SUBJECT: REVISED CORPORATION CODE OF THE PHILIPPINES

1.ABC Corp. is engaged in the manufacture of computer accessories, and rents an office and store space in a building owned by X. Since it is a start-up company, ABC enjoyed some leniency in rent payments; but after three years of operation, X put a stop to it and asked ABC's President, Y, to pay back rentals amounting to Php100,000.00 or to vacate the premises at the end of the month. ABC neither paid its debt nor did it vacate the premises. X sued ABC and Y for collection of the unpaid rentals. Will the suit prosper against ABC? Against Y?

a.The suit will prosper against both ABC and Y because both are solidarily liable for crimes and corporate debts

b.The suit will prosper against ABC but not against Y because of their separate juridical personality

c.The suit will not prosper against either ABC or Y because the corporate veil protects corporations and its stockholders from liability

d.The suit will prosper against Y but not against ABC because of their separate juridical personality

2.X is 64 years old and has an employee at AB Co. for 20 years. Under the law, the mandatory retirement age is 65 years old. X is excited to retire because he stands to receive P500,000.00 as his retirement package from AB Co. One month before X turns 65, the Board of AB Co. amends their by-laws to state that the mandatory retirement age at their company shall be 60 years of age. This is approved by 2/3 of the stockholders. As a consequence, X loses his job and forfeits all his retirement benefits. X files a case to recover his retirement benefits. Will he win?

a.Yes, because by-laws cannot impair existing rights nor violate laws

b.Yes, because it is just so unfair, kawawa naman si X

c.Yes, because amendments to by-laws are prohibited by the Revised Corporation Code

d.Yes, because amendments of by-laws must be approved by majority of the stockholders, and not just 2/3

3.A, B, C, D, and E decided to form corporation X, the principal purpose of which was to produce, package, and sell homemade longganisa. The AOI of X Corp. provided, among others, that the business shall be managed by the stockholders rather than by a board and that transfers of shares after incorporation would be subject to several named limitations. B was not content with the way the business was being run, so he demanded that all the stockholders hold a meeting to elect directors, saying that "a corporation is an artificial being and can only act through its board". The other stockholders refuse. Who is correct?

a.A, C, D, and E, because this is a close corporation

b.B, because a corporation is an artificial being and can only act through its board, so directors and officers must be elected so the corporation can act

c.B, because he is merely exercising his right as a stockholder to indirectly manage the corporation