V. Loyola Grand Villas
V. Loyola Grand Villas
V. Loyola Grand Villas
inoperative for five years, then it may be suspended or its corporate franchise revoked. But Section 46 and the
other provisions of the Corporation Code do not provide for sanctions for non-filing of the by-laws.
The adoption and filing of by-laws is a condition subsequent which does not affect the corporate
personality of a corporation. This is so because Section 9 of the Corporation Code provides that the
corporate existence and juridical personality of a corporation begins from the date the SEC issues a
certificate of incorporation under its official seal. Consequently, even if the by-laws have not yet been
filed, a corporation may be considered a de facto corporation.
Notwithstanding the provisions of Sec. 46 of the Corporation Code, by-laws may be adopted and filed prior to
incorporation.
By-laws may be necessary for the "government" of the corporation but these are subordinate to the articles of
incorporation as well as to the Corporation Code and related statutes. There are in fact cases where by-laws
are unnecessary to corporate existence or to the valid exercise of corporate powers, thus:
In the absence of charter or statutory provisions to the contrary, by-laws are not necessary either to the
existence of a corporation or to the valid exercise of the powers conferred upon it, certainly in all cases where
the charter sufficiently provides for the government of the body; and even where the governing statute in
express terms confers upon the corporation the power to adopt by-laws, the failure to exercise the power will
be ascribed to mere nonaction which will not render void any acts of the corporation which would otherwise be
valid.
The adoption of by-laws is a matter of practical, if not one of legal, necessity.
In this connection, substantial compliance with conditions subsequent will suffice to perfect corporate
personality. Organization and commencement of transaction of corporate business are but conditions
subsequent and not prerequisites for acquisition of corporate personality. The adoption and filing of
by-laws is also a condition subsequent. Under Section 19 of the Corporation Code, a Corporation
commences its corporate existence and juridical personality and is deemed incorporated from the date
the Securities and Exchange Commission issues certificate of incorporation under its official seal.
Petition DENIED.
Additional notes (optional):
1. Although P.D. 902-A refers to the SEC, the same principles and procedures apply to the public respondent
HIGC as it exercises its power to revoke or suspend the certificates of registration or homeowners association.
(Section 2 [a], E.O. 535, series 1979, transferred the powers and authorities of the SEC over homeowners
associations to the HIGC.)
2. By-laws may be adopted and filed prior to incorporation; in such case, such by-laws shall be approved and
signed by all the incorporators and submitted to the Securities and Exchange Commission, together with the
articles of incorporation.
In all cases, by-laws shall be effective only upon the issuance by the Securities and Exchange Commission of
a certification that the by-laws are not inconsistent with this Code.
3. The Securities and Exchange Commission shall not accept for filing the by-laws or any amendment thereto
of any bank, banking institution, building and loan association, trust company, insurance company, public utility,
educational institution or other special corporations governed by special laws, unless accompanied by a
certificate of the appropriate government agency to the effect that such by-laws or amendments are in
accordance with law.