Ms. Imelda E. Santos

June 24, 1988 Ms. Imelda E. Santos Builders Savings and Loan Associations, Inc. 314 J.P. Rizal Street Sto. Nio, Marikina Metro Manila Madam : This has reference to your letter dated April 26, 1988 referred to this Commission by Mr. Ramon Tiaoqui of the Central Bank on May 11, and received on May 27, 1988 requesting the opinion of this Commission on whether the stockholdings of Dr. Fernando Buenviaje (now deceased) can still be transferred to his son, Enrique Buenviaje on the basis of the former's letter dated October 15, 1987 to the Acting Chairman and President of the bank (now, consultant) while she was in the United States. Relative thereto, Sec. 63 of the Corporation Code provides, and we quote: "SECTION 63. Certificate of Stock and Transfer of Shares . ...Shares of stock so issued are personal property and may be transferred by delivery of the certificate or certificates endorsed by the owner or his attorney-in-fact or other person legally authorized to make the transfer. No transfer, however, shall be valid, except as between the parties, until the transfer is recorded in the books of the corporation showing the names of the parties to the transaction, the date of the transfer the number of the certificates and the number of shares transferred. xxx xxx xxx From the above, it is clear that shares of stock may be transferred by delivery of the certificates endorsed by the owner to the transferee. However, to be valid the transfer should be registered in the corporate books. It must be noted that in this instance the stockholder requested the acting Bank Chairman and President to transfer the former's shares to his son on the basis of a letter. There is no indication that the certificates covering the shares of stock were endorsed to the transferee. This Commission in a previous opinion has ruled that "on the death of a shareholder his executor or administrator becomes vested with the legal title to the stock and entitled to vote the same at all meetings and that until a settlement and division of the estate is affected, the stock of the deceased belong to said administrator or executor of his personal representative." ( Letter to Mr. S.F. de la Cruz dated October 10, 1979 ,SEC Opinion, p. 92). Applying the above to the instant case, on the death of Dr. Buenviaje, his executor or administrator becomes vested with the legal title to the stock. Until a settlement and division of his estate is made, the stock of the deceased belongs to said administrator. At this stage, in view of the foregoing, his stockholding can no longer be transferred to his son on the basis of his letter dated October 15, 1987. Please be advised accordingly. Very truly yours, (SGD.) JULIO A. SULIT, JR. Chairman