Practice question
A stockholder claims an unconditional right to receive a cash dividend from every corporate receipt, even though no dividend has lawfully been declared. Which is best?
- Every receipt is automatically a dividend
- Corporate revenue belongs individually to shareholders
- The stockholder may withdraw cash whenever desired
- Only the largest shareholder controls dividends personally
- Dividend rights are subject to lawful declaration and the Code’s requirements, not automatic distribution of each receipt
Legal references
- https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/2/86463 — RA 11232, sections 23, 38, 42, 71, 73 and 74
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