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Legal Arguments Contesting the FFL Letter "Beating our Swords into Ploughshares"
by Anonymous

Mga kapatid, FFL's swords-into-plowshares message is significant legal evidence. Could someone please try to get an original copy of this.

Note that the message was signed CFC-FFL. Because it is thus signed, it is clear that the message is meant to be understood that all FFL members are behind this message.

Note, however, that CFC-FFL is an organization without any legal personality. Ironically the message itself affirms this by correctly stating that "... even the original application for the use of CFC-FFL has not been rejected by the SEC." Which is, of course, only half the truth. The SEC has also not approved their registration.

Here's the hook: Corporation Code of the Philippines: "Sec. 21. Corporation by estoppel. All persons who assume to act as a corporation knowing it to be without authority to do so shall be liable as general partners for all debts, liabilities and damages incurred or arising as a result thereof: Provided, however, That when any such ostensible corporation is sued on any transaction entered by it as a corporation or on any tort committed by it as such, it shall not be allowed to use as a defense its lack of corporate personality."

That means ALL FFL members will become respondents in any suit brought against FFL.

Their message also states: "CFCFI became inactive for sometime precisely because it allowed CFC Global Mission Foundation, Inc. to carry on its mission. But now that CFC Global has veered away from the life and mission it was supposed to pursue, CFCFI now has every right to restore the eroded anchors of the life and mission and revive the original spirit which guided the community to put up, by virtue of " prior right," CFCFI."

Note the first sentence. First, it constitutes an admission by FFL that CFC-GMFI is the entity charged with carrying on the mission and that CFCFI should become inactive. Section 40 of the Corporation Code regulates the sale or disposition of the assets of the corporation and states that "In non-stock corporations, where there are no members with voting rights, the vote of at least a majority of the trustees in office will be sufficient authorization for the corporation to enter into any transaction authorized by this section." The decision of the CFC Council in 1994 to continue the mission with CFC-GMFI and let CFCFI become dormant effectively transferred all assets, rights, franchises and goodwill of CFCFI to CFC-GMFI. FFL's message, as quoted above, admits this as well.

But FFL, in the next sentence assumes that CFCFI has every right to restore by virtue of prior right. This is so absurd as to be laughable. Here's 4 reasons why?

  1. CFCFI does not have any rights anymore. They have all been transferred by the board to CFC-GMFI in 1994. When CFCFI's registration was revoked in 2003, it lost its juridic personality and all its corporate powers and ceased to exist as a corporation. CFC-GMFI's ownership of all assets, rights and goodwill then became absolute. CFC-GMFI has been exercising this right exclusively for 18 years. Laches has worked in favor of CFC-GMFI. In the Philippine Blooming Mills case of 1988 (see G.R. No 71837, Philippine Supreme Court), the Supreme Court states "We have said in a number of cases that laches, in a general sense, means the failure or neglect, for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier. It is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it either has abandoned or declined to assert it. Public policy requires, for the peace of society, the discouragement of claims grown stale for nonassertion. Unlike the statute of limitations, laches does not involve mere lapse or passage of time but is principally an impediment to the assertion or enforcement of a right which has become under the circumstances inequitable or unfair to permit."
  2. FFL does not have the authority to judge whether CFC-GMFI has veered away from its mission, simply because they are not part of the CFC-GMFI organization or its regulatory reporting line. FFL is not a supervisory body with oversight powers. For CFC-GMFI this is the Vatican, which has never accused CFCGMFI of veering away. FFL is, in a sense, a "competing organization." Whatever they say about the business of CFC-GMFI do not carry any weight and cannot impose standards of performance that CFC-GMFI is obliged to follow. FFL is not a standard-setting body on the rightness or wrongness of an organization's direction. The most that they can do is give their own opinion.
  3. One man's decision to revive CFCFI is highly questionable because it was done with the intention of taking up again the original activities of the revoked entity which should have been a decision by a majority of the board. Since it was allowed to become dormant, and since its revocation in 2003, CFCFI has not had any board. This means the SEC lifting of the CFCFI revocation is the approval of the case of one person taking over the name of a defunct entity. See CA-G.R. SP NO. 92740, Supreme Court case re Filipino-Indian Chamber of Commerce. The resulting entity may have the same name as the old, defunct one, but is a totally different organization. It may still be called CFCFI but it is not the same CFCFI that went dormant in 1994. The "new" CFCFI is actually even younger than FFL. Insisting that it is the old CFCFI would require FFL to reconstitute the board, the majority of whom are not FFL members, if they can be found. Frank cannot, on his own, reduce the number of the board without approval from the SEC. But applying for such an approval requires a board resolution. And he can't appoint people there because they have to be elected by the members. And who are the members? For the old CFCFI, these would be the CFC members on 1994. Many of the FFL members today were not members then, so they can be disqualified. You see the impossibility of reconstituting the board? The only viable alternative is to have a new organization with an old name.
  4. FFL talks about "prior right." Further to (3) above, I refer you to G.R. No. 137592, Supreme Court case of 2001, ANG MGA KAANIB SA IGLESIA NG DIOS KAY KRISTO HESUS, H.S.K. SA BANSANG PILIPINAS, INC. petitioner, vs. IGLESIA NG DIOS KAY CRISTO JESUS, HALIGI AT SUHAY NG KATOTOHANAN, respondent. All FFL, a new organization, has taken taken over from the old defunct entity is the name - CFCFI. The "Couples for Christ" appellation belongs to CFC-GMFI by virtue of succession. It is CFC-GMFI that has the prior right to the name.
    The reason why the International Council has not taken issue with the other 5 entities carrying the name CFC is exactly the same reason the SEC approved the registration of those entities. This is best explained by the Intellectual Property Code, Sections 168 and 169.
    SECTION 168. Unfair Competition, Rights, Regulation and Remedies. —
    168.1. A person who has identified in the mind of the public the goods he manufactures or deals in, his business or services from those of others, whether or not a registered mark is employed, has a property right in the goodwill of the said goods, business or services so identified, which will be protected in the same manner as other property rights.
    168.2. Any person who shall employ deception or any other means contrary to good faith by which he shall pass off the goods manufactured by him or in which he deals, or his business, or services for those of the one having established such goodwill, or who shall commit any acts calculated to produce said result, shall be guilty of unfair competition, and shall be subject to an action therefor.
    SECTION 169. False Designations of Origin; False Description or Representation. —
    169.1. Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which:
    a. Is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person; or
    b. In commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities, shall be liable to a civil action for damages and injunction provided in Sections 156 and 157 of this Act by any person who believes that he or she is or is likely to be damaged by such act.
    The other 5 entities do not pose a problem because their products are different than CFC-GMFI's - one is a taxi, another is a bakery, etc. But FFL has the same product as CFC-GMFI and this will cause and is already causing confusion in the public mind.
  5. In addition, for the past 18 years, the name "Couples for Christ" has been associated with CFC-GMFI. CFCGMFI thus has a property right in the goodwill of this name according to Section 168 of the IP Code above. Further, quoting the Decision by the Court of Appeals on CA-G.R. SP No. 84545, EAGLE EXPRESS LINES, INC. vs CIRCLE FREIGHT INTERNATIONAL PHILS., INC.:
    "In an old but still pertinent case, the Supreme Court pronounced that a corporation’s right to use its corporate or trade name is in the nature of a property right; a right in rem which the corporation may assert and protect against the whole world in the same manner as it may protect its tangible property, real or personal, against trespass or conversion. The use and adoption of a corporate name is regarded, to a certain extent, as a property right and one which cannot be impaired or defeated by subsequent appropriation by another corporation operating in the same commercial field (Western Equipment and Supply Company vs. Reyes, 51 Phil. 115).
    A corporate name is peculiarly important as necessary to the very existence of the corporation. Its name is one of its vital attributes, an element of its being and existence, and essential to its identity with respect to the public with whom it transacts. As a general rule, a corporation must have an official appellation by which it is to sue, be sued, and perform legal acts. The name of the corporation in this respect designates the corporation in the same manner as the name of an individual designates the person; and the right to use its corporate name is as much a part of the corporate franchise as any other privilege granted."
  6. Anent the sixth point of FFL's message talking about one big CFC with 2 branches. Frank's behavior in the past year has shown everyone that he can only be effective when he is the sole leader. The CFC of today does not have any place for dictators. Frank is incapable of placing himself under a higher authority. FFL is not a branch of CFC. Neither is it a child of CFC, as Fr. Tulabing asserts. CFC did not create FFL. To FFL, I would say this: what you are talking about is a merger in which the small party dictates to the large party. Let me tell you that you have a weird way of going about it. Accusing the big guy of being unfaithful to its faith amd mission and alienating its membership is not a good way in persuading them to merge. It does not endear you to them. If you are counting on the Stockholm Syndrome to work for you, you are sadly mistaken. Browbeating the members to make them submissive to your wishes may have worked during the early Spanish colonial times, but in this day and age, you're barking up the wrong tree. CFC members are sane, thinking, and highly rational Christians practicing their God-given charisms. They have no wish to be held captive or hostage by a dictator. I am afraid, dear FFL, that your actions in the past year have made sure that your dream of one CFC with two branches will remain just that, a dream.

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