G.R. No. 202639, 9 November 2016
Petitioner, sought the assistance of CIDG-AFCCD informing the latter of its confirmation ACCS Ideal Gas Corporation (ACCS), allegedly has been refilling branded LPG cylinders without authority to refill per certifications from gas companies owning the branded LPG cylinders, in violation of Batas Pambansa Blg. 33 (BP 33),4 as amended by Presidential Decree No. 1865 (PD 1865).
After a successful search and seizure operations, Complaints-Affidavits against Antonio and respondents for illegal trading of petroleum products and for underfilling of LPG cylinders under Section 2(a) and 2(c), respectively, of BP 33, as amended.
Respondents, filed a Joint Counter-Affidavits interposing that they were merely incorporators/stockholders of ACCS who have no active participation in the operation, management, and control of the business; that ACCS was only engaged in the distribution of LPG products and not in the refilling of LPG cylinders; and, that ACCS did not commit any violation of BP 33 as amended.
Can respondents, as members of the Board of Directors of ACCS, be criminally prosecuted for the latter’s alleged violation/s of BP 33 as amended.
No.As clearly enunciated in Ty v. NBI Supervising Agent De Jemil, a member of the Board of Directors of a corporation, cannot, by mere reason of such membership, be held liable for corporation’s probable violation of BP 33. If one is not the President, General Manager or Managing Partner, it is imperative that it first be shown that he/she falls under the catch-all “such other officer charged with the management of the business affairs,” before he/she can be prosecuted.
Here, there is no dispute that neither of the respondents was the President, General Manager, or Managing Partner of ACCS. Hence, it becomes incumbent upon petitioner to show that respondents were officers charged with the management of the business affairs. However, the Complaint-Affidavit attached to the records merely states that respondents were members of the Board of Directors based on the AOI of ACCS. There is no allegation whatsoever that they were in-charge of the management of the corporation’s business affairs.
At any rate, the Court has gone through the By-Laws of ACCS and found nothing therein which would suggest that respondents were directly involved in the day-to-day operations of the corporation. It is actually the President under Section 2,41 Article IV of the said by-laws who is vested with wide latitude in controlling the business operations of the corporation.
Among others, the President is specifically empowered to supervise and manage the business affairs of the corporation, to implement the administrative and operational policies of the corporation under his supervision and control, to appoint, remove, suspend or discipline employees of the corporation, prescribe their duties, and determine their salaries. With these functions, the President appears to be the officer charged with the management of the business affairs of ACCS.
But since there is no allegation or showing that any of the respondents was the President of ACCS, none of them, therefore, can be considered as an officer charged with the management of the business affairs.
Respondents then who were mere members of the Board of Directors and not shown to be charged with the management of the business affairs were thus correctly dropped as respondents in the complaint.
*Case Digest by Nikki P. Ebillo, JD-4, Andres Bonifacio Law School, SY 2019-2020