This case has been cited 14 times or more.
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2016-01-20 |
LEONEN, J. |
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| A stockholder may suffer from a wrong done to or involving a corporation, but this does not vest in the aggrieved stockholder a sweeping license to sue in his or her own capacity. The determination of the stockholder's appropriate remedy—whether it is an individual suit, a class suit, or a derivative suit—hinges on the object of the wrong done. When the object of the wrong done is the corporation itself or "the whole body of its stock and property without any severance or distribution among individual holders,"[1] it is a derivative suit, not an individual suit or class/representative suit, that a stockholder must resort to. | |||||
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2016-01-20 |
LEONEN, J. |
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| Villamor further explained that a derivative suit "is an action filed by stockholders to enforce a corporate action."[84] A derivative suit, therefore, concerns "a wrong to the corporation itself."[85] The real party in interest is the corporation, not the stockholders filing the suit. The stockholders are technically nominal parties but are nonetheless the active persons who pursue the action for and on behalf of the corporation. | |||||
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2016-01-20 |
LEONEN, J. |
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| The avenues for relief are, thus, mutually exclusive. The determination of the appropriate remedy hinges on the object of the wrong done. When the object is a specific stockholder or a definite class of stockholders, an individual suit or class/representative suit must be resorted to. When the object of the wrong done is the corporation itself or "the whole body of its stock and property without any severance or distribution among individual holders,"[91] it is a derivative suit that a stockholder must resort to. In Cua, Jr. v. Tan:[92] | |||||
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2014-09-24 |
LEONEN, J. |
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| The Court has recognized that a stockholder's right to institute a derivative suit is not based on any express provision of the Corporation Code, or even the Securities Regulation Code, but is impliedly recognized when the said laws make corporate directors or officers liable for damages suffered by the corporation and its stockholders for violation of their fiduciary duties. In effect, the suit is an action for specific performance of an obligation, owed by the corporation to the stockholders, to assist its rights of action when the corporation has been put in default by the wrongful refusal of the directors or management to adopt suitable measures for its protection.[62] | |||||
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2014-09-24 |
LEONEN, J. |
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| While it is true that the basis for allowing stockholders to file derivative suits on behalf of corporations is based on equity, the above legal requisites for its filing must necessarily be complied with for its institution.[73] | |||||
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2014-09-24 |
LEONEN, J. |
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| Individual suits are filed when the cause of action belongs to the individual stockholder personally, and not to the stockholders as a group or to the corporation, e.g., denial of right to inspection and denial of dividends to a stockholder.[76] If the cause of action belongs to a group of stockholders, such as when the rights violated belong to preferred stockholders, a class or representative suit may be filed to protect the stockholders in the group.[77] | |||||
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2014-09-24 |
LEONEN, J. |
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| Individual suits are filed when the cause of action belongs to the individual stockholder personally, and not to the stockholders as a group or to the corporation, e.g., denial of right to inspection and denial of dividends to a stockholder.[76] If the cause of action belongs to a group of stockholders, such as when the rights violated belong to preferred stockholders, a class or representative suit may be filed to protect the stockholders in the group.[77] | |||||
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2014-09-24 |
LEONEN, J. |
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| Thus, in Cua v. Tan,[81] this court emphasized: . . . where the acts complained of constitute a wrong to the corporation itself, the cause of action belongs to the corporation and not to the individual stockholder or member. Although in most every case of wrong to the corporation, each stockholder is necessarily affected because the value of his interest therein would be impaired, this fact of itself is not sufficient to give him an individual cause of action since the corporation is a person distinct and separate from him, and can and should itself sue the wrongdoer. Otherwise, not only would the theory of separate entity be violated, but there would be multiplicity of suits as well as a violation of the priority rights of creditors. Furthermore, there is the difficulty of determining the amount of damages that should be paid to each individual stockholder.[82] | |||||
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2014-09-10 |
LEONARDO-DE CASTRO, J. |
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| In Cua, Jr. v. Tan,[22] the Court previously elaborated on the distinctions among a derivative suit, an individual suit, and a representative or class suit: A derivative suit must be differentiated from individual and representative or class suits, thus: | |||||
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2012-09-05 |
PEREZ, J. |
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| Suits by stockholders or members of a corporation based on wrongful or fraudulent acts of directors or other persons may be classified into individual suits, class suits, and derivative suits.[30] | |||||
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2012-06-18 |
PERALTA, J. |
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| Cua, Jr. v. Tan[17] differentiates a derivative suit and an individual/class suit as follows: A derivative suit must be differentiated from individual and representative or class suits, thus: | |||||
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2012-01-18 |
REYES, J. |
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| The finality of the NLRC's decision does not preclude the filing of a petition for certiorari under Rule 65 of the Rules of Court. That the NLRC issues an entry of judgment after the lapse of ten (10) days from the parties' receipt of its decision[36] will only give rise to the prevailing party's right to move for the execution thereof but will not prevent the CA from taking cognizance of a petition for certiorari on jurisdictional and due process considerations.[37] In turn, the decision rendered by the CA on a petition for certiorari may be appealed to this Court by way of a petition for review on certiorari under Rule 45 of the Rules of Court. Under Section 5, Article VIII of the Constitution, this Court has the power to "review, revise, reverse, modify, or affirm on appeal or certiorari as the law or the Rules of Court may provide, final judgments and orders of lower courts in x x x all cases in which only an error or question of law is involved." Consistent with this constitutional mandate, Rule 45 of the Rules of Court provides the remedy of an appeal by certiorari from decisions, final orders or resolutions of the CA in any case, i.e., regardless of the nature of the action or proceedings involved, which would be but a continuation of the appellate process over the original case.[38] Since an appeal to this Court is not an original and independent action but a continuation of the proceedings before the CA, the filing of a petition for review under Rule 45 cannot be barred by the finality of the NLRC's decision in the same way that a petition for certiorari under Rule 65 with the CA cannot. | |||||
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2011-10-19 |
SERENO, J. |
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| In any case, the subsequent actions of Urban Bank resulted in the ratification of Peña's authority as an agent acting on its behalf with respect to the Pasay property. By ratification, even an unauthorized act of an agent becomes an authorized act of the principal.[266] | |||||
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2011-02-23 |
PEREZ, J. |
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| Anent the third requisite, a writ of certiorari will not issue where the remedy of appeal is available to the aggrieved party. The party aggrieved by a decision of the Court of Appeals is proscribed from assailing the decision or final order of said court via Rule 65 of the Rules of Court because such recourse is proper only if the party has no plain, speedy and adequate remedy in the course of law.[8] Furthermore, certiorari cannot be availed of as a substitute for the lost remedy of an ordinary appeal.[9] | |||||