Lipat v.
Pacific Banking Corporation
(G.R. No. 142435)
Jun4by Jai Cdn
Facts:
Petitioners, the spouses Alfredo Lipat and Estelita Burgos Lipat, owned Belas
Export Trading (BET), a single proprietorship engaged in the manufacture of
garments for domestic and foreign consumption, which was managed by their
[Link]
United States, which sells goods imported from the Philippines through BET,
[Link],a
specialpowerofattorneywasexecutedappointingTeresitaLipattoobtainloansand
othercreditaccommodationsfromrespondentPacificBankingCorporation(Pacific
Bank)andtoexecutemortgagecontractsonpropertiesownedorcoownedbyheras
[Link],aloanwas
secured for and in behalf of Mrs. Lipat and BET, a Real Estate Mortgage was
executedovertheirproperty.
BET was then incorporated into a family corporation named Belas Export
Corporation(BEC)engagedinthebusinessofmanufacturingandexportationofall
kindsofgarmentsandutilizedthesamemachineriesandequipmentpreviouslyused
by BET. Eventually, the loan was later restructured in the name of BEC and
subsequent loans were obtained with the corresponding promissory notes duly
[Link]
[Link],therealestatemortgagewasforeclosed
and was sold at public auction to respondent Eugenio [Link] as the highest
bidder.
ThespousesLipatfiledacomplaintalleging,amongothers,thatthepromissorynotes,
trust receipt, and export bills were allultra viresacts of Teresita as they were
executedwithouttherequisiteboardresolutionoftheBoardofDirectorsofBEC.
TheyalsoaverredthatassumingsaidactswerevalidandbindingonBEC,thesame
werethecorporationssoleobligation,ithavingapersonalitydistinctandseparate
fromthespouses.
Thetrialcourtruledthattherewasconvincingandconclusiveevidenceprovingthat
[Link],itwasamereextensionof
petitionerspersonalityandbusinessandamerealteregoorbusinessconduitofthe
[Link],
[Link],thispetition.
Issue:
Whetherornotthedoctrineofpiercingtheveilofcorporatefictionisapplicablein
thiscase.
Ruling:
PetitionerscontentionsfailtopersuadethisCourt.
AcarefulreadingofthejudgmentoftheRTCandtheresolutionoftheappellatecourt
showthatinfindingpetitionersmortgagedpropertyliablefortheobligationsofBEC,
bothcourtsbelowrelieduponthealteregodoctrineorinstrumentalityrule,rather
than fraud in piercing the veil of corporate fiction. When the corporation is the
merealter egoor business conduit of a person, the separate personality of the
[Link]
rule or thealter egodoctrine, which the courts have applied in disregarding the
separatejuridicalpersonalityofcorporations.
Wefindthattheevidenceonrecorddemolishes,ratherthanbuttresses,petitioners
[Link]
admittedthatsheandherhusband,Alfredo,weretheownersofBETandweretwoof
[Link]
Lipatexecutedaspecialpowerofattorneyinfavorofherdaughter,Teresita,toobtain
loans andcreditlines [Link],Teresitawas
designatedasexecutivevicepresidentandgeneralmanagerofbothBETandBEC,
[Link]:(1)EstelitaandAlfredoLipataretheownersand
majorityshareholdersofBETandBEC,respectively;(2)bothfirmsweremanagedby
their daughter, Teresita; (3) both firms were engaged in the garment business,
supplyingproductstoMysticalFashion,[Link];
(4)bothfirmsheldofficeinthesamebuildingownedbytheLipats;(5)BECisa
family corporation with the Lipats as its majority stockholders; (6) the business
[Link]
practicallyindistinguishable;(7)thecorporatefundswereheldbyEstelitaLipatand
thecorporationitselfhadnovisibleassets;(8)theboardofdirectorsofBECwas
composedoftheBurgosandLipatfamilymembers;(9)Estelitahadfullcontrolover
theactivitiesofanddecidedbusinessmattersofthecorporation;andthat(10)Estelita
LipathadbenefitedfromtheloanssecuredfromPacificBanktofinanceherbusiness
abroad and from the export bills secured by BEC for the account of Mystical
[Link]
with each other in terms of ownership, business purpose, and management.
Apparently,BETandBECareoneandthesameandthelatterisaconduitofand
[Link]
behindthecorporatepersonalityofBECsoastoevadetheirliabilitiestoPacificBank
ispreciselywhattheclassicaldoctrineofpiercingtheveilofcorporateentityseeksto
[Link],BECisamerecontinuationandsuccessorofBET
andpetitionerscannotevadetheirobligationsinthemortgagecontractsecuredunder
thenameofBEConthepretextthatitwassignedforthebenefitandunderthename
[Link]
appliedtheinstrumentalitydoctrineinpiercingthecorporateveilofBEC.
Wherefore,thepetitionisdenied.
