G.R. No. L-6912, March 30, 1912
JOSE ARGUELLES, plaintiff-appellant, vs. PEDRO SYYAP, SILVINO LIM and ANTONINO BABASA, as sheriff of the Province of Batangas, defendants-appellees.

FACTS

Plaintiff Jose Arguelles and defendant Pedro Syyap formed a partnership (“Arguelles and Syyap”) for a road construction contract, with Arguelles holding a one-third interest and Syyap two-thirds. The partnership acquired machinery and equipment for the project. Defendant Silvino Lim obtained a judgment against Syyap personally for a debt of P32,000. Upon Lim’s instruction, defendant Sheriff Antonino Babasa levied upon and sold at public auction the partnership’s machinery as if it were Syyap’s exclusive property to satisfy the judgment. Arguelles filed a complaint in his own name, seeking a declaration of his ownership share in the attached property, payment of his proportional share of its value from Lim, and damages from Lim and the Sheriff for the allegedly illegal attachment. Defendants Lim and Syyap filed a demurrer (motion to dismiss), arguing, among other grounds, that Arguelles “lacks the legal personality requisite for the prosecution of this action.” The trial court sustained the demurrer on this specific ground, holding that the action should have been brought by the partnership itself, not by Arguelles individually.

ISSUE

Whether the plaintiff, Jose Arguelles, as an individual partner, lacks the legal personality or capacity to sue in his own name to recover his share in partnership property wrongfully taken to satisfy a personal debt of his co-partner.

RULING

No. The trial court’s order sustaining the demurrer on the ground of plaintiff’s lack of legal personality is reversed.
The Supreme Court distinguished between lack of legal personality (or capacity to sue) and lack of cause of action (or right of action). Legal personality to sue pertains to the plaintiff’s status and capacity to be a party to a suit, which generally requires only the full possession of civil rights. The complaint contained no allegation that Arguelles lacked such civil rights. The question of whether the action should have been brought by the partnership entity, or whether Arguelles has a valid claim to the relief sought, pertains to his right of action or the merits of his cause of action, not to his fundamental capacity to sue. A demurrer based on “lack of personality” is improper when the defect, if any, is actually the plaintiff’s lack of a right to the relief demanded under the facts alleged. The demurrer was overruled, and defendants were given time to answer the complaint.