BM1905
TASK PERFORMANCE
Case digest
A digest is a summary of the Supreme Court cases. It has three (3) parts: facts, issue, and ruling. The
facts part consists only of the essential facts relevant to the ruling in the case while the issue should be
relevant to the topic under which the case belongs. The ruling should answer the issue raised in the case.
The cases can be found on elibrary.judiciary.gov.ph
The case digest should be handwritten on a sheet of yellow pad paper.
Obligations of Partners
GR no. 97212 Benjamin Yu vs. national Labor Relations Commission June 30, 1993
Facts:
Yu – ex-Assistant General Manager of the marble quarrying and export business operated by a registered
partnership called Jade Mountain Products Co. Ltd. Partnership was originally organized with Bendals as
general partners and Chin Shian Jeng, Chen Ho-Fu and Yu Chang as limited partners; partnership business
consisted of exploiting a marble deposit found on land owned by the Sps. Ricardo and Guillerma Cruz
situated in Bulacan Province.
Yu, as Assistant General Manager, had a monthly salary of 4,000. Yu, however, actually received only half
of his stipulated salary, since he had accepted the promise of the partners that the balance would be paid
when the firm shall have secured additional operating funds from abroad. Yu actually managed the
operations and finances of the business; he had overall supervision of the workers at the marble quarry in
Bulacan and took charge of the preparation of papers relating to the exportation of the firm’s products.
General partners Bendals sold and transferred their interests in the partnership to Co and Emmanuel
Zapanta.
Yu remained to be unpaid and was not retained by Co and Zapanta. Thus, he approached the two to be
reinstated and to be paid salary.However, the two averred that they were not obliged to either reinstate nor
pay Yu since a new partnership was formed. Thus, Yu filed for illegal dismissal and recovery of unpaid
salaries.
Partnership was constituted solely by Co and Zapanta; it continued to use the old firm name of Jade
Mountain.
Issues:
Whether the partnership which had hired petitioner Yu as Assistant General Manager had been extinguished
and replaced by a new partnership composed of Willy Co and Emmanuel Zapanta. Was the old partnership
dissolved?
If indeed a new partnership had come into existence, whether petitioner Yu could nonetheless assert his
rights under his employment contract as against the new partnership. May Yu recover his unpaid salary from
the new partners? May Yu be reinstated?
Rulling:
No, the old partnership was not dissolved. The Court held that Art. 1828 provides that a partnership may be
dissolved by a change in partners in relation to the rules of Art. 1830. However, Art. 1828 provides that the
legal personality of the expiring partnership persists for the limited purpose of winding up and closing of the
affairs of the partnership – such as the payment of its debts, liquidation, and distribution of the new assets,
and the assets being reassembled to open a new business enterprise. In this case, the debt Jade Mountain
owed to Yu was still unpaid. Thus, the legal personality of the old partnership is not terminated. The
business of the old partnership was simply continued by the new partners, without the old partnership
undergoing procedures relating to the dissolution and winding up of its business affairs.
Yes, Yu may still recover his unpaid salary from the new partners. The Court held that under Art. 1840, the
creditors of the old Jade Mountain are also the creditors of the new Jade Mountain which continued the
business of the old one without liquidation of the partnership affairs.Thus, Yu may claim from the new Jade
Mountain. Furthermore, he may also claim from the old creditors as well. Yu may not be reinstated under the
new partnership. The Court held that the new partnership was entitled to appoint another manager in place
of Yu to run the affairs of the business. The non-retention of Yu cannot be considered unlawful termination
or termination without just cause.
•
Rubric for grading:
CRITERIA PERFORMANCE INDICATORS POINTS
Included significant facts and clear legal issues and jurisdictions,
Content 6
and provided clear conclusions and answers
Grammar Used correct grammar, punctuation, spelling, and capitalization. 1
Organization of Expressed the points in clear and logical arrangement of ideas in
Ideas 2
the paragraph
Format Adhered to the required style or appearance 1
TOTAL 10
02 Task Performance 1 *Property of STI
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