Laureano Investment v. CA

G.R. No.
100468 May 6, 1997
LAUREANO INVESTMENT & DEVELOPMENT CORPORATION, Petitioner, v. THE

HONORABLE COURT OF APPEALS and BORMAHECO, INC., Respondents.
PANGANIBAN, J.:
FACTS
Spouses Laureano are majority stockholders of petitioner Corporation and have series of loan
and credit transactions with Philippine National Cooperative Bank (PNCB). They executed
Deeds of Real Estate Mortgage to secure the payment of loans. Upon failure to pay the loans,
PNCB applied for judicial foreclosure of the real estate mortgages. The bank was the purchaser
of the properties and title thereof were consolidated in PNCB’s name. PNCB did not secure a
writ of possession nor did it file ejectment proceedings against the Laureano spouses because
there were pending cases involving the titles of ownership of subject two lots situated at Bel-Air
Subdivision, Makati.
Private respondent Bormaheco, Inc. become the successor of the obligations and liabilities of
PNCB over subject lots by virtue of a Deed of Sale/Assignment wherein Bormaheco bought
from PNCB titled and untitled properties including two parcels of land in question which are
formerly registered under the name of Laureano spouses. Bormaheco secured titles over the
subject lands; thereafter, filed an Ex-Parte Petition for the issuance of writ of Possession of Lot
4 and 5, Block 4 situated at Bel-Air Village, Makati. Petitioner Corporation filed its Motion for
Intervention and to Admit Complaint in Intervention.
CA issued an order stating that the herein intervenor LIDECO CORPORATION has an interest
which would eventually and adversely be affected in whatever decision the Court may render;
hence, granted the Motion.
Respondent Bormaheco filed its Motion to Strike out the Complaint in Intervention and all
related pleadings filed by LIDECO Corporation.
The motion to Strike was granted. Intervening in the instant petition, with the use of the name
LIDECO Corporation, the latter, in effect, represents to this court that it is a corporation whose
personality is distinct and separate from its stockholders and/or any other corporation bearing
different names. Hence, herein intervenor LIDECO Corporation and LAUREANO INVESTMENT
AND DEVELOPMENT CORPORATION, to the mind of this Court, are two (2) separate and
distinct entities.Inasmuch as the documents in support of its complaint in intervention - tax
declarations - are in the names of Laureano Investment and Development Corporation, and it
appearing that LIDECO Corporation is not a corporation or partnership duly organized and
registered with the SEC, there is, therefore, no way whatsoever that LIDECO Corporation's
interests will be adversely affected by the outcome of the instant case. Thus, intervenor lacks
personality to intervene.
ISSUE
May a plaintiff/petitioner which purports to be a corporation validly bring suit under a name other
than that registered with the Securities and Exchange Commission?
HELD
No. The records of the case would show that the motion of Bormaheco being adverted to indeed
made use LIDECO as an acronym for Laureano Investment and Development Corporation. But
said motion distinctly specified that LIDECO was the shorter term for Laureano Investment and
Development Corporation. It is obvious that no false representation or concealment can be
attributed to private respondent. Neither can it be charged with conveying the impression that
the facts are other than, or inconsistent with, those which it now asserts since LIDECO, as an
acronym, is clearly different from Lideco Corporation which represented itself as a corporation
duly registered and organized in accordance with law. Nor can it be logically inferred that
petitioner relied or acted upon such representation of private respondent in thereafter referring
to itself as Lideco Corporation; for petitioner is presumed to know by which name it is registered,
and the legal provisions on the use of its corporate name.
Section 1, Rule 3 of the Rules of Court provides that only natural or juridical persons or entities
authorized by law may be parties to a civil action. Under the Civil Code, a corporation has a
legal personality of its own (Article 44), and may sue or be sued in its name, in conformity with
the laws and regulations of its organization (Article 46). Additionally, Article 36 of the
Corporation Code similarly provides:
Article 36. Corporate powers and capacity. -- Every corporation incorporated under
this Code has the power and capacity:
1. To sue and be sued in its corporate name;
xxx
Lideco Corporation had no personality to intervene since it had not been duly registered as a
corporation. If petitioner legally and truly wanted to intervene, it should have used its corporate
name as the law requires and not another name which it had not registered. Indeed, as the
Respondent Court found, nowhere in the motion for intervention and complaint in intervention
does it appear that Lideco Corporation stands for Laureano Investment and Development
Corporation. Bormaheco, Inc., thus, was not estopped from questioning the juridical personality
of Lideco Corporation, even after the trial court had allowed it to intervene in the case.

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G.R. No.

100468 May 6, 1997

LAUREANO INVESTMENT & DEVELOPMENT CORPORATION, Petitioner, v. THE

1. To sue and be sued in its corporate name;

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