TITLE IV.

MEETINGS
Section 52. Quorum In Meetings

SECTION 52:
Unless otherwise provided by for
in this Code or in the by-laws, a
quorum shall consist of the
stockholders representing a majority
of the outstanding capital stock or a
majority of the members in the case
of non-stock corporations.

QUORUM REQUIRED IN STOCKHOLDERSAND

MEMBERSMEETINGS
1.

Number provided in the by-laws

Section 52 does not base the quorum on the meetings of stockholders or
members on their absolute number as fixed in the articles of incorporation.

2.

Number not less than that required by law

These are cases in which the law determines the number or proportion of
shareholders or members whose concurring votes are necessary to make their
action binding on the corporation, not less than such number is necessary to
constitute a quorum at a meeting called to transact such business.

3.

Any number but at least two

In other cases, the by-laws may validly provide for the holding of meetings
with the presence of any number of stockholders or members, even less than
a majority, provided that there are at least two. It is customary, however, to
provide in the by-laws that the presence of the registered holders of a
majority of the outstanding shares is necessary to constitute a quorum, but a
smaller number may meet and adjourn to a later date, and that at such
adjourned meeting the shareholders attending shall constitute a quorum

QUORUM REQUIRED IN STOCKHOLDERSAND

MEMBERSMEETINGS
4.

A majority of outstanding capital stock or members

Section 52 provides that, a majority of the outstanding capital stock or in case
of non-stock corporations, a majority of the members shall constitute a
quorum nless otherwise provided in this Code or in the by-laws.

For non- stock corporations basis for determining the quorum is the
TOTAL NUMBER OF REGISTERED MEMBERS.
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.
The best evidence of who are the present members of a non-stock
corporation is the membership book. For stock corporations, it is
the STOCK AND TRANSFER BOOK.

QUORUM REQUIRED IN STOCKHOLDERSAND

MEMBERSMEETINGS
5.

Where withdrawal leaves less than a quorum previously declared

Once a quorum is present, the affirmative vote of the majority in the

absence of express provision in the by-laws to the contrary and unless the
vote of a greater number is required by law, is sufficient to decide any
question properly presented.

All the stockholders (or members) are bound by the result of such a vote,
and, this, even notwithstanding the withdrawal (after the existence of a
quorum has been determined or declared) of enough shareholders (or
members) to leave less than a quorum.

A minority group cannot prevent corporate action by walking out.

6.

Effect of death of a stockholder or member

In stock corporations shareholders may generally transfer their shares. On

the death of a shareholder, the executor or administrator duly appointed
by the court is vested with the legal title to the stock and entitled to vote.

In non- stock corporations membership in and all rights arising are

personal and non-transferable, unless otherwise provided in the articles of
incorporation or in the by-laws. In other words, the determination of
whether or not dead members are entitled to exercise their voting rights
(through their Executor or Administrator), depends on the articles of
incorporation or in the by-laws.

POSTPONEMENT OF STOCKHOLDERSOR
MEMBERSANNUAL MEETING
Change of date of meeting fixed in by-laws not allowed

1.

GR: That where the date of the annual meeting is fixed in the by-laws of the
corporation, the BOD or Trustees cannot change the date so as to lengthen
their term of office.
Postponement of meeting to a later date when allowed

2.

EXCPN: As where the annual meeting cannot be held on the date fixed by the
by-laws for some valid reason, such as erroneous date for holding the meeting
stated in the notice sent out to members. In such case, the annual meeting
may be postponed to a date later than that fixed by the by-laws, provided
proper notice of the change of date is given to the members. (SEC Opinion,
March 8, 1995)
Holding of meeting within a reasonable time after fixed date

3.

It is the duty of the BOD or Trustees to call the annual meeting without
unnecessary delay or within a reasonable time, particularly when a demand
therefor is made on them by the stockholders or members, because they can
continue to hold over only as long as their successors have not been elected;
hence, it is not within their power to delay such election as to prolong their
stay in the office. (SEC Opinion, Feb. 21, 1968)

PAYMENT OF COMPENSATION FOR ATTENDANCE AT

STOCKHOLDERSOR MEMBERSMEETINGS

Not expressly or impliedly authorized in the Code for the

payment of per diems
Reason: Per Diems connotes payment for services rendered
which cannot be ascribed to the exercise of the right by a
stockholder or member when he attends to a corporate
meeting.
Provision of Section 45(7) of the Corporation Code, which
authorizes by-laws to provide compensation of directors
or trustees, officers, and employees, EXCLUDES
stockholders and members in the enumeration, and this
simply underscores the fact that stockholders or members,
as such, do not render service but exercise rights personal
to themselves in the corporation.

MATTERS IN WHICH THE LAW REQUIRES

MINIMUM NUMBER OF VOTES
Corporate Acts

BOD / Trustees

To amend the articles of

incorporation

To elect
trustees

directors

majority

Stockholders/
Members
Vote or written
assent of 2/3 of
the OCS, or of the
members

Section/s of
Corporate
Code
Sec. 16; Sec.
120

or

majority of OCS or
M entitled to
vote

Sec. 24

To remove directors or
trustees

2/3 of the OCS or

M entitled to
vote

Sec. 28

To call a special meeting

to remove directors or
trustees

Majority of the OCS

or M entitled to
vote

Sec. 28

To ratify a contract of a
director/trustee
or
officer
with
the
corporation

2/3 of the OCS or

M entitled to
vote

Sec. 32

MATTERS IN WHICH THE LAW REQUIRES

MINIMUM NUMBER OF VOTES
Corporate Acts
To extend or
corporate term

BOD / Trustees

shorten

To increase or decrease
the capital stock
To incur, create or
increase
bonded
indebtedness
To sell, lease, exchange,
mortgage, pledge or
otherwise dispose of all
or substantially all of the
corporate assets

Stockholders/Me
mbers

Section/s of
Corporate Code

majority

2/3 of the OCS,

or
of
the
members

Sec. 37

majority

2/3 of the OCS

Sec. 38

majority

2/3 of the OCS

Sec. 38

majority

2/3 of the OCS,

or
of
the
members

Sec. 40

MATTERS IN WHICH THE LAW REQUIRES

MINIMUM NUMBER OF VOTES
Corporate Acts

To invest corporate funds in

another corporation or business
of for any other purpose other
that the primary purpose
To issue stock dividends

To enter
contract

into

To adopt by-laws

management

BOD / Trustees

Stockholders/
Members

majority

2/3 of the OCS, or of

the members

a majority of
the quorum of
BOD

2/3 of the OCS

(including
other
dividends such as
cash
and
bond
dividends)

(The approval of the

Stockholders
is
not
required with respect to
other dividends such as
cash and bond dividends.
They may be declared by a
majority of the quorum of
the board)

a majority of
the quorum of
BOD or trustees

Majority of the OCS,

or of the members of
both the managing
and
managed
corporation
2/3 of the OCS, or of
the members, entitled
to vote, with respect
to
the
managed
corporation

Section/s of
Corporate Code

Sec. 42

Sec. 43

Majority of the OCS,

or of the members

Sec. 44

Sec. 46

MATTERS IN WHICH THE LAW REQUIRES

MINIMUM NUMBER OF VOTES
Corporate Acts

To amend or repeal the bylaws or adopt new by-laws

BOD / Trustees

majority

To delegate to the board of

directors or trustees the
power to amend or repeal
the by-laws or adopt new bylaws
To revoke the preceding
power delegated to the
board of directors or trustees

Stockholders/Memb
ers

Section/s of Corporate
Code

majority

Sec. 48

2/3 of the OCS, or

of the members

Sec. 48

majority

Sec. 48

To fixed issued price of no

par value shares

a majority of the
quorum of BOD, if
authorized by the
articles
of
incorporation

Majority of OCS, in
the absence of such
authority granted to
the BOD

To effect or amend a plan or

merger or consolidation

majority

2/3 of the OCS, or

of the members of
the
constituent
corporation

Sec. 62, last par.

Sec. 77

MATTERS IN WHICH THE LAW REQUIRES

MINIMUM NUMBER OF VOTES
Corporate Acts
To
dissolve
corporation

BOD / Trustees
the

To adopt a plan of
distribution of assets
of
a
non-stock
corporation

majority

majority

Stockholders/
Members

Section/s of
Corporate Code

2/3 of the OCS, or

of the members

Sec. 118, 119

2/3 of the OCS, or

of the members
having voting rights

Sec. 95, par. 2

OTHER POINTS

A corporation may prescribe a greater voting requirement

for the approval of any of the above corporate acts in its
articles of incorporation and/or by-laws in order to
protect the rights of minority stockholders or members.

Any matter or transaction must necessarily fail if the

number of votes attained or cast is less than what is
prescribed for the particular transaction.

If an issue to be resolved requires a majority for it to be

passed and there is a tie, the issue or proposition simply
loses. There is, therefore, no need to break the deadlock.
(SEC Opinion, Aug. 23, 1991; Aug. 4, 1955)