Derivative Suit
Derivative Suit
Derivative Suit
x x x x
The RTC dismissed the Complaint for failure to comply with the
second and fourth requisites above.
in, among other cases, Tam Wing Tak v. Hon. Makasiar and De
Guia66 and in Chua v. Court of Appeals, 67 which was cited in Hi-
Yield Realty, Incorporated v. Court of
Appeals.68
The reasons given for not allowing direct individual suit are:
(3) the filing of such suits would conflict with the duty of
the management to sue for the protection of all concerned;
(1) Devices or schemes employed by, or any act of, the board
of directors, business associates, officers or partners,
amounting to fraud or misrepresentation which may be
detrimental to the interest of the public and/or of the
stockholders, partners, or members of any corporation,
partnership, or association;
(2) Controversies arising out of intra-corporate,
partnership, or association relations, between and among
stockholders, members, or associates; and between, any or
all of them and the corporation, partnership, or association
of which they are stockholders, members, or associates,
respectively;
(Emphasis supplied)
His intent was also explicit from his prayer:
. . . .
Respondent Balmores did not bring the action for the benefit of
the corporation. Instead, hewas alleging that the acts of PPCs
directors, specifically the waiver of rights in favor of
Villamors law firm and their failure to take back the MC Home
Depot checks from Villamor, were detrimental to his individual
interest as a stockholder. In filing an action, therefore, his
intention was to vindicate his individual interest and not PPCs
or a group of stockholders.