BL2 ( own notes)

• Art 1828

  Dissolution - change of relation of partners causes by any partner ceasing associated in carrying business

  Winding up - process settling business or partnership affairs after dissolution

  Termination - all partnership affairs completely wound up and finally settled.
• Article 1829


  On dissolution the partnership is not terminated but continuous until winding up of partnership affairs is completed
• Dissolution


  The completion of the winding-up process, not the actual cessation of the partnership business
• Dissolution of a partnership must be distinguished from a mere suspension in the conduct of its business or operations
• Causes of dissolution

  • Without violation of the agreement between the partners:
  • - Termination of the definite term or particular undertaking specified in the agreement
  • - Express will of any partner, who must act in good faith, when no definite term or particular undertaking is specified
  • - Express will of all the partners who have not assigned their interests or suffered them to be charged for their separate debts, either before or after the termination of any specified term or particular undertaking
  • - Expulsion of any partner from the business bona fide in accordance with such a power conferred by the agreement between the partners
  • In contravention of the agreement between the partners, where the circumstances do not permit a dissolution under any other provision, by the express will of any partner at any time
  • Any event which makes it unlawful for the business of the partnership to be carried on or for the members to carry it on in partnership
• Dissolution in contravention of the agreement is applicable despite definite term or undertaking
• If a partner unjustly dissolves the partnership

  They may be liable for damages
• The agreement between partners must be unanimous for dissolution without violation
• Under 1830 cause of dissolution

  • Loss of specific things except it is loss after delivered. Remedy is contribute additional capital to save venture
  • Death of partner
  • Insolvency of partner/ partnership
  • Civil interdiction of any partner
• Article 1831

  On application court shall decree dissolution: (partner)

  • Declared insane
  • Incapacity
  • Misconduct and persistent breach of agreement
  • Business carried only at loss
  • Other circumstances
• Art 1832

  General Rule: unless otherwise stated, every partner is agent with authority to bind partnership as well other partner respect to transaction
• Article 1833

  Exception:

  • Dissolution BY ACT of any partner, partner acting for partnershil had no knowledge on dissolution
  • By DEATH or INSOLVENCY, partner acting for partnership had knowledge or notice
• Article 1835

  Dissolution of partnerships does not itself discharge existing liability of partner.
• Article 1836. Unless otherwise aggreed partners following had right to wind up partnership.

  • Partners designated by agreement
  • All partners not wrongfully dissolved partnership
  • Legal representative of last surviving partner not insolvent
• Right of partnership to application of partnership property on dissolution

  1. Without contravention of agreement:

  2. Partnership property applied to discharge Liabilities

  3. In surplus distribute to partner

  4. With contravention of agreement:

  5. Rights of partner not caused wrong are PP applied to liability, share in surplus, indemnified damages, continue business (same name- agreed term), posses PP

  6. Right of partner caused wrong:

  7. If not continued PP applied to discharge Liabilities and receive surplus cash less damages compensation

  8. If continued, have value of interest & released on existing & future liabilities of partnership
• Article 1838 partnership contract rescind (annulled) on ground of fraud or misrepresentation 


  Rights of injured partner. ( Filed on court)

  1. Right of lien or retention to surplus after satisfying partnership liability
  2. Right to subrogation partnership creditors payment of partnership liability
  3. To be indemnified by person guilty of fraud/ misrepresentation
• Article 1839. Rules apply in settling accounts between PARTNERS after dissolution.

  • Assets of partnership:

  • Order of application

  • Asset is sufficient required contribution,

  • Liability of deceased partner

  • Priority payment of partnership creditors/ partner creditor

  • Distribution of property of insolvent partner
• Article 1840 cases where creditors of dissolved partnership became creditor of continue business

  1. New partner is admitted or retires assign rights in PP to one or more partners ( w/o liquidation)
  2. One partner retire and assign PP to remain partner (businesses w/o liquidation.
  3. Any partner retires/dies but still continue business without assign of PP
  4. All partners/ repre assign right to PP on one or more partner
  5. any partner wrongfully cause dis. & Remain partner continue business w/o liquidation
  6. Partners is expelled and remain partner continue business w/o liquidation
• Article 1840: Rights of Retiring partner or legal representative of deceased partner when business is continued without settlement on his estate accounts:

  • Value of Interest of returning/deceased partner on date of dissolution

  • as a ordinary creditor, review equal amount of value on his share plus interest in dissolved part which
• Article 1842. After dissolution partners right to account of his interest against winding up at date of dissolution 


  Accrual rights- right to demand an accounting value of his interest after dissolution

  Person liable to render an account

  • Winding up partner
  • Surviving partner
  • Person/Partnership continuing business