Paulino Acosta v. Nicolas Llacuna

Summary

Partnership dispute involving lumber business where Acosta contributed P3,000 capital and Arellano provided industry/management with P5 profit per cubic meter arrangement. Lower court treated the arrangement as a loan, but Supreme Court correctly identified it as civil partnership requiring proper liquidation before determining liabilities. The Court emphasized that partnership liquidation must occur to determine if capital loss resulted from legitimate business operations before holding surety liable. Case demonstrates importance of partnership liquidation procedures and proper characterization of business relationships under Civil Code provisions.