Case Digest (G.R. No. 12392) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
In Agapito A. Salido, Jr. v. Aramaywan Metals Development Corporation, petitioner Salido and respondents Cerlito G. San Juan, Corazon San Juan, and Cristina Marie San Juan entered into an Agreement to Incorporate in April 2005 to form two mining firms: Aramaywan Metals Development Corporation and Narra Mining Corporation. Under the Agreement, San Juan was to advance P2,500,000.00 as paid-up subscription for Aramaywan and assure the same amount for Narra, in exchange for 55% of Aramaywan’s capital stock. The P2,500,000.00 was deposited in San Juan’s name “as treasurer in trust” for Aramaywan, evidenced by a bank certificate. Aramaywan was duly registered with Articles of Incorporation showing 25,000 paid shares, of which San Juan’s 13,750 shares were divided among himself, his wife, and his daughter. Salido’s faction held the remaining shares. In November 2005, Salido’s faction alleged San Juan had only delivered P932,209.16 in cash and moved to reduce his shares from 55% to 15%. Case Digest (G.R. No. 12392) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Agreement to incorporate and subscription
- In April 2005, Agapito Salido, Jr., Cerlito San Juan, Ernesto Mangune and others (Salido faction) agreed to form two mining corporations—Aramaywan Metals Development Corporation (Aramaywan) and Narra Mining Corporation (Narra)—with San Juan to finance, Mangune to handle technical aspects, and Salido faction to secure site and permits.
- They executed an Agreement to Incorporate providing each corporation a capital stock of ₱10,000,000 divided into 100,000 shares; parties would subscribe/pay 25,000 shares (₱2,500,000), with San Juan to advance the full ₱2,500,000 for Aramaywan and assure payment for Narra.
- Incorporation of Aramaywan and share distribution
- San Juan deposited ₱2,500,000 in a Standard Chartered Bank account in his name as treasurer-in-trust for Aramaywan, which was incorporated with nine directors.
- The Articles of Incorporation showed 25,000 shares fully paid: San Juan’s 55% (13,750 shares) split among himself (5,000), his wife Corazon (5,000), and his daughter Cristina Marie (3,750)—the “San Juan faction”; the remaining five directors (35%) formed the “Salido faction.”
- Factional dispute and board resolutions
- At the first board meeting (Nov 25–26, 2005), Salido faction alleged San Juan only delivered ₱932,209.16 in cash, breached his obligation, and proposed reducing San Juan’s shares from 55% to 15%.
- At a special board meeting (Feb 5, 2006) called through Atty. Roland Pay, the Salido faction passed Resolutions 1–7: confirming share reduction, canceling San Juan family shares, changing corporate address, halting Narra’s incorporation, appointing new officers and secretary, and authorizing Salido to transact for Aramaywan.
- Competing corporate acts and RTC complaint
- San Juan faction convened its own meetings and filed conflicting General Information Sheets with the SEC.
- They then filed a suit with the RTC of Pasig seeking to invalidate the Salido faction’s acts.
Issues:
- Whether the Court of Appeals erred in its January 31, 2017 Amended Decision reversing the RTC and holding that Cerlito San Juan’s shares in Aramaywan were not validly reduced.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)