Mr. Juan T. Tasarra

September 14, 1998 Mr. Juan T. Tasarra Block 2, Lot 3 Ariza Drive Camella Homes II-D Alabang, Muntinlupa City S i r : This refers to your letter dated August 31, 1998 inquiring whether you, as a stockholder of the Rural Bank of Baganga, Inc., can request for copies of the Board Resolutions of the Bank and whether you can inspect the Books of Accounts of the Bank and bring your own CPA. dctai The pertinent provision of the Corporation Code provides: "SECTION 74. Books to be kept ; . . . . Every corporation shall at its principal office, keep and carefully preserve a record of all business transactions, and minutes of all meetings of stockholders or members, or of the board of directors or trustees, . . . The records of all business transactions of the corporation and the minutes of any meeting shall be open to the inspection of any director, trustee, stockholder or member of the corporation at reasonable hours on business days and he may demand, in writing, a copy of excerpts from said records or minutes, at his expense . xxx xxx xxx" (Emphasis supplied) Thus, your queries are answered in the affirmative. The right of the stockholders to inspect the corporate books and records is based on the principle that a stockholder has the right to be fully informed as to the status and condition of the corporation, the manner its affairs are conducted and how its capital to which they have contributed is employed or managed. Said right may be exercised either by himself or by any proper representative or attorney-in-fact, who may be an accountant or a lawyer or any other person who can help the stockholder understand and interpret the corporate records, and either with or without the attendance of the stockholder. (SEC Opinion addressed to T.J. Mulvany & Co. dated January 12, 1996 citing Philpotts v. Philippine Manufacturing Co. & Berry, G.R. No. 15568, November 8, 1919, 40 Phil . 471 ). This privilege, however, is not absolute and the corporation may show in defense that the stockholder is acting from wrongful motives. ( SEC Opinion addressed to J. Romero & Associates, Inc. citing Ballantine on Corporation Sec . 160, p . 377 ) The exercise of the right of inspection of corporate books and records should be for a legitimate purpose. This means that the intention should be germane to the interest of the stockholder as such, as where the purpose is to find out the actual financial condition of the corporation and how his investment is being used. Likewise, the purpose should not be contrary to the interest of the corporation nor should it be made merely to gratify a stockholder's curiosity or for a speculative use. ( SEC Opinion addressed to Mr. Nestor S. Mangio dated May 2, 1994, citing several authorities ) LexLib Please be advised accordingly. Very truly yours, (SGD.) FE ELOISA C. GLORIA Associate Commissioner