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National Abaca Corp. Legal Capacity Ruling

National Abaca filed a collection suit against Apolonia Pore. When the lower court rendered judgment for Pore, National appealed. Pore argues that National has no legal capacity to sue because it was abolished by an Executive Order three years prior. National argued it had three years from the date of abolition to file suits. The Supreme Court ruled that after the three year period expires, National can no longer proceed with the case even if it was instituted within the period. In the absence of statutory provisions stating otherwise, pending actions by or against a corporation are abated upon expiration of the period allowed for liquidation of its affairs.

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286 views2 pages

National Abaca Corp. Legal Capacity Ruling

National Abaca filed a collection suit against Apolonia Pore. When the lower court rendered judgment for Pore, National appealed. Pore argues that National has no legal capacity to sue because it was abolished by an Executive Order three years prior. National argued it had three years from the date of abolition to file suits. The Supreme Court ruled that after the three year period expires, National can no longer proceed with the case even if it was instituted within the period. In the absence of statutory provisions stating otherwise, pending actions by or against a corporation are abated upon expiration of the period allowed for liquidation of its affairs.

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Ylmir_1989
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd

CORPORATION LAW |

CASE DIGESTS
NATIONAL ABACA AND
OTHER FIBERS
CORPORATION vs. APOLONIA
PORE
August 16, 1961
Concepcion, J.
SUMMARY: National Abaca filed a collection suit against Pore.
When the lower court rendered a judgment, National filed an
appeal. Pore argues that National has no legal capacity to sue
because it was already abolished by E0 3!. National argued that
the E0 ga"e it 3 yrs within which it can file suits. #he $% that after
the e&piration of the 3'yr period, National can no longer proceed
with the case e"en if it was instituted within the period.
DOCTRINE: In the absence of statutory provision to the contrary,
pending actions by or against a corporation are abated upon expiration of
the period allowed by law for the liquidation of its affairs
FACTS:
- In a collection suit filed by National Abaca against Pore, the
former insisted that Pore was not able to account for the cash
advances it gave for the purchase of hemp.
- he !"I ruled and National tried to appeal #udgment. Pore filed an
$% to this on the ground that&
o plaintiff has no legal capacity to sue, it having abolished
by 'xecutive (rder No. )*+ of the President of the
Philippines, dated November +,,-./0
- National responded and stated that
o It shall nevertheless be continued as a body corporate for
a period of three 1)2 years from the effective date3 of said
executive order, which was November )0, -./0, 3for the
purpose of prosecuting and defending suits by or against it
and of enabling the 4oard of 5iquidators3 6 thereby
created 6 3gradually to settle and close its affairs3, . . .
and that this case was begun on November -,, -./), or
before the expiration of the period aforementioned
ISSUE:
whether an action, commenced within three 1)2 years after the abolition of
plaintiff, as a corporation, may be continued by the same after the expiration
of said period - N(
RATIO:
- In the absence of statutory provision to the contrary, pending
actions by or against a corporation are abated upon expiration of
the period allowed by law for the liquidation of its affairs.
- (ur !orporation 5aw contains no provision authori7ing a
corporation, after three 1)2 years from the expiration of its lifetime,
to continue in its corporate name actions instituted by it within said
period of three 1)2 years.
o in fact, section ** of said law provides that the
corporation shall 3be continued as a body corporate for
three 1)2 years after the time when it would have been . . .
dissolved, for the purposed of prosecuting and defending
suits by or against it . . .3, so that, thereafter, it shall no
longer en#oy corporate existence for such purpose.
o "or this reason, section *8 of the same law authori7es the
corporation, 3at any time during said three years . . . to
convey all of its property to trustees for the benefit of
members, stoc9holders, creditors and other interested3,
CORPORATION LAW |
CASE DIGESTS
evidently for the purpose, among others, of enabling said
trustees to prosecute and defend suits by or against the
corporation begun before the expiration of said period.
- (bviously, the complete loss of plaintiff:s corporate existence after
the expiration of the period of three 1)2 years for the settlement of
its affairs is what impelled the President to create a 4oard of
5iquidators, to continue the management of such matters as may
then be pending.
DISPOSITIVE

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