G.R. No. 184088; July 6, 2010
Iglesia Evangelica Metodista En Las Islas Filipinas (IEMELIF) (Corporation Sole), Inc., et al. vs. Bishop Nathanael Lazaro, et al.

FACTS

The Iglesia Evangelica Metodista En Las Islas Filipinas (IEMELIF) was established in 1909 as a corporation sole. In 1948, it enacted by-laws creating a Supreme Consistory of Elders, which functioned as a de facto board of directors, effectively operating the church as a corporation aggregate despite its official corporate sole status. In 1973, the general membership voted to formally convert IEMELIF into a corporation aggregate, which the SEC approved. However, its articles of incorporation were never amended to reflect this change.
In 2001, the SEC advised IEMELIF that the 1973 conversion was not properly documented and required an amendment of its articles of incorporation. The Consistory and general membership subsequently approved the conversion, and amended articles were filed with the SEC. A faction led by Rev. Nestor Pineda opposed this, filing a case to declare the amended articles null. They argued that a corporation sole cannot convert to a corporation aggregate by mere amendment but must first undergo dissolution and re-incorporation.

ISSUE

Whether a corporation sole may be converted into a corporation aggregate by mere amendment of its articles of incorporation.

RULING

The Supreme Court ruled affirmatively, upholding the conversion by amendment. The legal logic proceeds from the application of general corporate principles to religious corporations. While the Corporation Code’s specific title on Religious Corporations (Sections 109-116) does not contain a provision for amending the articles of a corporation sole, Section 109 states that religious corporations shall additionally be governed by the provisions on non-stock corporations where applicable.
For non-stock corporations, Section 16 of the Corporation Code governs amendments, requiring a vote or written assent of at least two-thirds of the members. This provision was correctly applied to IEMELIF, a corporation sole. The Court found that the requisite approval from the general membership was validly obtained. The conversion did not require dissolution, as the amendment merely formalized the church’s long-standing operational reality as a corporation aggregate, a change in structure that did not terminate its corporate existence or juridical personality. The amendment was a proper exercise of the corporation’s inherent power to alter its articles pursuant to Section 36 of the Code.