WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

1. Obligation to contribute equally to the capital of the

partnership unless there is a stipulation to the
contrary(Art. 1790)

Reasons: Because the partners are deemed to have equal rights

and obligations.
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?
2. Obligations with respect to contribution of property
 a. To deliver to the partnership at the time it was constituted or
on the date stipulated the property he has promised contribute.
 b. To take care of the property before its delivery to the
partnership with the diligence of a good father of a family as a
rule. (Art. 1163)
 c. To be liable for damages in case of default.
 d. To answer for eviction in case the partnership is deprived of
the specific or determinate thing he has contributed to the
partnership.
 e. To be liable for the fruits of the thing from the time they
should have been delivered without the need of any demand.
(Art. 1786)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

3. Obligations with respect to contribution of money

 a. To deliver to the partnership at the time it was
constituted or on the date stipulated the money he has
promised to contribute.
 b. To pay interest on the amount he had promised to
contribute from the time he should have complied with his
obligation.
 c. To pay damages suffered by the partnership by reason of
the default. (Art. 1788)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?
 Illustration: A, B and C formed a partnership with the following contributions to be delivered on
October 10, 2020:
 A to contribute P100,000
 B to contribute a specific land
 C to contribute a specific building
1. Suppose A gave only his P100,000 on October 10, 2021, what is his additional obligation?

Answer: To pay the agreed or legal interest and damages from the time of delay.

2. Suppose B delivered the land on October 10, 2020 but the partnership was evicted by the real
owner “O”, what is the obligation of B?

Answer: B will answer for his warranty against eviction, in the same case as the vendor is liable to the
vendee on contract of sale.

3. Suppose C failed to deliver the building on time because it is possessed by “L” as a lessee, what is
his obligation to the partnership?

 Answer: To deliver the building and also the fruits (rentals of L) from the time the building should
have been delivered. The liability arises without the need of demand. (Art. 1786 and 1788)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

4. Obligations with respect to amount appropriated.

 a. To reimburse to the partnership the amount that he has
taken from the partnership coffers.
 b. To pay interest on the amount he had converted for his
own use from the time of conversion.
 c. To pay the damages suffered by the partnership by reason
of the conversion. (Art. 1788)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

5. Obligation to contribute additional capital.

 a. To contribute additional share to the capital in case
of an imminent loss of the business of the partnership,
except:
1. If he is an industrial partner, or
2. If there is an agreement to the contrary.

 b. To sell his interest to the other partners if he refuses

to contribute such additional capital. (Art. 1791)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

6. Obligation of a partner who has received his share of the

partnership credit:
 To bring to the partnership capital his share of a partnership
credit which he has received in whole or in part even if he
may have given his receipt only if the following requisites
are present:
a. The other partners have not collected their shares,
and
b. The debtor becomes insolvent after the partner has
received the payment. (Art. 1793)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

7. Obligation to pay damages to the partnership

 1. To pay to the partnership for damages suffered by it
through his fault.
 2. He cannot compensate them with the profits and benefits
which he may have earned for the partnership by his
industry.
 3. However, the court may equitably lessen this
responsibility if through the partner’s extraordinary efforts
in other activities of the partnership, unusual profits have
been realized. (Art. 1794)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?
8. Obligations of the partners in case of imminent loss
 To bear the risk of specific and determinate things owned by him which
are not fungible, contributed to the partnership sop that only their use
and fruits may be for the common benefit.
 If there is no agreement to the contrary, any partner who refuses to
contribute an additional share to the capital, except an industrial partner, to
save the venture, shall be obliged to sell his interest to the other partners.
Who bears the risk of loss on things contributed by partner?
 1. The partnership bears the loss when the things contributed are-
a. To be sold
b. Consumable or cannot be kept without deteriorating
c. Under appraisal in the inventory.
 2. The partner shall bear the loss-
a. When the things contributed are non-consumable and only their use
and fruits are for the benefit of the partnership.
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

9. Obligation to render information.

To render on demand true and full information of all
things affecting the partnership to
a. Any partner, or
b. Legal representative of any deceased partner, or
c. Legal representative of any partner under legal
disability. (Art. 1806)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

10. Obligation to account

Every partner must account to the partnership for
any benefit, and hold as trustee for it any profits
derived by him without the consent of the other
partners from any transaction connected with the
formation, conduct or liquidation of the partnership
or from any use by him of its property. (Art. 1807)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?
11. Liability of a newly admitted partner –
a. Obligations existing at the time of his admission.
He is liable but only to the extent of is contribution except
if there is an agreement that his liability shall extend to his
separate property.

b. Obligations incurred after his admission.

c. He shall be liable like the other partners pro rata with

their separate property after the partnership assets have been
exhausted. (Art. 1826)
 WHAT ARE THE OBLIGATIONS OF THE PARTNERS?

Illustration:
A and B are partners. C is admitted as a new partner. Will C be
liable for obligations contracted by the partnership prior to his
admission to the partnership?

Answer: Yes, but his liability shall be limited only to his share in
the partnership interest, not to his own individual properties.
WHAT ARE THE OBLIGATIONS OF THE PARTNERS TO
THE PARTNERSHIP?

1. Partnership shall be responsible to every partner for the

amounts he may have disbursed on behalf of the
partnership and for the corresponding interest, from the
time the expenses are made.

2. Partnership shall also answer to each partner for the

obligations he may have contracted in good faith in the
interest of the partnership business, and

3. To answer for risks in consequence of its management.

(Art. 1796)
WHAT ARE THE OBLIGATIONS OF THE PARTNERSHIP
FOR THE WRONGFUL ACTS OF THE PARTNER?

1. The partnership shall be solidarily liable with all the partners in the
following cases:

 1. For loss or injury caused to a third person or any penalty is

incurred by reason of the wrongful act or omission of any partner
acting in the ordinary course of the business of the partnership or
with the authority of his co-partners. (Art. 1822)
 2. Where one partner acting within the scope of his apparent
authority received money or property of a third person and
misapplies it.
 3. Where the partnership in the course of the business receives
money or property of a third person and such money or property is
misapplied while it is in the custody of the partnership. (Art. 1823).
 WHAT ARE THE LIABILITIES OF PARTNERSHIP TO
THIRD PERSONS FOR ACTS OF PARTNERS?
1. When partnership is bound:
 a. If the partner is authorized to act for the partnership, the
partnership is bound whether or not the act is for
apparently carrying on in the usual way the business of the
partnership.

 b. If the partner is not authorized to act for the partnership,

the partnership is bound if:
1. The act is for apparently carrying on in the usual way
the business of the partnership; and
2. The third person has no knowledge of the partner’s
lack of authority. (Art. 1818)
 WHAT ARE THE LIABILITIES OF PARTNERSHIP TO
THIRD PERSONS FOR ACTS OF PARTNERS?
Illustration:
Riza, Imelda, Chanda, and Editha are partners in RICE Company whose
business is trading in grains such as rice, corn, etc. The partners appointed
Riza to manage the partnership. During the year, the partners also
authorized Chanda to buy a van for the partnership.
 a. Any sale or purchase of grains by Riza is binding against RICE Company
because she is the duly appointed manager.
 b. The purchase of van by Chanda will also bind RICE Company although it
is not connected with the trading of grain products because she is
authorized to perform the act.
 c. If Editha who is not authorized at all to act for RICE Company sells
grains to Theresa, a customer, RICE Company will be bound by the sale so
long as Theresa is not aware of Editha’s lack of authority since the sale
made by Editha is apparently for carrying on in the usual way the business
of the partnership.
 WHAT ARE THE LIABILITIES OF PARTNERSHIP TO
THIRD PERSONS FOR ACTS OF PARTNERS?

2. When partnership is not bound:

 a. When, although the act is for apparently carrying on in the
usual way the business of the partnership, the partner is not
authorized to act for the partnership and the third person
has knowledge of the partner’s lack of authority. (Art. 1818)

 b. When the partner is not authorized to act for the

partnership and the act is not for apparently carrying on in
the usual was the business of the partnership.
 WHAT ARE THE LIABILITIES OF PARTNERSHIP TO
THIRD PERSONS FOR ACTS OF PARTNERS?

In the foregoing example, RICE Company will not be bound in

the following cases:
 a. If Theresa was aware that Editha had no authority to sell the
products of the partnership even if such act is apparently the
carrying on in the usual way the business of the partnership.

 b. If it is Imelda who purchased a van and not Chanda, because

Imelda is not authorized for that purpose. It is immaterial
whether the seller of the van was aware or not of Imelda’s lack
of authority because the purchase of the van is not for
apparently carrying on in the usual way the business of the
partnership.