Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Same; When corporation which engaged in illegal banking, The facts are stated in the opinion of the Court.
may be dissolved.—A corporation, which misused its corporate
funds and franchise by engaging in illegal banking, may be Solicitor General Arturo A. Alafriz and SolicitorE. M. Salva
dissolved. Its acts were willful, were repeated 59,463 times and for petitioner.
the continuance of its illegal operations causes public injury
owing to the number of persons affected thereby. A writ of quo Sycip, Salazar, Luna, Manalo & Feliciano for respondents.
warranto for its dissolution is proper,
Natalio M. Balboa and F.E. Evangelista for the receiver.
Courts; Supreme Court has concurrent jurisdiction with Court
of First Instance to issue writ of quo warranto.—This Court is CONCEPCION, C.J.:
This is an original quo warranto proceeding, initiated by the ________________
Solicitor General, to dissolve the Security and Acceptance
1
Corporation for allegedly engaging in banking operations Which, as amended on May 8, 1961, authorized it:
without the authority required therefor by the General Banking
Act (Republic Act No. 337). Named as respondents in the 1. “1. To extend credit facilities for home building and
petition are, in addition to said corporation, the following, as agricultural, commercial and industrial projects;
alleged members of its Board of Directors and/or Executive 2. 2. To extend credit, give loans, mortgages and pledges,
Officers, namely: either as principal, agent, broker of attorney-in-fact,
upon every and all kinds and classes of products,
“NAME POSITION materials, goods, merchandise, and other properties,
Rosendo T. Resuello President & Chairman of real or personal of every kind and nature;
the Board 3. 3. To draw, accept, endorse, purchase, own, sell,
discount, mortgage, assign or otherwise dispose of,
Pablo Tanjutco Director negotiate or collect accounts or notes receivables,
Arturo Soriano Director negotiable instruments, letters of credit and other
Ruben Beltran Director evidence of indebtedness;
Bienvenido V. Zapa Director & Vice-President 4. 4. To purchase, acquire, and take over, all or any part of
the rights, assets and business of any person,
Pilar G. Resuello Director & Secretary-Treasurer
partnership, corporation or association, and to
Ricardo D Balatbat Director & Auditor undertake and assume the liabilities and obligations of
Jose R. Sebastian Director & Legal Counsel such person, partnership, corporation or association
Vito Tanjutco, Jr. Director & Personnel Manager” whose rights, assets, business or property may be
purchased, acquired or taken over;
60 5. 5. To issue bonds, debentures, securities, collaterals
and other obligations or otherwise incur indebtedness
in such manner as may be ascertained by the
60 SUPREME COURT REPORTS ANNOTATED
corporation; and
Republic vs. Security Credit and Acceptance Corp., et al. 6. 6. To undertake the management, promotion, financing
and/or collection services of the operation of the
The record shows that the Articles of Incorporation of business, industry or enterprises of any person,
defendant corporation1 were registered with the Securities and partnership, corporation or association in so far as may
Exchange Commission on March 27, 1961; that the next day, be permitted under the laws of the Philippines.” (Italics
the Board of Directors of the corporation adopted a set of by- supplied.)
laws,2 which were filed with said Com-
2
Empowering said Board, inter alia: corporation had applied with the Securities and Exchange
Commission for the registration and licensing of its securities
“c) To pay for any property or rights acquired by the under the Securities Act; that, before acting on this application,
corporation or to discharge obligations of the corporation either the Commission referred it to the Central Bank, which, in turn,
wholly or partly in money or in stock, bonds, debentures or gave the former a copy of the above-mentioned opinion, in line
other securities of the corporation; with which, the Commission advised the corporation on
December 5, 1961, to comply with the requirements of the
“d) To lend or borrow money for the corporation with or General Banking Act; that, upon application of members of the
without security and for such purpose to accept or create, make Manila Police Department and an agent of the Central Bank, on
and issue mortgages, bonds, deeds of trust and negotiable May 18, 1962, the Municipal Court of Manila issued Search
instruments or securities. secured by mortgage or pledge of Warrant No. A-1019; that, pursuant thereto, members of the
property belonging to the corporation; provided, that as intelligence division of the Central Bank and of the Manila
hereinafter provided, the proper officers of the corporation Police Department searched the premises of the corporation
shall have these powers. unless expressly limited by the Board and seized documents and records thereof relative to its
of Directors: x x x”; (Italics supplied). business operations; that, upon the return of said warrant, the
seized documents and records were, with the authority of the
61 court, placed under the custody of the Central Bank of the
Philippines; that, upon examination and evaluation of said
VOL. 19, JANUARY 23, 1967 61 documents and records, the intelligence division of the Central
Bank submitted, to the Acting Deputy Governor thereof, a
Republic vs. Security Credit and Acceptance Corp., et al.
memorandum dated September 10, 1962, finding that the
corporation is:
mission on April 5, 1961; that on September 19, 1961, the
Superintendent of Banks of the Central Bank of the Philippines 1. “1. Performing banking functions, without requisite
asked its legal counsel an opinion on whether or not said certificate of authority from the Monetary Board of the
corporation is a banking institution, within the purview of Central Bank, in violation of Secs. 2 and 6 of Republic
Republic Act No. 337; that, acting upon this request, on Act 337, in that it is soliciting and accepting deposit
October 11, 1961, said legal counsel rendered an opinion from the public and lending out the funds so received’,
resolving the query in the affirmative; that in a letter, dated
January 15, 1962, addressed to said Superintendent of Banks, 62
the corporation through its president, Rosendo T. Resuello, one
of defendants herein, sought a reconsideration of the
aforementioned opinion, which reconsideration was denied on 62 SUPREME COURT REPORTS ANNOTATED
March 16, 1962; that, prior thereto, or on March 9, 1961, the Republic vs. Security Credit and Acceptance Corp., et al.
1. “2. Soliciting and accepting savings deposits from the seized by the combined MPD-CB team was conducted
general public when the company’s articles of by this Department. The examination disclosed the
incorporation authorize it only to engage primarily in following findings:
financing agricultural, commercial and industrial
projects, and secondarily, in buying and selling stocks 1. a. Considering the extent of its operations, the Security
and bonds of any corporation, thereby exceeding the Credit and Acceptance Corporation, Inc., receives
scope of its powers and authority as granted under its deposits from the public regularly. Such deposits are
charter; consequently such acts are ultra-vires; treated in the Corporation’s financial statements as
2. “3. Soliciting subscriptions to the corporate shares of conditional subscription to capital stock. Accumulated
stock and accepting deposits on account thereof, deposits of P5,000 of an individual depositor may be
without prior registration and/or licensing of such converted into stock subscription to the capital stock of
shares or securing exemption therefor, in violation of the Security Credit and Acceptance Corporation at the
the Securities Act; and option of the depositor. Sale of its shares of stock or
3. “4. That being a private credit and financial institution, subscriptions to its capital stock are offered to the
it should come under the supervision of the Monetary public as part of its regular operations.
Board of the Central Bank, by virtue of the transfer of 2. b. That out of the funds obtained from the public
the authority, power, duties and functions of the through the receipt of deposits and/or the sale of
Secretary of Finance, Bank Commissioner and the securities, loans are made regularly to any person by
defunct Bureau of Banking, to the said Board, pursuant the Security Credit and Acceptance Corporation,
to Secs. 139 and 140 of Republic Act 265 and Secs. 88
and 89 of Republic Act 337." (Italics supplied.) that 63
upon examination and evaluation of the same records of
the corporation, as well as of other documents and VOL. 19, JANUARY 23, 1967 63
pertinent papers obtained elsewhere, the Superintendent Republic vs. Security Credit and Acceptance Corp., et al.
of Banks, submitted to the Monetary Board of the
Central Bank a memorandum dated August 28, 1962,
stating inter alia A copy of the Memorandum Report dated July 30, 1962 of the
4. “11. Pursuant to the request for assistance by the Chief, examination made by Examiners of this Department of the
Intelligence Division, contained in his Memorandum to seized books and records of the Corporation is attached hereto.
the Governor dated May 23, 1962 and in accordance
with the written instructions of Governor Castillo dated “12. Section 2 of Republic Act No. 337, otherwise known as
May 31, 1962, an examination of the books and records the General Banking Act, defines the term, ‘banking
of the Security Credit and Loans Organizations, Inc. institution’ as follows:
‘Sec. 2. Only duly authorized persons and entities may engage that, acting upon said memorandum of the Superintendent of
in the lending of funds obtained from the public through the Banks, on September 14, 1962, the Monetary Board
receipts of deposits or the sale of bonds, securities, or promulgated its Resolution No. 1095, declaring that the
obligations of any kind and all entities regularly conducting corporation is performing banking operations, without having
operations shall be considered as banking institutions and shall first complied with the provisions of Sections 2 and 6 of
be subject to the provisions of this Act, of the Central Bank Republic Act No. 337;3 that on September 25, 1962, the
Act, and of other pertinent laws. x x x
________________
“13. Premises considered, the examination disclosed that the
Security Credit and Acceptance Corporation is regularly 3
”Sec. 2. Only duly authorized persons and entities may engage
lending funds obtained from the receipt of deposits and/or the in the lending of funds obtained from the public through the
sale of securities. The Corporation therefore is performing receipts of deposits or the sale of bonds, securities, or
‘banking functions’ as contemplated in Republic Act No. 337, obligations of any kind, and all entities regularly conducting
without having first complied with the provisions of said Act. such operations shall be considered as banking institutions and
Recommendations: shall be sub