CA
G.R. No. 152392; May 26, 2005
FACTS:
Korean Airlines (KAL) is a corporation established and
registered in the Republic of South Korea and licensed to do
business in the Philippines. Its general manager in the Philippines is
Suk Kyoo Kim, while its appointed counsel was Atty. Mario Aguinaldo
and his law firm.
KAL, through appointed counsel, filed a complaint against
Expert Travel with the RTC for the collection of sum of money. The
verification and certification against forum shopping was signed by
the same appointed counsel, who indicated therein that he was the
resident agent and legal counsel of KAL and had caused the
preparation of the complaint. Expert Travel filed a motion to dismiss
the complaint on the ground that the appointed counsel was not
authorized to execute the verification and certificate of non-forum
shopping as required by the Rules of Court. KAL opposed the
motion, contending that he is a resident agent and was registered as
such with the SEC as required by the Corporation Code. He also
claimed that he had been authorized to file the complaint through a
resolution of the KAL Board of Directors approved during a special
meeting, wherein the board of directors conducted a special
teleconference which he attended. It was also averred that in the
same teleconference, the board of directors approved a resolution
authorizing him to execute the certificate of non-forum shopping and
to file the complaint. Suk Kyoo Kim alleged, however, that the
corporation had no written copy of the aforesaid resolution. TC
denied motion to dismiss. CA affirms.
ISSUE:
Can a special teleconference be recognized as legitimate
means to approved a board resolution and authorize an agent to
execute an act in favor of the corporation?
HELD:
YES. In this age of modern technology, the courts may
take judicial notice that business transactions may be made by
individuals through teleconferencing. teleconferencing and
videoconferencing of members of board of directors of private
corporations is a reality, in light of Republic Act No. 8792. The
Securities and Exchange Commission issued SEC Memorandum
Circular No. 15, on November 30, 2001, providing the guidelines to
be complied with related to such conferences.
HOWEVER, in the case at bar, even given the possibility
that Atty. Aguinaldo and Suk Kyoo Kim participated in a
teleconference along with the respondents Board of Directors, the
Court is not convinced that one was conducted; even if there had
been one, the Court is not inclined to believe that a board resolution
was duly passed specifically authorizing Atty. Aguinaldo to file the
complaint and execute the required certification against forum
shopping. Facts and circumstances show that there was gross
failure
http://www.lawphil.net/judjuris/juri2005/may2005/gr_152392_2005.ht
ml - fnt24on the part of company to prove that there was indeed a
special teleconference such as failure to produce a written copy of
the board resolution via teleconference.
NOTE: Read SEC Memo Circular No. 15-2001, the guidelines for
the conduct of teleconferencing and videoconferencing.
Boyer-Roxas vs. CA
G.R. No. 100866; July 14, 1992
FACTS:
The corporation, Heirs of Eugenia Roxas Inc, was
established to engage in agriculture to develop the properties
inherited from Eugenia Roxas and Eufroncio Roxas, which includes
the land upon which the Hidden Valley Springs Resort was put up,
including various improvements thereon, using corporate funds. The
AOI of Heirs Inc. was amended for this purpose. Heirs Inc. claims
that Boyer-Roxas and Guillermo Roxas had been in possession of
the various properties and improvements in the resort and only upon
the tolerance of the corporation. It was alleged that they committed
acts that impeded the corporations expansion and normal operation
of the resort. They also did not comply with court and regulatory
orders, and thus the corporation adopted a resolution authorizing the
ejectment of the defendants. TC grants. CA affirms. Boyer and
Roxas contend that, being stockholders, their possession of the
properties of the corporation must be respected in view of their
ownership of an aliquot portion of all properties of the corporation.
ISSUE:
WON the possession of the properties in question must be
respected in view of being a stockholder.
HELD:
NO. Regarding properties owned by the corporation,
under the doctrine of corporate entity properties registered in the
name of the corporation are owned by it as an entity separate and
distinct from its members. While shares of stock constitute personal
property, they do not represent property of the corporation. A share
only for the unexpired term of the his predecessor in office. The
law has authorized the remaining members of the board to fill in a
vacancy only in specified instances, so as not to retard or impair the
corporations operations; yet, in recognition of the stockholders right
to elect the members of the board, it limited the period during which
the successor shall serve only to the unexpired term of his
predecessor in office.
It also bears noting that the vacancy referred to in Section
29 contemplates a vacancy occurring within the directors term
of office. When a vacancy is created by the expiration of a term,
logically, there is no more unexpired term to speak of. Hence,
Section 29 declares that it shall be the corporations stockholders
who shall possess the authority to fill in a vacancy caused by the
expiration of a members term.
NOTE: The court distinguished term and tenure.
Term is the time during which the officer may claim to hold
the office as of right, and fixes the interval after which the several
incumbents shall succeed one another. The term of office is not
affected by the holdover. The term is fixed by statute and it does not
change simply because the office may have become vacant, nor
because the incumbent holds over in office beyond the end of the
term due to the fact that a successor has not been elected and has
failed to qualify.
Tenure represents the term during which the incumbent
actually holds office. The tenure may be shorter (or, in case of
holdover, longer) than the term for reasons within or beyond the
power of the incumbent.
September 4, 2009
FACTS:
Sec. 23. The board of directors or trustees. Unless otherwise provided in this Code, the corporate powers
of all corporations formed under this Code shall be exercised,
all business conducted and all property of such corporations
controlled and held by the board of directors or trustees to be
elected from among the holders of stocks, or where there is no
stock, from among the members of the corporation, who shall
hold office for 1 year until their successors are elected and
qualified.
1.
2.
NO
term time during which the officer may claim to hold the
office as of right
tenure
ISSUE:
WON the amended by-laws of SMC of disqualifying a
competitor (Interlocking director) from nomination or election to the
Board of Directors of SMC are valid and reasonable.
HELD:
YES. The Board members and officers of a corporation
who purport to act for and in behalf of the corporation, keep within
the lawful scope of their authority in so acting, and act in good faith,
do not become liable, civilly or otherwise, for the consequences of
their acts. Those acts are properly attributed to the corporation alone
and no personal liability is incurred. In this case, the board members
obviously wanted to get rid of Cosalan and acted with indecent haste
in removing him from his GM position. This shows strong indications
that the members of the board had illegally suspended and
dismissed him precisely because he was trying to rectify the financial
irregularities.
The Board members are also liable for damages under
Sec. 31 of the Corporation Code, which by virtue of Sec. 4 thereof,
makes it applicable in a supplementary manner to all corporations,
including those with special or individual charters so long as these
are not inconsistent therewith.
The Board members are also guilty of gross negligence
and bad faith in directing the affairs of the corporation in enacting the
said resolutions, and in doing so, acted beyond the scope of their
authority.
HELD:
Under US corporate law, corporations have the power to
make by-laws declaring a person employed in the service of a rival
company to be ineligible for the corporation's Board of Directors. ...
An amendment which renders ineligible, or if elected, subjects to
removal, a director if he be also a director in a corporation whose
business is in competition with or is antagonistic to the other
corporation is valid." This is based upon the principle that where the
director is so employed in the service of a rival company, he cannot
serve both, but must betray one or the other. Such an amendment
"advances the benefit of the corporation and is good." In the
Philippines, section 21 of the Corporation Law expressly provides
that a corporation may make by-laws for the qualifications of
directors. Thus, it has been held that an officer of a corporation
cannot engage in a business in direct competition with that of the
corporation where he is a director by utilizing information he has
received as such officer, under "the established law that a director or
officer of a corporation may not enter into a competing enterprise
which cripples or injures the business of the corporation of which he
is an officer or director.
It is also well established that corporate officers "are not
permitted to use their position of trust and confidence to further their
private interests." In a case where directors of a corporation
cancelled a contract of the corporation for exclusive sale of a foreign
firm's products, and after establishing a rival business, the directors
entered into a new contract themselves with the foreign firm for
exclusive sale of its products, the court held that equity would regard
the new contract as an offshoot of the old contract and, therefore, for
the benefit of the corporation, as a "faultless fiduciary may not reap
the fruits of his misconduct to the exclusion of his principal.