View full case

GREGORIO F. ORTEGA v. CA

FACTS:

The case involves the review of a decision made by the Court of Appeals, involving the Securities and Exchange Commission (SEC) in SEC AC 254. The law firm of ROSS, LAWRENCE, SELPH and CARRASCOSO was registered with the SEC but underwent changes in its name through subsequent amendments to the articles of partnership. Petitioner-appellant Joaquin L. Misa sent letters to the respondents-appellees informing them of his withdrawal and retirement from the firm. He also requested a meeting to discuss the liquidation of his interest in the partnership. As a result, the petitioner filed a petition with the SEC seeking dissolution and liquidation of the partnership. Initially, the SEC ruled that the petitioner's withdrawal did not dissolve the partnership. However, the SEC en banc reversed this decision, concluding that the withdrawal indeed dissolved the partnership. The case was then sent back to determine the rights and obligations of the parties. Both parties sought reconsideration of the decision, but their requests were denied. Consequently, the case was appealed to the Court of Appeals. While the case was pending, two partners of the law firm passed away, and new partners were admitted. This prompted the petitioner to renew his application for receivership. The Court of Appeals eventually affirmed the decision made by the SEC.

ISSUES:

  1. Whether the withdrawal of Attorney Joaquin L. Misa dissolved the partnership of "Bito, Misa & Lozada."

  2. Whether the appointment of a receiver is necessary to wind up the affairs of the dissolved partnership.

RULING:

  1. Yes, the withdrawal of Attorney Joaquin L. Misa dissolved the partnership of "Bito, Misa & Lozada." The Securities and Exchange Commission ruled that as a partnership at will, the law firm could be dissolved by any partner at any time, regardless of good faith or bad faith, since no partner can be forced to continue in the partnership against his will.

  2. The Court of Appeals did not provide a ruling on the appointment of a receiver to wind up the affairs of the dissolved partnership.

PRINCIPLES:

  • A partnership at will can be dissolved by any partner at any time, regardless of good faith or bad faith.

  • No partner can be forced to continue in the partnership against his will.