Beruflich Dokumente
Kultur Dokumente
172690
March 3, 2010
On the merits of the case, we find that the instant Petition is bereft of
merit.
A partnership exists when two or more persons agree to place their
money, effects, labor, and skill in lawful commerce or business, with
the understanding that there shall be a proportionate sharing of the
profits and losses among them. A contract of partnership is defined by
the Civil Code as one where two or more persons bind themselves to
contribute money, property, or industry to a common fund, with the
intention of dividing the profits among themselves.12
Undoubtedly, the best evidence would have been the contract of
partnership or the articles of partnership. Unfortunately, there is none
in this case, because the alleged partnership was never formally
organized. Nonetheless, we are asked to determine who between Jose
and Elfledo was the "partner" in the trucking business.
A careful review of the records persuades us to affirm the CA decision.
The evidence presented by petitioners falls short of the quantum of
proof required to establish that: (1) Jose was the partner and not
Elfledo; and (2) all the properties acquired by Elfledo and respondent
form part of the estate of Jose, having been derived from the alleged
partnership.
Petitioners heavily rely on Jimmy's testimony. But that testimony is just
one piece of evidence against respondent. It must be considered and
weighed along with petitioners' other evidence vis--vis respondent's
contrary evidence. In civil cases, the party having the burden of proof
must establish his case by a preponderance of evidence.
"Preponderance of evidence" is the weight, credit, and value of the
aggregate evidence on either side and is usually considered
synonymous with the term "greater weight of the evidence" or "greater
weight of the credible evidence." "Preponderance of evidence" is a
phrase that, in the last analysis, means probability of the truth. It is
evidence that is more convincing to the court as worthy of belief than
that which is offered in opposition thereto.13 Rule 133, Section 1 of the
Rules of Court provides the guidelines in determining preponderance
of evidence, thus:
SECTION I. Preponderance of evidence, how determined. In civil
cases, the party having burden of proof must establish his case by a
preponderance of evidence. In determining where the preponderance
or superior weight of evidence on the issues involved lies, the court
may consider all the facts and circumstances of the case, the
witnesses' manner of testifying, their intelligence, their means and
opportunity of knowing the facts to which they are testifying, the nature
of the facts to which they testify, the probability or improbability of their
testimony, their interest or want of interest, and also their personal
credibility so far as the same may legitimately appear upon the trial.
The court may also consider the number of witnesses, though the
preponderance is not necessarily with the greater number.
At this juncture, our ruling in Heirs of Tan Eng Kee v. Court of
Appeals14 is enlightening. Therein, we cited Article 1769 of the Civil
Code, which provides:
Art. 1769. In determining whether a partnership exists, these rules
shall apply:
(1) Except as provided by Article 1825, persons who are not
partners as to each other are not partners as to third
persons;
the partnership and its business, the fact that its properties were
placed in his name, and that he was not paid salary or other
compensation by the partners, are indicative of the fact that Elfledo
was a partner and a controlling one at that. It is apparent that the other
partners only contributed in the initial capital but had no say thereafter
on how the business was ran. Evidently it was through Elfredos efforts
and hard work that the partnership was able to acquire more trucks
and otherwise prosper. Even the appellant participated in the affairs of
the partnership by acting as the bookkeeper sans salary.1avvphi1
It is notable too that Jose Lim died when the partnership was barely a
year old, and the partnership and its business not only continued but
also flourished. If it were true that it was Jose Lim and not Elfledo who
was the partner, then upon his death the partnership should have
been dissolved and its assets liquidated. On the contrary, these were
not done but instead its operation continued under the helm of Elfledo
and without any participation from the heirs of Jose Lim.
Whatever properties appellant and her husband had acquired, this was
through their own concerted efforts and hard work. Elfledo did not limit
himself to the business of their partnership but engaged in other lines
of businesses as well.
In sum, we find no cogent reason to disturb the findings and the ruling
of the CA as they are amply supported by the law and by the evidence
on record.
WHEREFORE, the instant Petition is DENIED. The assailed Court of
Appeals Decision dated June 29, 2005 is AFFIRMED. Costs against
petitioners.
SO ORDERED.
Digest:
In 1980, the heirs of Jose Lim alleged that Jose Lim entered into a
partnership agreement with Jimmy Yu and Norberto Uy. The three
contributed P50,000.00 each and used the funds to purchase a truck to
start their trucking business. A year later however, Jose Lim died. The
eldest son of Jose Lim, Elfledo Lim, took over the trucking business
and under his management, the trucking business prospered. Elfledo
was able to but real properties in his name. From one truck, he
increased it to 9 trucks, all trucks were in his name however. He also
acquired other motor vehicles in his name.
The above testimonies prove that Elfledo was not just a hired help but
one of the partners in the trucking business, active and visible in the
running of its affairs from day one until this ceased operations upon his
demise. The extent of his control, administration and management of
2.) Elfledo ran the affairs of the partnership, wielding absolute control,
attack. Elfledos wife, Juliet Lim, took over the properties but she
intimated to Jimmy and the heirs of Norberto that she could not go on
3.) all of the properties, particularly the nine trucks of the partnership,
were registered in the name of Elfledo;
Now the other heirs of Jose Lim, represented by Elenito Lim, required
Juliet to do an accounting of all income, profits, and properties from the
estate of Elfledo Lim as they claimed that they are co-owners thereof.
Juliet refused hence they sued her.
The heirs of Jose Lim argued that Elfledo Lim acquired his properties
from the partnership that Jose Lim formed with Norberto and Jimmy. In
court, Jimmy Yu testified that Jose Lim was the partner and not Elfledo
Lim. The heirs testified that Elfledo was merely the driver of Jose Lim.
ISSUE: Who is the partner between Jose Lim and Elfledo Lim?
4.) Jimmy testified that Elfledo did not receive wages or salaries from
the partnership, indicating that what he actually received were shares
of the profits of the business; and
5.) none of the heirs of Jose, the alleged partner, demanded periodic
accounting from Elfledo during his lifetime. As repeatedly stressed in
the case of Heirs of Tan Eng Kee, a demand for periodic accounting is
evidence of a partnership.
of Elfledo and Juliet formed part of the estate of Jose, having been
Jimmy Yus testimony in court that Jose Lim was the partner. If Jose
Lim was the partner, then the partnership would have been dissolved
upon his death (in fact, though the SC did not say so, I believe it
should have been dissolved upon Norbertos death in 1993). A
partnership is dissolved upon the death of the partner. Further, no
evidence was presented as to the articles of partnership or contract of
partnership between Jose, Norberto and Jimmy. Unfortunately, there is
none in this case, because the alleged partnership was never formally
organized.
Elfledo was not just a hired help but one of the partners in the trucking
business, active and visible in the running of its affairs from day one
until this ceased operations upon his demise. The extent of his control,
administration and management of the partnership and its business,
the fact that its properties were placed in his name, and that he was
not paid salary or other compensation by the partners, are indicative of
the fact that Elfledo was a partner and a controlling one at that. It is
apparent that the other partners only contributed in the initial capital
But at any rate, the Supreme Court noted that based on the functions
but had no say thereafter on how the business was ran. Evidently it
was through Elfredos efforts and hard work that the partnership was
able to acquire more trucks and otherwise prosper. Even the appellant
The following circumstances tend to prove that Elfledo was himself the
partner of Jimmy and Norberto:
xxxx
12. The compensation of the MANAGER shall be fifty per
cent (50%) of the net profit of the Sto. Nino PROJECT
before income tax. It is understood that the MANAGERS
shall pay income tax on their compensation, while the
PRINCIPAL shall pay income tax on the net profit of the Sto.
Nino PROJECT after deduction therefrom of the
MANAGERS compensation.
xxxx
16. The PRINCIPAL has current pecuniary obligation in favor
of the MANAGERS and, in the future, may incur other
obligations in favor of the MANAGERS. This Power of
Attorney has been executed as security for the payment and
satisfaction of all such obligations of the PRINCIPAL in favor
of the MANAGERS and as a means to fulfill the same.
Therefore, this Agency shall be irrevocable while any
obligation of the PRINCIPAL in favor of the MANAGERS is
outstanding, inclusive of the MANAGERS account. After all
obligations of the PRINCIPAL in favor of the MANAGERS
have been paid and satisfied in full, this Agency shall be
revocable by the PRINCIPAL upon 36-month notice to the
MANAGERS.
17. Notwithstanding any agreement or understanding
between the PRINCIPAL and the MANAGERS to the
contrary, the MANAGERS may withdraw from this Agency by
giving 6-month notice to the PRINCIPAL. The MANAGERS
shall not in any manner be held liable to the PRINCIPAL by
reason alone of such withdrawal. Paragraph 5(d) hereof
shall be operative in case of the MANAGERS withdrawal.
x x x x5
In the course of managing and operating the project, Philex Mining
made advances of cash and property in accordance with paragraph 5
of the agreement. However, the mine suffered continuing losses over
the years which resulted to petitioners withdrawal as manager of the
mine on January 28, 1982 and in the eventual cessation of mine
operations on February 20, 1982.6
On August 5, 1992, the BIR sent a letter to Philex asking it to settle its
excise taxliabilities amounting to P123,821,982.52. Philex protested
the demand for payment of the tax liabilities stating that it has pending
claims for VAT input credit/refund for thetaxes it paid for the years 1989
to 1991 in the amount of P119,977,037.02 plus interest.Therefore,
these claims for tax credit/refund should be applied against the tax
liabilities.In reply, the BIR held that since these pending claims have
not yet been established or determined with certainty, it follows that no
legal compensation can take place. Hence,the BIR reiterated its
demand that Philex settle the amount plus interest within 30 daysfrom
the receipt of the letter.
Whether or not the petitioner is correct in its contention that tax liability
and VATinput credit/refund can be subjected to legal compensation.
HELD:
The Supreme Court has already made the pronouncement that taxes
cannot be subjectto compensation for the simple reason that the
government and the taxpayer are notcreditors and debtors of each
other. There is a material distinction between a tax anddebt. Debts are
due to the Government in its corporate capacity, while taxes are due
tothe Government in its sovereign capacity.
Philexs
claim is an outright disregard of the basic principle in tax law that taxes
are thelifeblood of the government and so should be collected without
unnecessary hindrance.
Evidently, to countenance Philexs whimsical reason would render
ineffective our tax
collection system.Philex is not allowed to refuse the payment of its tax
liabilities on the ground that it has apending tax claim for refund or
credit against the government which has not yet beengranted. It must
be noted that a distinguishing feature of a tax is that it is
compulsoryrather than a matter of bargain. Hence, a tax does not
depend upon the consent of thetaxpayer.If any payer can defer the
payment of taxes by raising the defense that it stillhas a pending claim
for refund or credit, this would adversely affect the governmentrevenue
system. A taxpayer cannot refuse to pay his taxes when they fall due
simplybecause he has a claim against the government or that the
collection of the tax iscontingent on the result of the lawsuit it filed
against the government. Moreover, Philex'stheory that would
automatically apply its VAT input credit/refund against its tax
liabilitiescan easily give rise to confusion and abuse, depriving the
government of authority over the manner by which taxpayers credit
and offset their tax liabilities.
Philex raised the issue to the Court of Tax Appeals and in the course
of theproceedings, the BIR issued a Tax Credit Certificate SN 001795
in the amount of P13,144,313.88 which, applied to the total tax
liabilities of Philex of P123,821,982.52;effectively lowered the latters
tax obligation of P110,677,688.52.
Despite the reduction of its tax liabilities, the CTA still ordered Philex to
pay theremaining balance of P110,677,688.52 plus interest, elucidating
its reason that taxescannot be subject to set-off on compensation
since claim for taxes is not a debt or contract.Philex appealed the case
before the Court of Appeals. Nonetheless, the Court of Appeals
affirmed the Court of Tax Appeals observation.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 176271
On December 2 and 20, 1999, MENDOZA and CRUZ signed two Job
Orders/Agreements5 for the lease of the latters heavy equipment
(dump trucks for hauling purposes) to EMPCT.
On April 27, 2000, PAULE revoked6 the SPA he previously issued in
favor of MENDOZA; consequently, NIA refused to make payment to
MENDOZA on her billings. CRUZ, therefore, could not be paid for the
rent of the equipment. Upon advice of MENDOZA, CRUZ addressed
his demands for payment of lease rentals directly to NIA but the latter
refused to acknowledge the same and informed CRUZ that it would be
remitting payment only to EMPCT as the winning contractor for the
project.
In a letter dated April 5, 2000, CRUZ demanded from MENDOZA
and/or EMPCT payment of the outstanding rentals which amounted to
P726,000.00 as of March 31, 2000.
On June 30, 2000, CRUZ filed Civil Case No. 18-SD (2000) with
Branch 37 of the Regional Trial Court of Nueva Ecija, for collection of
sum of money with damages and a prayer for the issuance of a writ of
preliminary injunction against PAULE, COLOMA and the NIA. PAULE
in turn filed a third-party complaint against MENDOZA, who filed her
answer thereto, with a cross-claim against PAULE.
MENDOZA alleged in her cross-claim that because of PAULEs
"whimsical revocation" of the SPA, she was barred from collecting
payments from NIA, thus resulting in her inability to fund her checks
which she had issued to suppliers of materials, equipment and labor
for the project. She claimed that estafa and B.P. Blg. 22 cases were
filed against her; that she could no longer finance her childrens
education; that she was evicted from her home; that her vehicle was
foreclosed upon; and that her reputation was destroyed, thus entitling
her to actual and moral damages in the respective amounts of P3
million and P1 million.
Meanwhile, on August 23, 2000, PAULE again constituted MENDOZA
as his attorney-in-fact
1. To represent me (PAULE), in my capacity as General
Manager of the E.M. PAULE CONSTRUCTION AND
TRADING, in all meetings, conferences and transactions
exclusively for the construction of the projects known as
Package A-10 of Schedule A and Package No. B-11
Schedule B, which are 38.61% and 63.18% finished as of
June 21, 2000, per attached Accomplishment Reports x x x;
2. To implement, execute, administer and supervise the said
projects in whatever stage they are in as of to date, to collect
checks and other payments due on said projects and act as
the Project Manager for E.M. PAULE CONSTRUCTION AND
TRADING;
3. To do and perform such acts and things that may be
necessary and required to make the herein power and
authority effective.7
At the pre-trial conference, the other parties were declared as in
default and CRUZ was allowed to present his evidence ex parte.
Among the witnesses he presented was MENDOZA, who was
impleaded as defendant in PAULEs third-party complaint.
10
As for CRUZ, the Court of Appeals held that he knew the limits of
MENDOZAs authority under the SPAs yet he still transacted with her.
Citing Manila Memorial Park Cemetery, Inc. v. Linsangan,9 the
appellate court declared that the principal (PAULE) may not be bound
by the acts of the agent (MENDOZA) where the third person (CRUZ)
transacting with the agent knew that the latter was acting beyond the
scope of her power or authority under the agency.
11
12
13
Digest:
2.
be held civilly liable to his partner for revoking, in bad faith, the Special
Power of Attorney given to the latter and for abandoning the
14