G.R. No. L-19118 January 30, 1965
MARIANO A. ALBERT, plaintiff-appellant, vs. UNIVERSITY PUBLISHING CO., INC., defendant-appellee.

FACTS

Mariano A. Albert sued University Publishing Co., Inc. for breach of contract. The defendant, through its President Jose M. Aruego, had contracted to pay Albert P30,000.00 for publishing rights and a share in sales. The Court of First Instance rendered judgment for the plaintiff. On appeal, the Supreme Court reduced the damages to P15,000.00, which became final and executory. When the plaintiff sought execution, a certification from the Securities and Exchange Commission revealed that “University Publishing Co., Inc.” was not registered as a corporation or partnership. Plaintiff then petitioned for a writ of execution against Jose M. Aruego as the real defendant. The lower court denied this petition. The defendant, through counsel (Aruego’s own law firm), argued that Aruego was not a party to the case.

ISSUE

Whether the final and executory judgment against the non-existent “University Publishing Co., Inc.” may be executed against Jose M. Aruego as the real party defendant.

RULING

Yes. The Supreme Court set aside the lower court’s order and remanded the case for supplementary proceedings to carry the judgment into effect against University Publishing Co., Inc. and/or Jose M. Aruego. The Court ruled that since “University Publishing Co., Inc.” was not registered, it had no separate juridical personality from Jose M. Aruego. Aruego, who represented the non-existent entity, signed the contract as its President, induced the plaintiff to act on this misrepresentation, reaped the benefits, made partial payments, and was the real party who litigated the case through his law firm. Therefore, he had his day in court, and due process was substantially observed. The doctrine of corporation by estoppel was inapplicable, and the veil of corporate fiction could be pierced to hold Aruego personally liable for the judgment.