Mr. Juan V. Bora, Jr.

September 28, 1992 Mr. Juan V. Bora, Jr. Assistant Secretary Land Transportation Office Department of Transportation & Comm. East Avenue, Quezon City S i r : This refers to your letter of September 16, 1992 requesting opinion whether or not a corporation with the following purpose clause in its articles of incorporation is qualified to bid for the printing of validation stickers and plate year tags to be issued by the Land Transportation Office for calendar year 1993. Primary purpose: "To engage in the general advertising business." Secondary purposes: "(a) To engage in the general business of buying, selling or dealing in general merchandise, including school and office supplies or goods, wares and commodities of every kind and description. xxx xxx xxx (c) To engage on a general agency except insurance agency or commission business; to act as manufacturers' representatives or agents upon consignment or indent orders or any other representative capacity for natural and juridical persons and entities either domestic or foreign." Nowhere in the above-quoted purpose clause do we find a provision authorizing the corporation to engage in printing business. It is well-settled that a corporation has only such powers as are expressly granted in its charter or in the statutes under which it is created or such powers as are necessary for the purpose of carrying out its express powers. (SEC Opinion dated March 23, 1988 citing 13 Am. Jur. Sec. 739). "In the determination of what business may be carried on by a corporation, reference must be had to its charter, and unless the power to carry on a particular business is either expressly or impliedly conferred thereby, it does not exist." (Chiwacla Lines v. Disnukes, 87 Ala. 344, 650, 122, 5 LRA 100, cited in Am. Jur., Supra., sec. 743). By a familiar rule, every public grant of property or of privileges or franchises, if ambiguous, is to be construed against the grantee and in favor of the public, because an intention on the part of the government to grant to private persons, or to a particular corporation, property or rights in which the whole public is interested, cannot be presumed unless unquestionably expressed or necessarily to be implied in the terms of the grant . . . . (Central Transp. Co. v. Pullman's Car Co., 139 US 24, 35 L Ed 55, 11 S Ct. 478., cited in 6 Fletcher Sec. 2483) Thus, in determining corporation's powers, if any ambiguity exists in the corporate charter, the charter must be strictly construed. Accordingly, the corporation cannot, on the basis of the aforequoted purpose clause, engage in purely printing business. It may engage in printing activity only if necessary or incidental in accomplishing its express powers, e.g. advertising business, trading and general agency, as enumerated above. Should the corporation desire to undertake printing business for others, it should amend its articles of incorporation in accordance with Section 16 of the Corporation Code to include it among its purposes. Please be advised accordingly. Very truly yours, (SGD.) ROSARIO N. LOPEZ Chairman