[PARTNER’S OBLIGATIONS TO PERSONAL AND PARTNERSHIP solidum with all their property for the results of the transaction

CREDITORS] made in the name and for the account of the partnership, under
03 PACIFIC COMMERCIAL v. ABOITIZ the signature of the latter, and by a person authorized to make use
March 2, 1926 | Ostrand, J. | thereof.
● The language of this article is clear and specific. On the other hand,
Petitioner: Pacific Commercial Company article 141, upon which Martinez relies and which provides that "losses
Respondent: Aboitiz & Martinez et al., Jose Martinez shall be computed in the same proportion among the capitalist partners
Doctrine: All the members of the partnership, be they or be they not without including the industrial partners, unless by special agreement
managing partners of the same are liable personally and in solidum with all the latter have been constituted as participants therein," is susceptible
their property for the results of the transaction made in the name and for the of two different interpretations.
account of the partnership with third parties. ● Article 141 relates merely to the distribution of losses among the
partners themselves in the settlement of the partnership affairs and
Facts: has no reference to partnership obligations to third parties.
● Arnaldo F. de Silva, Guillermo Aboitiz, Vidal Aboitiz and Jose Martinez ○ There is a marked distinction between a liability and a loss.
formed a "regular, collective, mercantile partnership" with a capital of The inability of a partnership to pay a debt to a third party
P40,000. at a particular time does not necessarily mean that the
○ Each of the partners Aboitiz and De Silva furnished one-third of partnership business as a whole, has been operated at a
the P40,000. loss.
○ Jose Martinez was an industrial partner and furnished no
capital; it was provided in the partnership article that he was to Dispositive
receive 30% of the profits and that his responsibility for losses The judgment appealed from is affirmed with the costs against the appellant.
should not exceed the amount of the profits received by him. So ordered.
● The partnership through Guillermo Aboitiz executed a promissory note
in favor of Pacific Commercial Company for P23,168.71.
○ As security, the partnership executed a chattel mortgage in
favor of Pacific on certain personal property
● For failure to pay, the chattel mortgage was foreclosed and the property
sold. P2,000 was paid to Pacific, but there remained an unpaid balance.
● Pacific brought an action for the recovery of the unpaid balance.
● Lower court: held in favor of Pacific, ordered partnership to pay
P27,951.68 and interest.
○ It further ruled that execution should first issue against the
property of the partnership, and in case of insolvency, against
the property of partners De Silva and Aboitiz, and in case of
their insolvency, then against the property of industrial partner
Jose Martinez.
● Martinez appealed, saying that an industrial partner cannot be held
responsible for the partnership’s debt.

Ruling:
W/N Martinez, an industrial partner, is liable for the partnership’s debt.
YES
● Article 127 of the Code of Commerce reads as follows:
All the members of the general co-partnership, be they or be they
not managing partners of the same are liable personally and in