Lichauco v. Atlantic Gulf and Pacific Co

Lichauco v. Atlantic Gulf & Pacific Co

Inasmuch as the Dead Man’s Statute disqualifies only parties or assignors of parties, officers and/or stockholders of a corporation are not disqualified from testifying, for or against the corporation which is a party to an action upon a claim or demand against the estate of a deceased de ceased person, as to any matter of fact fa ct occurring before the death of such deceased person.

Doctrine:

Facts:

Richard Fitzsimmons, the president of Atlantic Gulf, a foreign corporation registered and licensed to do business in the philippines, held 1,000 shares of stock of which 545 had not been fully paid for but were covered by promissory notes in favor of Atlantic Gulf. In 1941, P64,500.00 was credited in his favor on account of the purchase price of the said stocks out of bonuses and dividends to which he was entitled entit led from the company. Under an agreement with Atlantic, should he die leaving the t he shares unpaid, Atlantic, at his option, may either e ither acquire said shares by returning to his estate the t he amount applied thereon, or issue in favor of his estate the corresponding shares equivalent to the amount paid thereon. Fitzsimmons died and a proceeding for the settlement of his estate was instituted. Atlantic then filed a claim cl aim against the estate and offered to reacquire the shares sold to Fitzsimmons upon return to the estate of the P64,500 paid thereon.  The admini administrato strator, r, Marcial Marcial Lichauco, Lichauco, however however,, denied denied the the alleged alleged indebtedne indebtedness. ss. During trial, Atlantic presented the testimonies of the chief accountant and assistant accountant, and of the president and vice-president-treasurer of the corporation.  The trial trial court court however however refused refused to admit admit said said testimon testimonies ies on the ground ground of  incompetency under the Dead Man’s State, as the witnesses were not only stockholders and members of the Board of Directors, but officers as well. Issue:

Are the officers of a corporation which is a party to an action against an administrator disqualified from testifying under the Dead Man’s Statute? Held:

No.  To hold hold that that the the statute statute disqua disqualifies lifies all person persons s from from testifyin testifying g who who are officers officers or stockholders of a corporation would be equivalent to materially amending the statute by judicial legislation.  The Dead Dead Man’s Statute Statute disquali disqualifies fies only parties parties or assignors assignors of parties; parties; officers officers and/or stockholders of a corporations, therefore, are not disqualified from testifying,

for or agianst the corporation which is a party to an action upon a claim or demand against the estate of a deceased person, as to any matter of fact occurring before the death of such person.