Candido S. Gemina vs. Al Motor Works, Inc., et al.

[SEC-SICD * CASE NO. 2690. January 29, 1987.] CANDIDO S. GEMINA , petitioner , vs . AL MOTOR WORKS, INC., ET AL. , respondents . D E C I S I O N This is a petition for the revocation and cancellation of the certificate of incorporation of Al Motor Works, Inc., Registration No. 120377, which corporate name was formerly Dual Motor Works, Inc. The petitioner is an incorporator-director who allegedly was not duly notified of the meeting which passed and approved Board Resolution No. 001 effecting the change of name of the corporation. He further alleged that the amended Articles of Incorporation of Al Motor Works, Inc. was deliberately faked as the acknowledgment portion of the document appears to have been duly notarized when in truth and in fact, no such document was notarized before a notary public. The notarial docket numbers of the Articles of Incorporation of Dual Motor Works, Inc. (Doc. No. 233, page No. 48, Book No. 290, Series of 1984) were made to appear in the Amended Articles of Incorporation of the Al Motor Works, Inc. He also alleged discrepancies in the dates of the board resolution and the amended articles. Likewise, he claimed that the respondents violated their memorandum of agreement dated March 13, 1984, on the management of the corporation. LLphil On the other hand, respondents denied the operation of the motor repair shop as a "joint venture", that respondent Alberto E. Lim would have "exclusive authority to operate" the motor repair shop "without any interference" from herein petitioner whose inclusion in the corporation was "in consideration of the use of the trade name and license to operate a motor service shop". The petitioner was in fact granted only five (5) percent participation for this purpose. From the facts presented; the alleged lack of written notice to the petitioner-director would have rendered the meeting irregularly convened as contrary to the By-laws, # 8, Art. VII. However, "omission to notify those who have a technical title to stock but no real interest, all the real owners having had notice, is not material". (Guaranty Loan Co. v. Treadwell, 53 Cal. App. 538, 200 Pac. 653, cited in 5 Fletcher, p. 41). Paragraph 5 of the memorandum of agreement of the parties granted the petitioner only a five (5) percent participation in the venture in consideration of the use of his registered trade name and license to operate a motor service shop. The matter of alleged violation of the memorandum agreement not to change corporate name should be filed in the regular court, including the damages, if any, incurred thereto, the same not being within the jurisdiction of the Securities and Exchange Commission. As to the alleged falsified or faked supporting papers on the amended articles of incorporation, the Commission did not find any evidence to substantiate his allegation. The alleged falsified acknowledgement of the amended articles is actually that of the Dual Motor Inc. in support of the amendment as required by the Corporate Legal Department. WHEREFORE, the petition is hereby DISMISSED for lack of merit. SO ORDERED. (SGD.) MINVILUZ C. ASTUDILLO Hearing Officer