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Petitioners, v. BAYOLO SALAMUDING, Respondent. G.R. No. 202639,
July 24, 2013, REYES, J.
III. TOPIC: Piercing the Veil of Corporate Fiction


On June 1, 2006, petitioner, through counsel Atty. Genesis M. Adarlo (Atty. Adarlo) of Joaquin
Adarlo and Caoile, sought assistance from the Criminal Investigation and Detection Group, Anti-
Fraud and Commercial Crimes Division (CIDG-AFCCD) of the Philippine National Police3 in
the surveillance, investigation, apprehension, and prosecution of certain persons and
establishments within Metro Manila reportedly committing acts violative of Batas Pambansa
Blg. 33 (BP 33),4 as amended by Presidential Decree No. 1865 (PD 1865),5 to wit: (1) refilling
of Liquefied Petroleum Gas (LPG) cylinders branded as Shellane, Petron Gasul, Caltex, Totalgaz
and Superkalan Gaz without any written authorization from the companies which own the said
brands in violation of Section 2(a),6 in relation to Sections 37 and 4;8 (2) underfilling of LPG
products or possession of underfilled LPG cylinders for the purpose of sale, distribution,
transportation, exchange or barter in violation of Section 2(c),9 in relation to Sections 310 and 4;
and, (3) refilling LPG cylinders without giving any receipt therefor, or giving out receipts
without indicating the brand name, tare weight, gross weight and/or price thereof, among others,
again in violation of Section 2(a) in relation to Sections 3(b)11 and 4.
A few days later or on June 8, 2006, Atty. Adarlo again wrote the CIDG-AFCCD informing the
latter of its confirmation that ACCS Ideal Gas Corporation (ACCS), which allegedly has been
refilling branded LPG cylinders in its refilling plant at 882 G. Araneta Avenue, Quezon City, has
no authority to refill per certifications from gas companies owning the branded LPG cylinders.12
Acting on the same, it mapped out a plan for the surveillance and investigation of ACCS.13
After a series of surveillance, the group observed that various vehicles and individuals carrying
branded LPG cylinders have been going in and out of ACCS refilling plant.
Having reasonable grounds to believe that ACCS was in violation of BP 33, P/Supt. Esguerra
filed with the Regional Trial Court (RTC) of Manila applications for search warrant against the
officers of ACCS, to wit: Antonio G. Del Rosario (Antonio) and, respondents Ma. Cristina L.
Del Rosario, Celso E. Escobido II, and Shiela M. Escobido. Pursuant to search warrants16
accordingly issued by the said court on August 1, 2006, a search and seizure operation was
A complaint was filed with the Department of Justice (DOJ) Complaints-Affidavits against
Antonio and respondents for illegal trading of petroleum products and for underfilling of LPG
cylinders under Section 2(a) and 2(c), respectively, of BP 33, as amended.
In his Counter-Affidavit,20 Antonio admitted that he was the General Manager of ACCS but
denied that the company was engaged in illegal trading and underfilling. He claimed that ACCS
was merely a dealer of LPG products to various retailers in Quezon City and that the alleged
refilling plant in G. Araneta Avenue, Quezon City was only being used by ACCS as storage of
LPG products intended for distribution. He also denied that ACCS has anything to do with the
persons allegedly in-charge of refilling activities in the said compound since they were not its
employees. Likewise, the properties seized during the search and seizure operation were not
owned by ACCS but by third parties who were bringing in LPG tanks for refilling with which, as
mentioned, ACCS has nothing to do. Antonio likewise asserted that the herein respondents were
merely incorporators of ACCS who have no active participation in the operation of the business
of the corporation.
Respondents, for their part, filed a Joint Counter-Affidavit21 corroborating the statements of
Antonio that they were merely incorporators/stockholders of ACCS who have no active
participation in the operation, management, and control of the business; that ACCS was only
engaged in the distribution of LPG products and not in the refilling of LPG cylinders; and, that
ACCS did not commit any violation of BP 33 as amended.
P/Supt. Esguerra filed a Reply-Affidavit22 wherein he pointed out that during the test-buy
operation, his team was issued ACCS Control Receipts. To him, this negated the claim of
Antonio and respondents that ACCS was not engaged in the refilling of cylinder tanks and that
the persons in-charge thereof were not ACCS' employees. P/Supt. Esguerra likewise stressed that
pursuant to Section 4 of BP 33, the President, General Manager, Managing Partner, or such other
officer charged with the management of the business affairs of the corporation, or the employee
responsible for the violation shall be criminally liable. Thus, Antonio, being the General
Manager, is criminally liable. Anent the respondents, P/Supt. Esguerra averred that the Articles
of Incorporation (AOI) of ACCS provides that there shall be five incorporators who shall also
serve as the directors. Considering that respondents were listed in the AOI as incorporators, they
are thus deemed as the directors of ACCS. And since the By-Laws of ACCS provides that all
business shall be conducted and all property of the corporation controlled and held by the Board
of Directors, and also pursuant to Section 2323 of the Corporation Code, respondents are
likewise criminally liable.
In their Joint Rejoinder-Affidavit,24 Antonio and respondents reiterated that ACCS was only a
dealer and distributor of petroleum products and not engaged in refilling activities. They also
stressed, among others, that respondents cannot be held liable under BP 33 as amended since the
AOI of ACCS did not state that they were the President, General Manager, Managing Partner, or
such other officer charged with the management of business affairs, What the AOI plainly
indicated was that they were the incorporating stockholders of the corporation and nothing more.


DOJ in a Joint Resolution26 dated June 25, 2008, Chief State Prosecutor Jovencito R Zuño
approved the finding of probable cause by Senior State Prosecutor Edwin S. Dayog, albeit only
against Antonio and only for the charge of illegal trading. P/Supt. Esguerra, now joined by
petitioner, filed a Petition for Review29 before the Secretary of Justice assailing the
aforementioned Joint Resolutions. The Secretary of Justice, however, upheld the said issuances
and dismissed the Petition in a Resolution30 dated September 4, 2009. The Motion for
Reconsideration31 thereto was likewise denied in a Resolution32 dated June 23, 2010. P/Supt.
Esguerra and petitioner elevated the matter to the CA through a certiorari petition. They
contended that the Secretary of Justice acted with grave abuse of discretion amounting to lack of
or in excess of jurisdiction in affirming the dropping of respondents from the complaints and the
ruling out of the offense of underfilling. The CA, however, sustained the Secretary of Justice.
1. Can respondents, as members of the Board of Directors of ACCS, be criminally prosecuted
for the latter's alleged violation/s of BP 33 as amended?

2. Are the offenses of illegal trading of petroleum products under Section 2(a) and underfilling
under Section 2(c), both of BP 33 as amended, distinct offenses?

1. No. Respondents cannot be prosecuted for ACCS' alleged violations of BP 33. They were
thus correctly dropped as respondents in the complaints.
The CA ratiocinated that by the election or designation of Antonio as General Manager of
ACCS, the daily business operations of the corporation were vested in his hands and had ceased
to be the responsibility of respondents as members of the Board of Directors. Respondents,
therefore, were not officers charged with the management of the business affairs who could be
held liable pursuant to paragraph 3, Section 4 of BP 33, as amended.
The Court finds no need to be labor this point as it has already made a definite pronouncement
on an identical issue in Ty v. NBI Supervising Agent De Jemil.
In the said case, therein petitioners were members of the Board of Directors of Omni Gas
Corporation (Omni), which was found by operatives of the National Bureau of Investigation
(NBI) as allegedly engaged in illegal trading of LPG and underfilling of LPG cylinders. While
the State Prosecutor found probable cause against therein petitioners, the Secretary of Justice,
however, reversed and set aside the said finding. On certiorari petition by the Office of the
Solicitor General, the CA granted the same and consequently reinstated the finding of probable
cause of the State Prosecutor. Naturally, petitioners brought the matter to this Court through a
Petition for Review on Certiorari where one of the core issues raised was whether therein
petitioners could be held liable for the corporation's alleged violations of BP 33. In resolving the
same, the Court ratiocinated.
Relying on the x x x above statutory proviso, petitioners argue that they cannot be held liable for
any perceived violations of BP 33. as amended, since they are mere directors of Omni who are
not in charge of the management of its business affairs. Reasoning that criminal liability is
personal, liability attaches to a person from his personal act or omission but not from the
criminal act or negligence of another. Since Sec. 4 of BP 33, as amended, clearly provides and
enumerates who are criminally liable, which do not include members of the board of directors of
a corporation, petitioners, mere members of the board of directors who are not in charge of
Omni's business affairs, maintain that they cannot be held liable for any perceived violations of
BP 3 On this point, we agree with petitioners except as to petitioner Arnel U. Ty who is
undisputably the President of Omni.
It may be noted that Sec. 4 above enumerates the persons who may be held liable for violations
of the law, viz[.]: (1) the president, (2) general manager, (3) managing partner, (4) such other
officer charged with the management of the business affairs of the corporation or juridical entity,
or (5) the employee responsible for such violation. A common thread of the first four enumerated
officers is the fact that they manage the business affairs of the corporation or juridical entity. In
short, they are operating officers of a business concern, while the last in the list is self-
It is undisputed that petitioners are members of the board of directors of Omni at the time
pertinent. There can be no quibble that the enumeration of persons who may be held liable for
corporate violators of BP 33, as amended, excludes the members of the board of directors. This
stands to reason for the board of directors of a corporation is generally a policy making body.
Even if the corporate powers of a corporation are reposed in the board of directors under the first
paragraph of Sec. 23 of the Corporation Code, it is of common knowledge and practice that the
board of directors is not directly engaged or charged with the running of the recurring business
affairs of the corporation. Depending on the powers granted to them by the Articles of
Incorporation, the members of the board generally do not concern themselves with the day-to-
day affairs of the corporation, except those corporate officers who are charged with running the
business of the corporation and are concomitantly members of the board, like the President.
Section 25 of the Corporation Code requires the president of a corporation to be also a member
of the board of directors.
Thus, the application of the legal maxim expressio unius est exclusio alterius, which means the
mention of one thing implies the exclusion of another thing not mentioned. If a statute
enumerates the thing upon which it is to operate, everything else must necessarily and by
implication be excluded from its operation and effect. The fourth officer in the enumerated list is
the catch-all 'such other officer charged with the management of the business affairs' of the
corporation or juridical entity which is a factual issue which must be alleged and supported by
As clearly enunciated in Ty, a member of the Board of Directors of a corporation, cannot, by
mere reason of such membership, be held liable for corporation's probable violation of BP 33. If
one is not the President, General Manager or Managing Partner, it is imperative that it first be
shown that he/she falls under the catch-all "such other officer charged with the management of
the business affairs," before he/she can be prosecuted. However, it must be stressed, that the
matter of being an officer charged with the management of the business affairs is a factual issue
which must be alleged and supported by evidence. Here, there is no dispute that neither of the
respondents was the President, General Manager, or Managing Partner of ACCS. Hence, it
becomes incumbent upon petitioner to show that respondents were officers charged with the
management of the business affairs. However, the Complaint-Affidavit39 attached to the records
merely states that respondents were members of the Board of Directors based on the AOI of
ACCS. There is no allegation whatsoever that they were in-charge of the management of the
corporation's business affairs.
At any rate, the Court has gone through the By-Laws of ACCS and found nothing therein which
would suggest that respondents were directly involved in the day-to-day operations of the
corporation. True, Section 140 of Article III thereof contains a general statement that the
corporate powers of ACCS shall be exercised, all business conducted, and all property of the
corporation controlled and held by the Board of Directors. Notably, however, the same provision
likewise significantly vests the Board with specific powers that were generally concerned with
policy making from which it can reasonably be deduced that the Board only concerns itself in the
business affairs by setting administrative and operational policies. It is actually the President
under Section 2,41 Article IV of the said by-laws who is vested with wide latitude in controlling
the business operations of the corporation. Among others, the President is specifically
empowered to supervise and manage the business affairs of the corporation, to implement the
administrative and operational policies of the corporation under his supervision and control, to
appoint, remove, suspend or discipline employees of the corporation, prescribe their duties, and
determine their salaries. With these functions, the President appears to be the officer charged
with the management of the business affairs of ACCS. But since there is no allegation or
showing that any of the respondents was the President of ACCS, none of them, therefore, can be
considered as an officer charged with the management of the business affairs even in so far as
the By-Laws of the subject corporation is concerned.
Clearly, therefore, it is only Antonio, who undisputedly was the General Manager – a position
among those expressly mentioned as criminally liable under paragraph 4, Section 3 of BP 33, as
amended – can be prosecuted for ACCS' perceived violations of the said law. Respondents who
were mere members of the Board of Directors and not shown to be charged with the management
of the business affairs were thus correctly dropped as respondents in the complaints.
2. Yes.
The offenses of illegal trading under Section 2(a) and underfilling under Section 2(c) both under
BP 33, as amended distinct offenses.
The State Prosecutor held that the offense of illegal trading by means of unauthorized refilling is
not distinct from the offense of underfilling since these two offenses involve the very same act of
refilling. He likewise held that the offender in the latter offense must be an entity duly authorized
to refill LPG cylinders. And in view of his finding that ACCS probably committed illegal trading
by refilling "without authority", the State Prosecutor impliedly held that the charge of
underfilling could not prosper in this case.
Petitioner, however, argues otherwise. It asserts that illegal trading of LPG products is
committed when an entity not authorized to refill a specified brand of LPG cylinder refills the
same, regardless of whether or not the LPG cylinder is underfilled. Underfilling, on the other
hand, is committed when an entity refills an LPG cylinder below the required quantity,
regardless of whether or not such entity is authorized to refill. Hence, the two offenses are
separate and distinct.
The Court agrees with petitioner.
Further, the Court finds without legal basis the conclusion of the State Prosecutor that the offense
of underfilling presupposes that the offender is a duly authorized refiller. Section 4 of BP 33, as
amended, clearly provides that any of the acts prohibited by the said law can be committed by
any person and not only by a duly authorized refiller. And while the same provision lays down
an additional penalty of cancellation of license in case the offender is an oil company, marketer,
distributor, refiller, dealer, sub-dealer, other retail outlets, or hauler, it cannot be deduced
therefrom that only a duly-licensed refiller can be held liable for underfilling. Verily, it can also
be committed by an authorized marketer, distributor, dealer, sub-dealer or hauler which so
happened to have a license to do business in such capacity but nevertheless commits underfilling.
Plainly, the law does not limit the commission of the offense of underfilling to offenders
who/which are duly authorized to refill. "It is [a] well recognized rule that where the law does
not distinguish, courts should not distinguish. Ubi lex non, distinguit nec nos distinguere
debemos. The rule, founded on logic, is a corollary of the principle that general words and
phrases in a statute should ordinarily be accorded their natural and general significance. The rule
requires that a general term or phrase should not be reduced into parts and one part distinguished
from the other so as to justify its exclusion from the operation of the law. In other words, there
should be no distinction in the application of a statute where none is indicated."42
All told, the Court so holds that aside from illegal trading through unauthorized refilling, the
State Prosecutor should have also taken cognizance of the complaint for underfilling.
Consequently, the CA erred when it affirmed in full the Resolutions of the Secretary of Justice
sustaining the ruling of the State Prosecutor.
WHEREFORE, the Petition for Review on Certiorari is PARTLY GRANTED. The assailed
April 27, 2012 Decision and July 6, 2012 Resolution of the Court of Appeals in CA-G.R. SP No.
115750 are AFFIRMED with MODIFICATION that the State Prosecutor is ORDERED to take
cognizance of the Complaint-Affidavit for Underfilling under Section 2(c), BP 33, as amended,
docketed as I.S. No. 2006-1173, but only insofar as Antonio G. Del Rosario is concerned.

RESPONDENTS. G.R. No. 182397, September 14, 2011, VILLARAMA,
JR., J..
III. TOPIC: Piercing the Veil of Corporate Fiction
Respondents Saidali Pasawilan, Wilfredo Verceles and Melchor Bulusan were all employed by
petitioner Alert Security and Investigation Agency, Inc. (Alert Security) as security guards
beginning March 31, 1996, January 14, 1997, and January 24, 1997, respectively. They were
paid 165.00 pesos a day as regular employees, and assigned at the Department of Science and
Technology (DOST) pursuant to a security service contract between the DOST and Alert
Respondents aver that because they were underpaid, they filed a complaint for money claims
against Alert Security and its president and general manager, petitioner Manuel D. Dasig, before
Labor Arbiter Ariel C. Santos. As a result of their complaint, they were relieved from their posts
in the DOST and were not given new assignments despite the lapse of six months. On January
26, 1999, they filed a joint complaint for illegal dismissal against petitioners.
Petitioners, on the other hand, deny that they dismissed the respondents. They claimed that from
the DOST, respondents were merely detailed at the Metro Rail Transit, Inc. at the Light Rail
Transit Authority (LRTA) Compound in Aurora Blvd. because the wages therein were already
adjusted to the latest minimum wage. Petitioners presented "Duty Detail Orders"[5] that Alert
Security issued to show that respondents were in fact assigned to LRTA. Respondents, however,
failed to report at the LRTA and instead kept loitering at the DOST and tried to convince other
security guards to file complaints against Alert Security. Thus, on August 3, 1998, Alert Security
filed a "termination report"[6] with the Department of Labor and Employment relative to the
termination of the respondents.
Upon motion of the respondents, the joint complaint for illegal dismissal was ordered
consolidated with respondents' earlier complaint for money claims. The records of the illegal
dismissal case were sent to Labor Arbiter Ariel C. Santos, but later returned to the Office of the
Labor Arbiter hearing the illegal dismissal complaint because a Decision[7] has already been
rendered in the complaint for money claims on July 14, 1999. In that decision, the complaint for
money claims was dismissed for lack of merit but petitioners were ordered to pay respondents
their latest salary differentials.


July 28, 2000: LA Del Rosario rendred a Decision finding that the respondents wre illegally
dismissed and ordering that “each complainant should be paid in solidum by [Alert and Dasig].”.
Petitioners appealed the decision to the NLRC. January 31, 2007: The NLRC dismissed the
complaint for illegal dismissal. Respondents went up to the CA. February 1, 2008, the CA
rendered a Decision reversing and setting aside the NLRC decision and reinstating the July 28,
2000 Decision of LA Del Rosario. Petitioners filed an MR but it was denied.
Petitioners are now before this Court to seek relief by way of a petition for review on certiorari
under Rule 45 of the 1997 Rules of Civil Procedure, as amended.
1. Were the respondents illegally dismissed? Yes
2. Should Dasig be liable in solidum with Alert Security? No
1. In the case at bar, respondents were relieved from their posts because they filed with the
Labor Arbiter a complaint against their employer for money claims due to underpayment
of wages. This reason is unacceptable and illegal. Nowhere in the law providing for the
just and authorized causes of termination of employment is there any direct or indirect
reference to filing a legitimate complaint for money claims against the employer as a
valid ground for termination.
The Labor Code, as amended, enumerates several just and authorized causes for a valid
termination of employment. An employee asserting his right and asking for minimum wage is
not among those causes.
Dismissing an employee on this ground amounts to retaliation by management for an employee’s
legitimate grievance without due process. Such stroke of retribution has no place in Philippine
Labor Laws.

2. It is a basic rule that a corporation has a separate and distinct personality apart from its
directors, officers or owners. In exceptional cases, courts find it proper to breach this
corporate personality in order to make directors, officers, or owners solidarily liable for
the companies’ acts.
Sec. 31. Liability of directors, trustees or officers. - Directors or trustees who willfully and
knowingly vote for or assent to patently unlawful acts of the corporation or who are guilty of
gross negligence or bad faith in directing the affairs of the corporation or acquire any personal or
pecuniary interest in conflict with their duty as such directors, or trustees shall be liable jointly
and severally for all damages resulting therefrom suffered by the corporation, its stockholders or
members and other persons.
Jurisprudence has also been consistent in defining the instances when the separate and distinct
personality of a corporation may be disregarded in order to hold the directors officers, or owners
of the corporation liable for corporate debts.
Carag v NLRC: “We have already ruled in McLeod v NLRC and Sps. Santos v NLRC that Art.
212 (e) of the Labor Code, by itself, does not make a corporate officer personally liable for the
debts of the corporation. The governing law on personal liability of directors for debts of the
corporation is still Sec. 31 of the Corporation Code.
In the present case, there is no evidence to indicate that Dasig, as president and general manager
of Alert Security, is using the veil of corporate fiction to defeat public convenience, justify
wrong, protect fraud, or defend crime.
Further, there is no showing that Alert Security has folded up its business or is reneging in its
obligations. In the final analysis, it is Alert Security that respondents are after and it is also Alert
Security who should take responsibility for their illegal dismissal.


WHEREFORE, the petition for review on certiorari is DENIED. The Decision of the Court of
Appeals in CA-G.R. SP No. 99861 and the Decision dated July 28, 2000 of the Labor Arbiter are
MODIFIED. Petitioner Manuel D. Dasig is held not solidarily liable with petitioner Alert
Security and Investigation, Inc. for the payment of the monetary awards in favor of respondents.
Said Decision of the Court of Appeals in all other aspects is AFFIRMED.
With costs against the petitioners.
RESOURCE DEVELOPMENT CORP., Respondents G.R. No. 149660
January 20, 2009, PUNO, C.J.

III. TOPIC: Piercing the Veil of Corporate Fiction

Oabel was initially hired by petitioner as an extra beverage attendant on April 24, 1995. This
lasted until February 7, 1997. Respondent worked in Century Park Hotel, an establishment
owned by the petitioner. On September 16, 1996, petitioner contracted with Manila Resource
Development Corporation. Subsequently, private respondent Oabel was transferred to
MANRED, with the latter deporting itself as her employer. MANRED has intervened at all
stages of these proceedings and has consistently claimed to be the employer of private
respondent Oabel. For the duration of her employment, private respondent Oabel performed the
following functions: Secretary, Public Relations Department: February 10, 1997 March 6, 1997
Gift Shop Attendant: April 7, 1997 April 21, 1997
Waitress: April 22, 1997 May 20, 1997
Shop Attendant: May 21, 1997 July 30, 1998


Labor Arbiter Madjayran H. Ajan rendered a decision on July 13, 1999, dismissing the complaint
against the petitioner.
Private respondent appealed before the National Labor Relations Commission (NLRC). The
NLRC reversed the ruling of the Labor Arbiter and held that: (1) MANRED is a labor-only
contractor, and (2) private respondent was illegally dismissed.
Of the first holding, the NLRC observed that under the very terms of the service contract,
MANRED shall provide the petitioner not specific jobs or services but personnel and that
MANRED had insufficient capitalization and was not sufficiently equipped to provide specific
jobs.[8] The NLRC likewise observed that the activities performed by the private respondent
were directly related to and usually necessary or desirable in the business of the petitioner.[9]
With respect to the termination of private respondents employment, the NLRC held that it was
not effected for a valid or just cause and was therefore illegal.
Petitioner subsequently appealed before the Court of Appeals. In a resolution, the appellate court
dismissed the petition on account of the failure of the petitioner to append the board resolution
authorizing the counsel for petitioner to file the petition before the Court of Appeals . Petitioner
duly filed its motion for reconsideration which was denied by the Court of Appeals in a
resolution dated August 30, 2001.
In the present petition for review, the petitioner invokes substantial justice as justification for a
reversal of the resolution of the Court of Appeals.[13] Petitioner likewise contends that the filing
of a motion for reconsideration with the certificate of non-forum shopping attached constitutes
substantial compliance with the requirement authorizing the counsel for petitioner to file the
petition before the Court of Appeals.

1. Whether or not the CA is correct in denying the appeal on the ground of non-compliance
with the rule on certification against forum shopping taking into account that the
aforesaid certification was subscribed and verified by the Personnel Director of petitioner
corporation without attaching thereto his authority to do so for and in behalf of petitioner
corporation per board resolution or special power of attorney executed by the latter?

2. Maranaw Hotels entered into a service agreement with MANRED?

1. Yes. Well-settled is the rule that the certificate of non-forum shopping is a mandatory
requirement. Substantial compliance applies only with respect to the contents of the
certificate but not as to its presence in the pleading wherein it is required.
Petitioners contention that the filing of a motion for reconsideration with an appended certificate
of non forum-shopping suffices to cure the defect in the pleading is absolutely specious. It
negates the very purpose for which the certification against forum shopping is required: to
inform the Court of the pendency of any other case which may present similar issues and involve
similar parties as the one before it. The requirement applies to both natural and juridical persons.

Any doubt on the matter has been resolved by the Courts ruling in BPI Leasing Corp. v. Court of
Appeals[17] where this Court emphasized that the lawyer acting for the corporation must be
specifically authorized to sign pleadings for the corporation.[18] Specific authorization, the
Court held, could only come in the form of a board resolution issued by the Board of Directors
that specifically authorizes the counsel to institute the petition and execute the certification, to
make his actions binding on his principal, i.e., the corporation.
This Court has not wavered in stressing the need for strict adherence to procedural requirements.
The rules of procedure exist to ensure the orderly administration of justice. They are not to be
trifled with lightly.
For this reason alone, the petition must already be dismissed. However, even if this grave
procedural infirmity is set aside, the petition must still fail.
2. No.
Petitioner posits that it has entered into a service agreement with intervenor MANRED. The
latter, in turn, maintains that private respondent Oabel is its employee and subsequently holds
itself out as the employer and offers the reinstatement of private respondent.
Notably, private respondents purported employment with MANRED commenced only in 1996,
way after she was hired by the petitioner as extra beverage attendant on April 24, 1995. There is
thus much credence in the private respondents claim that the service agreement executed
between the petitioner and MANRED is a mere ploy to circumvent the law on employment, in
particular that which pertains on regularization.
In this regard, it has not escaped the notice of the Court that the operations of the hotel itself do
not cease with the end of each event or function and that there is an ever present need for
individuals to perform certain tasks necessary in the petitioners business. Thus, although the
tasks themselves may vary, the need for sufficient manpower to carry them out does not. In any
event, as borne out by the findings of the NLRC, the petitioner determines the nature of the tasks
to be performed by the private respondent, in the process exercising control.
This being so, the Court finds no difficulty in sustaining the finding of the NLRC that MANRED
is a labor-only contractor.[20] Concordantly, the real employer of private respondent Oabel is the
It appears further that private respondent has already rendered more than one year of service to
the petitioner, for the period 1995-1998, for which she must already be considered a regular


IN VIEW WHEREOF, the present petition is DENIED. The resolution of the Court of Appeals
dated June 15, 2001 is affirmed.
Costs against petitioner.
PHILIPPINES, Respondent G.R. No. 211108, June 07, 2017, TIJAM, J.
III. TOPIC: Piercing the Veil of Corporate Fiction


On November 17, 1993, Barangay Mulawin Tricycle Operators and Drivers Association, Inc.
(BMTODA) became a corporation duly registered with the Securities and Exchange Commission
Sometime in August 2003, Oscar Ongjoco (Ongjoco), a member of BMTODA, learned that
BMTODA's funds were missing. In a letter, Ongjoco requested copies of the Association's
documents pursuant to his right to examine records under Section 74 of the Corporation Code of
the Philippines (Corporation Code). However, Singson, the Secretary of BMTODA, denied his
Ongjoco also learned that the incumbent officers were holding office for three years already, in
violation of the one-year period provided for in BMTODA's by-laws. He then requested from
Roque, the President of BMTODA, a copy of the list of its members with the corresponding
franchise numbers of their respective tricycle fees and the franchise fees paid by each member,
but Roque denied Ongjoco's request.
Ongjoco filed an Affidavit-Complaint against Roque and Singson for violation of Section 74 in
relation to Section 144 of the Corporation Code because of their refusal to furnish him copies of
records pertaining to BMTODA.
The Office of the City Prosecutor of San Jose Del Monte, Bulacan found probable cause to indict
Roque and Singson.
After the prosecution rested its case, Roque and Singson filed a Motion for Leave of Court to
File Demurrer to Evidence with Motion to Dismiss by way of Demurrer to Evidence. The
prosecution failed to file any comment thereon.
In an Order7 dated November 12, 2008, the RTC granted the motion and gave due course to
Roque and Singson's demurrer to evidence. The RTC ruled that said association failed to prove
its existence as a corporation. Hence, a violation under the Corporation Code cannot be made
applicable against its officers.
On appeal, the CA reversed and set aside the Order dated November 12, 2008 of the RTC. The
CA ruled that BMTODA is a duly registered corporation. The CA stated that a Petition to Lift
Order of Revocation and the SEC Order Lifting the Revocation were presented in evidence; and
that logic dictates that such documentary evidence presupposes a duly registered and existing
Petitioner contends that there is want of evidence to prove that BMTODA is a corporation duly
established and organized under the Corporation Code; thus, he cannot be prosecuted under the
penal provisions of the said code.


Roque assails the Decision1 dated August 31, 2012 and the Resolution2 dated January 22, 2014
of the Court of Appeals3 (CA), which set aside and annulled the Order4 dated November 12,
2008 of the Regional Trial Court (RTC)5, Third Judicial Region, Branch 11, Malolos City,
Bulacan in Criminal Case No. 1011-M- 2005. Said Order granted the motion for leave of court to
file demurrer to evidence filed by Rosalyn Singson (Singson), herein petitioner's co-accused and
the case is remanded to the court a quo for the presentation of defense evidence.
Whether or not Roque’s contention is tenable ?
Section 7410 of the Corporation Code provides for the liability for damages of any officer or
agent of the corporation for refusing to allow any director, trustee, stockholder or member of the
corporation to examine and copy excerpts from its records or minutes. Section 144 of the same
Code further provides for other applicable penalties in case of violation of any provision of the
Corporation Code.
Hence, to prove any violation under the aforementioned provisions, it is necessary that: (1) a
director, trustee, stockholder or member has made a prior demand in writing for a copy of
excerpts from the corporations records or minutes; (2) any officer or agent of the concerned
corporation shall refuse to allow the said director, trustee, stockholder or member of the
corporation to examine and copy said excerpts; (3) if such refusal is made pursuant to a
resolution or order of the board of directors or trustees, the liability under this section for such
action shall be imposed upon the directors or trustees who voted for such refusal; and (4) where
the officer or agent of the corporation sets up the defense that the person demanding to examine
and copy excerpts from the corporation's records and minutes has improperly used any
information secured through any prior examination of the records or minutes of such corporation
or of any other corporation, or was not acting in good faith or for a legitimate purpose in making
his demand, the contrary must be shown or proved.11
Clearly, Ongjoco, as a member of BMTODA, had a right to examine documents and records
pertaining to said association. To recall, Ongjoco made a prior demand in writing for copy of
pertinent records of BMTODA from Roque and Singson. Ongjoco sent his letters dated
December 13, 200312 and August 29, 200413 to Roque and Singson, respectively. However,
both of them refused to furnish Ongjoco copies of such pertinent records.
Roque argues that when the letters were received by him and Singson, BMTODA's registration
was already revoked. Hence, BMTODA ceased to exist as a corporation.
We are not persuaded.
While it appears that the registration of BMTODA as a corporation with the SEC was revoked on
September 30, 2003, the letter-request of Ongjoco to Singson, which was dated while
BMTODA's registration was revoked, was actually received by Singson after the revocation was
lifted. In a Letter dated October 11, 2004, the General Counsel of the SEC made it clear that the
SEC lifted the revocation of BMTODA's registration on August 30, 2004. As the CA correctly
observed, the letter-request was received by Singson on September 23, 2004 when BMTODA
had regained its active status.
In any case, the revocation of a corporation's Certificate of Registration does not automatically
warrant the extinction of the corporation itself such that its rights and liabilities are likewise
altogether extinguished. In the case of Clemente v. Court of Appeals15, the Court explained that
the termination of the life of a juridical entity does not, by itself, cause the extinction or
diminution of the rights and liabilities of such entity nor those of its owners and creditors.
Thus, the revocation of BMTODA's registration does not automatically strip off Ongjoco of his
right to examine pertinent documents and records relating to such association.
Also, since Roque admitted the revocation of BMTODA's registration16, he cannot come
forward and disclaim BMTODA's registration with the SEC as a corporation. It is logical to
presume that a registration precedes the revocation thereof; as any registration cannot be revoked
without its valid existence.
Moreover, Roque also tries to exculpate himself from liability by claiming Singson's denial of
the request of Ongjoco as Singson's personal act.
We do not agree.
A reading of this present Petition reveals that Roque admitted17 his denial of Ongjoco's request,
i.e., to furnish him a copy of BMTODA's list of its members with the corresponding franchise
body numbers of their respective tricycles and franchise fees paid by each member. Also, what
was requested from Singson pertains to an entirely different document. Thus, Singson's denial is
immaterial, and does not detract from Roque's denial of Ongjoco's request to access the above-
mentioned document. For his individual and separate act, Roque should be held accountable.
Hence, Roque's denial is unquestionably considered as a violation under the Corporation Code.
WHEREFORE, the instant petition is DENIED. The Decision dated August 31, 2012 and
Resolution dated January 22, 2014 of the Court of Appeals are AFFIRMED in toto.