PSBA

vs.
LEANO
GR L- 58468 February 24, 1984

FACTS:

Tan is one of the stockholders of PSBA. He was a director and Executive

Vice- President enjoying salaries and allowances. During a regular meeting, the
Board of Directors declared all corporate positions vacant except those of the
president and chairman and at the same time elected new set of officers. Tan
was not re elected for which he filed for illegal dismissal before the NLRC. He
also instituted a one million peso damage suit before the Court of First Instance
for the illegal and oppressive removal. He lodged another complaint with the
SEC questioning the validity of the elections and his ouster. The SEC issued a
subpoena duces tecum commanding the production of all corporate documents,
records, books. The Labor Arbiter also issued a subpoena duces tecum for the
production of the same records and documents. Petitioners moved for the
dismissal of the complaint before the NLRC invoking the principle against split
jurisdiction.

ISSUE:

Whether or not the NLRC has jurisdiction over the case.

RULING:

NO.

PSBA is a domestic corporation duly organized and existing under our

laws. General management is vested in a Board of seven elected annually by
stockholders entitled to vote, who serve until the election and qualification of
their successors. Any vacancy in the board of directors is filled up by a majority
vote of the subscribed capital stock entitled to vote at a meeting generally called
for the purpose, and the directors so chosen shall hold office for the unexpired
term. Corporate officers are provided for, among them, the Executive Vice-
President, who is elected by the board from their own number. The officers
receive such salaries as the board may fix. The by-laws likewise provide that
should the office be rendered vacant by reason of death, resignation,
disqualification or otherwise, the board, by a majority vote may choose a
successor who shall hold office for the unexpired term of the predecessor.
 The controversy is intra-corporate in nature. It revolves around the
election of directors, officers and managers of PSBA, the relation between and
among its stockholders, and between them and the corporation. PD 902-A vests
in the SEC the original and exclusive jurisdiction to hear and decide cases
involving controversies arising out of intra-corporate relations between and
among stockholders, and between the stockholders and the corporation. It also
has exclusive jurisdiction over controversies involving the election and
appointment of officers, directors, trustees or managers of such corporation.
The case is not a case of dismissal. The case is that of a corporate office
having been declared vacant and of Tans not having been re-elected thereafter.
The matter of whom to elect is a prerogative that belongs to the Board and
involves the exercise of deliberate choice and the faculty of discriminative
selection. Generally speaking, the relationship of a person to the corporation,
whether as an officer or as agent or employee, is not determined by the services
performed but by the incidents of the relationship as they actually exist.