Ms. Ma. Gracia R. Soller

May 23, 1991 Ms. Ma. Gracia R. Soller Provincial Director National Capital Region Department of Trade and Industry 3rd Floor, W.I.P. Bldg. 349 Sen. Gil J. Puyat Ave. Makati, Metro Manila M a d a m : This refers to your letter of May 8, 1991 requesting opinion whether the Advocates for Services and Resources of the Community (ASRC) Foundation, Inc. can apply for a loan by mere Board Resolution, without the act being necessarily stated in its Articles of Incorporation and By-laws. cdll Article II of the Articles of Incorporation or subject corporation provides: "In furtherance of the foregoing, the corporation shall: 4. Exercise in general, any and all lawful powers whatsoever in connection with the foregoing or which are calculated, directly or indirectly, to promote the interest of the corporation or to enhance the value of its properties and to perform everything necessary and proper for the attainment of its purpose ." (Emphasis supplied) The exercise of the above-mentioned implied or incidental power by the Corporation is expressly recognized by law, particularly, under paragraph 11 of Section 36 thereof, quoted hereunder: "SECTION 36. Corporate Powers and Capacity . Every corporation incorporated under this code has the power and capacity: xxx xxx xxx 11. To exercise such other powers as may be essential or necessary to carry out its purpose or purposes as stated in its articles of incorporation." (Emphasis supplied) The rule may thus be stated that the management of a corporation which is vested in the Board of Directors , in the absence of express restrictions, has discretionary authority to enter into contracts or transactions, including loan agreements, which may be deemed reasonably incidental to its business purposes . In the light of the foregoing, subject corporation, when necessary in the pursuit of the purposes for which it was organized may borrow money regardless of whether or not the authority to borrow is expressly stated in the articles of incorporation or by-laws. Please be advised accordingly. (SGD.) ROSARIO N. LOPEZ Chairman