Pabustan, Mheryza De Castro

Midterm Exam
Corporation Law - 3A

1. If I were to put up a business, I will start a Construction Company. The construction industry
has been existent for many years unlike some other industries that have only existed in the last
decade. It is not always necessary to develop something new or unique. If you can offer an
existing product at a lower price, better quality, or ideally, both, you’ll have plenty of customers.
Customers today are less likely to do home repairs and projects on their own and prefer to hire an
outside contractor. For a Millennial like me, construction is one of the few industries where it’s
possible to begin without taking up an engineering course or any course related to it.

2. The advantages for setting up a one person corporation is that they provide an easier way to
establish a business in the country. Such advantages allow a single person to register as an OPC,
reduce the minimum capital requirement, limit the liability for business owners, perpetual
existence, open to foreign investors, and complete control of the business.

3. In the construction industry, the advantages of having a regular corporation are: owners have
limited liability, it means that the creditors can only go after the assets of the corporation and not
the the personal assets of the stockholders in the settlement of the corporation’s liabilities. Also,
corporations can exist with continuity. Unlike in a one person corporation where the death of the
owner ceases its existence, the death of a shareholder will not terminate the existence of a
corporation. You can also be an employee of your own corporation. A corporation is a distinct
entity from its owners, they can be an employee or officers of the corporation. Thus, they can
also receive compensation aside from the dividends they may receive from the corporation.

4. The primary purpose of my company is to aspire always to be known as a construction

company who sincerely upholds the calling for fair trade, quality products, and excellent services
to my client.

The secondary purpose of my business is to aim quality over quantity and to create a working
environment within the company or corporation dedicated to excellence and mutual respect.

5. My corporation may lawfully conduct all acts that are appropriate to running construction
company like hiring employees, advertising the company, joining exhibitions and conventions to
attract more customers, leasing trucks and other construction equipments and any other means
necessary to accomplish the purpose for which the corporation was formed.

 6. Name A: MDPab Corporation

Name B: M.DCPab Corporation

The SEC should allow MDPab Corporation to be registered because the was the name was
coined by it for its own use as a unique and distinct name to distinguish it from other
corporations, partnerships, or businesses. Its similarity does not intend to mislead or cause
confusion to an ordinary person. Also, MDPab Corporation does not have the same line of
business as M.DCPab Corporation.

PART 2

1.
a) Briefly argue in favor of XYZ Corp.

BOC’s agent were not correct in seizing the properties of XYZ Corp. XYZ Corporation were not
created as a sham company or to defraud others. It must be certain that the corporate fiction was
misused to such an extent that injustice, fraud, or crime was committed against another, in
disregard of its rights. The wrongdoing must be clearly and convincingly established; it cannot
be presumed. In this case, XYZ Corporation was not created as a sham company or to defraud
others. The liabilities and existence of ABC. Corp is separate and distinct from XYZ Corp. being
that the two companies are separately incorporated and each company has its own SEC
certificate of incorporation and separate corporate by-laws.

b) Briefly argue in favor of the BOC agents were wrong.

The BOC agents' acts were valid. Under Sec 79, RCC, the surviving corporation shall be
responsible for all the liabilities and obligations of each constituent corporation has itself
incurred such liability or obligations; and any pending claim, action or proceeding brought by or
against any constituent corporation may be prosecuted by or against the surviving or
consolidated corporation. In the case at bar, the BOC agents confiscated the properties of XYZ
Corp. which is valid since there was it automatically acquires all their rights, privileges, powers
and liabilities.

c) As judge, briefly DECIDE.

As a judge, I will decide in favor of XYZ Corp because they just bought the shares, they did not
transfer transfer equity.