Rev. Luis Ao-As, et al.

v.
Court of Appeals
G.R. No. 128464
June 20, 2006
Facts:

This petition involves an intra-corporate dispute concerning the management of the

Lutheran Church of the Philippines (LCP), a religious organization which led SEC to organize and
create a Management Committee. Subsequent to the establishment of the said committee, LCP
held a national convention where members initiated an election, in line with the organization’s
By-Laws for a new set of church leaders because the incumbent directors were enjoined to act
as Board. As provided for in the LCP By-Laws, directors are elected by division, to the exception
of the President which is elected through the National Convention. Various issues were raised by
the parties before the SEC, which were all denied in favor of the SEC Management Committee.
When appealed to the CA, the latter aside from ruling on other relevant issues also nullified the
manner of election conducted by LCP for being in violation of the Corporation Code which
requires the presence of majority of the members entitled to vote at the election. Hence, this
petition.

Issue: Whether or not the manner of election of the BOD of LCP as provided in its By-Laws is
invalid.

Ruling: No.

The matter of how the directors or other leaders of a church shall be chosen is a matter of
ecclesiastical law or custom which is outside the jurisdiction of civil courts. In any case, the
stipulation in the By-Laws is not contrary to the Corporation Code. Section 89 of the Corporation
Code pertaining to non-stock corporations provides that "(t)he right of the members of any class
or classes (of a non-stock corporation) to vote may be limited, broadened or denied to the extent
specified in the articles of incorporation or the by-laws. This is an exception to Section 6 of the
same code where it is provided that "no share may be deprived of voting rights except those
classified and issued as ‘preferred’ or ‘redeemable’ shares, unless otherwise provided in this
Code." The stipulation in the By-Laws providing for the election of the Board of Directors by
districts is a form of limitation on the voting rights of the members of a non-stock corporation as
recognized under the aforesaid Section 89. Section 24, which requires the presence of a majority
of the members entitled to vote in the election of the board of directors, applies only when the
directors are elected by the members at large, such as is always the case in stock corporations by
virtue of Section 6.