ARTICLES OF INCORPORATION

1. Red Line Transportation Co. vs. Rural Transit Co.

GR No. 41570 | Sept. 6, 1934

Facts:

This is a petition for review of an order of the Public Service Commission granting to the Rural Transit Company,
Ltd., a certificate of public convenience to operate a transportation service between Ilagan in the Province of Isabela and
Tuguegarao in the Province of Cagayan, and additional trips in its existing express service between Manila Tuguegarao.

On June 4, 1932, Rural Transit filed an application for certification of a new service between Tuguegarao and Ilagan
with the Public Company Service Commission (PSC), since the present service is not sufficient

Rural Transit further stated that it is a holder of a certificate of public convenience to operate a passenger bus
service between Manila and Tuguegarao

Red Line opposed said application, arguing that they already hold a certificate of public convenience for
Tuguegarao and Ilagan, and is rendering adequate service. They also argued that granting Rural Transits application
would constitute a ruinous competition over said route

On Dec. 21, 1932, Public Service Commission approved Rural Transits application, with the condition that "all the
other terms and conditions of the various certificates of public convenience of the herein applicant and herein incorporated
are made a part hereof."

A motion for rehearing and reconsideration was filed by Red Line since Rural Transit has a pending application
before the Court of First Instance for voluntary dissolution of the corporation

A motion for postponement was filed by Rural Transit as verified by M. Olsen who swears "that he was the secretary
of the Rural Transit Company, Ltd

During the hearing before the Public Service Commission, the petition for dissolution and the CFIs decision
decreeing the dissolution of Rural Transit were admitted without objection

At the trial of this case before the Public Service Commission an issue was raised as to who was the real party in
interest making the application, whether the Rural Transit Company, Ltd., as appeared on the face of the application, or
the Bachrach Motor Company, Inc., using name of the Rural Transit Company, Ltd., as a trade name

However, PSC granted Rural Transits application for certificate of public convenience and ordered that a certificate
be issued on its name

PSC relied on a Resolution in case No. 23217, authorizing Bachrach Motor to continue using Rural Transits name
as its tradename in all its applications and petitions to be filed before the PSC. Said resolution was given a retroactive
effect as of the date of filing of the application or April 30, 1930

Issue: Can the Public Service Commission authorize a corporation to assume the name of another corporation as a trade
name?

Ruling: NO

The Rural Transit Company, Ltd., and the Bachrach Motor Co., Inc., are Philippine corporations and the very law of
their creation and continued existence requires each to adopt and certify a distinctive name

The incorporators "constitute a body politic and corporate under the name stated in the certificate."

A corporation has the power "of succession by its corporate name." It is essential to its existence and cannot
change its name except in the manner provided by the statute. By that name alone is it authorized to transact business.
 The law gives a corporation no express or implied authority to assume another name that is unappropriated: still
less that of another corporation, which is expressly set apart for it and protected by the law. If any corporation could
assume at pleasure as an unregistered trade name the name of another corporation, this practice would result in
confusion and open the door to frauds and evasions and difficulties of administration and supervision.

In this case, the order of the commission authorizing the Bachrach Motor Co., Incorporated, to assume the name of the
Rural Transit Co., Ltd. likewise incorporated, as its trade name being void. Accepting the order of December 21, 1932, at
its face as granting a certificate of public convenience to the applicant Rural Transit Co., Ltd., the said order last
mentioned is set aside and vacated on the ground that the Rural Transit Company, Ltd., is not the real party in interest and
its application was fictitious

3. PHILIPS EXPORT VS. COURT OF APPEALS- Corporate Trade Name

A corporations right to use its corporate and trade name is a property right, a right in rem, which it may assert and protect
against the whole world.

FACTS:

Philips Export B.V. (PEBV) filed with the SEC for the cancellation of the word Philips the corporate name of Standard
Philips Corporation in view of its prior registration with the Bureau of Patents and the SEC. However, Standard Philips
refused to amend its Articles of Incorporation so PEBV filed with the SEC a petition for the issuance of a Writ of
Preliminary Injunction, however this was denied ruling that it can only be done when the corporate names are identical
and they have at least 2 words different. This was affirmed by the SEC en banc and the Court of Appeals thus the case at
bar.

ISSUE:

Whether or not Standard Philips can be enjoined from using Philips in its corporate name

RULING: YES

A corporations right to use its corporate and trade name is a property right, a right in rem, which it may assert and protect
against the whole world. According to Sec. 18 of the Corporation Code, no corporate name may be allowed if the
proposed name is identical or deceptively confusingly similar to that of any existing corporation or to any other name
already protected by law or is patently deceptive, confusing or contrary to existing law.

For the prohibition to apply, 2 requisites must be present:

(1) the complainant corporation must have acquired a prior right over the use of such corporate name and

(2) the proposed name is either identical or deceptively or confusingly similar to that of any existing corporation or to any
other name already protected by law or patently deceptive, confusing or contrary to existing law.

With regard to the 1st requisite, PEBV adopted the name Philips part of its name 26 years before Standard Philips. As
regards the 2nd, the test for the existence of confusing similarity is whether the similarity is such as to mislead a person
using ordinary care and discrimination. Standard Philips only contains one word, Standard, different from that of PEBV.
The 2 companies products are also the same, or cover the same line of products. Although PEBV primarily deals with
electrical products, it has also shipped to its subsidiaries machines and parts which fall under the classification of chains,
rollers, belts, bearings and cutting saw, the goods which Standard Philips also produce. Also, among Standard Philips
primary purposes are to buy, sell trade x x x electrical wiring devices, electrical component, electrical supplies. Given
these, there is nothing to prevent Standard Philips from dealing in the same line of business of electrical devices. The use
of Philips by Standard Philips tends to show its intention to ride on the popularity and established goodwill of PEBV.

4. Lyceum of the Philippines vs. Court of Appeals

[GR 101897, 5 March 1993]

Facts: Lyceum of the Philippines Inc. had sometime before commenced in the SEC a proceeding (SEC-Case No. 1241)
against the Lyceum of Baguio, Inc. to require it to change its corporate name and to adopt another name not "similar [to]
or identical" with that of petitioner. In an Order dated 20 April 1977, Associate Commissioner Julio Sulit held that the
corporate name of petitioner and that of the Lyceum of Baguio, Inc. were substantially identical because of the presence
of a "dominant" word, i.e., "Lyceum," the name of the geographical location of the campus being the only word which
distinguished one from the other corporate name. The SEC also noted that Lyceum of the Philippines Inc. had registered
as a corporation ahead of the Lyceum of Baguio, Inc. in point of time, and ordered the latter to change its name to another
name "not similar or identical [with]" the names of previously registered entities. The Lyceum of Baguio, Inc. assailed the
Order of the SEC before the Supreme Court (GR L-46595). In a Minute Resolution dated 14 September 1977, the Court
denied the Petition for Review for lack of merit. Entry of judgment in that case was made on 21 October 1977.

Armed with the Resolution of the Supreme Court, the Lyceum of the Philippines then wrote all the educational institutions
it could find using the word "Lyceum" as part of their corporate name, and advised them to discontinue such use of
"Lyceum." When, with the passage of time, it became clear that this recourse had failed, and on 24 February 1984,
Lyceum of the Philippines instituted before the SEC SEC-Case 2579 to enforce what Lyceum of the Philippines claims as
its proprietary right to the word "Lyceum." The SEC hearing officer rendered a decision sustaining petitioner's claim to an
exclusive right to use the word "Lyceum." The hearing officer relied upon the SEC ruling in the Lyceum of Baguio, Inc.
case (SEC-Case 1241) and held that the word "Lyceum" was capable of appropriation and that petitioner had acquired an
enforceable exclusive right to the use of that word. On appeal, however, by Lyceum Of Aparri, Lyceum Of Cabagan,
Lyceum Of Camalaniugan, Inc., Lyceum Of Lallo, Inc., Lyceum Of Tuao, Inc., Buhi Lyceum, Central Lyceum Of
Catanduanes, Lyceum Of Southern Philippines, Lyceum Of Eastern Mindanao, Inc. and Western Pangasinan Lyceum,
Inc.,, which are also educational institutions, to the SEC En Banc, the decision of the hearing officer was reversed and set
aside. The SEC En Banc did not consider the word "Lyceum" to have become so identified with Lyceum of the Philippines
as to render use thereof by other institutions as productive of confusion about the identity of the schools concerned in the
mind of the general public. Unlike its hearing officer, the SEC En Banc held that the attaching of geographical names to
the word "Lyceum" served sufficiently to distinguish the schools from one another, especially in view of the fact that the
campuses of Lyceum of the Philippines and those of the other Lyceums were physically quite remote from each other.
Lyceum of the Philippines then went on appeal to the Court of Appeals. In its Decision dated 28 June 1991, however, the
Court of Appeals affirmed the questioned Orders of the SEC En Banc. Lyceum of the Philippines filed a motion for
reconsideration, without success. Lyceum of the Philippines filed the petition for review.

Issue:

1. Whether the names of the contending Lyceum schools are confusingly similar.

2. Whether the use by the Lyceum of the Philippines of "Lyceum" in its corporate name has been for such length of time
and with such exclusivity as to have become associated or identified with the petitioner institution in the mind of the
general public (or at least that portion of the general public which has to do with schools).

Held:

1. The Articles of Incorporation of a corporation must, among other things, set out the name of the corporation. Section 18
of the Corporation Code establishes a restrictive rule insofar as corporate names are concerned. It provides that "No
corporate name may be allowed by the Securities an Exchange Commission if the proposed name is identical or
deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law or is
patently deceptive, confusing or contrary to existing laws. When a change in the corporate name is approved, the
Commission shall issue an amended certificate of incorporation under the amended name." The policy underlying the
prohibition in Section 18 against the registration of a corporate name which is "identical or deceptively or confusingly
similar" to that of any existing corporation or which is "patently deceptive" or "patently confusing" or "contrary to existing
laws," is the avoidance of fraud upon the public which would have occasion to deal with the entity concerned, the evasion
of legal obligations and duties, and the reduction of difficulties of administration and supervision over corporations. Herein,
the Court does not consider that the corporate names of the academic institutions are "identical with, or deceptively or
confusingly similar" to that of Lyceum of the Philippines Inc.. True enough, the corporate names of the other schools
(defendant institutions) entities all carry the word "Lyceum" but confusion and deception are effectively precluded by the
appending of geographic names to the word "Lyceum." Thus, the "Lyceum of Aparri" cannot be mistaken by the general
public for the Lyceum of the Philippines, or that the "Lyceum of Camalaniugan" would be confused with the Lyceum of the
Philippines. Further, etymologically, the word "Lyceum" is the Latin word for the Greek lykeion which in turn referred to a
locality on the river Ilissius in ancient Athens "comprising an enclosure dedicated to Apollo and adorned with fountains and
buildings erected by Pisistratus, Pericles and Lycurgus frequented by the youth for exercise and by the philosopher
Aristotle and his followers for teaching." In time, the word "Lyceum" became associated with schools and other institutions
providing public lectures and concerts and public discussions. Thus today, the word "Lyceum" generally refers to a school
or an institution of learning. Since "Lyceum" or "Liceo" denotes a school or institution of learning, it is not unnatural to use
this word to designate an entity which is organized and operating as an educational institution. To determine whether a
given corporate name is "identical" or "confusingly or deceptively similar" with another entity's corporate name, it is not
enough to ascertain the presence of "Lyceum" or "Liceo" in both names. One must evaluate corporate names in their
entirety and when the name of Lyceum of the Philippines is juxtaposed with the names of private respondents, they are
not reasonably regarded as "identical" or "confusingly or deceptively similar" with each other.

2. The number alone of the private respondents in the present case suggests strongly that the Lyceum of the Philippines'
use of the word "Lyceum" has not been attended with the exclusivity essential for applicability of the doctrine of secondary
meaning. It may be noted also that at least one of the private respondents, i.e., the Western Pangasinan Lyceum, Inc.,
used the term "Lyceum" 17 years before Lyceum of the Philippines registered its own corporate name with the SEC and
began using the word "Lyceum." It follows that if any institution had acquired an exclusive right to the word "Lyceum," that
institution would have been the Western Pangasinan Lyceum, Inc. rather than Lyceum of the Philippines. Hence, Lyceum
of the Philippines is not entitled to a legally enforceable exclusive right to use the word "Lyceum" in its corporate name
and that other institutions may use "Lyceum" as part of their corporate names.

Universal Mills Corporation vs. Universal Textile Mills

78 SCRA 62 (1977)

FACTS:

This is an appeal from the order of the Securities and Exchange Commission granting a petition by the
respondent to have the petitioners corporate name be changed as it is confusingly and deceptively similar to
that of the former.

On January 8, 1954, respondent Universal Textile Mills was issued a certificate of Corporation as a textile
manufacturing firm. On the other hand, petitioner, which deals in the production of hosieries and apparels,
acquired its current name by amending its articles of incorporation, changing its name from Universal Hosiery
mills Corporation to Universal Mills corporation.

ISSUE:

Whether or not petioners trade name is confusingly similar with that of respondents.

HELD:

Yes. The corporate names in question are not identical, but they are indisputably so similar that even under the
test of reasonable care and observation as the public generally are capable of using and may be expected to
exercise invoked by appellant. We are apprehensive confusion will usually arise, considering that x x x
appellant included among its primary purposes the manufacturing, dyeing, finishing and selling of fabrics of all
kinds which respondent had been engaged for more than a decade ahead of petitioner.

PRINCIPAL PLACE OF BUSINESS

1. HYATT ELEVATORS AND ESCALATORS CORPORATION v GOLDSTAR ELEVATORS, PHILS. October 24, 2005 |
Panganiban, J. | Certiorari | Venue Venue of Personal Actions

PETITIONER: Hyatt Elevators and Escalators Corporation

RESPONDENT: Goldstar Elevators, Phils., Inc.

SUMMARY: A case for unfair trade practices was filed by HYATT against GOLDSTAR. Both were corporations dealing
with elevators. The case was filed in Mandaluyong despite both have their principal office located in Makati. GOLDSTAR
filed a motion to dismiss on the ground of improper venue. The court held that it is clear in the Civil Code and the
Corporation Code that in matters of venue, residence shall be considered synonymous as domicile which shall be
understood to be the place where their legal representation is established or where they exercise their principal functions.
This matter was also settled by jurisprudence.

DOCTRINE: It is a well established rule that the residence of a corporation is the place where its principal office is located,
as stated in its Articles of Incorporation.

FACTS:

1. Both parties are engaged in the same business of selling installing and maintaining/servicing elevators and escalators.
On February 23, 1999, HYATT filed a complaint for unfair trade practices and damages unther Articles 19, 20 and 21 of
the Civil Code of the Philippines against LG industrial Systems Co. Ltd (LGISC) and LG International Corporation (LGIC),
alleging that in 1988, HYATT was appointed by LGISC and LGIC as the exclusive distributor of LG elevators in the
Philippines under a Distributorship Agreement. In the latter part of 1996, LGISC made a proposal to change the
Distributorship Agreement to that of the joint venture, however HYATT allege that the representatives of LGISC and LGIC
conducted the meeting in bad faith in order to put pressures upon them and eventually terminated the Exclusive
Distributorship Agreement.

2. LGISC and LGIC filed a Motion to Dismiss on the following grounds: (1) lack of jurisdiction over the persons of
defendants, summons not having been served on its resident agent; (2) improper venue; and (3) failure to state a cause of
action.

3. HYATT then filed a motion for leave of court to amend the complaint when it learned that LGISC was to be substituted
to LG Otis because of the latter succeeding the former. THe motion also averred that Goldstar was being utilized by LG
OTIS and LGIC in perpetrating their unlawful and unjustified acts against HYATT. Goldstar was additionally impleaded as
a party-defendant.

4. Goldstar filed a Motion to Dismiss the amended complaint, raising the following grounds: (1) the venue was improperly
laid, as neither HYATT nor defendants reside in Mandaluyong City, where the original case was filed, and (2) failure to
state a cause of action agains (respondent), since the amended complaint fails to allege with certainty what specific
ultimate acts GOLDSTAR performed in violation of HYATTs rights.

5. Trial court dismiss the motion. Goldstar filed a MR but the same was dismissed. CA reversed RTC and declared that
the venue was clearly improper, because none of the litigants resided in Mandaluyong City, where the case was filed.

ISSUE:

1. WoN the venue (Mandaluyong) was improper YES.

RULING: Petition DENIED.

RATIO:

1. Sec 2 Rule 4 of the 1997 Revised Rules of Court states tgat Venue of personal actions all other actions may be
commenced and tried where the plaintiff resides, or where the defendant or any of the principal defendant resides, or in
the case of a non-resident defendant where he may be found, at the election of the plaintiff.

2. But since both parties to this case are corporations, there is a need to clarify the meaning of residence. The law
recognize two types of persons: (1) Natural and (2) juridical. Corporations fall under juridical. A corporation, however, has
no residence1 in the same sense in which this term is applied to a natural person.

1
Residence is the permanent home---the place to which, whenever absent for business or pleasure, one
intends to return
3. In the case Young Auto Supply Company v Court of Appelas, the court ruled that for practical purposes, a corporation
is in a metaphysical sense a resident of the place where its principal office is located as stated in the articles of
incorporation. But even before this ruling, it has been already established that the residence of a corporation is the place
where its principal office is established.

4. The court held that in the purpose of venue, residence is the same with domicile. Correspondingly the Civil Code
provides: Art 51. When the law creating or recognizing them, or any other provision does not fix the domicile of juridical
persons, the same shall be understood to be the place where their legal representation is established or where they
exercise their principal functions. AND Under Section 14(3) of the Corporation Code, the place where the principal office
of the corporation is to be located is one of the required contents of the articles of incorporation, which shall be filed with
the Securities and Exchange Commission (SEC).

5. In the present case, there is no question as to the residence of respondent. What needs to be examined is that of
petitioner. Admittedly, the latters principal place of business is Makati, as indicated in its Articles of Incorporation. Since
the principal place of business of a corporation determines its residence or domicile, then the place indicated in
petitioners articles of incorporation becomes controlling in determining the venue for this case.

6. HYATT argues that the Rules of Court did not provide that when the plaintiff is a corporation, the complaint should be
filed in the location of its principal office as indicated in its articles of incorporation. This is however settled by
jurisprudence.

7. The choice of venue should not be left to the plaintiffs whim or caprice. He may be impelled by some ulterior
motivation in choosing to file a case in a particular court even if not allowed by the rules on venue.