Reporter: APALLA, MARK ARTEM L.
Article 1781, NCC
Articles of universal partnership entered into without
specification of its nature, only constitute a universal
partnership of profits.
 Presumption in favor of universal partnership of profits.
-Where the articles of partnership do not specify the
nature of the partnership whether it is one of “present
property” or of “profits” only, it will be presumed that
the parties intended merely a partnership of profits.
 In case of doubt
Article 1378 of NCC provides when it is absolutely
impossible to settle doubts by the rules established in
the preceding articles, and the doubts refer to incidental
circumstances of a gratuitous contract, the least
transmission of rights and interest shall prevail. If the
contract is onerous, the doubt shall be settled in favor of
the greatest reciprocity of interest.
 It is to be noted that Article 1781 applies only when a
universal partnership has been organized.
Article 1782, NCC
Persons who are prohibited from giving each other
any donation cannot enter into a universal
partnership.
 Limitations upon the right to form a partnership.
- Persons who are prohibited by law to give donation
cannot enter into universal partnership for the
reason that each of the partners virtually makes a
donation.
Legal bases must be noted:
- Art. 87 of the Family Code in relation to Art 109
provides that every donation or grant of gratuitous
advantage, direct or indirect, between the spouses
during the marriage shall be void, except moderate
gifts, which the spouses may give to each other on
the occasion of any family rejoicing. The prohibition
shall also apply to persons living together as
husband and wife without a valid marriage.
 - Art 739, NCC. The following donations shall be void:
1. Those made between persons who were guilty of
adultery or concubinage at the time of the donation.
2. Those made between persons found guilty of the
same criminal offense, in consideration thereof;
3. Those made to a public officer or his wife,
descendants and ascendants, by reason of his office.
Commissioner of Internal Revenue vs. Suter, 27 SCRA 152
(1969) (limited partnership)
-A husband and his wife, however may enter into a
particular partnership or be members thereof.
Article 1783, NCC
A particular partnership has for its object determinate
things, their use or fruits, or a specific undertaking, or
the exercise of a profession or vocation.
 Universal Partnership vs Particular Partnership
As to subject matter or object, the former’s object is vague
and indefinite contemplating a general business with some
degree of continuity, while the latter it is limited and well
defined, being confined to an undertaking of a single,
temporary, or ad hoc nature.
As to liability of the partners, partnership may be general
or limited. A general partnership is one where one of the
partners are general partners, while a limited partnership
is one where there is at least one general and one limited
partner.
 Examples of Particular or Limited Partnership
1. Acquisition of an immovable property for the
purpose of reselling it at a profit or for the common
enjoyment of its use and the benefits derived
therefrom.
2. Established for the purpose of carrying out a specific
enterprise such as the construction of a building or
 those formed for the practice of profession or
vocation. (11 Manresa 318-319)

 Business of the partnership need not be continuing in

nature.

1. Under the Uniform Partnership Act of the American Law,
defines a partnership as an association of two or more
persons to carry on as co-owners a business for profit and
states that business includes every trade , occupation, or
profession.
In light with this Act, the word “business” clearly
means business in the commercial sense only, not merely “
a joint venture” which exist for carrying on a single act or
isolated transaction or a limited number of transactions.
2. Joint Venture - “Joint Adventure or Joint Enterprise”
in American Law, it is essentially a partnership created for
a limited purpose.
3. Corporation as a partner
Tuazon vs. Bolanos, 95 Phil 906 (1954)
Supreme Court recognized and held that although a
corporation cannot enter into a partnership
contract, it may , however engage in a joint venture
with others through a contract or agreement if the
nature of the venture is authorized by its charter
(SEC Opinion, April 1985)

Primelink Properties & Development Corp. vs. Lazatin-

Magat, 493 SCRA 444 (2006)

Joint venture is akin to particular partnership there is a

community of interest in the business and a mutual right of
control and an agreement to share jointly in profits and
losses resulting from the enterprise.