Parte Proceedings Against Petitioners and The Decision On December 20, 1974. Respondent Court Is Hereby Ordered To Enter An Order

Antonio Lim Tanhu, DyOchay, Alfonso Leonardo Ng Sua and AUTHOR: Nikki A
Co Oyo vs. Hon. Ramolete and Tan Put DOCTRINE: A partner’s right to accounting for properties of the
TOPIC: Property Rights of a Partner partnership that are within the custody or control of the other
PONENTE: Barredo, J.: partners shall apply only when there is proof that such properties,
registered in the individual names of the other partners, have been
acquired from the use of partnership funds.
FACTS
 Respondent Tan Put filed a complaint against spouses Lim Tanhu and DyOchay, spouses Alfonso Leonardo Ng Sua and Co
Oyo and their son Eng Chong Leonardo for the share of Tee Hoon Lim Po Chuan in the partnership.
 Tan Put alleged the following:
i. that she is the widow of Tee Hoon Lim Po Chuan, who was a partner in the commercial partnership, Glory
Commercial Company with Antonio Lim Tanhu and Alfonso Ng Sua.
ii. that the defendant-petitioners, through fraud and machination, took actual and active management of the
partnershi and although Tee Hoon Lim Po Chuan was the manager of Glory Commercial Company,
defendant-petitioners managed to use the funds of the partnership to purchase lands in the cities of Cebu,
Lapulapu, Mandaue, and the municipalities of Talisay and Minglanilla.
iii. that after the death of her husband, the defendants, without liquidation of the partnership, organized a
corporation with the paid-up capital from the partnership. She contends that one-third of the interest belongs
to her late husband.
iv. When her husband died, he asked the defendants to liquidate the partnership but the defendants never did.
Later on, she was made to sign a quitclaim of all her rights and interest in the partnership in consideration of
P65,000.00. Said quitclaim was in the Hands of Lim Tanhu and a copy was never given to her.
v. That she gave some of her money to her husband for the start-up capital of the partnership
 Defendant-petitioners replied to her complaint alleging:
i. AngSiok Tin is the legitimate wife, still living, and with whom Tee Hoon had four legitimate children, a twin
born in 1942, and two others, all residing in Hong Kong. Tee Hoon died in 1966 and as a result of which the
partnership was dissolved and what corresponded to him were all given to his legitimate wife and children.
ii. Tan Put is aware that she is the common law wife of Tee Hoon.
 Defendants also filed a counterclaim against Tan Put for causing delay in the operations of the business.
 (Note: This case involves a lot of appeals; motion to quash and 2 petitions for certiorari but I will stick to the partnership issue
only.)
 Tan Put asked the lower court to dismiss the complaint as to the spouses Leonardo Ng Sua but retained with respects to Tanhu
and Ochay.
 The lower court allowed the dismissal in part and allowed a motion to hold the petitioners in default, and motion to present
evidence ex-parte. (The judge here was very biased).
ISSUE: Whether or not Tan Put, the common law wife of Tee Hoon, has a right on behalf of Tee Hoon to claim his share in the
partnership.
HELD: NO.
RATIO:
1. Tan Put cannot be considered as a legal party in interest because she was unable to prove that her marriage was valid and
subsisting. There was no marriage contract shown nor evidence to support that such a marriage existed.
2. An agreement with Tee Hoon was shown and signed by Tan Put that she received P40,000 for her subsistence when they
terminated their relationship of common-law marriage and promised not to interfere with each other’s affairs.
3. Stated differently, since the existence of the quitclaim has been duly established without any circumstance to detract from its
legal import, the court should have held that plaintiff was bound by her admission therein that she was the common-law wife
only of Po Chuan and what is more, that she had already renounced for valuable consideration whatever claim she might have
relative to the partnership Glory Commercial Co.
4. In the light of all these circumstances, We find no alternative but to hold that plaintiff Tan Put's allegation that she is the widow
of Tee Hoon Lim Po Chuan has not been satisfactorily established and that, on the contrary, the evidence on record
convincingly shows that her relation with said deceased was that of a common-law wife and furthermore, that all her claims
against the company and its surviving partners as well as those against the estate of the deceased have already been settled
and paid.
5. If Po Chuan was in control of the affairs and the running of the partnership, how could the defendants have defrauded him of
such huge amounts as plaintiff had made his Honor believe? Upon the other hand, since Po Chuan was in control of the affairs
of the partnership, the more logical inference is that if defendants had obtained any portion of the funds of the partnership for
themselves, it must have been with the knowledge and consent of Po Chuan, for which reason no accounting could be
demanded from them therefor, considering that Article 1807 of the Civil Code refers only to what is taken by a partner without
the consent of the other partner or partners.
6. Accordingly, defendants have no obligation to account to anyone for such acquisitions in the absence of clear proof that they
had violated the trust of Po Chuan during the existence of the partnership.
Dispositive Portion: IN VIEW OF ALL THE FOREGOING, the petition is granted. All proceedings held in respondent court in its Civil
Case No. 12328 subsequent to the order of dismissal of October 21, 1974 are hereby annulled and set aside, particularly the ex-
parte proceedings against petitioners and the decision on December 20, 1974. Respondent court is hereby ordered to enter an order
extending the effects of its order of dismissal of the action dated October 21, 1974 to herein petitioners Antonio Lim Tanhu, DyOchay,
Alfonso Leonardo Ng Sua and Co Oyo. And respondent court is hereby permanently enjoined from taking any further action in said civil
case gave and except as herein indicated. Costs against private respondent.

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Antonio Lim Tanhu, DyOchay, Alfonso Leonardo Ng Sua and AUTHOR: Nikki A

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