Case Digest (G.R. No. 93695) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
In Ramon C. Lee and Antonio D.M. Lacdao v. The Hon. Court of Appeals, Sacoba Manufacturing Corp., Pablo Gonzales, Jr. and Thomas Gonzales (G.R. No. 93695, February 4, 1992), petitioners Lee and Lacdao challenged the Court of Appeals’ reversal of the Regional Trial Court of Makati, Branch 58 orders that had declared improper the service of summons on Alfa Integrated Textile Mills (ALFA). International Corporate Bank, Inc. sued the private respondents, who in turn impleaded ALFA and the petitioners in a third-party complaint on March 17, 1986. The petitioners moved to dismiss, which was denied on June 27, 1988. Meanwhile, ALFA’s management had been transferred to the Development Bank of the Philippines (DBP) under a voting trust agreement executed on March 11, 1981. Despite notice that Lee and Lacdao were no longer ALFA officers, summons was served on them on August 21, 1987. The trial court initially invalidated service but later reversed itself, only to reverse again on April 25 Case Digest (G.R. No. 93695) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Parties and Subject Matter
- Petitioners: Ramon C. Lee and Antonio Dm. Lacdao, formerly president and executive vice-president of ALFA Integrated Textile Mills (ALFA).
- Private Respondents: Sacoba Manufacturing Corp., Pablo Gonzales Jr., Thomas Gonzales; third-party plaintiffs in an action for sums due.
- Central Dispute: Whether service of summons on ALFA through petitioners was proper in view of a voting trust agreement executed between ALFA’s stockholders and the Development Bank of the Philippines (DBP).
- Procedural History
- Mar. 17, 1986: Private respondents file third-party complaint vs. ALFA and petitioners.
- Jun. 27, 1988: Trial court denies petitioners’ motion to dismiss; Jul. 18, 1988: petitioners answer.
- Jul.–Aug. 1988: Trial court orders issuance of alias summons on ALFA via DBP; DBP refuses; court declares service on petitioners proper (Aug. 17, 1988).
- Sep. 12, 1988–Jan. 2, 1989: Petitioners move for reconsideration, arguing they ceased to be ALFA officers; Jan. 2 order denies motion.
- Jan. 19–Apr. 25, 1989: Petitioners file second motion attaching the 1981 voting trust agreement; Apr. 25 order declares service on petitioners improper.
- Aug.–Oct. 1989: Private respondents’ motions for reconsideration denied; late certiorari to Court of Appeals (CA) granted; trial court finalizes Apr. 25 order.
- Mar.–May 1990: CA decision (Mar. 19, 1990) sets aside trial court’s Apr. and Aug. 1989 orders, deems service proper; petitioners’ motion for reconsideration denied.
- Jan. 3, 1991: CA sets aside its erroneous entry of judgment of Jul. 16, 1990.
- Voting Trust Agreement
- Date and Parties: Executed Mar. 11, 1981 between all ALFA stockholders (including petitioners) and DBP as trustee.
- Principal Terms:
- Assignment of legal title of shares to DBP.
- Issuance of voting trust certificates to transferors.
- Trustee’s power to vote all shares and to transfer one share for director qualification.
- Duration: Five years, renewable as long as ALFA’s obligations to DBP remain outstanding.
- Cancellation of original stock certificates; reissuance in trustee’s name.
Issues:
- What is the legal nature and effect of the voting trust agreement under the Corporation Code?
- Who holds legal title to the ALFA shares under the trust agreement?
- For how long is a voting trust agreement valid and enforceable?
- Does a stockholder-trustor who assigns his shares to a trustee cease to be a director under Section 23 of the Corporation Code?
- Was service of summons on ALFA proper when effected through petitioners after the voting trust was created?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)