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    Lim v. Philippine Fishing

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    joyiveeong
    This case involves a collection case filed by Philippine Fishing Gear Industries against Ocean Fishing Corporation and individuals Chua, Yao, and Lim for unpaid fishing gear purchases. Lim argued he should not be liable as he did not sign the contract. The court ruled Lim was liable under the doctrine of corporation by estoppel. This doctrine establishes that all persons who act as a corporation knowing it has no authority, and benefit from transactions, are liable as general partners. Though Lim did not directly act for the corporation, he benefited from the contract between his associates, so is covered by the doctrine of corporation by estoppel.

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    Lim v. Philippine Fishing

    Uploaded by

    joyiveeong
    26 views1 page
    This case involves a collection case filed by Philippine Fishing Gear Industries against Ocean Fishing Corporation and individuals Chua, Yao, and Lim for unpaid fishing gear purchases. Lim argued he should not be liable as he did not sign the contract. The court ruled Lim was liable under the doctrine of corporation by estoppel. This doctrine establishes that all persons who act as a corporation knowing it has no authority, and benefit from transactions, are liable as general partners. Though Lim did not directly act for the corporation, he benefited from the contract between his associates, so is covered by the doctrine of corporation by estoppel.

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    This case involves a collection case filed by Philippine Fishing Gear Industries against Ocean Fishing Corporation and individuals Chua, Yao, and Lim for unpaid fishing gear purchases. Lim argued he should not be liable as he did not sign the contract. The court ruled Lim was liable under the doctrine of corporation by estoppel. This doctrine establishes that all persons who act as a corporation knowing it has no authority, and benefit from transactions, are liable as general partners. Though Lim did not directly act for the corporation, he benefited from the contract between his associates, so is covered by the doctrine of corporation by estoppel.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    26 views1 page

    Lim v. Philippine Fishing

    Uploaded by

    joyiveeong
    This case involves a collection case filed by Philippine Fishing Gear Industries against Ocean Fishing Corporation and individuals Chua, Yao, and Lim for unpaid fishing gear purchases. Lim argued he should not be liable as he did not sign the contract. The court ruled Lim was liable under the doctrine of corporation by estoppel. This doctrine establishes that all persons who act as a corporation knowing it has no authority, and benefit from transactions, are liable as general partners. Though Lim did not directly act for the corporation, he benefited from the contract between his associates, so is covered by the doctrine of corporation by estoppel.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    Lim

    v.
    Philippine Fishing Gear Industries, Inc.
    G.R. No. 136448
    November 3, 1999

    Facts:
    On behalf of “Ocean Fishing Corporation” a contract for the purchase of fishing gears
    was entered into by Chua and Yao who purported themselves to have been engaged in a
    business venture with Lim Tong Lim with the Philippine Fishing Gear. Lim Tong Lim was not
    however a signatory to the contract. The former failed to pay the contract.Philippine Fishing
    Gear filed a collection case against Chua, Yao and Lim Tong Lim in their capacity as general
    partners after SEC issued a certification that Ocean Fishing Corporation is a non-existent
    corporation.Petitioner Lim, argued that he cannot be held liable under the doctrine of
    corporation by estoppel since his name does not appear in the contract and that only Chua and
    Yao should be held liable who dealt in the name of the ostensible corporation.

    Issue: Whether or not petitioner is liable under the doctrine of corporation by estoppel?

    Ruling: Yes.

    Under the doctrine of corporation by estoppel, all persons who assume to act as a
    corporation knowing it to be without authority to do so shall be liable as general partners for all
    debts, liabilities and damages incurred or arising as a result thereof, provided, that, when any
    such ostensible corporation is sued on any transaction entered by it as a corporation or on any
    tort committed by it as such, it shall not be allowed to use as a defense its lack of corporate
    personality. An unincorporated association, which represented itself to be a corporation, will be
    estopped from denying its corporate capacity in a suit against it by a third person who relied in
    good faith on such representation, and it cannot allege lack of personality to be sued to evade
    its responsibility for a contract it entered into and by virtue of which it received advantages and
    benefits. A third party who, knowing an association to be unincorporated, nonetheless treated
    it as a corporation and received benefits from it, may be barred from denying its corporate
    existence in a suit brought against the alleged corporation. In such case, all those who
    benefited from the transaction made by the ostensible corporation, despite knowledge of its
    legal defects, may be held liable for contracts they impliedly assented to or took advantage of.
    In this case, technically, it is true that petitioner did not directly act on behalf of the
    corporation, but having reaped the benefits of the contract entered into by persons withwhom
    he previously had an existing relationship, he is deemed to be part of said association and is
    covered by the scope of the doctrine of corporation by estoppel.

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