ESTOPPEL is a bar which precludes a person from denying or asserting anything contrary to that

which has been established as the truth by his own deed or representation, either express or
implied.

EQUITABLE INTEREST means all the beneficial interests of the property, such as the use thereof
and its fruits but not its title.

DISSOLUTION is the change in relation of the partners caused by any partner ceasing to be
associated in the carrying on of the business.

WINDING UP is the process of settling the business or partnership affairs after dissolution.

TERMINATION is the point in time when all the partnership affairs are completely wound up and
finally settled and it signifies the end of the partnership life.

A person has KNOWLEDGE OF A FACT within the meaning of this act not only when he has
actual knowledge thereof but also when he has knowledge of such other facts as in the
circumstances show bad faith.

A person has NOTICE OF A FACT within the meaning of this act when the person who claims the
benefit of the notice: states the fact to such persons or delivers through mail or by other means a
written statement of the fact to such person or to a proper person at his place of business or
residence.

ASSETS OF THE PARTNERSHIP are the partnership property and the contributions of the partners
necessary for the payment of all the liabilities.

LIMITED PARTNERSHIP is one formed by two or more person, having as members one or more
general partners and one or more limited partners and the limited partners shall not be bound
by the obligations of the partnership.

GENERAL PARTNER is personally liable for the partnership obligations

SUBSTITUTE LIMITED PARTNER is a person admitted to all the rights of a limited partner who has
died or has assigned his interest in a partnership.

PRESUMPTION OF GENERAL PARTNERSHIP - a partnership transacting business is a general
partnership

CONTRIBUTOR, unless he is a general partner, is not a proper party to proceedings by or against
a partnership, except where the object is to enforce a limited partners right against or liability to
the partnership.
He is practically a stranger in the limited partnership whose liability is limited to his interest in the
firm, without any right and power to participate in the management and control of the business.

PREFERRED LIMITED PARTNERS - by an agreement of all the members stated in the certificate,
preference may be given to some limited partners over other limited partners as to the: return of
their contributions, their compensation by way of income or any other matter.



ART. 1819
Conveyance of Real Property

1. Prima facie ownership of real property
2. Legal effects of conveyance
The real property may be registered or owned in the name of:
a. The partnership
b. One or more but not all the partners
c. One or more or all partners, or in a third person in trust for the partnership
d. All the partners

Rules in Conveyance of Real Property
1. Title in partnership name, conveyance in partnership name
2. Title in partnership name, conveyance in partners name
3. Title in name of one ore more partners, conveyance of partners in whose name title
stands
4. Title in name of one or more or all partners or a third person in trust for partnership,
conveyance executed in partnership name or in name of partner
5. Title in name of all partners, conveyance in name of all partners

ART. 1820
Admission by Partner
1. Admission by a party as testified to by a third person are admissible in evidence against
him in litigation
2. Admissions by another are received against a party if the former is acting in the capacity
of agent of the latter
3. When the partner makes admissions for himself only without purporting to act for the
partnership, he alone shall be chargeable with his admissions
4. After dissolution, admission made by a partner will bind the partnership only if necessary
to wind up partnership affairs

Effect of Admission of a Partner
1. The admission must concern partnership affairs
2. It must be made within the scope of the authority of the partner making the admission
3. It must be made during the existence of the partnership
4. The existence of the partnership must be shown by evidence other than by such
admission

ART. 1821
Notice to and Knowledge of a Partner

Notice to any partner relating to partnership affairs is notice to the partnership.

Knowledge of a Partner
1. Acting in the particular matter acquired while a partner
2. Acting in the particular matter then present to his mind
3. (of any other partner) who reasonably could and should have communicated it to the
acting partner

ART. 1822
Wrongful Acts of Partner/s

Requisites for liability
1. The partner must be guilty of a wrongful act or omission
2. He must be acting in the ordinary course of business or with the authority of his co-
partners even if the act is not connected with the business

ART. 1823
Breach of Trust

The partnership is bound to make good the loss:
1. Where one partner acting within the scope of his apparent authority receives money or
property of a third person and misapplies it
2. Where partnership in the course of its business receives money or property of a third
person and the money or property so received is misapplied by any partner while it is in
the custody of the partnership

ART. 1824
Solidary Liability of all the Partners to the Partnership

All partners are liable solidarily with the partnership for everything chargeable to the partnership
under Articles 1822 and 1823

ART. 1825
Partner by Estoppel

1. When a partnership liability results, he is liable as though he were an actual member of
the partnership
2. When no partnership liability results, he is liable pro rata with the other persons, if any, so
consenting to the contract or representation as to incur liability, otherwise separately.

Estoppel is a bar which precludes a person from denying or asserting anything contrary to that
which has been established as the truth by his own deed or representation, either express or
implied.


ART. 1826
Liability of Incoming Partner for Existing Obligations
1. Limited to his share in partnership for existing obligations
2. Extends to his separate property for subsequent obligations

ART. 1830
Dissolution is caused:
1. Without violation of the agreement between partners
a. By the termination of the definite term specified in the agreement
b. By the express will of any partner
c. By the express will of all the partners
d. By the expulsion of any partner from the business
2. In contravention of the agreement between the partners
3. By any event which makes it unlawful for the business of the partnership to be carried on
or for the members to carry it on in partnership
4. When a specific thing, which a partner had promised to contribute in the partnership,
perishes before delivery
5. By the death of a partner
6. By the insolvency of a partner
7. By the civil interdiction of any partner
8. By the decree of court under articles 1700 and 1701

ART. 1831
On application by or for a partner, the court shall decree dissolution whenever:
1. A partner has been declared insane in any judicial proceeding or is shown to be of
unsound mind
2. A partner becomes in any other way incapable of performing his part of the partnership
contract
3. A partner has been guilty of such conduct as tends to affect prejudicially the carrying on
of the business
4. A partner willfully or persistently commits a breach of the partnership agreement
5. The business of the partnership can only be carried on at a loss
6. Other circumstances render a dissolution equitable

On the application of the purchaser of a partnerships interest:
1. After the termination of the specific term or particular undertaking
2. At any time if the partnership was a partnership at will when the interest was assigned on
when charging order was issued

Grounds for Dissolution by Decree of Court
1. On application by a partner:
a. Insanity
b. Incapacity
c. Misconduct and persistent breach of partnership agreement
d. Business can be carried on only at loss
e. Other circumstances

ART. 1832
Dissolution terminates all authority of any partner:
1. With respect to the partners
a. When the dissolution is not by act, insolvency or death of a partner
b. When the dissolution is by such act . . .
2. With respect to persons not partners

ART. 1833
Authority of partners as among themselves to act for the partnership:
1. The cause of the dissolution is the act of a partner and the acting partner had
knowledge of such dissolution
2. The cause of the dissolution is the death or insolvency of a partner and the acting

ART. 1834
After dissolution a partner can bind the partnership, except:
1. By an act appropriate for winding up partnership affairs or completing transactions
unfinished at dissolution
2. By any transaction which would bind the partnership if dissolution had not taken place

Liability of partner shall be satisfied:
1. Unknown as a partner to the person with whom the contract is made
2. So far unknown and inactive in partnership affairs that the business reputation of the
partnership could not be said to have been in any degree due to his connection with it

The partnership is in no case bound by any act of partner:
1. Where the partnership is dissolved because it is unlawful to carry on the business
2. Where the partner has become insolvent
3. Where the partner had no authority to wind up partnership affairs

Notice of dissolution to creditors
1. As to persons who extended credit to partnership prior to dissolution
2. As to persons who had known of partnerships existence
3. Where acting partner has no authority to wind up partnership affairs
4. Where acting partner has become insolvent

ART. 1836
Manner of Winding Up
1. Judicially, under the control and direction of the proper court upon cause shown by any
partner, representative or assignee
2. Extrajudicially, by the partners themselves without intervention of court

Persons Authorized to Wind Up
1. Partners designated by the agreement
2. In the absence of such agreement, all the partners who have not wrongfully dissolved
the partnership
3. The legal representative of the last surviving partner, not insolvent

ART. 1837
Rights of partner when dissolution is caused by agreement contravention:
1. Each partner who has not caused dissolution wrongfully shall have:
a. All the rights specified in the first paragraph
b. The right as against each partner who has caused the dissolution wrongfully to
damages for breach of the agreement
2. Partners who have not caused dissolution wrongfully if they all desire to continue the
business in the same name may do so
3. A partner who has caused the dissolution wrongfully shall have:
a. All the rights except liability for damages
b. The right against his co-partners and all claiming through them in respect of their
interest

Right of partner to application of partnership property on dissolution:
1. Without violation of partnership agreement
2. In violation

Rights where dissolution not in contravention of agreement:
1. To have the partnership property applied to discharge the liabilities of the partnership
2. To have the surplus applied to pay in cash the net amount owing to the respective
partners

Rights in contravention:
1. Not wrongfully:
a. To have partnership property applied for the payment of liabilities and to receive
cash his share of surplus
b. To be indemnified for damages caused by the guilty partner
c. To continue the business in the same name
d. To possess partnership property should they decide to continue the business
2. Wrongfully:
a. To have the partnership property applied to discharge its liabilities and to receive
surplus in cash less the damages he caused
b. To have the value of his interest in the partnership ascertained and paid in cash
c. To be released from all existing and future liabilities of the partnership

ART. 1838
Partnership contract is rescinded on the ground of fraud/ Rights of injured partner:
1. To a lien on, or right of retention of, the surplus of the partnership property after satisfying
the partnership liabilities
2. To stand after all liabilities have been satisfied
3. To be indemnified by the person guilty of the fraud

ART. 1839
Settling accounts after dissolution:
1. Assets of the partnership are:
a. The partnership property
b. The contributions of the partners necessary for the payment of liabilities
2. The liabilities of the partnership shall rank in order of payment:
a. Those owing to creditors other than partners
b. Those owing to partners other than capital and profits
c. Those owing to partners in respect of capital
d. Those owing to partners in respect of profits
3. The assets shall be applied in order of their declaration to the satisfaction of the liabilities
4. The partners shall contribute the amount necessary to satisfy liabilities
5. An assignee for the benefit of the creditors shall have the right to enforce the
contributions specified
6. Any partner shall have the right to enforce the contributions
7. The individual property of a deceased partner shall be liable for the contributions in No. 4



ART. 1843
Characteristics of Limited Partnership
1. Formed by compliance with statutory requirements
2. One or more general partners control the business and are personally liable to creditors
3. One or more limited partners contribute to the capital and share in the profits but do not
participate in the management of business and are not liable for obligations beyond
their capital contributions
4. Limited partners may ask for the return of their capital contributions
5. Partnership debts are paid out of the common fund and the individual properties of the
general partners

Business reason for formation of limited partnership
1. Secure capital from others for ones business and still retain control
2. Share in profits of a business without risk of personal liability

DIFFERENCES BETWEEN GENERAL AND LIMITED PARTNERS

G. personally liable for partnership obligations
L. extends to his capital contributions only

G. have equal right in the management of business
L. no share in management of the partnership

G. may contribute money, property or industry
L. must contribute cash or property but not services

G. proper party proceedings
L. not a proper party proceedings

G. interest in the partnership may not be assigned as to make assignee a new partner without
the consent of other partners
L. interest is freely assignable

G. name shall appear in the firm name
L. must not

G. prohibited from engaging in other business the same as the partnership business
L. no prohibition

G. death, insolvency, insanity retirement dissolves partnership
L. retirement, etc. does not have the same effect


DIFFERENCES BETWEEN GENERAL AND LIMITED PARTNERSHIP

G. constituted in any form by contract
L. created by the members

G. composed only of general partners
L. must operate under a firm name which in the case of a limited partnership must be followed
by the word Limited

G. and L. dissolution and winding up are governed by different rules


ART. 1844
Two or more persons desiring to form a limited partnership shall:
1. Sign and swear to a certificate which shall state:
a. The name of the partnership adding the word limited
b. The character of the business
c. The location of the principal place of the business
d. The name and place of residence of each member, general and limited partners
being respectively designated
e. Term for which the partnership is to exist
f. Amount of cash and description of and the agreed value of the other property
contributed by each limited partner
g. Additional contributions made by each limited partner and the times on the
happening of which they shall be made
h. The time when the contribution of each lmtd partner is to be returned
i. The share of profits or other compensation by way of income which each lmtd
partner shall receive
j. The right of a limited partner to substitute an assignee as contributor in his place
k. The right of the partners to admit additional limited partners
l. The right of one or more of limited partners to priority over other limited partners
m. The right of the remaining general partner to continue the business on death,
retirement, etc.
n. The right of a limited partner to demand and receive property other than in cash
return
2. File for record the certificate in the office of SEC


ART. 1845
Limited partners contribution
1. Medium
2. Time

ART. 1846
Surname of the limited partner shall not appear in partnership name unless:
1. It is also the surname of a general partner
2. Prior to the time when the limited partner became such, the business had been carried
under a name in which his surname appeared

ART. 1847
Party may be held liable if the statement is false:
1. At the time he signed the certificate
2. Subsequently but within a sufficient time before the statement was relied upon to enable
him to cancel or amend the certificate

Requisites liability for false statement
1. He knew the statement to be false at the time he signed the certificate but having
sufficient time to amend it
2. Person seeking to enforce liability has relied upon the false statement
3. Person suffered loss as a result of reliance upon such false statement

ART. 1850
General partners have no authority to:
1. Do any act in contravention of certificate
2. Do any act which would make it impossible to carry on the ordinary business of the
partnership
3. Confess a judgment against the partnership
4. Possess partnership property
5. Admit a person as a general partner
6. Admit a person as a limited partner
7. Continue the business with the partnership property on death, etc.

ART. 1851
Limited partner shall have the same rights as a general partner to:
1. Have the partnership books kept at the principal place of business and to inspect at
reasonable hour
2. Have on demand true and full info of all the things affecting the partnership
3. Have dissolution and winding up by decree of court

SPECIFIC RIGHTS:
1. Require the partnership books be kept at the principal place of the business
2. Inspect and copy partnership books at reasonable hour
3. To demand true and full info of all the things affecting the partnership
4. To demand formal account of partnership affairs whenever circumstances render it just
and reasonable
5. To ask for dissolution and winding up by the decree of law

ART. 1854
No limited partner shall in respect to any such claim:
1. Receive or hold as collateral security any partnership property
2. Receive from a general partner conveyance or release of liability

Loan and other business transactions
1. Allowable transactions
a. Granting loans to the partnership
b. Transacting other business with it
c. Receiving pro rata share of the partnership assets with general creditors
2. Prohibited transactions
a. Receiving or holding as collateral security any partnership property
b. Receiving any payment, conveyance or release form liability
3. Preferential rights to third persons

ART. 1855
Preferred limited partners:
1. Return their contributions
2. Their compensation by way of income
3. Any other matter

ART. 1856
Compensation of limited partner
1. Excess of partnership assets over partnership liabilities
2. Preferential rights of partnership creditors

ART. 1857
Requisites for return of contribution
1. All liabilities have been paid or assets are sufficient to pay them
2. The consent of all the members has been obtained
3. Certificate is cancelled to set froth withdrawal of the contribution

When return is a matter of right
1. On the dissolution of the partnership
2. Upon the arrival of the date specified in the certificate for return
3. After the expiration of the six months notice in writing

Right of limited partner to cash in return
1. When there is stipulation to the contrary in the certificate
2. Where all partners consent the return

ART 1858.
Limited partner is liable to the partnership:
1. For the difference between his contribution as actually made and that stated in the
certificate
2. For any unpaid contribution which he agreed in the certificate to make in the future
Limited partner holds as trustee
1. Specific property stated in the certificate as contributed but not
2. Money or ay other property wrongfully paid or conveyed to him

Requisites for waiver or compromise
1. Waiver is made with the consent of all the partners
2. Waiver does not prejudice partnership creditors who extended credit before
amendment of the certificate

ART. 1859
Rights of assignee of limited partner
1. Assignee is only entitles to receive the share of profits
2. Assignee acquires all the rights only when he become a substituted limited partner

ART. 1860
Death, etc. dissolve the partnership:
1. Under the right so to do stated in the certificate
2. With the consent of all the members

ART. 1863
Settling accounts after dissolutions
1. Those to creditors
2. To limited partners in respect to their share of profits
3. To limited partners in respect to the capital
4. Those general partners other than for capital and profits
5. General partners in respect to profits
6. In respect to capital

ART. 1864
Certificate shall be amended when:
1. There is a change in the name of the partnership or in amount or character of
contribution
2. Person is substituted as limited partner
3. An additional limited partner is admitted
4. A person is admitted as general partner
5. A general partner retires, etc and the business is continued
6. There is a change in the character of the business
7. There is a false statement in the certificate
8. There is a change in the time stated for the dissolution or return of contribution
9. A time is fixed for dissolution
10. The members desire to make a change

Shall be cancelled:
1. When the partnership is dissolved other than the reason of the expiration of the term of
the partnership
2. When all limited partners cease to be such

ART. 1865
The writing to amend a certificate shall:
1. Must be in writing
2. Must be signed and sworn by all the members, old and new, assigning limited or
substituted
3. Must be filed in SEC