TJM Association is a non-stock national organization with several
chapters nationwide. Based on its
By-Laws, it has 25 National Directors consisting of 21 Regional Directors and 4
Sectoral Directors. The 21 Regional
Directors are elected by members belonging to defined geographical areas while
Sectoral Directors are elected nationwide by members belonging to each sector.
The SEC was asked to opine on whether TJM’s method of electing directors
on a regional basis is in violation of the Corporation Code?
Section 89 of the Corporation Code, applicable to non-stock
corporations, provides that the right of members to vote may be limited to the
extent specified in the articles and by-laws.
Under this provision, there is nothing objectionable about the manner of
voting for the directors of TJM as provided in its By-Laws. Its By-Laws have in
effect limited the right of members to vote only for candidates for director
for their own region. Hence, under
Section 89, regional elections for directors may be allowed as long as it is
the mode of election provided in the non-stock corporation’s by-laws.
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