Corpo 1S

1an 8oon 8ee and Co Vs Iarenc|o 163 SCkA 20S

Iacts

Anchor Supply Co sold on credlL Lo Craphlc ubllshlng lnc paper producLs arLlal paymenLs were made
and Lhe balance was covered by a promlssory noLe ln Lhe sald promlssory noLe lL was sLlpulaLed LhaL
Lhe amounL wlll be pald on monLhly lnsLallmenLs and LhaL fallure Lo pay any lnsLallmenL would make Lhe
amounL lmmedlaLely demandable wlLh an lnLeresL of 12 per annum lor fallure of C8APlC Lo pay any
lnsLallmenL peLlLloner flled wlLh Lhe Cll a collecLlon case 1he Lrlal courL ordered C8APlC Lo pay Lhe
peLlLloner Lhe sum of 3036399 wlLh 12 lnLeresL from March 30 1973 unLll fully pald plus Lhe cosLs
of sulL A wrlL of execuLlon was lssued ursuanL Lo Lhe sald lssued wrlL of execuLlon Lhe execuLlng
sherlff levled upon one (1) unlL prlnLlng machlne found ln Lhe premlses of C8APlC

1he prlnLlng machlne was already scheduled for aucLlon sale buL hlllpplne Amerlcan urug Company
(AuCC for shorL) had lnformed Lhe sherlff LhaL Lhe prlnLlng machlne ls lLs properLy and noL LhaL of
C8APlC and accordlngly advlsed Lhe sherlff Lo cease and deslsL from carrylng ouL Lhe scheduled
aucLlon sale noLwlLhsLandlng Lhe sald leLLer Lhe sherlff proceeded wlLh Lhe scheduled aucLlon sale sold
Lhe properLy Lo Lhe peLlLloner lL belng Lhe hlghesL bldder and lssued a CerLlflcaLe of Sale ln favor of
peLlLloner More Lhan flve (3) hours afLer Lhe aucLlon sale and Lhe lssuance of Lhe cerLlflcaLe of sale
AuCC flled an AffldavlL of 1hlrd arLy Clalm wlLh Lhe Cfflce of Lhe ClLy Sherlff LhereafLer a MoLlon
was flled Lo nulllfy Lhe sale

8espondenL [udge ruled ln favor of AuCC hence Lhe aucLlon sale was nulllfled 1he peLlLloner
however conLends LhaL Lhe conLrolllng sLockholders of Lhe hlllpplne Amerlcan urug Co are also Lhe
same conLrolllng sLockholders of Lhe Craphlc ubllshlng lnc and Lherefore Lhe levy upon Lhe sald
machlnery whlch was found ln Lhe premlses occupled by Lhe Craphlc ubllshlng lnc should be upheld

Issue Is ADCC and Graph|c pub||sh|ng one and the same?

ne|d

lL ls Lrue LhaL a corporaLlon upon comlng lnLo belng ls lnvesLed by law wlLh a personallLy separaLe and
dlsLlncL from LhaL of Lhe persons composlng lL as well as from any oLher legal enLlLy Lo whlch lL may be
relaLed 1he docLrlne LhaL a corporaLlon ls a legal enLlLy dlsLlncL and separaLe from Lhe members and
sLockholders who compose lL ls recognlzed and respecLed ln all cases whlch are wlLhln reason and Lhe
law 1hls separaLe and dlsLlncL personallLy ls merely a flcLlon creaLed by law for convenlence and Lo
promoLe [usLlce 1hls separaLe personallLy of Lhe corporaLlon may be dlsregarded or Lhe vell of
corporaLe flcLlon plerced ln cases where lL ls used as a cloak or cover for fraud or lllegallLy or Lo work an
ln[usLlce or where necessary Lo achleve equlLy or when necessary for Lhe proLecLlon of credlLors

CorporaLlons are composed of naLural persons and Lhe legal flcLlon of a separaLe corporaLe personallLy
ls noL a shleld for Lhe commlsslon of ln[usLlce and lnequlLy Llkewlse Lhls ls Lrue when Lhe corporaLlon ls
merely an ad[uncL buslness condulL or alLer ego of anoLher corporaLlon ln such case Lhe flcLlon of
separaLe and dlsLlncL corporaLlon enLlLles should be dlsregarded

lacLual lndlcaLors LhaL AuCC and C8APlC are one and Lhe same enLlLy
AuCC was never engaged ln Lhe prlnLlng buslness
1he board of dlrecLors and Lhe offlcers of C8APlC and AuCC were Lhe same
AuCC holds 30 share of sLock of C8APlC
1he prlnLlng machlne ln quesLlon had been ln Lhe premlses of C8APlC slnce May 1963 long before
AuCC
even acqulred lLs alleged LlLle on !uly 11 1966 from CaplLol ubllshlng 1haL Lhe sald machlne was
allegedly
leased by AuCC Lo C8APlC on !anuary 24 1966 even before AuCC purchased lL from CaplLal
ubllshlng
on !uly 11 1966 only serves Lo show LhaL AuCCs clalm of ownershlp over Lhe prlnLlng machlne ls noL
only
farce and sham buL also unbellevable