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Never been a stockholder of the corporation

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Y4 Far From Home: PH second-highest court affirms arrest warrant vs disinherited Yanson daughter, Emily

BACOLOD CITY, Negros Occidental, Philippines – It will be another Christmas far from home for the estranged children of wealthy transport giant founder and matriarch Olivia Yanson after a Court of Appeals division ruled to carry out arrest warrants for perjury and falsification of public documents against her eldest daughter by setting aside a local court’s ruling here and directing it to proceed with the criminal cases against Emily ahead of Christmas 2023.

The 32-page decision, dated 21 October 2023, was penned by Associate Justice Rogelio Largo and concurred in by Associate Justices Jacinto Fajardo, and division chairperson Marilyn Lagura-Yap who reversed and set aside the decision of the Regional Trial Court Branch 45 in two criminal cases against Emily.

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Emily and three other siblings – Roy, Ricardo Jr, and Lourdes Celina – collectively known as the Y4, have been disinherited by their mother, Olivia more, known by her initials OVY or Mommy Love, in her court-supervised will.

OVY also designated her two children, Leo Rey, the youngest, and Ginnette Dumancas, as universal heirs.

Leo Rey or LRY is currently president and chief executive officer of Vallacar Transit Incorporated.

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A release from the Y3 reads in part:

“The MTCC (Municipal Trial Court in Cities) is directed to lift the suspension and to implement the warrants of arrest issued against appellee in Criminal Case Nos. 21-09-36294 to 96 for perjury and Criminal Case No. 21-09-36299 to 301 for falsification of public documents. The MTCC is further directed to continue with the proceedings in the said criminal cases,” according to the decision penned by Associate Justice Rogelio G. Largo.

The case stemmed from the family dispute over the estate of Yanson patriarch Ricardo B. Yanson Sr. who died on October 25, 2015. The Yanson family is divided into two factions, with the first faction composed of Ricardo’s wife Olivia and two of their children—Leo Rey and Ginnette. The other faction is composed of Emily, Roy, Celina and Ricardo Jr.

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The MTCC said Emily Yanson in her capacity as corporate secretary of Ceres Transport made untruthful statements and falsified entries in the 2017, 2018 and 2019 general information sheet (GIS) of the company to state that she and her sister Celina are purportedly stockholders and directors of the company, and that their mother is not a stockholder and director of the company.

According to the CA, Emily could not simply declare herself a stockholder of Ceres Transport, having only as basis the stipulations in the extrajudicial settlement deeds. It said only corporate documents such as the stock transfer book and certificate of stock, among others, can be considered relevant to a claim of stock ownership.

“Let us assume that the RTC will eventually rule in favor of the validity of extrajudicial settlement deeds, which would mean that Olivia’s waiver is valid and appellee is rightfully entitled to the disputed shares. However, this alone will not automatically mean that apellee is a stockholder of the corporation or appellee’s statements in the general information sheets were correct.

The validity of the settlement does not necessarily mean that shares of stock will also be transferred to appellee’s name. Being a corporation, Ceres Transport, has a separate and distinct juridical personality which presupposes that it is governed by law and has its own set of rules and procedures laying down the requisites for one to become a stockholder,” the CA said.

The CA said that Puno v. Puno Enterprisees Inc. teaches that upon the death of a shareholder, the heirs do not automatically become stockholders of the corporation and acquire the rights and privileges of the deceased as shareholder of the corporation. The stocks must be distributed first to the heirs in estate proceedings, and the transfer of the stocks must be recorded in the books of the corporation, it said.

“Therefore, applying these tenets in the present controversy, it is clear that there are legal procedures first to be complied before an individual can rightfully claim his/her status as a stockholder of a corporation. Evidently, even if the extrajudicial settlement deeds are decreed valid, they do not automatically operate to vest upon appellee the right to be considered a stockholder of Ceres Transport. It is only upon a valid transfer of stock on her name that she can be legally considered a stockholder of Ceres Transport,” the CA said.

“Ergo, appellee also cannot simply declare herself a stockholder of Ceres Transport having as basis the stipulations in the extrajudicial settlement deeds because, being a private document, the agreements incorporated therein will only bind the heirs but not the corporation. Only corporate documents such as the stock transfer book and claim of stock ownership, among others, can be considered relevant to a claim of ownership.

“It was clearly premature and erroneous for appellee (Emily) to have declared herself and Celina as stockholders and directors of Ceres Transport because there was not yet a valid transfer of stocks in their names,” the CA said.

“Contrary to the findings of the RTC, we opine that there is a basis for the criminal cases of perjury and falsification of public documents against appellee,” it said.

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Julius D. Mariveles
Julius D. Mariveles
An amateur cook who has a mean version of humba, the author has recently tried to make mole negra, the Mexican sauce he learned by watching shows of master chef Rick Bayless. A journalist since 19, he has worked in the newsrooms of radio, local papers, and Manila-based news organizations. A stroke survivor, he now serves as executive editor of DNX.
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