WPM International Trading Inc. vs Labayen

What is the full case title and citation for this September 17, 2014 decision?

WPM International Trading, Inc. vs. Labayen, G.R. No. 182770, September 17, 2014.

Parties and Agreement Who were the parties involved in the management agreement for Quickbite restaurant outlets?

Fe Corazon Labayen, WPM International Trading, Inc., and its president, Warlito P. Manlapaz.

Renovation Contract What contract did Labayen enter into with CLN Engineering Services for the Quickbite-Divisoria branch?

A renovation contract worth ₱432,876.02, of which WPM only paid ₱320,000.

Initial Civil Case What was the result of the civil case filed by CLN against Labayen?

Labayen was declared in default and held liable for the unpaid balance and fees.

Labayen’s Complaint Why did Labayen file a complaint for damages and indemnity against WPM and Manlapaz?

She claimed she contracted for WPM and was entitled to reimbursement for the judgment.

WPM and Manlapaz Defense What was the primary defense of WPM and Manlapaz against Labayen’s claim for indemnity?

They asserted Labayen exceeded her authority and WPM’s corporate personality shielded them from liability.

RTC and CA Findings On what grounds did the lower courts pierce the corporate veil of WPM?

WPM was considered a mere instrumentality or business conduit of its president, Warlito Manlapaz.

Evidence for Instrumentality What facts did the CA use to conclude WPM and Manlapaz were the same?

Manlapaz held multiple offices, used his residence as office, and derived name from initials.

Core Legal Issues What were the core issues regarding WPM’s corporate personality and Manlapaz’s personal liability?

Whether WPM was an alter ego and if Manlapaz was jointly liable for reimbursement.

Supreme Court Ruling on Veil Piercing Did the Supreme Court agree with piercing the corporate veil of WPM International Trading?

No; there was no clear evidence WPM’s corporate personality was abused to commit fraud.

Ownership vs. Alter Ego Is being a principal stockholder and officer enough to prove a corporation is an instrumentality?

No; mere ownership and holding multiple positions are insufficient to prove an alter ego exists.

Separate Personality Doctrine What did the Supreme Court emphasize regarding the liability of a corporation and its incorporators?

Corporate personality is distinct, and obligations are generally borne by the corporation, not individuals.

Final Liability of Manlapaz What was the Supreme Court’s final decision regarding the personal liability of Warlito P. Manlapaz?

Manlapaz was absolved from personal liability; WPM alone was held liable to indemnify Labayen.

Award of Moral Damages Why did the Supreme Court uphold the award of moral damages against WPM?

WPM’s unjustified refusal to pay a just debt constituted bad faith under the code.