PERSONS PROHIBITED FROM GIVING DONATIONS

- Cannot enter into UP

- Husband and wife (Art 87 FC)
- Common law spouses (Art 87 FC)
XPN: Can enter into professional pship (Property not affected, Art 73 FC)
Apart from professional partnership, Spouses cannot enter into any form of partnership, be it universal
or particular, general or limited partnership, as a separate property arrangement apart from the
property regime prevailing in their marriage.
To cut it short, the reason why they cannot enter into partnership are;

First, Contributions in partnership effectively makes the partners “Donors” to one another…
What you cannot do directly you cannot do indirectly
Second, it is clear implication under the FAMILY CODE, that the property regime that must govern
spouses must be in accordance with the provisions of Said Code, and cannot be subject of Regular
partnership rules under the Partnership Law.

Can Husband and Wife validly enter into a professional partnership ( particular partneship)

A: yes, the reason is that the professional partnerships essential covers the contribution of service by
the spouses, and DOES NOT PRIMARILY bind actual community or conjugal properties, and therefore
does not operate in violation of the property rules governing marriage property regimes.

Art. 73. of Family Code

“Either spouses may exercise any legitimate profession, occupation, business or activity without the
consent of the other. “

Properties are not affected in professional partnership.

Practice of profession is not intended for profit, it is intended for rendering service.

2 types of pship under 1767

1. For profit/gain
2. For professional pships

Article 1782. Persons who are prohibited from giving each other any donation or advantage cannot
enter into universal partnership.

- Reason: Contract of pship likened to contract of donation

Can a corp qualify to become partner?

There is conflict of mutual agency.

- OLD ANSWER: No unless authorized by charter. A corporation cannot ordinarily enter into
partnership with other corporations or with individuals, for, in entering into partnership, the
identity of the corporation is lost or merged with that of another.
- And the direction of affairs of corp is placed in other hands than those provided by law of its
creation
- Corp managed by the board of directors only unlike in pship where partners manage
- In pship there is mutual agency
-
- HOWEVER corp can enter into joint venture agreement or consortium because here there is no
mutual agency. The act of one will not bind the other, thus, in that sense a Corp can enter into
agreement.

… BUT WITH THE AMENDMENT OF REVISED CORP CODE: SEC. 35 Corp now has power and capacity to
enter a partnership, joint venture, merger, consolidation, or any other commercial agreement with
natural and juridical persons;

OTHER CLASSES OF Partnership

As to liability of partners: General or Limited

1. General Partnership (1816,1822-1824) – one consisting of general partners who are liable pro
rata and subsidiariliy, sometimes solidarily with their separate prop for pship debts if so stated
Subsidiarily means creditors should exhaust part property to satisfy the credit before going to the
partners.

2. Limited – Article 1843. A limited partnership is one formed by two or more persons under the
provisions of the following article, having as members one or more general partners and one
or more limited partners. The limited partners as such shall not be bound by the obligations
of the partnership.
In a limited partnership, it must be formed by one or more general partners who is liable up to
the extent of his separate property and one ore more limited partners who are liable only up to
the extent of their contribution.
- Limited pship must have at least one general partner; it cannot be that all of them are limited
partners (Reason: Partners are bound with unlimited liability)
Partnership is compose by one or more sole proprietors they have to be liable up to their separate
property.
AS TO DURATION: At will v. with fixed term

- Pship at will – one in which no time specified and it is formed for particular undertaking or
venture and which may be terminated anytime by mutual agreement of partners, or by will of
one partner alone, or one for fixed term or particular undertaking which is continued by
partners after termination of such term or particular undertaking without express agreement
No specified time or duration
- Pship with fixed term – one in which term for which pship is to exist is fixed or one formed for
particular undertaking and upon expiration of term of completion of particular enterprise, pship
si dissolved UNLESS CONTINUED BY PARTNERS JUST LIKE PSHIP AT WILL

AS TO LEGALITY OF EXISTENCE: DE JURE v DE FACTO

- De jure: one which has complied with all legal requirements for its establishement.
3 instances:

Article 1772. Every contract of partnership having a capital of three thousand pesos or

more, in money or property, shall appear in a public instrument, which must be recorded in
the Office of the Securities and Exchange Commission.

Failure to comply with the requirements of the preceding paragraph shall not affect the
liability of the partnership and the members thereof to third persons. (n)

Article 1773. A contract of partnership is void, whenever immovable property is contributed

thereto, if an inventory of said property is not made, signed by the parties, and attached to
the public instrument.

In case of limited partnership it has to be in wrting and registered in Sec.

Purpose of registration id to inform the public that in this partnership there are partners that have
limited liability. Just a warning or information to the public.

- De facto: one which failed to comply strictly with all legal requirements for its establishment
- GR: A de facto pship is not void; a de facto pship has juridical personality Art 1772 par 2
- Only it failed to comply with legal reqs such as registration with SEC
- But its legal existence can be questioned
A defacto partnership is not a void partneship it has also a juridical personality. The only
problem is it just failed to comply with the legal requirements.
It does not affect juridcal personality, but its legal existence can only be questioned

- XPN:
a. What is contributed is immovable property (PIECE OF LAND) and no inventory, pship is void
and thus no juridical personality.
b. Unlawful object/purpose, void pship and thus no juridical personality
Defacto partnership entered into bus

Status of business entered into by de facto pship

- Valid. Acts of de facto valid

- What can only be questioned is legality of existence of de facto pship