G.R. No. 211108, 7 June 2017
Barangay Mulawin Tricycle Operators and Drivers Association, Inc. (BMTODA) is a corporation duly registered with the Securities and Exchange Commission (SEC).
Oscar Ongjoco (Ongjoco), a member of BMTODA, learned that BMTODA’s funds were missing. In a letter, Ongjoco requested copies of the Association’s documents pursuant to his right to examine records under Section 74 of the Corporation Code of the Philippines (Corporation Code). However, Singson, the Secretary of BMTODA, denied his request.
Ongjoco also learned that the incumbent officers were holding office for three years already, in violation of the one-year period provided for in BMTODA’s by-laws. He then requested from Roque, the President of BMTODA, a copy of the list of its members with the corresponding franchise numbers of their respective tricycle fees and the franchise fees paid by each member, but Roque denied Ongjoco’s request.
This prompted the latter to file a complaint against Roque and Singson for violation of Section 74 in relation to Section 144 of the Corporation Code.
The RTC ruled that said association failed to prove its existence as a corporation. This was reversed on appeal finding that BMTODA is a duly registered corporation.
Petitioner contends that there is want of evidence to prove that BMTODA is a corporation duly established and organized under the Corporation Code; thus, he cannot be prosecuted under the penal provisions of the said code.
Whether petitioner is guilty of violating Section 74 in relation to Section 144 of the Corporation Code.
Yes.While it appears that the registration of BMTODA as a corporation with the SEC was revoked on September 30, 2003, the letter-request of Ongjoco to Singson, which was dated while BMTODA’s registration was revoked, was actually received by Singson after the revocation was lifted. In a Letter dated October 11, 2004, the General Counsel of the SEC made it clear that the SEC lifted the revocation of BMTODA’s registration on August 30, 2004. As the CA correctly observed, the letter-request was received by Singson on September 23, 2004 when BMTODA had regained its active status.
In any case, the revocation of a corporation’s Certificate of Registration does not automatically warrant the extinction of the corporation itself such that its rights and liabilities are likewise altogether extinguished. In the case of Clemente v. Court of Appeals, the Court explained that the termination of the life of a juridical entity does not, by itself, cause the extinction or diminution of the rights and liabilities of such entity nor those of its owners and creditors.
Thus, the revocation of BMTODA’s registration does not automatically strip off Ongjoco of his right to examine pertinent documents and records relating to such association.
Also, since Roque admitted the revocation of BMTODA’s registration he cannot come forward and disclaim BMTODA’s registration with the SEC as a corporation. It is logical to presume that a registration precedes the revocation thereof; as any registration cannot be revoked without its valid existence.
For his individual and separate act, Roque should be held accountable. Hence, Roque’s denial is unquestionably considered as a violation under the Corporation Code.
*Case Digest by Nikki P. Ebillo, JD-4, Andres Bonifacio Law School, SY 2019-2020