2. LOZANA VS.
DEPAKAKIBO
GR No. L-13680, April 27, 1960
FACTS:
Lozana and Depakakibo established a partnership for the purpose of maintaining, operating, and
distributing electric light and power in the Municipality of Dumangas. The partnership is capitalized at the
sum ofP30, 000.00 where Lozana agreed to furnish 60% while Depakakibo, 40%. However, the franchise
for venture in favor of Buenaflor was cancelled and revoked by the Public Service Commission. Lozana
thereafter sold Generator Buda, Lozana’s contribution to the partnership; no liquidation made to
Decolongon. When the decision was appealed, a temporary certificate of public convenience was issued in
the name of Decolongon. Depakakibo sold one Crossly Diesel Engine [Depakakibo’s contribution to the
partnership] to Spouses Jimenea and Harder. Lozana brought action against Depakakibo alleging the latter
wrongfully detained the Generator Buda and wooden posts to which he is entitled to the possession of.
Lozano prayed the properties be delivered back to him. CFI ordered sheriff to take possession of the
properties and the delivery thereof to Lozano. Depakakibo alleged properties have been contributed to the
partnership and therefor he is not unlawfully detaining them. In addition, Lozano sold his contribution to
partnership in violation of terms of their agreement. CFI declared Lozano owner of and entitled to the
equipment. Depakakibo appealed decision to the Supreme Court.
ISSUE:
a. W/N partnership is void or the act of the partnership in furnishing electric current to the franchise
holder without previous approval of Public Service Commission render the partnership void?
b. W/N disposal of contribution of parties is allowed.
RULING:
a. Validity of the Partnership- Partnership is valid. The fact of furnishing the current to the holder of
the franchise alone, without the previous approval of the Public Service Commission, does not per
se make the contract of partnership null and void from the beginning and render the partnership
entered into by the parties for the purpose also void and non-existent
b. Disposal of Contributed Property to the Partnership. - Facts show that parties entered into the
contract of partnership, Lozana contributing the amount of P18, 000, and there has not been
liquidation prior to the sale of the contributed properties: Buda Diesel Engine and 70 posts. It
necessarily follows that the Buda diesel engine contributed by the plaintiff had become the
property of the partnership. As properties of the partnership, the same could not be disposed of by
the party contributing the same without the consent or approval of the partnership or of the other
partner. (Clemente vs. Galvan, 67 Phil., 565)
Syllabi:
a. PARTNERSHIP; CONTRIBUTION IN KIND; DISPOSAL BY CONTRIBUTING PARTIES NOT
ALLOWED. -
An equipment which was contributed by one of the partners to the partnership becomes the
property of the partnership and as such cannot be disposed of by the party contributing the same without
the consent or approval of the partnership or of the other partner (Clemente vs. Galvan, 67 Phil., 565).
b. PARTNERSHIP; ANTI-DUMMY LAW; REFERS TO ALIENS ONLY. -
The admission by the defendant that he and the plaintiff, who are both Filipinos, are dummies of
another person, is an error of law, and not a statement of fact. Since both parties are not aliens but Filipinos,
the Anti-Dummy law has not been violated. The said law refers to aliens only (Commonwealth Act 1080 as
amended).
c. PARTNERSHIP; FURNISHING CURRENT TO FRANCHISE HOLDER WITHOUT APPROVAL OF
PUBLIC SERVICE COMMISSION; PARTNERSHIP NOT VOID AB INITIO. -
The act of the partnership in furnishing electric current to the franchise holder without the
previous approval of the Public Service Commission, does not per se make the contract of partnership null
and void' from the beginning.
