Title
Interpretation of Cooperative Code Articles 28 and 43
Law
Cda Memorandum Circular No. 92-003
Decision Date
Mar 17, 1992
CDA Memorandum Circular No. 92-003 clarifies that while elective government officials, except barangay officials, cannot serve as officers or directors of cooperatives, barangay captains retain eligibility, and outlines the governance structure and relationship restrictions for cooperative boards.

Questions (CDA MEMORANDUM CIRCULAR NO. 92-003)

Elective officials of the government, except barangay officials, are ineligible to become officers and directors of cooperatives.

No. Barangay captains (being barangay officials) are allowed to be officers and directors of cooperatives under the interpretation.

No. The memorandum states the barangay captain remains qualified because his seat in the municipal council is by virtue of his ABC presidency, not because he was elected to that council.

It does not convert him into an elective municipal council member for purposes of Article 28(2). His council seat is tied to his role as ABC president.

The Board of Directors elects from among themselves only the chairman and vice-chairman.

Yes. The Board may elect/appoint other officers of the cooperative from outside the Board in accordance with the cooperative’s by-laws.

Officers shall not be removed except for cause after due hearing; loss of confidence is not a valid ground unless evidenced by acts or omissions showing loss of honesty and integrity.

It must be evidenced by acts or omissions that show loss of honesty and integrity of the officer.

Yes. Article 43 prohibits no two or more persons within the third degree of consanguinity or affinity from serving as elective or appointive officers in the same board.

The memorandum clarifies it applies within each category because the Code says “shall serve as elective or appointive officers in the same board.” Thus, the restriction is applied by officer category (board-elected vs board-appointed) in practice.

1) Officers of the Board elected by board members among themselves (e.g., Chairman and Vice-Chairman), and 2) Officers elected/appointed by the Board (e.g., Secretary, Treasurer and other officers as prescribed by the by-laws).

Parent to child.

Grandparent to child, and brother to sister.

Uncle to child, aunt to child, and greatgrandparent to child.

Parent-in-law to daughter/son-in-law.

Greatgrandparent-in-law to daughter/son-in-law, and uncle/aunt-in-law to niece/nephews-in-law.

Yes, because they are within the third civil degree by consanguinity (brother to sister is second degree, which is within third), and the prohibition is that no two or more persons within the third degree of consanguinity or affinity shall serve as elective officers in the same board/category.

Under the memorandum’s clarification, the prohibition is applied within each category. So the restriction is assessed per category (board-elected vs board-appointed), not necessarily across categories.


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