In Re: Petition for Deletion of The name "ST. CYR" from The Corporation name of The Lycee D'ST. CYR, Inc.

[SEC-SICD * CASE NO. 2765. May 22, 1987.] IN THE MATTER OF THE PETITION FOR DELETION OF THE NAME "ST. CYR" FROM THE CORPORATION NAME OF THE LYCEE D' ST. CYR, INCORPORATED ST. CYR ACADEMY, INC. , petitioner , vs .LYCEE D' ST. CYR, INCORPORATED , respondent . D E C I S I O N This case is a petition instituted by petitioner, St. Cyr Academy, Inc. a corporation organized and existing under the laws of the Philippines against Lycee D' St. Cyr Incorporated, which is likewise a domestic corporation for the deletion of the name St. Cyr from the corporate name of the respondent. LLphil Petitioner alleged, among others, that the former owners of minority shareholdings (but controlling members of the previous board of , five-directors) of St. Cyr Academy, Inc., namely, Lolita Masias, Juan Custodio and Macario Pascual are no longer connected with the petitioner, St. Cyr Academy, Inc.; after the buy-out of all their stockholdings in the company; that petitioner is offering elementary education, whereas, respondent which offers secondary education, has now engaged and opened its elementary education department styled under the name Regis Marie School, Lycee D' St. Cyr Elementary School: that by retaining the name "St. Cyr" first used by petitioner in the corporate name of respondent will surely cause more contusion or mistake in the minds of the public considering that the herein parties are now engaged in the same line of academic business, that is, in providing elementary education; that petitioner has acquired a prior right to the use of the corporate name "St. Cyr Academy, Inc." as it was duly registered with the Commission on April 12, 1972, whereas respondent Lycee D' St. Cyr, Incorporated was registered only on August 18, 1980, and the two entities are not owned by the same individual stockholders; that the use of the name "St. Cyr" by respondent in its corporate name is contrary to the provisions of Section 18 of the Corporation Code of the Philippines, which provides, as follows: "SECTION 18. Corporate name . No corporate name may be allowed by the Securities and Exchange Commission if the proposed name is identical or deceptively or confusingly similar to that of any existing corporation as to any other name already protected by law or is patently deceptive, confusing or contrary to existing laws. ... Further, that the continuous use of the name "St. Cyr" by the respondent in its corporate name will further prejudice the interest and further cause damage to the herein petitioner. Respondent in its answer denied all the material allegations in the petition, and alleged in the special and affirmative defense that the petition fails to state a valid cause of action; and the petitioner has no cause of action against the respondent. Respondent contends that petitioner does not have the exclusive right to use "St. Cyr" in its corporate name because the same is a generic name, like St. Joseph, not subject to the exclusive appropriation, and may be used as trademark or tradename in combination with other words or terms; that as a generic term, which is essentially and primarily merely a surname, it is not subject to exclusive appropriations; that this Commission has allowed the registration of the respondent without requiring the consent of the petitioner is a clear recognition of respondent's position that petitioner has no exclusive right to the generic or common name "St. Cyr";that the respondent is not in any way connected with the petitioner which the latter has entirely separate operations limited only to operate a kindergarten and primary education. On the other hand, respondent is engaged in the operations of school for high school education, as well as for the pre-school and elementary education; that there is no confusion of identity between the names of the petitioner and the respondent because their separate operations, management, style and character of respective owners are well-known in the community; and that the respondent performs its functions of delivering quality education to the community with due regard and concern to the welfare and well-being of the public and the teachers, but petitioner continues with its relentless campaigns of harassment for which the request for deletion of St. Cyr from its corporate name is only an insignificant part. In support thereof, petitioner presented testimonial and documentary evidence consisting of, among others: 1. Exhibit "A",affidavit of Mr. Eduardo P. de Leon showing that petitioner was registered ahead of the respondent; 2. Exhibit "B",letter complaint filed by the President of petitioner dated 22, January 1985 addressed to the Director, Ministry of Education and Culture, showing that petitioner opposed the opening of the elementary school of the respondent Regis Marie D' St. Cyr which is 100 meters away from the petitioner which cause confusion in the minds of the public because of the use of words "St. Cyr"; 3. Exhibit "C",letter answer of the President of the petitioner showing that the respondent through its President is willing to delete the words St. Cyr to avoid confusion; 4. Exhibits "D" and "D-2",pictures containing bold letters of the names Lycee D' St. Cyr posted in front of the newly opened elementary branch Regis Marie Lycee D' St. Cyr showing that respondent has given more emphasis on the name St. Cyr; 5. Exhibit "E",charge invoice of Book Mark showing that the school materials were ordered by the petitioner, however through mistake the name of respondent was reflected in the said charge invoice; 6. Exhibits "F","F-1",the wholesale invoice of National Book Store No. 003041 showing that it was reflected therein that the books were ordered by petitioner but actually the books were for high school ordered by the respondent. On the other hand, respondent notwithstanding sufficient time, failed to present any evidence but merely manifested to submit his memorandum thereto. The issue to be resolved is whether or not the name of the respondent is identical or deceptively or confusingly similar with that of the petitioner. In the case at bar, we find that the corporate names of petitioner and the respondent are sufficiently identical or deceptively or confusingly similar. The probability of deception is aggravated by the fact that both corporations are engaged in similar line of academic business. Thus, it was held that the nature and business of the corporations involved are also important factors bearing on the likelihood of deception from the use of similar names (Fletcher Vol. 6).Besides, it was held unnecessary to show that anyone had actually been misled by similarity in names, and that it was sufficient that the use of name was likely to produce deception. (Churchill Downs Inc. 262 Ky. 567 90 S. W. (2d) 1041 Fletcher Vol. 6). Moreover, there is not much distinction between the corporate names of the petitioner and respondent that will thereby mislead the public into belief that the two corporations are one and the same. The lack or absence of proof of actual confusion or deception of the public is immaterial since actual confusion need not be shown, but it is sufficient that confusion is probable or likely to occur. (Weiskittel & Son Co. v. Harry C. Weiskittel & Son Co. 167 md. 306, 173 Atl. 48 Fletcher Vol. 6).It appearing that the corporate names in question clearly resemble each other principally on the use of words "St. Cyr",deception or confusion therefore, is probable to occur. We find no sufficient basis for respondent's contention that since the Securities and Exchange Commission has allowed the registration of the respondent without requiring the consent of the petitioner is a clear recognition of respondent's position that petitioner has no exclusive right to the generic or common "St. Cyr", considering that Section 18 of the Corporation Code, neither the written undertaking of the respondent to change its corporate name does not indicate a time within to change its name in the event that another entity has already acquired a better right to the use of the name. From the evidence adduced it was established that petitioner was registered ahead of the respondent. Since incorporation gives protection to the name of the corporation, petitioner being the first registrant has priority of use and is, therefore, entitled to protection under the law. LLphil WHEREFORE, respondent Lycee D' St. Cyr, Incorporated, is hereby ordered to change its corporate name to another name not similar to any name already used by a corporation, partnership or association registered with this Commission, by amending its articles of incorporation in accordance with the Corporation Code of the Philippines and filing the same with this Commission, upon payment of the corresponding filing fees thereof, within thirty (30) days from finality hereof. Let copy of this Decision be furnished the Corporate and Legal Department of this Commission for its reference. SO ORDERED. (SGD.) ENRIQUE L. FLORES, JR. Hearing Officer