Santiago D. Ortega, Jr. vs. Saint Anthony Academy of Iriga, Inc., et al.

[SEC-SICD * CASE NO. 1295. August 15, 1988.] SANTIAGO D. ORTEGA, JR. , petitioner , vs .SAINT ANTHONY ACADEMY OF IRIGA, INC.,ET AL. , respondents . D E C I S I O N The petitioner who claims to be a member and the vice-president of respondent non-stock corporation brought this case before the Commission to have the dissolution of said corporation nullified, among others. dctai The individual respondents are impleaded in their capacity as directors of respondent corporation. Petitioner raises two noteworthy causes of action for the relief sought, to wit: a) failure of respondents to comply with the law's requirements on the sending of notice of meeting to some members including the petitioner herein and b) pendency of several claims against respondent corporation at the time of the disputed dissolution. In the instant petition, extrajudicial voluntary dissolution as contemplated under Section 62 of the old Corporation Law (Act 1459) was the mode of choice: Section 62 states in full, as follows: LLphil "In case the dissolution of a corporation does not affect the rights of any creditor having a claim against such corporation, then such dissolution may be effected by a resolution duly adopted by the affirmative vote of two-thirds of the members or of the stockholders owning at least two-thirds of its capital stock outstanding at a meeting to be held on the call of the directors after publishing notice of the time, place and object of the meeting for six consecutive weeks in some newspaper published in the place where the said corporation is located and if no such newspaper is published in the place then in some newspaper of general circulation in the Philippines, and after sending such notice to each stockholder of record by registered mail at least thirty days prior to said meeting. A copy of the resolution authorizing the dissolution shall be certified by a majority of the board of directors and countersigned by the secretary or clerk of said corporation and filed with the Securities and Exchange Commission. The Securities and Exchange Commission shall thereupon record the fact of such dissolution and shall collect for such service the sum of twenty-five pesos, Philippine Currency." Thus, the requirements of an extrajudicial voluntary dissolution under the afore-quoted provision consists of the following: 1) There must be a meeting called by the directors and notice of which must be given by newspaper publication and by registered mail; 2) There must be a resolution duly adopted by the affirmative vote of two-thirds of the members or of the stockholders owning at least two-thirds of its capital stock outstanding; and 3) A copy of the resolution authorizing the dissolution shall be certified by a majority of the Board of Directors and countersigned by the secretary. Obviously, the prescribed mode may be resorted to only in case the dissolution of a corporation does not affect the rights of any creditor having a claim against such corporation. That there were several pending claims (Exhs. "L", "M", "N", "P" and their sub-exhibits) against respondent corporation, at the time of the assailed dissolution, is well articulated by hard evidence consisting of complaints and other pleadings filed in court against the said respondent corporation. Resorting to extrajudicial voluntary dissolution therefore, indubitably contravenes Section 62 of Act 1459. Likewise, evidence adduced by petitioner tend to show that indeed respondents failed to comply with the law's requirement regarding the sending of notices to the members of the corporation, one of whom is the petitioner. True, there was publication in the Nueva Era (Exhs. "9" through "9-f-1") of the requisite notice of the meeting whereby the resolution to dissolve was allegedly arrived at. It may also be conceded that the "Nueva Era" is a newspaper of general circulation in the common acceptance of the term. However, such publication must be coupled with the sending of the notice to each and every member. This, the evidence renders beyond doubt, was not done. Aside from petitioner, four witnesses (Rev. Fr. Francisco Gianan, Mr. Cecilio Bacana, Atty. Gilbert Isaac and Gregorio Sanchez),whose membership in respondent corporation at the time of dissolution is not disputed, testified that they were not given notice of the questioned dissolution. No reason exists for not giving full credit to these four persons. Especially credit-worthy was Rev. Fr. Gianan who, aside from being a cleric, is in his twilight years and hence, should be less inclined to contrive false testimony against any person. Significantly, Mrs. Gregoria Sanchez, one of the respondents, went on record with the admission that despite her being the secretary at the time, she was not aware of any notice of the June 16, 1973 meeting that was sent out. Even more telling is Mrs. Sanchez' testimony that the supposed meeting of June 18, 1973 did not really take place. To what these four witnesses deposed in corroboration of plaintiff, the uncorroborated testimony of respondent Leonida B. Ortega, respondent's one and only witness, must yield. Considering the evidence adduced by the parties and the applicable law, there is merit in the petition. WHEREFORE, the petition is granted as the voluntary dissolution of the St. Anthony's Academy of Iriga, Inc. purported to have been effected by virtue of the "Certificate of Dissolution" filed with the Commission on June 20, 1973 is hereby declared a nullity and without legal effect. Let copy of this "Decision" be furnished the Corporate and Legal Department for its information and guidance and a copy likewise furnished the Records Division to be attached to and shall form part of the record of the Corporation concerned. SO ORDERED. (SGD.) BERNARDO T. ESPEJO Hearing Officer