Ang Mga Kaanib vs.

Iglesia (December 12, 2001)

FACTS: Respondent Iglesia ng Dios Kay Cristo Jesus, Haligi at Suhay ng Katotohanan (Church of God in
Christ Jesus, the Pillar and Ground of Truth), is a non-stock religious society or corporation registered in
1936. Sometime in 1976, one Eliseo Soriano and several other members of respondent corporation
disassociated themselves from the latter and succeeded in registering on March 30, 1977 a new non-
stock religious society or corporation, named Iglesia ng Dios Kay Kristo Hesus, Haligi at Saligan ng
Katotohanan. Respondent corporation filed with the SEC a petition to compel the Iglesia ng Dios Kay
Kristo Hesus, Haligi at Saligan ng Katotohanan to change its corporate name to another name that is not
similar or identical to any name already used by a corporation, partnership or association registered
with the Commission. Petitioner is compelled to change its corporate name and be barred from using
the same or similar name on the ground that the same causes confusion among their members as well
as the public. SEC rendered a decision ordering petitioner to change its corporate name. The Court of
Appeals rendered the assailed decision affirming the decision of the SEC En Banc.

ISSUE: Whether the court of appeals failed to properly appreciate the scope of the constitutional
guarantee on religious freedom

RULING: The additional words "Ang Mga Kaanib " and "Sa Bansang Pilipinas, Inc." in petitioner's name
are, as correctly observed by the SEC, merely descriptive of and also referring to the members, or
kaanib, of respondent who are likewise residing in the Philippines. These words can hardly serve as an
effective differentiating medium necessary to avoid confusion or difficulty in distinguishing petitioner
from respondent. This is especially so, since both petitioner and respondent corporations are using the
same acronym — H.S.K.; not to mention the fact that both are espousing religious beliefs and operating
in the same place. The fact that there are other non-stock religious societies or corporations using the
names Church of the Living God, Inc., Church of God Jesus Christ the Son of God the Head, Church of
God in Christ & By the Holy Spirit, and other similar names, is of no consequence. It does not authorize
the use by petitioner of the essential and distinguishing feature of respondent's registered and
protected corporate name. Ordering petitioner to change its corporate name is not a violation of its
constitutionally guaranteed right to religious freedom. In so doing, the SEC merely compelled petitioner
to abide by one of the SEC guidelines in the approval of partnership and corporate names, namely its
undertaking to manifest its willingness to change its corporate name in the event another person, firm,
or entity has acquired a prior right to the use of the said firm name or one deceptively or confusingly
similar to it. The instant petition for review is DENIED. The appealed decision of the Court of Appeals is
AFFIRMED in toto.

UY SIULIONG, MARIANO LIMJAP, GACU UNG JIENG, EDILBERTO CALIXTO and

UY CHO YEE
vs.
THE DIRECTOR OF COMMERCE AND INDUSTRY
G.R. No.L-15429. December 1, 1919
FACTS:

Prior to the presentation of the petition the petitioners had been associated
together as partners, which partnership was known as "mercantil regular colectiva,
under the style and firm name of "Siuliong y Cia. That the petitioners herein, who had
theretofore been members of said partnership of "Siuliong y Cia.," desired to dissolve
said partnership and to form a corporation composed of the same persons as
incorporators, to be known as "Siulong y Compañia, Incorporada.
While the articles of incorporation of "Siuliong y Cia., Inc." states that its purpose
is to acquire and continue the business, with some of its objects or purposes, of Siuliong
& Co., it will be found upon an examination of the purposes enumerated in the proposed
articles of incorporation of "Siuliong y Cia., Inc.," that some of the purposes of the
original partnership of "Siuliong y Cia." have been omitted.

ISSUE:

Whether or not a corporation can engage in other purposes other than that stated
in the purpose clause of its articles of incorporation.

RULING:

YES.

A corporation may be organized under the laws of the Philippine Islands for
mercantile purposes, and to engage in such incidental business as may be necessary
and advisable to give effect to, and aid in, the successful operation and conduct of the
principal business. All of the power and authority included in the articles of
incorporation of "Siuliong y Cia., Inc.," enumerated above in paragraph 4 of the Articles
of Incorporation are only incidental to the principal purpose of said proposed
incorporation, to wit: "mercantile business." The purchase and sale, importation and
exportation of the products of the country, as well as of foreign countries, might make
it necessary to purchase and discount promissory notes, bills of exchange, bonds,
negotiable instruments, stock, and interest in other mercantile and industrial
associations. It might also become important and advisable for the successful operation
of the corporation to act as agent for insurance companies as well as to buy, sell and
equip boats and to buy and sell other establishments, and industrial and mercantile
businesses. The proposed articles of incorporation do not authorize the petitioners to
engage in a business with more than one purpose, the Court do not mean to be
understood as having decided that corporations under the laws of the Philippine Islands
may not engage in a business with more than one purpose. Such an interpretation
might work a great injustice to corporations organized under the Philippine laws. Such
an interpretation would give foreign corporations, which are permitted to be registered
under the laws here and which may be organized for more than one purpose, a great
advantage over domestic corporations. It was not the intention of the legislature to give
foreign corporations such an advantage over domestic corporations.

REPUBLIC PLANTERS BANK

vs.
 COURT OF APPEALS and FERMIN CANLAS
G.R. No. 93073. December 21, 1992

FACTS:

On September 18, 1961, private respondent Corporation secured a loan from

petitioner in the amount of P120,000.00. As part of the proceeds of the loan, preferred
shares of stocks were issued to private respondent Corporation, through its officers
then, private respondent Adalia F. Robes and one Carlos F. Robes. In other words,
instead of giving the legal tender totaling to the full amount of the loan, which is
P120,000.00, petitioner lent such amount partially in the form of money and partially
in the form of stock certificates. Said stock certificates were in the name of private
respondent Adalia F. Robes and Carlos F. Robes, who subsequently, however, endorsed
his shares in favor of Adalia F. Robes. Said certificates of stock bear the following terms
and conditions:
The Preferred Stock shall have the following rights, preferences, qualifications
and limitations, to wit: Of the right to receive a quarterly dividend of One Per Centum
(1%), cumulative and participating. That such preferred shares may be redeemed, by
the system of drawing lots, at any time after two (2) years from the date of issue at the
option of the Corporation
On January 31, 1979, private respondents proceeded against petitioner and filed
a Complaint anchored on private respondents' alleged rights to collect dividends under
the preferred shares in question and to have petitioner redeem the same under the terms
and conditions of the stock certificates.

ISSUES:

Whether or not there is a difference between a preferred share from a redeemable

share.
Whether or not petitioner can be compelled by defendant to redeem the preferred
shares issued to the private respondent.

RULING:

YES.

A preferred share of stock is one which entitles the holder thereof to certain
preferences over the holders of common stock. The preferences are designed to induce
persons to subscribe for shares of a corporation. Preferred shares take a multiplicity of
forms. The most common forms may be classified into two: (1) preferred shares as to
assets; and (2) preferred shares as to dividends. The former is a share which gives the
holder thereof preference in the distribution of the assets of the corporation in case of
liquidation; the latter is a share the holder of which is entitled to receive dividends on
said share to the extent agreed upon before any dividends at all are paid to the holders
of common stock. There is no guaranty, however, that the share will receive any
dividends.
Under the old Corporation Law in force at the time the contract between the
petitioner and the private respondents was entered into, it was provided that "no
corporation shall make or declare any dividend except from the surplus profits arising
from its business, or distribute its capital stock or property other than actual profits
among its members or stockholders until after the payment of its debts and the
termination of its existence by limitation or lawful dissolution." Similarly, the present
Corporation Code provides that the board of directors of a stock corporation may declare
dividends only out of unrestricted retained earnings. The Code, in Section 43, adopting
the change made in accounting terminology, substituted the phrase "unrestricted
retained earnings," which may be a more precise term, in place of "surplus profits arising
from its business" in the former law.