Case Digest (G.R. No. 35840)
Facts:
Francisco Bastida v. Menzi & Co., Inc., G.R. No. L-35840. March 31, 1933, Supreme Court, Vickers, J., writing for the Court. Plaintiff-appellee Francisco Bastida sued defendants Menzi & Co., Inc., J. M. Menzi and P. C. Schlobohm (with Menzi & Co., Inc. as appellant) after a five‑year written agreement (Exhibit A, dated April 27, 1922) under which Bastida was to supervise manufacture of prepared fertilizers and receive 35% of net profits. Bastida alleged that the relationship was a partnership and that the defendants concealed and misallocated partnership funds and receipts (claims spanning undue interest charges, improper salary charges, payment of corporate income tax at the partnership’s expense, secret commissions, diversion of partnership merchandise and rebates, omission of a large contract in liquidation, and wrongful appropriation of goodwill and trademarks). He sought accounting, annulment of yearly balances, and monetary recovery on multiple causes of action.At the Court of First Instance of Manila the case was tried on amended pleadings and voluminous accounting evidence. The trial court concluded the contract was a regular commercial copartnership (relying on Article 116, Code of Commerce), found various items improperly charged to the partnership, allowed several of Bastida’s claims (including awards on the second, fourth, eighth and ninth causes of action), rejected others, and entered a large aggregate judgment against Menzi & Co., Inc., while dismissing the suit as to individual managers Menzi and Schlobohm on many counts. Menzi & Co., Inc. appealed.
The appeal brought the controversy to the Supreme Court. The Court reviewed the contract terms, contemporaneous conduct of the parties (payment history, monthly/annual balance sheets prepared by White, Page & Co., and Bastida’s approval and signatures on yearly statements), the corporate practice of departmental accounting (interest and overhead debited to departments), the procurement and registration...(Subscriber-Only)
Issues:
- Was the contract evidenced by Exhibit A a contract of copartnership or an employment/service contract?
- Were the contested accounting charges (interest on drafts and bank credits, proportionate salaries/overhead, and income taxes) improper charges to the fertilizer department such that Bastida was entitled to the sums awarded by the trial court?
- Was Bastida entitled to a share of profits from the Tabacalera (Compania General de Tabacos de Filipinas) contract taken by Menzi & Co., Inc.?
- Was Bastida entitled to 35% of the alleged ...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
- (Subscriber-Only)