Philippine Veterans Assistance Commission

April 7, 1987 Philippine Veterans Assistance Commission Camp General Emilio Aguinaldo Quezon City Attention : Gen . Florencio J . Palacios (Ret . ) Sir : This relates to your letter, dated March 19, 1987, requesting the opinion of this Commission on the queries posed therein. It appears that the Philippine Veterans Assistance Commission is a body corporate and politic created under Presidential Decree No. 244, as amended by PD No. 1077. The Commission is composed of the Secretary of National Defense himself or his representative duly designated by him, the Chief of Staff of the Armed Forces of the Philippines, the Administrator of the Philippine Veterans Affairs Office, the President of the Philippine Veterans Banks and three appointive members who shall represent the veterans group, to be appointed by the President. However, due to recent development which placed the Philippine Veterans Bank under receivership, its President ceased to be a member of the Commission, thus, reducing the number of Commissioners to six. Moreover, you alleged that the Chief of Staff, Armed Forces of the Philippines, seldom attends board meetings due to his hectic military schedules and activities, thereby, affecting the Commission's capability to obtain a quorum, in order to deliberate on urgent and important issues relative to veterans welfare and activities. cdll Hence, your queries are: 1. Can any member of the Commission aside from the Chairman, designate any person to act as his proxy or representative in the Commission's Board meeting? 2. In the determination as to whether the Commission has a quorum or not, is it valid to consider the proxy's presence 3. Can the proxy/representative vote on issues to be deliberated upon by the Commission? 4. Can the proxy/representative sign the minutes of the Commission's resolution? In reply, quoted hereunder are the pertinent provisions of the Corporation Code: "SECTION 4. Corporations created by special laws or charters . Corporations created by special laws or charters shall be governed by the special law or charter creating them or applicable to them, supplemented by the provisions of this Code, insofar as they are applicable. " (emphasis supplied). "SECTION 25. ... Directors or trustees cannot attend or vote by proxy at board meetings. " However, where the corporation is under receivership, "the appointment of a receiver for a corporation terminates, at least for the most part, the powers of the corporate officers as to the property in possession of the receiver where the receivership is a general one, and not merely for the preservation of the company's property pending a suit in reference to it." (16 Fletcher Cyc. Corp.,sec. 7784, citing In re: Benver Cotton Mills, 275 F 498)." A general receiver succeeds to all of the rights of the board of directors, managers and officer s ." (Fletcher, Supra.).These general rules apply to receiverships of insolvent banks. (Fletcher, p. 326).A receiver is not only a representative of the court, but he also represents both the stockholders and the creditors of the corporation, and as their trustee, he acts not for himself, but for both and represents each. (Fletcher, sec. 7810, pp. 401-402).In some respect, he is the agent or representative of the corporation. (Fletcher, Supra.,p. 404). Where a corporation is under a general receivership, it may be represented in the board of directors/trustees of another corporation through its receiver. Please be guided accordingly. Very truly yours, (SGD.) JULIO A. SULIT, JR. Chairman