San Beda College Alabang Corporation Law – Atty. M.I.P.

Romero
Articles of Incorporation: Binding effect of amendment
Philippine Trust Co. Whether a resolution releasing the shareholders from their obligation to pay 50% of their
vs. River respective subscription is valid. No.
1923
It is an attempted withdrawal of so much capital from the fund upon which the
company’s creditors were entitled ultimately to rely, and having been effected without
compliance with the statutory requirements, was wholly ineffectual. A corporation has no
power to release an original subscriber to its capital stock from the obligation of paying
his shares, without a valuable consideration. For such release; and as against creditors a
reduction of the capital stock can take place only in the manner and under the conditions
prescribed by law.
Marcus vs. RH Macy Whether or not Marcus may exercise her right of appraisal.
1947
Vesting voting rights to the preferred shares, in the case of R.H. Macy, resulted to the
increase in aggregate number of shares with voting rights which in effect diminished the
potential worth of the common shares as a factor in the management of the corporation's
affairs
Iglesia Evangelica vs. Whether the corporation sole may be converted into a corporation aggregate by mere
Bishop Lazaro amendment of its articles of incorporation. Yes
2010
True, the Corporation Code provides no specific mechanism for amending the articles of
incorporation of a corporation sole. But, as the RTC correctly held, Section 109 of the
Corporation Code allows the application to religious corporations of the general provisions
governing non-stock corporations.

Citizenship Requirements
Gamboa vs. Teves Whether or not the term "capital" in Section 11, Article XII of the Constitution has long
2012 been settled and defined to refer to the total outstanding shares of stock, whether voting
or non-voting. No

The term “capital” in the Constitution refers only to shares of stock entitled to vote in the
election of directors, and thus in the present case only to common shares, and also
preferred shares that are entitled to vote and not the total outstanding capital stock
comprising both common and non-voting preferred shares.

Narra Nickel Mining Whether the FIA admits of the application of Grandfather Rule. Yes
vs. Redmont
2014 The “control test” is still the prevailing mode of determining whether the ambit of Section
2, Article Ii of the 1987 Constitution, entitled to undertake the exploration, development
and utilization of the natural resources of the Philippines. When in the mind of the Court
there is doubt, based on the attendant facts and circumstances of the case, in the 60-40
Filipino-equity ownership in the corporation, then it may apply the “grandfather rule”
Roman Catholic Whether a corporation sole named Roman Catholic is qualified to acquire private
Apostolic vs. agricultural lands in the Philippines. No
Register of Deeds of
Davao City A corporation sole being a creature prior to the constitution, has no nationality. If a
1957 nationality is sought to be determined, the same depends of the nationality of the
majority of the lay members and not on the nationality of the sole corporator.
Residence of corporation
Young Auto Supply Whether a personal action filed by a corporation in the place of its residence stated in
Co vs. CA AOI is proper although its address stated in the Deed of Sale and commercial transactions
1993 is the place of its branch office. Yes

A corporation has no residence in the same sense which this term is applied to a natural
person. But for practical purposes, a corporation is in a metaphysical sense a resident of
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the place where its principal office is located as stated in its AOI. A corporation cannot be
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allowed to file personal actions in a place other than its principal place of business unless

Narvasa, J.
 San Beda College Alabang Corporation Law – Atty. M.I.P. Romero
such a place is also the residence of a co-plaintiff or a defendant.
Name of Corporation
Republic Planters Whether the change of corporate name extinguishes the personality of the original
Bank vs. CA corporation.
1992
Amendment in articles of incorporation changing its corporate name does not extinguish
the personality of the original corporation. The corporation upon such change of its
name, is in no sense a new entity, nor the successor of the original corporation. It is the
same corporation with a different name, and its character is in no respect changed.
Consequently, the “new” corporation is still liable for the debts and obligations of the “old
corporation"
Philips Export B.V. vs. Whether the use of the word PHILIPS by respondent infringes petitioner’s right.
CA
1992 The Statutory prohibition cannot be any clearer. To come within its scope, the 2
requisites must be proven, namely:
1. That the complainant corporation acquired a prior right over the use of such
corporate name; and
2. The proposed name is either:
 Identical or
 Deceptively or confusingly similar to that of any existing corporation or to
any other name already protected by law; or
 Patently deceptive, confusing or contrary to existing law.

Lyceum of the Doctrine of secondary meaning “xxx a word or phrase originally incapable of exclusive
Philippines vs. CA appropriation with reference to an article on the market, because geographically or
1993 otherwise descriptive, might nevertheless have been used so long and so exclusively by
one producer with reference to his article that, in that trade and to that branch of the
purchasing public, the word or phrase has come to mean that the article was his product.

The number alone of private respondents in the case at bar suggests strongly that
petitioner’s use of the word “Lyceum” has not been attended with the exclusivity essential
for applicability of the doctrine of secondary meaning.
Armco Steel Corp. vs.
SEC
1987 Armco Steel-Philippines, has not only an identical name but also a similar line of business,
as shown above, as that of ARMCO STEEL-OHIO. People who are buying and using
products bearing the trademark ‘Armco’ might be led to believe that such products are
manufactured by the respondent, when in fact, they might have actually be produced by
the petitioners. Thus, the goodwill that should grow and inure to the benefit of petitioners
could be impaired and prejudiced by the continued use of the same term by the
respondent.
P.C. Javier & Sons, A change in corporate name does not make a new corporation, whether effected by a
Inc. vs. CA special act or under a general law. It has no effect on identity of corporation, or on its
2005 property, rights, or liabilities. The corporation, upon such change in its name is in no
sense a new corporation, nor the successor of the original corporation. It is the same
corporation with a different name, and its character is in no respect changed.
Consequently, the change in the name of the bank does not grant to its borrowers the
right to refuse to pay their loans on the ground that they have not been informed
formally of such change of name.
Industrial
Refractories Corp vs.
CA
2002
De Facto Corporation: requisites, powers, liabilities, validity
Pioneer Insurance vs. Where a person convinces other parties to invest money for the formation of a
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CA corporation, but which was never duly incorporated, there can be no resulting partnership
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1989 among them, and the mere passive investors cannot be held liable to share in the losses

Narvasa, J.
 San Beda College Alabang Corporation Law – Atty. M.I.P. Romero
suffered by the business enterprise
Municipality of
Malabang vs. Benito
1969 In the cases where a de facto municipal corporation was recognized as such despite the
fact that the statute creating it was later invalidated, the decisions could fairly be made to
rest on the consideration that there was some other valid law giving corporate vitality to
the organization. Hence, in the case at bar, the mere fact that Balabagan was organized
at a time when the statute had not been invalidated cannot conceivably make it a de
facto corporation, as, independently of the Administrative Code provision in question,
there is no other valid statute to give color of authority to its creation.
Cagayan Fishing vs. Although there is a presumption that all the requirements of law have been complied
Sandiko with, in the case before us it cannot be denied that the plaintiff was not yet incorporated
1937 when it entered into the contract of sale. The contract itself referred to the plaintiff as
“una sociedad en vias de incorporacion.” It was not even a de facto corporation at the
time.Not being in legal existence then, it did not possess juridical capacity to enter into
the contract.
Harill vs. Davis
1909
Corporation by Estoppel
Asia Banking Corp. In the absence of fraud, a person who has contracted or dealt with an association in such
vs. Std. Products Co. a way as to recognize and in effect admit its legal existence as a corporate body is
1924 thereby estopped to deny its corporate existence in an action leading out of or involving
such contract or dealing, unless the existence is attacked for causes which have arisen
since making the contract or other dealing relied on as an estoppel.
Cranson vs. IBM Corp Whether a defectively incorporated association would warrant a charge against officers in
1964 their personal capacity.

IBM, having dealt with the Bureau as if it were a corporation and relied on its credit
rather than that of Cranson, is estopped to assert that the Bureau was not incorporated
at the time the typewriters were franchised. Where one has recognized the corporate
existence of an association, he is estopped to assert the contrary with respect to claim
arising out of such dealings.
Salvatierra vs.
Garlitos
1958 While as a general rule, a person who deals with an association in such a way to
recognize its existence as a corporate body is estopped from denying the same in an
action arising out of such transaction, yet this doctrine may not be held to be applicable
where fraud takes a part in the said transaction. In the instant case, on plaintiff’s charge
that she was unaware of the fact that the defendant corporation had no juridical
personality, its president gave no confirmation or denial of the same and the
circumstance surrounding the execution of the contract lead to the inescapable
conclusion that plaintiff was really made to believe that such corporation was duly
organized in accordance with law.
Albert vs. University One who has induced another to act upon his willful misrepresentation that a corporation
Publishing Co., Inc. was duly organized and existing under the law, cannot thereafter set up against his victim
the principle of corporation by estoppel.
Chiang Kai Shek There should also be no question that having contracted with the private respondent
School vs. CA every year for 32 years and thus represented itself as possessed of juridical personality to
1989 do so, the petitioner is now estopped from denying such personality to defeat her claim
against it. According to Article 1431 of the Civil Code, “through estoppel an admission or
representation is rendered conclusive upon the person making it and cannot be denied or
disproved as against the person relying on it.”
Lim Tong Lim vs. Phil. It is difficult to disagree with the RTC and the CA that Lim, Chua and Yao decided to form
Fishing Gear a corporation. Although it was never legally formed for unknown reason, this fact alone
does not preclude the liabilities of the 3 as contracting parties in representation of it.
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Clearly under the law on estoppel, those acting on behalf of a corporation and those
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benefited by it, knowing it to be without valid existence, are held liable as general

Narvasa, J.
 San Beda College Alabang Corporation Law – Atty. M.I.P. Romero
partners
International Express The doctrine of corporation by estoppel is mistakenly applied by the respondent court to
Travel vs. CA the petitioner. The application of the doctrine applies to a 3 rd party only when he tries to
2000 escape liability on a contract from which he has benefited on the irrelevant ground of
defective corporation. In the case at bar, the petitioner is not trying to escape liability
from the contract but rather is the one claiming from the contract.
PAZ vs. New
International
Environmental Section 21 of the Corporation Code explicitly provides that one who assumes an
Universality, Inc. obligation to an ostensible corporation, as such, cannot resist performance thereof on the
2015 ground that there was in fact no corporation. Clearly, petitioner is bound by his obligation
under the MOA not only on estoppel but by express provision of law. As aptly raised by
respondent in its Comment to the instant petition, it is futile to insist that petitioner
issued the receipts for rental payments in respondent’s name and not with Capt. Clarke’s
whom petitioner allegedly contracted in the latter’s personal capacity, only because it was
upon the instruction of an employee. Indeed, it is disputably presumed that a person
takes ordinary care of his concerns, and that all private transactions have been fair and
regular. Hence, it is assumed that petitioner who is a pilot, knew what he was doing with
respect to his business with respondent.

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Narvasa, J.