YULO VS. YANG CHIACO SENG, L-12541, AUG. 28, 1959
LABRADOR,
J.:
[No. L-12541. August 28, 1959]
Parties:
YANG CHIAO SENG,
defendant and appellee.
Nature: APPEAL
from a judgment of the Court of First Instance of Manila.
Keyword: circumstance that negate partnership
Facts:
On June 17, 1945, defendant Yang Chiao Seng proposed a partnership to the plaintiff
Mrs. Rosario U. Yulo, to run and operate a theatre in Manila. In their
agreement, the principle agreement was that (1)Yang Chiao Seng shall pay Mrs.
Yulo a monthly participation of P3,000, (2) that the partnership shall be for a
period of two years.and six months, with the condition that if the land is
expropriated, rendered impracticable for the business, or if the owner
constructs a permanent building thereon, or Mrs. Yulo's right of lease is
terminated by the owner, then the partnership shall be terminated even if the
period of partnership has not yet expired; (3) that Mrs. Yulo may conduct such
business in the lobby of the building as is ordinarily carried on in lobbies of
theatres in operation, provided the said business may not obstruct the free
ingress and egrees of patrons of the theatre; (4) that after December 31, 1947,
all improvements placed by the partnership shall belong to Mrs. Yulo, but that
if the partnership agreement is terminated before the lapse of one and a half
years period under any of the causes mentioned in paragraph (2), then Yang
Chiao Seng shall have the right to remove and take away all improvements that
the partnership may place in the premises.
Upon
agreement by Mrs. Yulo & Yang, they executed a partnership agreement
establishing “Yang & Company, Ltd”. The capital is fixed at P100,000, P80,000 shouldered
by Yang Chiao Seng and P20,000, by Mrs. Yulo. All gains and profits are
distributed among the partners in the same proportion as their capital
contribution.
In June,
1946, extended their partnership for another 3 years & by the end of the
terms, the showhouse building shall belong exclusively to Mrs. Yulo.
Problem
arised when the owner of the land canceled the contract of lease of Mrs Yulo. Due
to such notice, Mrs Yulo and her husband
The land on which the
theatre was constructed was leased by plaintiff Mrs, Yulo from Emilia Carrion
Santa Marina and Maria Carrion Santa Marina. In the con- tract of lease it was
stipulated that the lease shall continue for an indefinite period of time, but
that after one year the lease may be cancelled by either party by written
notice to the other party at least 90 days before the date of cancellation. The
last contract was executed between the owners and Mrs. Yulo on April 5, 1948.
But on April 12, 1949, the the attorney for the owners notified Mrs. Yulo of
the owner's desire to cancel the contract of lease on July 31, 1949. In view of
the above notice, Mrs. Yulo and her husband brought a civil action in the Court
of First Instance of Manila on July 3, 1949 to declare the lease of the
premises one for an indefinite period. On August 17, 1949, the owners on their
part brought an action in the Municipal Court of Manila against Mrs. Yulo and
her husband and Yang Chiao Seng to eject them from the premises. On February 9,
1950, the Municipal Court of Manila rendered judgment ordering the ejectment of
Mrs. Yulo and Mr. Yang. The judgment was appealed. In the Court of First
Instance, the two cases were afterwards heard jointly, and judgment was
rendered dismissing the complaint of Mrs. Yulo and her husband, and declaring
the contract of lease of the premises terminated as of July 31, 1949, and
fixing the reasonable monthly rentals of said premises at P100. Both parties
appealed from said decision and the Court of Appeals, on April 30, 1955,
affirmed the judgment.
Issue WON the agreement was that of a contract of
lease or partnership
Held: The agreement was a sublease not a partnership.
The following are the requisites of partnership:
(1)
two or more
persons who bind themselves to contribute money, property or industry to a common
fund;
(2)
the intention on the
part of the partners to divide the profits among themselves (Article 1761, CC)
Plaintiff did not furnish the supposed P20,000
capitalnor did she furnish any help or intervention in the management of the
theatre. Neither has she demanded from defendant any accounting of the expenses
and earnings of the business. She was absolutely silent with respect to any of
the acts thata partner should have done; all she did was to receive her share
of P3,000 a month which cannot be interpreted in any manner than a payment for
the use of premises which she had leased from the owners
Ruling: Dismissed.
Same Same:
1.
CONTRACTS; LEASE; CIRCUMSTANCES
THAT NEGATE PARTNERSHIP.—Where one of
the parties to a contract does not contribute the capital he is supposed to
contribute to a common fund; does not furnish any help or intervention in the
management of the business subject of the contract; does not demand from the
other party an accounting of the expenses and earnings of the business; and is
absolutely silent with respect to any of the acts that a partner should have
done, but, on the other hand, receives a fixed monthly sum from the other
party, there can be no other conclusion than that the contract between the
parties is one of lease and not of partnership.
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