Terelay Investment and Development Corporation vs. Cecilia Teresita Yulo – On Sufficiency of Ground to Examine Corporate Books and Records
G.R. No. 160924
Another issue resolved by the Supreme Court in this case was whether Yulo has sufficient and valid ground to inspect and examine the corporate books and records of Terelay Investment and Development Corporation.
It is well-settled that the ownership of shares of stock gives stockholders the right under the law to be protected from possible mismanagement by its officers...
The Supreme Court adopted with tapproval the pronouncement of the Court of Appeals, thus:
Verily, petitioner-appellee has presented enough evidence that she is a stockholder of TERELAY. The corporate documents presented support her claim that she is a registered stockholder in TERELAY’s stock and transfer book thus giving her the right, under Section 74 par. 2 and Section 75 of the Philippine Corporation Law, to inspect TERELAY’s books, records, and financial statements.
Accordingly, Cecilia Yulo has the right to be fully informed of TERELAY’s corporate condition and the manner its affairs are being managed. It is well-settled that the ownership of shares of stock gives stockholders the right under the law to be protected from possible mismanagement by its officers. This right is predicated upon self-preservation. In any case, TERELAY did not adduce sufficient proof that Cecilia Yulo was in bad faith or had an ulterior motive in demanding her right under the law.