Professional Documents
Culture Documents
SUPREMECOURTREPORTSANNOTATEDVOLUME401
1/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
3
2/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
3/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
4/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
Ong Yong, et al. vs. Tiu, et al., G.R. No. 144476 Tiu, et al. vs. Ong
5/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
The testimony of Wilson Ong, never refuted by the Tius, was that the
6/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
tuted by the Lichaucos from whom the Tius bought it. The
Ongs later on discovered that FLADC had in reality owned
the property all along, even before their PreSubscription
Agreement was executed in 1994. This meant that the 151
squaremeter property was at that time already the
corporate property of FLADC for which the Tius were not
entitled to the issuance of new shares of stock.
The controversy
finally came to a head when this case
4
was commenced by the Tius on February 27, 1996 at the
Securities and Exchange Commission (SEC), seeking
confirmation of their rescission of the PreSubscription
Agreement. After hearing, the SEC, through then Hearing
Officer Rolando G. Andaya, Jr., issued a decision on May
19, 1997 confirming the rescission sought by the Tius, as
follows:
WHEREFORE, judgment is hereby rendered confirming the
rescission of the PreSubscription Agreement, and consequently
ordering:
(a) The cancellation of the 1,000,000 shares subscription of
the individual defendants in FLADC
http://www.central.com.ph/sfsreader/session/000001576fef9d98152e5497003600fb002c009e/t/?o=False
7/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
SO ORDERED.
http://www.central.com.ph/sfsreader/session/000001576fef9d98152e5497003600fb002c009e/t/?o=False
Both parties appealed to the SEC en
banc which
8/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
7
9/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
SO ORDERED.
10
10
10/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
Supreme Court Decision dated February 1, 2002, pp. 3435 Rollo, pp.
299300.
11
11
11/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
12/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
12
13/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
13
14/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
14
15/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
14
Estrada vs. Sto. Domingo, 28 SCRA 890 [1969] Cruz vs. Tuazon &
Co., Inc., 76 SCRA 543 [1977]) Llanter vs. Court of Appeals, 105 SCRA
609 [1981] Luzon Brokerage Co., Inc. vs. Maritime Building Co., Inc., 86
SCRA 305 [1978].
13
14
Id., at p. 221.
15
15
16/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
16
17/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
17
tract between the Tius, the Ongs and FLADC regarding the
subscription of the parties to the corporation. They point
out that these two component parts form one whole
agreement and that their terms and conditions are
intrinsically related and dependent on each other. Thus,
the breach of the shareholders agreement, which was
allegedly the consideration for the subscription contract,
was also a breach of the latter.
Aside from the fact that this is an entirely new angle
never raised in any of their previous pleadings until after
the oral arguments on January 29, 2003, we find this
argument too strained for comfort. It is obviously intended
to remedy and cover up the Tius lack of legal personality to
rescind an agreement in which they were personally not
partiesininterest. Assuming arguendo that there were two
subagreements embodied in the PreSubscription
http://www.central.com.ph/sfsreader/session/000001576fef9d98152e5497003600fb002c009e/t/?o=False
18/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
18
19/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
20
21
19
20/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
Environmental Devt. Corp. vs. Court of Appeals, 167 SCRA 540 [1988].
24
20
20
21/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
SEC. 41. Power to acquire own shares.A stock corporation shall have the power
to purchase or acquire its own shares for a legitimate corporate purpose or
purposes, including but not limited to the following cases: Provided, That the
corporation has unrestricted retained earnings in its books to cover the shares to
be purchased or acquired:
(1) To eliminate fractional shares arising out of stock dividends
(2) To collect or compromise an indebtedness to the corporation, arising out of
unpaid subscription, in a delinquency sale, and to purchase delinquent
shares sold during said sale and
(3) To pay dissenting or withdrawing stockholders entitled to payment for
their shares under the provisions of this Code. (Italics supplied)
27
xxxxxxxxx
21
21
http://www.central.com.ph/sfsreader/session/000001576fef9d98152e5497003600fb002c009e/t/?o=False
22/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
Sections 117, 118, 119, and 120 of the Corporation Code provide that:
22
22
http://www.central.com.ph/sfsreader/session/000001576fef9d98152e5497003600fb002c009e/t/?o=False
23/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
23
23
24/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
24
http://www.central.com.ph/sfsreader/session/000001576fef9d98152e5497003600fb002c009e/t/?o=False
25/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
http://www.central.com.ph/sfsreader/session/000001576fef9d98152e5497003600fb002c009e/t/?o=False
26/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
with nothing but the money they had in 1994 while the
Tius will not
_______________
29
30
25
27/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
26
28/29
9/28/2016
SUPREMECOURTREPORTSANNOTATEDVOLUME401
27
Copyright2016CentralBookSupply,Inc.Allrightsreserved.
http://www.central.com.ph/sfsreader/session/000001576fef9d98152e5497003600fb002c009e/t/?o=False
29/29