Island Sales v.

United 65

the

plaintiff

to

present

its

evidence ex-parte , after which the trial court

SCRA 554
DOCTRINE:

authorized

rendered the decision appealed from.

Condonation

by

creditor

of

share in partnership debt of one partner does

The defendants Benjamin C. Daco and Noel

not

C. Sim moved to reconsider the decision

increase

pro

rata

liability

of

other

partners.

claiming that since there are five (5) general

partners, the joint and subsidiary liability of

FACTS:

each partner should notexceed one-fifth (1/5)

The defendant company ( UNITED PIONEERS

of the obligations of the defendant company.

GENERAL CONSTRUCTION COMPANY ET .AL ),

But the trial court denied the said motion

a general partnership duly registered under

notwithstanding

the laws of the Philippines, purchased from

plaintiff to limit the liability of the defendants

theplaintiff ( ISLAND SALES, INC) a motor

Daco and Sim to only one-fifth (1/5 ) of the

vehicle on installment basis and for this

obligations of the defendant company.Hence,

purpose

this appeal.

executed

apromissory

note

for

the

conformity

of

the

P9,440.00, payable in twelve (12) equal

monthly installments of P786.63, the first

ISSUE:

installment payable on or before May 22,

partners share in the debts of the company

1961 and the subsequent installments on the

increases the remaining partners liability?

Whether the condonation of a

22nd day of every month thereafter, until

fully paid, with the condition that failure to

RULING:

pay any of said installments asthey fall due

No. In the instant case, there were five (5)

would render the whole unpaid balance

general partners when the promissory note

immediately due and demandable.

in question was executed for and in behalf of

the partnership. Since the liability of the

Having failed to receive the installment due

partners is pro rata, the liability of the

on July 22, 1961, the plaintiff sued the

appellant Benjamin C. Daco shall be limited

defendant company for the unpaid balance

to only one-fifth ( 1/ 5 ) of the obligations of

amounting to P7,119.07. Benjamin C. Daco,

the defendant company. The fact that the

Daniel A. Guizona, Noel C. Sim, Romulo B.

complaint against the defendant Romulo B.

Lumauig, and Augusto Palisoc were included

Lumauig was dismissed, upon motion of the

as co-defendants in their capacity as general

plaintiff, does not unmake the said Lumauig

partners of the defendant company.

as a general partner in
company.

the

defendant

In so moving to dismiss the

Daniel A. Guizona failed to file an answer and

complaint, the plaintiff merely condoned

was

Lumauig's individual liability to the plaintiff.

consequently

declared

in

default.

Subsequently, on motion of the plaintiff, the

complaint was dismissed insofar as the

RATIO: Article 1816 of the Civil Code

defendant Romulo B. Lumauig is concerned.

provides:

When the case was called for hearing, the

All partners including industrial ones,

defendants and their counsels failed to

shall be liable pro rata with all their

appear notwithstanding the notices sent to

property and after all the partnership

them.

assets have been exhausted, for the

Consequently,

the

trial

court

contracts which may be entered into in

partnership. However, any partner may

the name and for the account of the

enter

partnership, under its signature and by

perform

a person authorized to act for the

into

separate

obligation to