Emmanuel Esmer- Law 4A
Corporation Law
1.
As a corporate lawyer, I will advise my siblings the following advantages of
constituting a corporation instead of partnership:
First, in a corporation, the stockholders are not personally responsible
for its debts; the maximum amount a stockholder can lose is the amount of
his or her investment. Whereas in partnership, each partner in a partnership
is personally responsible for all the debts of the business.
Second, the easy transfer of ownership and the limited liability of
stockholders are attractive features to potential investors. Thus, it is relatively
easy for a corporation to raise capital by issuing shares of stock to many
investors. Whereas in partnership, partner cannot transfer his interest in the
partnership without the consent of all the other existing partners.
Third, a corporation has a capacity of continuous existence irrespective of
the death, withdrawal, insolvency or incapacity of the individual stockholders
or members. Whereas in partnership, the partnership is dissolves upon the
death of the partner.
Lastly, in a corporation, the management is centralized because the power
to do business and manage its affairs is vested only to the Board of Directors.
Whereas in partnership, if the management is not agreed upon, every partner
is an agent of the partnership.
1.1
No.
A Corporations cannot engage in the practice of a profession since they lack
the moral and technical competence required by the PRC.
2.
The issue in this case is whether or not a corporation is entitled of moral
damages.
In this case, the Supreme Court answered in affirmative.
The Supreme Court reasoned out that while a corporation is a juridical
person, and it has no feelings to experience physical sufferings or such
sentiments as wounded feelings, serous anxiety, mental anguish or moral
shock, it may have a good reputation which if besmirched may also be a
ground for award of moral damages.
However, in this case, AMEC used the provision of the Civil Code (Art 2210
para.7). This provision expressly authorizes the recovery of moral damages
in cases of libel, slander or any other form of defamation. It does not qualify
whether the plaintiff is a natural or juridical person. Therefore, a juridical
person such as a corporation can validly complain for libel or any other form
of defamation and claim for moral damages which, if besmirched, may also
be a ground for the award of moral damages.
3.
No. The Doctrine of Separate Juridical Personality will set in.
A corporation is vested by law with a personality separate and distinct from
the people comprising it. Obligations incurred by corporate officers, acting as
such corporate agents, are not theirs but the direct accountabilities of the
corporation they represent. As such, they should not be generally held jointly
and solidarily liable with the corporation.
4.
Contention is incorrect.
Doctrine applies even in the absence of evil intent, because of the direct
violation of a central corporate law principle of separating ownership from
management. Doctrine in such cased is based on estoppel: if stockholders
do not respect the separate entity, others cannot also be expected to be
bound by the separate juridical entity.
5.
No.
A corporation has a separate and distinct personality from those who
represent it. Thus, the sheriff cannot levy upon the property of the corporation
where the defendant belongs.
6.
None. Corporation continues to exist.
Business can go on as usual because a corporation is an independent legal
entity that continues to exist even as shareholders change.
7.
The Doctrine of Centralized management states that all corporate powers
are exercised by the board of Directors. These powers include:
1. Powers provided by the Corporation code;
2. Conducts all the business of the corporation and controls and
holds all the properties of the corporation.
8.
The Doctrine of Juridical Entity essentially states that a corporation is vested
by law with a personality separate and distinct from the people comprising it.
The Doctrine of Limited Liability states that the stockholders are not
personally responsible for corporation’s debts; the maximum amount a
stockholder can lose is the amount of his or her investment.
Doctrine of Piercing the Veil of Corporate Fiction is when the separate
personality rule may be disregarded, or the veil of corporate fiction may be
pierced attaching personal liability against responsible person if the
corporation's personality "is used to defeat public convenience, justify wrong,
protect fraud or defend crime, or is used as a device to defeat the labor laws.
Trust Fund Doctrine is the principle that corporate assets are held as a trust
fund for the benefit of shareholders and creditors and that the corporate
officers have the fiduciary duty to keep them intact and unimpaired.
9.
No.
Applying again the doctrine of Separate Juridical Personality, the stockholder
cannot be held liable to answer the debts of the corporation except in
circumstances that may warrant the piercing of the veil of corporate fiction
wherein the stockholder maybe deemed solidarily liable. But in this case, is
not enough to pierce the veil.
10.
I think the purpose why there is classification of shares is that for the
corporation to provide different rights to shareholder. For instance, founders’
shares may be given certain rights and privileges not enjoyed by the owners
of other stocks.
11.
In our best interest, I will issue preferred shares instead of common shares
because the management of the corporation will remain within the circle of
my siblings. If you allow others to decide by way of suffrage, it will create
chaos and the principle of centralized management maybe defeated.