Case Digest (G.R. No. 151969) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
In Valle Verde Country Club, Inc., Ernesto Villaluna, Ray Gamboa, Amado M. Santiago, Jr., Fortunato Dee, Augusto Sunico, Victor Salta, Francisco Ortigas III, Eric Roxas in their capacities as Members of the Board of Directors of Valle Verde Country Club, Inc., and Jose Ramirez (petitioners) versus Victor Africa (respondent), the dispute arose from vacancies in the corporate board. On February 27, 1996, at the annual stockholders’ meeting of Valle Verde Country Club, Inc. (VVCC), nine directors were duly elected for one-year terms under Section 23 of the Corporation Code. From 1997 to 2001, stockholders’ meetings failed for lack of quorum, and the directors continued in a hold-over capacity. On September 1, 1998, Jaime C. Dinglasan resigned; on October 6, 1998, the hold-over directors, constituting a quorum, elected Eric Roxas as his replacement. On November 10, 1998, Eduardo Makalintal resigned; on March 6, 2001, the remaining directors likewise elected Jose Ramirez to fill that Case Digest (G.R. No. 151969) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Initial Election and Hold-Over
- On February 27, 1996, during the Annual Stockholders’ Meeting of Valle Verde Country Club, Inc. (VVCC), nine directors were elected: Ernesto Villaluna, Jaime C. Dinglasan, Eduardo Makalintal, Francisco Ortigas III, Victor Salta, Amado M. Santiago, Jr., Fortunato Dee, Augusto Sunico, and Ray Gamboa.
- From 1997 to 2001, stockholders’ meetings lacked a quorum, resulting in the above-named directors continuing in a hold-over capacity.
- Resignations and Board Elections
- On September 1, 1998, Dinglasan resigned. On October 6, 1998, the remaining directors, constituting a quorum, elected Eric Roxas to fill the vacancy.
- On November 10, 1998, Makalintal resigned. On March 6, 2001, the remaining directors, still a quorum, elected Jose Ramirez to fill that vacancy.
- Proceedings Before SEC and RTC
- Victor Africa, a VVCC member, challenged Roxas’s election before the SEC (SEC Case No. 01-99-6177) and Ramirez’s election before the Regional Trial Court (RTC Civil Case No. 68726), invoking Sections 23 and 29 of the Corporation Code.
- The SEC, on June 3, 2003, nullified Roxas’s appointment; the RTC, on January 23, 2002, nullified Ramirez’s appointment. VVCC did not appeal the SEC decision.
- Petition for Review
- VVCC filed a petition for review on certiorari before the Supreme Court, raising the purely legal question of whether hold-over directors can elect replacements for vacancies caused by resignations.
- VVCC contended that under Section 23, terms last until successors are elected and qualified, so no term expiration had occurred before the board elections; and that Section 29 permits the board to fill such vacancies.
Issues:
- Whether the remaining directors, constituting a quorum, may elect a new director to fill a vacancy caused by the resignation of a hold-over director.
- Whether the hold-over period extends a director’s one-year term for purposes of Section 29’s “unexpired term” requirement.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)