G.R. No. 143340 - Sunga-Chan vs. Chua

In 1977, respondent Lamberto T. Chua and Jacinto L. Sunga verbally agreed to form a partnership to distribute Shellane LPG under the trade name SHELLITE GAS APPLIANCE CENTER, each contributing ₱100,000 and sharing profits equally.
Management arrangements: Jacinto as manager received 10% of gross profits; Josephine Sy assisted and received 10% of net profits plus wages; respondent supplied inventories and periodically received balance sheets, which he later suspected to be understated for tax avoidance.

Jacinto died in late 1989; his wife, petitioner Cecilia, and daughter, petitioner Lilibeth, assumed control of Shellite without respondent’s consent.
Despite respondent’s demands for accounting, inventory, appraisal, winding up and restitution of his partnership share, petitioners refused to comply; Lilibeth allegedly converted partnership assets to her own use.
On March 31, 1991, Lilibeth paid respondent ₱200,000 as partial settlement, promising full accounting and winding up, but never fulfilled this commitment.

June 22, 1992: respondent filed a complaint for winding up of partnership affairs, accounting, appraisal, recovery of shares and damages with preliminary attachment in the RTC of Sindangan, Zamboanga del Norte; petitioners moved to dismiss for lack of jurisdiction (SEC vs. RTC) and for probate jurisdiction, both denied.
Petitioners filed an answer with compulsory counterclaims; successive motions to dismiss and certiorari petitions to the CA (denied Nov. 15, 1994) and to the SC (denied Jan. 16, 1995); the case was remanded, and petitioners suspended pre-trial activities.
September 25, 1995 – January 17, 1996: pre-trial concluded; respondent presented evidence; petitioners waived the right to present evidence by non-attendance.
October 7, 1997: RTC rendered judgment in favor of respondent ordering accounting, restitution of assets, payment of partnership share and unreceived profits, damages and attorney’s fees.
October 28, 1997: petitioners appealed to the CA; January 31, 2000: CA affirmed; May 23, 2000: motion for reconsideration denied.
August 15, 2001: SC denied the Rule 45 petition and affirmed the CA decision.

Whether an oral partnership existed between respondent and Jacinto despite the absence of a written agreement.
Whether the Dead Man’s Statute (Sec. 23, Rule 130, Rules of Court) barred respondent’s and Josephine Sy’s testimony about pre-death transactions.
Whether laches or prescription extinguished respondent’s right to accounting and recovery of partnership interests.
Whether failure to register the partnership with the SEC invalidated the partnership.