Ternate v. Aniversario
REITERATIONFacts
The Antecedents: Florencio Ternate (plaintiff-appellee) and Maria Aniversario (defendant-appellant) entered into a contract of partnership on October 14, 1902, for the coastwise trade using the steamship Nuestra Señora de Gracia, of which they were sole owners. The partnership was dissolved by mutual consent on October 15, 1905, with Ternate selling his half-interest in the vessel to Aniversario. The parties were unable to amicably settle the partnership affairs, leading Ternate to file an action to recover a claimed balance due from Aniversario. Procedural History: The court below found that Ternate was entitled to recover a total of 3,572 pesos and 90 centavos, with interest. This amount comprised one-half of the losses suffered by the partnership between July 1, 1905, and October 15, 1905 (2,267 pesos and 31 centavos), 2% of the profits received by Aniversario (1,157 pesos and 59 centavos), and money advanced by Ternate (148 pesos). The Petition: The plaintiff sought to recover a balance claimed to be due from the defendant after the dissolution of their partnership. The Supreme Court reviewed the claims, particularly concerning the division of losses and the plaintiff's entitlement to a manager's commission.
Issue(s)
Whether the plaintiff is entitled to recover one-half of the losses incurred by the partnership from July 1, 1905, to October 15, 1905. Whether the plaintiff is entitled to recover a 2% commission on profits paid to the defendant during the partnership's existence. Whether the plaintiff is entitled to recover money advanced to the defendant and for money paid for masses.
Ruling
The Supreme Court modified the judgment of the court below. The plaintiff is entitled to recover 2,415 pesos and 31 centavos, with interest, instead of the original award of 3,572 pesos and 90 centavos. The case was remanded for entry of judgment.
Ratio Decidendi
On the entitlement to recover one-half of the losses: The court affirmed the decision of the lower court. The partnership agreement stipulated that losses were to be shared in proportion to the investments, which were equal. The plaintiff, as manager, had paid the debts of the company, represented by the losses during the period from July 1, 1905, to the dissolution. Therefore, the defendant was bound to pay the plaintiff one-half of these losses, amounting to 4,534 pesos and 62 centavos, which was equally divided between them. The court found the recovery for this item to be proper. On the entitlement to recover a 2% commission on profits: The court reversed the decision of the lower court regarding this claim. The partnership articles provided that the manager (plaintiff) would receive 2% of the profits for his services, to be deducted before profit distribution. However, the plaintiff, as manager, had consistently failed to deduct this commission in semi-annual balance sheets and profit settlements, many of which were signed by both parties. These settlements, agreed to in writing, did not include any charge for this commission. The plaintiff, having voluntarily made these statements with full knowledge and without explanation for the omission, was deemed to have renounced his claim to the commission. The court cited the principle of estoppel, as applied in Lucia et al. vs. Perez, where a party who approves accounts with full knowledge of the facts is estopped from later claiming the amount in controversy. Therefore, the plaintiff was not entitled to recover anything for this item. On the entitlement to recover money advanced and for masses: The court affirmed the decision of the lower court. The plaintiff claimed 148 pesos for money advanced in cash and for money paid for the saying of masses. The plaintiff presented evidence to support this claim, and the defendant offered no evidence to contradict it. In the absence of any evidence from the defendant, the court found the judgment of the lower court on this item to be proper and affirmed its recovery.
Main Doctrine
A partner who voluntarily, and with full knowledge of all the facts, makes repeated statements in writing as to the true condition of the business, and procures the other partner's signature thereto, cannot later claim these statements were incorrect without providing an explanation for any discrepancies, particularly regarding deductions not made at the time of settlement.