Atty. Juan De Ocampo

May 14, 2003 SEC OPINION NO. 21-03 Atty. Juan De Ocampo 7th Floor Telecoms Plaza 316 Sen. Gil J. Puyat Avenue Salcedo Village, Makati City Dear Atty. de Ocampo, This refers to your letter dated 17 March 2003, requesting the opinion of the Commission as to whether the fiduciary relationship that the directors assume vis--vis corporations includes their obligation to attend the board of director's meetings, and if so, what remedy, aside from Section 28 of the Corporation Code, can the stockholders/members avail of, in case the directors fail in such duty. Relative thereto, Section 23 paragraph 1 of the Corporation Code of the Philippines provides: "Sec. 23. The board of directors or trustees . Unless otherwise provided in this Code, the corporate powers of all corporations formed under this Code shall be exercised, all business conducted and all property of such corporations controlled and held by the board of directors . . ." The corporation is managed by the board of directors or trustees. It cannot act except through such management body. The stockholders are deemed to have consented to the management and control of the corporate business by the board of directors. (19 Am. Jur. 2d, pp. 525-526).As such, the management functions of the board of directors cannot be understated. Thus, the second paragraph of Sec. 25 provides: "Sec. 25. Corporate officers, quorum xxx xxx xxx The directors or trustees and officers to be elected shall perform the duties enjoined on them by law and by the by-laws of the corporation. ..:" On the basis only of what you presented in your letter, the only remedy is Section 28 of the Corporation Code. We hope we have clarified the matter. DaTEIc Very truly yours, (SGD.) VANES G. MALI-PAC General Counsel