TITLE VII

Q: Q College, Inc. offered 200 shares to Ms. DC for a subscription price of P20,000. The offer is
stated in a subscription letter form that states that initial payment should be made and the
subsequent payment should be in accordance with the terms and conditions of the college.
Later, Ms. DC, instead of sending the subscription form, sent a letter to the Board of Trustees of
Q College which states: “Please enter my subscription to dalawang daan (200) shares of your
capital stock with a par value of P100 each. Enclosed you will find (Babayaran kong lahat
pagkatapos na ako ay makapag-panhuli ng isda) pesos as my initial payment and the balance
payable in accordance with the law and the rules and regulation of the Quezon College. I hereby
agree to shoulder the expenses connected with said shares of stock. I further submit myself to
all lawful demands, decisions or directives of the Board of Q College and all its duly constituted
officers or authorities (ang nasa itaas ay binasa at ipinaliwanag sa akin sa wikang tagalog na
aking nalalaman).” No reply was sent by Q College to Ms. DC. Ms. DC died without having paid
any portion of the subscription price. Thereafter Q College presented a claim in Ms. DC’s testate
proceeding, for the collection of the sum of P20,000, representing the value of the subscription
to the capital stock. Will the claim prosper?

A: No the claim will not prosper. There was no perfected subscription contract. Q College did not
accept the term of payment suggested by Ms. DC during her lifetime. As Ms. DC’s letter is at
variance with the terms evidenced in the form, there was no absolute necessity on the part of
the college to express its agreement to DC’s offer in order to bind the latter. Conversely, said
acceptance was essential, because it would be unfair to immediately obligate the Q College
under DC’s promise to pay the price of the subscription after she had caused fish to be caught.
In other words, the relation between DC and Q College had only thus reached the preliminary
stage. There was no binding contract in the absence as in the present case of acceptance by the
Q College of the counter offer of DC.

Indeed, the need for express acceptance on the part of the Q College becomes the more
imperative, in view of the fact that the proposal of DC was to pay the value of the subscription
after she has harvested fish. There was a condition that was dependent upon DC’s sole will and
therefore, potestative in nature, rendering the obligation void under the New Civil Code.
(Trillana v. Quezon College Inc)

Q: X Corporation was organized by five individual incorporators who subscribed to the whole
authorized capital stock of P1,000,000 and who paid P500,000. The incorporators, all members
of the Board of Directors, agreed among themselves that the unpaid balance of their
subscription will be paid out of expected cash dividends. However, no dividends were ever
declared. The BOD decided to condone and cancel the unpaid subscriptions. This action was
ratified by the stockholders by unanimous vote at a proper meeting. The creditors of the
corporation sued the subscribers for their unpaid subscriptions. Can the creditors recover?
Reason.

SHARES OF STOCK
PARTICIPATION IN THE CORPORATION AS A STOCKHOLDER INDEPENDENT OF BEING THE LEGAL
COUNSEL

SALE/TRANSFER OF SHARES OF STOCK

SUBSCRIPTION TO SHARES OF STOCKS