CHAPTER 2 sec. 1 Flashcards
(24 cards)
Relationships in a Partnership
(Clue: 4 key relationships in partnerships)
Among partners
Partners & partnership
Partnership & third parties
Partners & third parties
Commencement of a Partnership (Article 1784)(Clue: Timing depends on contract or future conditions)
General Rule: Begins at contract signing.
Exception: May begin on a future date or upon conditions.
Duration of a Partnership (Article 1785)
(Clue: Time vs. goal completion)
Explicitly defined duration or implied until goal achieved.
Duty to Contribute (Article 1786)
(Clue: Contribute at the start)
Contribution required at formation.
Liability for delay without demand.
Duty to Warrant Against Eviction (Article 1786)
(Clue: Secure contributions)
Partners must provide a warranty against eviction for contributed items.
Duty to Deliver Fruits (Article 1786)
(Clue: Contribute fruits = benefits)
Deliver the benefits (fruits) from the time contributions are due.
Duty to Indemnify for Damages (Article 1786)
(Clue: Late = damages)
Must compensate for damages if contributions are delayed.
- Extent of Contribution (Article 1790)
(Clue: Equal unless contract says otherwise)
Equal shares presumed unless agreed otherwise.
Appraisal of Goods (Article 1787)
(Clue: Contract or experts for appraisal)
Appraisal by contract or experts at current market prices.
Obligations Regarding Monetary Contributions (Article 1788)
Clue: Contribute, reimburse, and pay interest)
Contribute on time, reimburse if withdrawn, pay interest for delays, and compensate for damages.
Duty to Contribute Additional Capital (Article 1791)
(Clue: Extra cash to avoid losses)
Capitalist partner must contribute extra to prevent losses.
Risk of Loss Until Contribution (Article 1795)
(Clue: Risk is on the contributor before delivery)
Partners bear the risk of loss until the item is delivered.
Risk of Loss - Specific and Determinate Things (Article 1795)
(Clue: Risk shifts when ownership shifts)
If ownership is transferred, the partnership bears the risk.
Risk of Loss - Fungible Things (Article 1795)
(Clue: Risk transfers for fungibles at contribution)
Partnership bears the risk once the fungible things are contributed.
Risk of Loss - Appraised Items (Article 1795)
(Clue: Appraised value = partnership risk)
Risk borne by the partnership for appraised contributions.
Duty Not to Engage in Any Business (Article 1789)
(Clue: Industrial partner focus = no personal businesses)
Industrial partners can’t run personal businesses without permission.
Effect of Violation (Article 1789)
(Clue: Breach = expulsion, claim, or damages)
Partner may be excluded, partnership can claim benefits or damages
Duty of Managing Partner (Article 1792)
(Clue: Split payments between debts)
Payments must be allocated to both debts proportionately.
Duty to Share from Insolvent Debtors (Article 1793)
(Clue: Share payment from insolvent debtors)
Partner collecting payment from an insolvent debtor must share with other partners.
Duty to Pay for Damages Caused by Fault (Article 1794)
Clue: Fault = damages owed to partnership)
Partners are liable for damages from their faults.
Duty to Refund Expenses (Article 1796)
(Clue: Partnership pays back with interest)
Partnership must refund expenses paid on its behalf with interest.
Duty to Answer for Obligations (Article 1796)(Clue: Partnership honors partner’s good-faith contracts)
Partnership is bound by contracts made in good faith by partners.
Right to Inspect Books (Article 1805)
(Clue: Books accessible at business location
Books must be available at the principal place of business.
Right to Demand a Formal Account (Article 1809)(Clue: WAPO exceptions for accounting)
Not required until dissolution unless
-If a partner is wrongfully excluded from partnership activities.
-If stipulated by the partnership agreement.
-If profits are derived from improper transactions related to the partnership.
-If circumstances justify it.
