1) Fernando Santos, Nieves Reyes, and Meliton Zabat verbally agreed to a lending business partnership in 1986 where Santos would be the financier and receive 70% of profits while Reyes and Zabat would handle collections and receive 15% each.
2) The partnership later agreed to provide loans to members of the Monte Maria Development Corporation in exchange for commissions.
3) In August 1986, the parties executed an Article of Agreement to formally establish their partnership and profit sharing agreement. Santos later discovered that Zabat had engaged in competing business, leading to his expulsion from the partnership.
4) Santos filed a complaint against the Reyes spouses for misappropriating funds
1) Fernando Santos, Nieves Reyes, and Meliton Zabat verbally agreed to a lending business partnership in 1986 where Santos would be the financier and receive 70% of profits while Reyes and Zabat would handle collections and receive 15% each.
2) The partnership later agreed to provide loans to members of the Monte Maria Development Corporation in exchange for commissions.
3) In August 1986, the parties executed an Article of Agreement to formally establish their partnership and profit sharing agreement. Santos later discovered that Zabat had engaged in competing business, leading to his expulsion from the partnership.
4) Santos filed a complaint against the Reyes spouses for misappropriating funds
1) Fernando Santos, Nieves Reyes, and Meliton Zabat verbally agreed to a lending business partnership in 1986 where Santos would be the financier and receive 70% of profits while Reyes and Zabat would handle collections and receive 15% each.
2) The partnership later agreed to provide loans to members of the Monte Maria Development Corporation in exchange for commissions.
3) In August 1986, the parties executed an Article of Agreement to formally establish their partnership and profit sharing agreement. Santos later discovered that Zabat had engaged in competing business, leading to his expulsion from the partnership.
4) Santos filed a complaint against the Reyes spouses for misappropriating funds
1) Fernando Santos, Nieves Reyes, and Meliton Zabat verbally agreed to a lending business partnership in 1986 where Santos would be the financier and receive 70% of profits while Reyes and Zabat would handle collections and receive 15% each.
2) The partnership later agreed to provide loans to members of the Monte Maria Development Corporation in exchange for commissions.
3) In August 1986, the parties executed an Article of Agreement to formally establish their partnership and profit sharing agreement. Santos later discovered that Zabat had engaged in competing business, leading to his expulsion from the partnership.
4) Santos filed a complaint against the Reyes spouses for misappropriating funds
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SANTOS vs.
Spouses REYES 368 SCRA 261 G.R. No. 135813. October 25, 2001 Ponente: PANGANIBAN, J.
FACTS:
Sometime in June 1986, Fernando Santos, Nieves Reyes, and Meliton Zabat verbally agreed to a lending business venture proposed by Nieves. It was agreed that Santos would act as financier and would receive 70% of the profits, while Nieves and Zabat would take charge of solicitation of members and collection of loan payments and would earn 15% each.
Later in July of 1986, Nieves introduced Cesar Gragera, chairman of the Monte Maria Development Corporation, to Santos where they agreed that the partnership will provide short-term loans for members of the corporation and Gragera would be entitled to P1.31 commission per thousand paid daily.
On August 6, 1986, Santos, Nieves and Zabat executed the ‘Article of Agreement’ which formalized their earlier verbal arrangement. As agreed, Nieves kept the books as representative of Santos while [Respondent] Arsenio, husband of Nieves, acted as credit investigator. Santos and Nieves later discovered that their partner Zabat engaged in the same lending business in competition with their partnership. Zabat was thereby expelled from the partnership. The operations with Monte Maria continued.
Upon Gragera’s complaint that his commissions were inadequately remitted, Santos filed a complaint against the spouses with having misappropriated funds intended for Gragera.
The trial court held that respondents were partners, not mere employees, of petitioner. It further ruled that Gragera was only a commission agent of petitioner, not his partner. On appeal, the Decision of the trial court was upheld, and the counterclaim of respondents was dismissed. Hence, this Petition.
ISSUE:
Whether the parties’ relationship was one of partnership or of employer-employee.
HELD:
PARTNERSHIP. We agree with both courts on this point. By the contract of
partnership, two or more persons bind themselves to contribute money, property or industry to a common fund, with the intention of dividing the profits among themselves. The “Articles of Agreement” stipulated that the signatories shall share the profits of the business in a 70–15–15 manner, with petitioner getting the lion’s share. This stipulation clearly proved the establishment of a partnership.
