Albert vs University Publishing

Posted: February 8, 2016 in case digests, corporation law, education, Uncategorized
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Albert vs University Publishing

G.R. No. L-19118                 13 Scra 84

January 30, 1965

By: Karen P. Lustica


Facts: In Albert vs. University Publishing Co., Inc., L-9300, April 18, 1958, we found plaintiff entitled to damages (for breach of contract) but reduced the amount from P23, 000.00 to P15, 000.00.


Then in Albert vs. University Publishing Co., Inc., L-15275, October 24, 1960, we held that the judgment for P15,000.00 which had become final and executory, should be executed to its full amount, since in fixing it, payment already made had been considered.


15 years ago, Mariano Albert entered into a contract with University Publishing Co., Inc. through Jose M. Aruego, its President, whereby University would pay plaintiff for the exclusive right to publish his revised Commentaries on the Revised Penal Code.  The contract stipulated that failure to pay one installment would render the rest of the payments due.  When University failed to pay the second installment, Albert sued for collection and won. 


However, upon execution, it was found that the records of this Commission do not show the registration of UNIVERSITY PUBLISHING CO., INC., either as a corporation or partnership. Albert petitioned for a writ of execution against Jose M. Aruego as the real defendant. University opposed, on the ground that Aruego was not a party to the case.


Issue: WON the non-registration of University Publishing Co., Inc. in the SEC is an existing corporation with an independent juridical personality.


Held: No.


Ratio: On account of the non-registration it cannot be considered a corporation, not even a corporation de facto (Hall vs. Piccio, 86 Phil. 603). It has therefore no personality separate from Jose M. Aruego; it cannot be sued independently.


In the case at bar, Aruego represented a non-existent entity and induced not only Albert but the court to believe in such representation. He signed the contract as “President” of “University Publishing Co., Inc.,” stating that this was “a corporation duly organized and existing under the laws of the Philippines”.


“A person acting or purporting to act on behalf of a corporation which has no valid existence assumes such privileges and obligations and becomes personally liable for contracts entered into or for other acts performed as such agent.”


Aruego, acting as representative of such non-existent principal, was the real party to the contract sued upon, and thus assumed such privileges and obligations and became personally liable for the contract entered into or for other acts performed as such agent.


The Supreme Court likewise held that the doctrine of corporation by estoppel cannot be set up against Albert since it was Aruego who had induced him to act upon his (Aruego’s) willful representation that University had been duly organized and was existing under the law.



Dispositive: The order appealed from is hereby set aside.


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