RFB 301 (Other Legal Issues in Business) : Atty. Arnold V. de Castro

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RFB 301

(Other Legal Issues in


Business)

Atty. Arnold V. De Castro


Other Legal Issues in Business

PERTINENT POINTS ON CORPORATION LAW

1. Doctrine of Legal Entity: A corporation has a personality separate and distinct from its
stockholders, directors, officers.

CONSEQUENCES OF DOCTRINE OF LEGAL ENTITY


a.Stockholders are not personally liable for the debts of the corporation and vice-versa.
b.Stockholders are not the owners of corporate properties and assets.
Other Legal Issues in Business
2. GR: Doctrine of Legal Entity
EXC: Doctrine of Legal Entity is disregarded, thus, the corporation and stockholders are treated
as ONE and the SAME in the following instances:

a. The corporate fiction/personality is used as a vehicle for the evasion of an existing


obligation.
b. The corporate fiction/personality is used to commit or protect a fraud, justify a wrong or
defend a crime.
c. In alter-ego cases where the corporation is a mere business conduit of a person.
❖ Mere interlocking directorate is not a sufficient ground to disregard the corporate
fiction/personality
Other Legal Issues in Business
ESTOPPEL LACHES
a bar which precludes a person from asserting anything - failure or neglect for an
contrary to that which has been established as the truth, unreasonable and unexplained length
by his own deed or representation, either express or of time to do that should have been
implied done earlier;

Example: - it is negligence or omission to assert


a. The seller is not the owner of a thing; a right within a reasonable time,
b. The seller sells and delivers it to another; warranting a presumption that the
c. The buyer later on acquires title to the thing. party entitled to assert it either has
abandoned it or declined to assert it.
Effect: Title passes by operation of law to the buyer.
Other Legal Issues in Business

Definition/Concept of Quasi-Contract: juridical relation resulting


from a lawful, voluntary and unilateral act, and which has for its
purpose the payment of indemnity to the end that no one shall be
unjustly enriched or benefited at the expense of another

2 TYPES:
1. Negotiorum Gestio/Unauthorized Management

2. Solutio Indebiti/Undue Payment


Other Legal Issues in Business
NEGOTIORUM GESTIO
REQUISITES EFFECT OF EXTINGUISHMENT
RATIFICATION
1. Person (manager/gestor) The ratification of the 1. owner repudiates or puts an
voluntary takes charge of; management by the end thereto
2. the agency or management of a owner of the business 2. gestor withdraws from
business or property belonging to produces the effects of management
another (owner); an express agency, even 3. death, insanity or insolvency
3. property or business is if the business may not of owner or gestor
neglected or abandoned; and have been successful.
4. gestor has not been authorized
by the owner.
Other Legal Issues in Business
SOLUTIO INDEBITI
REQUISITES
1.Something has been unduly delivered through mistake

2. Something was received by when there was no right to


demand it

When during a fire, flood, storm, or other calamity, property is saved from destruction by
stranger without the knowledge of the owner, the owner is bound to pay the stranger just
compensation
REFERENCES
A. Books
∙ Jurado (2019). Obligations and Contracts Reviewer. Rex Printing Company, Inc.
∙ De Leon and De Leon. (2018). Obligations and Contracts. Rex Publisher
B. Electronic References
∙ Jurisprudence (n.d.) Retrieved on 13 August 2021 from http://sc.judiciary.gov.ph/decisions/
∙ Jurisprudence and New Civil Code (n.d.) Retrieved on 13 August 2021 from http://supreme.chanrobles.com/
∙ Jurisprudence and New Civil Code (n.d.) Retrieved on 13 August 2021 from
https://lawphil.net/judjuris/judjuris.html
∙ Jurisprudence (n.d.) Retrieved on 13 August 2021 from
https://www.officialgazette.gov.ph/section/judicial/supreme-court/decisions/
C. Others
∙ Official Gazette of the Republic of the Philippines
∙ Philippine Reports
∙ Supreme Court Reports Annotated
∙ UP Law Bar Operations Commission. (2020). University of the Philippines 2020 Civil Law Reviewer

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