Summary
Highlights
Further classifications include: a managing partner (manages the business), a liquidating partner (handles winding up after dissolution), a nominal partner (not a true partner but liable to third parties as one, e.g., partner by estoppel), an ostensible partner (active and publicly known), a secret partner (active but unknown to the public), a silent partner (involved in profits/losses but not management, known to public), and a dormant partner (inactive and not publicly known).
Generally, a partnership contract can be oral or written. However, exceptions exist. If the capital is 3,000 pesos or more (money/property), the contract must be in a public instrument and registered with the SEC. Failure to do so still results in a valid partnership with juridical personality but affects business licensing and tax assessment.
If immovable property or real rights are contributed, irrespective of value, the contract must be in a public instrument with an inventory signed by parties and attached. Non-compliance renders the partnership contract void and it will not have juridical personality. For a limited partnership, a certificate signed under oath by partners and recorded with the SEC is required; failure results in it being considered a general partnership.
A partnership is composed of two or more persons, referred to as partners, who contribute money, property, or industry to a common fund with the intention of dividing profits. This video delves into the various classifications of partners based on liability, contribution, and other factors.
Partners are categorized by liability: a general partner is liable to the extent of their separate property after partnership assets are exhausted. A limited partner is only liable up to their capital contribution and cannot contribute services. A general limited partner is liable to third-party creditors as a general partner but can seek reimbursement from co-partners, as they are considered a limited partner among themselves.
Using an example of X, Y, and Z partners in XYZ Company Limited, where X is limited, Y is general, and Z is general limited, the video illustrates how liabilities are settled when partnership assets are insufficient. Creditors can collect from Y and Z (general and general limited partners), but Z can then seek reimbursement from Y because Z is considered a limited partner within the partnership.
Partners are also classified by their contribution: a capitalist partner contributes money or property, an industrial partner contributes services or industry, and a capitalist industrial partner contributes both money/property and services.