PEOPLE OF THE PHILIPPINES, plaintiff-appellee,

vs.
ENGR. CARLOS GARCIA y PINEDA, PATRICIO BOTERO y VALES, LUISA
MIRAPLES (at large), accused,
PATRICIO BOTERO y VALES, accused-appellant.
G.R. No. 117010 April 18, 1997, J. Puno
Patricio Botero together with Garcia and Miraples were supposed incorporators of
Ricorn Philippine International Shipping Lines, Inc., an entity which recruits workers
for overseas employment. The complainants applied for employment with the
Ricorn but they found out that they were defrauded and subsequently filed a
complaint of illegal recruitment against Ricorn. For reasons that cannot be
discerned from the records, Ricorn's incorporation was not consummated. Even
then, Boterocannot avoid his liabilities to the public as an incorporator of Ricorn. He
and his co-accused Garcia held themselves out to the public as officers of Ricorn.
They received money from applicants who availed of their services. They are thus
estopped from claiming that they are not liable as corporate officials of Ricorn.
Facts:
In an Information dated July 21, 1992, accused-appellant Patricio Botero together
with Carlos P. Garcia and Luisa Miraples were charged with the crime of illegal
recruitment in large scale defined by Article 38 (b) and penalized under Article 39
(a) of the Labor Code, as amended by Presidential Decree Nos. 1920 and 2018.
Six (6) out of the sixteen (16) complainants testified as prosecution witnesses. They
testified that on various dates in March 1992, they went to Ricorn Philippine
International Shipping Lines, Inc. (hereinafter Ricorn), an entity which recruits
workers for overseas employment, with office at Rm. 410, Jovan Building, 600 Shaw
Blvd., Mandaluyong, Metro Manila. They applied as seamen, cook, waiter,
chambermaid or laundrywoman overseas. Esclada applied to accused Botero. All the
other complainants coursed their application to accused Garcia who represented
himself as president of Ricorn. Complainants were required to submit their NBI and
police clearance, birth certificate, passport, seaman's book and Survival of Life at
Sea (SOLAS). As they did not have the last three (3) documents, they were asked to
pay five thousand pesos (P5,000.00) as processing fee. They paid to Ricorn's
treasurer, Luisa Miraples. They were issued receipts signed by Miraples. The
receipts were under Ricorn's heading.
Garcia and Botero assured complainants of employment after the May 11, 1992
election. Accused Botero, as the vice-president of Ricorn, followed-up their
passports, seaman's book and SOLAS. He told some applicants to wait for their
papers and informed the others that their papers were in order.

After the election, complainants went back to Ricorn to check on their applications.
They discovered that Ricorn had abandoned its office at Jovan Building for nonpayment of rentals. Hoping against hope, they went back to the building several
times to recover their money. Their persistence was to no avail for Garcia and
Botero were nowhere to be found. They then went to the Mandaluyong Police
Station and filed their complaints. They also checked with the Securities and
Exchange Commission (SEC) and discovered that Ricorn was not yet incorporated.
They also found that Ricorn was not licensed by the Department of Labor and
Employment (DOLE) to engage in recruitment activities.
Issue:
Whether or not as a corporation by estopel, Ricorn is liable for illegal recruitment.
Ruling:
Yes. Ricorn is liable for illegal recruitment as a corporation by estopel.
For engaging in recruitment of workers without obtaining the necessary license from
the POEA, Boteros should suffer the consequences of Ricorn's illegal act for "(i)f the
offender is a corporation, partnership, association or entity, the penalty shall be
imposed upon the officer or officers of the corporation, partnership, association or
entity responsible for violation; . . . " The evidence shows that appellant Botero was
one of the incorporators of Ricorn. For reasons that cannot be discerned from the
records, Ricorn's incorporation was not consummated. Even then, appellant cannot
avoid his liabilities to the public as an incorporator of Ricorn. He and his co-accused
Garcia held themselves out to the public as officers of Ricorn. They received money
from applicants who availed of their services. They are thus estopped from claiming
that they are not liable as corporate officials of Ricorn. Section 25 of the
Corporation Code provides that "(a)ll 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
the 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."