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  • 148 - Lumanlan v. Cura

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    The corporation sued Lumanlan to collect unpaid stock subscriptions totaling P13,500 and loans of P1,609. Lumanlan agreed to pay creditors if the corporation only collected 50% of the unpaid stock, but the corporation later tried to collect the full amount. The court ruled that the corporation has the right to collect all unpaid stock subscriptions and other amounts owed to satisfy creditor claims, as stock subscriptions constitute a liability from the time they are made.

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    148_Lumanlan v. Cura

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    The corporation sued Lumanlan to collect unpaid stock subscriptions totaling P13,500 and loans of P1,609. Lumanlan agreed to pay creditors if the corporation only collected 50% of the unpaid stock, but the corporation later tried to collect the full amount. The court ruled that the corporation has the right to collect all unpaid stock subscriptions and other amounts owed to satisfy creditor claims, as stock subscriptions constitute a liability from the time they are made.

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    145 views2 pages

    148 - Lumanlan v. Cura

    Uploaded by

    mimiyuki_
    The corporation sued Lumanlan to collect unpaid stock subscriptions totaling P13,500 and loans of P1,609. Lumanlan agreed to pay creditors if the corporation only collected 50% of the unpaid stock, but the corporation later tried to collect the full amount. The court ruled that the corporation has the right to collect all unpaid stock subscriptions and other amounts owed to satisfy creditor claims, as stock subscriptions constitute a liability from the time they are made.

    Copyright:

    © All Rights Reserved
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    of 2

    TOPIC Enforcement and Payment of Unpaid Subscriptions

    Case Name Bonifacio Lumanlan v. Jacinto Cura


    GR No. GR. No. L-39861
    Facts The appellant is a corporation duly organized under the laws of the Philippine Islands
    with its central office in the City of Manila. Plaintiff Lumanlan subscribed for 300 shares
    of stock of said corporation at a par value of P50 or a total of P15,000. Valenzuela,
    Santos and Escoto, creditors of this corporation, filed suit against it praying that a
    receiver be appointed, as it appeared that the corporation at that time had no assets
    except credits against those who had subscribed for shares of stock.

    As Lumanlan had only paid P1,500 of the P15,000, par value of the stock for which he
    subscribed, the receiver filed a suit against him for the collection of P15,109, P13,500 of
    which was the amount he owed for unpaid stock and P1,609 for loans and advances by
    the corporation to Lumanlan. In that case, Lumanlan was sentenced to pay the
    corporation the above-mentioned sum of P15,109.

    Pending this appeal, the creditors, some of the directors and the majority of the
    stockholders held several meetings in which it was agreed in substance that subscribers
    for the capital stock who were in default should pay the creditors; Lumanlan was
    designated to pay the debt of the corporation to Valenzuela.

    Lumanlan agreed to assume this obligation and in turn the corporation agreed that if
    Lumanlan would dismiss his appeal, the corporation would collect only 50 percent of
    the amount subscribed by him for stock, provided that in case the 50 percent was
    insufficient to pay Valenzuela he should pay an additional amount which should not
    exceed the amount of the judgment against him in that case. Lumanlan withdrew his
    appeal.

    Disregarding this agreement and notwithstanding the payment made by Lumanlan to


    Valenzuela, the corporation asked for the execution of the sentence and by virtue of an
    order of execution the provincial sheriff levied upon two parcels of land belonging to
    Lumanlan. Lumanlan brought this case to collect from Dizon & Co., Inc., and to prevent
    the sheriff from selling the two parcels of land. Pending the result of this case the
    sheriff was enjoined from proceeding with the sale.
    Issue Whether or not the corporation has a right to collect all unpaid stock subscriptions and
    any other amounts which may be due it.
    Ruling YES. It is established doctrine that subscriptions to the capital of a corporation
    constitute a fund to which the creditors have a right to look for satisfaction of their
    claims and that the assignee in insolvency can maintain an action upon any unpaid
    stock subscription in order to realize assets for the payment of its debts.

    Further, the Corporation Law clearly recognizes that a stock subscription is a subsisting
    liability from the time the subscription is made, since it requires the subscriber to pay
    interest quarterly from that date unless he is relieved from such liability by the by-laws
    of the corporation. The subscriber is as much bound to pay the amount of the share
    subscribed by him as he would be to pay any other debt, and the right of the company
    to demand payment is no less incontestable.

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