13.
HALL
v
PICCIO
ordered
in
a
quo
warranto
proceeding
instituted
in
accordance
with
section
19
of
the
Corporation
Law.
DOCTRINE:
PETITIONER:
C.
ARNOLD
HALL
AND
BRADLEY
HALL
(b)
Inasmuch
as
respondents
Fred
Brown
and
Emma
RESPONDENTS:
EDMUNDO
S.
PICCIO,
FRED
AND
Brown
had
signed
the
article
of
incorporation
but
only
EMMA
BROWN
a
partnership.
FACTS:
(1)
Petitioner
C.
Arnold
Hall
and
Bradley
P.
Hall,
and
ISSUE:
WON
had
jurisdiction
to
dissolve
the
de
facto
the
respondents
Fred
Brown,
Emma
Brown,
signed
corporation?
[NO]
and
acknowledged
in
Leyte,
the
article
of
incorporation
of
the
Far
Eastern
Lumber
and
Commercial
Co.,
Inc.,
organized
to
engage
in
a
COURT
RULING:
general
lumber
business
to
carry
on
as
general
contractors,
operators
and
managers,
etc.
Attached
to
Under
our
statue
it
is
to
be
noted
(Corporation
Law,
the
article
was
an
affidavit
of
the
treasurer
stating
sec.
11)
that
it
is
the
issuance
of
a
certificate
of
that
23,428
shares
of
stock
had
been
subscribed
and
incorporation
by
the
Director
of
the
Bureau
of
fully
paid
with
certain
properties
transferred
to
the
Commerce
and
Industry
which
calls
a
corporation
into
corporation
described
in
a
list
appended
thereto.
being.
The
immunity
if
collateral
attack
is
granted
to
corporations
"claiming
in
good
faith
to
be
a
(2)
Immediately
after
the
execution
of
said
articles
corporation
under
this
act."
Unless
there
has
been
of
incorporation,
the
corporation
proceeded
to
do
an
evident
attempt
to
comply
with
the
law
the
claim
to
business
with
the
adoption
of
by-‐laws
and
the
be
a
corporation
"under
this
act"
could
not
be
made
election
of
its
officers.
"in
good
faith
(3)
Said
articles
of
incorporation
were
filed
in
the
Section
19
reads
as
follows:
office
of
the
Securities
and
Exchange
Commissioner,
for
the
issuance
of
the
corresponding
certificate
of
“The
due
incorporation
of
any
corporations
claiming
incorporation.
in
good
faith
to
be
a
corporation
under
this
Act
and
its
right
to
exercise
corporate
powers
shall
not
be
(4)
Pending
action
on
the
articles
of
incorporation
by
inquired
into
collaterally
in
any
private
suit
to
the
aforesaid
governmental
office,
the
respondents
which
the
corporation
may
be
a
party,
but
such
filed
before
the
Court
of
First
Instance
of
Leyte
the
inquiry
may
be
had
at
the
suit
of
the
Insular
civil
case
entitled
"Fred
Brown
et
al.
vs.
Arnold
C.
Hall
Government
on
information
of
the
Attorney-‐General.”
et
al.",
alleging
among
other
things
that
the
Far
Eastern
Lumber
and
Commercial
Co.
was
an
There
are
least
two
reasons
why
this
section
does
not
unregistered
partnership;
that
they
wished
to
have
govern
the
situation.
it
dissolved
because
mismanagement
and
fraud
by
1.
Not
having
obtained
the
certificate
of
incorporation,
the
managers
and
heavy
financial
losses.
the
Far
Eastern
Lumber
and
Commercial
Co.
—
even
its
stockholders
—
may
not
probably
claim
"in
good
(5)
The
defendants
in
the
suit,
C.
Arnold
Hall
and
faith"
to
be
a
corporation.
Bradley
P.
Hall,
filed
a
motion
to
dismiss,
contesting
the
court's
jurisdiction
2.
This
is
not
a
suit
in
which
the
corporation
is
a
party.
This
is
a
litigation
between
stockholders
of
the
alleged
(6)
Hon.
Edmund
S.
Piccio
ordered
the
dissolution
corporation,
for
the
purpose
of
obtaining
its
of
the
company
dissolution.
Even
the
existence
of
a
de
jure
corporation
may
be
terminated
in
a
private
suit
for
its
(7)
Whereupon,
the
present
special
civil
action
was
dissolution
between
stockholders,
without
the
instituted
in
this
court.
It
is
based
upon
two
main
intervention
of
the
state.
propositions,
to
wit:
(a)
The
court
had
no
jurisdiction
to
decree
the
dissolution
of
the
company,
because
it
being
a
de
facto
corporation,
dissolution
thereof
may
only
be