Mr. Edison C. Alba

March 25, 1983 Mr. Edison C. Alba 534 EDSA, Cubao Quezon City Sir : This refers to your letter dated March 1, 1983, requesting the opinion of the Commission on the queries posed therein. llcd It appears that under the by-laws of FAITH BAPTIST CHURCH, INC.,the Board of Trustees shall exercise the management, control and administration of the activities and property of the corporation. However, under its constitution, it is the Church Council which has the power to establish, design, promote, review and evaluate the annual program of the church as presented by the pastor, and all other matters inherent to the successful execution of the church activities. The constitution likewise provides that the treasurer shall disburse church funds only if authorized by the Church Council, whereas, the by-laws is silent on the matter. Queries : 1. In case of conflict between the Constitution and by-laws, which should prevail? 2. Who is the controlling body, the Board of Trustees of the Church Council? 3. Can the treasurer disburse funds even without the authority of the Church Council? 4. Can the Church Council perform functions which properly belong to the Board of Trustees, such as creation of positions? Answers : 1. It is worth mentioning that "in addition to by-laws, a corporation may, and usually does, adopt other rules and regulations for its government, chief of which are the so-called constitution and resolutions". (Fletcher, Cyclopedia Corporations, Vol. 8, p. 624). Thus, if the by-laws and the constitution are in consonance with, and not repugnant to or in contravention with the Corporation Code, the two must be read together to supplement each other. However, in case the provisions of the Constitution are in conflict with the Corporation Code or with the provisions of the By-Laws on the same matter, then the by-laws shall prevail. 2. It would appear, that under the constitution of subject corporation, the control and management of the Church is vested with the Church Council as the same is charged with the power to establish and design its program of activities and all other matters inherent to the success of the church, which is a violation of the provisions of the Corporation Code on the matter. The law provides, thus: "SECTION 23. The Board of Directors or Trustees . Unless otherwise provided in this Code, the corporate powers of all corporations formed under this Code shall be exercised all business conducted and all property of such corporations controlled and held by the board of directors or trustees ...." (emphasis supplied) It is very clear from the foregoing provision that the controlling body is the Board of Trustees. Considering, therefore, that the provisions of the constitution on the matter are contrary to the aforecited provision of law, the said provisions would not be considered as valid. Hence the provisions of the by-laws on the matter should prevail. 3. It does not follow that since under the Church constitution the treasurer cannot disburse funds without the authority of the Church Council, he cannot do so even in proper cases without the authority of the Council. As long as there is an order by the Board of Trustees, which has custody of the property of the Corporation, he may do so. The treasurer of the corporation is "bound to disburse the corporate funds under, and only under the orders of the directors or other officers in charge of the corporate business ".(Fletcher Cyclopedia Corporations Vol. 2, p. 807, emphasis supplied). 4. The pertinent provision of law on your fourth query is found in Section 25 of the Corporation Code, which provides as follows: "SECTION 25. Corporate Officers ,.... Immediately after their election, the directors of a corporation must formally organize by the election of a president, ...a treasurer ...,a secretary ..., and such other officers as may be provided for in the by-laws ...." Considering that the by-laws of your corporation do not empower the board of directors to create additional offices as they become necessary, it follows that whoever are the particular officers provided for in the by-laws are the exclusive officers of the corporation. The board has no power to create new offices without amending the by-laws. Please be advised accordingly. prcd Very truly yours, (SGD.) JESUS J. VALDES Associate Commissioner