Professional Documents
Culture Documents
I. HISTORICAL BACKGROUND
- Castillo v Balinghasay, 440 SCRA 4423
II. CONCEPTS
Definition (Sec. 2; Articles 44(3), 45, 46 and 1775, Civil Code)
- PNB v Andrada Electric & Engineering Co., 381 SCRA 244
- Construction & Dev. Corp. v Cuenca, 466 SCRA 714
2. Corporation as a Person
a. Entitled to Equal Protection of the Law
- Smith Bell & Co. v Natividad, 40 Phil, 136, 144
b. Unreasonable Searches and Seizure
- Stonehill v. Diokno, 20 SCRA 383
c. But NOT Entitled to Privilege Against Self Incrimination
- Bataan Shipyard v PCGG, 150 SCRA 181
3. Practice of Profession
- ULEP v. The Legal Clinic, 223 SCRA 378
- Alfafara v. Acebedo Optical Co., 381 SCRA
V. CLASSIFICATION OF CORPORATIONS
- Sawadjaan v. CA, 459 SCRA 516
- Pioneer Surety vs. CA, 175 SCRA 668
- Shipside, Inc. vs. CA, 352 SCRA 2001
- Baluyot vs. Holganza, 325 SCRA 248
(b) Disadvantages:
1. Abuse of corporate management
2. Abuse of limited liability feature
3. High cost of maintenance
4. Double taxation
Dividends received by individuals from domestic corporations are subject to
final 10% income tax earned on or after 1 January 1998 (Sec. 24(B)(2), 1997
NIRC
Inter-corporate dividends between domestic corporations, however, are not
subject to any income tax (Sec. 27(D)(4), 1997 NIRC
There is reimposition of the 10% "improperly accumulated earnings tax" for
holding companies (Sec. 29, 1997 NIRC)
* Franchise
* Steps in the Creation of a Corporation
a. Promotion
b. Incorporation
c. Formal organization and commencement of business operations
-Incorporation Contracts
- Who are promoters?
VIII. BY-LAWS
a. Nature and Functions
- Grace Christian High School v. Court of Appeals, 281 SCRA 133 (1997)
- Government of P.I. v. El Hogar Filipino, 50 Phil. 399
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2. Express Powers - Secs.36, 37 and 81(1), 38, 40, 42, 43, 44,
- Central Textile Mills, Inc. v. NWPC, 260 SCRA368 (1996)
- Madrigal & Co. v. Zamora, 151 SCRA 355 (1987)
- Litonjua v. Eternit Corp. , 490 SCRA 204 (2006)
- Islamic Directorate v. CA, 272 SCRA 454 (1997);
- Nielson & Co. v. Lepanto Consolidated Mining Co., ,26 SCRA 540
3. Implied Powers - Asia Investments Industries v. CA, 403 SCRA 452 (2003)
4. Incidental Powers - Atrium Management Corp. v. CA, 353 SCRA 23 (2001)
5. Other Powers
- Firme v.Bukal Enterprises and Dev. Corp., 414 SCRA 190 (2003)
- China Banking Corp. v. CA , 270 SCRA 503 (1997)
- TamWing Tak v. Makasiar, 350 SCRA 475 (2001)
- Central Cooperative Exchange Inc. v. Enciso, 162 SCRA 706
- Lopez Realty v. Fontecha, 247 SCRA183, 192 (1995)
- Tuas on & Co. v. Bolanos , 95 Phil. 106 (1954);
- SEC Opinion, dated 29 February 1980
1. Doctrine of Centralized Management: The board is the seat of corporate powers. (Sec. 23)
- Gamboa v. Victoriano, 90 SCRA 40)
1.1. Rationale for Centralized Management Doctrine
- Filipinas Port Services vs. Go, 518 SCRA 453 (2007)
- Hornilla v. Salunat, 405 SCRA 220
1.2. Theories on source of board power
- Angeles v. Santos, 64 Phil. 697
- Tan v. Sycip, 499 SCRA 216
1.3. Board Must Act As A Body (Sec. 25)
- Board of Liquidators v. Heirs of Maximo M.Kalaw, 20 SCRA 987
- Lopez Realty v. Fontecha, 247 SCRA 183
1.4. Effects of Bogus Board
-Islamic Directorate of the Philippines v. CA, 272 SCRA 454
1. Subscription Contract (Sec. 60 & 72); Trillana v. Quezon Colegialla, 93 Phil. 383 [1953]
-Pre-incorporation subscription (Sec. 61) On Yong v. Tiu, 375 SCRA 614 (2002)
2. Consideration - Lincoln Phil. Life v. Court of Appeals, 293 SCRA 92
3. Watered Stocks (Sec. 65)
4. Payment of Balance of Subscription (Secs. 66 and 67)
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10. Right to Proportionate Share of Remaining Assets Upon Dissolution (Secs. 122, 94 and
95)
- Central Textile Mills v. Nat'l Wage and Productivity Commission, 260 SCRA 368
(REPUBLIC ACT No. 10142 [FRIA LAW OF 2010], PD 902-A, Securities Regulation Code [RA
8799] - PAL v. PALEA, 525 SCRA 29 (2007).