corpo digest batch 1 (2)

8/10/2019 Corpo Digest Batch 1 (2)

1/23

MANILA INTERNATIONAL AIRPORT AUTHORITY vs. COURT OF APPEALS

G.R. No. 155650 July 20 2006

FACTS!

Petitioner Manila International Airport Authority (MIAA) operates the Ninoy AquinoInternational Airport (NAIA) Complex in Paraaque City under Executive Order No !"#$other%ise &no%n as the 'evised Charter o the Manila International Airport Authority (MIAACharter) *he O+CC opined that the ,ocal +overnment Code o -!!- %ithdre% the exemptionrom real estate tax .ranted to MIAA under /ection 0- o the MIAA Charter MIAA received 1inalNotices o 'eal Estate *ax 2elinquency rom the City o Paraaque or the taxa3le years -!!0to 0""- *hereater$ the City o Paraaque$ throu.h its City *reasurer$ issued notices o levy and%arrants o levy on the Airport ,ands and 4uildin.s *he Mayor o the City o Paraaquethreatened to sell at pu3lic auction the Airport ,ands and 4uildin.s should MIAA ail to pay thereal estate tax delinquency MIAA iled %ith the Court o Appeals an ori.inal petition orprohi3ition and in5unction$ %ith prayer or preliminary in5unction or temporary restrainin. order*he Court o Appeals dismissed the petition 3ecause MIAA iled it 3eyond the 6"7dayre.lementary period

ISSUE!

8hether the Airport ,ands and 4uildin.s o MIAA are exempt rom real estate tax

HEL"!

*he Court held that MIAA9s Airport ,ands and 4uildin.s are exempt rom real estate taximposed 3y local .overnments 1irst$ MIAA is not a .overnment o%ned or controlled corporation3ut an #$s%&u'($%)l#%y o* %+( N)%#o$)l Gov(&$'($%and thus exempt rom local taxation

/econd$ the real properties o MIAA are o,$(- y %+( R(/ul# o* %+( P+#l#//#$(sand thusexempt rom real estate tax *here is no dispute that a .overnment7o%ned or controlledcorporation is not exempt rom real estate tax :o%ever$ MIAA is not a .overnment7o%ned orcontrolled corporation A .overnment7o%ned or controlled corporation must 3e or.ani;ed as astoc& or non7stoc& corporation MIAA is not or.ani;ed as a stoc& or non7stoc& corporationMIAA is not a stoc& corporation 3ecause it has no capital stoc& divided into shares MIAA has nostoc&holders or votin. shares :ence$ MIAA is not a stoc& corporation MIAA is also not a non7stoc& corporation 3ecause it has no mem3ers A non7stoc& corporation must have mem3ersEven i %e assume that the +overnment is considered as the sole mem3er o MIAA$ this %ill notma&e MIAA a non7stoc& corporation Non7stoc& corporations cannot distri3ute any part o theirincome to their mem3ers /ection -- o the MIAA Charter mandates MIAA to remit 0"< o itsannual .ross operatin. income to the National *reasury*his prevents MIAA rom qualiyin. as a

non7stoc& corporation /ince MIAA is neither a stoc& nor a non7stoc& corporation$ MIAA doesnot qualiy as a .overnment7o%ned or controlled corporation MIAA #s ) ov(&$'($%#$s%&u'($%)l#%y v(s%(- ,#%+ o&/o&)%( /o,(&s to perorm eiciently its .overnmentalunctions MIAA is li&e any other .overnment instrumentality$ the only dierence is that MIAA isvested %ith corporate po%ers 8hen the la% vests in a .overnment instrumentality corporatepo%ers$ the instrumentality does not 3ecome a corporation =nless the .overnmentinstrumentality is or.ani;ed as a stoc& or non7stoc& corporation$ it remains a .overnmentinstrumentality exercisin. not only .overnmental 3ut also corporate po%ers


2/23

MIAA is merely holdin. title to the Airport ,ands and 4uildin.s in trust or the 'epu3lic/ection >?$ Chapter -0$ 4oo& I o the Administrative Code allo%s instrumentalities li&e MIAA tohold title to real properties o%ned 3y the 'epu3lic

/ection 0#>(a) o the ,ocal +overnment Code exempts rom real estate tax any realproperty o%ned 3y the 'epu3lic o the Philippines@ *his exemption should 3e read in relation

%ith /ection -##(o) o the same Code$ %hich prohi3its local .overnments rom imposin.tBaxes$ ees or char.es o any &ind on the National +overnment$ its a.encies and#$s%&u'($%)l#%#(s x x x

/ection 0#>(a) o the ,ocal +overnment Code states that real property o%ned 3y the'epu3lic loses its tax exemption only i the 3eneicial use thereo has 3een .ranted$ orconsideration or other%ise$ to a taxa3le person MIAA )s ) ov(&$'($% #$s%&u'($%)l#%y #s$o% ) %))l( /(&so$ under /ection -##(o) o the ,ocal +overnment Code *hus$ even i %eassume that the 'epu3lic has .ranted to MIAA the 3eneicial use o the Airport ,ands and4uildin.s$ such act does not ma&e these real properties su35ect to real estate tax

:o%ever$ portions o the Airport ,ands and 4uildin.s that MIAA l()s(s %o /v)%(($%#%#(sare not exempt rom real estate tax


3/23

Magsaysay-Labrador v Court of Appeals180 SCRA 267 19 Dee!ber 1989"er#a#$ C%&%'

"ats' Adelaida Rodriguez-Magsaysay, widow and special administratix of theestate of the late senator Genaro Magsaysay, brought before the CF of !longapo,an action against Artemio "anganiban, #$%C, F&MA'%A'(, and the Register of)eeds of *ambales+ #he alleged that in ./, she and her husband ac0uiredthrough con1ugal funds, a parcel of land with impro2ements, 3nown as 4"e0ue5asland67 that after the death of her husband, she disco2ered an annotation at thebac3 of 8C8 'o 9:./ that 4the land was ac0uired by her husband from his separatecapital6, the Registration of )eed of Assignment purportedly executed by the late#enator in fa2or of #$%C was cancelled and 8C8 'o+ ::;9 issued in the name of#$%C7 and the registration of )eed of Mortgage executed by #$%C in fa2or ofF&MA'%A'(7 that the foregoing acts were 2oid and done in attempt to defraudcon1ugal partnership considering that the land is con1ugal, her marital consent to

the annotation was not obtained+ #he prayed that the )eed of Mortgage and the)eed of Assignment be annulled and that the Register of )eeds be ordered tocancel 8C8 'o ::;9 and to issue a new title in her fa2or+

of the total outstanding shares of such stoc3sin #$%C+

8he court denied the Motion for nter2ention, and ruled that petitioners ha2eno legal interest+ !n appeal, the respondent CA found no factual or legal

1usti=cation to disturb the =ndings of the lower court+"etitioners strongly argue that their ownership of ;+??> of the entire capital

stoc3 of #$%C entitles them to a signi=cant 2ote in the corporate a@airs7 that they

are a@ected by the action of the widow of their late brother for it concerns onlytangible assets of the corporation and it appears that they are ore 2itally interestedin the outcome of the case than #$%C+

(ssue' )*et*er pet+t+o#ers *ave legal +#terest +# t*e sub,et !atter +#l+t+gat+o#

Rul+#g' o%"etitioners ha2e no legal interest in the sub1ect matter in litigation soas to entitle them to inter2ene+ As clearly stated in section :, Rule : of the Rules ofCourt, to be permitted to inter2ene in a pending action, the party must ha2e legalinterest in the matter in litigation+

8he words 4an interest o2er the sub1ect6 mean a direct interest in the cause

of action as pleaded and which would put the inter2enor in a legal position tolitigate a fact alleged in the complaint, without establishment of which plainti@could not reco2er+


4/23

hile a share of stoc3 represents a proportionate or ali0uot interest in theproperty of the corporation, it does not 2est the owner thereof with any legal rightor title to any of the property, his interest in the corporate property being e0uitableor bene=cial in nature+ #hareholders are in no legal sense the owners of corporateproperty, which is owned by the corporation as a distinct legal person+


5/23

#ulo ng %ayan 2s+ Araneta BGR &-9?, D August D?E

Facts

!n :? April ??, #ulo ng %ayan, nc+ =led an accion de re2indicacion with the Courtof First nstance of %ulacan, Fifth udicial )istrict, Halenzuela, %ulacan, againstGregorio Araneta nc+ IGAJ, "aradise Farms nc+, 'ational aterwor3s K #ewerageAuthority I'AA#AJ,


6/23

president, as indi2idual, and the corporation are separate similarities+ #imilarly,stoc3holders in a corporation engaged in buying and dealing in real estate whosecerti=cates of stoc3 entitled the holder thereof to an allotment in the distribution ofthe land of the corporation upon surrender of their stoc3 certi=cates wereconsidered not to ha2e such legal or e0uitable title or interest in the land, as wouldsupport a suit for title, especially against parties other than the corporation+ t must

be noted, howe2er, that the 1uridical personality of the corporation, as separate anddistinct from the persons composing it, is but a legal =ction introduced for thepurpose of con2enience and to subser2e the ends of 1ustice+ 8his separatepersonality of the corporation may be disregarded, or the 2eil of corporate =ctionpierced, in cases where it is used as a cloa3 or co2er for fraud or illegality, or towor3 -an in1ustice, or where necessary to achie2e e0uity+ t has not been claimedthat the members ha2e assigned or transferred whate2er rights they may ha2e onthe land in 0uestion to the corporation+ Absent any showing of interest, therefore, acorporation, has no personality to bring an action for and in behalf of itsstoc3holders or members for the purpose of reco2ering property which belongs tosaid stoc3holders or members in their personal capacities+


7/23

%ataan #hipyard and Ongineering Co+ I%A#OC!J

Hs

"residential Commission on Good Go2ernment I"CGGJ

Facts

%A#OC! challenges Oxecuti2e !rders 'os+ and :, promulgated by former"resident Corazon C+ A0uino and the se0uestration, ta3eo2er, and acts donepursuant to the executi2e orders by the "CGG+

!n the strength on the se0uestration order issued by Commissioner MaryConcepcion %autista, ose %alde acting for the "CGG addressed a letter to the"resident and ocers of %A#OC! re0uesting for the production of certaindocuments+ 8he letter closed with a warning that if the documents are notsubmitted within . days, the ocers would be cited for conptempt+

"etitioner a2ers that the executi2e orders are unconstitutional+ hile %A#OC!concedes that se0uestration without 1udicial action may be made within the contextof the executi2e orders, howe2er when the Freedom Constitution was promulgated itceased to be acceptable+ 8his is because the Freedom Constitution adopted the %illof Rights embodied in the D9 Constitution+ %A#OC! argues that the assailed orderto produce corporate records infringed on their constitutional right against selfincrimination and unreasonable searches and seizures+

ssue

hether or not the right against self incrimination and the right against

unreasonable searches and seizures a2ailable to %A#OC! and 1uridical entityP

Ruling


8/23

8he right against self incrimination has no application to 1uridical persons+ hile anindi2idual IpersonJ may lawfully refuse to answer incriminating 0uestions, it doesnot follow that a person 2ested with spe+al pr+v+leges a#d fra#*+ses mayrefuse to show its hand when charged with abuse of such pri2ileges

8he corporation is a reature of t*e state+ t is presumed to be +#orporated forthe be#e.t of the publ+% t recei2ed spe+al pr+v+leges a#d fra#*+ses andholds them sub1ect to the la/s of the state and limitations of its *arter+

8here is a reser2e right on the legislature to in2estigate its contracts and =nd out/*et*er +t eeeded +ts po/ers+

t would be strange to hold that a state ha2ing chartered a corporation could not inthe exercise of so2ereignty in0uire how these franchises had been employed andwhether they had been abused and demand production of the corporate boo3s forthat purpose+


9/23

LR(A 34M5S$ (C%$ a#dor A(DA M% 4SADAS vs% 344RAL5 C4R4" A5ALS$ &AM5S (LD5R C4SRC(4 a#dor &A(M5 % RA:4

;%R% o% 12


10/23

property to it were in fraud of pri2ate respondents as such were done with the full3nowledge of %ra2o himself+ %esides, "osadas is not the ma1ority stoc3holder of&uxuria of the capital stoc3+


11/23

3G.R. No. 1047. M)y 28 18869

CONCEPT :UIL"ERS INC. petitioner vs. THE NATIONAL LA:OR RELATIONS COMMISSION;F#&s% "#v#s#o$u(l Cs%o)l R#(o M)$u(l G#ll(o P)l&o$#oG#-uos P(-&o Ao#)& No&(&%o Co'($-)-o& Ro(llo S)lu% E'#l#o G)) J&. M))$o R#oP)ul#$) :)s() A#*&(-o Al(&) P)>u#%o S)lu% "o'#$o Gu)$o Ro'(o G)lv( "o'#$)-o& S)#$)F(l#/( R)-#)$) G)v#$o Su)l##o Mo&($o Es)&(s F(&-#$)$- To&&(s F(l#/( :)s#l)$ )$- Ru($Ro)los respondents.

1AC*/

Petitioner Concept 4uilders$ Inc is a domestic corporation en.a.ed in construction 3usiness andherein private respondents are their la3orers$ carpenters and ri..ers On Novem3er -!?"$ the privaterespondents %ere issued 3y the petitioner$ individual termination letters indicatin. that their services %ere

no lon.er needed and that the pro5ect %as already inished Private respondents later ound out that such%as not the case and that petitioner en.a.ed the services o a su3contractor *his no% led$ respondentsto ile a case %ith the ,a3or Ar3iter a.ainst petitioner or ille.al dismissal$ unair la3or practices and non7payment o %a.es *he ,a3or Ar3iter decided in avor o respondents

An Alias 8rit o Execution %as issued 3y the ,a3or Ar3iter directin. the sheri to to execute thedecision and a second one or collection o the 3alance o the 5ud.ment a%ard /uch %rit %as notexecuted 3ecause petitioner stopped its operation A D3rea&7open order@ %as sou.ht 3y the respondents3ut 2ennis Cuye.&en.$ the ice7President o :ydro Pipes Philippines$ Inc (:PPI) iled a third partycomplaint$ alle.in. that the properties to 3e auctioned 3y the sheri %ere there9s and not o petitionersPrivate respondents then averred that :PPI and Concept 4uilders are the same and such interventionand deense o :PPI %as merely to avoid the perormance o Concept 4uilders9 o3li.ation$ as proo theypresented the certiicates issued 3y /EC to 3oth corporations :PPI ar.ued then that they are t%o distinct

and separate entities N,'C issued the D3rea&7open order@ and denied petitioner9s motion orreconsideration$ hence this petition

I//=E

8hether or not there %as an intention o the petitioners to evade their lia3ility a.ainst privaterespondents throu.h the intervention o :PPI

:E,2

Fes It is very o3vious that the second corporation see&s the protective shield o a corporateiction %hose veil in the present case could$ and should$ 3e pierced as it %as deli3erately and maliciouslydesi.ned to evade its inancial o3li.ation to its employees

*he corporate mas& may 3e lited and the corporate veil may 3e pierced %hen a corporation is 5ust3ut the alter e.o o a person or o another corporation 8here 3ad.es o raud existG %here pu3licconvenience is deeatedG %here a %ron. is sou.ht to 3e 5ustiied there3y$ the corporate iction or thenotion o le.al entity should come to nau.ht *he la% in these instances %ill re.ard the corporation as amere association o persons and$ in case o t%o corporations$ mer.e them into one

*hus$ %here a sister corporation is used as a shield to evade a corporation9s su3sidiary lia3ility ordama.es$ the corporation may not 3e heard to say that it has a personality separate and distinct rom theother corporation *he piercin. o the corporate veil comes into play


12/23

G+R+ 'o+ &-:9/9 !ctober :, ?/

H&&A ROQ 8RA'#8, 'C+, plainti@-appellant,

2s+

O$#O%! O+ FORROR, "A'GA#'A' 8RA'#"!R8A8!' C!+, 'C+ and "$%&C #ORHCOC!MM##!', defendants+

O$#O%! O+ FORROR and "A'GA#'A' 8RA'#"!R8A8!' C!+, 'C+, defendants-appellants+

"ACS'ose Hillarama was an operator of a bus transportation, under the business

name of Hilla Rey 8ransit, pursuant to certi=cates of public con2enience granted himby the "ublic #er2ice Commission I"#CJ+


13/23

(SS5' hether or not corporation is dis0uali=ed from operating the certi=cates ofpublic con2enience since it is merely the alter ego of ose+


14/23

compose it will be lifted to allow for its consideration merely as an aggregation ofindi2iduals+

$pon the foregoing considerations, e are of the opinion, and so hold, that thepreponderance of e2idence ha2e shown that the Hilla Rey 8ransit, nc+ is an alter egoof ose Hillarama, and that the restricti2e clause in the contract entered into by thelatter and "antranco is also enforceable and binding against the said Corporation+For the rule is that a seller or promisor may not ma3e use of a corporate entity as ameans of e2ading the obligation of his co2enant+ here the Corporation issubstantially the alter ego of the co2enantor to the restricti2e agreement, it can been1oined from competing with the co2enantee+


15/23

>ao$ Sr% vs% eople of t*e *+l+pp+#es;%R% 168?06 &u#e 19$ 2007

"etitioners are incorporators and ocers of MA#AGA'A GA# C!R"!RA8!', anentity engaged in re=lling, sale and distribution of &"G "roducts+ "ri2aterespondent "etron Corporation I"etronJ and "ilipinas #hell "etroleumCorporation I#hellJ are two of largest bul3 suppliers and producers of &"G in the"hilippines, and their &"G are sold under the mar3s GA#$& and #


16/23

G.R. No. 150716 July 21 2006

SE?ENTH "AY A"?ENTIST CONFERENCE CHURCH OF SOUTHERN PHILIPPINES INC. )$-@o&&(/&(s($%(- y MANASSEH C. ARRANGUE :RIGI"O P. GULAY FRANCISCO M. LUCENARA"IONICES O. TIPGOS LORESTO C. MURILLON ISRAEL C. NINAL GEORGE G. SOMOSOTJESSIE T. OR:ISO LORETO PAEL )$- JOEL :ACU:ASpetitioners$vsNORTHEASTERN MIN"ANAO MISSION OF SE?ENTH "AY A"?ENTIST INC. )$-@o& &(/&(s($%(-y JOSUE A. LAYON BEN"ELL M. SERRANO FLORANTE P. TY )$- JETHRO CALAHAT )$-@o&SE?ENTH "AY A"?ENTIST CHURCH 3OF9 NORTHEASTERN MIN"ANAO MISSION H'espondents2 E C I / I O N

CORONA J.:

FACTS!*his case involves a lot covered 3y 4ayu.an$ A.usan del /ur ori.inally o%ned 3y 1elix Cosio and his%ie$ 1elisa Cuysona *he spouses Cosio donated the land to the /outh Philippine =nion Mission o/eventh 2ay Adventist Church o 4ayu.an Esperan;a$ A.usan (/P=M7/2A 4ayu.an)*he donation %as alle.edly accepted 3y one ,i3erato 'ayos$ an elder o the /eventh 2ay AdventistChurch$ on 3ehal o the donee

*%enty7one years later$ ho%ever$ the same parcel o land %as sold 3y the spouses Cosio to the /eventh2ay Adventist Church o Northeastern Mindanao Mission (/2A7NEMM)Claimin. to 3e the alle.eddonee9s successors7in7interest$ petitioners asserted o%nership over the property *his %as opposed 3yrespondents %ho ar.ued that at the time o the donation$ /P=M7/2A 4ayu.an could not le.ally 3e adone 3ecause$ not havin. 3een incorporated yet$ it had no 5uridical personality Neither %ere petitionersmem3ers o the local church then$ hence$ the donation could not have 3een made particularly to them

ISSUE!Is the donation valid considerin. that the Church is not yet incorporated

HEL"!8e a.ree %ith the appellate court that the alle.ed donation to petitioners %as void

2onation is an act o li3erality %here3y a person disposes .ratuitously o a thin. or ri.ht in avoro another person %ho accepts it *he donation could not have 3een made in avor o an entity yetinexistent at the time it %as made Nor could it have 3een accepted as there %as yet no one to accept it*he deed o donation %as not in avor o any inormal .roup o /2A mem3ers 3ut a supposed /P=M7/2A 4ayu.an (the local church) %hich$ at the time$ had neither 5uridical personality nor capacity to acceptsuch .it

2eclarin. themselves a de factocorporation$ petitioners alle.e that they should 3eneit rom the donation4ut there are strin.ent requirements 3eore one can qualiy as a de facto corporation(a) the existence o a valid la% under %hich it may 3e incorporatedG(3) an attempt in .ood aith to incorporateG and(c) assumption o corporate po%ers

*he ilin. o articles o incorporation and the issuance o the certiicate o incorporation are essential orthe existence o a de facto corporation 8e have held that an or.ani;ation not re.istered %ith the/ecurities and Exchan.e Commission (/EC) cannot 3e considered a corporation in any concept$ noteven as a corporation de facto Petitioners themselves admitted that at the time o the donation$ they%ere not re.istered %ith the /EC$ nor did they even attempt to or.ani;e to comply %ith le.alrequirements


17/23

*he de acto doctrine thus eects a compromise 3et%een t%o conlictin. pu3lic interestsBJthe oneopposed to an unauthori;ed assumption o corporate privile.esG the other in avor o doin. 5ustice to theparties and o esta3lishin. a .eneral assurance o security in 3usiness dealin. %ith corporations+enerally$ the doctrine exists to protect the pu3lic dealin. %ith supposed corporate entities$ not to avorthe deective or non7existent corporation

In vie% o the ore.oin.$ petitioners9 ar.uments anchored on their supposed de facto status hold no %ater8e are convinced that there %as no donation to petitioners or their supposed predecessor7in7interest


18/23

G.R. No. 136448. November 3, 1999.*

LIM TONG LIM, petitioner, vs. PHILIPPIN !I"HING G#R IN$%"TRI", IN&., respon'ent.

P#NG#NI(#N, ).

!+ts

On be-+/ o/ 0Oe+n 2est !is-in &orpor+tion, #ntonio &-2+ +n' Peter 5+o p2r-+se' /is-in nets +n'

/o+ts /rom t-e P-iippine !is-in Ge+r In'2stries, In. -erein respon'ent7. T-e +ime' t-+t t-e ere

en+e' in + b2siness vent2re it- Petitioner Lim Ton Lim, -o -oever +s not + sin+tor to t-e

+reement.

T-e b2ers, -oever, /+ie' to p+: -ene, priv+te respon'ent /ie' + oetion s2it ++inst &-2+, 5+o +n'

Petitioner Lim Ton Lim it- + pr+er /or + rit o/ preimin+r +tt+-ment.

T-e s2it +s bro2-t ++inst t-e t-ree in t-eir +p+ities +s ener+ p+rtners, on t-e +e+tion t-+t 0Oe+n2est !is-in &orpor+tion +s + none;istent orpor+tion +s s-on b + &erti/i+tion /rom t-e "e2rities

+n' ;-+ne &ommission.

Petitioner ontests s2- i+biit, insistin t-+t on t-ose -o 'e+t in t-e n+me o/ t-e ostensibe

orpor+tion s-o2' be -e' i+be. "ine -is n+me 'oes not +ppe+r on +n o/ t-e ontr+ts +n' sine -e

never 'iret tr+ns+te' it- t-e respon'ent orpor+tion, ero, -e +nnot be -e' i+be.

Iss2e

2estion+b, petitioner bene/ite' /rom t-e 2se o/ t-e nets /o2n' insi'eF/B Lourdes, t-e bo+t -i-

-+s e+rier been proven to be +n +sset o/ t-e p+rtners-ip. He in /+t >2estions t-e +tt+-ment o/ t-e nets,

be+2se t-e


19/23

tr+ns+tion entere' b it +s + orpor+tion or on +n tort ommitte' b it +s s2-, it s-+ not be +oe' to

2se +s + 'e/ense its += o/ orpor+te person+it.

0One -o +ss2mes +n obi+tion to +n ostensibe orpor+tion +s s2-, +nnot resist per/orm+ne t-ereo/

on t-e ro2n' t-+t t-ere +s in /+t no orpor+tion.


20/23

%atch case 9nternational Oxpress 8ra2el K 8our 2s+ CA K


21/23

%atch Case ;

Filipinas %roadcasting 'etwor3 2s AMOC-%CCM

Facts

t started with a radio program titled 4OxposS6 hosted by Carmelo TMelU Rima I4Rima6J and


22/23

Coastal "aci=c 8rading, nc+ 2s+ #outhern Rolling Mills Co+

G+R+ 'o+ /?:

uly :/, :?

FAC8#

Respondent #outhern Rolling Mills Co+, nc+ was organized in . for the purpose ofengaging in a steel processing business+ t was later renamed Hisayan ntegrated#teel Corporation IH#C!J+ n ?, H#C! obtained a loan from )%" amounting to"/9?,+ t was secured by a Real Ostate Mortgage co2ering H#C!Ls 9 parcels ofland including the machinery and e0uipment therein+ A second loan was thenentered by H#C! with respondent ban3s I referred as NConsortiumNJ to =nance itsimportation for 2arious raw materials+ H#C! executed a second mortgage o2er thepre2ious properties mentioned, howe2er they were unrecorded+ H#C! was unable

to pay its second mortgage with the consortium, which resulted in the latterac0uiring > of the e0uity of H#C! gi2ing the Consortium the control andmanagement of H#C!+ )espite the ac0uisition, H#C! still remained indebted to theConsortium+ %etween ?; to ?., H#C! entered a processing agreement withCoastal wherein Coastal deli2ered 9, metric tons of hot rolled steel coils whichH#C! would process into bloc3 iron sheets+


23/23

feelings, serious anxiety, mental anguish and moral shoc3+ 8he only exception tothis rule is when the corporation has a good reputation that is debased, resulting inits humiliation in the business realm+ n the present case, the records do not showany e2idence that the name or reputation of petitioner has been sullied as a resultof the ConsortiumLs fraudulent acts+ Accordingly, moral damages are not warranted+"etitioner was able to reco2er exemplary damages

corpo digest batch 1 (2)

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