MERRILL LYNCH FUTURES, INC., PETITIONER, VS. HON. COURT OF APPEALS, AND THE SPOUSES PEDRO M. LARA AND ELISA G. LARA, RESPONDENTS.

The capacity of a foreign corporation to maintain an action in
the Philippines against residents thereof, is the principal question in the
appellate proceedings at bar. The issue
arises from the undisputed facts now to be briefly narrated.

On November 23, 1987, Merrill Lynch Futures, Inc. (hereafter,
simply ML FUTURES) filed a complaint with the Regional Trial Court at Quezon
City against the Spouses Pedro M. Lara and Elisa G. Lara for the recovery of a
debt and interest thereon, damages, and attorney’s fees.^[1]
In its complaint ML FUTURES described itself as –

a) “a non-resident foreign corporation, not doing business in
the Philippines, duly organized and existing under and by virtue of the laws of
the state of Delaware, U.S.A.;” as well as

b) a ‘futures commission merchant’ duly licensed to act as such in
the futures markets and exchanges in the United States, * * essentially
functioning as a broker ** (executing) orders to buy and sell futures contracts
received from its customers on U.S. futures exchanges.”

It also defined a “futures contract” as a
“contractual commitment to buy and sell a standardized quantity of a
particular item at a specified future settlement date and at a price agreed
upon, with the purchase or sale being executed on a regulated futures
exchange.”

In its complaint ML FUTURES alleged the following:

1) that on September 28, 1983 it entered into a Futures Customer
Agreement with the defendant spouses (Account No. 138-­12161), in virtue of which it agreed to act as the
latter’s broker for the purchase and sale of futures contracts in the U.S.;

2) that pursuant to the contract, orders to buy and sell futures
contracts were transmitted to ML FUTURES by the Lara Spouses “through the
facilities of Merrill Lynch Philippines, Inc., a Philippine corporation and a
company servicing plaintiff’s customers;”^[2]

3) that from the outset, the Lara Spouses “knew and were duly
advised that Merrill Lynch Philippines, Inc. was not a broker in futures
contracts,” and that it “did not have a license from the Securities
and Exchange Commission to operate as a commodity trading advisor (i.e., ‘an
entity which, not being a broker, furnishes advice on commodity futures to
persons who trade in futures contracts’);

4) that in line with the above mentioned agreement and through
said Merrill Lynch Philippines, Inc., the Lara Spouses actively traded in
futures contracts, including “stock index futures” for four years or
so, i.e., from 1983 to October, 1987,^[3]
there being more or less regular accounting and corresponding remittances of
money (or crediting or debiting) made between the spouses and ML FUTURES;

5) that because of a loss amounting to US$160,749.69 incurred in
respect of three (3) transactions
involving “index futures,” and after setting this off against an
amount of US$75,913.42 then owing by ML FUTURES to the Lara Spouses, said
spouses became indebted to ML FUTURES for the ensuing balance of US$84,836.27,
which the latter asked them to pay;

6) that the Lara Spouses however refused to pay this balance,
“alleging that the transactions were null and void because Merrill Lynch
Philippines, Inc., the Philippine company servicing accounts of plaintiff, **
had no license to operate as a ‘commodity and/or financial futures
broker.’”

On the foregoing essential facts, ML FUTURES prayed (1) for a
preliminary attachment against defendant spouses’ properties “up to the
value of at least P2,267,139.50,” and (2) for judgment, after trial,
sentencing the spouses to pay ML FUTURES:

a) the Philippine
peso equivalent of $84,836.27 at the applicable exchange rate on date of
payment, with legal interest from date of demand until full payment;

b) exemplary damages in the sum of at least P500,000.00; and

c) attorney’s fees and expenses of litigation as may be proven at
the trial.

Preliminary attachment issued ex parte on December 2,
1987, and the defendant spouses were duly served with summons.

They then filed a motion to dismiss dated December 18, 1987 on
the grounds that:

(1) plaintiff ML FUTURES had “no legal capacity to sue”
and

(2) its “complaint states no cause of action since ** (it) is
not the real party in interest.”

In that motion to dismiss, the defendant spouses averred that:

a) although not licensed to do so, ML FUTURES had been doing
business in the Philippines “at least for the last four (4) years,”
this being clear from the very allegations of the complaint; consequently, ML
FUTURES is prohibited by law “to maintain or intervene in any action, suit
or proceeding in any court or administrative agency of the Philippines;”
and

b) they had never been informed that Merrill Lynch Philippines,
Inc. was not licensed to do business in this country; and contrary to the
allegations of the complaint, all their transactions had actually been with
MERRILL LYNCH PIERCE FENNER & SMITH, INC., and not with ML FUTURES
(Merrill Lynch Futures, Inc.), in proof of which they attached to their motion
to dismiss copies of eight (8) agreements, receipts or reminders, etc., executed on standard printed forms of said
Merrill Lynch Pierce Fenner & Smith Inc.^[4]

ML FUTURES filed an OPPOSITION to the defendant spouses’ motion
to dismiss. In that motion –

a) it drew attention to paragraph 4 of its
complaint, admitted by defendants, that the latter “have been actively
trading in futures contracts ** in U.S. futures exchanges from 1983 to
1987,” and ask, “If the trading ** (was) made in U.S., how could
plaintiff be doing business in the Philippines?”

b) it also drew attention to a printed form of
“Merrill Lynch Futures, Inc.” filled out and signed by defendant
spouses when they opened an account with ML Futures, in order to supply
information about themselves, including their bank’s name —

(1) in which appear
the following epigraph: “Account introduced by Merrill Lynch
International, Inc.,” and the following statements, to wit::

“This Commodity Trading Advisor (Merrill Lynch, Pierce, Fenner
& Smith Philippines, Inc.) is prohibited by the Philippine Securities and
Exchange Commission from accepting funds in the trading advisor’s name from a
client of Merrill Lynch Futures, Inc. for trading commodity interests. All funds in this trading program must be
placed with Merrill Lynch Futures, Inc.;”

and

“ * * It is agreed between MERRILL LYNCH, PIERCE, FENNER &
SMITH INC., and other account carrying MERRILL LYNCH entities and their
customers that all legal relationships between them will be governed by
applicable laws in countries outside the Philippines where sale and purchase
transactions take place.”

c) and it argued that ?

(1) it is not
permitted for defendant spouses to present “evidence” in connection
with a motion to dismiss based on failure of the complaint to state a cause of
action;

(2) even if the
documents appended to the motion to dismiss be considered as admissible
“evidence,” the same would be immaterial since the documents refer to
a different account number: 138-12136, the defendants’ account number
with ML FUTURES being 138-12161;

(3) it is a lie for
the defendant spouses to assert that they were never informed that Merrill
Lynch Philippines, Inc. had not been licensed to do business in the
Philippines; and

(4) defendant
spouses should not be allowed to “invoke the aid of the court with unclean
hands.”

The defendant spouses filed a REPLY reaffirming their lack of
awareness that Merrill Lynch Philippines, Inc. (formerly registered as
Merrill Lynch, Pierce, Fenner & Smith Philippines, Inc.)^[5]
did not have a license, claiming that they learned of this only from inquiries
with the Securities & Exchange Commission which elicited the information
that it had denied said corporation’s application to operate as a commodity
futures trading advisor — a denial subsequently affirmed by the Court of
Appeals (Merrill Lynch Philippines, Inc. v. Securities & Exchange
Commission, CA-G.R. No. 10821-SP, Nov. 19, 1987). The spouses also submitted additional
documents (Annexes J to R) involving transactions with Merrill Lynch Pierce
Fenner & Smith, Inc., dating back to 1980, stressing that all but one of
the documents “refer to Account No. 138-12161 which is the very account that
is involved in the instant complaint.”

ML FUTURES filed a Rejoinder alleging it had given the spouses a
disclosure statement by which the latter were made aware that the transactions
they were agreeing on would take place outside of the Philippines, and that
“all funds in the trading program must be placed with Merrill Lynch
Futures, Inc.”

On January 12, 1988, the Trial Court promulgated an Order
sustaining the motion to dismiss, directing the dismissal of the case and
discharging the writ of preliminary attachment. It later denied ML FUTURES’s motion for reconsideration, by Order
dated February 29, 1988. ML FUTURES
appealed to the Court of Appeals.^[6]

In its own decision promulgated on November 27, 1990,^[7]
the Court of Appeals affirmed the Trial Court’s judgment. It declared that the Trial Court had seen
“through the charade in the representation of MLPI and the plaintiff that
MLPI is only a trading advisor and in fact it is a conduit in the plaintiff’s
business transactions in the Philippines as a basis for invoking the provisions
of Section 133 of the Corporation Code,”^[8]
viz.:

“SEC. 133.- Doing business without a license. – No
foreign corporation transacting business in the Philippines without a license,
or its successors or assigns, shall be permitted to maintain or intervene in
any action, suit or proceeding in any court or administrative agency in the
Philippines; but such corporation may be sued or proceeded against before
Philippine courts or administrative tribunals on any valid cause of action recognized
under Philippine laws.”

It also declared that the evidence
established that plaintiff had in fact been “doing business” in this
country in legal contemplation, adverting to Mentholatum v. Mangaliman,
72 Phil. 524, 528-530, and Section 1 of Republic Act No. 5455 reading as
follows:^[9]

“SEC. 1. Definition and scope of this ACT. (1) As used
in this Act, the term ‘investment’ shall mean equity participation in any
enterprise formed, organized, or existing under the laws of the Philippines;
and the phrase ‘doing business’ shall INCLUDE soliciting orders, purchases,
service contracts, opening offices, whether called ‘liaison’ offices or
branches; appointing representatives or distributors who are domiciled
in the Philippines or who in any calendar year stay in the Philippines for a
period or periods totalling one hundred eighty days or more; participating
in the management, supervision or control of any domestic business firm, entity
or corporation in the Philippines; AND ANY OTHER ACT OR ACTS THAT IMPLY A CONTINUITY
OF COMMERCIAL DEALINGS OR ARRANGEMENTS AND CONTEMPLATE TO THAT EXTENT THE
PERFORMANCE OF ACTS OR WORKS, OR THE EXERCISE OF SOME FUNCTIONS NORMALLY
INCIDENT TO, AND IN PROGRESSIVE PROSECUTION OF COMMERCIAL GAIN OR OF THE
PURPOSE AND OBJECT OF THE BUSINESS ORGANIZATION.”

As regards the claim that it was error for the Trial Court to
place reliance on the decision of the Court of Appeals in CA-G.R.No. 10821-SP
— sustaining the finding of the Securities & Exchange Commission that ML
FUTURES was doing business in the Philippines — since that judgment was not
yet final and ML FUTURES was not a party to that proceeding, the Court of
Appeals ruled that there was no need to belabor the point considering that
there was, in any event, “adequate proof of the activities of MLPI ***
which manifestly show that the plaintiff (ML FUTURES) performed a series of
business acts, consummated contracts and undertook transactions for the period
from 1983 to October 1987,” and because ML FUTURES had done so without
license, it consequently had “no legal personality to bring suit in
Philippine courts.”

Its motion for reconsideration having been denied,^[10]
ML FUTURES has appealed to this Court on certiorari. Here, it submits the following issues for
resolution:

“(a) Whether or not the annexes appended by the
Laras to their Motion to Dismiss and Reply filed with the Regional Trial Court,
but never authenticated or offered, constitute admissible evidence.

(b) Whether or not in the proceedings below, ML
FUTURES has been accorded procedural due process.

(c) Whether or not the annexes, assuming them
to be admissible, established that ML FUTURES was doing business in the
Philippines without a license.”

As just stated, the Lara Spouses’ motion to dismiss was founded
on two (2) grounds: (a) that the
plaintiff has no legal capacity to sue, and (b) that the complaint states no
cause of action (Sec. 1 [d], and [g], Rule 16, Rules of Court).

As regards the second ground, i.e., that the complaint states no
cause of action, the settled doctrine of course is that said ground must appear
on the face of the complaint, and its existence may be determined only by the
allegations of the complaint, consideration of other facts being proscribed,
and any attempt to prove extraneous circumstances not being allowed.^[11]
The test of the sufficiency of the facts alleged in a complaint as constituting
a cause of action is whether or not, admitting the facts alleged, the court
might render a valid judgment upon the same in accordance with the prayer of
the complaint.^[12]
Indeed, it is error for a judge to conduct a preliminary hearing and receive
evidence on the affirmative defense of failure of the complaint to state a
cause of action.^[13]

The other ground for dismissal relied upon, i.e., that the
plaintiff has no legal capacity to sue — may be understood in two
senses: one, that the plaintiff is
prohibited or otherwise incapacitated by law to institute suit in Philippine
Courts,^[14]
or two, although not otherwise incapacitated in the sense just stated, that it
is not a real party in interest.^[15]
Now, the Lara Spouses contend that ML Futures has no capacity to sue them
because the transactions subject of the complaint were had by them, not with
the plaintiff ML FUTURES, but with Merrill Lynch Pierce Fenner & Smith,
Inc. Evidence is quite obviously
needed in this situation, for it is not to be expected that said ground, or any
facts from which its existence may be inferred, will be found in the averments
of the complaint. When such a ground is
asserted in a motion to dismiss, the general rule governing evidence on motions
applies. The rule is embodied in
Section 7, Rule 133 of the Rules of Court.

“SEC. 7. Evidence on motion. –When a motion is based
on facts not appearing of record the court may hear the matter on affidavits or
depositions presented by the respective parties, but the court may direct that
the matter be heard wholly or partly on oral testimony or depositions.”

There was, to be sure, no affidavit or deposition attached to the
Lara Spouses’ motion to dismiss or thereafter proffered in proof of the
averments of their motion. The motion
itself was not verified. What the
spouses did do was to refer in their motion to documents which purported to
establish that it was not with ML FUTURES that they had theretofore been
dealing, but another, distinct entity, Merril Lynch, Pierce, Fenner &
Smith, Inc., copies of which documents were attached to the motion. It is significant that ML FUTURES raised no
issue relative to the authenticity of the documents thus annexed to the Laras’
motion. In fact, its arguments subsumed
the genuineness thereof and even adverted to one or two of them. Its objection was centered on the propriety
of taking account of those documents as evidence, considering the established
principle that no evidence should be received in the resolution of a motion to
dismiss based on an alleged failure of the complaint to state a cause of
action.

There being otherwise no question respecting the genuineness of
the documents, nor of their relevance to at least one of the grounds for
dismissal — i.e., the prohibition on suits in Philippine Courts by foreign
corporations doing business in the country without license — it would have
been a superfluity for the Court to require prior proof of their authenticity,
and no error may be ascribed to the Trial Court in taking account of them in
the determination of the motion on the ground, not that the complaint fails
to state a cause of action — as regards which evidence is improper and impermissible
— but that the plaintiff has no legal capacity to sue — respecting which proof may and should be
presented.

Neither may ML FUTURES argue with any degree of tenability that
it had been denied due process in the premises. As just pointed out, it was very clear from the outset that the
claim of lack of its capacity to sue was being made to rest squarely on the
documents annexed thereto, and ML FUTURES had more than ample opportunity to
impugn those documents and require their authentication, but did not do
so. To sustain its theory that there
should have been identification and authentication, and formal offer, of those
documents in the Trial Court pursuant to the rules of evidence would be to give
unwarranted importance to technicality and make it prevail over the substance
of the issue.

The first question then, is, as ML FUTURES formulates it, whether
or not the annexes, assuming them to be admissible, establish that (a) ML
FUTURES is prohibited from suing in Philippine Courts because doing business in
the country without a license, and that (b) it is not a real party in interest
since the Lara Spouses had not been doing business with it, but with another
corporation, Merrill Lynch, Pierce, Fenner & Smith, Inc.

The Court is satisfied that the facts on record adequately
establish that ML FUTURES, operating in the United States, had indeed done
business with the Lara Spouses in the Philippines over several years, had done
so at all times through Merrill Lynch Philippines, Inc. (MLPI), a corporation
organized in this country and had executed all these transactions without ML
FUTURES being licensed to so transact business here, and without MLPI being
authorized to operate as a commodity futures trading advisor. These are the factual findings of both the
Trial Court and the Court of Appeals. These, too, are the conclusions of the Securities & Exchange
Commission which denied MLPI’s application to operate as a commodity futures
trading advisor, a denial subsequently affirmed by the Court of Appeals. Prescinding from the proposition that factual
findings of the Court of Appeals are generally conclusive, this Court has been
cited to no circumstance of substance to warrant reversal of said Appellate
Court’s findings or conclusions in this case.

The Court is satisfied, too, that the Laras did transact business
with ML FUTURES through its agent corporation organized in the Philippines, it
being unnecessary to determine whether this domestic firm was MLPI (Merrill
Lynch Philippines, Inc.) or Merrill Lynch Pierce Fenner & Smith, (MLPI’s
alleged predecessor). The fact is that
ML FUTURES did deal with futures contracts in exchanges in the United States in
behalf and for the account of the Lara Spouses, and that on several occasions
the latter received account documents and money in connection with those
transactions.

Given these facts, if indeed the last transaction executed by ML
FUTURES in the Lara’s behalf had resulted in a loss amounting to US
$160,749.69; that in relation to this loss, ML FUTURES had credited the Laras
with the amount of US$ 75,913.42 — which it (ML FUTURES) then admittedly owed
the spouses — and thereafter sought to collect the balance, US$84,836.27, but
the Laras had refused to pay (for the reasons already above stated), the
crucial question is whether or not ML FUTURES may sue in Philippine Courts to
establish and enforce its rights against said spouses, in light of the
undeniable fact that it had transacted business in this country without being
licensed to do so. In other words, if it
be true that during all the time that they were transacting with ML FUTURES,
the Laras were fully aware of its lack of license to do business in the
Philippines, and in relation to those transactions had made payments to, and
received money from it for several years, the question is whether or not the
Lara Spouses are now estopped to impugn ML FUTURES’ capacity to sue them in the
courts of the forum.

The rule is that a party is estopped to challenge the personality
of a corporation after having acknowledged the same by entering into a contract
with it.^[16] And the “doctrine of estoppel to deny
corporate existence applies to foreign as well as to domestic
corporations;”^[17]
“one who has dealt with a corporation of foreign origin as a corporate entity
is estopped to deny its corporate existence and capacity.”^[18] The principle “will be applied to
prevent a person contracting with a foreign corporation from later taking
advantage of its noncompliance with the statutes, chiefly in cases where such person
has received the benefits of the contract (Sherwood v. Alvis, 83 Ala 115, 3 So
307, limited and distinguished in Dudley v. Collier, 87 Ala 431, 6 So 304;
Spinney v. Miller 114 Iowa 210, 86 NW 317), where such person has acted as
agent for the corporation and has violated his fiduciary obligations as such,
and where the statute does not provide that the contract shall be void, but
merely fixes a special penalty for violation of the statute. **.”^[19]

The doctrine was adopted by this Court as early as 1924 in Asia
Banking Corporation v. Standard Products Co.,^[20]
in which the following pronouncement was made:^[21]

‘The general rule that in the absence of fraud a person who has
contracted or otherwise dealt with an association in such a way as to recognize
and in effect admit its legal existence as a corporate body is thereby estopped
to deny its corporate existence in any action leading out of or involving such
contract or dealing, unless its existence is attacked for causes which have
arisen since making the contract or other dealing relied on as an estoppel and this
applies to foreign as well as domestic corporations. (14 C.J. 227; Chinese Chamber of Commerce
vs. Pua Te Ching, 14 Phil. 222).”

There would seem to be no question that the Laras received
benefits generated by their business relations with ML FUTURES. Those business relations, according to the
Laras themselves, spanned a period of seven (7) years; and they evidently found
those relations to be of such profitability as warranted their maintaining them
for that not insignificant period of time; otherwise, it is reasonably certain
that they would have terminated their dealings with ML FUTURES much, much
earlier. In fact, even as regards their
last transaction, in which the Laras allegedly suffered a loss in the sum of
US$160,749.69, the Laras nonetheless still received some monetary advantage,
for ML FUTURES credited them with the amount of US$75,913.42 then due to them, thus reducing their debt to US$84,836.27. Given these facts, and assuming that the Lara
Spouses were aware from the outset that ML FUTURES had no license to do
business in this country and MLPI, no authority to act as broker for it, it
would appear quite inequitable for the Laras to evade payment of an otherwise
legitimate indebtedness due and owing to ML FUTURES upon the plea that it
should not have done business in this country in the first place, or that its
agent in this country, MLPI, had no license either to operate as a
“commodity and/or financial futures broker.”

Considerations of equity dictate that, at the very least, the
issue of whether the Laras are in truth liable to ML FUTURES and if so in what
amount, and whether they were so far aware of the absence of the requisite
licenses on the part of ML FUTURES and its Philippine correspondent, MLPI, as
to be estopped from alleging that fact as a defense to such liability, should
be ventilated and adjudicated on the merits by the proper trial court.

WHEREFORE, the decision of the Court of Appeals in CA-G.R.
CV No. 16478 dated November 27, 1990 and its Resolution of March 7, 1991 are
REVERSED and SET ASIDE, and the Regional Trial Court at Quezon City, Branch 84,
is ORDERED to reinstate Civil Case No. Q-52360 and forthwith conduct a hearing
to adjudicate the issues set out in the preceding paragraph on the merits.

SO ORDERED.

Padilla, Regalado, and Nocon, JJ., concur.

Paras*, J.,retired.

^[1]
The case was docketed as Civil Case No. Q-52360 and assigned to Branch 84,
presided over by Hon. Teodoro P. Regino

^[2]
It appears that Merrill Lynch Philippines, Inc. was
formerly registered and known as Merrill Lynch, Pierce, Fenner
& Smith Philippines, Inc.. — SEE footnote 5, infra.

^[3]
The Laras say the trading was carried on for seven (7) years

^[4]
Annexes A to H

^[5]
See footnote 2, supra

^[6]
The appeal was docketed as CA-G.R. CV No. 16478

^[7]
Written for the Seventh Division by Francisco, C., J., with whom
concurred Lombos-de la Fuente, Chairman, and Aldecoa, Jr., J.

^[8]
The counterpart provision (Sec. 69) of the prior law, Act No. 1459, stated that
“No foreign corporation or corporation formed, organized, or existing
under any laws other than those of the Philippines, shall be permitted to
transact business in the Philippines or maintain by itself or assignee any
suit for the recovery of any debt, claim, or demand whatever, unless it
shall have the license prescribed in the section immediately preceding. * *
” (italics supplied) (although, it may be added, it may be, sued [General
Corporation of the Philippines v. Union Insurance Society of Canton,
Ltd., 87 Phil. 313 (1950)]).

^[9]
Emphasis supplied by Francisco, C., J., ponente

^[10]
Per Resolution dated March 7, 1991, which also “directed (the
Trial Court) to hear and resolve appellees’ application for
damages on the appellant’s attachment bond“

^[11]
SEE Feria, Civil Procedure, 1969 ed., pp. 342-344, citing Paminsan v.
Costales, 28 Phil. 487, 489; De Jesus, et al. v. Belarmino, et al., 95
Phil. 365; Worldwide Insurance & Surety Co., Inc. vs. Manuel, 98
Phil. 47); Worldwise Insurance & Surety Co. v. Macrohon, et al.,
G.R. No. L-12365, Feb. 28, 1989; Dimayuga v. Dimayuga, 96 Phil. 859,
862; Ma-ao Sugar Central v. Barrios, 79 Phil. 666; Uy Hoo v.
Yuseco, 89 Phil. 944; Aranzanso v. Martinez, 88 Phil. 536; SEE, also,
Moran, Comments on the Rules of Court, 1979 ed., Vol. 1, pp. 490-493, with
voluminous citations

^[12]
Feria, op. cit., p. 342

^[13]
Moran, op. cit., pp. 491-492, citing Heirs of Juliana Clavano v.
Genato, G.R. No. L­-45837, Oct. 28, 1977; cf., Aranzanso v.
Martinez, 88 Phil. 536, cited in Feria, op. cit., p. 344

^[14]
I.e., Section 133 of the Corporation Code, supra (SEE General
Corporation of the Philippines v. Union Insurance Society of Canton,
Ltd., 87 Phil. 313); or he does not have the necessary qualifications to appear
at the trial, such as when he is not in the full exercise of his civil rights
(Lunsod v. Ortega, 46 Phil. 664, cited in Feria, Civil Procedure, 1969
ed., pp. 316-317)

^[15]
SEC. 2, Rule 3 of the Rules of Court provides that “Every action must be
prosecuted and defended in the name of the real party in interest. All persons
having an interest in the subject of the action and in obtaining the relief
demanded shall be joined as plaintiffs. All persons who claim an interest in the controversy adverse to the
plaintiff or who are necessary to a complete determination or settlement of the
questions involved therein shall be joined as defendants.” “The real party
in interest is the party who would be benefited or injured by the judgment, or
the ‘party entitled to the avails of the suit’ (1 Sutherland, Code Pleading
Practice & Forms, p. 11) (Salonga v. Warner, Barnes & Co., Ltd.,
88 Phil. 125, cited in Feria, op. cit., p. 139). SEE, also, Moran, op.
cit., p. 154; and Lunsod v. Ortega, supra, holding inter
alia that a plaintiff has no legal capacity to sue when he does not have
the character or representation he claims, which is a matter of evidence

^[16]
See Ohta Development Co. v. Steamship ‘Pompey,’ et al., 49 Phil. 117,
120 (1926); Asia Banking Corporation v. Standard Products Co., 46 Phil.
144 (1924)

^[17]
14 C.J. 227

^[18]
36 Am Jur 2d, pp. 296-297, although there is authority that said doctrine
“does not, by analogy, require that
such person be held estopped to deny that the corporation has complied with the
local statutes imposing conditions, restrictions, and regulations on foreign
corporations and that it has acquired thereby the right to do business in the
state”

^[19]
Ibid.

^[20]
46 Phil. 144 (1924), supra

^[21]
Italics supplied

* RETIRED as of July 4, 1992