ALBERT VS.

UNIVERSITY PUBLISHING

FACTS:
Mariano Albert entered into a contract with University Publishing Co., Inc. through Jose M.
Aruego, its President, whereby University would pay plaintiff for the exclusive right to publish
his revised Commentaries on the Revised Penal Code. The contract stipulated that failure to pay
one installment would render the rest of the payments due. When University failed to pay the
second installment, Albert sued for collection and won.
However, upon execution, it was found that the records of this Commission do not show the
registration of UNIVERSITY PUBLISHING CO., INC., either as a corporation or
partnership. Albert petitioned for a writ of execution against Jose M. Aruego as the real
defendant. University opposed, on the ground that Aruego was not a party to the case.
ISSUE: WON University Publishing Co., Inc. is an existing corporation with an independent
juridical personality despite not being registered with the SEC.

HELD: No. On account of the non-registration it cannot be considered a corporation, not even a
corporation de facto (Hall vs. Piccio, 86 Phil. 603). It has therefore no personality separate from
Jose M. Aruego; it cannot be sued independently.
In the case at bar, Aruego represented a non-existent entity and induced not only Albert but the
court to believe in such representation. He signed the contract as President of University
Publishing Co., Inc., stating that this was a corporation duly organized and existing under the
laws of the Philippines.
A person acting or purporting to act on behalf of a corporation which has no valid existence
assumes such privileges and obligations and becomes personally liable for contracts entered into
or for other acts performed as such agent.
Aruego, acting as representative of such non-existent principal, was the real party to the contract
sued upon, and thus assumed such privileges and obligations and became personally liable for
the contract entered into or for other acts performed as such agent.
The Supreme Court likewise held that the doctrine of corporation by estoppel cannot be set up
against Albert since it was Aruego who had induced him to act upon his (Aruegos) willful
representation that University had been duly organized and was existing under the law.