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    "G" HOLDINGS vs. NAMAWU ET AL DIGEST

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    ruel
    GHI bought 90% of MMC's shares and financial claims, which were converted into promissory notes totaling P500M secured by mortgages over MMC's properties. NAMAWU was the exclusive bargaining agent for MMC's rank-and-file employees. The court ruled that the deed of real estate and chattel mortgage between MMC and GHI was not entered into to evade satisfying legitimate claims against MMC. It found that MMC and GHI maintained separate corporate personalities, as the debt embodied in the promissory notes was established in court. Piercing the corporate veil requires clear evidence that one entity completely dominated the other, which was not found.

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    "G" HOLDINGS vs. NAMAWU ET AL DIGEST

    Uploaded by

    ruel
    34 views2 pages
    GHI bought 90% of MMC's shares and financial claims, which were converted into promissory notes totaling P500M secured by mortgages over MMC's properties. NAMAWU was the exclusive bargaining agent for MMC's rank-and-file employees. The court ruled that the deed of real estate and chattel mortgage between MMC and GHI was not entered into to evade satisfying legitimate claims against MMC. It found that MMC and GHI maintained separate corporate personalities, as the debt embodied in the promissory notes was established in court. Piercing the corporate veil requires clear evidence that one entity completely dominated the other, which was not found.

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    “G” HOLDINGS vs. NAMAWU ET AL DIGEST

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    GHI bought 90% of MMC's shares and financial claims, which were converted into promissory notes totaling P500M secured by mortgages over MMC's properties. NAMAWU was the exclusive bargaining agent for MMC's rank-and-file employees. The court ruled that the deed of real estate and chattel mortgage between MMC and GHI was not entered into to evade satisfying legitimate claims against MMC. It found that MMC and GHI maintained separate corporate personalities, as the debt embodied in the promissory notes was established in court. Piercing the corporate veil requires clear evidence that one entity completely dominated the other, which was not found.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    34 views2 pages

    "G" HOLDINGS vs. NAMAWU ET AL DIGEST

    Uploaded by

    ruel
    GHI bought 90% of MMC's shares and financial claims, which were converted into promissory notes totaling P500M secured by mortgages over MMC's properties. NAMAWU was the exclusive bargaining agent for MMC's rank-and-file employees. The court ruled that the deed of real estate and chattel mortgage between MMC and GHI was not entered into to evade satisfying legitimate claims against MMC. It found that MMC and GHI maintained separate corporate personalities, as the debt embodied in the promissory notes was established in court. Piercing the corporate veil requires clear evidence that one entity completely dominated the other, which was not found.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    “G” HOLDINGS vs.

    NAMAWU ET
    AL DIGEST
    DECEMBER 21, 2016   ~ LEAVE A COMMENT

    G.R. No. 160236               October 16, 2009

    “G” HOLDINGS, INC., Petitioner, 


    vs.
    NATIONAL MINES AND ALLIED WORKERS UNION Local 103
    (NAMAWU); SHERIFFS RICHARD H. APROSTA and ALBERTO MUNOZ,
    all acting Sheriffs; DEPARTMENT OF LABOR AND EMPLOYMENT, Region
    VI, Bacolod District Office, Bacolod City, Respondents.
    FACTS: The petitioner, “G” Holdings, Inc. (GHI), bought ninety percent (90%) of
    MMC’s shares and financial claims. These financial claims were converted into three
    Promissory Notes issued by MMC in favor of GHI totaling P500M and secured by
    mortgages over MMC’s properties. National Mines and Allied Workers Union Local
    103 (NAMAWU), was the exclusive bargaining agent of the rank and file employees
    of Maricalum Mining Corporation (MMC).
    GHI immediately took physical possession of the mine site and its facilities, and took
    full control of the management and operation of MMC.
    Almost four years thereafter, or on August 23, 1996, a labor dispute (refusal to
    bargain collectively and unfair labor practice) arose between MMC and NAMAWU
    ISSUE: WON the Deed of Real Estate and Chattel Mortgage was entered into
    between MMC and G Holdings for the purpose of evading the satisfaction of the
    legitimate claims of the petitioner against MMC.
    HELD: No
    Since the factual antecedents of this case do not warrant a finding that the mortgage
    and loan agreements between MMC and GHI were simulated, then their separate
    personalities must be recognized. To pierce the veil of corporate fiction would require
    that their personalities as creditor and debtor be conjoined, resulting in a merger of the
    personalities of the creditor (GHI) and the debtor (MMC) in one person, such that the
    debt of one to the other is thereby extinguished. But the debt embodied in the 1992
    Financial Notes has been established, and even made subject of court litigation (Civil
    Case No. 95-76132, RTC Manila). This can only mean that GHI and MMC have
    separate corporate personalities.
    Neither was MMC used merely as an alter ego, adjunct, or business conduit for the
    sole benefit of GHI, to justify piercing the former’s veil of corporate fiction so that the
    latter could be held liable to claims of third-party judgment creditors, like NAMAWU.
    Time and again, we have reiterated that mere ownership by a single stockholder or by
    another corporation of all or nearly all of the capital stock of a corporation is not, by
    itself, a sufficient ground for disregarding a separate corporate personality.
    It is basic that a corporation has a personality separate and distinct from that
    composing it as well as from that of any other legal entity to which it may be related.
    Clear and convincing evidence is needed to pierce the veil of corporate fiction.
    In this case, the mere interlocking of directors and officers does not warrant piercing
    the separate corporate personalities of MMC and GHI. Not only must there be a
    showing that there was majority or complete control, but complete domination, not
    only of finances but of policy and business practice in respect to the transaction
    attacked, so that the corporate entity as to this transaction had at the time no separate
    mind, will or existence of its own. The mortgage deed transaction attacked as a basis
    for piercing the corporate veil was a transaction that was an offshoot, a derivative, of
    the mortgages earlier constituted in the Promissory Notes dated October 2, 1992. But
    these Promissory Notes with mortgage were executed by GHI with APT in the name
    of MMC, in a full privatization process. It appears that if there was any control or
    domination exercised over MMC, it was APT, not GHI, that wielded it. Neither can
    we conclude that the constitution of the loan nearly four (4) years prior to
    NAMAWU’s notice of strike could have been the proximate cause of the injury of
    NAMAWU for having been deprived of MMC’s corporate assets.

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