G.R. No. L-23232 June 17, 1970
VICENTE DIRA, plaintiff-appellant, vs. PABLO D. TAÑEGA, defendant-appellee.

FACTS

In March 1946, plaintiff Vicente Dira, defendant Pablo D. Tañega, and Francisco Pagulayan formed a partnership for a printing business with a term of five years. Dira was President (salary P150/month) and editor of the Leyte-Samar Tribune (salary P100/month), but Tañega, as Manager-Treasurer, never paid these salaries. The capital was P5,000 equally shared. Dira borrowed P1,100 from Pagulayan, pledging his partnership share as security. Tañega paid Pagulayan this amount on Dira’s request, with Dira’s share then pledged to Tañega. On June 3, 1946, Pagulayan sold his share to Tañega, making Tañega a 2/3 owner. On April 19, 1947, Tañega demanded Dira settle his debt; upon Dira’s failure, Tañega assumed full ownership, changed the business name to Tañega Press, moved its location, and exclusively operated it openly from 1947 onward without Dira’s participation or any accounting. Dira filed the action for accounting, payment of salaries, and other money claims only on February 10, 1961, nearly ten years after the partnership term expired in March 1951 and about fourteen years after Tañega’s exclusive takeover in 1947.

ISSUE

Whether the plaintiff’s causes of action for accounting, payment of salaries, and recovery of share in partnership assets are barred by prescription and laches.

RULING

Yes, the actions are barred by prescription. The Court affirmed the trial court’s dismissal.
1. Prescription of Actions: The claims for unpaid salaries accrued monthly and prescribed, as the suit was filed over ten years after they became due. The action for accounting prescribed under Article 1153 of the Civil Code, which runs from the day the person who should render it ceases functions—here, 1947 when Tañega took exclusive control—and the longest prescriptive period is ten years. The action to recover movables (printing equipment) prescribed in eight years under Article 1140, as Tañega’s adverse possession began in 1947.
2. Acquisitive Prescription: Under Article 1132, Tañega acquired ownership of Dira’s share by eight years of uninterrupted possession, completing prescription by 1955, six years before the suit.
3. No Imprescriptible Trust: Dira’s argument of a trusteeship making actions imprescriptible failed because Tañega’s open repudiation of the partnership in 1947 (changing name, location, operating exclusively) negated any continuing trust or co-ownership, and acquisitive prescription extinguished any such claim.
4. Laches: The Court noted laches also barred the claims due to Dira’s unreasonable delay (over nine years post-partnership term) in asserting rights, though it based its decision squarely on prescription. The judgment was affirmed with costs against appellant.