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Corporate Law Case Digest: Lim Tong Lim v. Philippine Fishing Gear Industries (1999)

G.R. No. 136448    November 3, 1999
Lessons Applicable: Corporation by estoppel doctrine (Corporate Law)

  • Feb 7 1990: On behalf of "Ocean Quest Fishing Corp.", Antonio Chua and Peter Yao entered into a purchase of fishing nets of various sizes from Phil. Fishing Gear Industries Inc. (PFGI) claiming they were engaged in venture with Lim Tong Lim (NOT a signatory)
  • Buyers failed to pay
    • PFGI filed a suit against Chua, Yao and Lim w/ writ of preliminary attachment
  • Chua: Admitted liability and requested resonable time and turned over nets in his possession
  • Yao: Failre to appear in subsequent hearings
  • Lim: Counterclaim and Crossclaim to life writ of Attachment
  • CA affirmed RTC: Writ of Attachment & Chua, Yao and Lim as general partners
  • Chua, Yao and Lim had decided to engage in business w/ Lim's brother Jesus Lim as financer of a loan = common fund
  • Compromise Agreement:  pay loan w/ the proceeds of boats sale and to divide equally among them the excess or loss
ISSUE: W/N Doctrine of Estoppel can apply to Lim

HELD: YES. CA affirmed.
  • Although petitioner did not directly act on behalf of the corp., having reaped the benefits of the contract entered into by persons w/ whom he previously had an existing rel., he is deemed to be part of said assoc. and covered by the doctrine of estoppel