You are on page 1of 2

Liability of partner for wrongful act or breach of trust (obligations of

the partners with regard to third persons)


ELMO MUASQUE vs. COURT OF APPEALS,CELESTINO
TROPICAL COMMERCIAL COMPANY and RAMON PONS

GALAN

G.R. No. L-39780 November 11, 1985


GUTTIERREZ, JR., J.:
FACTS: Petitioner Elmo Muasque in behalf of the partnership "Galan &Muasque",
as a Contractor, entered into a written contract with respondent Tropical for
remodeling of its Cebu Branch building. A totalamount of P25,000 was to be paid
under the contract for the entireservices of the Contractor. The first payment
made by Tropical was in theform of a check for P7,000 in the name of petitioner.
Petitioner endorsedthe check in favor of Galan to enable the latter to deposit it in
the bankand pay for the materials and labor used. A misunderstanding
ensuedbetween Muasque and Galan which came to the knowledge of
Tropical,thus, the second check issued by the latter was drawn in the name of
"Galan and Associates" and was encashed by Galan. Meanwhile, the construction
continued through the sole efforts of petitioner, whichcaused him to borrow
money from a certain Mr. Espina. Two checks were subsequently given to
petitioner pursuant to a court order.Petitioner filed a complaint for payment of
sum of money anddamages against the respondents seeking to recover the
amountscovered by the two checks and the additional expenses that petitioner
incurred in the construction.
Ruling of Lower and Appellate Courts: Both the trial and appellate courts absolved
respondents from any liability and held petitioner together with Galan jointly liable
to intervenors Cebu Southern Hardware Company and Blue Diamond Glass Palace
for the credit that they extended to the partnership.
ISSUE: Whether or not Petitioner Muasque solidarily or jointly liable with
Respondent Galan to pay the credits of intervenors Blue Diamond Glass and Cebu
Southern Hardware.
HELD: Petitioner is solidarily liable with respondent Galan to pay thecredits of the
two intervenors. Therefore, petitioner may recover fromrespondent Galan any
amount that he pays, in his capacity as a partner,to the above intervenors. Art.
1816 should be construed together with Article 1824 whichprovides that: "All
partners are liable solidarily with the partnership for everything chargeable to the
partnership under Articles 1822 and 1823".The obligation is solidary because the
law protects him, who in good faithrelied upon the authority of a partner, whether
such authority is real or apparent. That is why under Article 1824 of the Civil Code
all partners,whether innocent or guilty, as well as the legal entity which is
thepartnership, are solidarily liable.In this case, Tropical, Blue Diamond and Cebu
Hardware hadevery reason to believe that partnership existed between petitioner
andGalan, thus, it is fair that consequences of any wrongful act committed byany

of the partners therein should be answered solidarily by all thepartners and the
partnership as a whole. As between petitioner Muasque and Galan, justice so
dictatesthat Muasque be reimbursed by Galan for the payments made by
theformer as it was satisfactorily established that Galan acted in bad faith inhis
dealings with Munasque as a partner.

You might also like