(a) Aggregation of Assets and Resources(b) Business Enterprise or Economic Unit(c) Juridical Entity
3. Relationships Involved in Corporate Setting
(a) Juridical Entity Level
, which views the State-corporations relationship
(b) Contractual Relationship Level
, which considers that the corporate setting is at once acontractual relationship on four (4) levels:- Between the corporation and its agents or representatives to act in the real world, such as itsdirectors and its officers, which is governed also by the Law on Agency;- Between the corporation and its shareholders or members;- Between and among the shareholders in a common venture; and- Between the corporation and third-parties or ³outsiders´, which is essentially governed byContract Law.
. Theories on Formation of Corporation:
Theory of Concession
ayag v. Benguet Consolidated Inc.
, 26 SCRA 242 )To organize a corporation that could claim a juridical personality of its own and transact businessas such, is not a matter of absolute right but a privilege which may be enjoyed only under suchterms as the State may deem necessary to impose (x-
Ang Pue & Co. v.
ec. of Commerce and Industry
, 5 SCRA 645 ).Before a corporation may acquire juridical personality, the State must give its consent either inthe form of a special law or a general enabling act, and the procedure and conditions providedunder the law for the acquisition of such juridical personality must be complied with. The failureto comply with the statutory procedure and conditions does not warrant a finding that suchassociation achieved the acquisition of a separate juridical personality, even when it adopts setsof constitution and by-laws. x
ervices, Inc. v. Court of Appeals,
343 SCRA 674 (2000).Since all corporations, big or small, must abide by the provisions of the Corporation Code, theneven a simple family corporation cannot claim an exemption nor can it have rules and practicesother than those established by law. x
orres v. Court of Appeals
, 278 SCRA 793 (1997).
Theory of Enterprise Entity
heory of Enterprise Entity
, 47 Col. L. Rev. 343)