CENTRAL COOPERATIVE EXCHANGE, INC.

V AUTHOR: PAGCALIWAGAN
TIBE, SR. NOTES: Review, on certiorari, of a decision of the CA,
G.R. No. L-27972 June 30, 1970 affirming the decision of the CFI of Manila dismissing after
TOPIC: Fixing Compensation of Directors and Officers trial a complaint filed by petitioner against respondent for
PONENTE: Reyes, J.B.L., J. the refund of certain amounts received by the latter from the
corporation while he served as a member of the BOD of the
Exchange.
FACTS:
 Petitioner Central Cooperative Exchange, Inc. (CCE) is a national federation of farmers’ cooperative marketing
associations or FACOMAS, scattered throughout the country
 Its single majority stockholder is the former Agricultural Credit and Cooperative Financing Administration
(ACCFA), now Agricultural Credit Administration (ACA).
 Respondent Tibe, Sr. (TIBE) as a member of CCE’s BOD, representing FACOMAS in Eastern Visayas, drew and
collected from CCE cash advances worth P5,668.
 TIBE had also drawn several sums, worth P14,436.95, representing:
 Commutable per diems for attending meetings of the BOD in Manila,
 Per diems and transportation expenses for FACOMA visitations,
 Representation expenses and commutable discretionary funds
ISSUE(S): WON the BOD of the CCE had the power and authority to adopt various resolutions which appropriated funds
of the corporation for the enumerated expenses for the members of the said board.

HELD: NO.
RATIO:
The questioned resolutions are contrary to the By-Laws of the federation and, therefore, are not within the power of the
board of directors to enact. The By-Laws, in the aforequoted Section 8, explicitly reserved unto the stockholders the power
to determine the compensation of members of the board of directors, and the stockholders did restrict such compensation
to “actual transportation expenses plus the per diems of P30.00 and actual expenses while waiting” Even without the
express reservation of said power, the directors are not entitled to compensation, for the law is well-settled that directors of
corporations presumptively served without compensation and in the absence of an express agreement or a resolution in
relation thereto, no claim can be asserted therefor.

Section 28 of the Corporation Law giving the exercise of corporate powers and the control of the corporation's business
and property to the board of directors, or a provision of the by-laws empowering the board with "general supervision and
control of the affairs and property of the
(corporation)" is no justification for the adoption by the board of a resolution providing themselves with compensation.
These provisions of the law and the bylaw pertain to the general powers of the board merely and do not extend to giving
the members of the board the compensation where the matter of providing for the compensation is specifically withheld
from the board of directors and reserved to the stockholders.
CASE LAW/ DOCTRINE:
The By-Laws, in the aforequoted Section 8, explicitly reserved unto the stockholders the power to determine the
compensation of members of the board of directors, and the stockholders did restrict such compensation to “actual
transportation expenses plus the per diems of P30.00 and actual expenses while waiting” Even without the express
reservation of said power, the directors are not entitled to compensation, for the law is well-settled that directors of
corporations presumptively served without compensation and in the absence of an express agreement or a resolution in
relation thereto, no claim can be asserted therefor.
DISSENTING/CONCURRING OPINION(S):