Vernida I Condominium Corporation

May 23, 1985 Vernida I Condominium Corporation Amorsolo Street Legaspi Village Makati, Metro Manila Attention : Mr . Honesto C . Evangelista President Sir : This has reference to your letter dated April 26, 1985, requesting for the opinion of this Commission on the query posed therein. llcd It appears therein the two (2) members of your Board of Directors have been delinquent in the payment of association dues for the last three (3) quarters, more or less. It likewise appears that the present Board majority declared them unqualified to sit in the Board because of their delinquent dues and the fact that they therefore, are not members in good standing. You now request for the opinion of this Commission on whether or not you can replace these two (2) directors and the manner or procedure of replacing said directors. Anent thereto, please be informed that Article III, Sec. 1, par. 3 of your approved By-Laws provides, and we quote: "Any Director may be recalled and removed from office by the affirmative vote of members representing two-thirds (2/3) of the total voting power of the corporation at any general or special meeting. The resulting vacancy shall be filled by and elected by the members and not by the Directors." In similar queries, this Commission has ruled that: "The Board of Directors has no inherent power to remove one of its number. This well-settled doctrine is embodied in our Corporation Law (now Code), which explicitly provides as follows: "SECTION 34. Directors of a corporation may be removed from office by vote of two-thirds (2/3) of the members entitled to vote . . ." (now, Sec. 28 of the Corporation Code) ( Ltr. to Mr. Ramon Hechanova dtd. September 5, 1979 ) cdll "The authority to elect or remove the members of the board of directors is lodged in the stockholders or members of the corporation (Sections 24 and 28, Corporation Code of the Philippines). Since the law expressly confers this authority to the stockholders or members, the directors cannot indirectly usurp or disregard the same." ( Ltr. to Mr. Carlos Vicente, dtd. June 3, 1981 ) Considering the foregoing, your Board of Directors, therefore, cannot remove said two (2) delinquent members. Said members can only be removed by two-thirds (2/3) of the total voting power of your corporation. Insofar as their replacement is concerned, the same may be filled by and elected by the members in accordance with said Sec. 1, Article III. Please be advised accordingly. Very truly yours, (SGD.) ROSARIO N. LOPEZ Associate Commissioner