Mr. Patrocino A. Monte

August 29, 1983 Mr. Patrocino A. Monte Bureau of Muslim Economic Affairs 6th Flr.,Delta Motor Sales Corp. Bldg. EDSA cor. Ortigas Avenue Mandaluyong, Metro Manila Sir : This has reference to your letter dated July 20, 1983, requesting for opinion on the query posed therein. prcd It appears that you are preparing the by-laws of a proposed corporation. In the process, the members are divided into two camps: 1. One camp says and vehemently asserts that the TREASURER should report directly to the PRESIDENT (and Chief Executive Officer) of the corporation. The other subordinate treasury officers like the finance manager and property manager shall report to the treasurer. 2. The other camp otherwise says and strongly support that the TREASURER should report directly to the Board of Directors. Likewise, subordinate treasury officers namely, finance manager and property manager shall report to the treasurer. Question: Is the Treasurer legally bound by the Corporation Code to report directly to the President (and Chief Executive Officer) or not? The provision of law pertinent to your query is Section 47 of the Corporation Code which provides in part, to wit: "SECTION 47. Contents of by-laws . Subject to the provisions of the Constitution, this Code, other special laws and the articles of incorporation, a private corporation may provide in its by-laws for: cdlex xxx xxx xxx 3. The qualifications, duties and compensation of directors or trustees, officers and employees." ...(emphasis supplied) The foregoing provision authorizes corporations to provide in their by-laws the duties of the officers. Considering that the by-laws have to be approved by the members, the question as to whom the treasurer shall report to, falls within the power of the members to decide. Section 46 of the Corporation Code, thus, provides in part: "SECTION 46. Adoption of by-laws . ....For the adoption of by-laws by the corporation the affirmative vote of the stockholders representing at least a majority of the outstanding capital stock, or of at least majority of the members in case of non-stock corporations ,shall be necessary." (emphasis supplied). In the absence of a provision in the by-laws, however, the treasurer shall report to the Board of Directors, the latter being charged with the management of the affairs of the corporation. Please be advised accordingly. Very truly yours, (SGD.) MANUEL G. ABELLO Chairman