LOURDES NAVARRO AND MENARDO NAVARRO vs. COURT OF APPEALS, JUDGE BETHEL KATALBAS-MOSCARDON and Spouses OLIVIA V. YANSON AND RICARDO B. YANSON

G.R. No. 101847 May 27, 1993

FACTS

Private respondent Olivia V. Yanson filed a complaint against petitioner Lourdes Navarro for "Delivery of Personal Properties With Damages". The complaint incorporated an application for a writ of replevin. This was subsequently amended to include private respondent's husband, Ricardo B. Yanson, as co-plaintiff, and petitioner's husband, as co-defendant. The then Executive Judge Oscar R. Victoriano approved private respondents' application for a writ of replevin. Petitioner received a copy of the decision on January and filed a "Motion for Extension of Time To File a Motion for Reconsideration". This was granted with the private respondent’s opposition.

The trial court issued a writ of execution declared that the writ was "duly served and satisfied". Petitioners filed with respondent court a petition for annulment of the trial court's decision, claiming that the trial judge erred in declaring the non-existence of a partnership, contrary to the evidence on record. The appellate court, as aforesaid, outrightly dismissed the petition.

In the petition before the SC, petitioners claim that the trial judge ignored evidence that would show that the parties clearly intended to form, and actually formed a verbal partnership engaged in the business of Air Freight Service Agency in Bacolod and that the decision sustaining the writ of replevin is void since the properties belonging to the partnership do not actually belong to any of the parties until the final disposition and winding up of the partnership.

ISSUE

1.       Whether there was a partnership that existed between the parties based on their verbal contention

2.       Whether the properties that were commonly used in the operation of Allied Air Freight belonged to the alleged partnership business

RULING

The decision in this case has become final. Moreover, the petition is focused solely on factual issues which can no longer be entertained. However, the Court resolved the issues that are being pressed by the petitioners.

1.       There was no partnership that existed. As a premise, Article 1767 of the New Civil Code provides that, “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 proceeds among themselves.”

In consideration of the above, it is undeniable that both the plaintiff and the defendant-wife made admission to have entered into an agreement of operating this Allied Air Freight Agency of which the plaintiff personally constituted in a sense that the plaintiff did supply the necessary equipments and money. It was also admitted that part of this agreement was an equal sharing of whatever proceeds realized. A cursory examination of the evidences presented no proof that a partnership, whether oral or written had been constituted at the inception of this transaction. True it is that even up to the filing of this complaint those movables brought by the plaintiff for the use in the operation of the business remain registered in her name. While there may have been co-ownership or co-possession of some items and/or any sharing of proceeds by way of advances received by both plaintiff and the defendant, these are not indicative and supportive of the existence of any partnership between them. Article 1769 of the New Civil Code is explicit.

2.       No. In view of the above factual findings of the Court it follows inevitably therefore that there being no partnership that existed, any dissolution, liquidation or winding up is beside the point. As to the properties sought to be recovered, the Court sustains the possession by plaintiff of all equipments and chattels recovered by virtue of the Writ of Replevin. Considering the other vehicle which appeared registered in the name of the defendant, and to which even she admitted that part of the purchase price came from the business claimed mutually operated, although the Court have not as much considered all entries in the Audit Report as totally reliable to be sustained insofar as the operation of the business is concerned, nevertheless, with this admission of the defendant and the fact that as borne out in said Report there has been disbursed and paid for in this vehicle out of the business funds, it is only fitting and proper that validity of these disbursements must be sustained as true. In this connection and taking into account the earlier agreement that only profits were to be shared equally, the plaintiff must be reimbursed of this cost if only to allow the defendant continuous possession of the vehicle in question. It is a fundamental moral, moral and civil injunction that no one shall enrich himself at the expense of another.