Scribd Logo
Upload

Welcome to Scribd!

  • 170 views

    Manila Metal Container Corp v. PNB

    Uploaded by

    Maria Analyn
    This case involves a dispute over the repurchase of property between Manila Metal Container Corporation (MMCC) and Philippine National Bank (PNB) after MMCC defaulted on a loan. PNB's Special Assets Management Department (SAMD) stated MMCC's obligation was P1.6 million and accepted a P750,000 deposit from MMCC. However, PNB's Board of Directors only approved a repurchase for P1.9 million less the deposit. The Supreme Court ruled there was no valid contract for P1.6 million because SAMD was not authorized by PNB's Board to accept MMCC's offer. Acts of a corporation must be authorized by its Board of Directors or authorized corporate agent.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Manila Metal Container Corp v. PNB

    Uploaded by

    Maria Analyn
    170 views1 page
    This case involves a dispute over the repurchase of property between Manila Metal Container Corporation (MMCC) and Philippine National Bank (PNB) after MMCC defaulted on a loan. PNB's Special Assets Management Department (SAMD) stated MMCC's obligation was P1.6 million and accepted a P750,000 deposit from MMCC. However, PNB's Board of Directors only approved a repurchase for P1.9 million less the deposit. The Supreme Court ruled there was no valid contract for P1.6 million because SAMD was not authorized by PNB's Board to accept MMCC's offer. Acts of a corporation must be authorized by its Board of Directors or authorized corporate agent.

    Original Description:

    x

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    This case involves a dispute over the repurchase of property between Manila Metal Container Corporation (MMCC) and Philippine National Bank (PNB) after MMCC defaulted on a loan. PNB's Special Assets Management Department (SAMD) stated MMCC's obligation was P1.6 million and accepted a P750,000 deposit from MMCC. However, PNB's Board of Directors only approved a repurchase for P1.9 million less the deposit. The Supreme Court ruled there was no valid contract for P1.6 million because SAMD was not authorized by PNB's Board to accept MMCC's offer. Acts of a corporation must be authorized by its Board of Directors or authorized corporate agent.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    170 views1 page

    Manila Metal Container Corp v. PNB

    Uploaded by

    Maria Analyn
    This case involves a dispute over the repurchase of property between Manila Metal Container Corporation (MMCC) and Philippine National Bank (PNB) after MMCC defaulted on a loan. PNB's Special Assets Management Department (SAMD) stated MMCC's obligation was P1.6 million and accepted a P750,000 deposit from MMCC. However, PNB's Board of Directors only approved a repurchase for P1.9 million less the deposit. The Supreme Court ruled there was no valid contract for P1.6 million because SAMD was not authorized by PNB's Board to accept MMCC's offer. Acts of a corporation must be authorized by its Board of Directors or authorized corporate agent.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    University of the Philippines College of Law | Corporation Law | D2021

    Topic Corporate Powers > Ultra Vires Acts > Concept


    Case Name Manila Metal Container Corp. v. PNB
    Case No. & Date G.R. No. 166862, December 20, 2006
    Ponente Callejo, Sr., J.
    Petitioners MANILA METAL CONTAINER CORPORATION, petitioner,
    REYNALDO C. TOLENTINO, intervenor.
    Respondents PHILIPPINE NATIONAL BANK, respondent,
    DMCI-PROJECT DEVELOPERS, INC., intervenor.

    Summary (recit- Petitioner Manila Metal Container Corporation (MMCC) obtained a loan from respondent Philippine National
    friendly) Bank (PNB) for which the former executed a REM on a parcel of land as security. Upon MMCC’s failure to pay
    the loan, PNB moved for the extrajudicial foreclosure over the property; a public auction was held in which
    PNB was the winning bidder. MMCC requested PNB that it be given an extension of time to redeem or
    repurchase the land on installment basis. Meanwhile, PNB’s Special Assets Management Department (SAMD)
    prepared a statement of account to detail MMCC’s obligation to the amount of P1.6Mn for which it accepted
    a deposit of 750K. Later on, PNB’s BOD accepted MMCC’s offer to repurchase the property but for the
    amount of P1.9Mn, less the 750K deposit. MMCC rejected this latest offer, saying that PNB was already
    constrained to the purchase price of P1.6Mn as stated by SAMD. Ultimately, the Supreme Court held that
    there was no perfected contract of sale for the amount of P1.6Mn because there was no evidence that SAMD
    was authorized by PNB’s BOD to accept MMCC’s offer to redeem or repurchase the property.
    Doctrine/s The corporate powers of all corporations shall be exercised by the BOD. Just as a natural person may
    authorize another to do certain acts in his behalf, so may the BOD of a corporation validly delegate some of
    its functions to individual officers or agents appointed by it. Thus, contracts or acts of a corporation must be
    made either by the board of directors or by a corporate agent duly authorized by the board. Absent such valid
    delegation/authorization, the rule is that the declarations of an individual director relating to the affairs of
    the corporation, but not in the course of, or connected with the performance of authorized duties of such
    director, are held not binding on the corporation.

    Thus, a corporation can only execute its powers and transact its business through its BOD and through its
    officers and agents when authorized by a board resolution or its by-laws.

    RELEVANT FACTS

    ISSUE AND RATIO DECIDENDI

    RULING

    NOTES

    You might also like