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CORP OUTLINE 2017 2nd Installment No Marking
CORP OUTLINE 2017 2nd Installment No Marking
Textbook:
PHILIPPINE CORPORATE LAW (Latest Edition)
by: Atty. Cesar L Villanueva
Grading System:
Recitation - 30%
Quizzes - 10%
Prelim - 20%
Midterms - 20%
Finals - 20%
I HISTORICAL BACKGROUND
1 Philippine Corporate Law:1[2] Sort of Codification of American Corporate Law
Harden v Benguet Consolidated Mining, 58 Phil 141 (1933)
2 The Corporation Law
3 The Corporation Code
4 Proper Treatment of Philippine Corporate Law
II CONCEPTS
1 Definition (Section 2; Articles 44(3), 45, 46, and 1775, Civil Code)
Monfort Hermanos Agricultural Dev. Corp. v. Monfort III, 434 SCRA 27 (2004) (590)
2 Tri-Level Existence of the Corporation
(a) Aggregation of Assets and Resources
(b) Business Enterprise or Economic Unit
(c) Juridical Entity
3 Relationships Involved in a Corporate Setting
(a) Juridical Entity Level
(b) Contractual Relationship Level
Between the corporation and its agents or representatives
Between the corporation and its shareholders or members
Between and among the shareholders in a common venture
Between the corporation and third-parties or "outsiders"
4 Theories on the Formation of Corporation:
(a) Theory of Concession
Tayag v Benguet Consolidated, 26 SCRA 242 [1968])
International Express Travel & Tour Services, Inc v Court of Appeals, 343 SCRA 674 (2000)
Torres v Court of Appeals, 278 SCRA 793 (1997)
Ang Pue & Co v Sec of Commerce and Industry, 5 SCRA 645 (1962)
(b) Theory of Enterprise Entity
1
Land Bank of the Philippines v. Court of Appeals, 364 SCRA 375 (2001) (597)
San Juan Structural and Steel Fabricators, Inc v Court of Appeals, 296
SCRA 631 (1998)
Consolidated Bank and Trust Corp v Court of Appeals, 356 SCRA 671(2001)
Malayang Samahan ng mga Manggagawa sa M Greenfield v Ramos, 357
SCRA 77 (2001)
(iii) FREE TRANSFERABILITY OF UNITS OF OWNERSHIP FOR INVESTORS
(iv) CENTRALIZED MANAGEMENT
(b) Disadvantages:
(i) Abuse of corporate management
(ii) Abuse of limited liability feature
(iii) Cost of maintenance
(iv) Double taxation Sec 24(B)(2), 1997 NIRC; Sec 27(D)(4), 1997 NIRC; Sec 29, 1997
NIRC
7 COMPARED WITH OTHER BUSINESS MEDIA
4 Distribution of Risk, Profit and Control 4
(a) Sole Proprietorships
(b) Partnerships and Other Associations (Arts 1768 and 1775, Civil Code)
- Can a defective attempt o form a corporation result at least in the formation of a
partnership?
Pioneer Insurance v Court of Appeals, 175 SCRA 668 (1989)
(c) Joint Ventures
Kilosbayan, Inc v Guingona, Jr, 232 SCRA 110 (1994)
(d) Cooperatives (Art 3, RA No 6938)
Corpuz v Grospe, 333 SCRA 425 (2000)
(e) Business Trusts (Article 1442, Civil Code)
(f) Sociedades Anónimas
Mead v McCullough, 21 Phil 95,106 (1911)
Benguet Consolidated Mining Co v Pineda, 98 Phil 711 (1956)
Phil Product Co v Primateria Societe Anonyme, 15 SCRA 301 (1965)
(g) Cuentas En Participacion - Article 239 of the Code of Commerce
Bourns v Carman, 7 Phil 117 (1906)
III NATURE AND ATTRIBUTES OF A CORPORATION
1 Nature of Power to Create a Corporation (Sec 16, Article XII, 1987 Constitution)
NDC v Philippine Veterans Bank, 192 SCRA 257 (1990)
Feliciano v. Commission on Audit, 419 SCRA 363 (2004)
2 CORPORATION AS A PERSON:
(a) Entitled to Due Process
Albert v University Publishing Co, 13 SCRA 84 [1965]
Smith Bell & Co v Natividad, 40 Phil 136, 144 (1920)
(b) Equal Protection Clause
Smith Bell & Co v Natividad, 40 Phil 136 [1920])
(c) Unreasonable Searches and Seizure
Stonehill v Diokno, 20 SCRA 383 (1967)
Bache & Co (Phil), Inc v Ruiz, 37 SCRA 823, 837 (1971)
(d) But Not Entitled to Privilege Against Self incrimination
Bataan Shipyard & Engineering v PCGG, 150 SCRA 181 (1987)
3 Liability for Torts
PCIBank v. Court of Appeals, 350 SCRA 446 (2001) (631)
Professional Services, Inc. v. Court of Appeals, 611 SCRA 282 (2010) (632)
PNB v Court of Appeals, 83 SCRA 237 (1978)
Sergio F Naguiat v NLRC, 269 SCRA 564 (1997)
4 Corporate Criminal Liability
Republic Gas Corp. v. Petron Corp, 698 SCRA 666 (2013) (633)
Espiritu v. Petron Corp., 605 SCRA 245 (2009) (633)
Ching v. Secretary of Justice, 481 SCRA 602 (2006) (633)
Tupaz IV v. Court of Appeals, 476 SCRA 398 (2005) (634)
The Executive Secretary v. Court of Appeals, 429 SCRA 81 (2004) (635)
West Coast Life Ins Co v Hurd, 27 Phil 401 (1914)
People v Tan Boon Kong, 54 Phil 607 [1930]
Sia v Court of Appeals, 121 SCRA 655 [1983]
2
People v Concepcion, 44 Phil 129 (1922)
Cometa v Court of Appeals, 301 SCRA 459 (1999)
Strategic Alliance Development Corporation v. Redstock Securities Ltd., 607 SCRA 413 (629)
J.G. Summit Holdings, Inc. v. Court of Appeals, 450 SCRA 169, (631)
Roman Catholic Apostolic Administrator of Davao, Inc v The LRC and the Register of Deeds of
Davao, 102 Phil 596 [1957])
Register of Deeds of Rizal v Ung Sui Si Temple, 97 Phil 58 (1955)
3
A MAIN DOCTRINE: A CORPORATION HAS A PERSONALITY SEPARATE AND DISTINCT FROM ITS
STOCKHOLDERS OR MEMBERS
1 Sources: Sec 2; Article 44, Civil Code
2 Importance of Protecting Main Doctrine:
San Juan Structural v Court of Appeals, 296 SCRA 631 (1998)
LBP v Court of Appeals, 364 SCRA 375 (2001)
3 Applications:
(a) Majority Ownership of or Dealings in Shareholdings:
Secosa v. Heirs of Erwin Suarez Francisco, 433 SCRA 273 (2004)
Jardine Davis, Inc. v. JRB Realty Inc., 463 SCRA 555 (2005)
Hacienda Luisita Inc. v. Presidential Agrarian Reform Council, 660 SCRA 525 (2005)
Const. & Dev. Corp. of the Phil. V. Cuenca, 466 SCRA 714 (2005)
Sliverio, Jr. v. Filipino Business Consultants, 466 SCRA 584
DBP v NLRC, 186 SCRA 841 (1990)
Sunio v NLRC , 127 SCRA 390 (1984)
Asionics Philippines, Inc v NLRC, 290 SCRA 164 (1998)
Francisco v Mejia, 362 SCRA 738 (2001)
Laguio v NLRC, 262 SCRA 715 (1996)
(b) Dealings Between the Corporation and Stockholders:
Situs Development Bank Corp. v. Asiatrust Bank, 677 SCRA 495 (2012)
Marian v. Petron Corp., 610 SCRA 487 (2010)
Stockholders of F Guanzon and Sons, Inc v Register of Deeds of Manila, 6 SCRA 373 (1962)
LBP v Court of Appeals, 364 SCRA 375 (2001)
Remo, Jr v IAC, 172 SCRA 405 (1989)
PNB v Ritratto Group, Inc, 362 SCRA 216 (2001)
(c) On Privileges Enjoyed
Manila Gas Corp v Collector of Internal Revenue, 62 Phil 895 (1936)
(d) Being a Corporate Officer
Good Earth Emporium, Inc v CA, 194 SCRA 544 (1991)
Cruz v Dalisay, 152 SCRA 487 (1987)
Booc v Bantuas, 354 SCRA 279 (2001)
Intestate Estate of Alexander T Ty v Court of Appeals, 356 SCRA 61 (2001)
(e) Obligations and Debts
Traders Royal Bank v Court of Appeals, 177 SCRA 789 (1989)
Sulo ng Bayan v Araneta, Inc, 72 SCRA 347 (1976)
Saw v CA, 195 SCRA 740 (1991)
Industrial and Dev Corp v Court of Appeals, 272 SCRA 333 (1997)
APT v Court of Appeals, 300 SCRA 579 (1998)
B PIERCING THE VEIL OF CORPORATE FICTION:
1 Source of Incantation
DBP v Court of Appeals, 357 SCRA 626, 358 SCRA 501, 363 SCRA 307 (2001)
2 Nature of Doctrine
Hi- Cement Corp. v. Insular Bank of Asia and America, 534 SCRA 169 (2007)
Pantranco Employees Assn. v. NLRC, 581 SCRA 598 (2009)
General Credit Corp. v. Alsons Dev. & Investment Corp., 513 SCRA 225 (2007)
Situs Development Bank Corp. v. Asiatrust Bank, 677 SCRA 495 (2012)
Traders Royal Bank v Court of Appeals, 269 SCRA 15 [1997]
PNB v Ritratto Group, Inc, 362 SCRA 216 (2001)
Gochan v Young, 354 SCRA 207 (2001)
Rovels Enterprises, Inc v Ocampo, GR No 136821, 17 October 2002
PNB v. Andrada Electric & Engineering Co., 381 SCRA 244 (2002)
NASECO Guards Assn. v. National Service Corp., 629 SCRA 90 (2010)
5 Alter-Ego Cases:
PNB v Andrada Electric & Engineering Co, GR No 142936, 17 April 2002
MR Holdings,Ltd V Bajar, GR No 138104, 11 April 2002
Heirs of Ramon Durano, Sr v Uy, 344 SCRA 238 (2000)
Concept Builders, Inc v NLRC, 257 SCRA 149 (1996)
DBP v Court of Appeals, 363 SCRA 307 (2001)
Arnold v Willets and Patterson, Ltd, 44 Phil 634 (1923)
Tan Boon Bee & Co v Jarencio, 163 SCRA 205 (1988)
First Philippine International Bank v Court of Appeals, 252 SCRA 259 (1996)
La Campana Coffee Factory v Kaisahan ng Manggagawa, 93 Phil 160 (1953)
Azcor Manufacturing, Inc v NLRC, 303 SCRA 26 (1999)
Marvel Building v David, 9 Phil 376 (1951)
Yutivo Sons Hardware v Court of Tax Appeals 1 SCRA 160 (1961); xLiddell & Co v Collector
of Internal Revenue, 2 SCRA 632 (1961)
Ramirez Telephone Corp v Bank of America, 29 SCRA 191 (1969)
Sibagat Timber Corp v Garcia, 216 SCRA 70 (1992)
McConnel v Court of Appeals, 1 SCRA 722 (1961)
Koppel (Phil), Inc v Yatco, 77 Phil 97 (1946); xPHIVIDEC v Court of Appeals, 181 SCRA 669
(1990)
MR Holdings, Ltd V Bajar, GR No 138104, 11 April 2002
Guatson International Travel and Tours, Inc v NLRC, 230 SCRA 815 (1990)
Marubeni Corp v Lirag, 362 SCRA 620 (2001)
Padilla v Court of Appeals, 370 SCRA 208 (2001)
5
6 Equity Cases:
Telephone Engineering and Service Co, Inc V WCC, 104 SCRA 354 (1981)
Emilio Cano Enterprises v CIR, 13 SCRA 291 (1965)
7 Piercing Doctrine and Due Process Clause
Padilla v Court of Appeals, 370 SCRA 208 (2001)
McConnel v Court of Appeals, 1 SCRA 723 (1961)
PCGG v Sandiganbayan, 365 SCRA 538 (2001)
Emilio Cano Enterprises v CIR, 13 SCRA 291 (1965)
Jacinto v Court of Appeals, 198 SCRA 211 (1991)
Arcilla v Court of Appeals, 215 SCRA 120 (1992)
V CLASSIFICATIONS OF CORPORATIONS
1 In Relation to the State:
(a) Public Corporation (Sec 3, Act No 1459)
(b) Quasi-public corporation
Marilao Water Consumers Associates v IAC, 201 SCRA 437 (1991);
(c) Private Corporation (Sec 3, Act 1459)
National Coal Co, v Collector of Internal Revenue, 46 Phil 583 (1924)
Bliss Dev Corp Employees Union v Calleja, 237 SCRA 271 (1994)
Cervantes v Auditor General, 91 Phil 359 (1952)
PNOC-Energy Development Corp v NLRC, 201 SCRA 487 (1991)
Davao City Water District v Civil Service Commission, 201 SCRA 593 (1991)
Camparedondo v NLRC, 312 SCRA 47 (1999)
Boy Scouts of the Philippines v NLRC, 196 SCRA 176 (1991)
Benguet Electric Cooperative, Inc v NLRC, 209 SCRA 55 (1992)
PUP v Court of Appeals, 368 SCRA 691 (2001)
2 As to Place of Incorporation:
(a) Domestic Corporation
(b) Foreign Corporation (Sec 123)
3 As to Purpose of Incorporation:
(a) Municipal Corporation
(b) Religious Corporation (Secs 109 and 116)
Long v Basa, 366 SCRA 113 (2001)
(c) Educational Corporations (Secs 106, 107 and 108; Sec 25, BP Blg 232)
(d) Charitable, Scientific or Vocational Corporations
(e) Business Corporation
4 As to Number of Members:
(a) Aggregate Corporation;
(b) Corporation Sole (Secs 110 to 115)
Roman Catholic Apostolic Administrator of Davao, Inc v LRC and the Register of Deeds of
Davao City, 102 Phil 596 [1957]
Director of Land v IAC, 146 SCRA 509 (1986); see Republic v Villanueva, 114 SCRA 875
(1982) and Republic v Iglesia ni Cristo, 127 SCRA 687 (1984); see also Republic v Iglesia ni
Cristo, 127 SCRA 687 (1984) & Republic v IAC, 168 SCRA 165 (1988)
5 As to Legal Status:
(a) De Jure Corporation
(b) De Facto Corporation (Sec 20)
(c) Corporation by Estoppel (Sec 21)
6 As to Existence of Shares (Secs 3 and 5):
(a) Stock Corporation;
(b) Non-Stock Corporation
VI CORPORATE CONTRACT LAW
1 Pre-Incorporation Contracts
(a) Who Are Promoters? (Sec 310, Securities Regulation Code [RA 8799])
(b) Nature of Pre-incorporation Agreements (Secs 60 and 61)
Bayla v Silang Traffic Co, Inc, 73 Phil 557 [1942]
(c) Theories on Liabilities for Promoter's Contracts
Cagayan Fishing Dev Co, Inc v Teodoro Sandiko, 65 Phil 223 [1937]
Rizal Light & Ice Co, Inc v Public Service Comm, 25 SCRA 285 [1968]
Caram, Jr v CA, 151 SCRA 372 [1987]
2 De Facto Corporation (Sec 20)
(a) Elements for Existence of De Facto Corporation:
(1) Valid law under which incorporated;
(2) Attempt in good faith to incorporate; “colorable compliance”
6
(3) Assumption of corporate powers; and
(4) Issuance of certificate of incorporation
Arnold Hall v Piccio, 86 Phil 634 [1950])
3 Corporation by Estoppel Doctrine (Sec 21)
Salvatierra v Garlitos, 103 Phil 757 [1958]
Albert v University Publishing Co, 13 SCRA 84 [1965]
International Express Travel & Tour Services, Inc v Court of Appeals, 343 SCRA 674 [2000]
Asia Banking Corporation v Standard Products, 46 Phil 145 [1924]
Madrigal Shipping Co, Inc v Ogilvie, Supreme Court Advanced Decision, 55 OG No 35, p 7331)
(a) Nature of the Doctrine
Lozano v De Los Santos, 274 SCRA 452 (1997)
Ohta Dev Co v Steamship Pompey, 49 Phil 117 [1926]
Compania Agricole de Ultramar v Reyes, 4 Phil 1 [1911]
(b) Two Levels: (i) With "fraud;" and (ii) Without "fraud"
People v Garcia, 271 SCRA 621 (1997)
People v Pineda, GR No 117010, 18 April 1997 (unpub)
4 TRUST FUND DOCTRINE
(a) Commercial/Common Law Premise on Equity vis-a-vis Debts (Art 2236, Civil Code)
(b) Nature of Doctrine
Ong v Tiu, GR No 144476-144629, 8 April 2003)
NTC v Court of Appeals, 311 SCRA 508 (1999)
Boman Environmental Dev Corp v CA, 167 SCRA 540 (1988)
Comm of Internal Revenue v Court of Appeals, 301 SCRA 152 (1999)
(c) To Purchase Own Shares (Secs 8, 41, 43 and 122, last paragraph
Phil Trust Co v Rivera, 44 Phil 469 [1923]
Steinberg v Velasco, 52 Phil 953 [1929]
VII ARTICLES OF INCORPORATION
1. Nature of Charter
2. Government of PI v Manila Railroad Co, 52 Phil 699 (1929)
2 Procedure and Documentary Requirements (Sec 14 and 15)
(a) As to Number and Residency of Incorporators (Sec 10);
(b) Corporate Name (Secs 18, 14(1) and 42;
Red Line Trans v Rural Transit, 60 Phil 549 [1934])
Ang Mga Kaanib sa Iglesia ng Dios Kay Kristo Hesus v Iglesia ng Dios Kay
Cristo Jesus, 372 SCRA 171 (2001)
Universal Mills Corp v Universal Textile Mills Inc, 78 SCRA 62 [1977]
Industrial Refractories Corp v Court of Appeals, 3 October 2002
Lyceum of the Philippines v Court of Appeals, 219 SCRA 610, 615 (1993)
Laureano Investment and Dev Corp v Court of Appeals, 272 SCRA 253 (1997)
Pison-Arceo Agricultural Dev Corp v NLRC, 279 SCRA 312 (1997)
Philippine First Insurance Co v Hartigan, 34 SCRA 252 (1970)
Republic Planters Bank v Court of Appeals, 216 SCRA 738 (1992)
(c) Purpose Clause (Secs 14(2) and 42
Uy Siuliong v Director of Commerce and Industry, 40 Phil 541 [1919]
(d) Corporate Term (Sec 11)
Alhambra Cigar v SEC, 24 SCRA 269 (1968)
(e) Principal Place of Business
Clavecilla Radio System v Antillon, 19 SCRA 379 (1967)
Sy v Tyson Enterprises, Inc, 119 SCRA 367 (1982)
(f) Minimum Capitalization (Sec 12)
Why is maximum capitalization required to be indicated?
(g) Subscription and Paid-up Requirements (Sec 13)
(h) Steps and Documents Required in SEC
3 Grounds for Disapproval (Sec 17)
Asuncion v De Yriarte, 28 Phil 67 (1914)
4 Amendments to the Articles of Incorporation (Sec 16)
5 Commencement of Corporate Existence (Sec 19)
VIII BY-LAWS
1. Nature and Functions
Gokongwei v SEC, 89 SCRA 337 [1979]
Peña v CA, 193 SCRA 717 [1991]
Loyola Grand Villas Homeowners (South) Assn, Inc v Court of Appeals, 276 SCRA 681 (1997)
(a) Common Law Limitations on By-Laws
7
(i) By-Laws Cannot Be Contrary to Law and Articles of Incorporation
Grace Christian High School v Court of Appeals, 281 SCRA 133 (1997)
(ii) By-Law provisions cannot be unreasonable or be contrary to the nature of by-
laws
Government of PI v El Hogar Filipino, 50 Phil 399 (1927)
Thomson v Court of Appeals, 298 SCRA 280 (1998)
Rural Bank of Salinas, Inc v CA, 210 SCRA 510 (1992)
Salafranca v Philamlife (Pamplona) Village Homeowners Assn, 300 SCRA 469 (1998)
(iii) By-Law provisions cannot discriminate
(b) Binding Effects on By-laws
China Banking Corp v Court of Appeals, 270 SCRA 503 [1997]
PMI Colleges v NLRC, 277 SCRA 462 (1997)
2 Adoption Procedure (Sec 46)
Loyola Grand Villas Homeowners (South) Association, Inc v Court of Appeals, 276 SCRA 681
(1997)
3 Contents (Sec 47)
4 Amendments (Sec 48)
Power to amend may be delegated to the board of directors
13
11 Contracts and Agreement Affecting Shareholdings
(a) Proxy (Sec 58)
(b) Voting Trust Agreements (Sec 59)
Lee v CA, 205 SCRA 752 [1992])
Everett v Asia Banking Corporation, 49 Phil 512 (1926)
NIDC v Aquino, 163 SCRA 153 (1988)
(c) Pooling Agreements or Shareholders’ Agreements (Sec 100)
3 Business Enterprise Transfers (4AD Santos v Vasquez, 22 SCRA 1156 [1968]; 4Laguna
Transportation Co, Inc v SSS, 107 Phil 833 [1960])
14
Although the business enterprise was operated under a partnership scheme and
latter the business was transferred to a corporation, the business enterprise is deemed to
have been in operation for the required two-year period as to come under the coverage of
the SSS Law xSan Teodoro Dev v SSS, 8 SCRA 96 (1963)
Where a new corporation continues the business of the partnership, and even when
the latter is dissolved stating as the reason thereof was the desire of its partners to have a
corporation take over to expand business operations, and since the corporation assumed
all the assets and liabilities of the partnership, then the corporation cannot be regarded,
for purposes of the SSS Law, as having come into being only on the date of its
incorporation but from the date the partnership started the business xOromeca Lumber
Co v SSS, 4 SCRA 1188 (1962)
Although a corporation may have ceased business operations and an entirely new
company has been organized to take over the same type of operations, it does not
necessarily follow that no one may now be held liable for illegal acts committed by the
earlier firm 4Pepsi-Cola Bottling Co, v NLRC, 210 SCRA 277 (1992)
“It should be rather clear that, as between the estate and the corporation, the
intention of incorporation was to make the corporation liable for past and pending
obligations of the estate as the transportation business itself was being transferred to and
placed in the name of the corporation That liability on the part of the corporation, vis-à-
vis the estate, should continue to remain with it even after the percentage of the estate’s
shares of stock in the corporation should be diluted” 4Buan v Alcantara, 127 SCRA 845
(1984)
4 Equity Transfers (4Phividec v Court of Appeals, 181 SCRA 669 [1990])
The fact that instead on foreclosing on the mortgaged assets, DBP converted its
loans to equity, making it the controlling stockholder of a bank, and although the
majority of the members of the board of directors of the bank are from DBP, the same
does not make DBP an employer of the bank employees, nor does it make DBP liable for
the wage claims of the bank's employees xDBP v NLRC, 186 SCRA 841 (1990)
5 Aspects as to Employees (4Complex Electronics Employees Assn v NLRC, 310 SCRA 403
[1999])
2 Procedure:
(a) Plan of Merger or Consolidation (Sec 76)
(b) Stockholders' or Members' Approval (Sec 77)
(c) Articles of Merger or Consolidation (Sec 78)
(d) Approval by SEC (Sec 79)
Submission of Financial Statements Requirements
For applications of merger, the audited financial statements of the constituent
corporations (surviving and absorbed) as of the date not earlier than 120 days prior to the
date of filing of the application and the long-form audit report for absorbed corporation(s) are
always required Long form audit report for the surviving corporation is required if it is
insolvent In addition, the following are required in the processing of the application:
(a) List of creditors of the absorbed corporations;
(b) List of creditors of insolvent surviving corporation;
(c) Consent of creditors of insolvent constituent corporation;
(d) List of stockholders of record of the constituent corporations;
(e) Affidavit of publication; and
(f) Company data maintenance form (SEC Opinion 14, s of 2002, 15 November 2002)
3 Effects of Merger or Consolidation (Sec 80; Associated Bank v Court of Appeals, 291
SCRA 511 [1998])
When the procedure for merger or consolidation prescribed under Title IX of the
Corporation Code are not followed, there can be no merger or consolidation, and
15
corporate separateness between the constituent corporations remains, and the liabilities
of one entity cannot be enforced against another entity xPNB v Andrada Electric &
Engineering Co, GR No 142936, 17 April (2002)
It is settled that in the merger of two existing corporations, one of the corporations
survives and continues the business, while the other is dissolved and all its rights,
properties and liabilities are acquired by the surviving corporation The surviving
corporation therefore has a right to institute a collection suit on accounts of one of one of
the constituent corporations xBabst v Court of Appeals, 350 SCRA 341 (2001)
16