CHAPTER 2, SECTION 2
PROPERTY RIGHTS OF A PARTNER
1) ARTICLE 1810 – PROPERTY RIGHTS OF PARTNERS (SIM)
A) Specific partnership property (SPP)
B) Interest
C) Management
2) Art. 1811 - SPECIFIC PARTNERSHIP PROPERTY
WHAT ARE SPECIFIC PARTNERSHIP PROPERTIES?
This are properties, real or personal, acquired by the partnership or
contributed by the partners.
- Partners are co-owners as to SPP
- Equal right of possession for partnership purposes only
- Not assignable (impossible to determine extent of his beneficial interest)
- Not subject to execution or attachment (except claims against the
partnership)
- Not subject of legal support
3) Art. 1812,1813 - INTEREST
- Interest means the share of a partner in the profits (during the life of
the partnership) and surplus (after dissolution).
CAN A PARTNER ASSIGN HIS INTEREST IN THE PARTNERSHIP TO A 3RD
PARTY?
Yes, the interest of partner is assignable in absence of a contrary agreement.
WHAT IS THE EFFECT OF THE ASSIGNMENT OF A PARTNER’S INTEREST?
- Effect of assignment, assignee has no right to
a) Management
b) Information and account
c) Inspection of partnership books
- Rights of assignee of partner’s interest
a) To receive the share of the profits of the assigning partner
b) To avail of the usual remedies in the event of fraud in the
management
c) To receive the assignor’s interest in case of dissolution.
d) To require an accounting in case of dissolution
4) ART. 1814 – REMEDIES OF A SEPARATE JUDGMENT CREDITOR OF A
PARTNER
WHO IS A SEPARATE JUDGMENT CREDITOR OF A PARTNER?
A creditor of a partner who filed and won a case against the latter over
transactions personal to the partner or does not involve the partnership.
EXAMPLE: A partner borrowed money from a bank to finance the
construction of his family home. If the partner fails to pay the loan and the
bank filed and won a case for collection against the partner, the bank is
considered a separate judgment creditor of a partner.
WHAT ARE THE RIGHTS OF A SEPARATE JUDGMENT CREDITOR?
- Separate creditor of a partner cannot attach or levy SPP, however, he can
apply to the court for a charging order subjecting the INTEREST of the
partner for the payment of his credit.
- Without prejudice to Art. 1827 or preferred rights of partnership
creditors who are paid first before separate creditors.
- INTEREST of the partner charged by a separate creditor can be redeemed
with the (1) separate property of anyone of the partners or (2) with
partnership property with consent of all partners whose interest is not
charged.
