G.R. No. 184008, 3 August 2016

FACTS:

Filipino-Indian Chamber of Commerce of the Philippines, Inc. (defunct FICCPI) was originally registered with the SEC as Indian Chamber of Commerce of Manila, Inc. on November 24, 1951. On October 7, 1959, it amended its corporate name into Indian Chamber of Commerce of the Philippines, Inc., and further amended it into Filipino-Indian Chamber of Commerce of the Philippines, Inc. on March 4, 1977 Pursuant to its Articles of Incorporation, and without applying for an extension of its corporate term, the defunct FICCPI’s term of existence expired on November 24, 2001.

On January 20, 2005, Mr. Naresh Mansukhani (Mansukhani) reserved the corporate name “Filipino Indian Chamber of Commerce in the Philippines, Inc.” (FICCPI), for the period from January 20, 2005 to April 20, 2005, with the Company Registration and Monitoring Department (CRMD) of the SEC. In an opposition letter dated April 1, 2005, Ram Sitaldas (Sitaldas), claiming to be a representative of the defunct FICCPI, alleged that the corporate name has been used by the defunct FICCPI since 1951, and that the reservation by another person who is not its member or representative is illegal.

Subsequently, on May 27, 2005, the CRMD rendered a decision granting Mansukhani’s reservation, holding that he possesses the better right over the corporate name. The CRMD ruled that the defunct FICCPI has no legal personality to oppose the reservation of the corporate name by Mansukhani. Thus, the name “Filipino Indian Chamber of Commerce in the Philippines, Inc.” is free for appropriation by any party.

Sitaldas appealed the decision of the CRMD to the SEC En Banc, which denied it. The CA affirmed the decision of the SEC En Banc.On March 14, 2006, pending resolution by the CA, the SEC issued the Certificate of Incorporation of respondent FICCPI.

Meanwhile, on December 8, 2005, Mr. Pracash Dayacanl, who allegedly represented the defunct FICCPI, filed an application with the CRMD for the reservation of the corporate name “Indian Chamber of Commerce Phils., Inc.” (ICCPI). Upon knowledge, Mansukhani, in a letter dated February 14, 2006, formally opposed the application.

In a letter dated April 5, 2006, the CRMD denied Mansukhani’s opposition. It stated that the name “Indian Chamber of Commerce Phils., Inc.” is not deceptively or confusingly similar to “Filipino Indian Chamber of Commerce in the Philippines, Inc.” On the same date, the CRMD approved and issued the Certificate of Incorporation of petitioner ICCPI.

Thus, respondent FICCPI, through Mansukhani, appealed the CRMD’s decision to the SEC En Banc which was granted and was affirmed by the CA. Hence, this petition.

ISSUE:

Whether the name “Indian Chamber of Commerce Phils., Inc.” is deceptively similar with“Filipino Indian Chamber of Commerce in the Philippines, Inc.”

RULING:

Yes. Section 18 of the Corporation Code expressly prohibits the use of a corporate name which is identical or deceptively or confusingly similar to that of any existing corporation:

No corporate name may be allowed by the Securities and Exchange Commission if the proposed name is identical or deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law or is patently deceptive, confusing or contrary to existing laws. When a change in the corporate name is approved, the Commission shall issue an amended certificate of incorporation under the amended name.

In Philips Export B. V. v. Court of Appeals, this Court ruled that to fall within the prohibition, two requisites must be proven, to wit: that the complainant corporation acquired a prior right over the use of such corporate name; and the proposed name is either:(a) identical; or (b) deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law; or (c) patently deceptive, confusing or contrary to existing law.

These two requisites are present in this case.

In this case, FICCPI was incorporated on March 14, 2006. On the other hand, ICCPI was incorporated only on April 5, 2006, or a month after FICCPI registered its corporate name. Thus, applying the principle in the Refractories case, we hold that FICCPI, which was incorporated earlier, acquired a prior right over the use of the corporate name.

ICCPI cannot argue that it first incorporated and held the “Filipino Indian Chamber of Commerce,” in 1977; and that it established the name’s goodwill until it failed to renew its name due to oversight. It is settled that a corporation is ipso facto dissolved as soon as its term of existence expires. SEC Memorandum Circular No. 14-2000 likewise provides for the use of corporate names of dissolved corporations: The name of a dissolved firm shall not be allowed to be used by other firms within three (3) years after the approval of the dissolution of the corporation by the Commission, unless allowed by the last stockholders representing at least majority of the outstanding capital stock of the dissolved firm.

ICCPI’s corporate name is deceptively or confusingly similar to that of FICCPI. It is settled that to determire the existence of confusing similarity in corporate names, the test is whether the similarity is such as to mislead a person, using ordinary care and discrimination. In so doing, the court must examine the record as well as the names themselves. Proof of actual confusion need not be shown. It suffices that confusion is probably or likely to occur.

In this case, the overriding consideration in determining wheiher a person, using ordinary care and discrimination, might be misled is the circumstance that both ICCPI and FICCPI have a common primary purpose, that is, the promotion of Filipino-Indian business in the Philippines.

*Case Digest by Bryne Angelo M. Brillantes, JD-IV, Andres Bonifacio Law School, SY 2019-2020