Case Digest (G.R. No. 191644)
Facts:
In Paul Lee Tan et al. v. Paul Sycip and Merritto Lim, Grace Christian High School (GCHS), a nonstock, non-profit educational corporation, counted fifteen regular members who served also as trustees. On April 6, 1998, its annual members’ meeting was convened in Manila and chaired by Atty. Sabino Padilla Jr., though Atty. Antonio C. Pacis objected to the lack of quorum. Of the original fifteen, four had died, leaving eleven living members; seven of these attended by proxy. During that meeting, petitioners elected Ernesto Tanchi, Edwin Ngo, Virginia Khoo, and Judith Tan to fill the vacancies. The Securities and Exchange Commission (SEC) Hearing Officer declared the proceedings void for lack of quorum, holding that the Articles of Incorporation fixed the membership base for quorum purposes regardless of deaths. The SEC En banc affirmed. Petitioners appealed to the Court of Appeals (CA), which dismissed their petition for review on the ground that only one petitioner signed the VeriCase Digest (G.R. No. 191644)
Facts:
- Parties and Corporate Structure
- Grace Christian High School (GCHS) is a nonstock, non-profit educational corporation.
- It has fifteen (15) regular members who also constitute its Board of Trustees under Article II(1) of the Amended By-Laws.
- April 6, 1998 Annual Members’ Meeting
- Four members had died prior to the meeting, leaving eleven (11) living member-trustees.
- Seven of the eleven attended by proxy; the meeting was convened and chaired by Atty. Sabino Padilla Jr.
- Atty. Antonio C. Pacis objected, arguing there was no quorum.
- The attending members voted to fill the four vacancies by electing Ernesto Tanchi, Edwin Ngo, Virginia Khoo, and Judith Tan.
- SEC Proceedings
- Petitioners appealed to the SEC, contending that deceased members lose all rights, including voting, upon death.
- Hearing Officer Militar ruled the meeting void for lack of quorum, interpreting Section 52 of the Corporation Code to count all members specified in the articles.
- SEC en banc affirmed, holding that “members” in Section 52 refer to those named in the articles of incorporation, not only living members.
- Court of Appeals Proceedings
- Petitioners filed a Rule 45 Petition for Review but Verification and Certification of Non-Forum Shopping were signed solely by Atty. Padilla without a Special Power of Attorney (SPA).
- The CA dismissed the petition on that procedural ground; its denial of reconsideration followed.
- Petition to the Supreme Court
- Petitioners sought reversal of the CA resolutions, raising:
- Whether the CA erred in dismissing on the verification/certification defect.
- Whether dead members should be counted in determining quorum of a nonstock corporation.
Issues:
- Procedural Issue
- Did the Court of Appeals err in dismissing the petition for review due to a defective Verification and Certification of Non-Forum Shopping signed without proof of authority?
- Substantive Issue
- In non-stock corporations, must deceased members still be counted in determining the quorum for an annual members’ meeting?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)