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    173 - Buenaflor Vs CamSur

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    mimiyuki_
    1) Jaime Buenaflor filed applications in 1957 to construct an ice plant and establish a cold storage facility in Sabang. The Camarines Sur Industry Corporation also filed similar applications after receiving a copy of Buenaflor's applications, despite the corporation's legal existence expiring in 1953. 2) The issue was whether Buenaflor's application should be approved. 3) The court ruled in favor of Buenaflor, finding that the Camarines Corporation was illegally operating since 1953 as it could only legally exist until 1956 to settle its affairs, not continue its ice business. Approving the corporation's application would reward it for violating the law. Bu

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    173 - Buenaflor Vs CamSur

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    1) Jaime Buenaflor filed applications in 1957 to construct an ice plant and establish a cold storage facility in Sabang. The Camarines Sur Industry Corporation also filed similar applications after receiving a copy of Buenaflor's applications, despite the corporation's legal existence expiring in 1953. 2) The issue was whether Buenaflor's application should be approved. 3) The court ruled in favor of Buenaflor, finding that the Camarines Corporation was illegally operating since 1953 as it could only legally exist until 1956 to settle its affairs, not continue its ice business. Approving the corporation's application would reward it for violating the law. Bu

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    1) Jaime Buenaflor filed applications in 1957 to construct an ice plant and establish a cold storage facility in Sabang. The Camarines Sur Industry Corporation also filed similar applications after receiving a copy of Buenaflor's applications, despite the corporation's legal existence expiring in 1953. 2) The issue was whether Buenaflor's application should be approved. 3) The court ruled in favor of Buenaflor, finding that the Camarines Corporation was illegally operating since 1953 as it could only legally exist until 1956 to settle its affairs, not continue its ice business. Approving the corporation's application would reward it for violating the law. Bu

    Copyright:

    © All Rights Reserved
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    Download as docx, pdf, or txt
    35 views1 page

    173 - Buenaflor Vs CamSur

    Uploaded by

    mimiyuki_
    1) Jaime Buenaflor filed applications in 1957 to construct an ice plant and establish a cold storage facility in Sabang. The Camarines Sur Industry Corporation also filed similar applications after receiving a copy of Buenaflor's applications, despite the corporation's legal existence expiring in 1953. 2) The issue was whether Buenaflor's application should be approved. 3) The court ruled in favor of Buenaflor, finding that the Camarines Corporation was illegally operating since 1953 as it could only legally exist until 1956 to settle its affairs, not continue its ice business. Approving the corporation's application would reward it for violating the law. Bu

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    © All Rights Reserved
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    of 1

    BUENAFLORvs.

    CAMARINES SUR INDUSTRY CORPORATION

    (G.R. Nos. L-14991-94; May 30, 1960)

    FACTS: In Aug. and Sept. 1957, Jaime Buenaflor filed applications before the Public Service
    Commission for the construction of a 5-ton ice plant and to establish a cold storage and refrigeration
    service of about 6,000 cubic feet capacity in Sabang, respectively. After being served a copy of the
    application of petitioner, respondent corporation also filed the same applications on Oct.
    1957.Counsel for Buenaflor presented a motion to dismiss on the ground that the corporate life of
    respondent already expired in Nov. 1953. Respondent Corporation then registered on Oct. 1957, a
    new AOI and transferred all assets of the old corporation together with existing certificate of public
    convenience to the new corporation.The PSC provisionally approved the transfer of the assets, as
    well as the certificate of public convenience to the new corporation.On Nov. 1957, the new
    corporation answered the motion to dismiss by alleging its recent incorporation.

    ISSUE: WON Buenaflor’s application should be approved?

    RULING: Yes. Since 1953, the old Corporation had been illegally plying its business of selling ice in
    Sabang because, under the Corporation Law, Sec. 77, after November 1953, it could not lawfully
    continue the business for which it had been established (operate ice plant, sell ice, etc). After
    November 1953, it could only continue to exist for three years for the purpose of prosecuting and
    defending suits by or against it, and of enabling itgradually to settle and close its affairs, to dispose
    and convey its property and to divide its capital stock. It could not, without violating the law,
    continue to sell ice. And yet, the Commission awarded the certificate on the basis of such serve and
    distribution of ice — applying the "prior operator" rule. In other words, the new Camarines
    Corporation is rewarded, precisely because the old corporation, its predecessor, had violated the law
    during that period (1953-1957). We cannot, and should not countenance such anomalous result.

    On the other hand, when the old Camarines Corporation docketed its application October 1, 1957, it
    had no juridical personality, it had ceased to exist as a corporation and could not sue nor apply for
    certificate, for it was incapable of receiving a grant. It was not even a corporation de facto. And then,
    there is no application subscribed by the new Camarines Corporation. Far from being mere
    technicality, these point support a conclusion which appears to be just and equitable, not only for
    the reasons already indicated, but also to compensate Buenaflor's diligence and courage in exposing
    the irregular practice of a "ghost" corporation foisting its services upon the unsuspecting public of
    Sabang and neighboring territory —enjoying a franchise without paying, perhaps, the corporate
    income tax andother burdens attached to corporate existence.

    Remembering the Camarines Corporation's automatic cessation in November 1956 (three years after
    November 1953) we must decline to regard the new Camarines Corporation (formed October 30,
    1957) as a continuation of the old. At most, it is the transferee of the properties of the old
    corporation (or more properly, the assets of the stockholders) plus the certificate of public
    convenience to operate the ice plant in Naga and Magarao. And yet, as stated, the new corporation
    has not filed any application for certificate of public convenience in Sabang, and has not published
    such application.

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