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Seventh Day Adventist

The document discusses a land donation made in 1971 to the South Philippine Union Mission of Seventh Day Adventist Church (SPUM-SDA) in Bayugan, Philippines. In 1980, the same land was sold to the Seventh Day Adventist Church of Northeastern Mindanao Mission (SDA-NEMM). In 1992, a trial court upheld the sale to SDA-NEMM. On appeal, the court affirmed but removed damages. The key issues are whether SDA-NEMM's ownership of the land should be upheld given that SPUM-SDA did not have legal personality or capacity to accept the donation when it was made in 1971 since it was not yet incorporated. The court ultimately upheld S

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791 views2 pages

Seventh Day Adventist

The document discusses a land donation made in 1971 to the South Philippine Union Mission of Seventh Day Adventist Church (SPUM-SDA) in Bayugan, Philippines. In 1980, the same land was sold to the Seventh Day Adventist Church of Northeastern Mindanao Mission (SDA-NEMM). In 1992, a trial court upheld the sale to SDA-NEMM. On appeal, the court affirmed but removed damages. The key issues are whether SDA-NEMM's ownership of the land should be upheld given that SPUM-SDA did not have legal personality or capacity to accept the donation when it was made in 1971 since it was not yet incorporated. The court ultimately upheld S

Uploaded by

Rea Nie
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Facts:

That we Felix Cosio

Felisa Cuysona... do hereby grant, convey and forever quit claim by way of Donation or gift unto the South Philippine [Union]
Mission of Seventh Day Adventist Church of Bayugan, Esperanza, Agusan, all the rights, title, interest, claim and demand both at
law and as well in... possession as in expectancy of in and to all the place of land and portion situated in the Barrio of Bayugan,
Municipality of Esperanza, Province of Agusan, Philippines

The donation was allegedly accepted by one Liberato Rayos, an elder of the Seventh Day Adventist Church, on behalf of the
donee.

Twenty-one years later, however, on February 28, 1980, the same parcel of land was sold by the spouses Cosio to the Seventh
Day Adventist Church of Northeastern Mindanao Mission (SDA-NEMM).

petitioners asserted ownership over the property. This was opposed by respondents who argued that at the time of the donation,
SPUM-SDA Bayugan could not legally be a donee because, not having been incorporated yet, it... had no juridical personality.

Neither were petitioners members of the local church then, hence, the donation could not have been made particularly to them.

tr

After trial, the trial court rendered a decision[7] on November 20, 1992 upholding the sale in favor of respondents.

On appeal, the CA affirmed the RTC decision but deleted the award of moral damages and attorney's fees.

Issues:

should SDA-NEMM's ownership of the lot covered by TCT No. 4468 be upheld?[9] We answer in the affirmative.

Ruling:

Donation is an act of liberality whereby a person disposes gratuitously of a thing or right in favor of another person who accepts
it. The donation could not have been made in favor of an entity yet inexistent at the time it was made. Nor could it have been
accepted... as there was yet no one to accept it.

The deed of donation was not in favor of any informal group of SDA members but a supposed SPUM-SDA Bayugan (the local
church) which, at the time, had neither juridical personality nor capacity to accept such gift.

Declaring themselves a de facto corporation, petitioners allege that they should benefit from the donation.

But there are stringent requirements before one can qualify as a de facto corporation:

(a) the existence of a valid law under which it may be incorporated;

(b) an attempt in good faith to incorporate; and

(c) assumption of corporate powers.

there is no proof that there was an attempt to incorporate at that time.

The filing of articles of incorporation and the issuance of the certificate of incorporation are essential for the existence of a de
facto corporation.

Petitioners themselves admitted that at the time of the donation, they were not registered with the SEC, nor did they even attempt
to... organize[14] to comply with legal requirements.

Corporate existence begins only from the moment a certificate of incorporation is issued. No such certificate was ever issued to
petitioners or their supposed predecessor-in-interest at the time of the donation. Petitioners obviously could not have claimed
succession to an... entity that never came to exist.

were not even members of the local church then, thus, they could not even claim that the donation was particularly for them.

Principles:

"The de facto doctrine thus effects a compromise between two conflicting public interest[s]-the one opposed to an unauthorized
assumption of corporate privileges; the other in favor of doing justice to the parties and of establishing a general assurance... of
security in business dealing with corporations."[17]
Generally, the doctrine exists to protect the public dealing with supposed corporate entities, not to favor the defective or non-
existent corporation.

When is the start and end of corporate existence? This issue was addressed by the Securities and Exchange Commission (SEC)
when it issued SEC Memorandum No. 21-2014, dated Nov. 28, 2014. The SEC memorandum provides guidelines in determining
the first and last day of corporate existence.

Under the SEC memorandum, the first day of the corporate term is the date of incorporation, as stated in the Certificate of
Incorporation. According to the SEC, the date of incorporation is the day when the existence of a corporation commences
pursuant to Section 19 of the Corporation Code and Section 31, Chapter VIII, Book I of the Administrative Code of 1987.

This rule is consistent with the Supreme Court’s pronouncement in Seventh Day Adventist Conference Church of Southern
Philippines Inc. versus Northeastern Mindanao Mission of Seventh Day Adventist Inc., G.R. No. 150416, July 21, 2006 that
corporate existence begins only from the moment a Certificate of Incorporation is issued.

Please note that the date of incorporation is the date written in the “In Witness Whereof” portion of the Certificate of
Incorporation issued by the Company Registration and Monitoring Department of the SEC, upon the incorporation of the
company.

Knowing the first day of corporate term is relevant as it only then that the incorporators, stockholders/members and their
successors is constituted as body politic and corporate under the name stated in the Articles of Incorporation for a period of time
mentioned therein, unless the period is extended, or the corporation is sooner dissolved in accordance with law (Section 19 of the
Corporation Code).

From the date of incorporation, the corporation continues to exist for a period not exceeding 50 years, unless the term is
shortened or extended. The corporate term can be found in the Articles of Incorporation (usually in the fourth provision), and the
same may be extended for periods not exceeding 50 years in any single instance by amendment of the articles of incorporation
(Section 11 of the Corporation Code). The corporate term may also be shortened by an amendment of the articles of
incorporation.

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