* DD .

55

G.R. N . 170585. O b 6, 2008.* . 567, C B 6, 2008 559

La . La
DAVID C. LAO and JOSE C. LAO, petitioners, .
DIONISIO C. LAO, respondent.
document is the owner of a designated number of shares of its
stock. It is i a facie evidence that the holder is a shareholder of
C ; J dge ; Di a ifica i a d I hibi i f J dge ; I a corporation.
ca e f a i hibi i , he a ea e he d di c e i
f he j dge he deci i decide f hi e f he e i f Sa e; A be ee he Ge e a I f ai Shee a d he
he he he i i hibi hi e f f he ca e. In cases of c ae b , i i he a e ha i c i g. Petitioners
voluntar inhibition, the law leaves to the sound discretion of the bank heavil on the General Information Sheet submitted b
judge the decision to decide for himself the question of whether or PFSC to the SEC in which the were named as shareholders of
not he will inhibit himself from the case. Section 1, Rule 137 of PFSC. The claim that respondent is now estopped from
the Rules of Court provides: Section 1. Di a ifica i f j dge . contesting the General Information Sheet. While it ma be true
No judge or judicial officer shall sit in an case in which he, or that petitioners were named as shareholders in the General
his wife or child, is pecuniaril interested as heir, legatee, Information Sheet submitted to the SEC, that document alone
creditor, or otherwise, or in which he is related to either part does not conclusivel prove that the are shareholders of PFSC.
within the si th degree of consanguinit or affinit , or to counsel The information in the document will still have to be correlated
within the fourth degree, computed according to the rules of the with the corporate books of PFSC. As between the General
civil law, or in which he has been e ecutor, administrator, Information Sheet and the corporate books, it is the latter that is
guardian, trustee, or counsel, or in which he has presided in an controlling.
inferior court when his ruling or decision is the subject of review,
PETITION for re ie on certiorari of an amended decision
without the written consent of all parties in interest, signed b
of the Court of Appeals.
them and entered upon the record. A judge ma , i he e e ci e f
The facts are stated in the opinion of the Court.
hi d di c e i , di a if hi e f f i i g i a ca e, f
R e C. Dela C for petitioners.
j a id ea he ha h e e i ed ab e.
Adeli B. Si collaborating counsel for petitioner.
C ai La ; A ce ifica e f c i he e ide ce f a Fidel Thadde I. B ja and J a ha C. Aba for
h de i e e a d a i a c ai i i i a facie respondent.
e ide ce ha he h de i a ha eh de f a c ai .
Petitioners insist that the are shareholders of PFSC. The claim REYES, R.T., J.:
purchasing shares in PFSC. Petitioner David Lao alleges that he IS the mere inclusion as shareholder in the General
acquired 446 shares in the corporation from his father, Lao Pong Information Sheet of a corporation sufficient proof that one
Bao, which shares were previousl purchased from a certain is a shareholder in such corporation?
Hipolito Lao. Petitioner Jose Lao, on the other hand, alleges that This is the main question for resolution in this petition
he acquired 333 shares from respondent Dionisio Lao. Records, for re ie on ce i a i of the Amended Decision1 of the
however, disclose that petitioners have no certificates of shares in Court of
their name. A certificate of stock is the evidence of a holder s
interest and status in a corporation. It is a written instrument _______________
signed b the proper officer of a corporation stating or
acknowledging that the person named in the 1 R ll , . 44-53. Pe ed b A cae J ce E c A. La a a ,
h A cae J ce Se a d E. V a d V ce e L. Ya ,
c c g. 4 Id., a . 72-73.
5 Id., a . 73.
560
561

560 E EC E A A ED
. 567, C BE 6, 2008 561
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Appeals (CA) affirming the Decision2 of the Regional Trial
Court (RTC), Branch 11, Cebu Cit in CEB-25916-SRC. transferred to the RTC in Cebu Cit and docketed as Ci il
Case No. CEB-25916-SRC. The case as consolidated ith
The Fac another intra-corporate dispute, Ci il Case No. CEB-
25910-SRC, filed b the Heirs of U Lam Tiong against
On October 15, 1998, petitioners Da id and Jose Lao respondent Dionisio Lao.6
filed a petition ith the Securities and E change During pre-trial, the parties agreed to submit the case
Commission (SEC) against respondent Dionisio Lao, for resolution based on the e idence on record.7
president of Pacific Foundr Shop Corporation (PFSC).
Petitioners pra ed for a declaration as stockholders and RTC Di ii
directors of PFSC, issuance of certificates of shares in their
name and to be allo ed to e amine the corporate books of On December 19, 2001, the RTC rendered a Joint
PFSC.3 Decision8 ith the follo ing pertinent disposition, thus:
Petitioners claimed that the are stockholders of PFSC
based on the General Information Sheet filed ith the WHEREFORE, in view of the foregoing premises, judgment is
SEC, in hich the are named as stockholders and hereb rendered b the Court in these cases:
directors of the corporation. Petitioner Da id Lao alleged (a) Den ing the petition of David C. Lao and Jose C. Lao to be
that he acquired 446 shares in PFSC from his father, Lao recogni ed as stockholders and directors of Pacific Foundr Shop
Pong Bao, hich shares ere pre iousl purchased from a Corporation, to be issued certificates of stock of said corporation
certain Hipolito Lao. Petitioner Jose Lao, on the other and to be allowed to e ercise rights of stockholders of the same
hand, alleged that he acquired 333 shares from respondent corporation. 9
Dionisio Lao himself.4 In den ing the petition, the RTC ratiocinated:
Respondent denied petitioners claim. He alleged that
the inclusion of their names in the corporation s General Thus, the petitioners David C. Lao and Jose C Lao do not
Information Sheet as inad ertentl made. He also appear to have become registered stockholders of Pacific Foundr
claimed that petitioners did not acquire an shares in Shop corporation, as the do not appear to have acquired shares
PFSC b an of the modes recogni ed b la , namel of stock of the corporation either as subscribers or b purchase
subscription, purchase, or transfer. Since the ere neither from a holder of outstanding shares or b purchase from the
stockholders nor directors of PFSC, petitioners had no right corporation of additionall issued shares.
to be issued certificates or stocks or to inspect its corporate
books.5 Secondl , the claim or contention of the petitioners David C.
On June 19, 2000, Republic Act 8799, other ise kno n Lao and Jose C. Lao is wanting in merit because he ha e
as the Securities Regulation Code, as enacted, c ce ifica e i hei a e . A stock certificate, as we ver
transferring jurisdiction o er all intra-corporate disputes well know, is the evidence of ownership of corporate stock. If ever
from the SEC to the RTC. Pursuant to the la , the petition the said peti-
ith the SEC as

_______________
6 Id., . 73-74.
2 Id., a . 148-154. Pe ed b J dge I a a D cd ca . 7 Id., . 74.
3 Id., a . 45. 8 Id., . 148-154.
 9 Id., . 153-154. 10 Id., . 152-153.
11 Id., . 72-80.
5 2
5 3

562 C A A D
La . La . 567, C B 6, 2008 563
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tioners acquired shares of stock of the corporation, there is a need
for their acquisition of said shares to be registered in the Stock (a) Declaring that petitioners have owned since 1987 shares
and Transfer Book of the corporation. Registration is necessar to of stock in Pacific Foundr Shop Corporation, numbering 446 for
entitle a person to e ercise the rights of a stockholder and to hold petitioner-appellant David C. Lao and 333 for petitioner-appellant
office as director or other offices (12 Fletcher 343). That is wh it Jose C. Lao;
is e plicitl provided in Section 63 of the Corporation Code of the (b) Ordering respondent-appellee through the corporate
Philippines that no transfer of shares of stock shall be valid until secretar to issue to petitioners-appellants the certificates of stock
the transfer is recorded in the books of the corporation. An for the aforementioned number of shares;
unregistered transfer is not valid as against the corporation (U (c) Ordering respondent-appellee, as President of Pacific
. Di i , 61 Phil. 535). A transfer must be registered, or at Foundr Shop Corporation, to allow petitioners-appellants to
least notice thereof given to the corporation for the purpose of e ercise their rights as stock holders;
registration, before the transferee can acquire an right as (d) Ordering respondent-appellee to call a stockholders
against the corporation other than the right to have the transfer meeting ever fourth Saturda of Januar in accordance with the
registered (12 Fletcher 339). An unrecorded transferee can not B -Laws of Pacific Foundr Shop Corporation. 12
enjo the status of a stockholder, he can not vote nor he voted for
(P ice & S De e e C . . Ma i , 58 Phil. 707). Until The CA decision as penned b Justice Arsenio Magpale
the transfer is registered, the transferee is not a stockholder but and concurred in b Justices Sesinando Villon and Enrico
an outsider (Ri e a . F e d , G.R. No. L-57586, October 8, Lan anas.
1986). So, a person who has acquired or purchased shares of stock In modif ing the RTC decision, the appellate court ga e
of a corporation, and who desires to be recogni ed as stockholder credence to the General Information Sheet submitted b
for the purpose of voting and e ercising other rights of a petitioners that names them as stockholders of PFSC, thus:
stockholder, must secure such a standing b having the
The General Information Sheet of PFSC for the ears 1987-
acquisition or transfer recorded in the corporate books (P ice &
1998 state that petitioners-appellants David C. Lao and Jose C.
S de e e C . . Ma i , a). Unfortunatel , in the
Lao own 446 and 333 shares, respectivel , in PFSC. It is also
cases at bench, the petitioners David C. Lao and Jose C. Lao did
indicated therein that David C. Lao occupied various ke
not secure such a standing. Consequentl , their petition to be
positions in PFSC from 1987-1998 and Jose C. Lao served as
recogni ed as stockholders of Pacific Foundr Shop Corporation
Director in PFSC from 1990-1998. The Sworn Statements of U
must fail. 10
Lam Tiong, former corporate secretar of the PFSC, also state
Petitioners appealed to the CA. that petitioners-appellants David C. Lao and Jose C. Lao, per
corporate records of PFSC, own shares of stock numbering 446
CA Di ii and 333, respectivel . The minutes of the Annual Stockholders
Meeting of PFSC on Januar 28, 1988 at 3:00 o clock p.m. shows
On Ma 27, 2005, the CA rendered a Decision11 that among those present were petitioners-appellants David C.
modif ing that of the RTC, disposing as follo s: Lao and Jose C. Lao. During the said meeting, petitioner-
appellant David C. Lao was nominated and elected Director of
WHEREFORE, premises considered, judgment is hereb
PFSC. Withal, the Minutes of the Meeting of the Board of
rendered modif ing the Joint Decision dated December 19, 2001
Directors of PFSC at its Office at Hipodromo, Cebu Cit , on
of the trial court in so far as it relates to Civil Case No. CEB-
Januar 28, 1988 at 4:00 p.m. disclose that petitioner-appellant
25916-SRC b :
David C. Lao
 12 Id., . 79-80. . 567, C BE 6, 2008 565
5 4 La . La

564 C A A D The Amended Decision as penned b Justice Enrico

Lan anas and concurred in b Justices Sesinando Villon
La . La
and Vicente Yap. The CA stated:
was elected vice-president of PFSC. Both minutes were signed Petitioners-appellants maintain that the acquired their
b the officers of PFSC including respondent-appellee. 13 shares of stocks through transfer the third mode mentioned b
the trial court. David C. Lao claims that he acquired his 446
Respondent filed a motion for reconsideration14 of the shares through his father, Lao Pong Bao, when the latter
CA decision. purchased said shares from Hipolito Lao. On the other hand, Jose
On Jul 11, 2005, respondent mo ed to inhibit15 the C. Lao asserts that he acquired his 333 shares through Dionisio
e e of the CA decision, Justice Magpale, from resol ing C. Lao himself from the original 1,333 shares of stocks of the
his pending motion for reconsideration. latter.
On Jul 22, 2005, Justice Magpale issued a Resolution16 Petitioner-appellants asseverations are unavailing. To
l a il i hibi i g himself from further participating in substantiate their statements, the merel relied on the General
the resolution of the pending motion for reconsideration. Information Sheets submitted to the Securities and E change
Justice Magpale stated: Commission for the ear 1987 to 1998, as well as on the Minutes
Although the undersigned e e does not agree with the of the Stockholders Meeting and Board of Directors Meeting held
imputations of respondent-appellee and that the same are not an on Januar 28, 1988. The did not adduce evidence that would
of those grounds mentioned in Rule 137 of the Revised Rules of indubitabl show that there was indeed a valid transfer of stocks,
Court, nonetheless the e e voluntaril inhibits himself from i.e. endorsement and deliver , from the transferors, Hipolito Lao
further handling this case in order to free the entire court of the and Dionisio Lao, to them as transferees.
slightest suspicion of bias and prejudice against the respondent-
appellee. 17 To our mind, David C. Lao utterl failed to confute the
argument posited b respondent-appellee or demonstrate
A e ded Deci i compliance with an of the statutor requirements as to warrant
a favorable ruling on his part. No proof was ever shown that there
On August 31, 2005, the CA rendered an Amended was endorsement and deliver to him of the stock certificates
Decision18 affirming that of the RTC, ith a fall reading: representing the 446 shares of Hipolito Lao. Neither was the
transfer registered in PFSC s Stock and Transfer Book.
IN VIEW OF THE FOREGOING, the Ma 27, 2005 Decision
Conversel , Dionisio C. Lao was able to show conformit with the
of this Court is hereb SET ASIDE and the Decision of the
aforementioned requirements. Accordingl , it is but logical to
Regional Trial Court, Branch 11, Cebu Cit with respect to Civil
conclude that the certificate of stock covering 446 shares of
Case No. 25916-SRC is hereb AFIRMED i . 19
Hipolito Lao was in fact endorsed and delivered to Dionisio C. Lao
and as such is reflected in PFSC s Stock and Transfer Book .
_______________ In fact, it is a rule that private transactions are presumed to have
been faire and regular and that the regular course of business is
13 Id., a . 77-78.
presumed to have been followed. Thus, the transfer made b
14 Id., a . 81-91.
Hipolito Lao of the 446 shares of stocks to Dionisio C. Lao is
15 Id., a . 92-93.
deemed to have been valid and well-founded unless proven
16 Id., a . 41-42.
otherwise. David C. Lao s mere allegation that Dionisio Lao
17 Id., a . 41.
illegall appropriated upon himself the 446 shares failed to hurdle
18 Id., a . 41-53.
such presumption. In
19 Id., a . 52.
5
565

566 C A A D
 . 567, C B 6, 2008 567
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this jurisdiction, neither fraud nor evil is presumed and the
record does not show either as to establish b clear and sufficient 2. Whether or not the inhibition of Justice Magpale
evidence that ma lead Us to believe such allegation. The part constitutes, in effect, forum shopping, which is proscribed under
alleging the same has the burden of proof to present evidence Section 5, Rule 7 of the Rules of Court, as amended, and decisions
necessar to establish his claim, unfortunatel however of this Honorable Court.
petitioners failed to do so. The General Information Sheets and 3. Whether or not determination of ownership of shares of
the Minutes of the Meetings adduced b petitioners-appellants do stock in a corporation shall be based on the Stock and Transfer
not prove such allegation of fraud or deceit. In the absence Book alone, or other evidence can be considered pursuant to the
thereof, the presumption remains that private transactions have decision of this Honorable Court in Ta . Sec i ie a d
been fair and regular. E cha ge C i i , 206 SCRA 740.
As for the alleged shares of Jose C. Lao, We find his position 4. Whether or not the admissions and representations of
identicall situated with David C. Lao. There is also no evidence respondent in the General Information Sheets submitted b him
on record that would clearl establish how he acquired said to the Securities and E change Commission during the ears
shares of PFSC. Jose C. Lao failed to show that there was 1987 to 1998 that (a) petitioners were stockholders of Pacific
endorsement and deliver to him of the stock certificates or an Foundr Shop Corporation; that (b) petitioner David C. Lao and
documents showing such transfer or assignment. In fact, the 333 Jose C. Lao owned 446 and 333 shares in the corporation,
shares being claimed b him is still under the name of Dionisio C. respectivel ; and that (c) petitioners had been directors and
Lao was reflected b the Certificate of Stock as well as in PFSC s officers of the corporation, as well as the Sworn Statement of U
Stock and Transfer Book. Corollar , Jose C. Lao could not be Lam Tiong, former Corporate Secretar , the Minutes of the
considered a stockholder of PFSC in the absence of support Annual Stockholders Meeting of PFSC on Januar 28, 1988, and
reflecting his right to the 333 shares other than the inclusion of the Minutes of Meeting of the Board of Directors on Januar 28,
his name in the General Information Sheets from 1987 to 1998 1988, mentioned b Justice Magpale in his e cia, are
and the Minutes of the Stockholder s Meeting and Board of sufficient proof of petitioners ownership of stocks in the
Director s Meeting. 20 corporation.
5. Whether or not respondent is stopped from questioning
Petitioners mo ed for reconsideration but their motion petitioners ownership of stocks in the corporation in view of his
as denied.21 Hence, the present petition for re ie on admissions and representations in the General Information
ce i a i under Rule 45 of the 1997 Rules of Ci il Sheets he submitted to the Securities and E change Commission
Procedure. from 1987 to 1998 that petitioners were stockholders and officers
I e of the corporation. 22
Petitioners raise fi e (5) issues for Our consideration,
thus: Essentiall , onl t o (2) issues are raised in this
petition. The first concerns the oluntar inhibition of
1. Whether or not the inhibition of Justice Arsenio J. Justice Magpale, hile the second in ol es the substanti e
Magpale is proper when there is no e trinsic evidence of bias, issue of hether or not petitioners are indeed stockholders
bad faith, malice, or corrupt purpose on the part of Justice of PFSC.
Magpale, which is required b this Honorable Court in its decision
in Webb, e a . . Pe e f he Phi i i e , 276 SCRA 243 [1997], O R li g
as basis for disqualification.
We den the petition.

_______________
20 Id., . 48-51.
21 Id., . 55-56. 22 Id., a . 279-281.

5 56
568 E EC E A A ED La . La
La . La
in hich he feels that he is not holl free, disinterested,
impartial, and independent.
Voluntary inhibition is within the sound
We agree ith petitioners that it ma seem unpalatable
discretion of a judge.
and e en re olting hen a losing part seeks the
Petitioners claim that the motion to inhibit Justice
disqualification of a judge ho had pre iousl ruled against
Magpale from resol ing the pending motion for
him in the hope that a ne judge might be more fa orable
reconsideration as improper and unethical. The assert
to him. But We cannot take that basic proposition too far.
that the bias and prejudice grounds alleged b pri ate
That Justice Magpale opted to oluntaril recuse himself
respondent ere unsubstantiated and, orse, constituted
from the appealed case is alread fai acc li. It is, in
proscribed forum shopping. The argue that Justice
popular idiom, ater under the bridge.
Magpale should ha e resol ed the pending motion, instead
Petitioners cannot bank on his oluntar inhibition to
of oluntaril inhibiting himself from the case.
nullif the Amended Decision later issued b the appellate
In cases of oluntar inhibition, the la lea es to the
court. It is highl specious to assume that Justice Magpale
sound discretion of the judge the decision to decide for
ould ha e ruled in fa or of petitioners on the pending
himself the question of hether or not he ill inhibit
motion for reconsideration if he took a different course and
himself from the case. Section 1, Rule 137 of the Rules of
opted to sta on ith the case. It is also illogical to presume
Court pro ides:
that the Amended Decision ould not ha e been issued
Section 1. Di a ifica i f j dge . No judge or judicial ith or ithout the participation of Justice Magpale. The
officer shall sit in an case in which he, or his wife or child, is Amended Decision is too far remo ed from the issue of
pecuniaril interested as heir, legatee, creditor, or otherwise, or in oluntar inhibition. It does not follo that petitioners
which he is related to either part within the si th degree of ould be better off ere it not for the oluntar inhibition.
consanguinit or affinit , or to counsel within the fourth degree, Petitioners failed to prove that they are
computed according to the rules of the civil law, or in which he shareholders of PSFC.
has been e ecutor, administrator, guardian, trustee, or counsel, or Petitioners insist that the are shareholders of PFSC.
in which he has presided in an inferior court when his ruling or The claim purchasing shares in PFSC. Petitioner Da id
decision is the subject of review, without the written consent of all Lao alleges that he acquired 446 shares in the corporation
parties in interest, signed b them and entered upon the record. from his father, Lao Pong Bao, hich shares ere
A judge ma , i he e e ci e f hi d di c e i , di a if pre iousl purchased from a certain Hipolito Lao.
hi e f f i i g i a ca e, f j a id ea he ha Petitioner Jose Lao, on the other hand, alleges that he
h e e i ed ab e. acquired 333 shares from respondent Dionisio Lao.
Records, ho e er, disclose that petitioners ha e no
Here, Justice Magpale oluntaril inhibited himself in certificates of shares in their name. A certificate of stock is
order to free the entire court [CA] of the slightest suspicion the e idence of a holder s interest and status in a
of bias and prejudice . 23 We certainl cannot nullif corporation. It is a ritten instrument signed b the proper
the decision of Justice Magpale recusing himself from the officer of a corporation stating or ackno ledging that the
case because that is a matter left entirel to his discretion. person named in
Nor can We fault him for doing so. No judge should preside
in a case 5 0

_______________ 570 E EC E A A ED
23 Id., a . 41. La . La

56
the document is the o ner of a designated number of
shares of its stock.24 It is i a facie e idence that the
. 567, C BE 6, 2008 569 holder is a shareholder of a corporation.
 Nor is there an ritten document that there as a sale A c ai e, Dionisio C. Lao was able to show through
of shares, as claimed b petitioners. Petitioners did not competent evidence that he is undeniabl the owner of the
present an deed of assignment, or an similar instrument, disputed shares of stocks being claimed b David C. Lao. He was
bet een Lao Pong Bao and Hipolito Lao; or bet een Lao able to validate that he has the ph sical possession of the
Pong Bao and petitioner Da id Lao. There is like ise no certificates covering the shares of Hipolito Lao. Notabl , it was
deed of assignment bet een petitioner Jose Lao and Hipolito Lao who properl endorsed said certificates to herein
pri ate respondent Dionisio Lao. Dionisio Lao and that such transfer was registered in PFSC s
Absent a ritten document, petitioners must pro e, at Stock and Transfer Book. These circumstances are more in accord
the er least, possession of the certificates of shares in the with the valid transfer contemplated b Section 63 of the
name of the alleged seller. Again, the failed to pro e Corporation Code. 25
possession. The failed to pro e the due deli er of the
certificates of shares of the sellers to them. Section 63 of The mere inclusion as shareholder of petitioners
the Corporation Code pro ides: in the General Information Sheet of PFSC is
insufficient proof that they are shareholders of the
Sec. 63. Ce ifica e f c a d a fe f ha e . The company.
capital stock of stock corporations shall be divided into shares for Petitioners bank hea il on the General Information
which certificates signed b the president or vice-president, Sheet submitted b PFSC to the SEC in hich the ere
countersigned b the secretar or assistant secretar , and sealed named as shareholders of PFSC. The claim that
with the seal of the corporation shall be issued in accordance with respondent is no estopped from contesting the General
the b -laws. Sha e f c i ed a e e a e a d Information Sheet.
a be a fe ed b de i e f he ce ifica e ce ifica e While it ma be true that petitioners ere named as
i d ed b he e hi a e -i -fac he e shareholders in the General Information Sheet submitted
ega a h i ed a e he a fe . No transfer, however, to the SEC, that document alone does not conclusi el
shall be valid, e cept as between the parties, until the transfer is pro e that the are shareholders of PFSC. The information
recorded in the books of the corporation so as to show the names in the document ill still ha e to be correlated ith the
of the parties to the transaction, the date of the transfer, the corporate books of PFSC. As bet een the General
number of the certificate or certificates and the number of shares Information Sheet and the corporate books, it is the latter
transferred. that is controlling. As correctl ruled b the CA:

In contrast, respondent as able to pro e that he is the We agree with the trial court that mere inclusion in the
o ner of the disputed shares. He had in his possession the General Information Sheets as stockholders and officers does not
certificates of stocks of Hipolito Lao. The certificates of make one a stockholder of a corporation, for this ma have come
stocks ere also properl endorsed to him. More to pass b mistake, e pedienc or negligence. As professed b
importantl , the respondent-appellee, this was done merel to compl with the
reportorial re-
_______________

24 De Le , The C a i n C de f he Phili ine Ann a ed, 2002

ed., . 550. 25 R , . 48.

5 1 5 2

572 C A A D
. 567, C BE 6, 2008 571
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quirements with the SEC. This ma be against the law but
transfer as dul registered in the stock and transfer book practice, no matter how long continued, cannot give rise to an
of the corporation. Thus, as bet een the parties, vested right.
respondent has pro en his right o er the disputed shares.
As correctl ruled b the CA:
 If a transferee of shares of stock who failed to register such
transfer in the Stock and Transfer Book of the Corporation could
not e ercise the rights granted unto him b law as stockholder,
with more reason that such rights be denied to a person who is
not a stockholder of a corporation. Petitioners-appellants never
secured such a standing as stockholders of PFSC and
consequentl , their petition should be denied. 26

It should be stressed that the burden of proof is on

petitioners to sho that the are shareholders of PFSC.
This is so because the do not ha e an certificates of
shares in their name. Moreo er, the do not appear in the
corporate books as registered shareholders. If the had
certificates of shares, the burden ould ha e been ith
PFSC to pro e that the are not shareholders of the
corporation.
As discussed, petitioners failed to hurdle their burden.
There is no ritten document e idencing their claimed
purchase of shares. We note that petitioners agreed to
submit their case for decision based merel on the
documents on record. Hence, no testimonial e idence as
presented to pro e the alleged purchase of shares. Absent
an documentar or testimonial e idence, the bare
assertion of petitioners that the are shareholders cannot
pre ail.
All told, We agree ith the RTC and CA decision that
petitioners are not shareholders of PFSC.
WHEREFORE, the petition is DENIED and the
appealed Amended Decision AFFIRMED IN FULL.
SO ORDERED.

Y a e -Sa iag (Chai e ), A ia-Ma i e ,

Chic -Na a i and Nach a, JJ., concur.

Pe i i de ied, a e ded deci i affi ed i f ll.

_______________

26 Id., a . 51-52.

C g 2021 Ce a B S , I c. A g e e ed.