Evangelista & Co. vs.

Santos

Case G.R. No. L-31684

Ponente

MAKALINTAL, Actg., C .J

Decision Date (28 June 1973)

A dispute arises between partners in a co-partnership over the distribution of profits and access to partnership
information, leading to a court ruling in favor of the industrial partner and ordering an accounting of the partnership's
business operations.

BACKGROUND AND FORMATION OF THE CO-PARTNERSHIP

-The case involves a dispute between partners in a co-partnership named "Evangelista & Co."

- The co-partnership was formed on October 9, 1954.

- On June 7, 1955, the Articles of Co-partnership were amended to include Estrella Abad Santos as an industrial partner.
The original capitalist partners, Domingo C. Evangelista, Jr., Leonarda Atienza Abad Santos, and Conchita P. Navarro,
remained as capitalist partners.

- Estrella Abad Santos' contribution to the partnership was her industry as an industrial partner. The profits and losses
were to be divided among the partners, with 70% for the first three partners and 30% for Estrella Abad Santos.

LAWSUIT AND ALLEGATIONS

- In December 1963, Estrella Abad Santos filed a lawsuit against the other partners in the Court of First Instance of
Manila.

- She alleged that the partnership had been paying dividends to the partners except for her.

- She claimed that the defendants had refused to let her examine the partnership books or provide her with information
about the partnership affairs.

- Estrella Abad Santos requested an accounting of the partnership's business operations and her corresponding share in
the profits, as well as attorney's fees and costs.

DEFENDANTS' DENIAL AND COUNTERARGUMENTS

The defendants denied declaring dividends or distributing profits. They claimed that the amended Articles of Co-
partnership did not reflect the true agreement of the parties. The defendants argued that Estrella Abad Santos was not
an industrial partner and that her share of 30% was based on the profits until the partnership's loan was fully paid.

DECISION OF THE COURT OF FIRST INSTANCE

• The Court of First Instance ruled in favor of Estrella Abad Santos.

The court declared her an industrial partner and ordered the defendants to render an accounting of the partnership's
business operations.

The defendants were also ordered to pay Estrella Abad Santos her share in the profits, attorney's fees, and costs.
APPEAL TO THE COURT OF APPEALS

• The defendants appealed the decision to the Court of Appeals.

The Court of Appeals affirmed the decision of the lower court.

PETITION TO THE SUPREME COURT

-The defendants filed a petition before the Supreme Court, raising several errors in the decision of the Court of Appeals.

-The Supreme Court noted that the main issue in the case was whether Estrella Abad Santos was an industrial partner or
a profit sharer.

-The Court stated that its role was limited to reviewing errors of law and would not reanalyze the evidence presented by
the parties.

AFFIRMATION OF THE COURT OF APPEALS' DECISION

-The Court of Appeals had thoroughly analyzed the evidence and found that Estrella Abad Santos was an industrial
partner based on the documentary evidence and her testimony.

-The Court of Appeals also considered the fact that the defendants had not taken any action to correct the alleged false
agreement until after the filing of the lawsuit.

- The Supreme Court affirmed the decision of the Court of Appeals, stating that there was no reason to depart from the
rule that limits its jurisdiction to reviewing errors of law.

- The judgment of the Court of Appeals was affirmed, and the defendants were ordered to pay the costs of the suit.

SUMMARY AND CONCLUSION

The case involved a dispute between partners in a co-partnership, with the main issue being whether one of the
partners was an industrial partner or merely a profit sharer.

The Court of Appeals affirmed the lower court's decision declaring the partner as an industrial partner and ordering an
accounting of the partnership's business operations.

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

Marsman Drysdale Land, Inc. vs. Philippine Geoanalytics, Inc.
Case
G.R. No. 183374 & 183376
Ponente
CARPIO MORALES, J
Decision Date (29 June 2010)
A joint venture agreement between Marsman Drysdale Land, Inc. and Gotesco Properties, Inc. for the
construction of an office building leads to a legal battle with Philippine Geoanalytics, Inc. over unpaid services,
resulting in both companies being held jointly liable and ordered to pay with interest.

PARTIES INVOLVED AND AGREEMENT DETAILS

- Marsman Drysdale Land, Inc. (Marsman Drysdale)
- Gotesco Properties, Inc. (Gotesco)
- Joint venture agreement for the construction of an office building in Makati City, Philippine.
- Marsman Drysdale to contribute the land.
- Gotesco to contribute the cash for the project
- Funding for the project to be obtained from Gotesco's cash contribution.
- Marsman Drysdale not obligated to fund the project

ENGAGEMENT OF PHILIPPINE GEOANALYTICS, Inc. (PGI)

- PGI hired to provide subsurface soil exploration, laboratory testing, seismic study, and geotechnical
engineering for the project.
- PGI unable to complete all services due to failure of joint venture partners to clear the area for drilling.
- PGI bills joint venture for services rendered, but payment is not made

COMPLAINT AND TRIAL COURT DECISION

- PGI files complaint for collection of sum of money and damages against Marsman Drysdale and Gotesco.
- Trial court rules in favor of PGI and orders both companies to pay PGI jointly.
- Marsman Drysdale argues it should not be held jointly liable and claims PGI did not fulfill its obligations
- Gotesco claims it is not liable due to Marsman Drysdale's failure to clear the property
COURT OF APPEALS DECISION
- Court of Appeals affirms trial court's decision with modifications. Exemplary damages and attorney's fees are
deleted from the award.
,- Court holds joint venture partners jointly liable to PGI, regardless of terms of joint venture agreement.
- Principle of joint liability under law on partnership applied. Obligation divided between Marsman Drysdale
and Gotesco based on agreed ratio of 50-50.

SUPREME COURT DECISION

- Supreme Court affirms Court of Appeals' decision with further modifications Marsman Drysdale and held
jointly liable to PGI.
No need for Gotesco to reimburse Marsman Drysdale. Interest rate of 12% per annum imposed on
outstanding obligation from time of demand.
- Marsman Drysdale's claim for attorney's fees denied
- Marsman Drysdale not compelled to litigate and could have advanced funds to pay PGI's obligations.
Uy vs. Puzon Case G.R. No. L-19819 Ponente
CONCEPCION, JR., J
Decision Date
26 Oct 1977

A partnership dispute arises when one partner fails to contribute their share and misapplies partnership
funds, leading to the dissolution of the partnership and a court ruling in favor of the other partner,
entitling them to reimbursement for their investments and a share in the unrealized profits. Facts Digest
Summary Jurisprudence Similar Translate Background of the Case The case involves a partnership dispute
between William Uy and Bartolome Puzon. Puzon had a contract with the Republic of the Philippines for
the construction of a road and bridges. Puzon sought financial assistance from Uy and they agreed to form
a partnership. The partnership agreement stated that the profits would be divided equally between them.
Uy invested a significant amount of money into the partnership, while Puzon failed to contribute his share
and misapplied partnership funds. Uy's Demand for Fulfillment of Obligations As the construction projects
progressed, Uy found it difficult to obtain the necessary funds to continue the construction. Uy demanded
that Puzon fulfill his obligations under the partnership agreement. However, Puzon failed to contribute his
share and did not fulfill his obligations. Puzon eventually terminated the sub-contract agreement with the
partnership and continued the projects alone, effectively ousting Uy from the management of the firm.
Uy's Lawsuit and Trial Court Decision Uy filed a lawsuit against Puzon, seeking the dissolution of the
partnership and payment of damages. The trial court found in favor of Uy. The court ruled that Puzon had
breached the partnership agreement by failing to contribute his share and misapplying partnership funds.
The court ordered the dissolution of the partnership. The court also ordered Puzon to reimburse Uy for his
investments and share in the unrealized profits of the partnership. Puzon's Appeal and Appellate Court
Decision Puzon appealed the trial court's decision. The appellate court upheld the trial court's ruling. The
court found that Puzon had indeed failed to contribute his share and misapplied partnership funds. The
court also determined that Uy had made significant investments in the partnership and was entitled to
reimbursement. Additionally, the court awarded Uy a share in the unrealized profits of the partnership.
Importance of Fulfilling Obligations in a Partnership Agreement The case highlights the importance of
fulfilling obligations in a partnership agreementm Puzon's failure to contribute his share and misapply
partnership. funds led to the dissolution of the partnership and legal consequences. Partners have a duty
to fulfill their obligations and failing to do so can result in legal action. Rights of Partners to
Reimbursement and Share in Profits The case emphasizes the rights of partners to reimbursement for their
investments. Uy was entitled to be reimbursed for his investments in the partnership. Partners also have a
right to a share in the profits of the partnership. Uy was awarded a share in the unrealized profits of the
partnership. Conclusion The case of Uy v. Puzon highlights the importance of fulfilling obligations in a
partnership agreement and the consequences of failing to do s0. It also emphasizes the rights of partners
to reimbursement for their investments and a share in the profits of the partnership .