FAR- PARTNERSHIP AND CORPORATION

The written contract of a partnership is called Articles of Co-Partnership. Among others. the Articles of Co-Partnership contain the following information:

1. the name of the partnership; 2. the names. citizenship and residences of the partners; 3. the effective date of the contract; 4. the nature of the business, purpose and principal office of the business; 5. the capital of the partnership, stating the contributions of individual partners, their description and agreed values; 6. the rights and duties of each of the partners 7. the provisions for additional investments and withdrawals; 8. the manner in which profits and losses are to be shared;; 9. the manner of keeping the books of accounts; 10. the procedures for dissolving the partnership; and 11. the provision for arbitration in settling disputes.

Voluntary agreement

A partnership agreement is perfected by mere consent, that is, upon express or implied agreement of two or more persons.

Division of profits among partners

Based on the definition of a partnership from the New Civil Code, it is deemed that the primary purpose of a partnership is to earn profits and to divide the same among the partners in conformity with the terms of the partnership agreement.

(Article 1767 of the New Civil Code),

By contact of partnership, two or more persons may contribute money, property, or industry to a common fund with the intention of dividing the profits or move persons may also form a partnership for the a profession

Mutual Agency

Each partner acts as an agent for the other partners. This means that the partnership is legally held responsible for the acts of any partner as long as those acts relate to the normal partnership activities. However, the partnership is not bound by an act committed by any of the partner that is considered beyond the scope of partnership business.

Unlimited liability

Each partner is held personally liable for all the debts of the firm. Partnership obligations can be satisfied not only with partnership assets but also with the personal holdings or assets of each partner. When all partnership assets are exhausted and there are still partnership obligations that have not been settled, the partnership creditors can claim from the personal assets of the partners.

Mutual contribution of money, property, or industry to a common Lund

In order to become a partner in a partnership„ one must contribute money and/or property to a common fund. An individual may also be a partner by investing his services to the firm. Without the element of mutual contribution, there can be no partnership.

Co-ownership of property

The assets contributed by each partner in a partnership become the common property of all partners. No partner owns any particular piece of partnership properly

limited life

The legal life of the partnership terminates with the admission of a new partner, death, bankruptcy or withdrawal of any partner, voluntary dissolution by the partners, or by involuntary dissolution such as through bankruptcy proceedings. A partnership may also come to an end upon completion of the objective or goal for which the partnership was formed. However, the dissolution of the partnership does not necessarily terminate the partnership as a reporting entity.

Partners may be classified in a variety of ways

a. as to nature of contributions; b. as to the partners' liabilities to third persons; and c. ,as to the partners' interest or obligation to the business.

universal partnership of profits

comprises all that the partners may acquire by their industry or work during the existence of the partnership.

A particular partnership

has for their use or fruits, or a specitic undertaking, or the exercise of a profession or vocation.

universal partnership of all present property

in which the partners contribute all the property which actually belongs to them to a common fund, with the intention of dividing the same among themselves. as well as all the profits which they may acquire therewith.

professional partnership

is formed for the practice of a profession, such as auditing firm (for CPAs), law firm (for lawyers), medical clinic (for medical practitioners), and similar professions.

partnership at will

is one in which no time or period is specified for its existence and is not formed for a particular undertaking or venture. This may be terminated anytime by mutual agreement of the partners or by the will of any one partner alone.

partnership with a fixed term

is one in which the term for which the partnership will exist is fixed or agreed upon. This also applies to a partnership that is formed for a particular objective or undertaking.

commercial or trading partnership

is organized to undertake business transactions such as merchandising or manufacturing transactions

general partnership

one in which all partners are general partners, which means that the liability of all partners to the partnership creditors extend to their personal separate property.

limited partnership

one which is composed of one or more general partners and one or more limited partners. A limited partnership shall bear the word "Limited" (or "Ltd.") in its firm name.

capitalist-industrial partner

one who contributes money or property as well as his services to the partnership.

capitalist partner

one who contributes money or property into the partnership

industrial partner

one who contributes only his industry or services to the partnership

dormant partner

one who does not take active part in the business and is not known by third parties to be a partner

silent partner

one who does not take active part in the business but is known by third parties to be a partner in the business.

secret partner

one who is not known by third parties to be a partner in the business but takes active part in the business.

managing partner

one who manages the affairs of the business.

ostensible partner

one who takes active part and known to the public as a partner in the business, whether or not he has an actual interest in the firm.

General Partner

one whose liability to partnership creditors extends to his personal separate property

limited partner

one whose liability to third persons is limited to his capital contribution.

Articles 1771 and 1772 of the New Civil Code

require the partnership contract to be in public instrument when immovable property or real rights are contributed thereto or when partnership capital is at least three thousand pesos (P 3,000).