Cagayan Fishing Development Co., Inc. v.

Sandiko

Tabora is the registered owner of parcels of land. To guarantee his loans, he executed three
mortgages on the lands. Then, in consideration of P1, subject to the existing mortgages, Tabora sold
the lands to Cagayan Fishing Development which at the time was still unincorporated. It submitted its
articles of incorporation after about five months.

Then, Cagayan Fishing, through its president, sold the lands to Sandiko, who obligated himself to
shoulder the mortgages. Defendant failed to pay plaintiff. In dismissing plaintiffs complaint, the lower
court held that the sale by Cagayan Fishing to Sandiko was invalid.

ISSUE: WON the transfer by Tabora to Cagayan Fishing was valid.

HELD: No. a corporation until organized has no being. The corporation was not yet incorporated
during the transfer hence it did not have juridical capacity to enter into the contract. Tabora, as mere
promoter of a corporation, could not have acted as an agent for the projected corporation which did
not yet have any legal existence and hence could not yet have an agent.