Petitioner Sawadjaan was an appraiser/investigator in the Philippine Amanah Bank

(PAB) when on the basis of his report, a credit line was granted to Compressed Air
Machineries and Equipment Corporation (CAMEC) by virtue of the two parcels of land it
offered as collaterals. Meanwhile, Congress passed a law which created Al-Amanah
Investment Bank of the Philippines (AIIBP) and repealed the law creating PAB,
transferring all its assets, liabilities and capital accounts to AIIBP. Later, AIIBP
discovered that the collaterals were spurious, thus conducted an investigation and
found petitioner Sawadjaan at fault. Petitioner appealed before the SC which ruled
against him. Petitioner moved for a new trial claiming he recently discovered that AIIBP
had not yet adopted its corporate by-laws and since it failed to file within 60 days from
the passage of its law, it had forfeited its franchise or charter and thus has no legal
standing to initiate an administrative case. The motion was denied.

Issue:

Whether or not the failure of AIIBP to file its by-laws within the period prescribed results
to a nullity of all actions and proceedings it has initiated.

Ruling: NO.

The AIIBP was created by Rep. Act No. 6848. It has a main office where it conducts
business, has shareholders, corporate officers, a board of directors, assets, and
personnel. It is, in fact, here represented by the Office of the Government Corporate
Counsel, “the principal law office of government-owned corporations, one of which is
respondent bank.” At the very least, by its failure to submit its by-laws on time, the
AIIBP may be considered a de facto corporation whose right to exercise corporate
powers may not be inquired into collaterally in any private suit to which such
corporations may be a party.

Moreover, a corporation which has failed to file its by-laws within the prescribed period
does not ipso facto lose its powers as such. The SEC Rules on Suspension/Revocation
of the Certificate of Registration of Corporations, details the procedures and remedies
that may be availed of before an order of revocation can be issued. There is no showing
that such a procedure has been initiated in this case.