By-laws generally do not bind third parties who are not privy to them, except if the third party has actual or constructive knowledge of the by-laws. Meetings of the board of directors have more flexible requirements for notice and location than meetings of stockholders. The by-laws of a corporation can be amended by majority vote of the board and stockholders, or power can be delegated to the board to amend the by-laws with 2/3 vote of stockholders. This delegation can be revoked by majority vote of stockholders.
By-laws generally do not bind third parties who are not privy to them, except if the third party has actual or constructive knowledge of the by-laws. Meetings of the board of directors have more flexible requirements for notice and location than meetings of stockholders. The by-laws of a corporation can be amended by majority vote of the board and stockholders, or power can be delegated to the board to amend the by-laws with 2/3 vote of stockholders. This delegation can be revoked by majority vote of stockholders.
By-laws generally do not bind third parties who are not privy to them, except if the third party has actual or constructive knowledge of the by-laws. Meetings of the board of directors have more flexible requirements for notice and location than meetings of stockholders. The by-laws of a corporation can be amended by majority vote of the board and stockholders, or power can be delegated to the board to amend the by-laws with 2/3 vote of stockholders. This delegation can be revoked by majority vote of stockholders.
By-laws generally do not bind third parties who are not privy to them, except if the third party has actual or constructive knowledge of the by-laws. Meetings of the board of directors have more flexible requirements for notice and location than meetings of stockholders. The by-laws of a corporation can be amended by majority vote of the board and stockholders, or power can be delegated to the board to amend the by-laws with 2/3 vote of stockholders. This delegation can be revoked by majority vote of stockholders.
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BY-LAWS
The general rule really is that third persons are not bound by the by- laws of a corporation since they are not privy thereto (Fleischer v. Botica Nolasco, 47 Phil. 584). The exception to this is when third persons have actual or constructive knowledge of the same.
-DIFFERENTIATED THE REQUIREMENTS FOR MEETING WITH THAT OF THE BOARD
AND THE STOCKHOLDERS, where for meetings of the board the time place and manner of calling the meeting or the place of the meeting can be stipulated, notice is not necessary. And for MEETINGS OF STOCKHOLDERS the time manner of calling and the mode of notification where meetings can only be held at the principal office and notice is necessary.
Amendment - Sec 47, RCC Amendment may be done in two ways:
1.By majority vote of the Board of Directors/Trustees and vote of the owners of majority of the outstanding capital stock/members, at a regular or special meeting duly called for the purpose; or
2. By delegation of the power to amend, repeal, or adopt new bylaws
to the Board of Directors/Trustees, by the vote of at least ⅔ of the outstanding capital stock/members.
Delegation is deemed revoked whenever a majority of the
outstanding capital stock/ members shall so vote at a regular or special meeting. The amended/new bylaws will only be effective upon the issuance of the SEC of a certification that the bylaws is in accordance with the RCC and relevant laws.
CONTROL AND MANAGEMENT OF CORPORATION
corporation exercises its powers through its board of directors and/or its duly authorized officers and agents, except in instances where the Corporation Code requires stockholders’ approval for certain specific acts. General Powers of the Board 1.To exercise all powers provided for under the RCC;
2. To conduct all business affairs of the corporation; and
3. To control and hold the properties of the corporation.
Note: The concentration of powers in the board is necessary for
purposes of practicality and efficiency in any large organization. Stockholders are too numerous, scattered and unfamiliar with the business of a corporation to conduct its business directly.
What is the Business Judgment Rule?
-decisions made by the Board in good faith concerning corporate affairs, and contracts intra vires entered are binding on the corporation and courts will not interfere, unless such contract are so unconscionable and oppressive as to amount to a wanton destruction of rights of the minority. Qualifications and Disqualifications of Board Members It is a continuing requirement a director to own at least 1 shareholding, and for a trustee be a member. Note: There is no residency requirement. The requirement that majority of the directors/trustees must be residents of the Philippines under Section 23 of BP 68 was deleted by RA11232, otherwise known as the Revised Corporation Code. Disqualification: One is disqualified if within 5 years prior to the election, he/she was: 1. Convicted by final judgment of: a. an offense punishable by imprisonment exceeding 6 years; b. a violation of the Corporate Code; or c. a violation of the Securities Regulation Code (RA no. 8799); 2.Found administratively liable for any offense involving fraudulent acts; or 3.Found liable by a foreign court or equivalent foreign regulatory authority for acts, violations, or misconduct similar to (1) or (2).
A corporation may set disqualifications in its by-laws- see case of
