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  • Corpo - Assign 1 - (11) Lipat v. Pacific Banking Corp. (For Writing)

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    YanaKarunungan
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    The spouses Lipat owned two companies, BET and Mystical Fashions. Teresita, their daughter, managed BET and obtained loans secured by the Lipat's property. When BET was incorporated into BEC, the loans were transferred to BEC. BEC defaulted on payments and the property was foreclosed. The Lipats argued the loans were ultra vires as Teresita lacked board approval. The lower courts dismissed, finding BEC was a family corporation and alter ego of the Lipats. The issue is whether corporate fiction can be pierced. The Supreme Court held that if a corporation allows an agent to act with apparent authority, it cannot deny that authority against good faith dealings through that agent.

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    Corpo - Assign 1 - (11) Lipat v. Pacific Banking Corp. (for Writing)

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    The spouses Lipat owned two companies, BET and Mystical Fashions. Teresita, their daughter, managed BET and obtained loans secured by the Lipat's property. When BET was incorporated into BEC, the loans were transferred to BEC. BEC defaulted on payments and the property was foreclosed. The Lipats argued the loans were ultra vires as Teresita lacked board approval. The lower courts dismissed, finding BEC was a family corporation and alter ego of the Lipats. The issue is whether corporate fiction can be pierced. The Supreme Court held that if a corporation allows an agent to act with apparent authority, it cannot deny that authority against good faith dealings through that agent.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    19 views1 page

    Corpo - Assign 1 - (11) Lipat v. Pacific Banking Corp. (For Writing)

    Uploaded by

    YanaKarunungan
    The spouses Lipat owned two companies, BET and Mystical Fashions. Teresita, their daughter, managed BET and obtained loans secured by the Lipat's property. When BET was incorporated into BEC, the loans were transferred to BEC. BEC defaulted on payments and the property was foreclosed. The Lipats argued the loans were ultra vires as Teresita lacked board approval. The lower courts dismissed, finding BEC was a family corporation and alter ego of the Lipats. The issue is whether corporate fiction can be pierced. The Supreme Court held that if a corporation allows an agent to act with apparent authority, it cannot deny that authority against good faith dealings through that agent.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    LIPAT vs. PACIFIC BANKING CORP.

    [G.R. No. 142435. April 30, 2003.]

    FACTS:

    The spouses Alfredo and Estelita Lipat, owned "Bela's Export Trading" (BET). It was
    engaged in the manufacture of garments. The Lipats also owned the "Mystical Fashions,"
    which sells goods imported from the Philippines through BET. Mrs. Lipat designated her
    daughter, Teresita, to manage BET. Estelita executed a SPA appointing Teresita to obtain
    loans and execute mortgage contracts on properties co-owned by her as security for the
    obligations. Teresita secured a loan from Pacific Bank. As security, Teresita executed a
    continuing Real Estate Mortgage over their property. BET was incorporated into a family
    corporation named Bela's Export Corp. (BEC). The loan was restructured in the name of
    BEC. A letter of credit was also opened, and trust receipts and export bills were executed,
    all secured by the real estate mortgage. The promissory notes, export bills, and trust
    receipt eventually became due and demandable. BEC defaulted in its payments. The real
    estate mortgage was foreclosed and the property was sold at public auction. The spouses
    filed before the RTC a complaint for annulment of the real estate mortgage. They alleged
    that the obluigations were all ultra vires acts of Teresita as they were executed without
    the requisite board resolution from BEC. They also averred that BEC has a personality
    distinct and separate from spouses Lipat. The RTC dismissed the complaint, ruling that
    there was convincing evidence proving that BEC was a family corporation. As such, it
    was a mere extension of petitioners' personality and a mere alter ego of the Lipats. The
    Lipats appealed to the CA which was dismissed. The CA found that there was ample
    evidence to support the application of the doctrine of piercing the veil of corporate
    fiction. Hence, this petition.

    ISSUE:

    Whether or not, the doctrine of piercing the veil of corporate fiction applies to the present
    case.

    HELD:

    It is a familiar doctrine that if a corporation knowingly permits one of its officers or any
    other agent to act within the scope of an apparent authority, it holds him out to the public
    as possessing the power to do those acts; thus, the corporation will, as against anyone
    who has in good faith dealt with it through such agent, be estopped from denying the
    agent's authority.

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