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de jure corporation De facto Corporation by estoppel Corporation by prescriptionConsidered as a legally constituted as

corporation

-one is created in strict or substantial

conformity with the mandatory

statutory requirements for

incorporation

One which actually exists for all practical

purposes as a corporation

-but which has no right to corporate

existence as against the State

-one which has not complied with all the

requirements necessary to be de jure

corporation

-but has complied suciently to be

accorded corporate status against the 3rdpersons, but not the state

equisites! "here must be!

#$ a %alid law &under which a corporationwith powers assumed might be

incorpated'

($ a bona )de attempt to organi*e a

corporation under such law

3$ +ctual use or exercise in ood aith of

corporate powers conferred upon it by

law

+rises when the persons assume to act

as a corp

.nowing it to be without authority to do

so/

0n this case, those persons will be liable

as 121+ 4+"21S 5up to their

personal properties$ for all debts,

liabilities and damages incurred or

arising as a result of their actions

-they cannot be permitted to deny its

existence

-those who are not aware of the defect &

are liable only up to their in6estment

-a6ailable only to claimants

-not a defense against a claimants

4urpose! protection of 3rdpersons and

creditors

Corporation that was not formally

organi*ed as such

7ut has been duly recogni*ed for

substantial length of time as a

corporation,

8ith rights and duties that are

enforceable under the law

1x' oman Catholic Church

9as the same corporate power andliabilities as a corp de jure

-obligations 5enter contracts$, sue or be

sued, incur liabilities

Rule against Collateral Attack

Cannot be collaterally attac:ed by the

state or by pri6ate indi6iduals!

Sate must bring a direct proceeding 5;

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Corp de Facto

Valid Law Bona Fide Attempt to Incorporate se of Corporate !owers in in "Fthere must be a law authori*ing it to be a

corporation de jure

-there cannot be a corporation defacto

8here there cannot be corp de jure1x'aw was declared unconstitutional

Corp purpose is prohibited by law

2o corp for the practice of a learned

profession5 unless a law permits it$

#$no attempt in to create a corp de jureno

corp de facto

-will open the door to fraud upon the

public($bona )de attempt to comply with requirementsof the law

-+mounting to ?Colorable Compliance@

with the law

-colorable compliance & depend on the

situation and :nowledge of the parties

2o Corp de facto is

created! 5defects$

Aefacto Corp is

created, despite

defects!a$ absence of +O0

b$ failure to )le +O0

c$ lac: of certi)cate of

incorporation formS1C

-atal e6en when done

in

-+O0 essential to the

existence of de facto

corp

a$ +O0 fails to state all

matters required by

code or

state some ofthem

incorrectly

b$name of corp closely

resembles that of pre-

existing corp

c$0ncorporators or

certain numbers of

them are not residents

of 4hil

d$ ac:nowledgement

of +O0 or CO0 is

-insucient ordefecti6e in form

+c:nowledge by

wrong ocer

e$ percentage of il

ownership is less than

prescribed

f$ minimum paid up

capital has not been

paid up and recei6ed

by corp treasurer

contrary to his

ada6it

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g$ failure to submit by

laws on time

7asis of Aefacto Corp!

-necessary to promote security of business transactions

-eliminate quibbling o6er irregularities