18. donnina c halley v printwell (gr 157549)

8/14/2019 18. Donnina C Halley v Printwell (GR 157549)

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Republic of the Philippines

Supreme CourtManila

THIRD DIVISION

DONNINA C. HALLEY,

Petitioner,

-versus-

PRINTWELL, INC.,

Respondent.

G.R. No. 157549

Present:

CARPIO MORALS, Chairperson,

!RIO",

!RSAMI",

#ILLARAMA, $R., andSR"O,JJ.

Promul%ated:

Ma& '(, )(**

x-----------------------------------------------------------------------------------------x

D E C I S I O N

BERSAMIN,J:

Stoc+holders of a corporation are liable for the debts of the corporation up to

the etent of their unpaid subscriptions. he& cannot ino+e the eil of corporate

identit& as a shield from liabilit&, because the eil ma& be lifted to aoid

defraudin% corporate creditors.

/eaffirm 0ith modification the decisionpromul%ated on Au%ust *1, )((),2*30hereb& the Court of Appeals4CA5 upheld thedecision of the Re%ional rial

Court, !ranch 6*, in Pasi% Cit& 4RC5, 2)3orderin% the defendants 4includin% the

petitioner5to pa& to Print0ell, Inc. 4Print0ell5 the principal sum of P)7*,'1).68

plus interest.
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Ant!"nt#

he petitioner 0asan incorporator and ori%inal director of !usiness Media

Philippines, Inc. 4!MPI5, 0hich, at its incorporation on "oember *), *796, 2'3hadan authoried capital stoc+ of P',(((,(((.(( diided into '((,((( shares each 0ith

a par alue of P*(.((,of 0hich 6;,((( 0ere initiall& subscribed, to 0it:

Subscriber "o. of shares otal subscription Amount paid

u *9,((( P *9(,(((.(( P1;,(((.((

?enaida #. >u ),((( P )(,(((.(( P;,(((.((

Rialino C. #inea ),((( P )(,(((.(( P;,(((.((

OAL 6;,((( P6;(,(((.(( P*96,;((.((

Print0ellen%a%ed in commercial and industrial printin%.!MPI

commissioned Print0ell for the printin% of the ma%ainePhilippines, Inc. 4to%ether

0ith 0rappers and subscription cards5 that !MPI published and sold. @or that

purpose, Print0ell etended '(-da& credit accommodations to !MPI.

In the period from October **, *799 until $ul& *), *797, !MPI placed0ithPrint0ell seeral orders on credit, eidenced b&inoices and delier& receipts

totalin%P'*8,'1).68.Considerin% that !MPI paidonl&P);,(((.((,Print0ell

sued!MPIon $anuar& )8, *77( for the collection of the unpaid balance

of P)7*,'1).68 in the RC.213

On @ebruar& 9, *77(,Print0ell amended thecomplaint in order to implead as

defendants all the ori%inal stoc+holders and incorporators to recoer on theirunpaid

subscriptions, as follo0s:2;3

"ame npaid Shares

u P*;,(((.((

Rialino C. #iBea P*;,(((.((
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OAL P ;8),;((.((

he defendants filed a consolidated ans0er,283aerrin% that the& all had paid

their subscriptions in full that !MPI had a separate personalit& from those of itsstoc+holders thatRialino C. #iBea had assi%ned his full&-paid up sharesto a

certain Derardo R. $acinto in *797 andthat the directors and stoc+holders of !MPI

had resoled to dissole !MPI durin% the annual meetin%held on @ebruar& ;, *77(.

o proe pa&ment of their subscriptions, the

defendantstoc+holderssubmitted in eidence!MPI official receipt 4OR5 no. )*6,

OR no. )*9, OR no. ))(,OR no. ))*, OR no. ))), OR no. ))', andOR no. ))6,to

0it:

Receipt "o. u P 1;,(((.((

)*9 Ma& *', *799 Albert . >u P *';,(((.((

))( Ma& *', *799 Roberto #. Cabrera, $r. P *';,(((.((

))* "oember ;, *796 Roberto #. Cabrera, $r. P 1;,(((.((

))) "oember ;, *796 ?enaida #. >u P ;,(((.((

))' Ma& *', *799 ?enaida #. >u P *;,(((.((

))6 Ma& *', *799


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irre%ularit& in the issuance of the ORs and obserin%that the defendants had used

!MPIs corporate personalit& to eade pa&ment and create inHustice, viz:

he claim of indiidual defendants that the& hae full& paid their

subscriptions to defend2a3nt corporation, is not 0orth& of consideration, because:J

a5 in the case of defendants-spouses Albert and ?enaida >u, it 0ill be noted

that the alle%ed pa&ment made on Ma& *', *799 amountin%to P*';,(((.((, is coered b& Official Receipt "o. )*9 4h. F)G5,

0hereas the alle%ed pa&ment made earlier on "oember ;, *796,

amountin% to P;,(((.((, is coered b& Official Receipt "o. ))) 4h.F'G5. his is co%ent proof that said receipts 0erebelatedl& issued Hust to

suit their theor& since in the ordinar& course of business, a receipt

issued earlier must hae serial numbers lo0er than those issued on a laterdate. !ut in the case at bar, the receipt issued on "oember ;, *796 has

serial numbers 4)))5 hi%her than those issued on a later date 4Ma& *',

*7995.

b5 he claim that since there 0as no call b& the !oard of u *;,(((.((
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Rialino #. #inea *;,(((.((

--------------------

otal P;8),;((.((

and it is an established doctrine that subscriptions to the capital stoc+ of a

corporation constitute a fund to 0hich creditors hae a ri%ht to loo+ forsatisfaction of their claims 4Philippine "ational !an+ s. !itulo+ Sa0mill, Inc.,

)' SCRA *'885 and, in fact, a corporation has no le%al capacit& to release a

subscriber to its capital stoc+ from the obli%ation to pa& for his shares, and an&a%reement to this effect is inalid 4#elasco s. Poiat, '6 Phil. 9()5.

he liabilit& of the indiidual stoc+holders in the instant case shall be pro-

rated as follo0s:

"ames Amount

u 66,*11.;;

?enaida #. >u 9,;67.(( Rialino #. #inea 9,;67.((

------------------

otal P')*,'1).6;2*;3

he RC disposed as follo0s:

/=R@OR, Hud%ment is hereb& rendered in faor of plaintiff and a%ainst

defendants, orderin% defendants to pa& to plaintiff the amount of P)7*,'1).68, asprincipal, 0ith interest thereon at )(K per annum, from date of default, until full&

paid, plus P'(,(((.(( as attorne&s fees, plus costs of suit.


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I.

= RIAL COR RR< I" =OL ! LIA!L O =

" O@ =IR "PAI< S!SCRIPIO" O@ S=ARS O@ SOC, I@

A">, = RIAL COR "O"=LSS RR< I" "O @I" APPLLA" AL!R > A"< = A!S"C O@ PROO@

CO"RO#RI"D =M.

II.= RC RR< I" =OL SAI< I" A!S"C O@ A"> S=O/I"D O@ RA-OR RSOR =RO.

II.I IS DRA# RROR O" = PAR O@ = COR A NO O RL

=A I"


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On Au%ust *1, )((), the CA affirmed the RC, holdin% that the defendants

resort to the corporate personalit& 0ould createan inHustice becausePrint0ell 0ould

thereb& be at a loss a%ainst 0hom it 0ould assert the ri%ht to collect, viz:

Settled is the rule that 0hen the eil of corporate fiction is used as a means

of perpetratin% fraud or an ille%al act or as a ehicle for the easion of an eistin%obli%ation, the circumention of statutes, the achieements or perfection of

monopol& or %enerall& the perpetration of +naer& or crime, the eil 0ith 0hich

the la0 coers and isolates the corporation from the members or stoc+holders 0hocompose it 0ill be lifted to allo0 for its consideration merel& as an a%%re%ation of

indiiduals 4First Philippine International Bank vs. Court of Appeals, );) SCRA

);75. Moreoer, under this doctrine, the corporate eistence ma& be disre%arded

0here the entit& is formed or used for non-le%itimate purposes, such as to eade aHust and due obli%ations or to Hustif& 0ron% 4Claparols vs. CI, 8; SCRA 8*'5.

In the case at bench, it is undisputed that !MPI made seeral orders oncredit from appellee PRI"/LL inolin% the printin% of business ma%aines,

0rappers and subscription cards, in the total amount of P)7*,'1).68 4Record pp.

'-;, Anne FAG5 0hich facts 0ere neer denied b& appellants stoc+holders thatthe& o0e appellee the amount of P)7*,'1).68. he said %oods 0ere deliered to

and receied b& !MPI but it failed to pa& its oerdue account to appellee as 0ell

as the interest thereon, at the rate of )(K per annum until full& paid. It 0as also

durin% this time that appellants stoc+holders 0ere in char%e of the operation of!MPI despite the fact that the& 0ere not able to pa& their unpaid subscriptions to

!MPI &et %reatl& benefited from said transactions. In ie0 of the unpaid

subscriptions, !MPI failed to pa& appellee of its liabilit&, hence appellee in orderto protect its ri%ht can collect from the appellants stoc+holders re%ardin% their

unpaid subscriptions. o den& appellee from recoerin% from appellants 0ould

place appellee in a limbo on 0here to assert their ri%ht to collect from !MPI sincethe stoc+holders 0ho are appellants herein are aailin% the defense of corporate

fiction to eade pa&ment of its obli%ations.2*63

@urther, the CA concurred 0ith the RC on theapplicabilit& of thetrust fund

doctrine, under 0hich corporate debtors mi%ht loo+ to the unpaid subscriptions for

the satisfaction of unpaid corporate debts, statin% thus:

It is an established doctrine that subscription to the capital stoc+ of a

corporation constitute a fund to 0hich creditors hae a ri%ht to loo+ up to for

satisfaction of their claims, and that the assi%nee in insolenc& can maintain an
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action upon an& unpaid stoc+ subscription in order to realie assets for the

pa&ment of its debts 4P!B vs. Bitulok "a#$ill, )' SCRA *'885.

Premised on the aboe-doctrine, an inference could be made that the funds,

0hich consists of the pa&ment of subscriptions of the stoc+holders, is 0here the

creditors can claim monetar& considerations for the satisfaction of their claims. Ifthese funds 0hich ou%ht to be full& subscribed b& the stoc+holders 0ere not paid

or remain an unpaid subscription of the corporation then the creditors hae no

other recourse to collect from the corporation of its liabilit&. Such occurrence 0aseident in the case at bar 0herein the appellants as stoc+holders failed to full& pa&

their unpaid subscriptions, 0hich left the creditors helpless in collectin% their

claim due to insufficienc& of funds of the corporation. Li+e0ise, the claim of

appellants that the& alread& paid the unpaid subscriptions could not be %ien0ei%ht because said pa&ment did not reflect in the Articles of Incorporations of

!MPI that the unpaid subscriptions 0ere full& paid b& the appellants

stoc+holders. @or it is a rule that a stoc+holder ma& be sued directl& b& creditors

to the etent of their unpaid subscriptions to the corporation 4%eller vs. C&B'arketin(, *1* SCRA 985.

Moreoer, a corporation has no po0er to release a subscription or its capital

stoc+, 0ithout aluable consideration for such releases, and as a%ainst creditors, a

reduction of the capital stoc+ can ta+e place onl& in the manner and under theconditions prescribed b& the statute or the charter or the Articles of Incorporation.

4P!B vs. Bitulok "a#$ill, )' SCRA *'885.2*93

he CAdeclared thatthe inconsistenc& in the issuance of the ORs rendered

the claim of full pa&ment of the subscriptions to the capital stoc+ un0orth& of

consideration andheld that the eil of corporate fiction could be pierced 0hen it

0as used as a shield to perpetrate a fraud or to confuse le%itimate issues, to 0it:

@inall&, appellants SPS >, ar%ued that the fact of full pa&ment for the

unpaid subscriptions 0as incontroertibl& established b& competent testimonial

and documentar& eidence, namel& hibits F*G, F)G, F'G E F1G, 0hich 0ere

neer disputed b& appellee, clearl& sho0s that the& should not be held liable for

pa&ment of the said unpaid subscriptions of !MPI.

he reliance is misplaced.

/e are hereb& reproducin% the contents of the aboe-mentioned ehibits, to

0it:

h: F*G > Official Receipt "o. )*6 dated "oember ;,

*796 amountin% to P1;,(((.(( alle%edl& representin% the initial pa&ment of

subscriptions of stoc+holder Albert >u.
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h: F)G > Official Receipt "o. )*9 dated Ma& *', *799

amountin% to P*';,(((.(( alle%edl& representin% full pa&ment of balance of

subscriptions of stoc+holder Albert >u. 4Record p. ';)5.

h: F'G > Official Receipt "o. ))) dated "oember ;,

*796 amountin% to P;,(((.(( alle%edl& representin% the initial pa&ment of

subscriptions of stoc+holder ?enaida >u.

h: F1G > Official Receipt "o. ))' dated Ma& *',*799 amountin% to P*;,(((.(( alle%edl& representin% the full pa&ment of

balance of subscriptions of stoc+holder ?enaida >u. 4Record p. ';'5.

!ased on the aboe ehibits, 0e are in accord 0ith the lo0er courtsfindin%s that the claim of the indiidual appellants that the& full& paid their

subscription to the defendant !MPI is not 0orth& of consideration, because, in the

case of appellants SPS. >, there is an inconsistenc& re%ardin% the issuance of

the official receipt since the alle%ed pa&ment made on Ma& *', *799 amountin%

to P*';,(((.(( 0as coered b& Official Receipt "o. )*9 4Record, p. ';)5,0hereas the alle%ed pa&ment made earlier on "oember ;, *796 amountin%

to P;,(((.(( is coered b& Official Receipt "o. ))) 4Record, p. ';'5. Suchissuance is a clear indication that said receipts 0ere belatedl& issued Hust to suit

their claim that the& hae full& paid the unpaid subscriptions since in the ordinar&

course of business, a receipt is issued earlier must hae serial numbers lo0er thanthose issued on a later date. !ut in the case at bar, the receipt issued on "oember

;, *796 had a serial number 4)))5 hi%her than those issued on Ma& *',

*799 4)*95. And een assumin% ar%uendo that the indiidual appellants hae paid

their unpaid subscriptions, still, it is er& apparent that the eil of corporate fictionma& be pierced 0hen made as a shield to perpetuate fraud andor confuse

le%itimate issues. 4Jacinto vs. Court of Appeals, *79 SCRA )**5.2*73

Spouses =alle& and #iBea moed for a reconsideration, but the CA denied

their $otion for reconsideration.

I##$#

Onl&


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= COR O@ APPALS RR< I" A@@IRMI"D I" OO =

ALLO/< =PIRCI"D O@ = #IL O@ CORPORA @ICIO"

III.

= =O"ORA!L COR O@ APPALS RR< I" APPL>I"D =RS @"<


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the articles of incorporationbein% at best reflectieonl& of the pre-incorporation

status of !MPI.

As her submissions indicate, the petitioner assails the decisions of the CA

on: 4a5 the propriet& of disre%ardin% the separate personalities of !MPI and itsstoc+holdersb& piercin% the thin eil that separated them and 4b5 the application of

the trust fund doctrine.

R$%&n'

he petition for reie0 fails.

I

T) RTC "&" not *&o%+t

t) Con#t&t$t&on +n" t)Rules of Court

he contention of the petitioner, that the RC merel& copied the

memorandum of Print0ell in 0ritin% its decision, and did not anal&e the records

on its o0n, thereb& manifestin% a bias in faor of Print0ell, is unfounded.

It is noted that the petition for reie0 merel& %enerall& alle%es that startin%

from its pa%e ;, the decision of the RC Fcopied erbatim the alle%ations of herein

Respondents in its Memorandum before the said court,G as if Fthe Memorandum

0as the draft of the


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his adHudicationthe memorandum or the parts of it he deems suitable,and &et not be

%uilt& of the accusation of liftin% or cop&in% from the memorandum. 2)13his

isbecause ofthe ao0ed obHectie of the memorandum to contribute in the proper

illumination and correct determination of the controers&."or is there an&thin%

unto0ard in the con%ruence of ideas and ie0s about the le%al issues bet0eenhimself and the part& draftin% the memorandum.he freQuenc& of similarities in

ar%umentation, phraseolo%&, epression, and citation of authorities bet0een the

decisions of the courts and the memoranda of the parties, 0hich ma& be %reat or

small, can be fairl& attributable tothe adherence b& our courts of la0 and the le%al

profession to 0idel& +no0nor uniersall& accepted precedents set in earlier Hudicial

actions 0ith identical factual milieus or posin% related Hudicial dilemmas.

/e also do not a%ree 0ith the petitioner that the RCs manner of 0ritin%the decisiondepriedher ofthe opportunit& to anal&e its decisionas to be able to

assi%n errors on appeal. he contrar& appears, considerin% that she 0as able to

impute and assi%nerrors to the RCthat she etensiel& discussed in her appeal in

the CA, indicatin% her thorou%h anal&sis ofthe decision of the RC.

Our o0n readin%of the trial courts decision persuasiel& sho0s that the

RC did compl& 0ith the reQuirements re%ardin% the content and the manner of

0ritin% a decision prescribed in the Constitution and theules of Court. he

decision of the RC contained clear and distinct findin%s of facts, and stated theapplicablela0 and Hurisprudence, full& eplainin% 0h& the defendants 0ere bein%

held liable to the plaintiff. In short, the reader 0as at once informed of the factual

and le%al reasons for the ultimate result.

II

Co-o+t -#on+%&t not to / $#" to (o#t &n0$#t&!

Print0ell impleaded the petitioner and the other stoc+holders of !MPI for

t0o reasons, namel&: 4a5 to reach the unpaid subscriptions because it appeared that

such subscriptions 0ere the remainin% isible assets of !MPI and 4b5 to aoid

multiplicit& of suits.2);3
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he petitionersubmits that she had no participation in the transaction

bet0een !MPI and Print0ellthat !MPI acted on its o0n and that shehad no hand

in persuadin% !MPI to rene%e on its obli%ation to pa&. =ence, she should not be

personall& liable.

/e rule a%ainst the petitioners submission.

Althou%h a corporation has a personalit& separate and distinct from those of

its stoc+holders, directors, or officers,2)83such separate and distinct personalit& is

merel& a fiction created b& la0 for the sa+e of conenience and to promote the

ends of Hustice.2)63he corporate personalit& ma& be disre%arded, and the indiiduals

composin% the corporation 0ill be treated as indiiduals, if the corporate entit& is

bein% used as a cloa+ or coer for fraud or ille%alit&as a Hustification for a 0ron%as an alter e%o, an adHunct, or a business conduit for the sole benefit of the

stoc+holders.2)93As a %eneral rule, a corporation is loo+ed upon as a le%al entit&,

unless and until sufficient reason to the contrar& appears. hus,the courts al0a&s

presume %ood faith, andfor that reason accord prime importance to the separate

personalit& of the corporation, disre%ardin% the corporate personalit& onl& after the

0ron%doin% is first clearl& and conincin%l& established. 2)73It thus behooes the

courts to be careful in assessin% the milieu 0here the piercin% of the corporate eil

shall be done.2'(3

Althou%h no0here in Print0ells amended complaint or in the testimonies

Print0ell offered can it be read or inferred from that the petitioner 0as

instrumental in persuadin% !MPI to rene%e onits obli%ation to pa& or that

sheinduced Print0ell to etend the credit accommodation b& misrepresentin% the

solenc& of !MPI toPrint0ell, her personal liabilit&, to%ether 0ith that of her co-

defendants, remainedbecause the CA found her and the other defendant

stoc+holders to be in char%e of the operations of !MPI at the time the unpaid

obli%ation 0as transacted and incurred, to 0it:In the case at bench, it is undisputed that !MPI made seeral orders oncredit from appellee PRI"/LL inolin% the printin% of business ma%aines,

0rappers and subscription cards, in the total amount of P)7*,'1).68 4Record pp.

'-;, Anne FAG5 0hich facts 0ere neer denied b& appellants stoc+holders thatthe& o0e4d5 appellee the amount of P)7*,'1).68. he said %oods 0ere deliered

to and receied b& !MPI but it failed to pa& its oerdue account to appellee as

0ell as the interest thereon, at the rate of )(K per annum until full& paid. It 0as
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also durin% this time that appellants stoc+holders 0ere in char%e of the operation

of !MPI despite the fact that the& 0ere not able to pa& their unpaid subscriptions

to !MPI &et %reatl& benefited from said transactions. In ie0 of the unpaidsubscriptions, !MPI failed to pa& appellee of its liabilit&, hence appellee in order

to protect its ri%ht can collect from the appellants stoc+holders re%ardin% their

unpaid subscriptions. o den& appellee from recoerin% from appellants 0ouldplace appellee in a limbo on 0here to assert their ri%ht to collect from !MPI since

the stoc+holders 0ho are appellants herein are aailin% the defense of corporate

fiction to eade pa&ment of its obli%ations.2'*3

It follo0s, therefore, that 0hether or not the petitioner persuaded !MPI to

rene%e on its obli%ations to pa&, and 0hether or not she induced Print0ell to

transact 0ith !MPI 0ere not %ooddefensesin the suit.

IIIn-+&" !"&to 2+ #+t( &t# !%+&2 (o2

$n-+&" #$/#!&-t&on#3#to!)o%"# 2$#t

-o* ($%% -+2nt o(t)& #$/#!&-t&on#

!oth the RC and the CA applied the trust fund doctrinea%ainst the

defendant stoc+holders, includin% the petitioner.

he petitionerar%ues, ho0eer,that the trust fund doctrine0asinapplicablebecause she had alread& full& paid her subscriptions to the capital

stoc+ of !MPI. She thus insiststhat both lo0er courts erred in disre%ardin% the

eidence on the complete pa&ment of the subscription, li+e receipts, income ta

returns, and releant financial statements.

he petitioners ar%umentis deoid of substance.

he trust fund doctrineenunciates a

rule that the propert& of a corporation is a trust fund for the pa&ment of

creditors, but such propert& can be called a trust fund onl& b& 0a& of analo%& or

metaphor. As bet0een the corporation itself and its creditors it is a simple debtor,

and as bet0een its creditors and stoc+holders its assets are in eQuit& a fund for the

pa&ment of its debts.2')3
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he trust fund doctrine, first enunciated in the American case of )ood v.

*u$$er,2''30as adopted in our Hurisdiction inPhilippine +rust Co. v. ivera,2'130here thisCourt declared that:

It is established doctrine that subscriptions to the capital of a corporationconstitute a fund to 0hich creditors hae a ri%ht to loo+ for satisfaction of their

claims and that the assi%nee in insolenc& can maintain an action upon an& unpaid

stoc+ subscription in order to realie assets for the pa&ment of its debts. 4#elasco

s. Poiat, '6 Phil., 9()5 2';3

/e clarif& that the trust fund doctrineis not limited to reachin% the

stoc+holders unpaid subscriptions. he scope of the doctrine 0hen the corporation

is insolent encompasses not onl& the capital stoc+, but also other propert& and

assets %enerall& re%arded in eQuit& as a trust fund for the pa&ment of corporate

debts.2'83All assets and propert& belon%in% to the corporation held in trust for the

benefit of creditors that0ere distributed or in the possession of the stoc+holders,

re%ardless of full pa&mentof their subscriptions, ma& be reached b& the creditor in

satisfaction of its claim.

Also, under the trust fund doctrine,a corporation has no le%al capacit& to

release an ori%inal subscriber to its capital stoc+ from the obli%ation of pa&in% for

his shares, in 0hole or in part,2'630ithout a aluable consideration,2'93or

fraudulentl&, to the preHudice of creditors.2'73he creditor is allo0ed to maintain anaction upon an& unpaid subscriptions and thereb& steps into the shoes of the

corporation for the satisfaction of its debt. 21(3o ma+e out apri$a faciecase in a

suit a%ainst stoc+holders of an insolent corporation to compel them to contribute

to the pa&ment of its debts b& ma+in% %ood unpaid balances upon their

subscriptions, it is onl& necessar& to establish that thestoc+holders hae not in %ood

faith paid the par alue of the stoc+s of the corporation.21*3

he petitionerposits that the findin% of irre%ularit& attendin% the issuance of

the receipts 4ORs5 issued to the other stoc+holderssubscribers should not affect her

becauseher receipt did not suffer similar irre%ularit&.

"ot0ithstandin% that the RC and the CA did not find an& irre%ularit& in the

OR issued in her faor,0e still cannot sustain the petitioners defense of full

pa&ment of her subscription.
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In ciil cases, thepart& 0ho pleads pa&ment has the burden of proin% it, that

een 0here the plaintiff must alle%e nonpa&ment, the %eneral rule is that the

burden rests on the defendant to proe pa&ment, rather than on the plaintiff to

proe nonpa&ment. In other 0ords, the debtor bears the burden of sho0in% 0ithle%al certaint& that the obli%ation has been dischar%ed b& pa&ment.21)3

Apparentl&, the petitioner failed to dischar%e her burden.

A receipt is the 0ritten ac+no0led%ment of the fact of pa&ment in mone& or

other settlement bet0een the seller and the bu&er of %oods, thedebtor or

thecreditor, or theperson renderin% serices, and theclient or thecustomer.21'3

Althou%ha receipt is the best eidence of the fact of pa&ment, it isnot conclusie,but merel& presumptienor is it eclusie eidence,considerin% thatparole

eidence ma& also establishthe fact of pa&ment.2113

he petitioners OR"o. ))6,presentedto proe the pa&ment of the balance of

her subscription, indicated that her supposed pa&ment had beenmade b& means of a

chec+. hus, to dischar%e theburden to proe pa&ment of her subscription, she had

to adduce eidence satisfactoril& proin% that her pa&ment b& chec+ 0asre%ardedas

pa&ment under the la0.

Pa&mentis defined as the delier& of mone&.21;3>et, because a chec+ is not

mone& and onl& substitutes for mone&, the delier& of a chec+ does not operate as

pa&ment and does not dischar%e the obli%ation under a Hud%ment.2183he delier& of

a bill of echan%e onl& produces the fact of pa&ment 0hen the bill has been

encashed.2163he follo0in% passa%e fromBank of Philippine Islands v. oeca2193is

enli%htenin%:

Settled is the rule that pa&ment must be made in le%al tender. A !)! not

%'+% tn" +n", t)(o, !+nnot !on#t&t$t + *+%&" tn" o( -+2nt.S&n! + n'ot&+/% &n#t$2nt on% + #$/#t&t$t (o 2on +n" not 2on,

t) "%&* o( #$!) +n &n#t$2nt "o# not, / &t#%(, o-+t +# -+2nt.

M "%&* o( !)!# "o# not "!)+' t) o/%&'+t&on $n" + 0$"'2nt.

T) o/%&'+t&on not t&n'$)" +n" 2+&n# #$#-n"" $nt&% t) -+2nt

/ !o22!&+% "o!$2nt +!t$+%% +%&6".
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To #t+/%) t)& "(n#, t) #-on"nt# t)(o )+" to -#nt

-oo(, not on% t)+t t) "%&*" t) !)!# to t) -t&t&on, /$t +%#o t)+t

t) !)!# n!+#)".he respondents failed to do so. H+" t) !)!#

/n +!t$+%% n!+#)", t) #-on"nt# !o$%" )+* +#&% -o"$!" t)

!+n!%%" !)!# +# *&"n! to -o* t) #+2. In#t+", t) 2% +*"

t)+t t) /%&*" &n 'oo" (+&t) t)+t t) !)!# n!+#)" /!+$# t) not not&(&" o( t) ")ono o( t) !)!# +n" t) +# )+" +%+"

%+-#" #&n! t) #$" t) !)!#.

!ecause of this failure of the respondents to present sufficient proof of

pa&ment, it 0as no lon%er necessar& for the petitioner to proe non-pa&ment,

particularl& proof that the chec+s 0ere dishonored. he burden of eidence is

shifted onl& if the part& upon 0hom it is lod%ed 0as able to adduce preponderanteidence to proe its claim.

Ostensibl&, therefore, the petitioners mere submission of the receipt issued

in echan%e of the chec+ did not satisfactoril& establish her alle%ation of full

pa&ment of her subscription. Indeed, she could not een inform the trial court

about the identit& of her dra0ee ban+,2173and about 0hether the chec+ 0as cleared

and its amount paid to !MPI.2;(3In fact, she did not present the chec+ itself.

heincome ta return 4IR5 and statement of assets and liabilities of !MPI,

albeit presented, had no bearin% on the issue of pa&ment of the subscription

because the& did not b& themseles proe pa&ment. IRsestablish atapa&ers

liabilit& for taes or a tapa&ers claim for refund. In the same manner, the depositslips and entries in the passboo+ issued in the name of !MPI 0ere hardl&

releant due to their not reflectin% the alle%ed pa&ments.

It is notable, too, that the petitioner and her co-stoc+holders did not support

their alle%ation of complete pa&ment of their respectie subscriptions 0ith the

stoc+ and transfer boo+ of !MPI. Indeed, boo+s and records of a corporation

4includin% the stoc+ and transfer boo+5 are admissible in eidence in faor of or

a%ainst the corporation and its members to proe the corporate acts, its financial

status and other matters 4li+e the status of the stoc+holders5, and are ordinaril& the

best eidence of corporate acts and proceedin%s.2;*3Specificall&, a stoc+ and transfer

boo+ is necessar& as a measure of precaution, epedienc&, and conenience

because it proides the onl& certain and accurate method of establishin% the

arious corporate acts and transactions and of sho0in% the o0nership of stoc+ and

li+e matters.2;)3hat she tendered no eplanation 0h& the stoc+ and transfer boo+
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19/22

he RC declared the stoc+holderspro rataliable for the debt4based on the

proportion to their shares in the capital stoc+ of !MPI5 and held the

petitionerpersonall& liable onl&in the amount of P*17,7;;.8;.

/e do not a%ree. he RC lac+ed the le%al and factual support for its

proratin% the liabilit&. =ence, 0e need to modif& the etent of the petitioners

personal liabilit& to Print0ell. he preailin% rule is that a stoc+holder is

personall& liable for the financial obli%ations of the corporation to the extent of his

unpaid subscription.2;'3In ie0 ofthe petitioners unpaid subscription bein%

0orth P)8),;((.((, she0as liable up to that amount.

Interest is also imposable on the unpaid obli%ation. Absent an& stipulation,interest is fied at *)Kper annu$from the date the amended complaint 0as filed

on @ebruar& 9, *77( until the obli%ation 4 i.e., to the etent of the petitioners

personal liabilit& of P)8),;((.((5 is full& paid.2;13

Lastl&, 0e find no basis to%rant attorne&s fees, the a0ard for 0hich must be

supported b& findin%s of fact and of la0 as proided under Article ))(9 of

the Civil Code2;;3incorporated in the bod& of decision of the trial court. he absence

of the reQuisite findin%s from the RC decision 0arrants the deletion of the

attorne&s fees.

ACCORDINGLY, 0e den& the petition for reie0 on certiorariand affirm

0ith modification the decision promul%ated on Au%ust *1, )(()b& orderin% the

petitionerto pa& to Print0ell, Inc. the sum of P)8),;((.((, plus interest of *)Kper

annu$to be computed from @ebruar& 9, *77( until full pa&ment.

he petitioner shall pa&cost of suit in this appeal.

SO ORDERED.
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LCAS P. BERSAMIN

Associate $ustice

WE CONCR:

CONCHITA CARPIOMORALES

Associate $ustice

Chairperson

ARTRO D. BRION MARTIN S. VILLARAMA

Associate $ustice Associate $ustice

MARIA LORDES P. A. SERENO

Associate $ustice

A T T E S T A T I O N

I attest that the conclusions in the aboe


21/22

C E R T I 8 I C A T I O N

Pursuant to Section *', Article #III of the Constitution, and the


22/22

2)83 Section ), Corporation Code Article 11 4'5, Civil CodeFrancisco 'otors Corporation v. Court of Appeals,

D.R. "o. *((9*), $une );, *777, '(7 SCRA 6), 9).2)63 Prudential Bank v. Alviar, D.R. "o. *;(*76, $ul& )9, )((;, 181 SCRA ';', '8)'artinez v. Court of

Appeals, D.R. "o. *'*86', September *(, )((1, 1'9 SCRA *'(, *17-*;(.2)93 2i(ht ail +ransit Authorit v. enus, Jr., D.R. "o. *8'69), March )1, )((8, 19; SCRA '8*, '6)34+ransport, Inc. v. 2ata(, D.R. "o. *;;)*1, @ebruar& *', )((1, 1)) SCRA 879 "ecosa v. eirs of 4r#in "uarez

Francisco, D.R. "o. *8(('7, $une )7, )((1, 1'' SCRA )6'5ochan v. /oun(, D.R. "o. *'*997, March *), )((*,';1 SCRA )(6, )))*evelop$ent Bank of the Philippines v. Court of Appeals, D.R. "o. **()(', Ma& 7, )((*, ';6

SCRA 8)8*el osario v. !ational 2abor elations Co$$ission, D.R. "o. 9;1*8, $ul& )1, *77(, *96 SCRA 666,

69(.2)73 "olidbank Corporation v. 'indanao Ferroallo Corporation, D.R. "o. *;';';, $ul& )9, )((;, 181 SCRA 1(7,

1)1-1); Construction 3 *evelop$ent Corporation of the Philippines v. Cuenca , D.R. "o. *8'79*, Au%ust *),

)((;, 188 SCRA 6*1, 6)6'atu(uina Inte(rated )ood Products, Inc. v. Court of Appeals, D.R. "o. 79'*(,October )1, *778, )8' SCRA 17(, ;(7.2'(3 Francisco 'otors Corporation v. Court of Appeals,supra, note )8.2'*3 ollo, p. 1;.2')3 1)A, /ords and Phrases, +rust Fund *octrine, p. 11;, citin%'cIver v. /oun( ard#are Co., ;6 S.. *87,

*6*, *11 ".C. 169, **7 Am. St. Rep. 76( 5alla(her v. Asphalt Co. of A$erica, ;; A. );7, )8), 8; ".$. Q. );9.2''3 ' Mason '(9, @ed Cas. "o. *6, 711.2'13 11 Phil 187 4*7)'5.2';3 Id., p. 16(.2'83 #illanuea,Philippine Corporate 2a#4)((*5, pp. ;;9, citin% Chica(o ock Island 3 Pac. .. Co. v.

o#ard, 6 )all., '7), *7 L. d. **6 "a#er v. oa(, *6 /all 8*(, )* L. d. 6'* andPull$an v. 7pton, 78 .S.')9, )1 L. d. 9*9.2'63 elasco v. Poizat, '6 Phil 9(), 9(9 4*7*95.2'93 Philippine +rust v. ivera,supra, note '1, pp. 16(-16*.2'73 Fo(( v. Blair, *'7 S **9 4*97*5.21(3 See elasco v. Poizat, '6 Phil 9(), 9(8 4*7*95.21*3 +ierne v. 2edden, *)* "/ *(;(.21)3 Alonzo v. "an Juan, D.R. "o. *'6;17, @ebruar& **, )((;, 1;* SCRA 1;, ;;-;8 7nion efiner Corporation

v. +olentino, "r., D.R. "o. *;;8;', September '(, )((;, 16* SCRA 8*', 8)*.21'3 Co$$issioner of Internal evenue v. 'anila 'inin( Corporation, D.R. "o. *;')(1, Au%ust '*, )((;, 189

SCRA ;6*, ;7(.2113 Philippine !ational Bank v. Court of Appeals, D.R. "o. **8*9*, April *6, *778, );8 SCRA 17*, '';-''8 +o#ne 3 Cit *evelop$ent Corporation v. Court of Appeals, D.R. "o. *';(1', $ul& *1, )((1, 1'1 SCRA ';8,

'8*-'8).21;3 Art. *)'), Civil Code.2183 Philippine Airlines, Inc. v. Court of Appeals, D.R. "o. 17*99, $anuar& '(, *77(, *9* SCRA ;;6, ;89.2163 Art. *)17, Civil Code.2193 D.R. "o. *68881, $ul& )*, )((9, ;;7 SCRA )(6, )*6-)*7 4underscorin% supplied for emphasis5.2173 See S" dated "oember 8, *77*, p. 1.2;(3 S" dated "oember 8, *77*, p. 1.2;*3 Biton( v. Court of Appeals 8Fifth *ivision9, D.R. "o. *)';;', $ul& *', *779, )7) SCRA ;(', ;)'.2;)3 2anuza v. Court of Appeals, D.R. "o. *'*'71, March )9, )((;, 1;1 SCRA ;1, 86.2;'3 4d#ard A. %eller 3 Co., 2td., v. C&B 5roup 'arketin(, Inc., D.R. "o. L-897(6, $anuar& *8, *798, *1* SCRA

98, 7' citin% da. *e "alvatierra v. on. 5arlitos etc, and efuerzo, *(' Phil, 6;6, 68' 4*7;95.2;13

See4astern "hippin( 2ines, Inc. v. Court of Appeals, D.R. "o. 761*), $ul& *), *771, )'1 SCRA 69.2;;3 Buni v. Factor, D.R. "o. *6);16, $une '(, )((7, ;7* SCRA ';(, '8': 2apanda A(ricultural and

*evelop$ent Corporation 82A*4C&9 v. An(ala, D.R. "o. *;'(68, $une )*, )((6, ;); SCRA ))7Pa1uo v. Courtof Appeals, D.R. "o. *18'81, $une ', )((1, 1'( SCRA 17), ;)1.
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18. donnina c halley v printwell (gr 157549)

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