PHILIPPINE NUT INDUSTRY, INC. vs.

STANDARD BRANDS INCORPORATED and

TIBURCIO S. EVALLE as Director of Patents

G.R. No. L-23035 July 31, 1975

Facts:

Philippine Nut Industry Inc., a domestic corporation, obtained from the Patent Office on
August 10, 1961, a certificate covering the trademark "PHILIPPINE PLANTERS
CORDIAL PEANUTS," the label used on its product of salted peanuts.

On May 14, 1962, Standard Brands, a foreign corporation, filed a case with the Director
of Patent, asking for the cancellation of Philippine Nut's certificate of registration on the
ground that "the registrant was not entitled to register the mark at the time of its
application for registration thereof" for the reason that it (Standard Brands) is the owner
of the trademark "PLANTERS COCKTAIL PEANUTS" covered by Certificate of
Registration No. SR-172, issued by the Patent Office on July 28, 1958.

Thereafter, the Philippine Nut filed its answer invoking the special defense that its
registered label is not confusingly similar to that of Standard Brands as the latter
alleges.

Respondent Director of Patents gave due course to Standard Brand's petition, ordering
the cancellation of Philippine Nut's Certificate of Registration.

Upon denial of the motion for reconsideration, the Philippine Nut petitioned for a review,
seeking the reversal of the Director of Patents’ decision.

Issue:

Whether or not the trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS" used by

Philippine Nut on its label for salted peanuts with the same coloring scheme and the
same lay-out of words, confusingly similar to the trademark "PLANTERS COCKTAIL
PEANUTS" used by Standard Brands on its product.

Held:

Yes. As to appearance and general impression of the two trademarks, the Supreme
Court said it found a very confusing similarity.

The word PLANTERS printed across the upper portion of the label in bold letters easily
attracts and catches the eye of the ordinary consumer and it is that word and none other
that sticks in his mind when he thinks of salted peanuts.

The Supreme Court also held that although it is true that no producer or manufacturer
may have a monopoly of any color scheme or form of words in a label, but when a
competitor adopts a distinctive or dominant mark or feature of another's trademark and
with it makes use of the same color ensemble, employs similar words written in a style,
type and size of lettering almost identical with those found in the other trademark, the
intent to pass to the public his product as that of the other is quite obvious. It deceives
the public.

Findings of fact by the Director of Patents are conclusive and binding on this Court
provided they are supported by substantial evidence. 9 The testimonial and
documentary evidence in addition to the stipulation of facts submitted by the parties fully
support the findings of respondent Director that(1) there is a confusing similarity
between the labels or trademarks of Philippine Nut and Standard Brands used in their
respective canned salted peanuts; (2) respondent Standard Brands has priority of
adoption and use of the label with PLANTERS as the dominant feature and the same
has acquired secondary meaning in relation to salted peanuts; and (3) there has been
no abandonment or non-use of said trademark by Standard Brands which would justify
its adoption by petitioner or any other competitor for the sale of salted peanuts in the
market.

PREMISES CONSIDERED, We AFFIRM the decision of respondent Director of Patents

with costs against petitioner.

Universal Mills Corporation vs. Universal Textile Mills

G.R. No. L-28351 July 28, 1977

Facts:

This is an appeal from the order of the Securities and Exchange Commission granting a
petition by the respondent to have the petitioner’s corporate name be changed as it is
“confusingly and deceptively similar” to that of the former.

On January 8, 1954, respondent Universal Textile Mills was issued a certificate of

Corporation as a textile manufacturing firm. On the other hand, petitioner, which deals in
the production of hosieries and apparels, acquired its current name by amending its
articles of incorporation, changing its name from Universal Hosiery Mills Corporation to
Universal Mills corporation.

Issue:

Whether or not petitioner’s trade name is confusingly similar with that of respondent’s.

Held:

The corporate names in question are not Identical, but they are indisputably so similar
that even under the test of "reasonable care and observation as the public generally are
capable of using and may be expected to exercise" invoked by appellant, We are
apprehensive confusion will usually arise, considering that under the second
amendment of its articles of incorporation on August 14, 1964, appellant included
among its primary purposes the "manufacturing, dyeing, finishing and selling of fabrics
of all kinds" in which respondent had been engaged for more than a decade ahead of
petitioner. Factually, the Commission found existence of such confusion, and there is
evidence to support its conclusion. Since respondent is not claiming damages in this
proceeding, it is, of course, immaterial whether or not appellant has acted in good faith,
but We cannot perceive why of all names, it had to choose a name already being used
by another firm engaged in practically the same business for more than a decade
enjoying well-earned patronage and goodwill, when there are so many other appropriate
names it could possibly adopt without arousing any suspicion as to its motive and, more
importantly, any degree of confusion in the mind of the public which could mislead even
its own customers, existing or prospective. Premises considered, there is no warrant for
our interference.

As this is purely a case of injunction, and considering the time that has elapsed since
the facts complained of took place, this decision should not be deemed as foreclosing
any further remedy which appellee may have for the protection of its interests.

WHEREFORE, with the reservation already mentioned, the appealed decision is

affirmed. Costs against petitioners.

Lyceum of the Philippines, Inc. vs. Court of Appeals, et al.

G.R. No. 101897. March 5, 1993

Facts:
Lyceum of the Philippines Inc. had sometime before commenced in the SEC a
proceeding (SEC-Case No. 1241) against the Lyceum of Baguio, Inc. to require it to
change its corporate name and to adopt another name not "similar [to] or identical" with
that of petitioner. In an Order dated 20 April 1977, Associate Commissioner Julio Sulit
held that the corporate name of petitioner and that of the Lyceum of Baguio, Inc. were
substantially identical because of the presence of a "dominant" word, i.e., "Lyceum," the
name of the geographical location of the campus being the only word which distinguished
one from the other corporate name. The SEC also noted that Lyceum of the Philippines
Inc. had registered as a corporation ahead of the Lyceum of Baguio, Inc. in point of time,
and ordered the latter to change its name to another name "not similar or identical [with]"
the names of previously registered entities. The Lyceum of Baguio, Inc. assailed the
Order of the SEC before the Supreme Court (GR L-46595). In a Minute Resolution dated
14 September 1977, the Court denied the Petition for Review for lack of merit. Entry of
judgment in that case was made on 21 October 1977.

Armed with the Resolution of the Supreme Court, the Lyceum of the Philippines
then wrote all the educational institutions it could find using the word "Lyceum" as part of
their corporate name, and advised them to discontinue such use of "Lyceum." When, with
the passage of time, it became clear that this recourse had failed, and on 24 February
1984, Lyceum of the Philippines instituted before the SEC SEC-Case 2579 to enforce
what Lyceum of the Philippines claims as its proprietary right to the word "Lyceum." The
SEC hearing officer rendered a decision sustaining petitioner's claim to an exclusive right
to use the word "Lyceum." The hearing officer relied upon the SEC ruling in the Lyceum
of Baguio, Inc. case (SEC-Case 1241) and held that the word "Lyceum" was capable of
appropriation and that petitioner had acquired an enforceable exclusive right to the use
of that word. On appeal, however, by Lyceum Of Aparri, Lyceum Of Cabagan, Lyceum
Of Camalaniugan, Inc., Lyceum Of Lallo, Inc., Lyceum Of Tuao, Inc., Buhi Lyceum,
Central Lyceum Of Catanduanes, Lyceum Of Southern Philippines, Lyceum Of Eastern
Mindanao, Inc. and Western Pangasinan Lyceum, Inc.,, which are also educational
institutions, to the SEC En Banc, the decision of the hearing officer was reversed and set
aside. The SEC En Banc did not consider the word "Lyceum" to have become so identified
with Lyceum of the Philippines as to render use thereof by other institutions as productive
of confusion about the identity of the schools concerned in the mind of the general public.
Unlike its hearing officer, the SEC En Banc held that the attaching of geographical names
to the word "Lyceum" served sufficiently to distinguish the schools from one another,
especially in view of the fact that the campuses of Lyceum of the Philippines and those
of the other Lyceums were physically quite remote from each other. Lyceum of the
Philippines then went on appeal to the Court of Appeals. In its Decision dated 28 June
1991, however, the Court of Appeals affirmed the questioned Orders of the SEC En Banc.
Lyceum of the Philippines filed a motion for reconsideration, without success. Lyceum of
the Philippines filed the petition for review.

Issue:
1.Whether the names of the contending Lyceum schools are confusingly similar.

2. Whether the use by the Lyceum of the Philippines of "Lyceum" in its corporate name
has been for such length of time and with such exclusivity as to have become associated
or identified with the petitioner institution in the mind of the general public (or at least that
portion of the general public which has to do with schools).

Held:

1. The Articles of Incorporation of a corporation must, among other things, set out the
name of the corporation. Section 18 of the Corporation Code establishes a restrictive rule
insofar as corporate names are concerned. It provides that "No corporate name may be
allowed by the Securities an Exchange Commission if the proposed name is identical or
deceptively or confusingly similar to that of any existing corporation or to any other name
already protected by law or is patently deceptive, confusing or contrary to existing laws.
When a change in the corporate name is approved, the Commission shall issue an
amended certificate of incorporation under the amended name." The policy underlying
the prohibition in Section 18 against the registration of a corporate name which is
"identical or deceptively or confusingly similar" to that of any existing corporation or which
is "patently deceptive" or "patently confusing" or "contrary to existing laws," is the
avoidance of fraud upon the public which would have occasion to deal with the entity
concerned, the evasion of legal obligations and duties, and the reduction of difficulties of
administration and supervision over corporations. Herein, the Court does not consider
that the corporate names of the academic institutions are "identical with, or deceptively
or confusingly similar" to that of Lyceum of the Philippines Inc.. True enough, the
corporate names of the other schools (defendant institutions) entities all carry the word
"Lyceum" but confusion and deception are effectively precluded by the appending of
geographic names to the word "Lyceum." Thus, the "Lyceum of Aparri" cannot be
mistaken by the general public for the Lyceum of the Philippines, or that the "Lyceum of
Camalaniugan" would be confused with the Lyceum of the Philippines. Further,
etymologically, the word "Lyceum" is the Latin word for the Greek lykeion which in turn
referred to a locality on the river Ilissius in ancient Athens "comprising an enclosure
dedicated to Apollo and adorned with fountains and buildings erected by Pisistratus,
Pericles and Lycurgus frequented by the youth for exercise and by the philosopher
Aristotle and his followers for teaching." In time, the word "Lyceum" became associated
with schools and other institutions providing public lectures and concerts and public
discussions. Thus today, the word "Lyceum" generally refers to a school or an institution
of learning. Since "Lyceum" or "Liceo" denotes a school or institution of learning, it is not
unnatural to use this word to designate an entity which is organized and operating as an
educational institution. To determine whether a given corporate name is "identical" or
"confusingly or deceptively similar" with another entity's corporate name, it is not enough
to ascertain the presence of "Lyceum" or "Liceo" in both names. One must evaluate
corporate names in their entirety and when the name of Lyceum of the Philippines is
juxtaposed with the names of private respondents, they are not reasonably regarded as
"identical" or "confusingly or deceptively similar" with each other.

2. The number alone of the private respondents in the present case suggests strongly
that the Lyceum of the Philippines' use of the word "Lyceum" has not been attended with
the exclusivity essential for applicability of the doctrine of secondary meaning. It may be
noted also that at least one of the private respondents, i.e., the Western Pangasinan
Lyceum, Inc., used the term "Lyceum" 17 years before Lyceum of the Philippines
registered its own corporate name with the SEC and began using the word "Lyceum." It
follows that if any institution had acquired an exclusive right to the word "Lyceum," that
institution would have been the Western Pangasinan Lyceum, Inc. rather than Lyceum of
the Philippines. Hence, Lyceum of the Philippines is not entitled to a legally enforceable
exclusive right to use the word "Lyceum" in its corporate name and that other institutions
may use "Lyceum" as part of their corporate names.
 Mariano A. Albert vs. University Publishing Co., Inc.
G.R. No. L-19118 January 30, 1965

Facts:

The University Publishing Co. Inc. through its President Jose Aruego entered
into a contract with Mariano Albert whereby the corporation agreed to pay a certain
sum in installments for the exclusive right to publish his revised commentaries in the
RPC and for his share in the previous sale of the book’s first edit edition. The
corporation failed to pay the second installment thereby making the whole amount due
and demandable (i.e. there was an acceleration clause). Albert then sued the corporation.

The lower court rendered judgment in favor of Albert and a writ of execution was
issued against the corporation. Albert however, petitioned for a writ of execution against
Aruego, as the real defendant, stating that there is no such entity as University
Publishing Co. Inc. Albert annexed to his petition a certification from the SEC saying
that their records contain no such registered corporation.

The corporation countered by saying that Aruego is not a party to this case
and that, therefore, Albert’s petition should be denied. The corporation countered by
saying that Aruego is not a party to this case, and that therefore, Albert’s petition
should be denied. The corporation, actually did not want Aruego to be declared a party
to the present case is because there would be no need to institute a separate action
against Aruego to be declared a party to the present case is because there would
then be a need to institute a separate action against Aruego; and if this is done, Aruego
can set up the defense of prescription under the Statute of Limitations.

Issue:

Whether or not the non-registration of University Publishing Co., Inc. in the SEC is an
existing corporation with an independent juridical personality.

Held:

On account of the non-registration it cannot be considered a corporation, not

even a corporation de facto (Hall vs. Piccio, 86 Phil. 603). It has therefore no personality
separate from Jose M. Aruego; it cannot be sued independently.

In the case at bar, Aruego represented a non-existent entity and induced not only
Albert but the court to believe in such representation. He signed the contract as
“President” of “University Publishing Co., Inc.,” stating that this was “a corporation duly
organized and existing under the laws of the Philippines”.
 “A person acting or purporting to act on behalf of a corporation which has no
valid existence assumes such privileges and obligations and becomes personally liable
for contracts entered into or for other acts performed as such agent.”

Aruego, acting as representative of such non-existent principal, was the real

party to the contract sued upon, and thus assumed such privileges and obligations and
became personally liable for the contract entered into or for other acts performed as
such agent.

The Supreme Court likewise held that the doctrine of corporation by estoppel
cannot be set up against Albert since it was Aruego who had induced him to act upon
his (Aruego’s) willful representation that University had been duly organized and was
existing under the law.

We need hardly state that should there be persons who under the law are liable to
Aruego for reimbursement or contribution with respect to the payment he makes under
the judgment in question, he may, of course, proceed against them through proper
remedial measures.

PREMISES CONSIDERED, the order appealed from is hereby set aside and the
case remanded ordering the lower court to hold supplementary proceedings for the
purpose of carrying the judgment into effect against University Publishing Co., Inc. and/or
Jose M. Aruego. So ordered.

Lim Tong Lim vs. Philippine Fishing Gear Industries, Inc.

G.R. No. 136448 November 3, 1999

Facts:
Lim Tong Lim requested Peter Yao and Antonio Chuato engage in commercial
fishing with him. The three agreed to purchase two fishing boats but since they do not
have the money they borrowed from one Jesus Lim the brother of Lim Tong Lim.
Subsequently, they again borrowed money for the purchase of fishing nets and other
fishing equipments. Yao and Chua represented themselves as acting in behalf of “Ocean
Quest Fishing Corporation” (OQFC) and they contracted with Philippine Fishing Gear
Industries (PFGI) for the purchase of fishing nets amounting to more than P500k.
However, they were unable to pay PFGI and hence were sued in their own names as
Ocean Quest Fishing Corporation is a non-existent corporation. Chua admitted his liability
while Lim Tong Lim refused such liability alleging that Chua and Yao acted without his
knowledge and consent in representing themselves as a corporation.
Issues:
1. Whether or not Lim Tong Lim is liable as a partner.
2. Whether or not Doctrine of Estoppel can apply to Lim.

Held:
1. Yes. From the factual findings of both lower courts, it is clear that Chua, Yao and Lim
had decided to engage in a fishing business, which they started by buying boats worth
P3.35 million, financed by a loan secured from Jesus Lim. In their Compromise
Agreement, they subsequently revealed their intention to pay the loan with the proceeds
of the sale of the boats, and to divide equally among them the excess or loss. These
boats, the purchase and the repair of which were financed with borrowed money, fell
under the term “common fund” under Article 1767. The contribution to such fund need not
be cash or fixed assets; it could be an intangible like credit or industry. That the parties
agreed that any loss or profit from the sale and operation of the boats would be divided
equally among them also shows that they had indeed formed a partnership.
2. Petitioner argues that under the doctrine of corporation by estoppel, liability can be
imputed only to Chua and Yao, and not to him. Again, we disagree. The doctrine of
corporation by estoppel may apply to the alleged corporation and to a third party. In the
first instance, an unincorporated association, which represented itself to be a corporation,
will be estopped from denying its corporate capacity in a suit against it by a third person
who relied in good faith on such representation. It cannot allege lack of personality to be
sued to evade its responsibility for a contract it entered into and by virtue of which it
received advantages and benefits.
There is no dispute that the respondent, Philippine Fishing Gear Industries, is entitled to
be paid for the nets it sold. The only question here is whether petitioner should be held
jointly 18 liable with Chua and Yao. Petitioner contests such liability, insisting that only
those who dealt in the name of the ostensible corporation should be held liable. Since his
name does not appear on any of the contracts and since he never directly transacted with
the respondent corporation, ergo, he cannot be held liable. Clearly, under the law on
estoppel, those acting on behalf of a corporation and those benefited by it, knowing it to
be without valid existence, are held liable as general partners.