Special Corpoations

SPECIAL CORPORATIONS

2 TYPES OF SPECIAL CORPORATIONS:
The special corporations provided for by law are educational and religious corporations.

Educational corporations – Educational corporations are stock or non-stock
corporations organized to provide facilities for teaching or instruction and are governed
by special laws and by general provisions of the code (Sec. 105, RCC).
Management of a stock educational corporation

A stock educational corporation shall be governed by the general provisions on
stock corporation
Management of a non-stock educational corporation
Section 106 provides that the board of trustees shall not be less than 5 nor more
than 15 but always in multiples of 5, so classified so that 1/5 of its members shall have
terms that expire every year and those subsequently elected shall serve for a term of
five years. Notwithstanding this provision, its articles and the by-laws may provide
otherwise.

Vacancies
Any vacancies are only filled up for the unexpired portion but if organized as a
stock corporation, the provisions applicable to stock corporations shall govern.
Quorum
For the conduct of its business, a majority of the board shall constitute a quorum
Religious corporations – Religious corporations are corporations incorporated by one

or more persons and are classified as either a corporation sole or religious society and
is to be governed by this chapter and generally by other provisions governing non-
stockcorporations (Sec. 1907, RCC).

Purpose: take charge of the temporalities of the church – the revenue or assets of the
church
NOTE: What makes these corporations as special corporations is the fact that they are
governed by a specfic chapter of the Revised Corporation Code. Insofar as Educational
Corporations, they can be incorporated as stock or non-stock. Insofar as religious
corporations, they can be incorporated as corporation sole or religious society.

Corporation sole – a Corporation Sole is one formed by the archbishop, bishop, priest,
minister, rabbi, or other presiding elder of a religious denomination sector church for the
purpose of administering and managing as trustee-the affairs, property and
temporalities or money revenues of such religious denomination, sect, or church (Sec.
108, RCC).

Section 109 requires the articles of incorporation to provide:
(a) that he is the archbishop bishop, priest, minister, rabbi or presiding elder;
(b) rules are not inconsistent with his becoming a corporation sole nor is it prohibited;
(c) that he is charged with the administration of its temporalities and the management of
its affairs within its territorial jurisdiction;
(d) the manner vacancies are filled;
(e) place where the principal office is located, which must be in the Philippines.

Once the articles are formulated and prepared, they are to be filed with th
Securities and Exchange Commission and, unlike other corporations, do not need to
wait for the issuance of a Ccertificate of Incorporation. Section 110 provides that
a corporation sole is deemed incorporated once the verified Articles are submitted to the
SEC together with an affidavit of affirmation. Henceforth, he becomes a corporation
sole.

Acquisition and alienation of property:
Section 111 provides that a corporation sole may purchase and hold real estate
and personal property for its church, charitable, benevolent, or educational purposes,
and may receive bequests or gifts for such purposes. Such corporation may sell or
mortgage real property held by it by obtaining an order for that purpose from the
Regional Trial Court of the province where the property is situated upon proof that the
notice of the application for leave to sell or mortgage has been made through
publication or as directed by the Court, and that it is in the interest of the corporation
that leave to sell or mortgage be granted. The application for leave to sell or mortgage
must be made by petition, duly verified, by the chief archbishop, bishop, priest, minister,
rabbi, or presiding elder acting as corporation sole, and may be opposed by any
member of the religious denomination, sect, or corporation sole: Provided, That in cases
where the rules, regulations and discipline of the religious denomination, sect or church,
religious society, or order concerned represented by such corporation sole regulate the
method of acquiring, holding, selling, an mortgaging real estate and personal property,
such rules, regulations and discipline shall govern, and the intervention of the courts
shall not be necessary.

Vacancies
Section 112 provides that vacancies can be filled by the filing with the SEC of his
commission or certificate of election or proof of assumption.
Dissolution
Section 113 provides that dissolution takes place by the filing with the SEC of a
verified declaration of dissolution setting forth:
(a) name;
(b) reason for dissolution;
(c) authorization for dissolution;
(d) name and address of the persons who will supervise dissolution or
winding up of its affairs.
Upon SEC approval, it ceases to carry on its operations.

Religious Society – a Religious Society under Section 114 is the same as a
corporation sole as far as purposes are concerned. Their difference is the manner on
which they are incorporated.
A religious society is incorporated by 2/3 vote or written consent of its members,
who then file its articles with the SEC, verified by affidavit of the presiding elder,
secretary, clerk or member stating that:
(a) that the society is a religious organization of some religious denomination,
sect or church;
(b) that 2/3 of its member have given their written consent or vote to incorporate
at a duly convened meeting of the body;
(c) that its incorporation is not forbidden by competent authority or by is
constitution, rules, regulations or discipline of the religious denomination, sect or church
to which it belongs;
(d) that its purpose is to manage or administer its affairs, properties or estate;
(e) location of its principal office ,which must be in the Philippines;
(f) names, nationalities and residences of the trustees elected to serve the first
year or such other period as prescribed, which board must not be less than 5 or more
than 15.
What is peculiar with a religious society is that the incoporators would be those
who are voting for its incorporation or has given written consent for its incorporation,
unlike other corporations where there is a specific requirement as to incoporators.

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SPECIAL CORPORATIONS

Management of a stock educational corporation

Management of a non-stock educational corporation

Religious corporations – Religious corporations are corporations incorporated by one

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