BOYER – ROXAS VS.

COURT OF APPEALS 211 SCRA 470 (1992)

FACTS OF THE CASE

When Eugenia V. Roxas died, her heirs formed a corporation under the name and style of Heirs of Eugenia V. Roxas, Inc. using her estate as the

capital of the corporation, the private respondent herein.

It was primarily engaged in agriculture business, however it amended its purpose to enable it to engage in resort and restaurant business.

Petitioners are stockholders of the corporation and two of the heirs of Eugenia. By tolerance, they were allowed to occupy some of the properties

of the corporation as their residence.

However, the board of directors of the corporation passed a resolution evicting the petitioners from the property of the corporation because the

same will be needed for expansion.

At the RTC, private respondent presented its evidence averring that the subject premises are owned by the corporation.

Petitioners failed to present their evidence due to alleged negligence of their counsel.

RTC handed a decision in favor of private respondent.

Petitioners appealed to the Court of Appeals but the latter denied the petition and affirmed the ruling of the RTC.

Hence, they appealed to the Supreme Court. In their appeal, petitioners argues that the CA made a mistake in upholding the decision of the RTC,

and that their occupancy of the subject premises should be respected because they own an aliquot part of the corporation as stockholders, and that

the veil of corporate fiction must be pierced by virtue thereof.

ISSUE

1. Whether petitioner’s contention were correct as regards the piercing of the corporate veil.

2. Whether petitioners were correct in their contention that they should be respected as regards their occupancy since they own an aliquot part of

the corporation.

RULING

1.Petitioner’s contention to pierce the veil of corporate fiction is untenable. As aptly held by the court: “..The separate personality of a corporation

may ONLY be disregarded when the corporation is used as a cloak or cover for fraud or illegality, or to work injustice, or when necessary to

achieve equity or when necessary for the protection of creditors.”

2. As regards petitioners contention that they should be respected on their occupancy by virtue of an aliquot part they own on the corporation as

stockholders, it also fails to hold water. The court held that “properties owned by a corporation are owned by it as an entity separate and distinct

from its members. While shares of stocks are personal property, they do not represent property of the corporation. A share of stock only typifies

an aliquot part of the corporation’s property, or the right to share in its proceeds to that extent when distributed according to law and equity, but

its holder is not the owner of any part of the capital of the corporation. Nor is he entitled to the possession of any definite portion of its property

or assets. The holder is not a co-owner or a tenant in common of the corporate property.”