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SUPREME COURT REPORTS ANNOTATED VOLUME 058 1/16/18, 13:04
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* SECOND DIVISION.
560
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561
as said above, did not constitute the common interest over the
subject matter indispensable in a class suit. The right to purchase
or subscribe to the shares of the proposed Bank, claimed by
appellants herein, is analogous to the right of preemption that
stockholders have when their corporation increases its capital. The
right of preemption, it has been said, is personal to each
stockholder, and while a stockholder may maintain a suit to compel
the issuance of his proportionate share of stock, it has been ruled,
nevertheless, that he may not maintain a representative action on
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563
ZALDIVAR, J.:
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564
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565
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566
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appellees;
VII. In not holding that a trust relationship existed
between the Interim Board of Organizers of
defendant-appellee Bank and the CMI subscribing
stockholders and in not holding that the waiver was
in favor of the Board of Trustees for the CMI
subscribing stockholders;
568
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569
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570
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571
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that a class
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572
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„It appears to be the theory of the plaintiffs borne out by the prayer,
that each subscribing CMI stockholder is entitled to further
subscribe to a certain proportion, depending upon his stockholding
in the CMI, of the P8 million capital stock of the defendant bank
open to subscription (out of the P20 million authorized capital
stock) as well as the unsubscribed portion of the P8 million stock
offering which were left unsubscribed by those CMI stockholders
who for one reason or another had failed to exercise their
subscription rights on or before
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573
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574
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14 See Barron and Holtsoff, Federal Practice and Procedure Vol 2, page
139.
15 MooreÊs Federal Practice, Vol. 3, pages 3442–3443.
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575
17
similarly situated. By analogy, the right of each of the
appellants to subscribe to the waived stocks was personal,
and no one of them could maintain on behalf of others
similarly situated a representative suit.
Straining to make it appear that appellants and the
CMI subscribing stockholders had a common or general
interest in the subject matter of the suit, appellants
stressed in their brief that one of the reliefs sought in the
instant action was „to divest defendant individuals and the
persons or entities 18
chosen by them of control of the
defendant bank." This relief allegedly sought by
appellants did not, however, appear either in the text or in
the prayer of the complaint.
Appellants, furthermore, insisted that insufficiency of
number in a class suit was not a ground for dismissal of
one action. This Court has, however, said that where it
appeared that no sufficient representative parties had been
joined, the dismissal by the trial court of the action, despite
the contention
19
by plaintiffs that it was a class suit, was
correct. Moreover. insofar as the instant case is concerned,
even if it be granted for the sake of argument, that the suit
could not be dismissed on that ground, it could have been
dismissed, nevertheless, on the ground of lack of cause of
action which will be presently discussed.
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agreement,20
constituted a valid and sufficient cause
of action; and that only the allegations in the
complaint should have been considered by the trial
court in
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17 Dousman v. Wisconsin & L.S. Min. & Smelting Co., 40 Wis. 418 in
12 L.R.A., New Series, 1908, page 972.
18 Brief for the Plaintiffs-Appellants and Movants-Intervenors-
Appellants, page 25.
19 Niembra, et al., vs. Director of Lands, L-20084, July 17, 1964, 11
SCRA 525, 528.
20 Brief for Plaintiffs-Appellants and Movants-Intervenors-Appellants,
pages 32–34.
576
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577
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578
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27 Ma-ao Sugar Central Co., Inc. vs. Barrios, et al., 79 Phil. 666, 667;
Ramitere, et al. vs. Montinola Vda. de Yulo, et al. L-1975l, February 28,
1966, 16 SCRA 251, 255.
28 Community Investment and Finance Corp. vs. Garcia, 88 Phil. 215,
218.
29 41 Am. Jur., page 303.
579
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„If from the facts in evidence, the result can be reached by that
process of natural reasoning adopted in the investigation of truth, it
becomes an ultimate fact, to be found as such. If, on the other hand,
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580
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Board of Organizers
38
of the defendant Bank and their
assignees"; that in the Articles of Incorporation prepared
by the Board of Organizers, the individuals-defendants-
appellees
39
alone appeared to have subscribed to the 50,000
shares; and that individuals-defendants-appellees
40
again
subscribed to all the additional 30,000 shares. From these
facts, appellants concluded that they were denied 41
their
right to subscribe in proportion to their equities; that the
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585
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