The SEC has jurisdiction over corporate names to implement the Corporation Code and prevent confusion. Refractories Corporation of the Philippines (RCP) was incorporated in 1977 and uses "Refractories" in its name, while Industrial Refractories Corporation of the Philippines (IRCP) was incorporated in 1985 using a similar name. RCP argued IRCP's name was confusingly similar, and the SEC and courts agreed, finding that RCP had acquired prior rights to "Refractories" and the names could cause confusion despite the added word "Industrial". Therefore, the petition of IRCP was denied.
The SEC has jurisdiction over corporate names to implement the Corporation Code and prevent confusion. Refractories Corporation of the Philippines (RCP) was incorporated in 1977 and uses "Refractories" in its name, while Industrial Refractories Corporation of the Philippines (IRCP) was incorporated in 1985 using a similar name. RCP argued IRCP's name was confusingly similar, and the SEC and courts agreed, finding that RCP had acquired prior rights to "Refractories" and the names could cause confusion despite the added word "Industrial". Therefore, the petition of IRCP was denied.
The SEC has jurisdiction over corporate names to implement the Corporation Code and prevent confusion. Refractories Corporation of the Philippines (RCP) was incorporated in 1977 and uses "Refractories" in its name, while Industrial Refractories Corporation of the Philippines (IRCP) was incorporated in 1985 using a similar name. RCP argued IRCP's name was confusingly similar, and the SEC and courts agreed, finding that RCP had acquired prior rights to "Refractories" and the names could cause confusion despite the added word "Industrial". Therefore, the petition of IRCP was denied.
corporations so it can implement the Corporation Code. Section 18 of the Corporation Code prohibits any proposed name which is identical or deceptively or confusingly similar to that of any existing corporation or any other name already protected by law. FACTS: 1. Refractories Corporation of the Philippines (RCP), herein respondent was organized in 1976 and was incorporated in 1977. RCP is engaged in manufacturing, selling, exporting and dealing in any and all refractory bricks, its by-products and derivatives. 2. Industrial Refractories Corporation of the Philippines (IRCP), herein petitioner was incorporated in 1979 under the name of Synclaire Manufacturing Corporation. It amended its Articles of Incorporation in 1985 and changed its name into IRCP. It is engaged in manufacturing all kinds of ceramic products except paint and zincs. 3. In 1988, RCP found out that IRCP was using such corporate name so it filed a petition before the SEC to compel the latter to change its corporate name because it is confusingly similar with formers corporate name. SEC ruled in favour of RCP and ordered IRCP to remove RCP in its corporate name. 4. SEC En Banc modified and ordered to remove the word Refractories only. CA affirmed SEC En Banc Decision. ISSUES: 1. WON SEC has jurisdiction over the case?
YES.
2. WON RCP is entitled to the exclusive use of the word
Refractories even though it is a generic word? YES. 3. WON the 2 corporate names are confusingly similar? YES. RATIO: First Issue: 1. SECs jurisdiction is not merely confined within sec. 5 PD 902-A, but by express mandate, has absolute jurisdiction, supervision and control over all corporations. Hence, it can enforce the Corporation Code. Section 18 (See Doctrine). 2. SEC has duty to prevent confusion to protect corporations and the public so it has the authority to determine whether the corporate names would likely to cause confusion, thus, has jurisdiction. Second Issue: 1. Refractories refers to structural materials used at high temperature to industrial furnaces. It is a generic term, but its usage is not widespread and is limited merely to the industry or trade in which it is used. Hence, continuous use by RCP for considerable period has made the term so closely identified with it. Third issue: 1. In Philips Export BV vs CA, the Court held that to fall within the prohibition, 2 requisites must be proven: (1) that the complainant corporation acquired a prior right over the use of such corporate name; (2) the proposed name is either: (a) identical, or (b) deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law; or (c) patently deceptive, confusing or contrary to existing law. 2. First requisite is determined by Priority of Adoption. RCP used it in 1976, while IRCP in 1985 only or 9 years after former. Hence, RCP acquired prior right to use of Refractories in its corporate name.
3. Second requisite is determined by if it would
mislead a person using ordinary care and discrimination. Both corporations have the words Refractories, Corporation, and Philippines and the only distinguishing word is Industrial. Industrial merely identifies a corporations general field of activities or operations. 4. Therefore, names are patently similar that even with reasonable care and observation, confusion might arise. It happened as found by SEC that there were instances when different steel companies were confused especially both have same packaging. 5. Revised Guidelines in the Approval of Corporate And Partnership Names requires:
(1) a corporate name shall not be identical,
misleading or confusingly similar to one already registered by another corporation with the Commission; and (2) if the proposed name is similar to the name of a registered firm, the proposed name must contain at least one distinctive word different from the name of the company already registered. DISPOSITIVE: Court (respondent) won.
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