Published — May 26, 2021
The following post does not create a lawyer-client relationship between Alburo Alburo and Associates Law Offices (or any of its lawyers) and the reader. It is still best for you to engage the services of your own lawyer to address your legal concerns, if any.
Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
WHAT ARE THE PROPERTY RIGHTS OF A PARTNER? Read also: EXISTENCE OF PARTNERSHIP WITHOUT BEING LEGALLY FORMED
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A partner is co-owner with his partners of specific partnership property
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A partner’s interest in the partnership is his share of the profits and surplus
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A partner has the right to participate in the management of the partnership
Under the Civil Code of the Philippines, the property rights of a partner are his rights in specific partnership property, his interest in the partnership, and his right to participate in the management.
What does it mean when a partner is a co-owner with his partners of specific partnership property?
The law says:
The incidents of said ownership are such that:
- A partner, subject to the provisions of the Civil Code of the Philippines and to any agreement between the partners, has an equal right with his partners to possess specific partnership property for partnership purposes. However, a partner has no right to possess such property for any other purpose without the consent of his partners.
- A partner’s right in the specific partnership property is not assignable except in connection with the assignment of rights of all the partners in the same property.
- A partner’s right in specific partnership property is not subject to attachment or execution, except on a claim against the partnership. When the partnership property is attached for a partnership debt, the partners, or any of them, or the representatives of a deceased partner, cannot claim any right under the homestead or exemption laws.
- A partner’s right in specific property is not subject to legal support.
If a partner conveys his whole interest in the partnership, would it dissolve the partnership?
The law says:
No.
A conveyance by a partner of his whole interest in the partnership does not of itself dissolve the partnership. The assignee, during the continuance of the partnership, is not entitled to interfere in the management or administration of the partnership business or affairs. Also, said assignee is not allowed to inspect the partnership books. The conveyance or transfer merely entitles the assignee to receive in accordance with his contract the profits to which the assigning partner would otherwise be entitled. However, in case of fraud in the management of the partnership, the assignee may avail himself of the usual remedies.
In case of dissolution of the partnership, the assignee is entitled to receive his assignor’s interest and this time, may require an account from the date only of the last account agreed to by all the partners.
Furthermore, take note that another interest of a partner in the partnership is his share in the profits and surplus.
Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.
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