DOCTRINE ON CORPORATE JURIDICAL PERSONALITY

□ APPLY THE DOCTRINE OF CORPORATE JURIDICAL PERSONALITY

○ DOCTRINE OF SEPARATE JURIDICAL PERSONALITY- means that a corporation has a

personality separate and distinct from the stockholder and affiliated companies.

▪ Liability for torts and crimes

Is a corporation can be held liable?

Torts Crime
GR: Yes GR: No
• Tortuous act • It cannot be held criminally
committed by an liable, for a crime committed
officer or agent under by officers, particularly the
the express direction or penalty of imprisonment.
authority of the stock • In such case, the responsible
holder or members officer would be criminally
acting a body, or liable.
generally, from the
directors as the
governing body.
EXC:
• it may held liable for fines
for corporate crimes or
forfeiture of franchise or
license.

▪ Recovery for damages

Can a corporation recover damages?

GENERAL RULE: Yes

EXCEPTION: Moral damages
EXC:
• can recover moral
damages in cases of
a. Libel
b. Slander
c. Any other form of
defamation; or
d. When reputation of
corporation has
been debased,
resulting to
humiliation in its
business realm.

○ DOCTRINE OF PIERCING THE VEIL OF CORPORATE FICTION- a doctrine that disregard the
separate personality of a corporation if this separate personality is used as an Alter ego of
another entity, and was used to justify wrong, protect fraud, perpetrate deception, or
defeat public convenience.

▪ 3 Basic Areas: (D.F.A)

1) D- Defeat Public Convenience Cases

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1) D- Defeat Public Convenience Cases
→ When the corporate fiction is used to commit evasion of an existing
obligation
2) F- Fraud Cases
→ When the corporate fiction is used to
 Protect Fraud
 Justify a wrong
 Defend a crime
3) A- Alter Ego Cases
→ When a corporation is a mere instrumentality or alter ego of the
stockholders or owners

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