Mr. Edudrado L. Morales

April 1, 1996 Mr. Edudrado L. Morales Parents-Teachers Community Association Mariano Marcos Mem. High School 2090 Dr. Carreon St.,Sta. Ana, Manila S i r : This refers to your letter dated March 16, 1995 requesting opinion on whether or not a non-member or any entity can restrict or control the activities undertaken by the corporate officers of a Foundation, more particularly in the collection of membership fee from the members thereof. As a general rule, under the Corporation Code, the performance of the corporate functions pertaining to the management of the corporation is vested upon the Board of Directors who are elected by the members of the corporation. Accordingly, in the absence of fraud, bad faith or negligence, the members or any third person cannot interfere with the exercise of corporate judgment by the Board of Directors relating to the management of the corporation. Take note, however, that acts of the Board of Directors may be reviewed or questioned if the corporation's and/or members' interests are prejudiced. On the matter at collection of membership fees, the manner of assessing membership dues should be done in accordance with the provisions of the corporate By-laws, the amount of which should be reasonable, affordable and should not be exorbitant taking into consideration the objectives of the corporation and the capability of the members. The necessity and reasonableness thereof may be questioned by the members or any interested party, and when action against unreasonable assessment is prevented by the control of the Directors, relief may be at the instance of the members themselves or interested party through a formal complaint filed with the SEC pursuant to the provisions of PD 902-A, as amended, and SEC Revised Rules of Procedure .All actions filed with the Commission must be prosecuted and defended in the name of the real party in interest. Very truly yours, (SGD.) FE ELOISA C. GLORIA Associate Commissioner