G.R. No. 184068 - Guy vs. Guy

Goodland Company, Inc. (GCI) is a family-owned corporation organized under Philippine laws.
Petitioner Simny G. Guy is a stockholder of record and a member of the board of directors of GCI.
Respondents Gilbert G. Guy, Alvin Agustin T. Ignacio, and John and/or Jane Does are also stockholders of GCI and alleged to have been elected as new directors during the special stockholders’ meeting held on September 7, 2004.

On August 31, 2004, a notice calling for a special stockholders’ meeting scheduled on September 7, 2004, at 10:00 a.m. at the Manila Diamond Hotel was prepared and signed by Gilbert G. Guy as Executive Vice-President.
The notice mentioned the election of the Board of Directors for 2004-2005 among other corporate matters, and invited proxies if stockholders could not attend personally.
Paulino Delfin Pe and Benjamin Lim, stockholders of record, informed petitioner Simny G. Guy of the notice on September 10, 2004, i.e., after the meeting.
The registered mail notice was sent on September 2, 2004, but petitioner received it only on September 22, 2004, fifteen days after the meeting.

On September 30, 2004, petitioner, acting for himself, GCI, and Grace Guy Cheu (Cheu), filed a complaint before the RTC of Manila seeking to nullify the stockholders’ meeting and election of directors, as well as to nullify subsequent acts and resolutions, and for damages.
Petitioner alleged that (a) no prior notice was given to him and Cheu, (b) the meeting was not called by the proper person, and (c) the notices were not issued by someone with legal authority.
Respondent Gilbert Guy contended that the meeting was legally called, notices were properly issued and sent according to the by-laws, and that Cheu was not a stockholder of record entitled to notice.

The RTC issued a Temporary Restraining Order (TRO) on October 18, 2004, enjoining respondents from acting as directors or officers of GCI.
The respondents disclosed in August 2005 that an annual stockholders’ meeting was held on April 11, 2005, and moved to dismiss the complaint as moot and academic.
The 2005 meeting notice was sent in compliance with GCI’s by-laws and the Corporation Code, with proof of receipt by other stockholders but unclaimed by petitioner.
The RTC denied the dismissal petition on October 26, 2005, because the issues pertained to acts arising from the September 7, 2004 special meeting.

The RTC, in a decision dated June 25, 2007, dismissed the complaint, holding that:

Notice of the special meeting was sent to petitioner by registered mail five days before the meeting, fulfilling the by-laws requirement.
Petitioner and Cheu admitted being informed about the meeting through other stockholders.
Petitioner owned approximately 9.97% of the outstanding shares, while respondent Gilbert Guy owned nearly 80%.
The special meeting could be validly called by the President or upon the written request of stockholders owning one-third of outstanding shares; respondent Gilbert, as Vice President, was qualified to act as President due to the President’s incapacity.
Plaintiff Cheu was not a stockholder of record, hence not entitled to notice.
Because the meeting was validly called with proper notice, petitioners’ claims for damages failed.

The CA affirmed the RTC decision in toto on April 30, 2008, holding that proper notice was given and the meeting was valid.
Petitioner elevated the case to the Supreme Court via a Petition for Review on Certiorari under Rule 45.
The Supreme Court resolved that the petition lacks merit and affirmed the CA decision.

Whether the notice of the special stockholders’ meeting held on September 7, 2004, was valid and legally sufficient despite the petitioner not receiving the notice until after the meeting date.

Whether the special stockholders’ meeting was called by the proper person authorized under the Corporation Code and GCI’s by-laws.

Whether Grace Guy Cheu was entitled to notice as a stockholder of record of GCI.

Whether the holding of the 2005 annual stockholders’ meeting rendered the case moot and academic.