Except where the authority of employing servants and agents is expressly vested in the board of

directors or trustees, an officer or agent who has general control and management of the corporation’s
business, or a specific part thereof, may bind the corporation by the employment of such agents and
employees as are usual and necessary in the conduct of such business. But the contracts of
employment must be reasonable. Yu Chuck v. “Kong Li Po,” 46 Phil. 608 (1924).

Under Article 1910 of the New Civil Code, acts done by such officers beyond the scope of their
authority cannot bind the corporation unless it has ratified such acts expressly or tacitly, or is estopped
from denying them. Thus, contracts entered into by corporate officers beyond the scope of
authority are unenforceable against the corporation unless ratified by the Corporation. Woodchild
Holdings, Inc. v. Roxas Electric Constructions Co., Inc., 436 SCRA 235 (2004).

It is the Board of Directors, not the President, that exercises corporate powers. It must be
emphasized that the basis for agency is representation and a person dealing with an agent is put upon
inquiry and must discover upon his peril the authority of the agent. It is familiar doctrine that if a corporation
knowingly permits one of its officers, or any other agent, to act within the scope of an apparent authority, it
holds him out to the public as possessing the power to do those acts; and thus, the corporation will, as against
anyone who has in good faith dealt with it through such agent, be estopped from denying the agent's authority
People’s Aircargo v. Court of Appeals, 297 SCRA 170 (1998).

In conformity with Section 25 of the Corpo Code, whoever are the corporate officers enumerated in the by-laws
are the exclusive officers of the corporation and the Board has no power to create other officers without amending
first the corporate by-laws. However, the Board may create appointive positions other than the positions of the
corporate officers but the persons occupying such position are not considered as corporate officers within the
meaning of Section 25 and are not empowered to exercise the functions of corporate officers except those
functions lawfully delegated to them. Their functioning and duties are to be determined by the Board.
Marc ll v. Joson Dec. 12, 2011

Section 11, Rule 14 of the 1997 Rules of Civil Procedure uses the term “general manager” and
unlike the old provision in the Rules of Court, it does not include the term “agent”. Consequently, the
enumeration of persons to whom summons may be served is “restricted, limited and exclusive”
following the rule on statutory construction expressio unios est exclusion alterius. Therefore, the
earlier cases that uphold service of summons upon a construction project manager; a corporation’s
assistant manager; ordinary clerk of a corporation; private secretary of corporate executives;
retained counsel; officials who had charge or control of the operations of the corporation, like the
assistant general manager;48 or the corporation’s Chief Finance and Administrative Officer; no longer
apply since they were decided under the old rule that allows service of summons upon an agent of
the corporation. E.B. Villarosa & Partners Co., Ltd. v. Benito, 312 SCRA 65 (1999)

The raison d’etre behind the conferment of corporate powers on the Board of Directors is not lost
on the Court – indeed, the concentration in the Board of the powers of control of corporate business
and appointment of corporate officers and managers is necessary for efficiency in any large
organization. Stockholders are too numerous, scattered and unfamiliar with the business of a
corporation to conduct its business directly and so the plan of corporate organization is for the
stockholders to choose the directors who shall control and supervise the conduct of corporate
business. It is within the power of the Board of Directors to authorize any person or committee to undertake
corporate acts. The board has power to constitute even an executive committee, even when no such
committee is provided for in the articles and by-laws of the corporation Filipinas Port Services v. Go, 518 SCRA
453 (2007).
The following officials or employees of the company can sign the verification and certification against forum
shopping without need of a board resolution: (1) the Chairperson of the Board of Directors, (2) the President of a
corporation, (3) the General Manager or Acting General Manager, (4) Personnel Officer, and (5) an Employment
Specialist in a labor case. Cagayan Valley Drug v. CIR Feb. 13, 2008

For stock corporations, the “quorum” referred to in Section 52 of the Corporation Code is based on
the number of outstanding voting stocks. For nonstock corporations, only those who are actual, living
members with voting rights shall be counted in determining the existence of a quorum during
members’ meetings. Dead members shall not be counted. In stock corporations, the presence of a quorum is
ascertained and counted on the basis of the outstanding capital stock, as defined by Section 137 of the
Corporation Code. When the principle for determining quorum for stock corporations is applied by analogy to
nonstock corporations, only those who are actual members with voting rights should be counted. Tan v.
Sycip, 499 SCRA 216 (2006).