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Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE:
Under Section 4 of MPMCC’s By-Laws, corporations may designate a representative to act in all matters related to the corporation, including service of notice of assessments and meetings, grants of proxies, voting on any matter, and the like.
On October 16, 2018, Medical Plaza Makati Condominium Corporation (MPMCC) held its 20th annual meeting, which included the election of new board members. Pastorfide presided over the meeting as Chairman and announced an official slate of seven candidates, including himself, Monteblanco, Matibag, and Angeles (collectively, Pastorfide, et al.).
Objections were raised regarding their qualifications, as MPMCC’s By-Laws require board members to be members of the corporation. Only registered owners of MPMC condominium units are considered members.
It was later confirmed that Pastorfide, et al. were not registered owners but representatives of member-corporations that owned units in MPMCC. Specifically, Pastorfide, Monteblanco, and Angeles represented Pastorfide Land Corporation, while Matibag represented Maxicare Health Corporation. These corporations were members of MPMCC in good standing, with no outstanding dues or assessments.
Pastorfide, et al. asserted their eligibility to be elected to the Board on the ground that they were duly authorized representatives of corporate unit owners.
The head of the Election Committee noted that with only seven (7) candidates for seven (7) seats, there was no need for a formal election. Accordingly, all seven, including Pastorfide, et al., were declared elected to the Board of Directors for the ensuing year.
Aggrieved, Rodriguez, a registered unit owner and MPMCC member, subsequently filed a Complaint for Election Contest and Damages before the Regional Trial Court (RTC) on October 30, 2018, challenging the election of Pastorfide, et al.
The RTC, citing Lim v. Moldex Land, Inc., ruled that although MPMCC’s By-Laws allow representation, representatives are not eligible for election as directors unless they are members in their own right. In contrast, the Court of Appeals (CA) dismissed the complaint, holding that the RTC misapplied Lim, which involved proxies authorized by a corporation. The CA distinguished the present case, finding that Pastorfide, et al. were not proxies but designated, authorized representatives of member-corporations.
Therefore, did the CA err in ultimately dismissing Rodriguez’s Complaint for election contest?
The Supreme Court’s Decision
No, the CA did not err. Pastorfide, et al. were duly designated authorized representatives of corporations that owned condominium units in MPMC and were members of MPMCC in good standing. As such, they were authorized to exercise all rights of membership, including the right to be voted for and to sit as members of the Board.
Under Section 4 of MPMCC’s By-Laws, corporations may designate a representative to act in all matters related to the corporation, including service of notice of assessments and meetings, grants of proxies, voting on any matter, and the like.
Rodriguez does not dispute that the corporations represented by Pastorfide, et al. are bona fide unit owners and members of MPMCC. As such, they are entitled to be elected to the board, in accordance with Section 13 of the By-Laws, which provides that the Board shall be composed of seven (7) members “elected by and from among the members of the corporation who are not delinquent in their dues and assessments.”
The law requires that trustees or directors of a non-stock corporation must be members. In the case of juridical entities, this membership is exercised through natural persons who are authorized to represent them. Since corporations cannot physically sit on the Board, they must act through representatives. Therefore, the representatives of corporate members are not acting in their personal capacity but as the juridical extension of the corporate member itself.
The member-corporations are deemed the actual members sitting on the Board, and their designated representatives merely act on their behalf.
Thus, the Court of Appeals correctly ruled that Pastorfide, et al. were qualified to be elected as members of the Board. The RTC erred in applying Lim v. Moldex Land, Inc., which involved proxies, and not authorized representatives of corporate members. Accordingly, Rodriguez’s complaint was rightly dismissed.
Case:
Peter Rico F. Rodriguez vs. Gregorio Pastorfide, et. al.
G.R. No. 256648 | February 24, 2025
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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding legal services, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/ 0917-5772207/ 09778050020.
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