Chapter 9 - Reviewer

IX. CORPORATE POWERS AND AUTHORITY  1. Corpora Cor porate te Powers Power s and Capacit Capa cit  Art. 46, Civil – Juridical persons may acquire and possess property of all kinds kinds,, as well well as incur incur oblig obligati ations ons and bring bring civil civil or crimi criminal nal action actions, s, in conformity with the laws and regulations of their organization. Sec. 36, Corpo – enumerat enumerates es all 10 express powers   conferred upon the corporation by law. law. hese are corporation!s capacity or right under its charter  and laws to do certain things. he 11 th  enumeration e"pressly recognizes those powers which are reasonably necessary to e"ecute the e"press powers and to accomplish or carry out the purposes for which the corporation was formed (implied powers) . Sec.  45, Corpo – #and e"cept such as are necessaryor incidental to the e"ercise of the powers so conferred. $incidental powers of a corporation% Constr!ction" To determine the powers of corporations, it is well-settled, as in other cases of legislative legislative grants, grants, that they are to #e constr!ed strict$% any ambigu ambiguity ity in the terms terms of the corpora corporate te chart charter er must must operate a&ainst t'e corporation and in (a)or o( t'e p!#$ic. I*portant R!$in&s"  The clear intendment of its Charter is for LBP to be clothed not only with the expre express ss power powers s grante granted d to it, but but also also with with those those impli implied, ed, incide incidenta ntall and necessary necessary for the exercise exercise of those those express express powers. +,-P ). COA 1/0 SCRA 123 Kas Kasama ama sa ka kapan pang gari ari!an !an ng "an "and# d#ank ank ang mag wr write ite$o% $o% ng loans, ergo, kasama din sa kapangari!an nila &ng mag#a#a o mag waive lang ng penalt c!arges.  corporation has only such powers as are expressly granted to it by law and by its articles of incorporation, those which may be incidental to such conferred powers, those reasonably necessary to accomplish its purposes and those which may be incident to its existence. ! Pi$ipinas ,oan Co*pan ). SEC 45 SCRA 1/43 Kaa nagreklamo si 'ilipinas awns!op kasi si ilipinas loan a  #ini #i nig gan an la lang ng ng ka kapa pang nga ari ri!a !an n na ma mag# g#ig iga a ng lo loan an !i !ind ndii ma mag$ g$ operate as a awns!op.

a. U$tra6 U$tra67i 7ires res Doctri Doctrine ne Sec. 45, Corpo & 'o corporation under this (ode shall possess or e"ercise any  corpor corporate ate powers powers e"cept e"cept those those confer conferred red by this this (ode (ode or by its its artic articles les of  incorporation#

"ltra-#ires acts are those not within the express, implied and incidental power of  a corporation. The general rule is that a corporation must act in the manner and with the formalities, if any, prescribed by its charter or by the general law.

I*portant R!$in&s" Contracts or acts of a corporation must be made either by the board of directors or by a corporate agent duly authori$ed by the board%absent such valid delegation&authori$ation, the rule is that the declaration of an individual directors relating to the a'airs of the corporation, but not in the course of, or connected with the performance of authori$ed duties of such director, are held not binding on the corporation. +8ani$a 8eta$ Container Corp. ). PN- 11 SCRA 2223. U*!tan& n& !*!tan& si 8.8. sa PN- 'an&&an& din na na na#aaran 9aa na6(orc$ose !n& *orta&a&e na. Se*pre s!#:ect an sa ri&'t to rep!rc'ase pero &!sto n& PN- na ;.58 !n& price tapos !n& isan& depart*ent n& PN- &!st 1.58 !*oo a&ad si 8.8 sa oas !n& *&a pan&a9o na pa$a 'i$aw sa#i n& Corporason di na*in& #ini&an si *o9on& n& &anan& a!t'orit. ?a aon.

#. Rati@cation o( U$tra67ires Act.

cts done in excess of corporate ocers3 scope of authority cannot bind the corporation. owever, when subse4uently a compromise agreement was on behalf of the corporation being represented by its President acting pursuant to a Board of 5irectors3 resolution, such constituted as a con)rmatory act signifying rati)cation of all prior acts of its ocers. ! Nationa$ Power Corp. ). A$ono6 ,e&asto 224 SCRA 42;3 U*oo !n& *&a oBcia$ n& NAPOCOR 9as'it wa$an& a!t'oriation sa9a na&6e>ceed n& a!t'orit n& na&da&da& si$a n& #$astin& wor9s. Dapat t$&a di #inded si NAPOCOR 9aso !n& co*pro*ise na pinaso9 ni$a constit!te rati@cation o( acts.

;. E>press Powers a. En!*erated Powers +Sec. 453 #. E>tension or S'ortenin& o( Corporate Ter* +Sec.43 -

6ust be approved by  ma)ority vote of the *oard of +irectors & Board of   Trustees. - ati-ed at a meeting by / of stockholder  representing the outstanding capital stoc7& 8&9 of members of non-stoc7 corporations. - :n case of extension of corporate term, appraisal right may be exercised by the dissenting stoc7holder

c. Increase and Decrease o( Capita$ Stoc9 +Sec. 43 -

6ust be approved by ma(ority vote of the Board of 5irectors& Board of  Trustees. - ;ati)ed at a meeting by 8&9 of stoc7holder representing the outstanding capital stoc7& 8&9 of members of non-stoc7 corporations. - Prior approval of 