The mere fact that one is president of the corporation does not render the

The mere fact that one is president of the

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The mere fact that one is president of the corporation does not render the property he owns or possesses the property of the corporation, since that president, as an individual, and the corporation are separate entities. ( Cruz v. Dalisay , 152 SCRA 487 (1987); Booc v. Bantuas, 354 SCRA 279 [2001]). CORPORATE JURIDICAL PERSONALITY
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The tax exemption clause in the charter of a corporation cannot be extended to nor enjoyed by even its controlling stockholders. ( Manila Gas Corp. v. Collector of Internal Revenue , 62 Phil. 895 (1936). Corporate debt or credit is not the debt or credit of the stockholder nor is the stockholder's debt or credit that of the corporation. ( Traders Royal Bank v. Court of Appeals , 177 SCRA 789 [1989]). A corporation has no legal standing to file a suit for recovery of certain parcels of land owned by its members in their individual capacity, even when the corporation is organized for the benefit of the members. ( Sulo ng Bayan v. Araneta, Inc ., 72 SCRA 347 [2001]). CORPORATE JURIDICAL PERSONALITY
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General Rule : A corporation cannot be generally held liable for acts or liabilities of its stockholders or members, and vice versa because a corporation has a personality separate and distinct from its members or stockholders. Exception : The corporate existence is disregarded when the corporation is formed or used for illegitimate purposes, particularly, as a shield to perpetuate fraud, defeat public convenience, justify wrong, evade a just and valid obligation or defend a crime. DOCTRINE OF PIERCING THE VEIL OF CORPORATE PERSONALITY
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The notion of corporate entity will be pierced or disregarded and the individuals composing it will be treated as identical if the corporate entity is being used as a cloak or cover for fraud or illegality; as a justification for a wrong; or as an alter ego, an adjunct, or a business conduit for the sole benefit of the stockholders. ( Gochan v. Young , 354 SCRA 207 [2001]; DBP v. Court of Appeals , 357 SCRA 626, 358 SCRA 501, 363 SCRA 307 [2001]). In the cases of fraud, the piercing is done because there is a wrong committed . Therefore, a person behind the wrong must be held liable which in a corporation are the directors, since the corporation acts through them. A piercing of the corporate veil in fraud cases is for the purpose of making the directors directly liable . DOCTRINE OF PIERCING THE VEIL OF CORPORATE PERSONALITY
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Public Corporation (Sec. 3, Act No. 1459) - one formed or organized for the government or a portion of the state; its purpose is for general good and welfare Private Corporation (Sec. 3, Act 1459). - one formed for some private purpose, benefit or end. Government s majority shares does not make an entity a public corporation. ( National Coal Co., v. Collector of Internal Revenue , 46 Phil. 583 [1924]). A corporation is created by operation of law under the Corporation Code while a government corporation is normally created by special law referred to often as a charter. ( Bliss Dev. Corp. Employees Union v. Calleja, 237 SCRA 271 [1994]). CLASSES OF CORPORATION IN RELATION TO THE STATE
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Domestic Corporation - incorporated in the Philippines Foreign Corporation - incorporated in another country and that country grants the same rights to Filipinos in terms of doing business there Sec. 123 Definition and rights of foreign corporations For the purposes of this Code,
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  • Fall '19
  • Gilbert R. Huafana

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