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    Naguiat Vs NLRC

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    VinceOnikaa PerryGermanotta
    1) Sergio F. Naguiat was the president of Clark Field Taxi, Inc. (CFTI) and actively managed the business. Antolin Naguiat was the vice president but there was no evidence of his involvement in management. 2) When Clark Air Base closed, CFTI's taxi business ended and employees filed for separation pay. Officers can be personally liable for corporate obligations if they are actively involved in management. 3) The court ruled that Sergio, as active president, was personally liable for separation pay. But without evidence of Antolin's management role, he could not be held liable. Close family corporations have strict fiduciary duties between shareholders.

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    Naguiat Vs NLRC

    Uploaded by

    VinceOnikaa PerryGermanotta
    36 views1 page
    1) Sergio F. Naguiat was the president of Clark Field Taxi, Inc. (CFTI) and actively managed the business. Antolin Naguiat was the vice president but there was no evidence of his involvement in management. 2) When Clark Air Base closed, CFTI's taxi business ended and employees filed for separation pay. Officers can be personally liable for corporate obligations if they are actively involved in management. 3) The court ruled that Sergio, as active president, was personally liable for separation pay. But without evidence of Antolin's management role, he could not be held liable. Close family corporations have strict fiduciary duties between shareholders.

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    Naguiat vs NLRC

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    1) Sergio F. Naguiat was the president of Clark Field Taxi, Inc. (CFTI) and actively managed the business. Antolin Naguiat was the vice president but there was no evidence of his involvement in management. 2) When Clark Air Base closed, CFTI's taxi business ended and employees filed for separation pay. Officers can be personally liable for corporate obligations if they are actively involved in management. 3) The court ruled that Sergio, as active president, was personally liable for separation pay. But without evidence of Antolin's management role, he could not be held liable. Close family corporations have strict fiduciary duties between shareholders.

    Copyright:

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

    Naguiat Vs NLRC

    Uploaded by

    VinceOnikaa PerryGermanotta
    1) Sergio F. Naguiat was the president of Clark Field Taxi, Inc. (CFTI) and actively managed the business. Antolin Naguiat was the vice president but there was no evidence of his involvement in management. 2) When Clark Air Base closed, CFTI's taxi business ended and employees filed for separation pay. Officers can be personally liable for corporate obligations if they are actively involved in management. 3) The court ruled that Sergio, as active president, was personally liable for separation pay. But without evidence of Antolin's management role, he could not be held liable. Close family corporations have strict fiduciary duties between shareholders.

    Copyright:

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

    Naguiat vs.

    NLRC

    FACTS:
    Clark Field Taxi, Inc. (CFTI) held a concessionaire contract within the Clark Air Base. Its President and Vice-President
    were Sergio F. Naguiat and Antolin Naguiat, respectively. They also owned Sergio F. Naguiat Enterprises, Inc, a trading
    business. These two corporations are family-owned. The President, Sergio F. Naguiat supervised and determined the
    employment terms of the drivers of their taxi business while no evidence was offered on the extent of his son,
    Antolin Naguiat’s participation in the management or operation of the business. They stopped their taxi business due
    to the expiration of the RP-US military bases agreement which resulted to the phasing out of Clark Air Base. The
    employees of CFTI who were separated from service because of the closure of Clark Air Base filed an action for the
    payment of their separation pay.

    ISSUE:
    Are officers of corporations ipso facto liable jointly and severally with the companies they represent for the
    settlement of its corporate obligations?

    RULING:
    No. In case of close corporations, not all are personally liable but only those who were actively engaged in the
    management or operation of the business. Section 100 paragraph 5 of the Corporation Code states that the
    stockholders shall be held to strict fiduciary duties to each other and among themselves to the extent that the
    stockholders are actively engaged in the management or operation of the business and affairs of a close corporation.
    Said stockholders shall be personally liable for corporate torts unless the corporation had obtained reasonably
    adequate liability insurance. Therefore, the President who had actively engaged in the management and operation of
    CFTI is held solidarily liable however, the Vice-President in the absence of evidence on the extent of his participation
    in the operation of the business cannot be held solidarily liable.

    The rule that a corporate officer cannot be held solidarily with a corporation in the absence of evidence that he had
    acted in bad faith or with malice is not applicable in this case.

    NOTES:

    Corporation Law
    Sergio F. Naguiat, admittedly, was the president of CFTI who actively managed the business. Thus, applying the ruling
    in A. C. Ransom, he falls within the meaning of an “employer” as contemplated by the Labor Code, who may be held
    jointly and severally liable for the obligations of the corporation to its dismissed employees.

    Close Family Corporations


    Moreover, petitioners also conceded that both CFTI and Naguiat Enterprises were “close family corporations” owned
    by the Naguiat family. Section 100, paragraph 5, (under Title XII on Close Corporations) of the Corporation Code,
    states:
    “(5) To the extent that the stockholders are actively engage(d) in the management or operation of the business and
    affairs of a close corporation, the stockholders shall be held to strict fiduciary duties to each other and among
    themselves. Said stockholders shall be personally liable for corporate torts unless the corporation has obtained
    reasonably adequate liability insurance.”

    Corporate Torts
    Our jurisprudence is wanting as to the definite scope of “corporate tort.” Essentially, “tort” consists in the violation of
    a right given or the omission of a duty imposed by law.[35] Simply stated, tort is a breach of a legal duty.[36] Article
    283 of the Labor Code mandates the employer to grant separation pay to employees in case of closure or cessation
    of operations of establishment or undertaking not due to serious business losses or financial reverses, which is the
    condition obtaining at bar. CFTI failed to comply with this law-imposed duty or obligation. Consequently, its
    stockholder who was actively engaged in the management or operation of the business should be held personally
    liable.

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