RIGHTS OF STOCKHOLDERS IN A DISSOLVED CORPORATION
Dissolution, in whatever manner, of a corporation in the Philippines is a process of terminating its existence under the laws. Once a corporation is dissolved, what is next? Do rights of stockholders still exist? It must be noted that under the Corporation Code of the Philippines, stockholders have the following rights:
- Voting Right;
- Pre-emptive Right;
- Power of inspection of corporate records;
- Right to information;
- Right to dividends; and
- Aprraisal Right
Rights of stockholders does not end just because a corporation has been dissolved. The termination of the life of a juridical entity does not by itself cause the extinction or diminution of the rights and liabilities of such entity nor those of its owners and creditors (Clemente vs. Court of Appeals (G.R. No. 82407 March 27, 1995). Also, in the case of Gokongwei vs. SEC, (G.R. No. L-45911, April 11, 1979), the Supreme Court has explained that the right of inspection of the corporate books and financial records is an incident of the ownership rights of the stockholders over the assets and property of the corporation. It is necessary to afford the stockholder the right of self-protection. Such right exists even if the ownership is beneficial or equitable.
Finally, the Securities and Exchange Commission rendered its opinion (SEC- OGC Opinion No. 16-23, October 5, 2016) regarding the rights of a stockholder in a dissolved corporation by explaining that the right to inspect books and corporate records is based on the principle that “a stockholder has the right to be fully informed of the status and the status of a corporation. It further emphasized that such right can only be exercised for legitimate purpose and should be germane to the interest of the stockholders.
ALL RIGHTS RESERVED.