1.
Definitions
A.Articles of incorporation
It is a compilation of formal documents made by those who are forming a corporation as a separate
legal entity. It must be filed with the Securities and Exchange Commission and include all of the code’s
requirements. It becomes a public record and contains important information about the company.
B.De facto corporation
One that functions as a company for all practical reasons but has no legal right to operate as a
corporation in the eyes of the state. It is a corporation by virtue of its actions, even though it is not a
corporation by law or by right. It is one that has not met all of the essential standards but has done so
sufficiently to be granted corporate status against third parties but not against the state.
C.De jure corporation
It is a corporation that is formed in strict or significant compliance with the obligatory statutory
requirements for incorporation and whose right to exist as a corporation cannot be successfully
challenged by any party, even in a direct action brought by the state for that purpose.
D.Collateral Attack
One in which the existence of a corporation is called into doubt in a non-legal action with the deliberate
intention of undermining the corporation’s existence.
2. It is required for the existence of a de facto corporation under Section 20. That there be a valid law
under which a corporation with powers assumed might be incorporated; a bona fide attempt to
organize a corporation under such law; and the actual user or exercise in good faith of corporate powers
conferred upon it by law.
3.No, a corporation cannot come into existence by mere agreement of the parties like in the formation
of a general partnership. A corporation is merely a creation of law; its creation requires the state’s
approval. In the Philippines, the formation of a private corporation is governed by the Corporation Code
and the consent of the state is given through the Securities and Exchange Commission (SEC).
4. No, as stated in Section 23, a board of directors is elected by the investors to oversee the
corporation's management and operations. They are not the corporation's agents, and so their actions
cannot bind it.
5.Ultra vires act means simply an act which is beyond the conferred powers of a corporation or the
purposes for which it is created. Its act is not necessarily illegal. In contrast, it may be lawful and moral.
While an illegal act, is an act which is contrary to good customs,law,moral, public policy and, therefore,
illegal per se,which are things that are inherently lawful.
1.Definitions
Articles of incorporation
It is a compilation of formal documents made by those who are forming a corporation as a separate
legal entity. It must be filed with the Securities and Exchange Commission and include all of the code’s
requirements. It becomes a public record and contains important information about the company.
B.De facto corporation
One that functions as a company for all practical reasons but has no legal right to operate as a
corporation in the eyes of the state. It is a corporation by virtue of its actions, even though it is not a
corporation by law or by right. It is one that has not met all of the essential standards but has done so
sufficiently to be granted corporate status against third parties but not against the state.
C.Corporation de jure
It is a corporation that is formed in strict or significant compliance with the obligatory statutory
requirements for incorporation and whose right to exist as a corporation cannot be successfully
challenged by any party, even in a direct action brought by the state for that purpose.
D.Collateral Attack
One in which the existence of a corporation is called into question in a non-legal action with the
deliberate intention of undermining the corporation’s existence.
2. A valid law under which a corporation with assumed powers might be incorporated; a bona fide
attempt to organize a corporation under such law; and the actual use or exercise in good faith of
corporate powers conferred upon it by law are all required for the existence of a de facto corporation
under Section 20.
3.No, a corporation cannot come into existence by mere agreement of the parties, as in the formation of
a general partnership. A corporation is merely a creation of law; its creation requires the state’s
approval. In the Philippines, the formation of a private corporation is governed by the Corporation Code
and the consent of the state is given through the Securities and Exchange Commission (SEC).
4. No, as stated in Section 23, a board of directors is elected by the investors to oversee the
corporation’s management and operations. They are not the corporation’s agents, and so their actions
cannot bind them.
5. An ultra vires act is simply an act that goes beyond a corporation’s conferred powers or the purposes
for which it was formed. Its actions are not necessarily illegal. In contrast, it may be lawful and moral. An
illegal act is an act which is contrary to good customs, law, morals, and public policy and, therefore,
illegal per se, which are things that are inherently lawful.
