Munasque vs Court of Appeals

GR No L 39780 November 11, 1985

Guttierez

Facts:

Petitioner entered into a contract with respondent, Tropical for the remodeling
of its building without any consideration from Galan although he is names a
partner in the contract. The construction started and Tropical started to issue
checks to petitioner. However, in 1967, the checks were issued to Galan. Due
to such, petitioner undertook the construction in his own expense. Due to the
unauthorized disbursement, petitioner demanded said checks given to Galan
to be issued to him.

The lower court held that Munasque and Galan shall jointly pay Cebu and
Southern Hardware company, Blue Glass palace and a third party. The Court
of Appeals affirmed the decision.

Issue: whether or not Munasque and Galan shall be solidarily liable

Ruling: The Court ruled in the affirmative.

The court ruled that evidence clearly show that there is indeed a partnership,
as already shown in the contract. The misunderstanfing alleged does not ipso
facto make the partnership a sham. Moreover, Tropical would not have issued
the checks to Galan if not due to the partnership, hence, the disbursement by
Tropical is valid and binding. Since they are partners when they incurred the
debt, they shall be solidarily liable to the third parties who extended credit to
their partnership.

As between the partners, Galan shall reimburse Munasque for the payments
made by him representing the liablity of their partnership to the third parties
mentioned, as it was also satisfactorily established that Galan acted in bad
faith in his dealing with his partner, Munasque.

Due to the forgoing, the Supreme Court affirmed the decision.