Practice question
An absorbed corporation’s customer owes a valid receivable. After an effective merger the customer insists that it owes both the vanished constituent and the survivor separately because two historical corporate names appear in the papers. No novation creating a second debt exists. Which is correct?
- The merger automatically doubles every debt
- Historical names always create independent obligations
- Section 79 transfers the existing receivable to the survivor; it does not by itself duplicate that same debt.
- The customer is automatically released
- The receivable must go personally to former shareholders
Legal references
- Revised Corporation Code, RA 11232, Section 79: https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/2/86463
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