Overview

When money or property is pooled and profits are to be shared, the law will treat the set-up as (a) a co-ownership (you co-own an asset and share its fruits), (b) a partnership/joint venture (you share profits from a business or undertaking), or (c) in some cases, an investment contract (which may trigger securities-law issues). Each label affects who you sue, what to demand, where to file, and what you must prove. This guide lays out everything you need to claim unpaid profits: legal bases, causes of action, evidence, pre-suit steps (including barangay conciliation), proper courts, remedies, defenses, prescription, and templates.

1) First Principles: What you are enforcing

A. Co-ownership (Civil Code, Arts. 484–501)

Co-owners share in the fruits (e.g., rent, harvests, sale proceeds) in proportion to their ideal shares, unless agreed otherwise.
A managing co-owner must account for fruits/expenses and cannot appropriate common profits.

B. Partnership / Joint Venture (Arts. 1767, 1806–1831)

Sharing in profits creates a presumption of partnership (unless the contribution was a mere loan or salary).
Partners owe fiduciary duties, must render true and full information and account for profits.
You may sue for accounting, dissolution, and liquidation, plus your share of net profits and damages.

C. Investment contract (Securities-type)

If funds were solicited from several persons with profit sharing where a promoter manages everything, the deal may be an investment contract. You can still sue for your unpaid share; the securities angle adds regulatory consequences for the promoter (useful leverage), but your civil money claim proceeds in regular courts unless a valid arbitration clause controls.

Practical test: If you co-own a thing (e.g., a condo unit, a farm) → co-ownership frame. If you co-operate for profits from a business/deal → partnership frame. If you paid in and the promoter runs it all → potentially an investment contract; still, you can press sum of money + accounting.

2) Core Claims You Can File

A. Sum of Money (Unpaid Profit Share) + Legal Interest

Direct action to collect your pro-rata profits/dividends/returns based on the agreement or default rules (proportionate to contribution).
Attach a computation and the documents showing net profits.

B. Accounting and Inspection of Books

Compel the managing co-owner/partner to open books, receipts, bank statements, leases, sales, and to explain expenses, withdrawals, and distributions.

C. Dissolution / Liquidation (if partnership or JV)

If relations have broken down or term/project is over: seek dissolution, winding up, and distribution of net assets.

D. Partition / Sale (if co-ownership)

If management is abusive and co-ownership is no longer workable: ask the court to partition or order sale and divide proceeds, with an accounting for past fruits.

E. Constructive Trust / Unjust Enrichment

Where a manager/diverter kept profits or diverted sales: sue for restitution under constructive trust and unjust enrichment, plus damages.

F. Ancillary / Interim Reliefs

Preliminary Attachment (Rule 57) if there is fraud or funds are being spirited away.
Preliminary Mandatory/Prohibitory Injunction for access to books or to stop further dissipation.
Receivership (in extreme cases) to hold and manage income-producing property pending suit.
Appointment of a Commissioner (Rule 32) to examine and compute profits.

Criminal overlay: If there was misappropriation, consider a separate complaint for estafa; but keep the civil suit focused on collection/accounting for speed.

3) Venue, Jurisdiction, and Pathways

A. Out-of-court steps (often mandatory)

Demand Letter (with computation & deadline).
Barangay Conciliation (Katarungang Pambarangay) if all parties are natural persons residing in the same city/municipality and the dispute is not among the law’s exclusions. Failure to undergo conciliation when required can cause dismissal.

B. Court filing

Small Claims (first-level court): for pure money claims up to the current threshold (nationwide). Fast, documentary, no lawyers required for appearance.
First-Level Courts (MTC/MeTC): ordinary civil actions for claims up to ₱2,000,000 (exclusive of interest/damages), including accounting if the money value fits.
Regional Trial Court (RTC): if the claim exceeds ₱2,000,000, or the action is for dissolution, partition, receivership, or reliefs beyond money claims.

C. Arbitration / ADR

If your agreement has an arbitration clause, courts will generally refer the dispute to arbitration on timely motion. You may still seek interim measures from courts.

4) What You Must Prove (and How)

A. The Agreement (or default rules)

Written MOA/term sheet; emails, chats, texts confirming profit sharing, contributions, and roles.
If unwritten, show conduct: pooling funds, common venture, periodic distributions in the past, admission messages.

B. Your Contribution and Share

Deposit slips, bank transfers, receipts, ledgers, cashier’s checks, e-wallet proofs.
Cap table/ownership schedule; for co-owned property: title, deed, or purchase papers showing shares.

C. Profits/Income and Withholding

Source documents: sales/lease contracts, rent ledgers, invoices/ORs, bank statements, POS reports.
Expense proofs; compare gross → expenses → net.
Prior distributions (to show pattern) and new non-payment.

D. Breach

Missed payouts, refusal to account, diversion of funds, unilateral changes.
Notices demanding accounting/payment and replies (or silence).

Organize exhibits by period (Month/Quarter/Year), with a reconciliation worksheet leading to the exact amount you claim (principal + legal interest).

5) Computation Basics

Determine Net Profits = Gross income – Allowable, documented expenses (avoid “mystery” cash outs).
Apply sharing ratio (contractual; otherwise by contribution).
Deduct any cash distributions already received.
Legal Interest: Typically 6% p.a. from judicial or extra-judicial demand until full payment.
Damages: Add moral/exemplary only with clear proof of bad faith; attorney’s fees when litigation was necessary.

6) Drafting the Complaint (or Small Claims Statement)

Parties: Name all managing co-owners/partners, any entity used (sole prop/partnership/corp), and indispensable parties with custody of funds. Causes of Action:

Cause 1 – Sum of Money (unpaid profit share + interest).
Cause 2 – Accounting (with prayer for inspection of books; commissioner).
Alternative/Additional: Dissolution & Winding Up (if partnership), or Partition (if co-ownership). Prayers for Relief:
Money judgment;
Order to render accounting & produce records;
Prelim attachment / injunction;
Damages & fees;
Other just reliefs.

Attachments: Agreement, proof of contribution, computation table, demands, supporting ledgers.

7) Typical Defenses (and how to counter)

“It’s a loan, not a profit share.” → Show profit-sharing language/conduct, prior distributions tied to profits, or manager’s admissions.
“No profits were made.” → Demand books; show gross receipts and undocumented expenses; ask for commissioner and adverse inference for missing records.
“You forfeited/withdrew.” → Refute with correspondence and continued participation.
“Distribution is discretionary.” → Even if timing is discretionary, duty to account is not; and distributions must follow the agreed formula after legitimate expenses.
Prescription. → See Section 10; for continuing trusts/partnerships, the clock often runs from dissolution or demand/refusal to account.

8) Evidence & Discovery Playbook

Subpoena duces tecum to banks, tenants, buyers, payment processors.
Rule 27–29 discovery: requests for production, admissions, depositions (including accountants/bookkeepers).
Digital evidence: export email/chat threads and get server/device authentication if needed.
Neutral accounting: Move for a court-appointed commissioner to examine ledgers and compute shares.

9) Special Situations

Heirs of a deceased co-owner/partner: They step into the decedent’s economic rights; if a partnership, it’s typically dissolved as to that partner, requiring winding up and settlement with the estate.
Entity vehicles: If profits flowed through a corporation, direct claims for unpaid “dividends” follow corporate and intra-corporate rules (RTC commercial court; derivative/specific performance).
Mixed assets: If the venture owns property, combine accounting with partition or sale if appropriate.
Securities angle: If mass-solicited and unregistered, note the regulatory violations in your demand (leverage) while pressing the civil claim for sum of money + accounting.

10) Prescription (Deadlines)

Written contract: 10 years from breach (often reckoned from demand/refusal to pay or due date of distribution).
Oral contract / quasi-contract (unjust enrichment): 6 years.
Fraud: 4 years from discovery (for damages due to deceit).
Partnership accounting: tends to run from dissolution or unequivocal repudiation/refusal to account; ongoing, acknowledged partnerships often toll prescription until demand.
Constructive trust: generally 10 years from repudiation that is clearly made known to the beneficiary.

To be safe: send a dated demand (stops interest clock in your favor), then file without delay.

11) Remedies Matrix (quick view)

Scenario	Primary Action	Add-ons
Profits withheld; books hidden	Sum of money + Accounting	Injunction for access; Commissioner
Venture hopeless / relations broken	Dissolution & Winding Up (or Partition)	Receiver (extreme)
Manager diverting sales to his entity	Sum of Money + Constructive Trust	Attachment, Estafa complaint (parallel)
Small amount, fast relief	Small Claims	—

12) Barangay & Settlement Notes

Mandatory conciliation applies to natural persons in the same city/municipality (unless an exception). If a corporation/partnership is a party, KP usually does not apply.
Settlement agreement at barangay level is enforceable as a final judgment if approved.

13) Costs, Interest, and Fees

Filing fees scale with your money claim.
Legal interest (commonly 6% p.a.) from demand or filing until full satisfaction.
Attorney’s fees may be awarded when you were compelled to litigate.
Commissioner’s fees/audits can be charged as costs against the party who withheld books or acted in bad faith.

14) Clean, Actionable Checklist

Identify the frame: co-ownership vs partnership/JV (or corporate).
Gather documents: agreement, proof of contribution, income/expense records, prior distributions, communications.
Compute: net profits → your percentage → less paid → claim amount + 6% interest.
Send demand (give 7–10 banking days; request accounting & book access).
Barangay (if required).
Choose forum: Small Claims / MTC / RTC; check arbitration clause.
File: Sum of Money + Accounting (and, if needed, Dissolution/Partition). Add interim remedies.
Press discovery: subpoenas to banks/tenants, commissioner for audit.
Pursue judgment; enforce by levy/garnishment.

15) Mini-Templates (you can adapt)

A. Demand for Profit Share & Accounting

Subject: Demand for Payment of Profit Share and Accounting – [Project/Asset] Dear [Manager/Co-owner], Based on our agreement dated [date], my share is [__%]. For the period [Q1–Q4 20__], gross receipts are ₱[__] with documented expenses ₱[__], yielding net profits ₱[__]. My unpaid share is ₱[__]. Please remit within 10 banking days and provide complete accounting records (bank statements, invoices, leases, receipts). Legal interest (6% p.a.) applies from this demand. Absent compliance, I will file suit for sum of money, accounting, and remedies. Sincerely, [Name], [Address], [Contact]

B. Computation Sheet (attach)

Gross income: ₱___
Less: allowable expenses (attach list/receipts): ₱___
Net profits: ₱___
Your % share: % → ₱
Less: prior distributions: ₱___
Balance due: ₱___
Interest: 6% p.a. from [date]

Key Takeaways

Label matters: co-ownership → fruits & partition; partnership/JV → accounting, dissolution, liquidation; promoter-run schemes may add a securities dimension.
Your main suit is Sum of Money (profit share) + Accounting, with interim reliefs (attachment, injunction, commissioner).
Evidence wins cases: agreement (or conduct), contribution, income/expense records, and a clear computation.
Observe barangay conciliation, pick the right court, mind prescription, and demand interest.
Consider parallel criminal/regulatory routes if there is misappropriation—but keep the civil collection case laser-focused for speed.

If you’d like, I can turn this into a ready-to-file Small Claims pack (forms + demand letter + computation worksheet) or a full complaint template for an accounting and sum-of-money case.