Practice question
The firm receives a customer's property in the course of business. While it remains in partnership custody, one partner misapplies it. Management insists the firm is liable only if every partner was individually authorized to take the property. Which Article 1823 analysis is sound?
- Custody can never matter.
- The second category covers property received in the course of business and misapplied by a partner while in firm custody.
- All partners must personally sign the wrongful act.
- The client automatically becomes an industrial partner.
- The firm's receipt destroys all property rights.
Legal references
- Civil Code, Articles1786–1811 and1816–1824: https://lawphil.net/statutes/repacts/ra1949/ra_386_1949.html
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