LAW ON PARTNERSHIP

Definition: ARTICLE 1767

- PAR. 1. By the contract of partnership two or more persons bind themselves

to contribute money, property, or industry to a common fund, with the

intention of dividing the profits among themselves.

- PAR. 2. Two or more persons may also form a partnership for the exercise of

a profession.

- Paragraph 2 relates to the exercise of the profession strictly means that the

practice of a profession is not a business or an enterprise for profit. However,

the law allows the joint pursuit thereof by two or more persons as partners.

Characteristic elements of partnership

The contract of partnership is:

- Consensual, because it is perfected by mere consent, that is, upon the

express or implied agreement of two or more persons;

- Nominate, because it has a special name or designation in our law;

- Bilateral, because it is entered into by two or more persons and the rights

and obligations arising therefrom are always reciprocal;

- Onerous, because each of the parties aspires to procure for himself a benefit

through the giving of something;

- Commutative, because the undertaking of each of the partners is considered

as the equivalent of that of the others;

- Principal, because it does not depend for its existence or validity upon some

other contracts;

- Preparatory, because it is entered into as a means to an end, i.e., to engage

in business or specific venture for the realization of profits with the view of

dividing them among the contracting parties.

o A partnership contract, in its essence, is a contract of agency. (see

Art. 1818.)