Heirs of Jose Lim, represented by Elenito Lim vs Juliet Villa Lim

Facts:
Petitioners, Crecensia Palad, Elenito, Evelia, Imelda, Edelyna and Edison Lim, filed a
Complaint for Partition, Accounting and Damages against respondent Juliet Villa Lim, widow of
Elfledo Lim, the eldest son of Jose and Crecensia. Jose Lim formed a partnership together with
Jimmy Yu and Norberto Uy to engage in the trucking business with an initial contribution of
P50,000 each. Jose managed the operations of the business until his death and the petitioners
alleged that after Jose’s demise, his heirs and partners agreed to continue the business under
Elfledo’s management in which the shares in the partnership, profit and income that formed part
of Jose’s estate were held in trust by Elfledo with the authority of the petitioners for Elfledo to
use and purchase or acquire properties further alleging that Elfledo is not a partner and such
properties were registered in his name and that of respondent. On May 18, 1995 Elfledo died,
petitioners claims that respondent took over the administration of the properties, which belonged
to the estate of Jose, without their consent and approval, requiring respondent to submit an
accounting of all income, profits and rentals received from the estate of Elfledo and surrender
administration thereof. Respondent claimed that Elfledo was a partner himself and that Jose gave
Elfledo P50,000.00 as the latter’s capital, and that other than the trucking business Elfledo and
respondent engaged in other business ventures which enabled them to buy real properties and to
put up their own car assembly and repair business. Respondent maintained that all properties
involved were purchased and acquired through her and her husband’s joint efforts and hard work
without participation or contribution from petitioners or from Jose.
Issue: Whether or not a partnership exists among Elfedo Lim, Norberto Uy and Jimmy Yu.
Ruling:
The Supreme Court ruled that a partnership exists among Elfledo Lim, Norberto Uy and
Jimmy Yu. 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
proportionate sharing of the profits and losses among them. The following circumstances tend to
prove that Elfedo was a partner: (1) Crecensia testified that Jose gave Elfledo P50,000.00 as
share in the partnership; (2) Elfledo ran affairs of the partnership, wielding absolute control,
power and authority, without intervention or opposition by the petitioners; (3) all the properties
were registered in his name; and (4) Jimmy testified that Elfledo did not receive salaries
indicating that what he received were shared of the profits of the business. Furthermore,
petitioners failed to adduce any evidence to show that the real and personal properties acquired
and registered in the names of Elfledo and respondent formed part of Jose’s estate.