Question & AnswerQ&A (Act No. 2206)
Act No. 2206 amends Section One of Act Numbered Five Hundred Thirty-Six regarding recognizances, stipulations, bonds, and undertakings, particularly about who may act as surety for such obligations, focusing on corporations organized under Philippine Islands laws.
Corporations incorporated under the laws of the United States or corporations organized under the laws of the Philippine Islands, having power to guarantee fidelity and to execute and guarantee bonds and undertakings in judicial proceedings and contracts with public authorities, are allowed.
No. The Act explicitly prohibits any officer or person with approval authority from exacting that a guarantee must be furnished by a specific guarantee company.
Such recognizance, stipulation, bond, or undertaking must be approved by the head of the Department, court, judge, officer, board, or body, whether executive, legislative, or judicial, that is required to approve or accept the same.
No. They must be authorized to do business in the Philippine Islands as per the Act's provisions and must have contracts with the Government of the Philippine Islands authorizing them to be sureties on official recognizances, stipulations, bonds, and undertakings.
No. The provisions of Section Two and the following sections of this Act shall not be applicable to corporations organized under the laws of the Philippine Islands.
The Act is considered retroactive, operative from January 13, 1913.
It covers duties or contracts made with any public authority (Insular, provincial, municipal or otherwise) or for doing or refraining from doing anything specified in such recognizance, stipulation, bond, or undertaking.
Yes. When required or permitted by law or regulations, execution or guarantee by a single qualified corporation suffice for the obligations.
Corporations must have the power to guarantee fidelity of persons holding positions of public or private trust, which is a prerequisite for their acceptance as surety in recognizances, bonds, and undertakings.