Topic: Right to Joint Venture by Deed of Assignment.
Principle:
In a Philippine Jurisprudence case, an agent's filing of a complaint against his principal for the
collection of a balance in his favor and his rendering of a final account of his operations result
in the termination of the agency relationship between them, allowing the agent to purchase
the property involved in the agency at a public auction to satisfy a judgment against the
principal.
JOSEFINA P. REALUBIT, Petitioner,
v. PROSENCIO D. JASO and EDEN G. JASO, Respondents.
FACTS:
Petitioner Josefina Realubit (Josefina) entered into a Joint Venture Agreement with Francis Eric
Amaury Biondo (Biondo), a French national, for the operation of an ice manufacturing business.
With Josefina as the industrial partner and Biondo as the capitalist partner, the parties agreed
that they would each receive 40% of the net profit, with the remaining 20% to be used for the
payment of the ice making machine which was purchased for the business. For and in
consideration of the sum of 500,000.00, however, Biondo subsequently executed a Deed ₱of
Assignment, transferring all his rights and interests in the business in favor of respondent Eden
Jaso (Eden), the wife of respondent Prosencio Jaso. With Biondo’s eventual departure from the
country, the Spouses Jaso caused their lawyer to send Josefina a letter, apprising her of their
acquisition of said Frenchman’s share in the business and formally demanding an accounting
and inventory thereof as well as the remittance of their portion of its profits. Faulting Josefina
with unjustified failure to heed their demand, the Spouses Jaso commenced the instant suit
with the filing of their Complaint against Josefina, her husband, Ike Realubit (Ike), and their
alleged dummies, for specific performance, accounting, examination, audit and inventory of
assets and properties, dissolution of the joint venture, appointment of a receiver and damages.
Said complaint alleged, among other matters, that the Spouses Realubit had no gainful
occupation or business prior to their joint venture with Biondo; that with the income of the
business which earned not less than 3,000.00 per day, they were, however, able to acquire the
two-storey building as well ₱as the land on which the joint venture’s ice plant stands, another
building which they used as their office and/or residence and six (6) delivery vans; and, that
aside from appropriating for themselves the income of the business, the Spouses Realubit
have fraudulently concealed the funds and assets thereof thru their relatives, associates or
dummies.
ISSUE:
Whether or not respondents Spouses Jaso have any right in the joint venture?
Ruling: (YES)
Generally understood to mean an organization formed for some temporary purpose, a joint
venture is likened to a particular partnership or one which "has for its object determinate
things, their use or fruits, or a specific undertaking, or the exercise of a profession or
vocation." The rule is settled that joint ventures are governed by the law on partnerships which
are, in turn, based on mutual agency or delectus personae. Insofar as a partner’s conveyance
of the entirety of his interest in the partnership is concerned, Article 1813 of the Civil Code
provides as follows: Art. 1813. A conveyance by a partner of his whole interest in the
partnership does not itself dissolve the partnership, or, as against the other partners in the
absence of agreement, entitle the assignee, during the continuance of the partnership, to
interfere in the management or administration of the partnership business or affairs, or to
require any information or account of partnership transactions, or to inspect the partnership
books; but it merely entitles the assignee to receive in accordance with his contracts the
profits to which the assigning partners would otherwise be entitled. However, in case of fraud
in the management of the partnership, the assignee may avail himself of the usual remedies.
In the case of a dissolution of the partnership, the assignee is entitled to receive his assignor’s
interest and may require an account from the date only of the last account agreed to by all the
partners. From the foregoing provision, it is evident that "the transfer by a partner of his
partnership interest does not make the assignee of such interest a partner of the firm, nor
entitle the assignee to interfere in the management of the partnership business or to receive
anything except the assignee’s profits. The assignment does not purport to transfer an interest
in the partnership, but only a future contingent right to a portion of the ultimate residue as the
assignor may become entitled to receive by virtue of his proportionate interest in the capital."
Since a partner’s interest in the partnership includes his share in the profits, we find that the
CA committed no reversible error in ruling that the Spouses Jaso are entitled to Biondo’s share
in the profits, despite Juanita’s lack of consent to the assignment of said Frenchman’s interest
in the joint venture. Although Eden did not, moreover, become a partner as a consequence of
the assignment and/or acquire the right to require an accounting of the partnership business,
the CA correctly granted her prayer for dissolution of the joint venture conformably with the
right granted to the purchaser of a partner’s interest under Article 1831 of the Civil Code.
G.R. No. 178782 September 21, 2011
JOSEFINA P. REALUBIT, Petitioner, vs. PROSENCIO D. JASO and EDEN G. JASO,
Respondents.
DECISION PEREZ, J.:
The validity as well as the consequences of an assignment of rights in a joint venture are at
issue in this petition for review filed pursuant to Rule 45 of the 1997 Rules of Civil Procedure,1
assailing the 30 April 2007 Decision2 rendered by the Court of Appeals’ (CA) then Twelfth
Division in CA-G.R. CV No. 73861,3 the dispositive portion of which states:
WHEREFORE, the Decision appealed from is SET ASIDE and we order the dissolution of the joint
venture between defendant-appellant Josefina Realubit and Francis Eric Amaury Biondo and
the subsequent conduct of accounting, liquidation of assets and division of shares of the joint
venture business.
Let a copy hereof and the records of the case be remanded to the trial court for appropriate
proceedings.4
The Facts:
On 17 March 1994, petitioner Josefina Realubit (Josefina) entered into a Joint Venture
Agreement with Francis Eric Amaury Biondo (Biondo), a French national, for the operation of an
ice manufacturing business. With Josefina as the industrial partner and Biondo as the capitalist
partner, the parties agreed that they would each receive 40% of the net profit, with the
remaining 20% to be used for the payment of the ice making machine which was purchased
for the business.5 For and in consideration of the sum of ₱500,000.00, however, Biondo
subsequently executed a Deed of Assignment dated 27 June 1997, transferring all his rights
and interests in the business in favor of respondent Eden Jaso (Eden), the wife of respondent
Prosencio Jaso.6 With Biondo’s eventual departure from the country, the Spouses Jaso caused
their lawyer to send Josefina a letter dated 19 February 1998, apprising her of their acquisition
of said Frenchman’s share in the business and formally demanding an accounting and
inventory thereof as well as the remittance of their portion of its profits.7
Faulting Josefina with unjustified failure to heed their demand, the Spouses Jaso commenced
the instant suit with the filing of their 3 August 1998 Complaint against Josefina, her husband,
Ike Realubit (Ike), and their alleged dummies, for specific performance, accounting,
examination, audit and inventory of assets and properties, dissolution of the joint venture,
appointment of a receiver and damages. Docketed as Civil Case No. 98-0331 before
respondent Branch 257 of the Regional Trial Court (RTC) of Parañaque City, said complaint
alleged, among other matters, that the Spouses Realubit had no gainful occupation or business
prior to their joint venture with Biondo; that with the income of the business which earned not
less than ₱3,000.00 per day, they were, however, able to acquire the two-storey building as
well as the land on which the joint venture’s ice plant stands, another building which they used
as their office and/or residence and six (6) delivery vans; and, that aside from appropriating for
themselves the income of the business, the Spouses Realubit have fraudulently concealed the
funds and assets thereof thru their relatives, associates or dummies.8
Served with summons, the Spouses Realubit filed their Answer dated 21 October 1998,
specifically denying the material allegations of the foregoing complaint. Claiming that they
have been engaged in the tube ice trading business under a single proprietorship even before
their dealings with Biondo, the Spouses Realubit, in turn, averred that their said business
partner had left the country in May 1997 and could not have executed the Deed of Assignment
which bears a signature markedly different from that which he affixed on their Joint Venture
Agreement; that they refused the Spouses Jaso’s demand in view of the dubious circumstances
surrounding their acquisition of Biondo’s share in the business which was established at Don
Antonio Heights, Commonwealth Avenue, Quezon City; that said business had already stopped
operations on 13 January 1996 when its plant shut down after its power supply was
disconnected by MERALCO for non-payment of utility bills; and, that it was their own tube ice
trading business which had been moved to 66-C Cenacle Drive, Sanville Subdivision, Project 6,
Quezon City that the Spouses Jaso mistook for the ice manufacturing business established in
partnership with Biondo.9
The issues thus joined and the mandatory pre-trial conference subsequently terminated, the
RTC went on to try the case on its merits and, thereafter, to render its Decision dated 17
September 2001, discounting the existence of sufficient evidence from which the income,
assets and the supposed dissolution of the joint venture can be adequately reckoned. Upon the
finding, however, that the Spouses Jaso had been nevertheless subrogated to Biondo’s rights
in the business in view of their valid acquisition of the latter’s share as capitalist partner,10 the
RTC disposed of the case in the following wise:
WHEREFORE, defendants are ordered to submit to plaintiffs a complete accounting and
inventory of the assets and liabilities of the joint venture from its inception to the present, to
allow plaintiffs access to the books and accounting records of the joint venture, to deliver to
plaintiffs their share in the profits, if any, and to pay the plaintiffs the amount of ₱20,000. for
moral damages. The claims for exemplary damages and attorney’s fees are denied for lack of
basis.11
On appeal before the CA, the foregoing decision was set aside in the herein assailed Decision
dated 30 April 2007, upon the following findings and conclusions: (a) the Spouses Jaso validly
acquired Biondo’s share in the business which had been transferred to and continued its
operations at 66-C Cenacle Drive, Sanville Subdivision, Project 6, Quezon City and not
dissolved as claimed by the Spouses Realubit; (b) absent showing of Josefina’s knowledge and
consent to the transfer of Biondo’s share, Eden cannot be considered as a partner in the
business, pursuant to Article 1813 of the Civil Code of the Philippines; (c) while entitled to
Biondo’s share in the profits of the business, Eden cannot, however, interfere with the
management of the partnership, require information or account of its transactions and inspect
its books; (d) the partnership should first be dissolved before Eden can seek an accounting of
its transactions and demand Biondo’s share in the business; and, (e) the evidence adduced
before the RTC do not support the award of moral damages in favor of the Spouses Jaso.12
The Spouses Realubit’s motion for reconsideration of the foregoing decision was denied for
lack of merit in the CA’s 28 June 2007 Resolution,13 hence, this petition.
The Issues
The Spouses Realubit urge the reversal of the assailed decision upon the negative of the
following issues, to wit:
A. WHETHER OR NOT THERE WAS A VALID ASSIGNMENT OF RIGHTS TO THE JOINT VENTURE.
B. WHETHER THE COURT MAY ORDER PETITIONER [JOSEFINA REALUBIT] AS PARTNER IN THE
JOINT VENTURE TO RENDER [A]N ACCOUNTING TO ONE WHO IS NOT A PARTNER IN SAID JOINT
VENTURE.
C. WHETHER PRIVATE RESPONDENTS [SPOUSES JASO] HAVE ANY RIGHT IN THE JOINT VENTURE
AND IN THE SEPARATE ICE BUSINESS OF PETITIONER[S].14
The Court’s Ruling
We find the petition bereft of merit.
The Spouses Realubit argue that, in upholding its validity, both the RTC and the CA inordinately
gave premium to the notarization of the 27 June 1997 Deed of Assignment executed by Biondo
in favor of the Spouses Jaso. Calling attention to the latter’s failure to present before the RTC
said assignor or, at the very least, the witnesses to said document, the Spouses Realubit
maintain that the testimony of Rolando Diaz, the Notary Public before whom the same was
acknowledged, did not suffice to establish its authenticity and/or validity. They insist that
notarization did not automatically and conclusively confer validity on said deed, since it is still
entirely possible that Biondo did not execute said deed or, for that matter, appear before said
notary public.15 The dearth of merit in the Spouses Realubit’s position is, however,
immediately evident from the settled rule that documents acknowledged before notaries
public are public documents which are admissible in evidence without necessity of preliminary
proof as to their authenticity and due execution.16
It cannot be gainsaid that, as a public document, the Deed of Assignment Biondo executed in
favor of Eden not only enjoys a presumption of regularity17 but is also considered prima facie
evidence of the facts therein stated.18 A party assailing the authenticity and due execution of
a notarized document is, consequently, required to present evidence that is clear, convincing
and more than merely preponderant.19 In view of the Spouses Realubit’s failure to discharge
this onus, we find that both the RTC and the CA correctly upheld the authenticity and validity
of said Deed of Assignment upon the combined strength of the above-discussed disputable
presumptions and the testimonies elicited from Eden20 and Notary Public Rolando Diaz.21 As
for the Spouses’ Realubit’s bare assertion that Biondo’s signature on the same document
appears to be forged, suffice it to say that, like fraud,22 forgery is never presumed and must
likewise be proved by clear and convincing evidence by the party alleging the same.23 Aside
from not being borne out by a comparison of Biondo’s signatures on the Joint Venture
Agreement24 and the Deed of Assignment,25 said forgery is, moreover debunked by Biondo’s
duly authenticated certification dated 17 November 1998, confirming the transfer of his
interest in the business in favor of Eden.26
Generally understood to mean an organization formed for some temporary purpose, a joint
venture is likened to a particular partnership or one which "has for its object determinate
things, their use or fruits, or a specific undertaking, or the exercise of a profession or
vocation."27 The rule is settled that joint ventures are governed by the law on partnerships28
which are, in turn, based on mutual agency or delectus personae.29 Insofar as a partner’s
conveyance of the entirety of his interest in the partnership is concerned, Article 1813 of the
Civil Code provides as follows:
Art. 1813. A conveyance by a partner of his whole interest in the partnership does not itself
dissolve the partnership, or, as against the other partners in the absence of agreement, entitle
the assignee, during the continuance of the partnership, to interfere in the management or
administration of the partnership business or affairs, or to require any information or account
of partnership transactions, or to inspect the partnership books; but it merely entitles the
assignee to receive in accordance with his contracts the profits to which the assigning partners
would otherwise be entitled. However, in case of fraud in the management of the partnership,
the assignee may avail himself of the usual remedies.
In the case of a dissolution of the partnership, the assignee is entitled to receive his assignor’s
interest and may require an account from the date only of the last account agreed to by all the
partners.
From the foregoing provision, it is evident that "(t)he transfer by a partner of his partnership
interest does not make the assignee of such interest a partner of the firm, nor entitle the
assignee to interfere in the management of the partnership business or to receive anything
except the assignee’s profits. The assignment does not purport to transfer an interest in the
partnership, but only a future contingent right to a portion of the ultimate residue as the
assignor may become entitled to receive by virtue of his proportionate interest in the
capital."30 Since a partner’s interest in the partnership includes his share in the profits,31 we
find that the CA committed no reversible error in ruling that the Spouses Jaso are entitled to
Biondo’s share in the profits, despite Juanita’s lack of consent to the assignment of said
Frenchman’s interest in the joint venture. Although Eden did not, moreover, become a partner
as a consequence of the assignment and/or acquire the right to require an accounting of the
partnership business, the CA correctly granted her prayer for dissolution of the joint venture
conformably with the right granted to the purchaser of a partner’s interest under Article 1831
of the Civil Code.32 1âwphi1
Considering that they involve questions of fact, neither are we inclined to hospitably entertain
the Spouses Realubit’s insistence on the supposed fact that Josefina’s joint venture with
Biondo had already been dissolved and that the ice manufacturing business at 66-C Cenacle
Drive, Sanville Subdivision, Project 6, Quezon City was merely a continuation of the same
business they previously operated under a single proprietorship. It is well-entrenched doctrine
that questions of fact are not proper subjects of appeal by certiorari under Rule 45 of the Rules
of Court as this mode of appeal is confined to questions of law.33 Upon the principle that this
Court is not a trier of facts, we are not duty bound to examine the evidence introduced by the
parties below to determine if the trial and the appellate courts correctly assessed and
evaluated the evidence on record.34 Absent showing that the factual findings complained of
are devoid of support by the evidence on record or the assailed judgment is based on
misapprehension of facts, the Court will limit itself to reviewing only errors of law.35
Based on the evidence on record, moreover, both the RTC36 and the CA37 ruled out the
dissolution of the joint venture and concluded that the ice manufacturing business at the
aforesaid address was the same one established by Juanita and Biondo. As a rule, findings of
fact of the CA are binding and conclusive upon this Court,38 and will not be reviewed or
disturbed on appeal39 unless the case falls under any of the following recognized exceptions:
(1) when the conclusion is a finding grounded entirely on speculation, surmises and
conjectures; (2) when the inference made is manifestly mistaken, absurd or impossible; (3)
where there is a grave abuse of discretion; (4) when the judgment is based on a
misapprehension of facts; (5) when the findings of fact are conflicting; (6) when the CA, in
making its findings, went beyond the issues of the case and the same is contrary to the
admissions of both appellant and appellee; (7) when the findings are contrary to those of the
trial court; (8) when the findings of fact are conclusions without citation of specific evidence on
which they are based; (9) when the facts set forth in the petition as well as in the petitioners'
main and reply briefs are not disputed by the respondents; and, (10) when the findings of fact
of the CA are premised on the supposed absence of evidence and contradicted by the
evidence on record.40 Unfortunately for the Spouses Realubit’s cause, not one of the foregoing
exceptions applies to the case.
WHEREFORE, the petition is DENIED for lack of merit and the assailed CA Decision dated 30
April 2007 is, accordingly, AFFIRMED in toto.
SO ORDERED.
JOSE PORTUGAL PEREZ
Associate Justice
