Ramon De Leon, et al. vs. Pepito Brillantes, et al.

[SEC-SICD * CASE NO. 5443. September 1, 1998.] RAMON DE LEON, ET AL. , petitioners , vs .PEPITO BRILLANTES, ET AL. , respondents . D E C I S I O N Petitioners in the instant case sought action of this Commission praying that the respondents be ordered to make accounting of all the funds collected by them from the drivers/operators; declaring as unlawful and unreasonable the increase in membership fees and daily contributions; enjoining the respondents from collecting membership fees and daily contributions and boundary terminal fees; ordering the revocation of the certificate of registration of the association, and. allowing the petitioners to organize themselves into another non-stock corporation. prcd Records of the case showed that the Petitioners are bonafide members of the PRC PASONG TAMO MANTRADE DRIVERS & OPERATORS ASSOCIATION, INC.,(PASODA, for short),a non-stock, non profit corporation duly registered under existing laws. The respondents on the other hands are likewise members of PASODA. They are being sued in their capacity as incumbent members of the Board of Trustees and corporate officers of the Association. It appears from the record that PASODA was incorporated sometime in March 1985, as evidenced by SEC by Reg. Certificate No. 125345 dated March 8, 1985. Petitioners alleged that the respondents started collecting membership fees from its member in 1984 in the amount of P200.00 instead of P20.00 as provided for in the By-laws, and collecting daily contribution (butaw) of P7.00 instead of P5.00 from the members. Likewise. the respondents. it was alleged are collecting from the members daily boundary terminal fees in the average amount of P480.00/day. Beginning 1994, the jeepney operators are required to pay membership fees ranging from P3,000.00 to P5,000.00. Petitioners alleged that these corporate acts are done without the consent of the members of the associations. No amendment has been made to the associations By-laws and therefore, whatever changes and /or increases in the collections is in direct violation of their By-laws. llcd The Petitioners likewise alleged that the Association has no financial statement beginning 1994 to the present, hence Petitioners demanded from the Respondents, access to PASODA'S books of accounts and its corporate records. However, the demand for examination and inspection of the corporate books of account was denied by the respondents. Confronted by these allegations the respondents interposed solely the defense that they are not officers/members of PASODA. Respondents argued that they are members/officers of PRC PASONG TAMO EXTENSION KAYAMANAN OPERATORS AND DRIVERS ASSOCIATION, INC.,(KAYAMANAN-C, for brevity) and as such, have nothing to do with the affairs of PASODA. When the respondents did not submit their formal offer of evidence despite the lapse of the period contained in the Order, the respondent's documentary evidences/exhibits were ordered expunged from the records of the case. (Order dated February 25, 1998).This Hearing Officer therefore, is constrained to rule on the matter on the basis of the evidences, both oral and documentary, adduced by the Petitioners. Clearly, the Petitioners sufficiently established their causes of action against respondents. Evidence on records showed that: 1. Contrary to the denials made by respondents Brillante and Espanola, the evidence shows that the respondents names appeared in the Articles of Incorporation and By-laws of PASODA ( Exh "A" and "C"); LLphil 2. The Commission Order dated February 98, 1995 (issued by the Supervision and Monitoring Department of SEC) directing the Association to comply with the Commission's reportorial requirements, i.e.,non submission of General Information Sheet (GIS),Membership Book for non-stock Corporation and the Financial Statement (FS) strengthened the allegations of Petitioners that the respondents did not allow the former to inspect and examine the association's book of accounts because the responsible officers have no records ( Exh. "J"); 3. The testimonies of the witnesses Francisco Notarte, Ramon de Leon and Luzviminda Madeja sustained the truthfulness of the allegation in the Petition that changes were made in the collection of the members daily dues (butaw) and membership fees without the requisite amendments of PASODA'S By-laws and the consent of its members. The witnesses likewise testified that there was no holding of election of the Board of Trustees from 1994 to the present contrary to its By-laws that Members of the Board of Trustees shall hold office for a term of one (1) year until the election and qualification of their successors (Sec. 4 terms of office of the By-law). prcd The Corporation Code of the Philippines (BP 68) specifically section 74 thereof requires every corporation, stock or non-stock, to keep books and records at its principal office. Such records include record of all business transactions, minutes of all meetings of stockholders or members, minutes of all meetings of trustees and membership book, in case of non- stock corporation. The right of inspection of corporate books is recognized by express provision of the corporation law. Said provision states that the record of all business transaction of the corporation and the minutes of any meeting shall be open to the inspection of any director trustees or stockholders or member of the corporation at reasonable hours on business days (Section 74, par. 2 BP 68). Under Section 74 (par. 3) of same any officers or agent of the corporation who shall refuse to allow any director, trustees, stockholder or member of the corporation to examine and copy receipt from its records or minutes in accordance with the provisions of the Code, shall be liable for damages and in addition, shall be guilty of an offense which shall be punishable under Section 144 of the Code. LexLib Because of the respondents' failure to formally offer his evidence which were already identified and marked during the hearing, respondents exhibits were ordered expunged from the record of the case. And following the rule, exhibits which were rejected and expunged from the records of the case shall have no weight or probative value. WHEREFORE, in view of all the forgoing considerations, this Commission hereby orders the respondents: A.) To allow the Petitioners to inspect and examine the corporate book of accounts and for the respondents to make an accounting of all the funds collected from drivers/operators covering the period 1994 to present, within THIRTY (30) days from receipts hereof; B.) The collection being considered illegal, to refund to the members/operators the questioned collected sum of money in excess of those allowed by the associations By-laws (i.e. excess daily dues (butaw),membership fees and daily boundary terminal fees) within thirty (30) days from receipt hereof; C.) And enjoining the respondents from further collecting from the members the questioned collection referred herein-above. No pronouncement as to costs. SO ORDERED. (SGD.) ROMMEL G. OLIVA Hearing Officer