture consisted of immovable properties and real rights. Lest it be overlooked, the contract-validating inventory requirement under Article 1773 of the Civil Code applies as long as real property or real rights are initially brought into the partnership. In context, the more important consideration is that real property was contributed, in which case an inventory of the contributed property duly signed by the parties should be attached to the public instrument, else there is legally no partnership to speak of. Considering that the allegations in the complaint showed that petitioner contributed immovable properties to the alleged partnership, the "Memorandum" which purports to establish the said "partnership/joint venture" is NOT a public instrument and there was NO inventory of the immovable property duly signed by the parties. As such, the said "Memorandum" is null and void for purposes of establishing the existence of a valid contract of partnership.

Angeles VS. Sec. Of Justice FACTS: On November 1992, Mercado convinced Angeles spouses to enter into a contract of antichresis (sanglaang-perde), covering 8 parcels of land planted with fruit-bearing lanzones trees located in Laguna and owned by Ivana Sazo. The said contract was to last for 5 years with P210,000 as consideration. Since during only the weekends are the spouses able to go to Laguna, Mercado administered the lands and completed the necessary paper works. Mercado gave accounting only in 1993 and stopped in the year 1995. They discovered that Mercado had put the contract of sanglaang-perde under Mercado and his spouses names. In Mercados counter affidavit, he alleged that there was (sosyo industrial) or industrial partnership agreement between them and that the Angeles spouses are the financiers and Mercado and his spouse as industrial partners. Under the industrial agreement, capital would come from the Angeles spouses while the profit would be divided evenly between Mercado and the Angeles spouses. In the ruling of the Provincial Prosecution Office, it stated that the accusation of estafa lacks enough credible evidentiary support to sustain a prima facie finding. The Angeles spouses appealed on the Secretary of Justice. It was ruled that the crime of estafa cannot be sustained. ISSUE: WON a partnership existed between Mercado and the Angeles spouses. HELD: There was an establishment of partnership between Mercado and the Angeles spouses. There is a contract showing industrial relationship and contribution of money and industry to a common fund, and the division of profits between Angeles spouses and Mercado. Furthermore, the Angeles spouses contributed money to the partnership and not immovable property and the mere failure to register the contract of partnership does not affect the liability of the partnership. The purpose of registration of the COP is to give notice to third parties. Failure to register the COP, does not affect the liability of the partnerships juridical personality. A partnership may exist even if the partners do not use the words partner or partnership.

Lilibeth Sunga Chan vs Lamberto Chua (G.R. No. 143340

August 15, 2001)

FACTS: In 1977, Lamberto Chua verbally entered into a partnership agreement with Jacinto L Sunga, father of petitioner, in the distribution of Shellane Liquefied Petroleum Gas (LPG) in Manila. For business convenience, respondent and Jacinto allegedly agreed to register the business name of their partnership, SHELLITE GAS APPLIANCE CENTER (hereafter Shellite), under the name of Jacinto as a sole proprietorship. Respondent allegedly delivered his initial capital contribution of P100,000.00 to Jacinto while the latter in turn produced P100,000.00 as his counterpart contribution, with the intention that the profits would be equally divided between them. Upon Jacinto's death in the later part of 1989, his surviving wife, petitioner Cecilia and particularly his daughter, petitioner Lilibeth, took over the operations, control, custody, disposition and management of Shellite without respondent's consent. Despite respondent's repeated demands upon petitioners for accounting, inventory, appraisal, winding up and restitution of his net shares in the partnership, petitioners failed to comply. Petitioner Lilibeth allegedly continued the operations of Shellite, converting to her own use and advantage its properties. On March 31, 1991, respondent claimed that after petitioner Lilibeth ran out the alibis and reasons to evade respondent's demands, she disbursed out of the partnership funds the amount of P200,000.00 and partially paid the same to respondent. Petitioner Lilibeth allegedly informed respondent that the P200,000.00 represented partial payment of the latter's share in the partnership, with a promise that the former would make the complete inventory and winding up of the properties of the business establishment. Despite such commitment, petitioners allegedly failed to comply with their duty to account, and continued to benefit from the assets and income of Shellite to the damage and prejudice of respondent. Trial court directed petitioner to render an accounting, to restitute to the partnership all properties, assets, income and profits they misapplied and converted to their own use and advantage, to pay the plaintiff earned but unreceived income and profits from the partnership from 1988 to May 30, 1992, ORDERING them to wind up the affairs of the partnership and terminate its business activities pursuant to law. CA affirmed the decision. ISSUES: WON there exists a partnership HELD: Decision is affirmed. Ratio Decidendi: A partnership may be constituted in any form, except where immovable property of real rights are contributed thereto, in which case a public instrument shall necessary.6 Hence, based on the intention of the parties, as gathered from the FACTS and ascertained from their language and conduct, a verbal contract of partnership may arise.7 The essential profits that must be proven to that a partnership was agreed upon are (1) mutual contribution to a common stock, and (2) a joint interest in the profits.