SANCHO vs.

LIZARRAGA
FACTS: This case is an action for rescission of a partnership contract entered into
between Maximilliano Sancho and Severiano Lizarraga on the ground that Lizarraga
failed to contribute all the capital he had bound himself to invest. Sancho also
wanted the reimbursement of his 50,000 peso share to the contribution.

Although the case was not yet appealable, Sancho is questioning the denial of the
lower court of his entitlement to rescind the contract of partnership and that Article
1142 is not applicable to this case.

ISSUE: Whether or not Sancho can rescind the contract of partnership on the ground
that his partner failed to contribute his capital he had bound himself to invest

HELD: The court held that Articles 1681 and 1682 of the Civil Code have been
properly applied. Owing to the defendant's failure to pay to the partnership the
whole amount which he bound himself to pay, he became indebted to it for the
remainder, with interest and any damages occasioned thereby.

Therefore, Sancho did not acquire the right to demand rescission of the partnership
contract according to article 1124 of the Code. This article cannot be applied to the
case in question, because it refers to the resolution of obligations in general,
whereas article 1681 and 1682 specifically refer to the contract of partnership in
particular. And it is a well known principle that special provisions prevail over general
provisions.