Chapter 2: lesson 1 Flashcards
Right to contribution
The partnership has a right to the contribution from the partners. The money or property contributed, or their use of fruits becomes the property of the partnership. Regardless of the nature of
Article 1786
If a partner promised to contribute specific property, he is obliged to preserve said property with the diligence of a good father of a family pending delivery to the partnership. If he fails to contribute the property that he promised, he becomes ipso jure liable as a debtor of the partnership, without the need of any demand, and the other partners can file an action against him for a specific performance with damages.
Article 1787
When what is to be contributed by the partner consists of goods, there should be an appraisal of the value of said goods in accordance with the agreement of the partners to determine how much has been contributed by the partners and if there is no agreement, the appraisal shall be done by the experts chosen by the partners and according to current prices.
Article 1788
Provides that every partner is required to contribute on the date due the amount he has promise to contribute to the partnership and to reimburse any amount he may have taken from the common fund and converted to his own use.
Article 1790
If there is no agreement on the contribution of unequal shares to the common fund, it is presumed that the partners’ contributions are in equal shares.
(Right to Additional Contribution)
Article 1791
A capitalist partner is one who contributes money, or property to a common fund. As a general rule, he is not bound to contribute to the partnership more that what he agreed to contribute. However, in case of imminent loss of the business of the partnership where the majority of the capitalist partners are of the opinion that an additional contribution to the common fund would save the business, and in the absence of an agreement to the contrary he is obliged to contribute additional share to save the business.
Rights to Apply Payment Received to Partnership Credit
One who manages the business of the partnership is commonly referred to as managing partner. He is appointed in either in the articles of partnership or after the constitution of the partnership.
Article 1792
A partner authorized to manage, who collects a demandable sum owed to him in his own name from a person who also owes the partnership a demandable sum, is obliged to apply the sum collected to to both credits pro rata, even if he issued a receipt for his own credit only.
(Right to Return of Credit Received) Article 1793
A partner authorized to manage or not, who already received, in whole or in part, a share of a partnership credit, is obliged to bring to the partnership capital what he received when other partners have not collected their shares and the partnership debtor has become insolvent. This obligation exists when he issued a receipt for his share only.
(Right to Indemnity for Damages) Article 1794
Every partner is responsible to the partnership for damages suffered by it through his fault. As a general rule, the liability for damages cannot be set-off or compensated by profits or benefits which the partner may have for the partnership by his industry; but if unusual profits are realized through the extraordinary efforts of the partner at fault, the court may equitably mitigate the liability for damages of the partner at fault.
Article 1795
In determining who bears the risk of loss of the things contributed to the partnership, the following rules apply:
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Suit for Damages
Before a partner may sue another for alleged fraudulent management and resultant damages, there must be a liquidation first to determine the extent of the damage. Without the liquidation of partnership affairs, a partner cannot claim damages.
Responsibility to Partners (Article 1796)
The partnership is obliged to refund to the partner the amounts disbursed by him on behalf of the partnership, such as advances for the partnership obligations due and payable, together with the corresponding interest from the time the expenses were incurred.
