PART II.

LIFE
I.

CORPORATE POWERS AND AUTHORITY

A. Express Powers (Sec. 36)
1. To sue and be sued
2. Succession
3. To adopt a corporate seal
4. To amend its articles of incorporation (See Sec. 17)
5. To adopt and amend by-laws (See Sec. 47)
6. To issue, sell stocks and treasury stocks (See Sec. 7); to admit members if nonstock corporation
7. To purchase, receive, take or grand, hold convey deal with real and personal
property, including securities and bonds
8. To enter into merger or consolidation
9. To make reasonable donations
10. To establish pension, retirement and other plans for the benefit of its directors,
trustees, officers and employees
11. To extend or shorten corporate term (Sec. 37)
12. To increase or decrease capital stock (Sec. 38)
13. To incur, create or increase bonded indebtedness (Sec. 38)
14. To deny pre-emptive right (Sec. 39)
15. To sell all or substantially all of its assets (Sec. 40)
16. To acquire its own shares (Sec. 41)
17. To invest funds in another corporation; secondary purpose (Sec. 42)
18. To declare dividends (Sec. 43)
19. To enter into management contracts (Sec. 44)
B. Inherent or incidental (Sec. 36; Sec. 2)
C. Implied [Sec. 36 (11)]
D. Ultra Vires acts (Sec. 45)

Cases:
1.
2.
3.
4.
5.
6.

Republic vs Acoje Mining

Pirovano vs. Dela Rama Steamship (G.R. No. L-5377, Dec. 29, 1954)
Cebu Mactan Members Center, Inc. vs. Tshukahara (G.R. No. 159624, July 17, 2009)
Koji Yasuma vs. Heirs of De Villa, et al. (G.R. No. 150350, August 22, 2006)
Advance Paper Corp. vs. Arma Traders Corp., et al. (G.R No. 176897, December 11, 2013)
Citibank N.A., vs. Chua, et al. (G.R. No. 102300, March 17, 1993)

Opinions:
1.
2.
3.

II.

SEC OGC Opinion No. 11-33

SEC OGC Opinion No. 11-41
SEC OGC Opinion No. 11-41

ORGANIZATIONAL STRUCTURE
A. Stockholders/Members
B. Board of Directors/Trustees
1. Qualifications and composition (Sec. 23)
2. Election (Sec. 24)
3. Disqualification (Sec. 27)
4. Removal (Sec. 28)
5. Vacancies (Sec. 29)
6. Compensation (Sec. 30)

7. Liability (Sec. 31)

8. Dealings with the corporation (Sec. 32)
9. Contracts with Interlocking directors (Sec. 33; Sec. 32)
10. Disloyalty (Sec. 34)
C. Corporate Officers
1. Qualifications and Composition (Sec. 25)
2. Disqualifications (Sec. 27)
3. Liability (Sec. 31)
4. Dealings with the corporation (Sec. 32)
Cases:
1.
2.

Matling Industrial and Commercial Corp. V. Coros, G.R. No. 157802, October 13, 2010.
Real vs. Sangu Philippines, G.R. No. 168757, January 2011.

SEC Opinions:
1. SEC Opinion No. 15-13
2. SEC Opinion No. 05-15
III.

MEETINGS
A. Of the Stockholders/Members
1. Kinds (Sec. 49)
2. Requirements; written notice (Sec. 50)
3. Presiding officer (Sec. 54)
4. When there is no person authorized to call a meeting (Sec. 50)
5. Place and time (Sec. 51)
6. Quorum (Sec. 52)
B. Of the Directors/Trustees
1. Kinds (Sec. 53)
2. Requirements (Sec. 53)
3. Presiding officer (Sec. 54)
C. Right to attend/vote at stockholders meetings
1. Pledgors, mortgagors (Sec. 55)
2. Executors and administrators (Sec. 55)
3. Joint owners of stocks (Sec. 56)
4. Proxies (Sec. 58)
5. Voting Trusts (Sec. 59)
6. Effect of delinquency (Sec. 71)

CASES:
1.

Tan vs. Sycip

IV. RELATIONSHIPS
A. Tri-Level Relationship
1. Stockholders vis--vis the Corporation
a. Rights of stockholders in general
b. Derivative suit
i.
Concept
ii.
Requisites

c. Liabilities of stockholders
d. Subscription contract (Sec. 60)
e. Pre-incorporation subscription (Sec. 61)
f. Effect of delinquency (Sec. 71)
g. Rights of unpaid shares (Sec. 72)
h. Right to inspect corporate records
i. Appraisal Rights
i.)
ii.)
iii.)
iv.)
v.)
vi.)

Instances of appraisal right (Sec. 81)

How right is exercised (Sec. 82)
Effect of demand and termination of right (Sec. 83)
When right to payment ceases (Sec. 84)
Who bears costs of appraisal (Sec. 85)
Notation on certificates; rights of transferee (Sec. 86)

2. Stockholders vis--vis the Directors

3. Corporate Officers vis--vis the Corporation
B. Intra-corporate Dispute
1. Concept
2. Tests
3. Jurisdiction
Cases:
1. Matling Industrial and Commercial Corp. V. Coros, G.R. No. 157802, October 13, 2010
2. Magalad vs. Premiere Financing Corporation G.R. No. 87135 May 22, 1992.
3. Oscar Reyes vs. Hon. Regional Trial Court of Makati, Branch 142, et al. G. R. No. 165744,
August 11, 2008.
4. DMRC Enterprises v. Esta del Sol Mountain, G.R. No. L-57936 September 28, 1984.
5. Speed Distributing Corp vs. Court of Appeals, G.R. No. 149351, March 17, 2004.
6. Strategic Alliance Development Corporation vs. Star Infastructure Development Corporation, et
al. G.R. No. 187872, November 17, 2010.
7. Valley Golf and Country Club, Inc. vs. Caram, G.R. No. 158805, April 16, 2009.
SEC Opinions:
1.

SEC Opinion No. 10-15

C. Merger and Consolidation

Concept and Definition (Sec. 76)
Requisites
a.) Approval (Sec. 77)
b.) Articles of merger or consolidation (Sec. 78)
c.) Effectivity (Sec. 79)
3. Effects (Sec. 80)
1.
2.

Cases:

1.

Mindanao Savings and Loan Association, Inc. vs. Willkom, G.R. No. 178618, October 11, 2010.