G.R. No. 178523 June 16, 2010
Lessons Applicable: Certificate of stock = merely tangible evidence of stock(Corporate Law)
FACTS:
- October 20, 1994: Makati Sports Club Inc (MSCI) BOD adopted a resolution authorizing the sale of 19 unissued shares at a floor price of P400,000 and P450,000 per share for Class A and B, respectively.
- Cheng was a Treasurer and Director of Makati Sports Club in 1995
- July 7, 1995: Hodreal expressed his interest to buy a share, for this purpose he sent the letter requesting to be wait listed
- November 1995: McFoods acquiried shares of Makati Sports Club at P1,800,000 through Urban Bank
- December 15, 1995: Stock cert. was issued to McFoods
- December 27, 1995: McFoods advised its offer to resell
- November 24, 1995: Hodreal paid McFoods P1,400,000
- December 27, 1995: Hodreal again paid P1,400,000
- February 7, 1996: Cheng advised sale by McFoods to Hodreal of the share evidenced by a certificate
- new certificate was issued
- 1997: investigation showed that Cheng profited from the transaction because of her knowledge
- MSCI sought judgment that would order respondents to pay the sum of P1,000,000.00, representing the amount allegedly defrauded, together with interest and damages
- CA affirmed RTC: dismissed
ISSUE: W/N MSCI was defrauded by Cheng's collaboration with Mc Foods
HELD: NO. petition is DENIED
- no evidence on record that the Membership Committee acted on Hodreal's letter
- SEC. 29. (a) The Membership Committee shall process applications for membership; ascertain that the requirements for stock ownership, including citizenship, are complied with; submit to the Board its recommended on applicants for inclusion in the Waiting List; take charge of auction sales of shares of stock; and exercise such other powers and perform such other functions as may be authorized by the Board.
- Membership Committee failed to question the alleged irregularities attending Mc Foods’ purchase
- purchase price of P1,800,000.00 is P1,400,000.00 more than the floor price - NOT detrimental
- Upon payment and the execution of the Deed of Absolute Sale, it had the right to demand the delivery of the stock certificate in its name.
- The right of a transferee to have stocks transferred to its name is an inherent right flowing from its ownership of the stocks
- certificate of stock
- paper representative or tangible evidence of the stock itself and of the various interests therein
- not a stock in the corporation but is merely evidence of the holder’s interest and status in the corporation, his ownership of the share represented thereby
- MSCI failed to repurchase Mc Foods’ Class "A" share within the 30 day pre-emptive period
- no proof that Cheng personally profited