1815 - 1827 Flashcards
The name, title, or style under which a company transacts business.
Firm Name
Importance of Firm Name
To distinguish the partnership which has a distinct and separate juridical personality.
Right of a partner to choose firm name
The partners may use any firm name desired and this will be the name of that juridical person.
Certain restriction of choosing a firm name:
The partnership cannot use:
- Identical or deceptively confusingly similar to any existing partnership or to any other name already protected by law.
- Contraty to existing laws.
Non partners who include their names in the firm name shall be?
Subject to the Liability, it is to protect the innocent third persons being misled.
When a debtor is liable ONLY for the payment of only a proportionate part of the debt.
Liability is JOINT
Makes a debtor liable or the payment of the entire debt.
Solidary
Article 1207 does not presume solidary liability unless:
- the obligation expressly so states
- the law or nature required solidarity
The industrial partner is only liable to?
Liability only not to losses, meaning he/she can ask for reimbursement.
Means equally or joint, or proportionate distribution of liability.
Pro-rata Liability
The partner’s separate property may be held liable only after the partnership creditors’ exhausted the assets of the partnership.
Subsidiary
Separate obligation of a partner
If a partner enters into a contract with a third person, then it is only that partner who is liable and not the partnership.
A stipulation against liablity of all partners for the contracts entered into in the name of the partnership is?
VOID = as to third persons
VALID = as among the partners
Except when authorized by the other partners or unless they have abandoned the business, one or more but less than all the partners have no authority to:
- Assign the partnership property in trust for creditors or on the assignee’s promise to pay the debts of the partnership
- Dispose of the goodwill of the business
- Do any other act which would make it impossible to carry on the ordinary business of the partnership
- Confess a judgment
- Enter into a compromise concerning a partnership claim or liability
- Submit a partnership claim or liability to arbitration
- Renounce a claim of the partnership.
If a partner ACTS WITHOUT AUTHORITY and the other party KNOWS the partner had no authority, the Partnership is?
NOT BOUND/NO LONGER BINDING
If a partner DOES SOMETHING OUTSIDE THE NORMAL BUSINESS
It WON’T BIND the partnership unless the other partners approve
Acts Apparently for Carrying on in Usual Way the Business of the Partnership
Such acts bind the partnership unless:
a. The partner so acting has in fact NO AUTHORITY to act for the partnership
b. The person with whom the partner is dealing HAS KNOWLEDGE of this lack of authority (bad faith).
Acts Not Apparently for Carrying on in Usual Way the Business of the Partnership
It does NOT BIND the partnership, unless authorized by the partners
Acts of Ownership
If a partners wants to sell, mortgage, or, transfer major partnership assets, the authority here must come from ALL (unanimous) of the partners.
Acts in Contravention of a Restriction on Authority
Such acts DO NOT BIND the partnership if the person dealing with the partner HAS KNOWLEDGE of the restriction.
Legal evidence of a person’s ownership rights in property; an instrument that constitutes such evidence.
Title
An interest held by virtue of an equitable title or claimed on equitable grounds, such a the interest held by a trust beneficiary.
Equitable Interest
Real Property may be registered or owned in the name of:
- The partnership
- One or more but not all the partners
- One or more or all the parners, or in a third person in trust for the partnership
- All the partners
It is a statement in which someone acknowledges that something is true or that they have done something wrong.
Admission
Admission by any partner is evidence against the partnership if:
- The admission must concern partnership affairs
- The admission must be within the scope of his authority
An admission by a FORMER partner, after retirement, is?
NOT evidence against the firm.
Article 1821 General Rule:
Notice to a partner is notice to the partnership
Instances where knowledge of a partner is considered knowledge of the partnership
- Knowledge of the partner acting in the particular matter acquired while a partner
- Knowledge of the partner acting in the particular matter then present to his mind
- Knowledge of any other partner who reasonably could and should have communicated it to the acting partner
EXPN: This rule does not apply in cases of fraud committed by or with the consent of that partner against the partnership.
Article 1822 Wrongful Act or Omission
The partnership is liable for any loss, injury, or penalty caused by a partner’s wrongful act or omission if it occurs in the ordinary course of business or with the authority of co-partners.
Liability extends to the same extent as the responsible partner.
The partnership is bound to make good the loss:
- When a partner, acting within apparent authority, receives money or property from a third party and misapplies it.
- When the partnership in the course of its business receives money or property from a third party, and any partner misapplies it while in the partnership’s custody.
In cases where money or property is entrusted for a specific purpose, and a partner later misappropriates it, the court has ruled that such action constitutes _______.
Estafa, a crime of swindling.
What is the extent of a partner’s liability for obligations chargeable to the partnership?
All partners are solidarily liable with the partnership
If he has made such a representation or consented to its being made in a public manner, he is liable to such persons, whether or not the representation has been made or communicated to them with the knowledge of the apparent partner making the representation or consenting to it.
- When a partnership liability results, he is liable as though he were an actual member of the partnership.
- When no partnership liability results, he is liable pro rata with the other persons, if any, consenting to the contract or representation, otherwise separately.
Arises if all the partners consented to the misrepresentation of a third person who is not a real partner.
Partnership by estoppel
A person who represents himself, or consents to another or others representing him to any one, as a partner either in an existing partnership or in one that is ficititious or apparent.
Partner by estoppel
What is the liability of a person admitted into an existing partnership for obligations incurred before their admission, as outlined in Art. 1826?
Liable for all obligations. However, this liability is satisfied only out of partnership property, unless there is a stipulation to the contrary.
What is the priority of creditors in relation to partnership property as outlined in Art. 1827?
The CREDITORS OF THE PARTNERSHIP are PREFERRED over the private creditors of each partner concerning the partnership property.
However, the private creditors of a partner may still request the attachment and public sale of the partner’s share in the partnership assets.
