Partnership – Civil Code (Title IX)

Contract where persons contribute money, property, or industry to a common fund intending to divide profits.
Has a juridical personality separate from the partners.

Sharing of profits = prima facie evidence of partnership unless profits are received as debt, wages, rent, annuity, interest, or price of goodwill.
Co-ownership, co-possession, or sharing gross returns alone does not . create partnership.

Lawful object and common benefit required; unlawful purpose -> void & profits forfeited. '
Any form allowed; contribution of immovables requires public instrument + inventory.
Capital ≥ $3{,}000$ must appear in public instrument and be recorded with SEC.
Failure in form does not affect liability to third persons.

By object: universal (all present property or only profits) vs. particular (specific things, undertaking, or profession).
By liability: general vs. limited.

Partnership begins on execution unless stipulated otherwise.
Each partner debtor for promised contribution; money default bears interest & damages from due date.
Industrial partner barred from competing; violation allows exclusion or , appropriation of benefits with damages.
Partners contribute equal shares by default; may be forced to sell interest if refusing additional capital to save imminent loss.
Losses/profits per agreement; lacking agreement → proportionate to contribution; industrial partner shares profits equitably, not losses..
Partner at fault liable for damages but courts may mitigate if unusual profits gained.
Partnership reimburses partners for expenses, obligations, and risks assumed in good faith.

Manager named in articles: irrevocable power unless bad faith or revoked by partners holding controlling interest.
Several managers w/ no specific duties: each may act; opposition resolved by majority.
Stipulated unanimity → all consents required unless urgent danger.
Absent agreement: every partner is agent; major alterations in immovables require consent or court intervention.
Books kept at principal place; every partner may inspect.

Rights: (1) specific partnership property, (2) interest in partnership (profits/surplus), (3) share in management.
Specific property: equal right of possession for partnership purposes; not assignable separately; not subject to personal attachment.
Partner’s transferable interest: assignee gets assignor’s share of profits & surplus; no management rights.
Judgment creditor may secure charging order over partner’s interest; redemption allowed.

Firm name required; outsiders using name incur partner liability.
All partners (incl. industrial) liable pro rata with all property after partnership assets exhausted for contracts made under authority.
Every partner is agent; acts in usual course bind partnership unless no authority & third party has knowledge.
Enumerated acts (e.g., confessing judgment, disposing goodwill) need unanimous consent.
Admissions, notices, wrongful acts, and misapplication of property by partner within authority bind partnership; partners & partnership liable solidarily for torts.
Partner by estoppel liable to those who gave credit on representation.
Incoming partner liable for prior obligations only out of partnership property unless agreed otherwise.
Partnership creditors preferred over individual creditors on partnership assets.

Dissolution = change in relation when a partner ceases; partnership continues for winding up.
Causes include: expiration of term/undertaking, will of any partner, agreement, illegality, loss of specific thing, death, insolvency, civil interdiction, court decree.
Authority terminates upon dissolution except for winding up or completing unfinished transactions.
Acts after dissolution can still bind partnership under specified conditions (e.g., lack of notice to third party).
Partners not causing wrongful dissolution may apply assets to liabilities and receive net shares; wrongful partner liable for damages.
Settlement order: (1) outside creditors, (2) partner advances, (3) partner capital, (4) partner profits.

Formed by certificate (must state key particulars) filed with SEC; name must include “Limited”.
Limited partners contribute cash/property (not services) and are not bound by obligations if they do not control business.
Surname of limited partner in firm name creates general-partner liability unless exceptions apply.
Limited partner may inspect books, demand information, share profits, and receive return of contribution subject to asset sufficiency.
Liability limited to contribution unless he participates in control, allows false certificate, or fails to contribute agreed amount.
Interest assignable; assignee becomes substituted limited partner only with consent & certificate amendment.
Death, insolvency, etc. of general partner dissolves partnership unless continuation right exists or all consent.
Order on liquidation: outside creditors → limited partners (income then capital) → general partners (advances, profits, capital).