SESSION ONE

I. READING ASSIGNMENTS
1. Codal Section 2, Corporation Code
2. Textbook Villanueva, Chapters 1-3 (Chapter 3 up to Emerging Doctrine of CSR only)
3. SC Cases see outline below

II. LECTURE Chapter 20 (Legal Theory of Philippine Corporate Law)

III. GRADED RECITATION Chapters 1-3 (Textbook + Cases)

OUTLINE:
1. Introduction

2. Brief History of Philippine Corporate Law

- Sociedades Anonimas
- Cuentas en Participacion
- Act 1459
- BP Blg. 68

3. Statutory definition of the Corporation Sec. 2, Corporation Code (MEMORIZE!)

4. Theories on the Formation of a Corporation

- Theory of Concession (vis--vis Genossenschaft Theory)
o Tayag, GR L-23145, Nov. 29, 1968;
o Torres vs. CA - GR 120138, Sept. 5, 1997;
- Theory of Enterprise Entity

5. Tri-Level Existence in the Corporate Setting

6. Corporation as a Creature of the Law

- Constitutional provision Sec. 16, Art. XII
o National Devt Company vs. Phil Veterans, GR 84132-33, Dec. 10, 1990;
o Philippine Society vs. COA, GR 169752, Sept. 25, 2007;
o MIAA vs. City of Pasay, GR 163072, April 2, 2009;
o Boy Scouts of the Phils vs. COA, GR 177131, June 7, 2011;
o Liban vs. Gordon, GR 175352 (both DECISION penned by Justice
Antonio Carpio & RESOLUTION penned by Justice Teresita De Castro);
- Civil Code Provisions Art. 44 and 45
- Franchises of Corporations - J.R.S. Business Corp., GR L-19891, July 31, 1964;

7. Attributes of the Corporation

- Artificial Being - Vazquez vs. Borja, GR L-48930, Feb. 23, 1944;
- Creature of the Law
- Right of Succession
- Creature of Enumerated Powers, Attributes and Properties - Monfort Hermanos
Agricultural Devt. Corp., GR 152542, July 8, 2004;
8. Advantages of the Corporate Medium
- Strong juridical personality
- Centralized management
- Limited liability to investors
- Free transferability of units of investment
- Advantages over unregistered associations

9. Disadvantages of the Corporate Medium

- Complicated and costly formation and maintenance (no longer true!)
- Lack of personal element and abuse of corporate management
- Limited liability hits innocent victims
- Double taxation

10. Comparing the Corporation with other media of Business Endeavors

- Sole Proprietorships
- Partnerships
- Business Trusts
- Joint Ventures
- Cooperatives

11. Entitlement of the Corporation to Constitutional Guarantees

- Right to Due Process Smith, Bell & Company, GR 15574, Sept. 17, 1919;
- Right against Unreasonable Searches & Seizures, Stonehill vs. Diokno, GR L-19550, June
19, 1967;
- Right against Self-Incrimination, BASECO vs. PCGG, GR 75885, May 27, 1987;

12. Corporate Torts - PNB vs. CA, GR L-27155, May 18, 1978;

13. Corporate Negligence (Corporate Responsibility) PSI vs. Agana, GR 126297

- DECISION January 31, 2007;
- FIRST MR February 11, 2008;
- SECOND MR February 2, 2010;