1. ARB Construction Co., Inc.

vs Court of Appeals 332 scra 427

In 1993, ARB Construction Co., Inc. (ARB) entered into a contract with TBS Security and Investigation Agency
(TBS) for the latter to provide security guards to guard the premises of ARB. But in 1994, while the contract is still
subsisting, ARB, through its Vice President for Operations Mark Molina, preterminated the contract because it
alleged that the TBS guards were grossly negligent and inefficient. TBS opposed the same. ARB reconsidered but it
removed all other TBS guards except for one. ARB, through Molina, also withheld payroll payments to TBS as it
alleged that due to the negligence of the guards, the premises of ARB incurred losses through burglary that
happened while the guards were on duty. TBS filed an injunction case against ARB. It later amended said complaint
to include claims for damages against ARB as well as against Molina in his personal capacity as it was alleged that
Molina concocted some of these facts.
ISSUE: Whether or not Molina should be impleaded.
HELD: No. It is basic that a corporation is invested by law with a personality separate and distinct from those of the
persons composing it as well as from that of any other legal entity to which it may be related. As a general rule, a
corporation may not be made to answer for acts or liabilities of its stockholders or those of the legal entities to which
it may be connected and vice versa. Molina can’t be held liable jointly and severally liable with ARB. There was no
showing that he acted with bad faith. The salary deductions he made as vice president were not without basis; there
was no malice on his part.

2. Lyceum of the Philippines vs. Court of Appeals 219 SCRA 610

[GR 101897, 5 March 1993]

Facts: Lyceum of the Philippines Inc. had sometime before commenced in the SEC a proceeding (SEC-Case No. 1241) against
the Lyceum of Baguio, Inc. to require it to change its corporate name and to adopt another name not "similar [to] or identical"
with that of petitioner. In an Order dated 20 April 1977, Associate Commissioner Julio Sulit held that the corporate name of
petitioner and that of the Lyceum of Baguio, Inc. were substantially identical because of the presence of a "dominant" word, i.e.,
"Lyceum," the name of the geographical location of the campus being the only word which distinguished one from the other
corporate name. The SEC also noted that Lyceum of the Philippines Inc. had registered as a corporation ahead of the Lyceum
of Baguio, Inc. in point of time, and ordered the latter to change its name to another name "not similar or identical [with]" the
names of previously registered entities. The Lyceum of Baguio, Inc. assailed the Order of the SEC before the Supreme Court
(GR L-46595). In a Minute Resolution dated 14 September 1977, the Court denied the Petition for Review for lack of merit. Entry
of judgment in that case was made on 21 October 1977.

Armed with the Resolution of the Supreme Court, the Lyceum of the Philippines then wrote all the educational institutions it
could find using the word "Lyceum" as part of their corporate name, and advised them to discontinue such use of "Lyceum."
When, with the passage of time, it became clear that this recourse had failed, and on 24 February 1984, Lyceum of the
Philippines instituted before the SEC SEC-Case 2579 to enforce what Lyceum of the Philippines claims as its proprietary right to
the word "Lyceum." The SEC hearing officer rendered a decision sustaining petitioner's claim to an exclusive right to use the
word "Lyceum." The hearing officer relied upon the SEC ruling in the Lyceum of Baguio, Inc. case (SEC-Case 1241) and held
that the word "Lyceum" was capable of appropriation and that petitioner had acquired an enforceable exclusive right to the use
of that word. On appeal, however, by Lyceum Of Aparri, Lyceum Of Cabagan, Lyceum Of Camalaniugan, Inc., Lyceum Of Lallo,
Inc., Lyceum Of Tuao, Inc., Buhi Lyceum, Central Lyceum Of Catanduanes, Lyceum Of Southern Philippines, Lyceum Of
Eastern Mindanao, Inc. and Western Pangasinan Lyceum, Inc.,, which are also educational institutions, to the SEC En Banc, the
decision of the hearing officer was reversed and set aside. The SEC En Banc did not consider the word "Lyceum" to have
become so identified with Lyceum of the Philippines as to render use thereof by other institutions as productive of confusion
about the identity of the schools concerned in the mind of the general public. Unlike its hearing officer, the SEC En Banc held
that the attaching of geographical names to the word "Lyceum" served sufficiently to distinguish the schools from one another,
especially in view of the fact that the campuses of Lyceum of the Philippines and those of the other Lyceums were physically
quite remote from each other. Lyceum of the Philippines then went on appeal to the Court of Appeals. In its Decision dated 28
June 1991, however, the Court of Appeals affirmed the questioned Orders of the SEC En Banc. Lyceum of the Philippines filed a
motion for reconsideration, without success. Lyceum of the Philippines filed the petition for review.

Issue:

1. Whether the names of the contending Lyceum schools are confusingly similar.
2. Whether the use by the Lyceum of the Philippines of "Lyceum" in its corporate name has been for such length of time
and with such exclusivity as to have become associated or identified with the petitioner institution in the mind of the
general public (or at least that portion of the general public which has to do with schools).

Held:

1. The Articles of Incorporation of a corporation must, among other things, set out the name of the corporation. Section 18 of the
Corporation Code establishes a restrictive rule insofar as corporate names are concerned. It provides that "No corporate name
may be allowed by the Securities an Exchange Commission if the proposed name is identical or deceptively or confusingly
similar to that of any existing corporation or to any other name already protected by law or is patently deceptive, confusing or
contrary to existing laws. When a change in the corporate name is approved, the Commission shall issue an amended certificate
of incorporation under the amended name." The policy underlying the prohibition in Section 18 against the registration of a
corporate name which is "identical or deceptively or confusingly similar" to that of any existing corporation or which is "patently
deceptive" or "patently confusing" or "contrary to existing laws," is the avoidance of fraud upon the public which would have
occasion to deal with the entity concerned, the evasion of legal obligations and duties, and the reduction of difficulties of
administration and supervision over corporations. Herein, the Court does not consider that the corporate names of the academic
institutions are "identical with, or deceptively or confusingly similar" to that of Lyceum of the Philippines Inc.. True enough, the
corporate names of the other schools (defendant institutions) entities all carry the word "Lyceum" but confusion and deception
are effectively precluded by the appending of geographic names to the word "Lyceum." Thus, the "Lyceum of Aparri" cannot be
mistaken by the general public for the Lyceum of the Philippines, or that the "Lyceum of Camalaniugan" would be confused with
the Lyceum of the Philippines. Further, etymologically, the word "Lyceum" is the Latin word for the Greek lykeion which in turn
referred to a locality on the river Ilissius in ancient Athens "comprising an enclosure dedicated to Apollo and adorned with
fountains and buildings erected by Pisistratus, Pericles and Lycurgus frequented by the youth for exercise and by the
philosopher Aristotle and his followers for teaching." In time, the word "Lyceum" became associated with schools and other
institutions providing public lectures and concerts and public discussions. Thus today, the word "Lyceum" generally refers to a
school or an institution of learning. Since "Lyceum" or "Liceo" denotes a school or institution of learning, it is not unnatural to use
this word to designate an entity which is organized and operating as an educational institution. To determine whether a given
corporate name is "identical" or "confusingly or deceptively similar" with another entity's corporate name, it is not enough to
ascertain the presence of "Lyceum" or "Liceo" in both names. One must evaluate corporate names in their entirety and when the
name of Lyceum of the Philippines is juxtaposed with the names of private respondents, they are not reasonably regarded as
"identical" or "confusingly or deceptively similar" with each other.

2. The number alone of the private respondents in the present case suggests strongly that the Lyceum of the Philippines' use of
the word "Lyceum" has not been attended with the exclusivity essential for applicability of the doctrine of secondary meaning. It
may be noted also that at least one of the private respondents, i.e., the Western Pangasinan Lyceum, Inc., used the term
"Lyceum" 17 years before Lyceum of the Philippines registered its own corporate name with the SEC and began using the word
"Lyceum." It follows that if any institution had acquired an exclusive right to the word "Lyceum," that institution would have been
the Western Pangasinan Lyceum, Inc. rather than Lyceum of the Philippines. Hence, Lyceum of the Philippines is not entitled to
a legally enforceable exclusive right to use the word "Lyceum" in its corporate name and that other institutions may use
"Lyceum" as part of their corporate names.

3. Harry Stonehill et al vs DOJ Secretary Jose Diokno

Facts: Respondents issued, on different dates, 42 search warrants against petitioners personally, and/or corporations
for which they are officers directing peace officers to search the persons of petitioners and premises of their offices,
warehouses and/or residences to search for personal properties “books of accounts, financial records, vouchers,
correspondence, receipts, ledgers, journals, portfolios, credit journals, typewriters, and other documents showing all
business transactions including disbursement receipts, balance sheets and profit and loss statements and
Bobbins(cigarettes)” as the subject of the offense for violations of Central Bank Act, Tariff and Customs Laws, Internal
Revenue Code, and Revised Penal Code.
Upon effecting the search in the offices of the aforementioned corporations and on the respective residences of the
petitioners, there seized documents, papers, money and other records. Petitioners then were subjected to deportation
proceedings and were constrained to question the legality of the searches and seizures as well as the admissibility of
those seized as evidence against them.
On March 20, 1962, the SC issued a writ of preliminary injunction and partially lifted the same on June 29, 1962 with
respect to some documents and papers.

ISSUE: Whether or not the search warrant issued is valid.

Held: Search warrants issued were violative of the Constitution and the Rules, thus, illegal or being general
warrants. There is no probable cause and warrant did not particularly specify the things to be seized. The purpose of
the requirement is to avoid placing the sanctity of the domicile and the privacy of communication and
correspondence at the mercy of the whims, caprice or passion of peace officers.
Document seized from an illegal search warrant is not admissible in court as a fruit of a poisonous tee. However,
they could not be returned, except if warranted by the circumstances.
Petitioners were not the proper party to question the validity and return of those taken from the corporations for
which they acted as officers as they are treated as personality different from that of the corporation.
4. Corporate Law Case Digest: Tan V. SEC (1992)

Alfonso S. Tan devised the scheme of not returning the cancelled Stock Certificate No. 2 which was
returned to him for his endorsement, to skim off the largesse of the corporation as shown by the trading of his Stock
Certificate No. 8 for goods of the corporation valued at P2M when the par value of the same was only worth P35K.
Although it is sometimes regarded as quasi-negotiable, in the sense that it may be transferred by
endorsement, coupled with delivery, it is well-settled that it is non-negotiable, because the holder thereof takes it
without prejudice to such rights or defenses as the registered owner/s or transferror's creditor may have under the
law, except insofar as such rights or defenses are subject to the limitations imposed by the principles governing
estoppel.

5. Associated Bank vs. Court of Appeals 291 scra 511

FACTS:

Associated Banking Corporation and Citizens Bank and Trust Company (CBTC) merged to form just one banking
corporation known as Associated Citizens Bank (later renamed Associated Bank), the surviving bank. After the
merger agreement had been signed, but before a certificate of merger was issued, respondent Lorenzo Sarmiento,
Jr. executed in favor of Associated Bank a promissory note, promising to pay the bank P2.5 million on or before due
date at 14% interest per annum, among other accessory dues. For failure to pay the amount due, Sarmiento was
sued by Associated Bank.
Respondent argued that the plaintiff is not the proper party in interest because the promissory note was executed in
favor of CBTC. Also, while respondent executed the promissory note in favor of CBTC, said note was a contract
pour autrui, one in favor of a third person who may demand its fulfillment. Also, respondent claimed that he received
no consideration for the promissory note and, in support thereof, cites petitioner's failure to submit any proof of his
loan application and of his actual receipt of the amount loaned.

ISSUE: Whether or not Associated Bank, the surviving corporation, may enforce the promissory note made by
private respondent in favor of CBTC, the absorbed company, after the merger agreement had been signed, but
before a certificate of merger was issued?

HELD:

The petition is impressed with merit.

Associated Bank assumed all the rights of CBTC. Although absorbed corporations are dissolved, there is no winding
up of their affairs or liquidation of their assets, because the surviving corporation automatically acquires all their
rights, privileges and powers, as well as their liabilities. The merger, however, does not become effective upon the
mere agreement of the constituent corporations. The Securities and Exchange Commission (SEC) and majority of
the respective stockholders of the constituent corporations must have approved the merger. (Section 79,
Corporation Code) It will be effective only upon the issuance by the SEC of a certificate of merger. Records do not
show when the SEC approved the merger.

But assuming that the effectivity date of the merger was the date of its execution, we still cannot agree that
petitioner no longer has any interest in the promissory note. The agreement itself clearly provides that all contracts
— irrespective of the date of execution — entered into in the name of CBTC shall be understood as pertaining to the
surviving bank, herein petitioner. Such must have been deliberately included in the agreement in order to avoid
giving the merger agreement a farcical interpretation aimed at evading fulfillment of a due obligation. Thus, although
the subject promissory note names CBTC as the payee, the reference to CBTC in the note shall be construed,
under the very provisions of the merger agreement, as a reference to petitioner bank.