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Bastida vs Menzi GR L-35840 March 31, 1933 Facts: Bastida offered to assign to Menzi & Co.

his contract with Phil Sugar Centrals Agencyand to supervise the mixing of the fertilizer and to obtain other orders for 50 % of the net profit that Menzi & Co., Inc., might derive therefrom. J. M. Menzi (gen. manager of Menzi & Co.) accepted the offer. The agreement between the parties was verbal and was confirmed by the letter of Menzi to the plaintiff on January 10, 1922. Pursuant to the verbal agreement, the defendant corporation on April 27, 1922 enteredinto a written contract with the plaintiff, marked Exhibit A, which is the basis of the present action. Still, the fertilizer business as carried on in the same manner as it was prior to the written contract, but the net profit that the plaintiff herein shall get wouldonly be 35%. The intervention of the plaintiff was limited to supervising the mixing of the fertilizers in the bodegas of Menzi. Prior to the expiration of the contract (April 27, 1927), the manager of Menzi notified the plaintiff that the contract for his services would not be renewed. Subsequently, when thecontract expired, Menzi proceeded to liquidate the fertilizer business in question. The plaintiff refused to agree to this. It argued, among others, that the written contract enteredinto by the parties is a contract of general regular commercial partnership, wherein Menziwas the capitalist and the plaintiff the industrial partner. Issue: Whether or not the relationship between the petitioner and Menzi is that of partners? Ruling: The relationship established between the parties was not that of partners, but that of employer and employee, whereby the plaintiff was to receive 35% of the net profits of thefertilizer business of Menzi in compensation for his services for supervising the mixingof the fertilizers. Neither the provisions of the contract nor the conduct of the parties p r i o r o r s u b s e q u e n t t o i t s e x e c u t i o n j u s t i f i e d t h e f i n d i n g t h a t i t w a s a c o n t r a c t o f c o - partnership. The written contract was, in fact, a continuation of the verbal agreement between the parties, whereby the plaintiff worked for the defendant corporation for one-half of the net profits derived by the corporation form certain fertilizer contracts. According to Art. 116 of the Code of Commerce, articles of association by which two or more persons obligate themselves to place in a common fund any property, industry, or any of these things, in order to obtain profit, shall be

commercial, no matter what it classmay be, provided it has been established in accordance with the provisions of the Code.However in this case, there was no common fund. The business belonged to Menzi & Co.The plaintiff was working for Menzi, and instead of receiving a fixed salary, he was to receive 35% of the net profits as compensation for his services. The phrase in the writtencontract en sociedad con, which is used as a basis of the plaintiff to prove partnershipin this case, merely means en reunion con or in association with. It is also important to note that although Menzi agreed to furnish the necessary financialaid for the fertilizer business, it did not obligate its elf to contribute any fixed sum ascapital or to defray at its own expense the cost of securing the necessary

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