Reynaldo J. Echavez, M.D.

May 16, 1996 Reynaldo J. Echavez, M.D. Philippine Medical Association PNA Bldg.,North Avenue, Quezon City S i r : This refers to your letter dated May 13, 1996 requesting opinion on the queries posed therein summarized as follows: LibLex 1. Whether the acts of the incoming Board during its first Board meeting in electing or appointing the corporate officers, confirming the dates of board meetings and affirming the programs of the succeeding administration would be legal and valid taking into consideration that their term of office will only start a few days after. 2. What is the basis for the bond requirement of the " Treasurer " of a corporation, how much and who would pay the same? The provision of the Corporation Code pertinent to your first query is Section 25, quoted in part hereunder: SECTION 25. Corporate officers, quorum . Immediately after their election ,the directors of a corporation must formally organize by the election of a president ,who shall be a director, a treasurer who may or may not be a director, a secretary who shall officers as may be provided for in the by-laws. ..." (Emphasis supplied) Accordingly, the newly elected members of the Board of Directors may convene right after their election to elect the new set of corporate officers. However, they cannot transact any other matter prior to their assumption of office, although they may discuss future programs to be adopted under their administration. On the issue of bond requirement , please be advised that while the Corporation Code does not require corporate officers to post bonds as a condition prior to assumption of office, the Commission, as a matter of policy, requires treasurers of non-stock corporations to post bonds so as to safeguard the contributed/donated funds which are normally under the custody of the treasurer. However, the amount of the bond to be posted by the Treasurer is discretionary on the part of the Board of Directors or Trustees. llcd Very truly yours, (SGD.) FE ELOISA C. GLORIA Associate Commissioner