Bible Baptist Church

August 8, 1997 Bible Baptist Church 35 Ma. Guerrero St., 8000 Davao City Attention : Mr . Johnson de Jesus Corporate Secretary S i r : This refers to your letter dated January 24, 1997, on behalf of Bible Baptist Church in Davao City, Inc.,requesting opinion on the queries posed therein, quoted hereunder: LexLib "1. Under the New Corporation Code (1980), religious entities do not have terms of existence. What positive implication will this be to those religious entities incorporated prior to 1980 and have thereto stipulated a specific term (20 years) for its corporate existence? 2. What if the term thereto specified (20 years) already expired: a) Can the religious entity continue to act as a corporation? b) Will it affect the validity of its approved resolutions during the period?" Sections 110 and 116 of the new Corporation Code (Batas Pambansa Blg. 68) and Section 160 of the old Corporation Law (Act 1459, as amended) do not provide for a term of existence of religious corporation, whether classified as corporation sole or corporation aggregate. Thus, the Commission previously opined that the law never intended to limit the corporate life of religious corporations. Accordingly, they may be allowed to exist perpetually. (SEC Opinion dated October 23, 1995 addressed to United Evangelical Church of the Philippines citing previous SEC Opinions) However, while perpetual term is allowed, if the articles of incorporation of the religious corporation stipulate to limit its term of existence to a fixed period, such stipulation should be followed. It is well-settled that the "charter of a corporation is a contract between three parties: (a) Between the State and the corporation, (b) between the stockholders (members in case of non-stock corporation) and the State, and (c) between the corporation and the stockholders (members in case of non-stock corporation) and the state, and (c) between the Corporation and the stockholders (members). The state cannot require the performance of a duty on the part of the corporation or entity, contrary to the provisions of the charter of said corporation or entity. (Government of P.I. v. Manila Railroad Co. and Paez, G.R. No. 30646, January 30, 1929, 52 Phil. 699) The articles of incorporation is a contract between the stockholders/subscribers (members) and the corporation, by and among themselves and between the corporation and State. Unless and until amended accordingly, all the provisions thereof bind all the persons composing it". ( Rubio et al. vs. Escosa et al.,SEC AC No. 170, September 4, 1987 ) Accordingly, after the expiration of the term of corporate existence as provided for in its Articles of Incorporation, the religious corporation is deemed legally dissolved. However, it may continue to act as an ordinary religious church or corporation. The Corporation Code does not require religious group to be registered as a corporation. Even if not registered, the members of a religious organization, by agreement, may perform acts not contrary to law, morals, good customs, public order or public policy. However, since the status of the religious group is only that of an "ordinary organization" which has no juridical personality, the members themselves can be held personally liable for their acts, not the organization. In order to re-acquire its previous status as a corporation with a separate legal personality from the members and to enable it again to exercise corporate powers, rights and privileges expressly granted under the Corporation Code, it may re-incorporate or register again as a religious corporation pursuant to the provisions of the Corporation Code. Please be advised accordingly. Very truly yours, (SGD.) PERFECTO R. YASAY, JR. Chairman