I. Contract of PartnershipPartnership –contract whereby two or morepersons bind themselves to contribute money,property or industry to a common fund with theintention of dividing the profits among themselves. Essential Elements:1. Agreement to contribute money, property orindustry to a common fund. (mutual contribution toa common stock)2. Intention to divide the profits among thecontracting parties.Requisites: - ICJ1. Intention to create a partnership2. Common fund obtained from contributions3. Joint interest in dividing the profitsCharacteristics:1. Bilateral – entered into by two or more personsand the rights and obligations arising therefrom arereciprocal.2. Onerous – each of the parties aspires to procurefor himself a benefit through the giving ofsomething.3. Nominate - it has a special name or designation inour law.4. Consensual – perfected by mere consent5. Commutative – the undertaking of each of thepartners is considered as the equivalent of that ofthe others.6. Principal – its life does not depend on theexistence of another contract.7. Preparatory – because it is entered into as ameans to an end.8. Fiduciary – it is based on trust and confidence.Delicts personae –the right to choose the persons to be associatedwith No one can be a member of the partnershipwithout the consent of the other members.Gives the partner power but not necessarily theright to dissolve the partnership in good faith.Rules to determine the existenceof a partnership1. Persons who are not partners as to each other arenot partners as to third person.Except – Partnership or partners by estoppelEstoppel in pais– by statement, silence oromissions. Estoppel by deed– in view of any documentLaches –by passage of timePartnership by estoppel1. When a person represents himself as a partner inan existing partnership. Partnership liability willarise.a. If all partner consent to such misrepresentationA partnership by estoppel is createdbetween the actual partners and the personwho made misrepresentationb. If not all partner consent to themisrepresentationThe person who made the misrepresentation isconsidered as partner by estoppel shall embody all the partners obligation butnot the rights of a partner2. When a person represent himself as a partner ina non-existing partnership. No partnership willariseThepersonwhomadethemisrepresentation and all persons whoconsented is liable.3. Co ownership or co possession does not by itselfestablish a partnershipWhether such co-owners or co-possessorsdo or do not share in profits made by theuse of propertyPrimary purpose: for enjoyment andpreservation of the property co-owned orco-possessed4. Sharing of gross returns does not of itselfestablish a partnership.