G.R. No.

L-23428

November 29, 1968

DETECTIVE & PROTECTIVE BUREAU, INC., petitioner,

vs. THE HONORABLE GAUDENCIO CLORIBEL, in his capacity as Presiding Judge of Branch
VI, Court of First Instance of Manila, and FAUSTINO S. ALBERTO, respondents.

TOPIC: Election of Directors - a. Qualifications of Directors

FACTS:

Detective & Protective Bureau, Inc. (petitioner) was a corporation duly organized and existing
under the laws of the Philippines.

Faustino Alberto (private respondent) was managing director of petitioner corporation from
1952 until Jan. 14, 1946.

In June 1963, Alberto illegally seized and took control of all the assets as well as the books,
records, vouchers and receipts of the corporation from the accountant-cashier, concealed them
illegally and refused to allow any member of the corporation to see and examine the same.

Due to this incident, the stockholders, in a meeting, removed Alberto as managing director and
elected Jose de la Rosa in his stead.

However, Alberto refused to vacate his office and to deliver the assets and books to de la Rosa
and continued to perform unauthorized acts for and in behalf of the corporation.

Petitioner corporation contended that Alberto had arrogated to himself the power of the Board
of Directors of the corporation because he refused to vacate the office and surrender the same
to Jose de la Rosa who has been elected managing director by the Board to succeed him.

This assertion, however, was disputed by respondent Alberto who stated that de la Rosa could
not be elected managing director because he did not own any stock in the corporation.

ISSUE: WON Alberto could be compelled to vacate his office and cede the same to de la Rosa? NO!

HELD:

The Court ruled that there is in no showing in the record the De La Rosa owned a share of
stock in the corporation . If he did not own any share of stock, certainly he could not be a Director
pursuant to the mandatory provision of Sec. 30 of the Corp. code, which in part provides: Every
Director must own in his own right at least one share of the capital stock corporation of which he is a
Director, which stock shall stand in his name on the books of the corporation.
If the managing director-elect (de la Rosa) was not qualified to become managing director,
respondent Fausto Alberto could not be compelled to vacate his office and cede the same to the de la
Rosa because the by-laws of the corporation provides in Art. IV, Sec. 1 that Directors shall serve
until the election and qualification of their duly qualified successor.