PRIMELINK PROPERTIES AND DEVELOPMENT CORPORATION VS

LAZATIN
GR NO 167379 June 27, 2006
Callejo Sr

Facts:

Parties entered into a venture agreement wherein Lazatin will contribute their
two parcel of land while Primelink shall contribute labor, money, personnel
and the like. They agreed to a 60-40 basis for their profit. It was also
stipulated that in the event conflicting opinion shall occur, it shall be first be
referred to Voluntary arbitration. The possession to the land was then
transferred however, it was only after a year when Primelink obtained its
permit.

In 1997, Lazatin demanded Primelink to comply with its obligation but to no

avail. A second demand letter was sent ordering them to cease and desist
from further developing the land. Lazatin filed for the rescission of the
contract which ruled in their favor. The decision was affirmed by the Court of
Appeals.

Issue: whether or not rescission dissolved the partnership

Ruling: The court ruled in the affirmative.

The rescission of the Joint Venture Agreement undoubtedly dissolved the

partnership. Although Lazatin reacquired possession to said lands including
its improvements, such remained a partnership subject to the rights and
obligations of the partners to third persons. Until the winding up of the
partnership affairs is completed, only then will the parties can determine their
profit share, if any. Winding up affairs means satisfying the obligation of the
partnership to other parties.

The Supreme Court affirmed the decision of the Court of Appeals.