7/14/2019 13_Marvel Building Corporation Et Al vs David Case Digest

13_Marvel Building Corporation et. al. vs David, 94 Phil. 376

Facts:

Marvel Building Corporation was incorporated in February 12, 1947 wherein its articles
o! incorporation contained a capital stoc" o! # 2,$$$,$$$%$$ o! which &a'ority o! its
stoc"holders are Maria B% Castro(#resident), *&ado *% +atco, egundo -sguerra and Ma.i&o
Cristobal(ecretary/0reasurer) !ro& the total o! eleven(11) stoc"holders% uring the e.istence
o! the corporation, it acuired assets including buildings, na&ely, *guinaldo Building, 3ise
Building and ewey Boulevard/#adre Faura Mansion% 0owards the end o! year 194, internal
revenue e.a&iners discovered that !ro& the 11 stoc" certi!icates, all o! it were endorsed in the
ban" by the subscribers, e.cept the one subscribed by Maria B% Castro% 0hey also discovered
that there were no business &eeting held by the board o! directors, no by/laws and that the
corporation never had any reports o! their transactions or a!!airs% *s a result, ecretary o!
Finance reco&&ended the collection o! war pro!it ta.es assessed against Maria B% Castro in the
a&ount o! #5,695,96$%7 and seie the three(5) buildings na&ed above%

#lainti!!(Marvel Building Corporation) !iled a co&plaint !or the release o! the seied
property contending that said property are owned by the corporation and not solely by Maria
Castro% 0he trial court ruled in !avor o! planti!! and en'oin Collector o! 8nternal evenue !ro&
selling the sa&e% Collector o! 8nternal evenue appealed, and C* ruled that trial court !ailed to
show that Maria B% Castro is not the true owner o! all the stoc" certi!icates o! the corporation,
there!ore con!iscation o! the property against the corporation is 'usti!ied% ence this petition
arise%

8ssue: 3hether or not Maria B% Castro is the sole owner o! all the stoc"s o! Marvel Corporation
and the other stoc"holders are &ere du&&ies;

eld:

+es% Maria B% Castro is the sole and e.clusive owner o! all the shares o! stoc" o! the
Marvel Building Corporation and that the other partners are her du&&ies% ection 9, ule 125
o! the ules o! Court and section 42 o! the #rovisional law !or the application o! the #enal Code,
applies in this case pursuant to circu&stantial evidence as the basis o! 'udg&ent%

8n general the evidence o!!ered by the plainti!!s is testi&onial and direct evidence, easy
o! !abrication< that o!!ered by de!endant, docu&entary and circu&stantial, not only di!!icult o!
!abrication but in &ost cases !ound in the possession o! plainti!!s% 0he circu&stantial evidence is
not only convincing< it is conclusive% 0he e.istence o! endorsed certi!icates, discovered by the
internal revenue agents between 194 and 1949 in the possession o! the ecretary/0reasurer,
the !act that twenty/!ive certi!icates were signed by the president o! the corporation, !or no
 'usti!iable reason, the !act that two sets o! certi!icates were issued, the undisputed !act that
Maria B% Castro had &ade enor&ous pro!its and, there!ore, had a &otive to hide the& to evade
the pay&ent o! ta.es, the !act that the other subscribers had no inco&es o! su!!icient &agnitude
to 'usti!y their big subscriptions, the !act that the subscriptions were not receipted !or and
deposited by the treasurer in the na&e o! the corporation but were "ept by Maria B% Castro

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7/14/2019 13_Marvel Building Corporation Et Al vs David Case Digest

hersel!, the !act that the stoc"holders or the directors never appeared to have ever &et to
discuss the business o! the corporation, the !act that Maria B% Castro advanced big su&s o!
&oney to the corporation without any previous arrange&ent or accounting, and the !act that the
boo"s o! accounts were "ept as i! they belonged to Maria B% Castro alone = these !acts are o!
patent and potent signi!icance% 0his i&plied that Maria B% Castro would not have as"ed the& to
endorse their stoc" certi!icates, or be "eeping these in her possession, i! they were really the
owners% 0hey never would have consented that Maria B% Castro "eep the !unds without receipts
or accounting, nor that she &anages the business without their "nowledge or concurrence, were
they owners o! the stoc"s in their own rights% -ach and every one o! the !acts all set !orth above,
in the sa&e &anner, is inconsistent with the clai& that the stoc"holders, other than Maria B%
Castro, own their shares in their own right%

 >n the other hand, each and every one o! the&, and all o! the&, can point to no other
conclusion than that Maria B% Castro was the sole and e.clusive owner o! the shares and that
they were only her du&&ies%

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