JULIAN E. TUASON v. LA PREVISORA FILIPINA
G.R. No. L-44579, December 24, 1938
Corporation Law Case Digest by John Paul C. Ladiao (15 March 2016)
(Topic: Consideration for Stocks and Transfer)
Appellee Juan E. Tuason had been a stockholder of the defendant and appellant, La Previsora Filipina, Mutual Building and Loan Association, since 1929, having acquired on different dates shares of stock thereof of the series M and C, at the par value of P200 per share with a guaranteed dividend of 10 per cent. Plaintiff acted as treasurer of defendant corporation from February 27, 1932, up to February 1, 1933. On February 15, 1932, said plaintiff subscribed for 50,000 accumulative shares of series A, paying on account the sum of P5,000, value of twenty-five shares subscribed and paid for by him, which he had exchanged for the equivalent value of the aforesaid accumulative shares in accordance with section 25 of the by-laws of the association. The corresponding certificate of stock, which bears number 8463 (Exhibit 5), had been prepared by defendant corporation and was dated February 15, 1932. On February 19, of the same year, said defendant corporation addressed a letter (Exhibit 4) to plaintiff in which it informed him that the certificate (Exhibit 5) issued by it in his favor for 50,000 accumulative shares of series A, bearing number 8463, remained at his disposal in the office of said defendant where he might get the same when he so desired.
On August 1, 1932, the Collector of Internal Revenue, after an investigation, discovered that defendant had not affixed documentary stamps on the aforesaid certificate No. 8463 in violation of section 1449 (b) of Act No. 2711, for which reason he required defendant to pay P10,000 for documentary stamps (Exhibit 35). In view of said demand, the board of directors of defendant corporation, by resolution of August 4, 1932, agreed to pay the aforesaid amount.
Plaintiff Juan E. Tuason having failed to pay the remaining installments on the price of the 50,000 accumulative shares of series A, defendant corporation, by resolution of its board of directors of November 10, 1932, declared said shares forfeited in December, 1932.
On March 9, 1934, defendant corporation demanded of plaintiff, through the letter Exhibit Q, the reimbursement of the sum paid by it for documentary stamps.
Whether or not plaintiff was bound to reimburse defendant corporation for the value of the documentary stamps which the committee appointed by the Collector of Internal Revenue has affixed to certificate No. 8463 for 50,000 shares of stock issued in the name of said plaintiff?
If the obligation to pay the value of the documentary stamps which were affixed to the certificate of stock — supposing that plaintiff had agreed with defendant corporation to assume the same, which he, however, denies and no authentic evidence in the affirmative has been shown — arises from the existence of said right, upon the latter's disappearance, the former can not exist upon the principle that when there is no cause there can be no effect. When more than one year after, or on April 25, 1934, the committee appointed by the Acting of Internal Revenue affixed to the stub Exhibit B of the said certificate No. 8463 the documentary stamps in question and immediately cancelled them, plaintiff had no longer anything to do with the shares of stock which represented said certificate, and he can not now be made to answer for the payment of their value.
In view of the foregoing, we are of the opinion and so hold: First that the mere making of a certificate of stock in the name of the subscriber thereof by installments and its signing by the officers of a mutual building and loan association, without affixing thereto the corresponding documentary stamps, does not constitute an issue of said certificate, notwithstanding the notice which the secretary of said association might have sent to the said subscriber advising him of its issuance and informing him that said certificate "was at his disposal whenever he desired or had time to get it"; second, that a subscriber of shares of stock in an association is not bound to pay the documentary stamp tax required by law, unless he had agreed with the association to assume payment thereof; and third, that even when there is such an agreement, if before the issuance of the shares of stock the right of the subscriber to the same is declared forfeited, said subscriber is likewise not bound to pay said tax.