Law on Business Organizations and Relevant Legal Commercial Relationships

COLLEGE: College of Business DEPARTMENT: Commercial Law

COURSE CODE: BUSLAW2
CLASS DAYS AND CLASS TIME: K35 (TH 6:00 – 7:30) / K36 (TH 7:45-9:00)
INSTRUCTOR: Atty. Leo Angelo M. Larcia
COURSE DESCRIPTION: This is a study of Laws governing Business Organizations such as
Partnerships and Corporations, relevant business transactions such as Agency, among others. The course
will focus on the basic principles provided by these special laws, and the application of these principles to
the various relationships created by these business transactions.

LEARNING OUTCOMES (LO):

At the end of the course, the students will be able to:

I. Knowledge
1. Understand the basic concepts of agency and how it applies in business transactions;
2. Understand the basic legal provisions governing the two major kinds of business
organizations under the law;
3. Distinguish the legal attributes between a partnership and a corporation;
4. Familiarize themselves with the possible legal ramifications of unsound business
practices.

II. Skill/s : Ability to understand and apply legal concepts relating to the law on agency,
partnership and corporation

III. Values
1. Observe at all times honesty, integrity and fair dealings
2. Inculcate the fiduciary duties of management in these business organizations.
3. Be aware of the social responsibility of these business organizations and transactions.

GRADING SYSTEM:
The student will be graded according to the following:
 Recitation and quizzes- 1/3
 Mid-term exams- 1/3
 Final Exams- 1/3

LEARNING TOPIC Week LEARNING

OUTCOME
To know about classroom
rules and policies
To know about the basic
concepts on agency
ACTIVITIES
Course introduction 1
Nature, Form and Kinds of Agency 2 Recitation and Class
(arts. 1868 to 1883) discussion
Obligations of the Agent (arts. 1884 to
1909); Obligations of the Principal
(arts. 1910 to 1918); Modes of
Extinguishment of Agency (arts. 1919
to 1932)
To know the definition of
and the distinctions
between partnerships and
corporations.
To know the nature of
partnership and the
requirements to be
qualified as a partner. The
test to determine the
existence of partnership
and the formalities of
partnership will also be
learned
To know about the
obligations of the partners
in relation to the operation
of the partnership and its
business transactions
To know the rules on
liquidation and winding
up process in the
partnership and the
principles of limited
partnership
Ability to work under time
pressure and working
alone
To know about the nature
and characteristics of a
corporate legal entity
To know about
incorporation and
organization of private
corporations
Partnership and corporation as 3 Recitation and Class
juridical entities and their legal discussion
similarities and differences
Partnership as a contract- who may be
partners; choice of persons and object
Rules to determine whether a
partnership exists
Form of the partnership contract
Partnership as a juridical person and
its commencement and life as an
entity;
Kinds of partnership and partners;
(arts. 1767 – 1783)
Obligations of the partners among 4 Recitation and Class
themselves (arts. 1784 to 1809) discussion
Property rights of a partner (arts. 1810
to 1814)
Obligations of the Partners with 5 Recitation and Class
Regard to third persons (arts. 1815 to discussion
1827)
Liquidation process and winding-up; 6 Lecture and Class
Limited Partnership Discussion
Concept and formalities
Limited partner – capital contribution,
rights and liabilities
Dissolution of limited partnership
Midterm Exams 6th
week
Definition of Corporation, Attributes 7 Recitation and Class
and Characteristics of Corporations; discussion
Different kinds of shares, including
treasury shares, and the attributes of
each (Secs. 1 to 9 and other related
provisions)
Manner of incorporation, Terms of 7-8 Recitation and Class
Corporate Existence, Capital stock, discussion
Corporate Charter, Acquisition of
Juridical Personality; De jure v. De
Facto corporations; Statutory
 requirements of incorporation (Secs. 10
to 22 and other related provisions)
To know about the Powers of the Board of 8 Recitation and Class
corporate powers of the Directors/Trustees and corporate discussion
corporation and how it is officers; Obligations of the board;
exercised Corporate Opportunity Doctrine (Secs.
23 to 35 and other related provisions)
Powers of the corporation; review of 9 Recitation and Class
ultra vires doctrine; concept of discussion
dividends (Secs. 36 to 45 and other
related provisions)
To know about the By- By-Laws; Kinds of Meetings and the 10 Recitation and Class
Laws of the Corporation; requirements for each; Kinds of stocks; discussion
Rights and obligations of stock certificates; stock subscription;
stockholders watered stocks; Corporate books and
records (Secs. 46 to 74 and other
related provisions)
To know about Merger Different forms of corporate 11 Recitation and Class
and Consolidations and combination; procredure; Appraisal discussion
related concepts rights (Secs. 76 to 80; 81 to 86 and other
related provisions)
To know about the Non-stock corporations; close 11 Recitation and Class
different types of corporations; educational corporations; discussion
corporations Religious corporations (Secs. 87 to 95;
96 to 105; 106 to 108; 109 to 116 and
other related provisions)
To know about foreign Foreign corporations; licenses; 12 Recitation and Class
corporations Constitutional limitations on foreign discussion
investment; concept of control;
grandfather rule) (Secs. 123 to 136;
constitutional provisions; cases)
To know about corporate Meaning of dissolution; manner of 12 Recitation and Class
dissolution dissolution and liquidation. discussion
Summary of the three Miscellaneous provisions; Review of 13 Recitation and Class
topics Agency, Partnership and Corporation discussion
Ability to work under time Final Exams (Departmental) 14th
pressure and working week
alone

REFERENCES:

Textbooks:
De Leon, Hector S., The Law on Sales, Agency, and Credit Transactions (2012 Edition or later) –
agency only
De Leon, Hector S., The Law on Partnership and Private Corporations (2012 Edition or later)
CLASS POLICIES:
Oral recitations will be conducted to check if the students are capable of analyzing legal
provisions and principles presented before them. Quizzes, announced or unannounced, may be
given in lieu of oral recitations.

Attendance. Students are expected to come to class diligently and on time. The maximum class
days that a student may be absent is 5 day. 2 occasions of tardiness constitute 1 absence from
class. Absence approved and sanctioned by the University shall not be counted against the
student. However, the student is nevertheless responsible and therefore not excused for missed
class activities, tests and other class requirements.

Written Output. All exams, projects, reports, papers and other written outputs must be
submitted on time or not later than the date and the time specified by the professor. Any
requirement submitted after the specified date and time shall no longer be received and
accepted, and shall get a grade of 0.0.

Respect and Decorum. The students are expected to observe proper decorum and shall give
respect to both his/her professor and classmates.