Tocao and Belo vs CA and Anay

FACTS:
William Belo introduced Nenita Anay to his girlfriend, Marjorie Tocao. The three agreed to
form a joint venture for the sale of cooking wares. Belo was to contribute P2.5 million; Tocao
also contributed some cash and she shall also act as president and general manager; and
Anay shall be in charge of marketing. Belo and Tocao specifically asked Anay because of
her experience and connections as a marketer. They agreed further that Anay shall receive
the following:
1.

10% share of annual net profits

2.

6% overriding commission for weekly sales

3.

30% of sales Anay will make herself

4.

2% share for her demo services

They operated under the name Geminesse Enterprise, this name was however registered
as a sole proprietorship with the Bureau of Domestic Trade under Tocao. The joint venture
agreement was not reduced to writing because Anay trusted Belos assurances.
The venture succeeded under Anays marketing prowess.
But then the relationship between Anay and Tocao soured. One day, Tocao advised one of
the branch managers that Anay was no longer a part of the company. Anay then demanded
that the company be audited and her shares be given to her.
ISSUE: Whether or not there is a partnership.
HELD: Yes, even though it was not reduced to writing, for a partnership can be instituted in
any form. The fact that it was registered as a sole proprietorship is of no moment for such
registration was only for the companys trade name.
Anay was not even an employee because when they ventured into the agreement, they
explicitly agreed to profit sharing this is even though Anay was receiving commissions
because this is only incidental to her efforts as a head marketer.
The Supreme Court also noted that a partner who is excluded wrongfully from a partnership
is an innocent partner. Hence, the guilty partner must give him his due upon the dissolution
of the partnership as well as damages or share in the profits realized from the appropriation
of the partnership business and goodwill. An innocent partner thus possesses pecuniary

interest in every existing contract that was incomplete and in the trade name of the copartnership and assets at the time he was wrongfully expelled.
An unjustified dissolution by a partner can subject him to action for damages because by
the mutual agency that arises in a partnership, the doctrine of delectus personaeallows the
partners to have the power, although not necessarily the right to dissolve the partnership.
Tocaos unilateral exclusion of Anay from the partnership is shown by her memo to the
Cubao office plainly stating that Anay was, as of October 9, 1987, no longer the vicepresident for sales of Geminesse Enterprise. By that memo, petitioner Tocao effected her
own withdrawal from the partnership and considered herself as having ceased to be
associated with the partnership in the carrying on of the business. Nevertheless, the
partnership was not terminated thereby; it continues until the winding up of the business.

HEIRS OF TAN ENG KEE vs.CA 341 SCRA 740, G.R. No. 126881, October 3, 2000

FACTS:
After the second World War, Tan EngKee and Tan Eng Lay, pooling their resources and industry together,
entered into a partnership engaged in the business of selling lumber and hardware and construction
supplies. They named their enterprise "Benguet Lumber" which they jointly managed until Tan EngKee's
death. Petitioners herein averred that the business prospered due to the hard work and thrift of the
alleged partners. However, they claimed that in 1981, Tan Eng Lay and his children caused the
conversion of the partnership "Benguet Lumber" into a corporation called "Benguet Lumber Company."
The incorporation was purportedly a ruse to deprive Tan EngKee and his heirs of their rightful participation
in the profits of the business. Petitioners prayed for accounting of the partnership assets, and the
dissolution, winding up and liquidation thereof, and the equal division of the net assets of Benguet
Lumber. The RTC ruled in favor of petitioners, declaring that Benguet Lumber is a joint venture which is
akin to a particular partnership. The Court of Appeals rendered the assailed decision reversing the
judgment of the trial court.
ISSUE: Whether the deceased Tan EngKee and Tan Eng Lay are joint adventurers and/or partners in a
business venture and/or particular partnership called Benguet Lumber and as such should share in the
profits and/or losses of the business venture or particular partnership
RULING:
There was no partnership whatsoever. Except for a firm name, there was no firm account, no firm
letterheads submitted as evidence, no certificate of partnership, no agreement as to profits and losses,
and no time fixed for the duration of the partnership. There was even no attempt to submit an accounting
corresponding to the period after the war until Kee's death in 1984. It had no business book, no written
account nor any memorandum for that matter and no license mentioning the existence of a partnership.

Also, the trial court determined that Tan EngKee and Tan Eng Lay had entered into a joint venture, which
it said is akin to a particular partnership. A particular partnership is distinguished from a joint adventure, to
wit:(a) A joint adventure (an American concept similar to our joint accounts) is a sort of informal
partnership, with no firm name and no legal personality. In a joint account, the participating merchants can
transact business under their own name, and can be individually liable therefor. (b) Usually, but not
necessarily a joint adventure is limited to a SINGLE TRANSACTION, although the business of pursuing to
a successful termination maycontinue for a number of years; a partnership generally relates to a
continuing business of various transactions of a certain kind. A joint venture "presupposes generally a
parity of standing between the joint co-ventures or partners, in which each party has an equal proprietary
interest in the capital or property contributed, and where each party exercises equal rights in the conduct
of the business. The evidence presented by petitioners falls short of the quantum of proof required to
establish a partnership. In the absence of evidence, we cannot accept as an established fact that Tan
EngKee allegedly contributed his resources to a common fund for the purpose of establishing a
partnership. Besides, it is indeed odd, if not unnatural, that despite the forty years the partnership was
allegedly in existence, Tan EngKee never asked for an accounting. The essence of a partnership is that
the partners share in the profits and losses .Each has the right to demand an accounting as long as the
partnership exists. A demand for periodic accounting is evidence of a partnership. During his lifetime, Tan
EngKee appeared never to have made any such demand for accounting from his brother, Tang Eng Lay.
We conclude that Tan EngKee was only an employee, not a partner since they did not present and offer
evidence that would show that Tan EngKee received amounts of money allegedly representing his share
in the profits of the enterprise. There being no partnership, it follows that there is no dissolution, winding
up or liquidation to speak of.