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Strong V Repide
Strong V Repide
1Art. 1712 Civil Code “An agency stated in general terms only includes acts of strict ownership an express mandate is required”
administration. In order to compromise, alienate, mortgage, or to execute any, other act of
"2. Mandatories, the properties with the administration or alienation of which
2. The machinations with which the defendant is charged consist in the they have been charged." (See Manresa’s Commentary on this article, vol. 10, p.
suppression of his identity while negotiating for the stock and were paying for it 100.)
and also of his intention as majority stockholder in the company to close the
negotiation then pending with the Government for the sale of the friar lands Their accountability is this expressly confined to property "with the
owned by the company. The prospect of such a sale would have materially administration or alienation of which they are charged." They are not charged
affected the price of the stock. This negotiation and the defendant’s management with the administration or alienation of the shares in the hands of the members
of it in behalf of the vendors was known to Jones and had been for same time a and in respect to them they are not mandatories and hold no trust relation to the
matter of public notoriety and newspaper comment in the Islands. owners.
The members have no title to corporate property as such, which, on the contrary,
Neither the plaintiff nor her agent applied to the defendant for information or is distinct from the shares held by them. The right of the associate in a society is
communicated with him in a way. Nor is the defendant shown to have put forth only in effect a right to an interest remaining after liquidation and not an actual
statements, either in a public or a private, for the purpose of influencing the sale. and active ownership in the objects which compose the social property.
Consequently the defendant violated no duty in not communicating to the
The court found nothing irregular with the defendant’s acts. He was its managing plaintiff his purpose in buying her shares and has been guilty of no fraud.
director and conducted this transactions without formal authorization by his
society but after informal discussion of the director’s meeting. He was also in
person the holder of a large majority of the stock, thus not only controlling the
negotiations with the Government through all its stages but also its ultimate
result by his own vote in the shareholders’ meeting.
Did his knowledge of what was being done and what would be done incapacitate
him dealing with a fellow- stockholder not so enlightened? Was he in duty bound
to disclose either his information or his intentions or even his identity?
While up to a recent date we have no private corporations, so termed in our
statutes, we have their likeness in anonymous societies or partnerships. The
essential concept of a corporation is a legal entity endowed with succession of
membership and merging in itself the primary individual liability and right of the
societies. Individual liability is completely extinguished; the membership is
determined by ownership of stock and the managers are chosen by stockholders.
They are declared to be mandatories of the society (Code of Commerce, 156), and
they are also responsible to the individual stockholders (Dalloz, Societe, arts.
1499 and 1539). But nowhere to do we find their responsibility extended beyond a
corporate property actually under their control. It is not suggested that they owe
any duty to the members in respect to their individual stock, which is fully
recognized as a separate property, whose character and transmission is provided
for in laws peculiar to it. This appears to be the limit of their responsibility under
the law governing this case. Article 1459 of the Civil Code
reads:jgc:chanroblecom.ph
"The following persons can not acquire by purchase, even at public or judicial
auction, neither in person by an agent:jgc:chanrobles.com.ph
"1. The tutor or protutor, the goods of the person or persons who are under his
tutelage.