Case Digest (G.R. No. L-26398)
Facts:
Elpidio Talastas sued Clemenco Abella for the dissolution and liquidation of an alleged oral partnership formed in September 1955 to operate a dance-hall/cabaret, the Sambat Recreation Center in Samal, Bataan, and to recover sums allegedly due from the partnership’s operations. Talastas alleged he contributed P1,546.54 and Abella P3,093.08, that Abella was the managing partner obligated to account monthly, failed to do so from February 1956, improperly operated a portion of the Center after ejecting a concessionaire, and kept proceeds and advances, including a P1,600 sum received from Juan Castillo for Talastas’s share; he prayed for accounting, delivery of shares, and damages.Abella denied the material allegations in his answer, asserting there was no partnership, and he opposed Talastas’s motion for summary judgment. The Court of First Instance of Manila granted summary judgment based on the pleadings and affidavits attached to Talastas’s motion; it awarded Talastas money an
Case Digest (G.R. No. L-26398)
Facts:
- Parties and procedural posture
- Plaintiff-appellee Elpidio Talastas sued defendant-appellant Clemenco Abella for liquidation of a partnership and recovery of several sums of money.
- The Court of First Instance of Manila rendered a summary judgment against the defendant.
- The defendant appealed to the Court of Appeals.
- The Court of Appeals certified the case to the Supreme Court under Sections 17 and 31 of Republic Act No. 296, as amended, because only questions of law were raised in the appeal.
- Plaintiff’s allegations in the complaint
- Plaintiff alleged that in September 1955, defendant and he entered into an oral contract of partnership to operate a dance-hall or cabaret known as Sambat Recreation Center (“the Center”) in Samal, Bataan.
- Plaintiff alleged capital contributions and profit sharing.
- Plaintiff contributed one-third (P1,546.54).
- Defendant contributed two-thirds (P3,093.08).
- Total partnership capital was P4,639.62.
- Profits were to be divided in the same proportion.
- Plaintiff alleged defendant’s managing partner obligations.
- Defendant was bound to render an accounting.
- Defendant was bound to deliver plaintiff’s share in the profits at the end of each month.
- Plaintiff alleged defendant’s failure to account and deliver shares.
- After rendering accounts for four (4) months, beginning February 1956, defendant failed and refused to render accounting or deliver plaintiff’s share in the profits.
- Plaintiff alleged the refreshment corner leasing and defendant’s diversion.
- A corner space in the Center building was leased to a refreshment concessionaire at P6.00 a night from September to December 1955.
- Defendant caused the concessionaire’s ejection and then operated his own refreshment business in the corner beginning January 1956.
- Plaintiff alleged taxi-dancer advances and non-remittance.
- In September 1955, the partnership hired taxi-dancers.
- The partnership lent the taxi-dancers advances totaling P327.00.
- One-third (plaintiff’s share) of the advances was P109.00.
- The taxi-dancers refunded P327.00 to defendant.
- Defendant failed and refused to deliver plaintiff’s share in earnings from the lease of the corner space and in the proceeds of the business operation.
- Defendant also failed and refused to render an accounting regarding these matters.
- Plaintiff’s prayers
- Dissolution and liquidation of the partnership.
- Ordering defendant to render accounts and deliver plaintiff’s share in:
- Monthly rentals received or due for the leased corner space.
- The taxi-dancer advance amounts already refunded.
- Earnings from operation of the Center as described.
- Payment of moral damages, attorney’s fees, and costs.
- Defendant’s answer and counterclaim
- Defendant filed an answer denying “the allegations contained” in plaintiff’s complaint.
- Defendant alleged that there was no oral contract of partnership between them.
- Defendant set up a counterclaim for attorney’s fees and moral damages.
- Plaintiff’s motion for summary judgment
- Plaintiff filed a motion for summary judgment on the ground that no genuine issue of fact had been raised.
- Plaintiff’s arguments supporting summary judgment
- Defendant’s answer was in the nature of a general denial, amounting to an admission of material averments.
- Defendant’s denial that there was an oral partnership was allegedly manifestly false, as shown by affidavits of Elpidio Talastas, Angel Bugay, Luningning Bugay, Marciano Medina, Vicente Tinao, and Juan Castillo, annexed to the motion.
- Plaintiff claimed he was in possession of indubitable documents establishing the partnership, though plaintiff stated they were too voluminous to attach to the motion and would be presented at the hearing.
- The trial court conducted a hearing “after due hearing” and granted the motion.
- The affidavits attached to plaintiff’s motion (material details)
- Affidavit of Elpidio Talastas
- Plaintiff stated that the partnership involved construction and operation of the Center.
- Plaintiff alleged that defendant and he entered into a partnership agreement where plaintiff, at his expense, constructed the first floor (including eaves and an “extension”) of defendant’s building in Samal, Bataan.
- Plaintiff alleged that the building had previously been used as a dance-hall or cabaret.
- Plaintiff alleged the costs of the construction.
- Materials and labor cost to plaintiff: P1,546.54.
- Defendant claimed to have spent P3,093.08 for the second floor.
- Plaintiff alleged the agreed partnership shares: one-third for plaintiff and two-thirds for defendant.
- Plaintiff reiterated the alleged failure to account and deliver profits starting February 1956.
- Plaintiff alleged that in July 1958, defendant sold plaintiff’s interest in the business for P1,600.00 to Juan Castillo.
- Plaintiff alleged that defendant offered to buy plaintiff’s share at P67.00 a month, but plaintiff rejected the offer.
- Plaintiff alleged the taxi-dancer advances.
- The partnership lent taxi-dancers a total of P327.00.
- Taxi-dancers paid back the amount to defendant.
- Defendant failed to deliver plaintiff’s share of P109.00 from these loan-related proceeds.
- Plaintiff alleged the refreshment nook operations.
- Since January 1956, defendant occupied as lessee a nook of the Center that used to be let to a concessionaire at P6.00 a night or P180 a month.
- Defendant operated a refreshment store there.
- Defendant failed and refused, despite repeated demands, to give plaintiff his share of the rental proceeds.
- Affidavit of Angel Bugay
- Angel Bugay was described as the master carpenter engaged by plaintiff for the construction.
- Plaintiff supervised the construction at the outset and later had assistance from Luningning Bugay.
- Plaintiff paid for services and lumber ordered in his name or on his account.
- The construction described was treated as plaintiff’s capital contribution as partner in operating the Center.
- Affidavit of Luningning Bugay
- Luningning Bugay supervised the construction for a while and advanced some funds.
- Lumber was secured in plaintiff’s name.
- She stated that defendant regarded the construction as plaintiff’s contribution to the partnership.
- After completion, she served as ticket seller and as plaintiff’s representative in the Center.
- Tickets sold bore the names of the plaintiff and the defendant as owners of the business.
- Each night, defendant and/or Rodolfo Buan made an accounting, and the records were signed by defendant or Rodolfo Buan.
- She showed these records to plaintiff whenever plaintiff came.
- Affidavit of Marciano Medina
- Marciano Medina stated he had a lumber yard from which plaintiff obtained lumber worth P1,100.
- He stated that P180 remained unpaid.
- He said defendant told him the construction was plaintiff’s share in their business.
- He stated that in June or July 1958, he learned from defendant that defendant had sold plaintiff’s share to Juan Castillo.
- Affidavit of Vicente Tinao
- He worked in the Center from 1955 to 1957 as ticket seller and helper of Rodolfo Buan.
- Tickets bore the names of plaintiff and defendant as owners....(Subscriber-Only)
Issues:
- Whether defendant’s answer constituted a general denial under the Rules of Court
- Whether defendant’s answer, which denied “the allegations contained” and asserted that no oral partnership existed, should be treated as a general denial for purposes of admissions of material averments.
- Whether defendant’s denial was sufficiently specific, including whether defendant set forth the substance of matters relied upon to support the denial.
- Whether the existence of the partnership was properly established in a summary judgment
- Whether the general denial produced admissions of the complaint’s material allegations, including