Atty. Leonides S. Respicio

January 30, 1990 Atty. Leonides S. Respicio Respicio & Britanico Law Offices Unit T-2A Mile Long Center Amorsolo St.,Legaspi Village Makati, Metro Manila S i r : This refers to your letter dated November 23, 1989, requesting clarification on the legal basis of the SEC requirement that the treasurer of a corporation must be a resident of the Philippines, and inquiring whether a foreigner who is a permanent resident or a grantee of an investor's visa or a retirement visa is qualified to be elected as such. While the Corporation Code requires that the Secretary of the Corporation must be a resident and citizen of the Philippines, the law is silent on the same restriction with respect to the treasurer. However, it is worthy to note that the treasurer of a private business corporation is ordinarily the custodian of its funds with authority to disburse them in a proper case; this power he has by virtue of his office. (2 Fletcher, Cyc. Corp.,1969 Rev. Vol.,sec. 654, p. 806) The treasurer of a corporation is the proper officer, and the only proper officer in the absence of express provision to the contrary to receive and keep the moneys of the corporation .(Fletcher Supra, citing Abro Mining and Milling Co. v. Chinn, 20 Colo App 238, 77 p. 1097; Dambury & M.R. Co. v. Wilson, 22 Conn, 435 and others),and he 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. (Alin Mathieson Chemical Corp. v. Planters Corp. 236 SC 318, 114SE 2d 321). He has authority to receive and receipt for moneys due the corporation .(Brown v. Dinnisimment Co.,11 Allen 326) Taking into consideration the nature of the functions of the treasurer, there is more reason for the treasurer to also possess the same qualifications as the secretary. Thus, the Commission. in its opinion dated July 28, 1986, addressed to Tan, Sapalo, Manzano & Velez Law Offices, ruled that while the Corporation Code does not impose a Philippine residency requirement to the treasurer, nevertheless, considering the nature of his functions as hereinabove set forth, good corporate practice dictates that the treasurer must be a resident of the Philippines. Anent your second query, the term "resident" or "residence" as used in corporate statutes requiring one or certain number of directors to be residents of the state, " is equivalent to domicile the pertinent elements of which are physical presence in the state and an intention to remain therein . (SEC Opinion dated January 17, 1985, citing 2 Fletcher, Cyc. Corp., 1969 Rev. Vol. sec. 307 at 97). The term "resident" imports more than a temporary stay in a place for the performance of a single piece or job of work, especially where the workman, at the same time, has a home and permanent place of abode in another place. It is therefore difficult to define in precise language what constitutes a residence or what makes one a resident of a place. Much depends upon the circumstances then surrounding the person, upon the character of the work to be performed, upon whether he has a family or a home in another place, and largely upon his present intention .(Ibid, citing Words and Phrases, at 404) Suffice it therefore to state that for as long as the foreigner who is a grantee of an investor's visa or retirement visa possesses the essential elements of physical presence in the Philippines and intends to remain therein, he may be considered a resident of the Philippines for qualification purposes of an incorporator, director of officer. However, it is worth mentioning that pursuant to the provisions of Commonwealth Act No. 108, as amended by PD 715, otherwise known as the Anti-Dummy Law, aliens are banned from being elected or appointed to management positions as president, vice-president, treasurer, auditor, etc. in firms engaged in wholly or partially nationalized business ,although they can be elected directors in proportion to their allowable participation or share in the capital of such companies. (Section 2-A) prcd Please be advised accordingly. Very truly yours, (SGD.) RODOLFO L. SAMARISTA Associate Commissioner