Re: Manila Board of Realtors Inc.

[SEC-SICD * CASE NO. 06-94-4796. May 14, 1996.] IN RE: PETITION TO ANNUL THE MEMBERS' MEETING AND ELECTION OF BOARD OF DIRECTORS OF THE MANILA BOARD OF REALTORS, INC. DATED 7 JUNE 1994 ERNESTO G. AMBROSIO, ET AL. , petitioners . D E C I S I O N Before this Commission for resolution is a petition filed on June 17, 1994, to annul the annual meeting of the members of the Manila Board of Realtors, Inc. (MBRI), and the election of the members of the Board of Directors, which were held on June 7, 1994, with a Prayer for Preliminary Prohibitory Injunction , to restrain the Directors-elect from performing acts, duties and responsibilities in connection with their respective positions, seeking damages, fees and costs. dctai The Manila Board of Realtors, Inc. (MBRI), is a non-stock association, duly registered with the Securities and Exchange Commission. It is governed by its By-Laws, as amended. (SEC REG. No. 7085, 26 December 1984) The annual meeting and the election of directors are governed by the provisions of Sections 22 to 28 of the By- Laws. The election process takes place in two stages: the direct primary election, and the final election. The direct primary election takes place on the first Tuesday of May, which in 1994 fell on May 3. The final election takes place during the annual general meeting which is usually held on the first Tuesday of June, which fell on June 7, 1994. Pursuant to Sec. 26 (c) of the By-Laws, before the direct primary election in 1994, then President Max Valerio appointed the Judges on Election with the approval of the Board: Oliver Morales, was appointed Chairman. (Exh. 2, Minutes of Special Meeting, Board of Directors, MBR April 4, 1994. At that time, petitioners did not question the appointment of Chairman Morales. Pursuant to the By-laws, prior to the primary election, the Corporate Secretary, Pat Vince Cruz, sent to all members in good-standing, notices and ballots, and the complete list of members in good standing, in alphabetical order. There were 96 members in good standing. All regular members in good-standing were automatically candidates to be voted upon. Members returned the ballots with their respective votes indicated. Members who garnered the twenty-two highest number of votes qualified for the final election. Both petitioners and respondents except Morales and Valerio) received the highest 22 numbers of votes cast and were declared elected at the direct primary election, held on May 3, 1994; hence, petitioners and respondents were declared nominees/candidates for directors at the final election on June 7, 1994. (Exh. 3, Certification of Oliver Morales. Chairman) Significantly, petitioners did not question the results of the direct primary election. The dispute arose during the second stage of the annual elections. Petitioners contend that there was a failure of election alleging that of 96 members in good standing, only twenty-two were actually notified and furnished with the ballots, in violation of Sec. 27 of the By-laws. (Petition, p. 8, par. 11). To support their claim, petitioners adduced the Certification of the Postmaster Renato Andaya, Manila Post Officer, which indeed shows that only 22 registered letters were mailed by the Corporate Secretary. (Annex B, Petition) To further bolster their claim, petitioners averred that some members, including some petitioners themselves, did not receive the notice nor the ballot for the annual general election. (Annex C to J, Petitioner). Petitioners presented the letter of petitioner Barcarse, then incumbent EVP, MBR, to the Chairman of the Committee on Elections, (Oliver A. Morales), protesting the lack of notice and non-receipt of ballots, and demanding, suspension and cancellation of the elections. (Ltr., dtd. June 7, 1994, Annex K, petition). Petitioners also presented the letter of petitioner Callao who protested to then incumbent President Max Valerio alleging that he had no authority to appoint Chairman Morales, and demanding that the annual elections be suspended or cancelled. (Ltd, June 7, 1994, Annex K-1, Petitioner) Despite these protests, the annual meeting and elections were held as scheduled. [supra]) Petitioners' contention are without merit. Records of the case disclose that Secretary PAT VINCE CRUZ, in a memorandum circular, published the results of the direct primary election which were canvassed on May 3, and sent Notices to the members of the time, date and place of the final elections (Exh. 4, MBR Memo Circular No. 93-94-014 dtd. May 14, 1994). The list of candidates for the final election was attached in alphabetical order. In the same memorandum, members were notified that the annual meeting was to be held at 6:30 in the afternoon on June 7, 1994 at the Philippine Columbian, Paco, Manila. (Exh. 4, Ibid) Significantly, petitioners did not deny receipt of said memorandum circular. One is therefore led to believe that concerned members, including petitioners, were duly notified of the impending election of June 7, 1996. Moreover, a second notice was sent to members on May 18, 1994. Secretary Pat Vince Cruz circulated the formal "Notice of Annual General Meeting" to members. (Memo Cir. No. 93-94-017, May 18, 1994) This Notice also reminded members of the previous announcement on the same subject. (Op Cit. Memo Cir. No. 93-94-014) (Exh. 5, Notice dtd. May 18, 1994). It bears emphasis that the second Notice (Notice of Annual General Meeting) were sent not only by registered mail, but also by ordinary mail, and by messenger. Evidence adduced by respondents included: Exh. 1, Minutes of Annual Meeting, June 7; Exh. 6 & 7, First and Second Certifications of Postmaster Endaya, Central Post Office, on the registered letters sent; see also, Affidavits of Bienvinido de Castro, President EGI, Rodolfo Ecarma, counsel, Philippine Trust Bank, Eduardo Zialcita, Director, PAG-IBIG, on Notices received via messenger, attached as Annexes 2, 3, 4, Answer, Respondents dtd. July 6, 1994; Exh. 12-B, Affidavit of Pat Vince Cruz, Secretary dtd. Sept. 14). Petitioners missed the point entirely. While it is true that only twenty-two (22) Notices were sent by registered mail, the other Notices were sent by ordinary mail, or by hand. All of said notices were sent at least 10 days prior to the annual general meeting on June 7, 1994. The Certification of Postmaster Andaya proves only that twenty-two ballots were sent by registered mail. Said Certification is not competent to prove, that only 22 Notices were sent by the Corporate Secretary. Petitioners grossly misunderstood the provisions of the By-laws, and the practice of the association. It has not been disputed that traditionally, the Secretary has been sending Notices by registered mail, ordinary mail or by messenger. This practice satisfies the requirements of the Code. Indubitably, the action of the Secretary complies with the provisions of Sec. 22 (a), and Sec. 27, of the By-Laws, which state, respectively: SECTION 22. General Meetings . . . . "(a) Notice. Notice of the time and place of the meeting shall be mailed by the Secretary at least five days before the date fixed at the address recorded in the roster of members . . ." Further, ballots were sent by the Secretary at least 10 days prior to the Annual Election. On May 27, 1994 the Secretary, by registered mail and ordinary mail , as well as, by messenger , sent ballots to members in good-standing, pursuant to Sec. 27, MBR By-Laws. Records of the case disclosed that there was a quorum. Registration of members and/or their proxies took place on June 7, 1994 at the Philippine Columbian Club, Paco, Manila, where the annual elections were held. At registration, the following fact were established: prcd Number of Members in Good Standing 96 Number of Members Attending 28 Number of Members Represented by proxies 27 Requirements for Quorum 48 Since the number of members personally present or represented by proxy totaled 55, representing a majority of the members in good-standing, there was quorum for the meeting. The MBRI By-Laws state: "A majority of the Realtor Members in good standing constitutes a quorum for the transaction of all business . . . Only realtors in good standing are entitled to vote at the Annual General Meeting." (Sec. 22[c]) Records further disclosed that the proceedings substantially complied with the Order of business in the By-Laws. (See Minutes, June 7, 1994, Annual General Meeting) After the registration, President Max Valerio called the meeting to order. He asked the Secretary of Proof of Notice, and she certified in the affirmative. He asked whether there was a quorum and she certified that there was. On motion duly made and seconded, the minutes of the previous meeting was approved. (See Exh. 1, Minutes of General Meeting; Exh. 12, Affidavit of President Max Valerio; Exh. 12-A, Affidavit of Oliver Morales, Chairman, Judges on Election; Exh. 12-B, Affidavit of Pat Vince Cruz, Secretary) At that point, pursuant to the Order of Business the Presiding Officer declared that the Canvass of elections take place. However, before the canvass was started, petitioners asked to be heard. They were accommodated. Grievances were aired and listened to. Those who claimed they did not receive ballots were given the same and allowed to vote. Petitioners were outvoted in their attempt to cause the cancellation of the meeting. Attempts at filibuster by petitioners were prevented. Finally, on motion made and duly seconded, the start of the canvass of votes was approved. From the evidence adduced by the parties, we find that the canvass was done in an orderly manner, and was not questioned by petitioners. Canvass of votes cast was finally completed only after 12:00 o'clock midnight. (See Minutes of General Meeting, June 7, 1994). Chairman Morales supervised the canvass of votes. He announced the following facts. Number of voting members 96 Number of ballots casts 83 Number of ballots invalidated 9 Number of valid ballots 74 The results of the canvass was immediately announced. Chairman of the Judges of Election, Realtor Oliver Morales, a man of outstanding reputation, highly respected in the realty industry and a professional of the highest order, proclaimed the winners: Bienvinido De Castro, Pat R. Vince Cruz, Danilo B. Magadia, Lourdes D. Castillo, Rodolfo A. Ecarma, Simeon Figueras, Kimmy Y. Lim, Jose A. Sabater, Petronilo Samson, Celestino Yokingco and Eduardo Zialcita. (See Exh. 10, Tally Sheet, June 7, 1994) After their proclamation, the elected directors took their oath before Chairman Morales. After their proclamation, the elected Directors met to elect the officers of the Manila Board of Realtors, Inc. from among themselves. The following were elected: President: Bienvinido B. de Castro; Executive Vice- President: Jose E. Sabater; Vice-President-Internal: Celestino. Yokingco; Vice-President-External: Petronilo Samson; Board of Secretary: Pat R. Vince Cruz; Assistant Secretary: Simeon F. Figuerra; Treasurer: Danilo B. Magadia; Asst. Treasurer: Kimmy Y. Lim; Auditor: Lourdes Castillo; Public Relations Officer: Eduardo Zialcita; Corporate Legal Counsel: Rodolfo A. Ecarma. It appears that it was the respondents who furnished the overwhelming evidence proving that a valid election took place. In sum, I conclude that evidence adduced by both parties revealed that Petitioners were not only properly notified, but were also present at the annual meeting; that they also participated actively in the proceedings. Equitably, the complaining members were given the opportunity to participate and to vote. By their own admissions, petitioners did not have the chance to question the proceedings. That petitioners were outvoted by the body in a meeting that had a quorum did not make the proceedings irregular. Subido, one of the petitioners, stayed until the adjournment of the meeting: she even congratulated the winners. I find it therefore, strange, that she is included as one of the petitioners. In view of the foregoing, this Hearing Officer holds, that the annual general meeting and elections of the Manila Board of Directors held on June 7, 1994 was conducted in a regular, fair and impartial manner, in accordance with the By-Laws of the Corporation and the Corporation Code. Accordingly, the instant petition is hereby dismissed for lack of merit. Likewise, respondents' compulsory counterclaims should also be, as they are hereby dismissed. (SGD.) MANUEL P. PEREA Hearing Officer