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Partnership Dissolution Guidelines

1) The document outlines various causes for the dissolution of a partnership under Philippine law, including expiration of term, withdrawal of a partner, loss of partnership property, death or insolvency of a partner, conduct that makes continuing the partnership impracticable, the business being operated at a loss, or other circumstances making dissolution equitable. 2) It also discusses the effects of dissolution, including that it terminates the partnership's legal status and a partner's authority to act for the partnership, except as needed to wrap up unfinished business. 3) The document specifies that a partnership may be dissolved by court order upon the application of a partner or the partner's assignee.

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Ken Darryl Tagolgol
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46 views2 pages

Partnership Dissolution Guidelines

1) The document outlines various causes for the dissolution of a partnership under Philippine law, including expiration of term, withdrawal of a partner, loss of partnership property, death or insolvency of a partner, conduct that makes continuing the partnership impracticable, the business being operated at a loss, or other circumstances making dissolution equitable. 2) It also discusses the effects of dissolution, including that it terminates the partnership's legal status and a partner's authority to act for the partnership, except as needed to wrap up unfinished business. 3) The document specifies that a partnership may be dissolved by court order upon the application of a partner or the partner's assignee.

Uploaded by

Ken Darryl Tagolgol
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

agreement between the partners; or (2) in agreement, or otherwise so conducts

contravention of the agreement. Other himself in matters relating to the


specific causes are; (3) an event which partnership business that it is not
makes the business of the partnership reasonably practicable to carry on
unlawful; (4) loss of a specific thing the business in partnership with him.
which a partner had promised to
contribute to the partnership; (5) the 5. The business of the partnership can
death of a partner; (6) the insolvency of only be carried on at a loss.
any partner or of the partnership itself;
(7) civil interdiction of any partner; and 6. Other circumstances render
lastly (8) by judicial decree. a dissolution equitable.

Partnership ceased upon expiration of On the application of the purchaser of a


term; no more juridical personality partner's interest under Article 1813 or
A partnership having ceased to exist 1814:
since 1959, the partnership has no more
juridical personality nor capacity to sue 1. After the termination of the specified
and be sued. (Reynolds Philippine term or particular undertaking.
Corporation vs. Court of appeals, G.R. No.
36187, Jan. 17, 1989) 2. At any time if the partnership was a
Effect of Withdrawal before expiration of partnership at will when the interest
the term was assigned or when the charging
Under Article 1830, even if there is a order was issued.
specified term, one partners cause its
dissolution by expressly withdrawing eve n Who may petition for dissolution
before the expiration of the period, with Dissolution of a partnership may be
or without justifiable cause. Of course, if decreed by the court on application
the cause is not justified or no cause either (1) by a partner or, in case he has
was given, the withdrawing partner is assigned his interest, (2) by his
liable for damages but in no case can he assignee.
be compelled to remain in the firm. With
his withdrawal, the number of members Art. 1832. Except so far as may be
is decreased, hence, the dissolution. necessary to wind up partnership affairs
And in whatever way we view the or to complete transactions begun but
situation, the conclusion is inevitable not then finished, dissolution terminates
that the partners were to be guided in all authority of any partner to act for the
the liquidation of the partnership by the partnership:
provisions of its duly registered articles of
partnership. (Roxas vs. Maglana, G.R. L- 1. With respect to the partners
30616, Dec. 10, 1990)
a. When the dissolution is not by
Art. 1831. On application by or for a partner the act, insolvency or death of a
the court shall decree a dissolution partner.
whenever:
b. When the dissolution is by such
1. A partner has been declared insane in act, insolvency or death of a
any judicial proceeding or is shown partner, in cases where article
to be of unsound mind. 1833 so requires.

2. A partner becomes in any other way 2. With respect to persons not partners,
incapable of performing his part of as declared in article 1834.
the partnership contract.
General Rule
3. A partner has been guilty of such If the cause of dissolution is not by act,
conduct as tends to affect death, or insolvency of a partner, the
prejudicially the carrying on of the authority ceases immediately.
business. Exception
For the purposes of winding-up
4. Apartnerwillfullyorpersistently partnership affairs.
commits a breach of the partnership

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