Doctrines and Principles - RRC

23問 • 1年前

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The courts may hold corporators, officers, and directors personally liable if the corporation was used to justify a wrong, protect fraud, or to perpetuate a deception.

Doctrine of Piercing the Corporate Veil

Each share shall be equal in all respects to every other shares except as provided by the Articles of Incorporation and stated in the Certificate of Stock.

Doctrine of Equality of Shares

Capital stock subscriptions of a corporation constitute and fund to which creditors have a right to look for the satisfaction of their claims.

Trust Fund Doctrine

Contracts intra vires entered into by the Board are binding upon the corporation and the courts will not interfere unless such contracts are unconscionable and oppressive as to amount to wanton disregard to the rights of the minority.

Business Judgment Rule

Right of the stockholder to sue on behalf of the corporation in the name of the corporation.

Derivative Suit

Where a stockholder is denied the right of inspection, his suit would be individual because the wrong is done to him personally and not to the other stockholders.

Individual Suit

Where the wrong is done to a group of stockholders this suit will be proper for the protection of all stockholders belonging in the same group.

Class or Representative Suit

A director or trustee elected to fill a vacancy and serves only the unexpired term of the predecessor

Replacement Director/Trustee

When a director acquires for himself a business opportunity which belongs to the corporation, thereby obtaining profits to the prejudice of the corporation, he must account to the latter for all such profits by refunding the same.

Doctrine of Corporate Opportunity

Error in business judgment not amounting to bad faith or negligence, directors, and officers are not liable.

Error in Business Judgment Rule

A contract of the corporation with one of its directors, trustees, officers, or their spouses and relatives within the fourth civil degree of consanguinity or affinity is a rule voidable at the option of the corporation.

Self-Dealing Directors

Members of the board of directors in a certain corporation who are also directors in another corporation.

Interlocking Directors

Stockholdings exceeding 20% of outstanding capital stock

Substantial interest

An agreement whereby a corporation delegates the management of its affairs to another corporation for a certain period not exceeding 5 years for any one term.

Management Contract

For stock corporations, quorum is based on the outstanding capital stock while for nonstock corporations, only living members with voting rights are counted.

Quorum

Generally, every decision reached by at least a majority of the directors or trustees constituting a quorum shall be valid as a corporate act.

Valid Corporate Act

Any contract for the acquisition of unissued stocks in an existing corporation or one to be formed shall be deemed a subscription notwithstanding that the parties refer to it as some other contract.

Subscription Contract

Dissenting stockholders who voted against the proposed corporate action may choose to get out of the corporation by demanding payment of the fair market value of his share

Appraisal Right

It is the preferential right of all stockholders to stock corporations to subscribe to all issues or disposition of shares of any class, in proportion to their respective shareholdings.

Pre-emptive Right

Is an agreement between a group of stockholders and a trustee which results in the separation of voting rights of a stockholder from his other rights in the corporation.

Voting Trust Agreement

Is one engaged principally in the business of registering transfer of stocks in behalf of a stock corporation provided a license to operate has been issued by the SEC while making payment of the required fee and renewable annually.

Stock transfer agent

The corporation or the stockholder has the right of first refusal meaning that the stockholder who wants to sell his shares to a third person must first offer it either to the corporation or to other stockholders.

Right of First Refusal

Any activity undertaken in the Philippines involving profit-making.

“Doing Business”

FAR Quizzers For Post Test And Term Examination

Mark Anthony Germono · 24問 · 1年前

FAR Quizzers For Post Test And Term Examination