Article 1800

The partner who has been appointed manager in the articles of partnership
may execute all acts of administration despite the opposition of his
partners, unless he should act in bad faith; and his power is irrevocable
without just or lawful cause. The vote of the partners representing the
controlling interest shall be necessary for such revocation of power.
A power granted after the partnership has been constituted may be
revoked at any time. (1692a)

Who manages the Partnership?

 The partnership will choose designated partner as managing partner either in the
articles of partnership or after the contract of partnership has already constituted.
If there is no agreement, management is vested in all partners.

Two Modes of Appointment

 Partner is appointed as manager in the Articles of partnership

GENERAL RULE
 Power is irrevocable without just or lawful cause.
EXCEPT;
 Vote of partners representing controlling interest necessary to
revoke power.
 To remove him without just cause, there must be unanimity
including his own vote.
EXTENT OF POWER
 Power of managing partner is IRREVOCABLE without
just/lawful cause. REVOCABLE ONLY when in acts in bad faith.
 He can do all acts of administration despite opposition of
partners if he acts in good faith.
 Partner is appointed as manager after constitution of partnership

GENERAL RULE
 The power to act may be revoked at any time, for any cause.

EXCEPT
 Vote of partners representing controlling interest necessary to
revoke power.
EXTENT OF POWERS
 The manager can do all acts of administration.
 Article 1801
If two or more partners have been intrusted with the management of the
partnership without specification of their respective duties, or without a
stipulation that one of them shall not act without the consent of all the
others, each one may separately execute all acts of administration, but if
any of them should oppose the acts of the others, the decision of the
majority shall prevail. In case of a tie, the matter shall be decided by the
partners owning the controlling interest. (1693a)

Who manages the Partnership?

 Two or more partners as managers
 There is no specification of respective duties.
 Two or more persons entrusted with management of partnership without
specification of duties that each shall not act without the consent of others.

GENERAL RULE
 Each one may separately execute all acts of
administration.

EXCEPT
 If any of the managers should oppose
 Incase of opposition, decision of majority shall prevail ( per
managing head).
 In case of tie, the decision of the managing partners
owning controlling interest who has more than 50 percent
shall prevail.

EXAMPLE
Assuming that A, B, C and D are all managing partners and A appoints E as
a secretary but only B OBJECTS to this.
 Is the appointment of E valid?
Yes, since majority votes are first counted by head.
If C&D were the ones to OBJECT, and they OWNED COMBINED total of 51% of
partnership interest
 Is the appointment of E valid?
No, Majority votes are first counted by head, however, it’s a tie. So the
decision will be by partnership Interest.

If B is the only one who OBJECTED and he OWNS 51% of partnership interest,
 Is the appointment of E valid?
Yes, despite of his partnership interest because majority votes are first
counted by head.

If the partnership cannot make a decision and ends up in a tie (head count
and interest), then the partnership is to be dissolved. This will be the only remedy,
unless one of the other partners will relent.
 Article 1802
In case it should have been stipulated that none of the managing partners
shall act without the consent of the others, the concurrence of all shall be
necessary for the validity of the acts, and the absence or disability of any
one of them cannot be alleged, unless there is imminent danger of grave or
irreparable injury to the partnership. (1694)

Stipulated that non of the managing partners shall acts without the consent of
others and the concurrence of all necessary for the validity of acts.
The only instance in which a partner may transact without concurrence is when
there is imminent danger of grave or irreparable damage to the partnership if he does
not do so. However, the party involved must be able to prove so else he shall become
liable for what he has done.

EXAMPLE
A and B are in a partnership where they sell fruits, B notices that the fruits in the
warehouse are starting to rot so, without consent of A, he sells them. This will be
alright because if the fruits rot, then it would have been bad on the part of the
partnership.
 Article 1803
When the manner of management has not been agreed upon, the following
rules shall be observed:
(1) All the partners shall be considered agents and whatever any one of
them may do alone shall bind the partnership, without prejudice to the
provisions of Article 1801.
(2) None of the partners may, without the consent of the others, make any
important alteration in the immovable property of the partnership, even if it
may be useful to the partnership. But if the refusal of consent by the other
partners is manifestly prejudicial to the interest of the partnership, the
court's intervention may be sought. (1695a)

 Manner of management not agreed upon

 All partners are agents of the partnership.
 Unanimous consent required for alteration of immovable property.
 If refusal of partner is manifestly prejudicial to interest of partnership, court's
intervention may be sought.

I. If there is no agreement as to who will be the managing partners,

during constitution and after constitution of the partnership, then the
assumption shall be that ALL the partners are managing partners, without
prejudice to Article 1801, meaning Article 1801 will then apply to their case.
II. The second paragraph of this article provides that the partners cannot simply
alter immovable property owned by the partnership without the consent of the
other partners because this is NOT an act of administration but of OWNERSHIP.

 Note that consent here is no qualified, so it may be expressed or

it may be implied.
EXAMPLE
Suppose before A builds the warehouse, he asks for the consent of the other
partners, who refuse to give it. When a tries to convince them and asks why they
refuse to give consent, they simply say that they do not want it to be there,
making their objection manifestly prejudicial, meaning, there is really no
reason for their objection, what then, is the remedy of A in this situation?
A may bring the matter to court. If the court finds the other partners of having no
solid reason to object, it may compel the other partners to give their consent.
PROBLEM
I. Article 1800 - There is two modes of appointment.
1. Appointment as manager in the Articles of partnership.
2. Appointment as manager made in an instrument other than the articles
of partnership.

II. Article 1801 - W, X, Y, Z are all managing partners. Z appoints A to sales. But
only X with a 60% partnership Interest OBJECTS the appointment. Therefore,
appointment of A will be INVALID.

III. Article 1802 - Stipulated that non of the managing partners shall acts without the
consent of others and the concurrence of all necessary for the validity of acts.

IV. Article 1803 - Partners, if there is no agreement as to who will be the managing
partner , will all be managing partners.

a.) TRUE,TRUE,TRUE,TRUE
b.) TRUE,FALSE,TRUE,TRUE
c.) FALSE,FALSE,FALSE,FALSE
d.) TRUE,FALSE,TRUE,FALSE

MCQ

1.) In article 1800, appointment as manager in the Articles of Partnership

A.) Is irrevocable without just or lawful cause.

B.) The power to act may be revoked at any time, for any cause
C.) Revocable when acts in GOOD FAITH.
D.) Is irrevocable even when the managing partner acts in BAD FAITH.
2.) In Article 1800, If Partner is appointed as manager after constitution of partnership,
the power to act may be revoked at any time, for any cause.

A.) I don't know

B.) Maybe
C.) True
D.) False

3.) In article 1801, what decision shall prevail first.

A.) Majority
B.) Highest partnership Interest
C.) Oldest partner
D.) Newest partner

4.) Which statement is True?

A.) Article 1802, everyone may act without the consent of the other partners.
B.) Article 1802, Non of the managing partner shall acts without the consent of others,
EXCEPT, if there is an imminent danger of grave or irreparable damage to the
partnership.
C.) Article 1803, Manner of management is agreed upon
D.) Article 1803, Partners may move property owned by partnership any time.

5.) Article 1803 says that the partners cannot simply alter immovable property
owned by the partnership without the consent of the other partners.

A.) True.
B.) False
C.) maybe
D.) I don't know