WESLEYAN UNIVERSITY-PHILIPPINES, 

v.  MAGLAYA, SR

Facts:

 WUP is a non-stock corporation

 Maglaya is a member of BOT and the President of the University
 The new Chairman if the Board (Palomo) informed Maglaya of the termination of his services
and authority as Pres.

Maglaya

 Maglaya then filed an illegal dismissal case against WUP in the LABOR ARBITER
 He claimed that he was unceremoniously dismissed on wanton, reckless, oppressive manner.

WUP

 WUP states that the dismissal/removal of Maglaya, BEING A CORPORATE OFFICER AND NOT A
REGULAR EMPLOYEE, is a corporate act or intra-corporate controversy UNDER THE
JURISDICTION OF THE RTC

Labor Arbiter

 Ruled in favor of WUP

 Dismissed the case for lack of jurisdiction
 Since, he was appointed as President of the University, Maglaya was a corporate officer and not
a mere employee. It involves intra-corporate dispute which is BEYOND the jurisdiction of the
Labor Tribunal. (Sec 24 of the RCCP: Immediately after the election, the directors of a
corporation must formally organize and elect: 1. President, who must be a director, 2. Treasurer,
must be resident, 3. Secretary , must be a citizen, 4. Other officers as provided in the By-laws)

National Labor Relation Commission

 The NLRC REVERSED AND SET ASIDE the decision of the LA.
 Ruling that the illegal dismissal case falls within the jurisdiction of the labor tribunals.
 It observed that the Board did not ELECT Maglaya, but merely appointed him.
 Although the position of the President of the University is a corporate office, the manner of
Maglaya's appointment, and his duties, salaries, and allowances point to his being an employee
and subordinate.
 The NLRC denied the motion for reconsideration filed by WUP. In a Resolution, the CA dismissed
the petition for certiorari  filed by WUP. The CA noted that the decision and resolution of the
NLRC became final and executory 

CA

 The CA noted that the decision and resolution of the NLRC became final and executory 

ISSUE:

1. Whether Maglaya is a corporate officer or a mere employee.

2. whether or not the NLRC has jurisdiction

SC:

 The SC defined Corporate officers" are those officers of the corporation who are given that
character by the Corporation Code or by the corporation's by-laws. There are three specific
officers whom a corporation must have under Section 25 of the Corporation Code. These are the
president, secretary and the treasurer. The number of officers is not limited to these three. A
corporation may have such other officers as may be provided for by its by-laws like, but not
limited to, the vice-president, cashier, auditor or general manager. The number of corporate
officers is thus limited by law and by the corporation's by-laws.
 The president, vice-president, secretary and treasurer are commonly regarded as the principal
or executive officers of a corporation, and they are usually designated as the officers of the
corporation. However, other officers are sometimes created by the charter or by-laws of a
corporation, or the board of directors may be empowered under the by-laws of a corporation to
create additional offices as may be necessary
 WUP presented its amended By-Laws

ARTICLE VI. BOARD OF TRUSTEES

Section 2.  Membership  (a) The Board of Trustees shall be composed of Ten (10) members of the
corporation from among themselves provided, that six (6) shall come from the Ministry and Laity of
the United Methodist [C]hurch in the Philippines, three (3) shall be non-Methodist, friends and
sympathizers of the Wesleyan University-Philippines and of the United Methodist Church, and one
(1) representative of the Wesleyan Alumni Association, as provided in section 1 (c), Article IV hereof,
and (b) provided further that the incumbent area bishop and the  President of the Wesleyan
University-Philippines shall be honorary members of the Board.

ARTICLE VIII. OFFICERS

Section 1.  Officers:   The officers of the Board of Trustees shall be:
(a) Chairman
(b) Vice-Chairman
(c) Secretary
(d) Treasurer

Section 6. The President of Wesleyan University-Philippines. The President of the University, who must be
an active member of the United Methodist Church in the Philippines at the time of his election shall be
in-charge of and be responsible for the administration of the University and other institutions of learning
that [m]ay hereafter be established by the corporation, and
 It is apparent from the By-laws of WUP that the president was one of the officers of the
corporation, and was an honorary member of the Board. He was appointed by the Board and
not by a managing officer of the corporation.
 We held that one who is included in the by-laws of a corporation in its roster of corporate
officers is an officer of said corporation and not a mere employee.
 The alleged "appointment" of Maglaya instead of "election" as provided by the by-laws neither
convert the president of university as a mere employee, nor amend its nature as a corporate
officer.
  A corporate officer's dismissal is always a corporate act, or an intra-corporate controversy which
arises between a stockholder and a corporation,
 Section 5 of Republic Act No. 8799, which provides that the regional trial courts exercise
exclusive jurisdiction over all controversies in the election or appointment of directors, trustees,
officers or managers of corporations, partnerships or associations, applies in the case at bar.
 WHEREFORE, the petition for review on certiorari filed by petitioner Wesleyan University-
Philippines is hereby GRANTED. 

MATLING INDUSTRIAL AND COMMERCIAL CORPORATION,  v.  COROS

This case reprises the jurisdictional conundrum of whether a complaint for illegal dismissal is cognizable
by the Labor Arbiter (LA) or by the Regional Trial Court (RTC). The determination of whether the
dismissed officer was a regular employee or a corporate officer unravels the conundrum. In the case of
the regular employee, the LA has jurisdiction; otherwise, the RTC exercises the legal authority to
adjudicate.

Facts:
 After Coros dismissal by Matling as its Vice President for Finance and Administration, the
respondent filed a complaint for illegal suspension and illegal dismissal against Matling in the
NLRC
 The petitioners moved to dismiss the complaint,  saying that the complaint is within the
jurisdiction of (SEC) due to the controversy being intra-corporate inasmuch as the respondent
was a member of Matlings Board of Directors aside from being its Vice-President for Finance
and Administration prior to his termination.
 The respondent opposed the petitioners motion to dismiss, insisting that his status as a member
of Matlings Board of Directors was doubtful, considering that he had not been formally elected
as such; that he did not own a single share of stock in Matling,

LABOR ARIBITER
 the LA granted the petitioners motion to dismiss
 ruling that the respondent was a corporate officer because he was the Vice President for
Finance and Administration and at the same time was a Member of the Board of Directors of
Matling; hence, his removal was a corporate act of Matling and the controversy resulting from
such removal was under the jurisdiction of the SEC
 The respondent appealed to the NLRC

NLRC
 the NLRC set aside the dismissal
 concluding that the respondents complaint for illegal dismissal was properly cognizable by the
LA, not by the SEC,
 because he was not a corporate officer by virtue of his position in Matling, albeit high ranking
and managerial, not being among the positions listed in Matlings By-Laws.
CA
  the CA dismissed the petition for certiorari by Matling
 Saying that, For a position to be considered as a corporate office, or, for that matter, for one to
be considered as a corporate officer, the position must, if not listed in the by-laws, have been
created by the corporation's board of directors, and the occupant thereof appointed or elected
by the same board of directors or stockholders
 The position of vice-president for administration and finance, was not created by the
corporations board of directors but only by its president or executive vice-president pursuant to
the by-laws of the corporation. 

ISSUE:
1. WON the respondent was a corporate officer of Matling

SC:
 No, the SC ruled in favor of the respondent.
  Section 25. Corporate officers, Immediately after their election, the directors of a corporation
must formally organize by the election of a president, who shall be a director, a treasurer who
may or may not be a director, a secretary who shall be a resident and citizen of the
Philippines, and such other officers as may be provided for in the by-laws.
 Conformably with Section 25, a position must be expressly mentioned in the By-Laws in order to
be considered as a corporate office. Thus, the creation of an office pursuant to or under a By-
Law enabling provision is not enough to make a position a corporate office.
 only officers of a corporation were those given that character either by the Corporation Code or
by the By-Laws; the rest of the corporate officers could be considered only as employees or
subordinate officials.
 An "office" is created by the charter of the corporation and the officer is elected by the directors
or stockholders.
 On the other hand, an employee occupies no office and generally is employed not by the action
of the directors or stockholders but by the managing officer of the corporation who also
determines the compensation to be paid to such employee
 In this case, respondent was appointed vice president for nationwide expansion by Malonzo,
petitioner's general manager, not by the board of directors of petitioner. It was also Malonzo
who determined the compensation package of respondent. Thus, respondent was an employee,
not a "corporate officer."  The CA was therefore correct in ruling that jurisdiction over the case
was properly with the NLRC, not the SEC (now the RTC).
 Thus, pursuant to the above provision (Section 25 of the Corporation Code), whoever are the
corporate officers enumerated in the by-laws are the exclusive Officers of the corporation and
the Board has no power to create other Offices without amending first the corporate By-
laws. However, the Board may create appointive positions other than the positions of
corporate Officers, but the persons occupying such positions are not considered as corporate
officers within the meaning of Section 25 of the Corporation Code  and are not empowered to
exercise the functions of the corporate Officers, except those functions lawfully delegated to
them. Their functions and duties are to be determined by the Board of Directors/Trustees.
 By-Law No. V merely allowed Matlings President to create non-corporate offices to be occupied
by ordinary employees of Matling. Such powers were incidental to the Presidents duties as the
executive head of Matling to assist him in the daily operations of the business.
 Moreover, the power to elect the corporate officers was a discretionary power that the law
exclusively vested in the Board of Directors, and could not be delegated to subordinate officers
or agents. The office of Vice President for Finance and Administration created by Matling’s
President pursuant to By Law No. V was an ordinary, not a corporate, office

(what is intra-corporate controversy? An intra-corporate controversy is one which arises between a

stockholder and the corporation)

 The SC affirmed the decision of the Court of Appeals, that jurisdiction regarding cases of illegal
dismissal of regular employees must be in the Labor Arbiter, and if the case concerns the
corporate officers, the jurisdiction should be in the RTC

CINCO VS BERNAS
Facts:
 Makati Sports Club (MSC) is a domestic corporationfor recreational activities.
 Jose A. Bernasand others are the incumbent members of the board of directors whose terms
will expire either in 1998 or in 1999.
 New election was held because the the MSC oversight committee were alarmed of rumors of
anomalies in handling corporate funds.
 Cinco and others are stockholders who were elected as members of the board of directors and
officers during the 1997 Special Stockholders Meeting called by the MSC Oversight Committee
Bernas
 Bernas group were aggrieved, hence they initiated an action with the SEC
 Bernas group argued that the authority to call a meeting lies with the secretary not with the
oversight committee. Citing Section 28 of the Corporation Code
Cinco
 Cinco Group insisted that the meeting was valid.
 they reasoned that Section 25 of the MSC by-laws merely authorized the
Corporate Secretary to issue notices of meetings and nowhere does it state that
such authority solely belongs to him
 and that it would be useless to call a meeting thru the Corporate Secretary
because he repeatedly refused to call a special stockholders meeting despite
demands and even filed a suit to restrain the holding of a special meeting.
 Cinco, as newly elected initiated an investigation and found that there were indeed anomalies
 The Bernas group shares were also authorized to be sold at public auction.

SICD
 that the 17 December 1997 Special Stockholders Meeting and the Annual
Stockholders Meeting conducted on 20 April 1998 and 19 April 1999 are invalid.
 The SICD likewise nullified the expulsion of Bernas from the corporation and the
sale of his share at the public auction.

SEC En banc
 reversed the findings of the SICD and validated the holding of the 17 December
1997 Special Stockholders Meeting as well as the Annual Stockholders Meeting
held on 1998 and 1999.
CA
 the Court of Appeals rendered a Decision declaring the 1997 Special
Stockholders Meeting invalid for being improperly called
 but affirmed the actions taken during the Annual Stockholders Meeting held in
1998, 1999 and 2000.
 both parties elevated the case before this Court
 While the Bernas Group agrees with the disquisition of the appellate court that
the Special Stockholders Meeting is invalid for being called by the persons not
authorized to do so, they urge the Court to likewise invalidate the holding of the
subsequent Annual Stockholders Meetings invoking the application of the
holdover principle.
 While The Cinco Group, insists that the holding of 17 December 1997 Special
Stockholders Meeting is valid and binding
ISSUE:
WHETHER OR NOT THE CA ERRED IN RULING THAT THE 1997 SPECIAL
STOCKHOLDERS MEETING IS INVALID; AND

WHETHER OR NOT THE CA ERRED IN FAILING TO NULLIFY THE HOLDING OF THE

ANNUAL STOCKHOLDERS MEETING ON 1998, 1999 AND 2000.

SC:
