NEW ERA UNIVERSITY

COLLEGE OF LAW

MIDTERM EXAMINATIONS IN PARTNERSHIP, AGENCY AND TRUSTS

December 29, 7 to 9 p.m.
Assistant Ombudsman LEILANIE BERNADETTE C. CABRAS

INSTRUCTIONS. Read the questions carefully. Answer sequentially in a concise and grammatically
correct manner in MS Word format. Save your file as PDF using this format as file name:
yoursurnameAGENCYMIDTERMSNEU. Send to my telegram account not later than 9:15 p.m.

1. Best friends Eric and Charles Xavier were partners in a private, exclusive school for gifted youngsters
established in 1980. In February, 2010, Charles Xavier died in an accident, leaving Eric alone to run the
school. Jean, Charles Xavier’s adopted daughter and sole heir, filed a suit against Eric in 2019,
demanding Xavier’s share in the school’s profits from 2010 onwards.
Rule on Jean’s complaint. (20 pts.)
1. In 2005, townmates Clark, Lois and Lana formed a limited partnership with Lana as the limited partner.
On August, 2008, becoming insanely jealous with the budding romance between her co-partners, Lana
decided to opt out of the partnership and accordingly assigned her interests to Lex. Busy with their
then upcoming nuptials, Clark and Lois failed to immediately amend the certificate to reflect such
assignment. It was only in January, 2010 that they were able to file the amendment with the
Securities and Exchange Commission. On March 2, 2010, Gen. Zod (ret.), a creditor and business
associate sued Clark, Lois, Lana and Lex for the following receivables:
a) unpaid loan in the amount of P5,000,000.00 contracted sometime in 2006
b) unpaid loan in the amount of 500,000.00 contracted on February, 2008
c) services rendered by Gen. Zod’s security firm from January 1,2009 to December 31, 2009.
In her Answer, Lana contended that the complaint should be dismissed as against her since her act of
assigning her interests in Lex’s favor completely absolved her of liability.
Is Lana’s contention correct. Explain. (20 pts.)
2. Lawyers Gil, Nick, Warrick, Sara, and Catherine were partners in a law firm specializing in criminal cases
established in 2001. In December, 2008, Atty. Sara left the firm and migrated to the US. Despite this
development, Atty. Nick, as the managing partner, proceeded to undertake the following transactions
on behalf of the firm:
a) renewal of the lease contract for the firm’s rented office space for 2009
b) collection of retainer fees from CSI Corp., for the period 2007-2009
c) Payment of the salaries and bonuses of their 3 paralegals for the 4th quarter of 2008
d) Accepting the case of Ms. Melinda Lee
e) Filing of case against CBS, Inc., for collection of success fee in a breach of contract case the firm
handled in 2007
 Discuss the propriety of Atty. Nick’s acts. (20 pts.)

3. Bosom buddies Bubbles and Blossom and another friend, Buttercup, agreed to pool together their
resources for the purpose of constructing a mid-rise condominium. Pursuant to the agreement,
Bubbles and Blossom executed a Deed of Absolute Sale on their 2,000 sq. m. lot in Taytay, in favor of
Buttercup, who then had it registered in her name so as to get a 20M loan from Banco Rural de Rizal to
be used in the construction of the condominium. As Bubbles and Blossom had full-time jobs, Buttercup
was the one who facilitated the loan and documentation relative to the project. They agreed to share
the earnings from the eventual sale of the condominium units. The venture did not push through,
however, and the lot was foreclosed by the bank due to non-payment of the loan. Thus, Bubbles and
Blossom filed separate complaints for estafa against Buttercup, as well as for nullification of the
foreclosure proceedings. Buttercup interposed the defense that what they have established is a
partnership, and therefore, she cannot be made liable. Bubbles and blossom, meanwhile, aver that
there can be no partnership, as the venture was not registered nor the lot inventoried as required under
the law. Rule on the parties’ conflicting contentions. (20 pts.)

4. Kimmy and Dora are the twin daughters of Fil-Korean businessman Rin Tin Tin. In early 2009, Dora died
in a vehicular accident. Mickey, the adopted daughter of Dora, filed a suit against Kimmy, for
accounting of sharing in the partnership profits from the Quieme Boutique, a chain of stores selling
luxury brands. Mickey alleged that Kimmy and Dora established Quieme in 1990, in order to step out
from their father’s shadow. It is further alleged that Dora acts as “buyer” of the goods and manages the
boutique’s flagship store in Makati which is situated in a building which was earlier donated to the
sisters by their father Rin Tin Tin. Moreover, until the end of 2000, Dora used to receive P50,000.00
monthly and another P250,000.00 per quarter from Kimmy, presumably as her share in the profits. To
these allegations, Kimmy replied that she is the sole proprietor of Quieme Boutique. According to her,
Dora is a mere employee and the monthly pay-out is not her share in the business’ profits but her salary
as “buyer” and store manager. As to the P250,000.00, Kimmy contends that the same does not amount
to Dora’s share in the partnership profits, as she was merely paying her loan from Dora. She added that
if Dora was indeed her partner, she should have asked for accounting as early as 2000 or at least until
before she died. After trial, the court ruled in favor of Mickey and directed Kimmy to render accounting
and give Dora’s share in the partnership profits. Kimmy thus appealed. Decide the appeal based on
the rules governing the existence of partnership. (20 pts)