You are on page 1of 2

Wesleyan University-Philippines v. Maglaya, Sr.

815 SCRA 171 January 23, 2017 On January 10, 2009, Dr. Dominador Cabasal, Chairman of
the Board, informed the Bishops of the cessation of corporate terms
Petitioner: Wesleyan University-Philippines (WUP) of some of the trustees since the by-laws provided that vacancy shall
Respondent: Guillermo Maglaya, Sr. only be filed by the Bishops upon the recommendation by the
Board. Thereafter, the Bishops appointed the incoming corporate
Topic: Corporate Officer; Court jurisdiction over intra-corporate members and trustees who were formally introduced on April 24,
controversy; Power of Board to appoint and terminate corporate 2009., the new President informed Maglaya of the termination of his
officer service and authority as President of the University on April 27,
2009.
Doctrine: An office is created by the charter of the corporation and
the officer is elected by the directors or stockholders, while an Maglaya and other former member of the Board filed a
employee usually occupies no office and generally is employed not complaint for injunction and damages before the trial court. The RTC
by action of the directors or stockholders but by the managing dismissed the complaint declaring the same as nuisance or
officer of the corporation who also determines the compensation to harassment suit prohibited by Sec. 1(b) Rule 1 of the Interim Rules
be paid to such employee. for Intra-Corporate Controversies. Upon appeal, the CA and the SC
both dismissed the complaint and affirmed decision of RTC.
Facts:
Petitioner is a non-stock, non-profit, nonsectarian Thereafter, Maglaya filed on the present illegal dismissal
educational corporation duly organized and existing under case against WUP with the Labor Arbiter. He claimed that he was a
Philippine law on April 28, 1948. mere employee of the University and was unceremoniously
dismissed in a wanton, reckless, oppressive, and malevolent
Respondent, on the other hand, was an appointed corporate manner.
member since January 1. 2004. He was elected President of the
University for a five-year term on 2005 and was re-elected as a WUP asseverated that the dismissal or removal of Maglaya
trustee on 2007. being a corporate officer and not a regular employee is a corporate
act or intra-corporate controversy under the jurisdiction of the RTC.
In a Memorandum dated November 28, 2008, the
incumbent Bishops of the United Methodist Church (Bishops) LA: In favour of WUP; Since Maglaya was appointed as President of
apprised all the corporate members of the expiration of their terms the University by the Board, he was a corporate officer and not a
on December 31, 2008, unless renewed by the former. The said mere employee. The instant case involves intra- corporate dispute,
members, including Maglaya, sought the renewal of their which was definitely beyond the jurisdiction of the labor tribunal.
membership in the WUP’s Board, and signified their willingness to
serve the corporation.
NLRC: In favor of Maglaya; The illegal dismissal falls within the the officer is by the directors or stockholders must concur in order
jurisdiction of the labor tribunals since the Board did not elect for an individual to be considered a corporate officer, as against an
Maglaya but merely appointed him. ordinary employee or officer. It is only when the officer claiming to
have been illegally dismissed is classified as such corporate officer
Issue: Whether Maglaya is a corporate officer whose complaint for that the issue is deemed an intra-corporate dispute which falls
dismissal should be filed with the trial courts or is he a mere within the jurisdiction of the trial courts.
employee under the jurisdiction of the labor tribunals It is apparent from the bylaws of WUP that the president was one of
the officers of the corporation, and was an honorary member of the
Held: Corporate officer- RTC jurisdiction Board. He was appointed by the Board and not by a managing
officer of the corporation.
The Court ruled that NLRC erred in assuming jurisdiction
over Maglaya’s complaint for illegal dismissal against WUP since the The alleged appointment of Maglaya instead of election as
subject matter of the instant case is an intra-corporate controversy provided by the bylaws neither convert the president of university
which the NLRC has no jurisdiction. as a mere employee, nor amend its nature as a corporate officer. A
corporate officer’s dismissal is always a corporate act, or an intra -
Corporate officer in the context of Presidential Decree No. corporate controversy which arises between a stockholder and a
902-A are those officers of the corporation who are given that corporation, and the nature is not altered by the reason or wisdom
character by the Corporation Code or by the corporation’s bylaws. with which the Board of Directors may have in taking such action.

The president, vice president, secretary and treasurer are The issue of the alleged termination involving a corporate
commonly regarded as the principal or executive officers of a officer, not a mere employee, is not a simple labor problem but a
corporation, and they are usually designated as the officers of the matter that comes within the area of corporate affairs and
corporation. However, other officers are sometimes created by the management and is a corporate controversy in contemplation of the
charter or bylaws of a corporation, or the board of directors may be Corporation Code.
empowered under the bylaws of a corporation to create additional
offices as may be necessary. The Court expounded that an office is Moreover, it is long established rule that jurisdiction over a
created by the charter of the corporation and the officer is elected subject matter is conferred by law. According to Sec.5 (c) of PD 902-
by the directors or stockholders, while an employee usually occupies A as amended by Subsection 5.2, Section 5 of Republic Act No. 8799,
no office and generally is employed not by action of the directors or the regional trial courts exercise exclusive jurisdiction over all
stockholders but by the managing officer of the corporation who controversies in the election or appointment of directors, trustees,
also determines the compensation to be paid to such employee. officers or managers of corporations, partnerships or associations.

From the foregoing, that the creation of the position is


under the corporation’s charter or bylaws, and that the election of

You might also like