Scribd
Upload
447 views1 page

People V Quasha

William Quasha was found guilty of falsifying documents to make it appear that a Filipino citizen owned 60% of shares in an airline corporation, when in fact the money belonged to an American citizen in an attempt to circumvent the constitutional requirement that Filipinos own at least 60% of any public utility corporation. The Supreme Court ruled that (1) it is not necessary for a corporation to have 60% Filipino ownership from the start in order to operate a public utility, (2) ownership can be attained after incorporation through share transfers, and (3) the determining factor is if the 60% requirement is met when applying for the franchise/authorization, not during incorporation.

Uploaded by

Alex
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
447 views1 page

People V Quasha

William Quasha was found guilty of falsifying documents to make it appear that a Filipino citizen owned 60% of shares in an airline corporation, when in fact the money belonged to an American citizen in an attempt to circumvent the constitutional requirement that Filipinos own at least 60% of any public utility corporation. The Supreme Court ruled that (1) it is not necessary for a corporation to have 60% Filipino ownership from the start in order to operate a public utility, (2) ownership can be attained after incorporation through share transfers, and (3) the determining factor is if the 60% requirement is met when applying for the franchise/authorization, not during incorporation.

Uploaded by

Alex
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
  • Case Analysis: People v. Guasha (1953)

People v.

Quasha (1953)
G.R. No. L-6055            
June 12, 1953
FACTS: William H. Quasha is a member of the Philippine bar, committed a crime of
falsification of a public and commercial document for causing it to appear that Arsenio
Baylon, a Filipino citizen, had subscribed to and was the owner of 60.005 % of the
subscribed capital stock of Pacific Airways Corp. (Pacific) when in reality the money
paid belongs to an American citizen whose name did not appear in the article of
incorporation, to circumvent the constitutional mandate that no corp. shall be authorize
to operate as a public utility in the Philippines unless 60% of its capital stock is owned
by Filipinos. He was found guilty after trial and sentenced to a term of imprisonment and
a fine. Quasha appealed to this Court because he said that the primary purpose was to
carry on the business of a common carrier by air, land or water. Baylon did not have the
controlling vote because of the difference in voting power between the preferred shares
and the common shares
ISSUE: Whether or not a corporation to be entitled to operate a public utility is it
necessary that it be organized with 60 per cent of its capital owned by Filipinos from the
start.
HELD: No. For a corporation to be entitled to operate a public utility it is not necessary
that it be organized with 60 per cent of its capital owned by Filipinos from the start. A
corporation formed with capital that is entirely alien may subsequently change the
nationality of its capital through transfer of shares to Filipino citizens. Conversely, a
corporation originally formed with Filipino capital may subsequently change the national
status of said capital through transfer of shares to foreigners. What need is there then
for a corporation that intends to operate a public utility to have, at the time of its
formation, 60 per cent of its capital owned by Filipinos alone? That condition may
anytime be attained thru the necessary transfer of stocks. The moment for determining
whether a corporation is entitled to operate as a public utility is when it applies for a
franchise, certificate, or any other form of authorization for that purpose. And that can
be done after the corporation has already come into being and not while it is still being
formed. And at that moment, the corporation must show that it has complied not only
with the requirement of the Constitution as to the nationality of its capital, but also with
the requirements of the Civil Aviation Law if it is a common carrier by air, the Revised
Administrative Code if it is a common carrier by water, and the Public Service Law if it is
a common carrier by land or other kind of public service.
Doctrine: No franchise, certificate, or any other form of authorization for the operation
of a public utility shall be granted except to citizens of the Philippines or to corporations
or associations organized under the laws of the Philippines, at least sixty per centum of
whose capital is owned by such citizens, nor shall such franchise, certificate or
authorization be exclusive in character for a longer period than fifty years.

You might also like