Conflict of Laws Midterm 2014

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8lLon, Cregorlo, 8ayalas, Canada, Camlnade, 8alL, uenLe, SoLLo, Sanchez

1hls sub[ecL ls known as ConfllcL of Laws, oLherwlse known as prlvaLe lnLernaLlonal law. 1hey are
essenLlally Lhe same, buL Lhe one LhaL ls offlclally used ls ConfllcL of Laws. Why? 8ecause Lhls ls Lhe one
belng adopLed by Lhe Supreme CourL and belng prescrlbed by Lhe ueparLmenL of LducaLlon.

1he sLudy of ConfllcL of Laws or rlvaLe lnLernaLlonal Law ls premlsed on one unlversal LruLh LhaL each
counLry, each sLaLe has lLs own body of laws whlch may be dlfferenL from oLher counLrles. And each
body of laws ls classlfled lnLo Lwo general bodles of classlflcaLlon. We have Lhe so-called ln1L8nAL LAW
whlch governs cases or conLroversles lnvolvlng purely domesLlc or local elemenLs. Llke a dlspuLe
lnvolvlng breach of conLracL or speclflc performance Lo compel Lhe defendanL Lo comply wlLh Lhe Lerms
and condlLlons of Lhe conLracL, Lhe conLracL was enLered lnLo beLween 2 llllplnos, execuLed ln Lhe
hlllpplnes, lnvolvlng a sub[ecL maLLer locaLed ln Lhe hlllpplnes, and Lhe conLracL ls Lo be performed ln
Lhe hlllpplnes. All Lhese elemenLs of Lhe conLracL, all Lhe componenLs of Lhe LransacLlon, all perLalnlng
Lo one sLaLe - hlllpplnes, and Lherefore, Lhls dlspuLe calls for Lhe appllcaLlon of purely local law or whaL
we have now Lhe purely lnLernal law.
Cn Lhe oLher hand, Lhe oLher general classlflcaLlon ls Lhe so called CCnlLlC1 Cl LAWS, whlch govern
dlspuLes, conLroversles or cases lnvolvlng forelgn elemenLs. ln oLher words, noL all elemenLs or
componenLs of Lhe LransacLlon or conLroversy perLaln Lo one sLaLe buL may perLaln Lo more Lhan one
sLaLe, and Lherefore, may refer Lo Lwo or more laws perLalnlng Lo Lwo or more counLrles. 1hls ls Lhe klnd
of conLroversy calls for Lhe appllcaLlon of confllcL of laws rules. now, whaL are Lhe speclflc confllcL of
laws rules ln Lhe hlllpplnes?
We have ArLlcle 13.. or ArLlcle 16 whlch says LhaL real or personal properLy ls governed by Lhe law of Lhe
place where Lhe properLy ls locaLed. Cr Lhe 2
nd
paragraph of ArLlcle 16 - LesLaLe or lnLesLaLe successlon
lnsofar as order of successlonal rlghLs, amounL of successlonal rlghLs and Lhe lnLrlnslc valldlLy of
LesLamenLary provlslons are governed by Lhe naLlonal law of Lhe decedenL. 1hese provlslons speclflcally
govern cases whlch lnvolve forelgn elemenL or a slLuaLlon called confllcL of law slLuaLlon. So lf Lhe
decedenL dles, a Cerman naLlonal, domlclled ln Lhe hlllpplnes aL Lhe Llme of hls deaLh, leavlng
properLles ln Lhe hlllpplnes. So you see Lhe elemenLs of Lhe conLroversy, Lhe facLs, Lhe evenLs of Lhe
LransacLlon lnvolved ln Lhe conLroversy may perLaln Lo 2 counLrles - Cermany lnsofar as Lhe decedenL ls
a Cerman clLlzen, and hlllpplnes, because Lhe properLles lefL by Lhe decedenL are locaLed ln Lhe
hlllpplnes. So noL all elemenLs or componenLs of Lhe LransacLlon are purely local, and Lherefore Lhls ls a
confllcL of law slLuaLlon. 1hls ls an lssue of successlon, we have Lo apply ArLlcle 16, our own ConfllcL of
laws rule.
Pow does Lhe law deflne CCnlLlC1 Cl LAW"?
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A ConfllcL of Law ls noL lnLernaLlonal law as dlsLlngulshed from publlc lnLernaLlonal law. ConfllcL of law ls
parL of Lhe munlclpal law, Lhls ls a local law. Llke ArL 16, properLy and successlon ls parL of our own Clvll
Code of Lhe hlllpplnes and Lherefore ls parL of our uomesLlc Law, buL speclflcally governs cases
lnvolvlng forelgn elemenL.
lL ls parL of Lhe munlclpal law or domesLlc law of Lhe sLaLe whlch dlrecLs Lhe sLaLes, courLs, or
admlnlsLraLlve agencles when confronLed wlLh problems or cases or conLroversles lnvolvlng forelgn
elemenL WCn Lo apply Lhe forelgn law or Lhe lnLernal law.
8y lLs deflnlLlon, ConfllcL of Laws Lherefore, sLrlcLly arlses ln a slLuaLlon where Lhere ls a forelgn elemenL
lnvolved ln Lhe conLroversy.
When ls a dlspuLe or conLroversy deemed Lo have forelgn elemenL? When ls Lhere a forelgn elemenL ln a
glven conLroversy LhaL calls for Lhe appllcaLlon of confllcL of laws rules?
1here ls forelgn elemenL when Lhe conLroversy lnvolves facLs, occurrence or LransacLlons occurrlng ln
more Lhan one sLaLe and affecLed by Lhe laws of Lhese sLaLes lnvolved so LhaL ln Lhe resoluLlon of Lhese
conLroversles, Lhe Lroubled ? courL wlll have Lo make a cholce whlch of Lhese laws lnvolved should
apply ln Lhe conLroversy. lacLs, evenLs and LransacLlons affecLlng Lhe conLroversy. ln oLher words, Lhere
ls confllcL of laws slLuaLlon when Lhe lssue lnvolved confronLlng Lhe courL ls affecLed by Lhese facLs,
evenLs or LransacLlons, whlch dlrecLly perLaln Lo laws of one or more Lhan one sLaLe. ln oLher words,
confllcL of laws comes lnLo play lf Lhe resoluLlon of Lhe lssues lnvolved ln Lhe case depends on Lhe laws
affecLlng Lhese facLs, evenLs and LransacLlons lnvolved.
SLrlcLly speaklng Lherefore, noL all laws lnvolvlng someLhlng LhaL may perLaln Lo a forelgn counLry would
call for Lhe appllcaLlon of confllcL of laws. ConfllcL of laws arlses only and you apply lLs rule when Lhe
lssue ls affecLed by Lhls forelgn elemenL. So lf Lhe forelgn elemenL has noLhlng Lo do wlLh Lhe lssue,
Lhere ls no occaslon Lo speak of Lhe confllcL of law slLuaLlon and Lherefore you do noL apply confllcL of
laws rule.
So for example, where Lhe forelgn elemenL ls noL declslve ln Lhe lssue lnvolved - A forelgn naLlonal, a
Cerman, commlLLlng a crlme ln Lhe hlllpplnes. Pls belng a clLlzen of a Cerman counLry may be a forelgn
elemenL because hls clLlzenshlp perLalns Lo a forelgn counLry. 8uL lnsofar as [urlsdlcLlon of crlme ls
concerned, lL doesn'L maLLer, because [urlsdlcLlon applles ls LerrlLorlal. lL doesn'L maLLer wheLher Lhe
crlmlnal ls a forelgner or a clLlzen, Lhe [urlsdlcLlon ls wlLhln Lhe courL where Lhe crlme ls commlLLed. So
Lhls ls noL sLrlcLly a confllcL of law slLuaLlon because Lhe facL LhaL Lhe offender ls a Cerman clLlzen, or a
clLlzen of a forelgn counLry ls noL relevanL Lo Lhe lssue confronLlng Lhe courL, Lhe lssue belng over Lhe
crlme commlLLed. So Lhls lllusLraLed a slLuaLlon where alLhough Lhe conLroversy may lnvolve facLs or
occurrence perLalnlng Lo anoLher counLry buL Lhese facLs or LransacLlons do noL affecL Lhe lssue lnvolved
ln Lhe case.
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1he deLermlnaLlon of wheLher Lhe case or conLroversy ls classlfled as a confllcL of law slLuaLlon, as l sald,
ls lnLernal. lL ls deLermlned by Lhe forum applylng lLs own law. ln oLher words, lf Lhe case ls flled before
our own courL, Lhe law appllcable ln resolvlng Lhe confllcL of law slLuaLlon ls noL Lhe confllcL of laws of a
forelgn counLry buL Lhe confllcL of laws ln Lhe hlllpplnes because as l sald, Lhe confllcL of law ls parL of
Lhe munlclpal law, alLhough ln Lhe process, our local courL may apply Lhe law of Lhe forelgn counLry. 8uL
Lhe speclflc confllcL of laws rule LhaL Lhe local courL may apply ls Lhe hlllpplne law and ln Lhe process
may refer Lo on or Lwo anoLher counLrles.
So lf a case ls flled before our own local courL, whaL ls our courL supposed Lo do wlLh lL?
1he [udlclal resoluLlon of a confllcL of law problem lnvolves Lhree (3) sLages: flrsL sLage ls Lhe
deLermlnaLlon of [urlsdlcLlon, second sLage ls Lhe cholce of law problem, and Lhe Lhlrd ls Lhe
enforcemenL of Lhe [udgmenL. 1hls ls how a confllcL of law resoluLlon progress.
llrsL, deLermlnaLlon of [urlsdlcLlon. 1he flrsL Lhlng LhaL Lhe courL should do ls deLermlne wheLher Lhe
case flled before lL falls wlLhln lLs [urlsdlcLlon. now how do you deLermlne [urlsdlcLlon? Whose law
should be used ln order Lo deLermlne whose forum has [urlsdlcLlon? Agaln, because confllcL of law
slLuaLlon ls parL of Lhe munlclpal law, Lhe law Lo be used ln deLermlnlng [urlsdlcLlon ls Lhe law of Lhe
forum. So Lherefore, lf lL ls flled before Lhe hlllpplne courL, LhaL parLlcular courL has [urlsdlcLlon over
Lhe conLroversy.
LeL's have a revlew on Lhe laws of [urlsdlcLlon.
ln Lhe hlllpplnes, [urlsdlcLlon ls undersLood ln Lwo conLexLs. !urlsdlcLlon over Lhe naLure of Lhe acLlon or
sub[ecL maLLer of Lhe conLroversy and [urlsdlcLlon over Lhe person.
Pow does Lhe courL acqulre [urlsdlcLlon? 8efer Lo our exlsLlng laws regardlng [urlsdlcLlon. rlmarlly, we
have 8 129, Lhe !udlclary 8eorganlzaLlon AcL. 1hls law apporLlons Lhe varlous [urlsdlcLlon of each
courLs. And we have Lhls 8epubllc AcL no. 7196, Lhe law LhaL expanded Lhe [urlsdlcLlon of Lhe M1C.
1hese laws enumeraLe Lhe speclflc klnds of dlspuLes, conLroversles or acLlons whlch fall wlLhln Lhe
[urlsdlcLlon of varlous courLs. CLher laws whlch provlde for Lhe [urlsdlcLlon over oLher sub[ecL maLLer are
Lhe laws LhaL creaLe Lhe Commerclal CourLs. 1hese so-called Commerclal CourLs exerclse [urlsdlcLlon
over commerclal dlspuLes. Cr Lhe laws LhaL confer [urlsdlcLlon Lo Lhe lamlly CourL Lhose cases known as
famlly dlspuLes. 1hese laws enumeraLe Lhe speclflc naLure of cases falllng wlLhln Lhelr respecLlve
[urlsdlcLlon. 1he forum courL where Lhe case ls flled wlll have Lo consulL all Lhese exlsLlng laws on
[urlsdlcLlon. lf lL falls wlLhln any of Lhe [urlsdlcLlon provlded for ln Lhe law Lhen LhaL courL ls deemed Lo
have [urlsdlcLlon.
WhaL abouL over Lhe person. !urlsdlcLlon ls acqulred dependlng on Lhe poslLlon of Lhe parLy. lnsofar as
Lhe [urlsdlcLlon of Lhe plalnLlff, or Lhe peLlLloner, or Lhe lnlLlaLlng parLy, [urlsdlcLlon ls acqulred by flllng
Lhe lnlLlaLory pleadlng. 8uL [urlsdlcLlon over Lhe defendlng parLy, Lhe defendanL or Lhe respondenL, lL ls
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acqulred elLher by volunLary appearance where Lhe defendanL or Lhe defendlng parLy volunLarlly
submlLs hlmself Lo Lhe auLhorlLy of Lhe courL or by Lhe so called servlce of summons. 1hls ls a coerclve
process where Lhe defendanL ls served a noLlce dlrecLlng hlm Lo reply or Lo answer or Lo respond Lo a
complalnL or a peLlLlon flled agalnsL hlm.
WhaL's Lhe rule ln Lhe servlce of summons? under Lhe 1997 8ules of Clvll rocedure, Lhe servlce of
summons ls governed by 8ule 14(?). Pow does Lhe courL acqulre [urlsdlcLlon of Lhe defendlng person by
summons? 1he rule depends on wheLher Lhe defendlng parLy ls a naLural person or ls an arLlflclal
(corporaLlon or any [urldlcal enLlLy creaLed by law wlLh a dlsLlncL personallLy). lf lL ls an arLlflclal person,
servlce of summons may vary dependlng on wheLher Lhe arLlflclal person ls a prlvaLe, domesLlc
corporaLlon or a forelgn corporaLlon. lf Lhe defendlng parLy ls a naLural person, Lhe servlce of summons,
Lhe rule on Lhe servlce of summons, may vary dependlng on wheLher Lhe naLural person ls a resldenL, or
ls found ln Lhe hlllpplnes, or ls a non-resldenL defendanL.
LeL's run Lhrough our servlce of summons lnsofar as a domesLlc prlvaLe corporaLlon. Servlce may be
served Lhrough lLs presldenL, managlng parLner, Lhe general counsel. So Lhe rules speclflcally requlre
LhaL Lhe servlce of summons be served on Lhe speclflc persons llsLed ln Lhe rules. 1he summons cannoL
be served on any offlcer oLher Lhan Lhose speclflcally menLloned ln Lhe rules.
WhaL abouL lf Lhe defendanL corporaLlon ls a forelgn prlvaLe corporaLlon? 1he rule ln Lhe servlce of
summons here depends wheLher Lhe prlvaLe forelgn corporaLlon ls dolng or LransacLlng buslness ln Lhe
hlllpplnes or wheLher Lhe forelgn prlvaLe corporaLlon ls reglsLered wlLh Lhe hlllpplnes. 8ecause Lhe
rules are dlfferenL. Pow do you serve summons lf Lhe defendanL ls a forelgn prlvaLe corporaLlon
LransacLlng or dolng buslness ln Lhe hlllpplnes. SecLlon 12 of 8ule 14 says LhaL lf a defendanL parLy ls a
prlvaLe forelgn corporaLlon, Lhe servlce of summons musL be served flrsL upon lLs resldenL agenL. 1hls ls
obvlous because when Lhe forelgn prlvaLe corporaLlon LransacLs buslness wlLh Lhe hlllpplnes, Lhe
approprlaLe governmenL agency llke Lhe SLC wlll requlre Lhe forelgn corporaLlon Lo deslgnaLe an agenL
ln Lhe hlllpplnes for purposes of servlce of summons. So a forelgn prlvaLe corporaLlon may noL be
allowed Lo LransacL buslness ln Lhe hlllpplnes and be glven permlsslon Lo LransacL buslness ln Lhe
hlllpplnes wlLhouL complylng wlLh Lhe requlremenL of deslgnaLlng a resldenL agenL.
Suppose Lhe resldenL agenL ln Lhe hlllpplnes ls noL avallable for one reason or anoLher? uled?
lncapaclLaLed? unavallable? Where wlll Lhe summons be served? 1he rule says LhaL Lhe summons now
may be served on Lhe governmenL agency Lasked by law for Lhls purpose. now whaL are Lhee
governmenL agencles referred Lo by SecLlon 12? 1hls may refer Lo lnsurance Commlsslon lf Lhe forelgn
corporaLlon dolng buslness ln Lhe hlllpplnes ls engaged ln lnsurance. 1he summons may be served on
Lhe lnsurance Commlssloner. lf Lhe forelgn corporaLlon ls engaged ln banklng buslness or flnanclal
lnsLlLuLlons, servlce of summons may be made upon Lhe SuperlnLendenL of 8anks or Lhe CenLral 8ank.
lor all oLher prlvaLe forelgn corporaLlon LransacLlng or dolng buslness ln Lhe hlllpplnes, servlce of
summon may be served upon Lhe SecurlLles and Lxchange Commlsslon. 1hese are governmenL agencles
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Lasked by law Lo recelve summons ln behalf of prlvaLe forelgn corporaLlons LransacLlng buslness ln Lhe
hlllpplnes.
Cr, oLher Lhan Lhe resldenL agenL or governmenL agency Lasked for Lhls purpose, servlce of summons
may be had also upon Lhe corporaLlon's offlcers, employees, or any oLher agenL.
So Lhere are Lhree posslble ways of servlng summons lf Lhe defendanL ls a forelgn prlvaLe corporaLlon
dolng buslness ln Lhe hlllpplnes. 1ake noLe however, LhaL Lhe agenL menLloned ln Lhe Lhlrd lnsLance ls
dlfferenL agenL menLloned ln Lhe flrsL. 1he flrsL agenL ls Lhe resldenL agenL deslgnaLed for LhaL purpose.
ln oLher words, Lhls musL refer Lo Lhe person deslgnaLed by Lhe forelgn corporaLlon ln Lhe SLC, lnsurance
Commlsslon, or SuperlnLendenL of 8anks. 8uL Lhe agenL menLloned ln Lhe Lhlrd, along wlLh offlcers and
employees may refer Lo anyone who acL ln behalf of Lhe forelgn prlvaLe corporaLlon. So a Lyplcal
example ls a forelgn prlvaLe corporaLlon engages Lhe servlces of some agenLs Lo do Lhelr buslness ln Lhe
hlllpplnes. 1hls agenL may noL be Lhe one deslgnaLed by Lhe corporaLlon lnsofar as Lhe SLC records are
concerned. 8uL conslderlng LhaL Lhls person ln some LransacLlons may have acLed ln behalf of Lhe
corporaLlon, he may be consldered an agenL of Lhe corporaLlon and upon whlch summons may be
valldly served. 1haL ls lnsofar as Lhe forelgn prlvaLe corporaLlon LransacLlng buslness ln Lhe hlllpplnes.
WhaL abouL lf Lhe forelgn prlvaLe corporaLlon ls noL reglsLered ln Lhe hlllpplnes? Cr ls noL resldenL of
Lhe hlllpplnes?
SecLlon 12 pursuanL Lo Lhe new amendmenL now provldes Lhe followlng modes of servlce of summons
upon Lhls klnd of corporaLlon.
1. ersonal servlce - personal servlce ln Lhe counLry where Lhls forelgn prlvaLe corporaLlon ls
based. Pow do you effecL Lhe personal servlce? uoes Lhe courL dlrecL lLs own sherlff Lo Lravel Lo
1lmbukLu Lo serve Lhe summons personally? under SecLlon 12, second paragraph, personal
servlce of summons ln Lhls lnsLance may be coursed Lhrough Lhe approprlaLe courL ln Lhe forelgn
counLry where Lhe defendanL ls dolng buslness or where may be found or locaLed, wlLh Lhe
asslsLance of course of Lhe ueparLmenL of lorelgn Affalrs. 1hls ls Lhe so called ulplomaLlc Servlce
of Summons wlLh Lhe asslsLance of ulA. So whaL happens here ls Lhe summons wlll acLually be
served by Lhe approprlaLe courL Lhere ln Lhe counLry where Lhe defendanL ls found, noL our own
sherlff here.
2. ubllcaLlon - publlcaLlon ln a newspaper of general clrculaLlon once ln Lhe counLry where Lhe
defendanL ls based, locaLed, or found. lf Lhe defendlng prlvaLe forelgn corporaLlon ls dolng
buslness holdlng prlnclpal offlce ln Cermany, Lhe summons musL be served Lhrough publlcaLlon
ln a newspaper of general clrculaLlon ln Cermany. 8uL Lhe servlce of summons Lhrough
publlcaLlon ls noL enough for Lhls purpose, because oLher Lhan publlcaLlon of Lhe summon, lL ls
also requlred under SecLlon 12 LhaL Lhe copy of Lhe order and Lhe summons lLself musL be senL
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Lhrough reglsLered mall Lo Lhe defendanL's lasL known address lf Lhe defendanL has any lasL
known address ln Lhe hlllpplnes.
3. lax/lacslmlle or any elecLronlc means capable of generaLlng proof of servlce. So lf lacebook ls
capable of generaLlng proof of servlce lf lL falls under Lhls mode
4. Any oLher mode as Lhe courL aL lLs dlscreLlon may dlrecL
1hese are Lhe 4 modes of servlce of summons lnsofar as a forelgn prlvaLe corporaLlon noL reglsLered, noL
resldenL ln Lhe hlllpplnes ls concerned.
LeL's go Lo servlce of summons lnsofar as lndlvldual defendanLs. 1he rules governlng servlce of summons
on naLural persons - defendlng parLles depends on wheLher Lhe naLural person ls a resldenL or noL.
lf Lhe defendlng parLy ls a naLural person ls resldenL ln Lhe hlllpplnes, how do you effecL Lhe servlce of
summons? Cf course you have Lhe personal servlce of summons, and lf Lhe personal servlce of summons
cannoL be effecLed wlLhln reasonable Llme, we may resorL Lo subsLlLuLed servlce.
WhaL abouL lf Lhe defendlng naLural person ls unknown, or ldenLlLy ls unknown, or hls whereabouLs are
unknown? 1he summons here may be served, wlLh leave of courL, Lhrough publlcaLlon.
WhaL abouL lf Lhe defendlng parLy ls a naLural person, a resldenL ln Lhe hlllpplnes, buL ls Lemporarlly
absenL ln Lhe hlllpplnes? under arLlcle (?) 16, 8ule 14, Lhe servlce of summons here may be (1)
exLraLerrlLorlal servlce, so Lhe summons may be served personally ouLslde of Lhe counLry, lL should be
served ln Lhe counLry where Lhe defendanL ls Lemporarlly found. So lf Mr. Sanchez ls a resldenL here ln
Lhe hlllpplnes buL ls Lemporarlly worklng ln !apan as an enLerLalner, servlce of summons here may be
resolved under SecLlon 16 ln relaLlon Lo secLlon 13. So whaL are Lhe allowable modes of servlce here?
1hls may lnclude exLraLerrlLorlal personal servlce, and second, by publlcaLlon, wlLh leave of courL, and
Lhlrd, any oLher mode of servlce as may be deLermlned or deemed approprlaLe by Lhe courL.
So Lhere are Lhree posslble ways of servlng summons lf a defendanL who ls a naLural person used Lo be
or ls a resldenL ln Lhe hlllpplnes buL Lemporarlly ouLslde.
WhaL abouL lf a defendanL ls a naLural person buL ls noL a resldenL here ln Lhe hlllpplnes? 1he rule
depends on wheLher Lhe acLlon where Lhe summons ls lssued ls an acLlon ln rem, quasl ln rem, or an
acLlon ln personam.
WhaL ls acLlon ln personam? WhaL ls acLlon ln rem?
uo noL confuse real acLlon wlLh acLlon ln rem. nelLher should you confuse personal acLlon wlLh acLlon ln
personam because Lhese are undersLood ln dlfferenL conLexLs. ulsLlngulsh acLlon ln personam ln relaLlon
Lo acLlon ln rem. And you dlsLlngulsh personal acLlon ln relaLlon Lo real acLlon. 1he classlflcaLlon of
acLlon, wheLher real or personal, depends on Lhe prlvlLy of Lhe basls acLlon. lf lL ls based on Lhe prlvlLy of
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real esLaLe or any lnLeresL Lhereln, lL ls real acLlon. 8uL lf lL ls based on Lhe prlvlLy of conLracL or personal
properLy, lL ls called personal acLlon.
Cn Lhe oLher hand, Lhe dlsLlncLlon beLween acLlon ln rem and acLlon ln personam ls based on Lhe
enforceablllLy of Lhe [udgmenL rendered ln Lhe acLlon. lf Lhe acLlon lnvolve Lhe personal llablllLy of Lhe
defendanL, and Lherefore Lhe [udgmenL ls enforceable agalnsL hlm personally, LhaL acLlon ls called acLlon
ln personam. And lf lL lnvolves a properLy (plece of land) lL ls real acLlon and aL Lhe same Llme acLlon ln
personam. lL ls real acLlon because lL ls based on Lhe prlvlLy of real properLy and aL Lhe same Llme lL ls
acLlon ln personam because Lhe [udgmenL LhaL may be rendered ln Lhls case ls enforceable agalnsL Lhe
person of Lhe defendanL based on hls personal llablllLy. 1yplcal example of Lhls klnd of acLlon ls acLlon
for quleLlng of LlLle of real properLy. 1he [udgmenL LhaL may be rendered Lhere ls enforceable only
agalnsL LhaL parLlcular defendanL. lL can never be blndlng agalnsL one who ls noL a parLy. So Lhe
[udgmenL LhaL may be rendered here ls only enforceable agalnsL Lhe defendanL who was glven due
process, parLlclpaLed, glven Lhe opporLunlLy Lo defend hlmself ln Lhe case. 8uL because lL ls based on Lhe
prlvlLy of real properLy lL ls also called real acLlon.
AcLlon ln rem ls an acLlon where a speclflc person ls named as Lhe defendanL buL Lhe purpose of acLlon ls
noL really Lo go agalnsL Lhe personal llablllLy of Lhe person named as defendanL buL acLually Lo sub[ecL
Lhe lnLeresL of Lhe defendanL Lo Lhe obllgaLlon or llen burdenlng Lhe properLy. So lL's acLually a [udgmenL
agalnsL Lhe properLy buL Lhe defendanL here who ls speclflcally named ln Lhe case has lnLeresL ln Lhe
properLy and Lhe acLlon ls lnLended Lo sub[ecL hls lnLeresL ln Lhe properLy Lo Lhe obllgaLlon sued upon. A
Lyplcal example here ls foreclosure of a morLgage. 1he defendanL Lhere has lnLeresL ln Lhe properLy buL
Lhe [udgmenL ls rendered agalnsL Lhe properLy lLself.
So when Lhe defendanL ls a naLural person and a non-resldenL defendanL, how do you serve summons
or how do Lhe courL acqulre [urlsdlcLlon over hlm? As l sald, lL depends on Lhe klnd of acLlon. lf Lhe
acLlon ls ln rem, or quasl ln rem, Lhe rule governlng Lhe servlce of summons ls LhaL under ArLlcle 13, 8ule
14. Pow do you serve summons Lo Lhls effecL? (1) exLraLerrlLorlal personal servlce - summons here may
be served ouLslde Lhe counLry or lL may be served ln Lhe counLry where Lhe defendanL may be found,
(2) by leave of courL, summons by publlcaLlon, and servlce of Lhe summons and Lhe order, Lhrough
reglsLered mall, send Lo Lhe defendanL's lasL known address and (3) by any oLher means LhaL Lhe courL
may deem approprlaLe. So Lhere are Lhree. WhaL are Lhe acLlons falllng under Lhese caLegorles (ln
rem/quasl ln rem)? ArLlcle 13 says, Lhose acLlons LhaL lnvolve Lhe sLaLus of Lhe plalnLlff llke acLlon for
nulllLy of marrlage. So lf Lhe husband of Lhe plalnLlff ls a forelgner and Lhe forelgner cannoL be found ln
Lhe hlllpplnes, Lhe servlce of summons, Lhls ls usually done ln cases of nulllLy of marrlage, ls served by
publlcaLlon because lL falls under arLlcle 13. Cr acLlons lnvolvlng properLy locaLed ln Lhe hlllpplnes
where Lhe defendanL has lnLeresL or a llen. Cr Lhe purpose of Lhe acLlon ls Lo exclude Lhe defendanL's
lnLeresL ln Lhe properLy locaLed ln Lhe hlllpplnes. Cr lf Lhe properLy of Lhe defendanL ls levled on
aLLachmenL. 1hls ls so called quasl ln rem. So lf Lhe acLlon falls under any of Lhese acLlons menLloned
!"#$%&'( "$ *+,- .&/(012 3456

)

under arLlcle 13, Lhls acLlon ls consldered acLlon ln rem or quasl ln rem and lf Lhe defendanL ls a naLural
person, noL resldlng ln Lhe hlllpplnes, Lhe servlce of summons may be had under any of Lhe Lhree
modes.
WhaL abouL lf Lhe defendanL ls a naLural person, noL resldlng ln Lhe hlllpplnes, buL Lhe acLlon ls ln
personam, an acLlon based on hls own personal llablllLy? Llke acLlon Lo collecL a sum of money. 1orL
acLlons. 1hese are acLlons based on Lhe personal llablllLy of Lhe defendanL. 1he only way by whlch
[urlsdlcLlon can be acqulred ls lf Lhe defendanL volunLarlly appears and submlLs hlmself Lo Lhe
[urlsdlcLlon of Lhe courL. Suppose noL? 1he only valld way ls personal servlce of summons ln Lhe
hlllpplnes, noL personal servlce ouLslde. Why? 1he reason here ls when Lhe acLlon ls ln personam, and
Lhe defendanL ls non-resldenL, noL found ln Lhe hlllpplnes, meanlng ouLslde Lhe [urlsdlcLlon of Lhe
hlllpplnes, our courL processes wlll noL Lake effecL ouLslde because Lhe power of our courLs are
coLermlnous wlLh Lhe LerrlLory of Lhe hlllpplnes. So summons ls a coerclve process of Lhe courL LhaL
cannoL Lake effecL ouLslde. So lf Lhe defendanL ls a non-resldenL and ls noL found, personal servlce
ouLslde ls noL allowed. nelLher ls summons by publlcaLlon. 1hls ls allowed only lf Lhe acLlon ls ln rem or
quasl ln rem under arLlcle 13. 8uL lf lL's acLlon ln personam, lf Lhe defendanL does noL submlL hlmself
volunLarlly, Lhe only way Lhe courL may acqulre [urlsdlcLlon ls by personal servlce whlch presupposes Lhe
defendanL's physlcal presence ln Lhe hlllpplnes. 1hls ls Lhe rullng ln Lhe case of
AslavesL LlmlLed vs. CourL of Appeals.
1hls case lnvolves Lhe enforcemenL of a forelgn [udgmenL obLalned by AslavesL agalnsL a cerLaln AnLonlo
Perras. 1hls forelgn [udgmenL was rendered by a courL ln Pongkong, and because Perras fled, obvlously
Lrylng Lo abscond, he reLurned Lo Lhe hlllpplnes. So Lhe case Lhere flled agalnsL hlm proceeded and
concluded. AslavesL obLalned a favorable [udgmenL. now, Lhls case arose from a conLracL beLween
AslavesL and AnLonlo Perras where Perras execuLed a conLracL of guaranLy. Pe guaranLeed Lhe
obllgaLlon of a prlnclpal debLor. So when Lhe prlnclpal debLor was lnsolvenL, AslavesL now sued Mr.
Perras on Lhe basls of hls guaranLy. AslavesL obLalned a favorable [udgmenL rendered by Lhe Pong kong
CourL. 8uL because Mr. Perras has no properLy ln Pong kong, and he can no longer be found ln Pk
because he reLurned Lo Lhe hlllpplnes, AslavesL now flled an acLlon before Lhe hlllpplne CourL for Lhe
enforcemenL of Lhe forelgn [udgmenL rendered by Lhe Pk courL. So Perras now ls served wlLh summons
by Lhe courL ln Lhe hlllpplnes ln relaLlon Lo Lhe acLlon for enforcemenL of forelgn [udgmenL. ln
proceedlngs lnvolvlng enforcemenL of forelgn [udgmenL where Lhere ls already [udgmenL rendered by
Lhe forelgn courL, and whaL ls only soughL here ls Lhe enforcemenL of LhaL forelgn [udgmenL, one of Lhe
defenses LhaL a defendlng parLy may lnLerpose Lo reslsL Lhe enforcemenL of a forelgn [udgmenL ls lack of
[urlsdlcLlon over hls person ln relaLlon Lo Lhe case Lhere (ln forelgn courL), noL ln relaLlon Lo Lhe case
here (ln Lhe hlllpplnes). 8ecause an acLlon for enforcemenL of a forelgn [udgmenL conLemplaLes of Lwo
courLs, of Lwo proceedlngs. 1he flrsL case ls Lhe one flled by AslavesL agalnsL Mr. Perras before Lhe Pong
kong courL.
!"#$%&'( "$ *+,- .&/(012 3456

*

Cne of Lhe defenses LhaL a defendlng parLy may lnLerpose Lo reslsL Lhe enforcemenL of a forelgn
[udgmenL ls +,-. /0 1234564-74/8 /9:3 ;45 <:35/8 ln relaLlon Lo Lhe case Lhere, noL ln relaLlon Lo Lhe case
here. 8ecause an acLlon for enforcemenL of forelgn [udgmenL conLemplaLes of Lwo courLs, lL
conLemplaLes Lwo proceedlngs. 1he flrsL case ls Lhe one flled by AslavesL agalnsL Mr. Peras before Lhe
Pong kong courL. ln LhaL case, Lhey also have Lhelr own rules on how Lo serve summons. When Lhe
[udgmenL was obLalned Lhere and AslavesL seeks Lhe enforcemenL of Lhe [udgmenL ln Lhe hlllpplnes ln
accordance wlLh our own rules here, summons wlll also have Lo be served on Lhe defendanL. 1he
defense LhaL a defendlng parLy may lnLerpose ln order Lo repel Lhe enforcemenL of a forelgn [udgmenL
ls, among oLhers, lack of [urlsdlcLlon over hls person ln relaLlon Lo LhaL case where a [udgmenL ls
rendered where lL ls soughL Lo be enforce ln Lhe hlllpplnes. ln oLher words, whaL Peras was saylng ls
LhaL Lhe Pong kong courL dld noL acqulre [urlsdlcLlon over hls person and Lherefore Lhe [udgmenL
rendered by Lhe Pong kong courL whlch AslavesL seeks Lo enforce ln Lhe hlllpplnes ls vold. And lL
cannoL be enforce ln Lhe hlllpplnes for lack of due process. 1he lssue ln Lhls case wheLher or noL Lhe
Pong kong courL acqulred [urlsdlcLlon over Mr. Peras ln relaLlon Lo Lhe case Lhere.
1hls ls a maLLer of procedure. So lf you are Lhe hlllpplne courL here, where Lhe acLlon for enforcemenL
ls flled, you'll ask lf Mr. Peras was properly served wlLh summons by Lhe Pong kong courL (?). 8uL Lhe
lssue here ls how Lo deLermlne lf Mr. Peras was served wlLh proper summons? Whose rule of servlce of
summons should govern, Lhe rules ln Lhe hlllpplnes on servlce of summons, or Lhe rules ln Pong kong
ln servlce of summons?
We have learned LhaL =,77:35 /0 <3/-:623: ,3: >/9:38:6 ?@ 7;: A,B /0 7;: 0/32=. ln oLher words,
quesLlons abouL procedure should be deLermlned by Lhe law of Lhe counLry where Lhe case ls flled. So
lnsofar as Lhe lssue on wheLher or noL Lhere was proper servlce of summons on Mr. Peras ln relaLlon Lo
LhaL Pong kong courL, Lhe law of Pong kong or rules of Pong kong ln servlce of summons should govern.
So Lhere ls now a reference Lo a forelgn law. Powever, Lhls ls only one of Lhe lssues here. lor purposes
Lhls of dlscusslon on [urlsdlcLlon, whaL happened ln Lhls case ls, whlle Lhls has been a maLLer of
procedure and should be governed by Lhe Pong kong law on servlce of summons, Lhere was fallure Lo
prove Lhe rules ln Pong kong ln servlce of Summons. So whaL happened here ls Lhe courL applled Lhe
rocessual resumpLlon and so, Lhe rules ln Lhe hlllpplnes of servlce of summons was Lhe one belng
applled here.
So Lhls ls whaL happened, when Mr. Peras anLlclpaLed of Lhe flllng of Lhe case agalnsL hlm, he lefL Pong
kong for Lhe hlllpplnes for good, and when AslavesL flled Lhe case and Mr. Peras cannoL be found ln
Pong kong, AslavesL ln accordance wlLh Lhelr own rules Lhere, caused Lhe servlce of summons of Peras
ln Lhe hlllppplnes. So Lhe summons lssued by Lhe Pong kong courL was personally served on Mr. Peras
ln Lhe hlllpplnes.
CuesLlon: 8ased on our rules of servlce of summons, ls lL a valld servlce of summons had Lhe case been
flled ln Lhe hlllpplnes and Lhe defendanL lefL ln Lhe hlllpplnes and sLayed ln Pong kong, and Lhe
!"#$%&'( "$ *+,- .&/(012 3456

!C

summons lssued by our own courL ls personally served by our sherlff Lhere? ls LhaL a valld servlce of
summons?
Supreme CourL sald LhaL obvlously Lhe acLlon flled agalnsL Mr. Peras ls an acLlon ln personam because lL
seeks Lhe enforcemenL of Peras's personal llablllLy under Lhe conLracL of CuaranLy. Pow was Lhe
summons for hlm served? Cbvlously lL was served by exLraLerrlLorlal servlce by personal servlce of
summons. 1he summons lssued by Lhe Pong kong courL was personally served on Mr. Peras ln Lhe
hlllpplnes. 1he SC sald lf Lhe 6:0:86,87 45 , 8,723,A <:35/8 ,86 8/7 3:546:87 of Lhe hlllpplnes, or ls noL
found ln Lhe hlllpplnes, Lhe only way by whlch Lhe courL acqulres [urlsdlcLlon over hls person ls elLher
Lhrough 9/A287,3@ ,<<:,3,8-: or 5:394-: /0 52==/85. 1hls servlce of summons conLemplaLed by law
refers Lo D:35/8,A E:394-: whlch presupposes Lhe physlcal presence of Lhe defendanL ln Lhe hlllpplnes.
ln Lhls case, Lhe summons was served, alLhough personally, buL ouLslde of Pong kong. So lL ls noL a valld
servlce of summons lnsofar as hlllpplne law ls concerned. 1he SC flnally ruled LhaL Lhe exLraLerrlLorlal
servlce of summons cannoL also be [usLlfled under SecLlon 16 of 8ule 14, whlch allows :F73,7:3347/34,A
5:394-: ln case Lhe 6:0:86,87 45 3:546:87 ?27 7:=</3,34A@ /27546:G When Lhe defendanL ls a 3:546:87 ?27
7:=</3,34A@ /27546:H Lhere 3 modes of servlce: LxLraLerrlLorlal Mode of Servlce, ersonal Servlce,
ubllcaLlon or any oLher means. 1he SC sald, Lhls provlslon cannoL also be lnvoked because when Mr.
Peras lefL Pong kong, lL was noL for a Lemporary Lrlp buL lefL Pong kong and sLayed ln Lhe hlllpplnes for
good or permanenLly. So LhaL [udgmenL ln shorL was noL recognlzed and enforced ln Lhe hlllpplnes
because Lhe SC ruled Lhere was no valld servlce of summons. And Lhe Pong kong courL has noL valldly
acqulred [urlsdlcLlon over Lhe person of Lhe defendanL, Mr.Peras. 8uL Lhls rule applles only lf Lhe
defendanL ls a non-resldenL defendanL.
1hls ls Lhe flrsL sLage ln Lhe [udlclal resoluLlon of a confllcL of law problem. ?ou have now [urlsdlcLlon. lf
Lhe forum courL deLermlnes LhaL afLer applylng all Lhe laws of Lhe forum courL, lL has no [urlsdlcLlon over
Lhe acLlon, Lhen lL has no cholce buL Lo dlsmlss Lhe case. Cn Lhe oLher hand, lf Lhe forum courL flnds LhaL
under Lhe exlsLlng laws of Lhe forum, Lhe courL has [urlsdlcLlon Lo Lake cognlzance of an acLlon lnvolvlng
forelgn elemenL, whaL ls Lhe courL supposed Lo do?
1he courL may choose Lo do any of Lhe followlng opLlons:
1. I9:8 7;: -/237 ;,5 6:7:3=48:6 0/3 475:A0 7;,7 47 ;,5 J234564-74/8H 47 =,@ 8/8:7;:A:55 3:025: 7/ 4=</5:
475 J234564-74/8 /8 7;: >3/286 /0 KLMNO PLP QLPRIPSIPE.
WhaL ls lorum non Convenlens?
lL llLerally means lnconvenlenL forum. 1hls prlnclple developed ln lnLernaLlonal law, emerged ln
cases ln order Lo prevenL Lhe pracLlce of forum shopplng. 8efore Lhls prlnclple came ouL, some llLlganLs
would resorL ln forum shopplng for a varleLy of mallclous reasons. LlLlganLs who are noL resldenL for LhaL
parLlcular SLaLe wlll flle Lhelr case Lhere elLher Lo harass or vex Lhe defendanL. So lf Mr. Sanchez has
!"#$%&'( "$ *+,- .&/(012 3456

!!

grlevance agalnsL Mr. Camlnade, ln order Lo vex Mr. Camlnade he wlll flle a case ln Cermany. So Mr.
Camlnade wlll be pre[udlced and wlll be force Lo spend expenses way beyond hls means. Cr even Mr.
Sanchez ls a llllplno, yeL he has some connecLlons ln Cermany where he can obLaln a favorable rullng
Lhere, he wlll flle a case ln Cermany even lf Lhe LransacLlon or parLles were llllplno clLlzens. So Lo avold
Lhls evll ln forum shopplng, Lhe prlnclple of forum non convenlens emerged.
under Lhls prlnclple, Lhe courL where Lhe acLlon ls flled may refuse Lo Lake cognlzance of Lhe
case and declde Lhe case lf lL belleves LhaL lL ls noL Lhe convenlenL forum LhaL Lhe parLles may resorL Lo
and lf lL flnds LhaL Lhe parLles can flle Lhelr acLlons somewhere else. So how does Lhe courL deLermlne
wheLher lL ls Lhe convenlenL or lnconvenlenL forum. 1here wlll be facLors, lf Lhe courL conslders Lhe
posslblllLy of noL lmposlng lLs [urlsdlcLlon on Lhe ground forum non convenlens, Lhe courL should
conslder Lhese 3 facLors:
,T U;: -/237 B4AA ;,9: 7/ -/8546:3 B;:7;:3 47 45 7;: =/57 -/89:84:87 0/32= 7;,7 7;: <,374:5 =,@
3:5/37 7/G
Pow does Lhe courL deLermlne wheLher such ls Lhe mosL convenlenL courL?
lL wlll have Lo deLermlne wheLher Lhe parLles wlll noL be lnconvenlenL ln golng Lo Lhe
courL. So lf Lhe parLles are non-resldenL, mosL llkely lL wlll glve Lhe courL an ldea LhaL Lhe parLles
may encounLer lnconvenlence ln appearlng before lL, or ln Lhe wlLnesses LhaL Lhe parLles may
presenL ln Lhe case cannoL be found ln Lhe hlllpplnes buL somewhere else, Lhen obvlously lL
may noL be convenlenL for Lhe parLles. Cr maybe Lhe evldence Lhe parLles lnLend Lo presenL
cannoL be found ln Lhe hlllpplnes buL somewhere else. So Lhe elemenL of convenlence Lhere ls
absenL.
?T U;: -/237 B4AA 6:7:3=48: 40 47 45 48 7;: ?:57 </5474/8 7/ 6:7:3=48: /3 7/ 6:-46: 7;: -,5: ,5 7/
7;: ,<<A4-,?A: A,B5 /3 7;: 0,-75 /0 7;: -,5:G
lf lL flnds LhaL lL ls noL ln Lhe besL poslLlon Lo declde Lhe case as Lo Lhe appllcable laws and Lhe
facLs lnvolved, Lhen Lhe courL may [usLlfy lLs non-proceedlng wlLh Lhe case on Lhe ground of
forum non convenlens.
-T U;: -/237 B4AA 6:7:3=48: B;:7;:3H ,552=48> 7;: <A,487400 /3 <,37@ <3:9,4A5 48 7;: 5247H 7;: -/237
;,5 ,6:V2,7: =,-;48:3@ 7/ :80/3-: 7;: J26>=:87G
Pow does Lhe courL deLermlne lf lL has adequaLe [udlclal machlnery Lo enforce Lhe [udgmenL?
Cne facLor Lo conslder ls Lhe facL B;:7;:3 /3 8/7 7;: 6:0:86,87 ;,5 5/=: <3/<:374:5 48
7;: D;4A4<<48:5 or lf Lhe 6:0:86,87 -,8 ?: 0/286 48 7;: D;4A4<<48:5. 8ecause lf Lhe defendanL
cannoL be found ln Lhe hlllpplnes, nelLher Lhe defendanL has any properLy ln Lhe hlllpplnes,
!"#$%&'( "$ *+,- .&/(012 3456

!#

Lhen obvlously, whaLever [udgmenL rendered by Lhe courL ln favor of Lhe plalnLlff cannoL be
adequaLely enforced.

lf Lhese 3 facLors or requlslLes are noL presenL, Lhe courL may [usLlfy lLs resorLlng Lo forum non
convenlens. 1hls ls Lhe rullng ln Lhe case of
OWPS+W XLUI+ 95G P+MQG
1hls lnvolves a llllplno who Lrled Lo make a llvlng ln Cman. Pe work Lhere ln a prlnLlng press and work as
a prlnLer. Whlle he was Lhere, he goL a [ob offer from a hoLel operaLlng ln 8el[lng, Chlna. Seelng Lhe
opporLunlLy of havlng a greener pasLure, Lhe llllplno grabbed Lhe opporLunlLy. Pe reslgned ln Cman and
slgned LhaL conLracL ln LhaL hoLel ln Chlna. Pe landed Lhe [ob Lhere ln Chlna. unforLunaLely for Lhls poor
llllplno, hls conLracL was LermlnaLed by reason of economlc reverses. 1he hoLel clalmed LhaL because of
Lhe pollLlcal upheaval LhaL happened ln LhaL place, Lhere buslness was adversely affecLed resulLlng ln Lhe
economlc reverses. So Lhe llllplno worker was LermlnaLed. Pe reLurned ln Lhe hlllpplnes and flled a
case agalnsL Lhe hoLel for lllegal dlsmlssal and some moneLary paymenLs. Cne of Lhe argumenLs ralsed
by Lhe hoLel Lhere ls forum non convenlens. lL argued LhaL Lhe hoLel ls noL dolng buslness ln Lhe
hlllpplnes, Lhe conLracL ls execuLed ouLslde ln Lhe hlllpplnes, lL was negoLlaLed ouLslde of Lhe
hlllpplnes and Lhe employmenL Look place ln Chlna. 1he dlsmlssal also Look place ouLslde of Lhe
hlllpplnes. 1he lssue was wheLher or noL forum non convenlens applles.
1he SC referred Lo Lhe 3 requlslLes. (1) WheLher Lhe nL8C ln Lhe hlllpplnes ls Lhe convenlenL forum LhaL
Lhe parLles may resorL Lo, (2) wheLher Lhe courL Lhe courL ln Lhe hlllpplnes ls ln Lhe besL poslLlon Lo
make an lnLelllgenL flndlng as Lo Lhe laws and facLs, (3) or wheLher Lhe courL ln Lhe hlllpplnes has Lhe
adequaLe machlnery Lo enforce Lhe [udgmenL.
LeLs go Lo Lhe flrsL requlslLe, Lhe SC sald LhaL obvlously Lhe nL8C of Lhe hlllpplne courL ls noL Lhe
convenlenL forum because all Lhe slgnlflcanL facLors of Lhe LransacLlon whlch Look place ouLslde of Lhe
hlllpplnes. 1he negoLlaLlon, conLracL slgnlng, dlsmlssal, place of Lhe conLracL, place of employmenL, eLc,
Look place ouLslde of Lhe hlllpplnes. 1he only llnk beLween abroad and Lhe hlllpplnes ls Lhe facL LhaL
Lhe employer ls a llllplno. 8uL all oLher componenLs of Lhe enLlre LransacLlon, evenL or conLroversy, Look
place ouLslde of Lhe hlllpplnes. So Lhe SC sald LhaL how can Lhe hlllpplne courL be a convenlenL forum?
Second, Lhe legal lssue Lhere ls on Lhe valldlLy of Lhe preLermlnaLlon of Lhe employmenL. 1he hoLel Lrled
Lo [usLlfy Lhe LermlnaLlon on Lhe ground of economlc reverses. 1he conLracL beLween Lhe hoLel and Lhe
llllplno worker ls governed by Lhe laws of Chlna whlch ls sLlpulaLed ln Lhe employmenL conLracL.
LxecuLed Lhere, performed Lhere, and Lhus ls governed by Lhe laws of Chlna. 8easonably, any lssue on
Lhe valldlLy of Lhe pre-LermlnaLlon should be governed by Lhe laws of Chlna. 1he SC sald, hlllpplne courL
may noL be ln Lhe besL poslLlon Lo deLermlne Lhe appllcable law ln Chlna. Second, nelLher ls Lhe
!"#$%&'( "$ *+,- .&/(012 3456

!$

hlllpplne courL compeLenL Lo deLermlne Lhe facLual lssues. 1he facLual lssues belng wheLher Lhere was
pollLlcal upheaval and wheLher such resulLed Lo economlc reverses whlch ls clalmed as Lhe [usLlflcaLlon
for Lhe LermlnaLlon. All Lhese facLs Look place ouLslde of Lhe hlllpplnes, ln Chlna. So how can Lhe
hlllpplne courL be compeLenL Lo make an lnLelllgenL flndlng as Lo Lhe facLual basls Lo Lhe lssue. So Lhe
second requlslLe ls absenL.
And Lhe Lhlrd, Lhe SC sald Lhe defendanL ls noL a resldenL of Lhe hlllpplnes, has no lnLeresL, no buslness,
and no properLy ln Lhe hlllpplnes. So assumlng Lhe llllplno worker prevalls ln Lhe case, [udgmenL of Lhe
courL may noL be adequaLely enforced ln Lhe hlllpplnes because Lhe defendanL ls based ln 8el[lng
Chlna. All Lhe requlslLes for Lhe courL Lo proceed Lo Lake cognlzance of Lhe case are absenL. lorum non
convenlens may be resorLed.
Cn Lhe conLrary, Lhe lnvocaLlon of Lhe prlnclple of forum non convenlens dld noL succeed ln Lhe case of
PWRSYW IU W+ 95G YSZLP IUG W+
1hls lnvolves a producL llablllLy LorL where Lhe forelgn defendanL ls a forelgn prlvaLe corporaLlon where
sued by llllplno farm workers. 1he llllplnos here are workers ln banana planLaLlon somewhere ln
Ceneral SanLos ClLy and uavao ClLy. 1hey clalmed LhaL because of Lhelr consLanL exposure Lo pesLlcldes
used ln Lhe planLaLlon, Lhey were affecLed wlLh Lhls klnd of lllness. And so Lhey sued Lhe manufacLurers
of Lhe esLlcldes. 1he cases were flled ln Ceneral SanLos whlle some were flled ln uavao ClLy lnsofar as
Lhose plalnLlffs who are based ln uavao ClLy. 1hese cases were consolldaLed. 1he common defense of
Lhe defendanL forelgn corporaLlon ls forum non convenlens clalmlng LhaL Lhey are noL dolng buslness ln
Lhe hlllpplnes slnce Lhey manufacLure Lhese producLs ouLslde. 1he lssue ls wheLher or noL Lhe
hlllpplne courL ls an lnconvenlenL courL.
1he SC agaln consldered Lhe 3 requlslLes. WheLher lL ls Lhe convenlenL courL where Lhe parLles can
resorL Lo, wheLher lL ls ln Lhe poslLlon Lo make lnLelllgenL flndlngs as Lo Lhe facLs and law appllcable, and
wheLher Lhe declslon may be enforced. 1he SC sald, rullng agalnsL forum non convenlens, all Lhe
requlslLes are presenL ln Lhls case. 1he plalnLlffs are all llllplnos resldlng ln elLher Ceneral SanLos ClLy or
uavao ClLy. 1he evldence as well as wlLnesses such as Lhe docLors, famllles, communlLy LhaL Lhe plalnLlff
may presenL are all avallable ln Lhe hlllpplnes. And so Lhe SC sald forum non convenlens may noL be
properly lnvoked by Lhe forelgn corporaLlon defendanL. 1he SC sald, whlle forum non convenlens may
be a basls for Lhe dlsmlssal, lL cannoL be lnLerposed as a ground for a moLlon Lo dlsmlss. Whlle Lhe courL
may dlsmlss an acLlon on Lhe basls of forelgn non convenlens, lL ls noL appoprlaLe Lo lnvoke Lhls forum
non convenlens ln a moLlon Lo dlsmlss because accordlng Lo Lhe SC ln Lhe cases of M,@7;:/8 95G M/2[4:H
case of P,946, :7 ,A 95G Y4[/8, and Lhe mosL of Lhe oLher cases, Lhe SC conslsLenLly held LhaL Lhe
dlsmlssal of an acLlon base on forum non convenlens requlres a facLual deLermlnaLlon of Lhe [usLlflcaLlon
Lhereof. ln oLher words, Lhe SC sald, forum non convenlence may noL be lnvoked ln a moLlon Lo dlsmlss
buL lL may be seL up as a maLLer of defense. So whaL should Lhe defendanL do, lf Lhe defendanL belleves
!"#$%&'( "$ *+,- .&/(012 3456

!%

LhaL Lhe forum courL ls an lnconvenlenL forum, ls Lo flle an answer and seL forLh forum non convenlens
as one of Lhe defenses. lL cannoL be lnvoke as a ground for moLlon Lo dlsmlss because Lhls ls noL among
Lhe grounds sLaLed ln Lhe 8ule 16. So whaL wlll happen here, as dlrecLed by Lhe SC ls for Lhe defendanL
Lo proceed Lo Lrlal and afLer Lhe Lrlal, Lhe courL wlll say Lhe courL ls lnconvenlenL, leL's dlsmlss Lhls."
8uL Lhls ls already well seLLled. ?ou cannoL geL Lhe dlsmlssal by flllng a moLlon Lo dlsmlss. ?ou really have
Lo go Lo Lrlals. So l have some procedural ob[ecLlon on Lhls because you wlll reallze LhaL forum non
convenlence, whlle maybe a basls for dlsmlssal has noLhlng Lo do wlLh Lhe merlLs of Lhe case. lL has
noLhlng Lo do wlLh Lhe rlghLs and obllgaLlons of Lhe parLles. lL's a separaLe lssue. WheLher Lhe forum non
convenlence ls appllcable ls a separaLe lssue, alLhough lL may requlre facLual deLermlnaLlon because
WCn Lhe forum courL ls a convenlenL forum needs a facLual basls.
lf Lhe concern of Lhe courL ls Lo comply wlLh Lhe requlremenL of facLual basls as a [usLlflcaLlon for Lhe
dlsmlssal on Lhe basls of forum non convenlens, Lhen l don'L Lhlnk our rules are devold of any oLher
remedy Lo achleve Lhls purpose wlLhouL golng Lhrough Lhe lengLhy proLracLed Lrlal. ln oLher words, lL ls
noL requlred or lL may noL be necessary aL all for Lhe defendanL Lo belleve LhaL forum non convenlence
ls appllcable, Lo burden Lhe defendanL ln havlng Lo go Lhrough Lrlal and ln Lhe process presenL evldence.
8ecause under rule 133 of Lhe rules of courL secLlon 7, Lhere ls LhaL remedy whlch allows evldence ln
moLlon. lL says Lhere LhaL when a moLlon ls based on facLs noL of record, Lhe courL may hear Lhe maLLer
on Lhe basls of Lhe affldavlLs, Lhe deposlLlons or oral LesLlmonles of wlLnesses. WhaL l'm saylng ls, lf l am
Lhe defendanL and l belleve LhaL Lhe forum ls really lnconvenlenL and l sLrongly belleve LhaL forum non
convenlens ls [usLlfled under Lhe clrcumsLances, why can'L l flle a moLlon Lo dlsmlss and ln LhaL moLlon
Lo dlsmlss ask for a hearlng where l can presenL evldence Lo prove Lhe facLual basls for a moLlon? 1hls ls
allowed because ln moLlon Lo dlsmlss, alLhough normally Lhe moLlon Lo dlsmlss may only be resolve by
Lhe courL on Lhe basls of Lhe pleadlngs, buL by vlrLue of sec. 3 rule 133, lf your ground for moLlon Lo
dlsmlss ls facLual, you can presenL evldence raLher Lhan go Lo Lrlal wlLh all Lhe lnconvenlence, expenses,
and Lhe agony, and aL Lhe end of Lhe Lrlal, afLer 3 yrs. Cr 10 yrs. Lhe courL wlll [usL dlsmlss lL because
afLer all lL's noL Lhe convenlenL forum. 1hen whaL's Lhe polnL of dlsmlsslng lL? When Lhe courL has
already caused lnconvenlence Lo Lhe parLles? l can'L see Lhe loglc behlnd Lhls rullng of Lhe Supreme
CourL. 8uL Lhey are Lhe Supreme CourL and Lhelr sLupldlLy ls Lhe law. ersonally l Lhlnk LhaL Lhls rullng
needs Lo be revlslLed. lL's really absurd Lo me. So LhaL's forum non convenlence.
lf Lhe courL flnds LhaL Lhe requlslLes are presenL, meanlng Lhe hlllpplne courL ls Lhe convenlenL courL, lL
ls ln Lhe poslLlon Lo make lnLelllgenL flndlngs as Lo facLs and laws lnvolve, and lL has adequaLe machlnery
Lo enforce lLs [udgemenL, Lhe courL now may proceed Lo exerclse lLs [urlsdlcLlon.
now, ln Lhe lnsLances of [urlsdlcLlon, Lhe courL wlll now go Lo Lhe merlLs of Lhe case. lL wlll now
deLermlne Lhe merlLs of Lhe case. AL Lhls sLage, Lhls ls Lhe 2
nd
sLage now. 1he 1
sL
sLage ls Lhe
deLermlnaLlon of Lhe [urlsdlcLlon and Lhe 2
nd
sLage now ls on Lhe merlLs. now whaL wlll happen here ls
Lhe deLermlnaLlon of Lhe proper laws appllcable. 1hls ls known as Lhe -;/4-: /0 A,B sLage. 1he courL now
!"#$%&'( "$ *+,- .&/(012 3456

!&

wlll deLermlne whaL law should govern ln Lhe deLermlnaLlon of Lhe lssue confronLlng Lhe courL. 1he
courL wlll now make a cholce of law.
l have Lo emphaslze Lhls, do noL ever commlL Lhe mlsLake commonly commlLLed by lawyers, ln cases
lnvolvlng forelgn elemenLs, when Lhe lawyer or Lhe parLy belleves LhaL Lhe law appllcable ls a law forelgn
law and noL hlllpplne law, Lhey wlll flle a moLlon Lo dlsmlss on Lhe ground of lack of [urlsdlcLlon. Llke, lf
a conLracL ls execuLed ln Cermany, Lhe parLles are all Cerman clLlzens, buL Lhe case ls flled here ln Lhe
hlllpplnes for breach of conLracL wlLh damages, mosL lawyers would flle a moLlon Lo dlsmlss argulng
lack of [urlsdlcLlon on Lhe parL of Lhe hll. CourL because Lhe law appllcable here ls Cerman laws. Slnce
Lhe parLles are Cerman, Lhe conLracL was execuLed Lhere, and under lex locl celebraclones, Lhe conLracL
ls governed by Cerman laws so Lhe courL has no [urlsdlcLlon. 1hls ls an obvlous dlsplay of
mlsundersLandlng of confllcL of laws rule.
1he lssue of WCn whaL law applles ls relevanL only ln Lhe 2
nd
sLage, Lhe cholce of law sLage. !urlsdlcLlon
ls ln Lhe 1
sL
sLage. WhaL l'm saylng ls lf Lhe courL has already deLermlned LhaL lL has [urlsdlcLlon on Lhe
basls of Lhe exlsLlng laws of Lhe forum, Lhe quesLlon of wheLher whaL law governs ln Lhe case ls noL an
lssue of [urlsdlcLlon buL ls an lssue of cholce of law. So lf you belleve LhaL Lhe appllcable law ls noL hll.
Law buL some law of a forelgn counLry, you cannoL ask for Lhe dlsmlssal of Lhe case on Lhe ground of
lack of [urlsdlcLlon because Lhe [urlsdlcLlon has already acqulred on Lhe basls of Lhe laws of Lhe forum.
So long as Lhe courL, on Lhe basls of Lhe exlsLlng laws of Lhe forum, has [urlsdlcLlon over Lhe naLure of
Lhe acLlon and Lhe person of Lhe parLles, lL has [urlsdlcLlon Lo proceed Lo Lry Lhe case. Also, ln Lhe
deLermlnaLlon of Lhe cholce of law, lL may deLermlne LhaL Lhe law appllcable ls Lhe law forelgn law noL
Lhe hlllpplne law. lL may have [urlsdlcLlon buL lL wlll apply forelgn law. 1here ls no confllcL Lhere
because as l've sald, Lhe maLLer of [urlsdlcLlon ls relevanL only on Lhe 1
sL
sLage. 1he maLLer of whaL law
should apply ls relevanL durlng Lhe 2
nd
sLage.
X,5:>,B, \ P4<</8 95G ]47,=23,
1hls lnvolves a conLracL beLween Lhe !apanese naLlonal and a !apanese employer. nlppon ls a !apanese
flrm and Pasegawa ls Lhe Lop ranklng offlcer of LhaL corporaLlon whlle klLamura ls Lhe complalnanL here.
klLamura enLered lnLo an lndependenL conLracL agreemenL wlLh nlppon. nlppon aL LhaL Llme underLook
cerLaln lnfrasLrucLure pro[ecL ln Lhe hlllpplnes. 8ecause Lhe lndependenL conLracLual agreemenL was
preLermlnaLed, klLamura complalned and flled a case agalnsL nlppon and Mr. Pasegawa. 1he acLlon was
for speclflc performance wlLh damages before Lhe hlllpplne courL Lo compel nlppon and Mr. Pasegawa
Lo conLlnue wlLh hls conLracL as an lndependenL conLracLor. Cn Lhe oLher hand, Lhe defendanLs flled a
moLlon Lo dlsmlss on Lhe ground of lack of [urlsdlcLlon and forum non convenlence.
Pow dld Lhe defendanLs [usLlfled Lhelr argumenL LhaL hlllpplne courL has no [urlsdlcLlon? 1hey sald LhaL
Lhe conLracL was execuLed ln !apan and under !"# !%&' &"!"()*&'%+", or !"# &%+-)*&-., Lhe conLracL ls
!"#$%&'( "$ *+,- .&/(012 3456

!'

governed by !apanese laws. And also, Lhe parLles are all !apanese. So Lhe deLermlnaLlon of Lhe valldlLy of
Lhe preLermlnaLlon of Lhe lndependenL conLracLual agreemenL ls governed by Lhe !apanese laws. Slnce
Lhe law appllcable ls Lhe law of !apan, hlllpplne courL has no [urlsdlcLlon.
1hls was brushed aslde by Lhe SC. 1he courL sald LhaL obvlously Lhe defendanLs are confuslng [urlsdlcLlon
wlLh cholce of law. !urlsdlcLlon ls Lo be deLermlned on Lhe basls of Lhe laws appllcable exlsLlng ln Lhe
hlllpplnes. ln so far as Lhe [urlsdlcLlon over Lhe sub[ecL maLLer or Lhe naLure of Lhe acLlon, Lhe SC sald
LhaL Lhls ls an acLlon for speclflc performance. And belng a speclflc performance Lhls ls an acLlon
lncapable of pecunlary esLlmaLlon and Lherefore lL falls under Lhe [urlsdlcLlon of Lhe 81C. SC sald LhaL Lhe
courL has [urlsdlcLlon. lf you are lnslsLlng LhaL Lhe law appllcable ls Lhe law of !apan, because of Lhese
prlnclples of !"# &%+-)*&-., and !"# !%&' &"!"()*&'%+", or Lhe mosL slgnlflcanL relaLlonshlp prlnclple, whlch
ls an lssue relevanL only ln Lhe cholce of law and noL a quesLlon of [urlsdlcLlon. ?ou don'L aLLack Lhe
[urlsdlcLlon of Lhe courL slmply because Lhe law appllcable are some forelgn laws. Cnce [urlsdlcLlon ls
deLermlned, quesLlon of whaL law should apply ls lrrelevanL anymore. So do noL confuse [urlsdlcLlon
wlLh cholce of law. 1he courL may have [urlsdlcLlon buL ln Lhe resoluLlon of Lhe case lL may apply some
forelgn law.
1he same rullng as observed wlLh fldellLy ln Lhe subsequenL case of
M,@7;:/8 S87:38,74/8,A 95G E7/-.7/8 M/2[4:
1hls lnvolves a conLracL beLween an Amerlcan corporaLlon and an Amerlcan clLlzen buL ln connecLlon
wlLh Lhe pro[ecL or underLaklng ln Lhe hlllpplnes. 8ayLheon Corp. wlLh anoLher one whlch were alleged
Lo be consldered as one enLlLy, bagged a conLracL ln Lhe hlllpplnes for Lhe dredglng of some rlvers as a
resulL of Lhe ML. lnaLubo erupLlon. So a conLracL was enLered lnLo wlLh Mr. 8ouzle.
Mr. 8ouzle alleged LhaL Lhere was a vlolaLlon of Lhe conLracL and so he flled an acLlon ln courL for
damages. 8y way of defense, Lhe defendanLs moved for Lhe dlsmlssal of Lhe case on Lhe ground of lack
of [urlsdlcLlon. Accordlng Lo Lhem, Lhe conLracL beLween Lhe corporaLlon and Mr. 8ouzle sLlpulaLes LhaL
maLLers or lssues or dlspuLes arlslng from Lhe conLracL should be governed by Lhe laws of ConnecLlcuL,
uSA. So based on Lhe !"# &%+-)*&-., prlnclple, Lhe defendanLs sald LhaL lL should be Lhe laws of Lhe uS
and Lherefore Lhe acLlon should be dlsmlss because Lhe hlllpplne courL has no [urlsdlcLlon.
Agaln Lhe SC sald LhaL obvlously Lhe defendanLs confused [urlsdlcLlon wlLh cholce of law. Whlle Lhe
conLracL expressly sLlpulaLes LhaL Lhe law appllcable ls Lhe law of ConnecLlcuL, lL has noLhlng Lo do wlLh
Lhe lssue on [urlsdlcLlon. 1he acLlon ls for damages arlslng from breach of conLracL and Lherefore lL falls
under Lhe [urlsdlcLlon of Lhe 81C.
^246:A48:5 48 7;: 6:7:3=48,74/8 /0 B;,7 A,B 5;/2A6 ,<<A@
!"#$%&'( "$ *+,- .&/(012 3456

!(

ln Lhe 2
nd
sLage, Lhe cholce of law sLage, Lhere are guldellnes LhaL may help Lhe forum courL Lo make a
proper cholce of law. 1here are some prlnclples LhaL Lhe courL should Lake lnLo conslderaLlon ln Lhe
deLermlnaLlon of whaL law should apply Lo resolve and lssue ralsed before hlm.
1. Lven lf Lhe
conLroversy ls one lnvolvlng forelgn elemenL, or Lhe so called Lhe confllcL of law slLuaLlon, and
where Lhe law appllcable should have been Lhe forelgn law, Lhere are lnsLances where Lhe
forum courL has no cholce buL Lo apply Lhe lnLernal law, meanlng Lhe laws of Lhe hlllpplnes noL
Lhe forelgn law. WhaL are Lhese lnsLances?

a. When Lhe forelgn law whlch should have been Lhe law appllcable ls noL properly alleged and
proved or even lf properly alleged buL noL proved, llke when ln Lhe case of successlon, Lhe
decedenL ls a Cerman naLlonal, under ArL. 16 lL says Lhere LhaL LesLamenLary successlon
should be deLermlned by Lhe naLlonal law of Lhe decedenL. So ln Lhls case, Lhe law of
Cermany ls appllcable. 8uL for one reason or anoLher, Lhe parLles falled Lo prove Lhe
Cerman law appllcable. So by applylng our own confllcL of laws rule parLlcularly ArLlcle 16,
second paragraph, Lhe law appllcable should have been Cerman law. 8uL because LhaL
parLlcular Cerman Law ls noL properly alleged or ls noL properly proved, Lhe forum courL has
no cholce buL Lo apply Lhe lnLernal law ln accordance wlLh Lhe prlnclple of processual
presumpLlon. 1hls ls Lhe flrsL lnsLance where Lhe forum courL has no cholce buL Lo apply our
own lnLernal law.
llrsL, how do you prove a forelgn law? AllegaLlon ls noL enough. A forelgn law musL be
properly auLhenLlcaLed. lor purposes of auLhenLlcaLlon, documenLs are classlfled lnLo Lwo -
publlc documenL and prlvaLe documenLs. 8ule 132, sec. 19 enumeraLes whaL are publlc
documenLs. 1hese are,
1. WrlLLen offlclal acLs or records of offlclal acLs of soverelgn auLhorlLles, publlc agencles or
publlc offlcers. So under 8ule 132 SecLlon 19, a forelgn law falls under Lhe flrsL caLegory
of a publlc documenL-WrlLLen offlclal acLs or records of offlclal acLs. lL ls an acL of
soverelgn auLhorlLy. A law ls an acL of a soverelgn auLhorlLy, an acL of a publlc offlcer.
Pow do you prove Lhls? under Sec. 24 of 8ule 132, a wrlLLen offlclal acL or record of an
offlclal acL of soverelgn auLhorlLy may be proved by 1) offlclal publlcaLlon. So lf you are a
parLy Lo Lhe case and you lnvoked a forelgn law, lL ls noL enough Lo allege lL. lL ls
necessary LhaL you have Lo prove lL by submlLLlng Lo Lhe courL Lhe offlclal publlcaLlon of
Lhe forelgn law. C8 lf you can'L presenL an offlclal publlcaLlon Lhen you can presenL, ln
lleu Lhereof, a cerLlfled copy of Lhe forelgn law whlch musL be aLLesLed by Lhe legal
cusLodlan. And because Lhls law ls kepL ouLslde Lhe hlllpplnes, Lhls musL be
accompanled wlLh Lhe cerLlflcaLlon lssued by Lhe hlllpplne consular offlcer sLaLloned ln
!"#$%&'( "$ *+,- .&/(012 3456

!)

Lhe counLry where LhaL record ls kepL. So Lwo documenLs necessary: 1) ALLesLaLlon and
2) cerLlflcaLlon. lf whaL ls used Lo prove ls a copy noL Lhe offlclal publlcaLlon, LhaL copy
musL be accompanled by Lwo requlremenLs, Lhe aLLesLaLlon and cerLlflcaLlon.

1he aLLesLaLlon ls made by Lhe legal cusLodlan. lL conLalns a sLaLemenL LhaL Lhe copy ls
Lhe correcL copy of Lhe orlglnal. 8uL pursuanL Lo SecLlon 24 8ule 132, slnce Lhls law ls a
forelgn law and ls kepL ouLslde of Lhe hlllpplnes, aLLesLaLlon of Lhe cusLodlan ls noL
enough under Lhe rule, lL musL be accompanled by a cerLlflcaLlon execuLed by Lhe
hlllpplne consular offlcer sLaLloned ln Lhe counLry where LhaL record/documenL ls kepL.
CerLlflcaLlon conLalns a sLaLemenL LhaL Lhe person who execuLed Lhe aLLesLaLlon has Lhe
legal cusLody. 1hese are sLrlcL requlremenLs of Lhe rule.

Are you famlllar wlLh Lhe forelgn documenL conLalnlng a red rlbbon? 1haL ls exacLly
whaL ls conLemplaLed ln auLhenLlcaLlon of forelgn documenLs. WhaL happens lf a forelgn
documenL ls presenLed wlLhouL Lhls red rlbbon? lL cannoL be admlLLed by Lhe courL for
fallure Lo auLhenLlcaLe. So Lhere was a case where when lL was flled by an agenL
pursuanL Lo speclal power of aLLorney, Lhe prlnclpal was already based ln Lhe uS and so
he auLhorlzed a relaLlve Lo flle a case ln hls behalf ln Lhe hlllpplnes. Pe execuLed a
speclal power of aLLorney buL slnce LhaL power of aLLorney dld noL conLaln a red rlbbon,
Lhe courL dlsmlssed Lhe case because Lhere was no proof of auLhorlLy for a cerLlflcaLlon
of non forum shopplng. 1he parLy who execuLed Lhe cerLlflcaLe of non forum shopplng
was ln abroad. So whaL he dld, he submlLLed Lhe cerLlflcaLlon whlch ls slgned abroad
wlLhouL Lhe requlred red rlbbon. So Lhe courL dlsmlssed Lhe case for lack of cerLlflcaLlon
of non forum shopplng. AuLhenLlcaLlon Lherefore ls very lmporLanL. 1he same
lmporLance ln provlng a forelgn law ln a confllcL of law slLuaLlon.

lf lL ls an unwrlLLen forelgn law, how do you prove lL? lL maybe proved by Lhe 1)
LesLlmony of an experL. As ln Lhe case of AslavesL, Lhey Lrled Lo prove Lhe rules ln
Pongkong on Lhe servlce of summons. 1he defendanLs presenLed an experL wlLness
supposedly Lo prove Pongkong law on servlce of summons alLhough Lhe wlLness falled
Lo prove lL. 1he courL was noL convlnced LhaL Lhe law of Pongkong was proved by Lhe
wlLness. 8uL my polnL ls Lhe law may also be prove by LesLlmony of a wlLness. And also lL
may be prove by 2) prlnLed and publlshed reporLs of Lhe declslon of a forelgn courL
provlded lL ls shown Lo be commonly admlLLed ln LhaL counLry. So ln Lhe hlllpplnes, we
have Lhe SC8A.
llrsL rlnclple: When Lhe local forum has no opLlon buL Lo apply Lhe lnLernal law even lf upon Lhe
appllcaLlon of Lhe perLlnenL confllcL of laws rule, Lhe law appllcable should have been Lhe approprlaLe
!"#$%&'( "$ *+,- .&/(012 3456

!*

forelgn law ls when Lhe forelgn law appllcable ls noL duly alleged or proved or even lf duly alleged buL
noL duly proved. We already Look LhaL up.
lf Lhere ls fallure Lo prove Lhe forelgn law, LhaL's Lhe Llme LhaL Lhe forum courL wlll apply processual
presumpLlon, ln whlch case Lhe forum courL assumes LhaL Lhe approprlaLe forelgn law ls Lhe same as
ours and apply our own lnLernal laws ln Lhe case ralsed. 1hls ls Lhe case of
_,/ ]:; 95 ^/8[,A:5G
ln Lhls case, lL lnvolves Lhe esLaLe of a Chlnaman named Sy klaL. upon hls deaLh, he was survlved by Lwo
groups of helrs, Lhe group of Alda Conzales, clalmlng Lo be Lhe chlldren of Sy klaL, and Lhe oLher one as
Lhe leglLlmaLe wlfe of Lhe decedenL. ln an efforL Lo prove her sLaLus as a leglLlmaLe wlfe (or daughLer?),
?ao kee, LesLlfled ln courL how her alleged marrlage Lo Sy klaL Look place. She LesLlfled LhaL lL happened
ln Chlna accordlng Lo Chlna's cusLoms and laws. She also LesLlfled LhaL her marrlage was solemnlzed ln
such a way LhaL Lhere was no solemnlzlng offlcer. 1he parLles were made Lo slgn Lhe marrlage conLracL
only. Allegedly, Lhls was Lhe laws and cusLoms of Chlna on marrlage. Powever, Lhe SC found LhaL Lhere
was lnsufflclenL evldence lnLroduced Lo prove Lhe facL of marrlage lnsofar as lL allegedly complled wlLh
Lhe laws of Chlna on marrlage because ?ao kee falled Lo prove ln accordance wlLh Lhe rules Lhe alleged
laws ln Chlna or cusLoms ln Chlna on marrlage.
1he lssue was wheLher or noL ?ao kee was valldly marrled Lo Sy klaL ln accordance wlLh Lhe alleged
Chlnese laws or Chlnese CusLoms. 1hls lssue ls relevanL Lo deLermlne WCn she has Lhe legal personallLy
Lo ask for Lhe leLLers admlnlsLraLlon over Sy klaL's esLaLe. So Lhe valldlLy of marrlage was ralsed before
Lhe courL. now, how dld SC resolve on WCn ?ao kee was valldly marrled Lo Sy klaL?
1he SC applled Lhe prlnclple of processual presumpLlon and assumed LhaL Lhe law ln Chlna on marrlage
ls Lhe same as LhaL ln Lhe hlllpplnes. Slnce lL was esLabllshed LhaL Lhe alleged marrlage was celebraLed
wlLhouL a solemnlzlng offlcer, Lhe SC sald LhaL applylng our own lnLernal law on marrlage, speclflcally
Lhe lamlly Code, concluded LhaL Lhe marrlage of Sy klaL and ?ao kee ls vClu for lack of an essenLlal
formal requlslLe of marrlage whlch ls LhaL Lhe marrlage musL be solemnlzed by a solemnlzlng offlcer.
1he absence of Lhe solemnlzlng offlcer renders Lhe marrlage beLween Sy klaL and ?ao kee vold.
1he same rullng ln Lhe case of
WUQS L9:35:,5 95 I-;:8G
1hls lnvolves an overseas employmenL conLracL. A llllplno medlcal LechnologlsL was hlred Lo work as a
medLech ln kuwalL. lor Lhe mlnlsLry of healLh of Lhe governmenL of kuwalL. She was hlred flrsL as
probaLlonary employee. AfLer worklng for some Llme, her employmenL was LermlnaLed. Accordlng Lo
Lhe conLracL, Lhe Lerms and condlLlons of Lhe employmenL was supposed Lo be governed by Lhe clvll
!"#$%&'( "$ *+,- .&/(012 3456

#C

servlce laws of kuwalL. Per employmenL was LermlnaLed on Lhe basls of Lhe Clvll Servlce laws of kuwalL.
She Lhen reLurned Lo Lhe hlllpplnes and sued Lhe recrulLer and Lhe prlnclpal for lllegal dlsmlssal and
some oLher moneLary clalms.
Cne of Lhe lssues ralsed was wheLher or noL Ms. Lchen was valldly LermlnaLed. 1he respondenLs clalmed
LhaL she was valldly LermlnaLed ln accordance wlLh Lhe Clvll Servlce laws of kuwalL where Lhe
employmenL of Lchen Look place. 1he problem was Lhere was fallure Lo prove Lhe alleged laws of kuwalL
whlch governs Lhe employmenL conLracL. So Lhe SC wenL on Lo apply Lhe prlnclple of processual
presumpLlon and applled our lnLernal law on Labor.
lL was found LhaL under hlllpplne laws, Lhere was no basls aL all for Lhe LermlnaLlon of Lhe servlces of
Lchen because even under our own laws, even lf Lhe employmenL ls only probaLlonary, lL cannoL be
LermlnaLed wlLhouL [usL cause and due process. ln Lhls case, Lhere was no showlng LhaL Lhe LermlnaLlon
of her employmenL was for a [usL cause.
1he same prlnclple ln
WYS E7/-. `24A6:35G
1hls also lnvolves Lhe employmenL of a llllplno who was employed as a compuLer speclallsL ln Saudl
Arabla. Pls employmenL was LermlnaLed on Lhe ground of abandonmenL or lncompeLence. So he was
LermlnaLed and reLurned Lo Lhe hlllpplnes and flled for lllegal dlsmlssal and asked for moneLary
beneflLs. 1he respondenL counLered LhaL he was lncompeLenL and was gullLy of lnsubordlnaLlon, Lhus
properly LermlnaLed. 1he LermlnaLlon was allegedly pursuanL Lo Saudl Arablan laws. 1he respondenL
alleged LhaL Lhe conLracL was governed by Lhe laws of employmenL ln Saudl Arabla.
unforLunaLely for Lhe respondenL, Lhey falled Lo prove Lhe appllcable Saudl Arablan laws so Lhe SC
applled Lhe prlnclple of processual presumpLlon and assumed LhaL Lhe laws ln Lhe Saudl Arabla are Lhe
same as Lhose ln Lhe hlllpplnes. Pere, LermlnaLlon ls valld only lf Lhere ls [usL and lawful cause and
effecLed wlLh due process. ln Lhls case, Lhe respondenLs falled Lo prove [usL cause (lncompeLence and
lnsubordlnaLlon) and due process.
ln all Lhese cases, Lhe SC ruled LhaL when a parLy falls Lo prove Lhe appllcable forelgn law, Lhe prlnclple
of processual presumpLlon applles and lL has Lo assume LhaL Lhe laws ln Lhe forelgn counLry are Lhe
same as ln Lhe hlllpplnes and lL wlll apply Lhe hlllpplne laws ln decldlng Lhe case. 1haL's processual
presumpLlon.

LeL's go Lo Lhe second lnsLance. 1he second lnsLance where even lf Lhe approprlaLe law appllcable ls LhaL
of a forelgn law buL Lhe lnLernal law of Lhe forum (Lhe hlllpplne courL) has no cholce buL Lo apply Lhe
!"#$%&'( "$ *+,- .&/(012 3456

#!

lnLernal law. Lhe second lnsLance ls when Lhe appllcaLlon of Lhe forelgn law falls under Lhe excepLlon or
Lhe case falls under Lhe excepLlon from Lhe appllcaLlon of Lhe forelgn law.
As a general rule, a forelgn law may be recognlzed and applled ln Lhe hlllpplnes.
AlLhough Lhls may consLlLuLe a derogaLlon of Lhe soverelgnLy of Lhe sLaLe buL even lf a
general rule, Lhe sLaLe ls supreme and Lhe laws of Lhe forelgn sLaLe cannoL be applled ln Lhe
former's [urlsdlcLlon, Lhere are [usLlflcaLlons for Lhe law recognlzlng Lhe appllcaLlon of forelgn
laws ln Lhe forelgn sLaLe.
Pow dld experLs [usLlfy Lhe legal reallLy LhaL Lhe law of one counLry may be recognlzed
and enforced ln anoLher counLry?
1heorles:
1. 1heory of comlLy - Lhe laws of one's sLaLe may noL be enforced ln Lhe
LerrlLory of anoLher sLaLe unless Lhe laLLer sLaLe consenLs ouL of respecL Lo
Lhe soverelgnLy of Lhe oLher sLaLe. 1hls Lheory ls based on Lhe noLlon LhaL
members of Lhe lnLernaLlonal communlLy owe respecL Lo Lhe oLher
members. When Lhe law of one sLaLe ls applled ln anoLher sLaLe, lL ls noL
deemed Lo be a derogaLlon of Lhe soverelgnLy of anoLher sLaLe because Lhe
laLLer sLaLe consenLed Lo Lhe appllcaLlon of Lhe laws of Lhe oLher sLaLe
2. 1heory of vesLed rlghLs - under Lhls Lheory, one sLaLe may apply a forelgn
law or one sLaLe may recognlze or enforce a forelgn law ln lLs own domaln,
noL because LhaL law ls forelgn or because LhaL [udgmenL ls rendered ln a
forelgn courL, buL because of Lhe rlghLs vesLed under LhaL forelgn law or
LhaL forelgn [udgmenL. 1hls ls based on Lhe premlse LhaL once a rlghL ls
vesLed or creaLed by vlrLue of a forelgn law, LhaL rlghL musL be enforced
wherever Lhe sulL lnLended for Lhe enforcemenL of Lhe rlghL may be flled.
SC when a sulL ls lnlLlaLed ln pursuance of Lhe laws of x sLaLe, lL doesn'L
maLLer where a sulL ls lnlLlaLed for Lhe purpose of enforclng LhaL rlghL, lL
may be flled ln SLaLe 8, C or Z. 1here ls no derogaLlon of soverelgnLy ln LhaL
laLLer sLaLe because whaL ls belng recognlzed ls noL really Lhe laws of Lhe
oLher sLaLe buL Lhe rlghLs creaLed by Lhe laws of Lhe oLher sLaLe.
3. 1heory of local law - under Lhls Lheory, Lhe forum allows Lhe appllcaLlon or
enforcemenL of Lhe laws of anoLher counLry, noL because lL's Lhe law of Lhe
oLher counLrles (so lL ls noL a manlfesLaLlon of lLs subservlence Lo Lhe oLher
counLry) buL because ln applylng lLs slmllar lnLernal law on Lhe maLLer, lLs
own lnLernal law dlrecLs Lhe courL Lo apply Lhe forelgn law. So, ln Lhe flnal
analysls, lL's noL Lhe forelgn law whlch ls applles buL raLher Lhe lnLernal law
!"#$%&'( "$ *+,- .&/(012 3456

##

whlch sLaLes LhaL ln LhaL parLlcular slLuaLlon, whaL musL be applled ls Lhe
forelgn law.
4. 1heory of harmony of laws - Lhls ls premlsed on Lhe noLlon LhaL Lo ensure
harmony of laws, slmllar problems should be glven or afforded Lhe same
soluLlons. SC lf Lhls wlll enLall Lhe appllcaLlon of a forelgn law for Lhe
purpose of harmonlzlng laws, Lhere would be no derogaLlon of soverelgnLy
of Lhe recognlzlng sLaLe.
3. 1heory of !usLlce - under Lhls Lheory, lL doesn'L maLLer LhaL Lhe local forum
applles or recognlzes a forelgn law so long as lL serves Lhe ends of [usLlce.
1hls recognlzes Lhe overrldlng preference of [usLlce over soverelgnLy.
1hese are Lhe varlous Lheorles LhaL [usLlfy Lhe legal reallLy LhaL forelgn laws, desplLe Lhe soverelgnLy of
Lhe oLher sLaLe, may be applled, recognlzed or enforced ln anoLher sLaLe's LerrlLory. 8u1 Lhls rule has
well recognlzed excepLlons. 1here are lnsLances when a forelgn law may noL be applled, enforced or
recognlzed ln Lhe local forum (hlllpplne courL).
LxCL1lCnS: (Lo Lhe local appllcaLlon of forelgn law)
1. When Lhe forelgn law runs counLer Lo Lhe sound and esLabllshed publlc pollcy of Lhe forum.
a. Lven lf afLer applylng Lhe forum's lnLernal or confllcL of laws rule, Lhe forum courL
deLermlnes LhaL Lhe appllcable law ls Lhe forelgn law, lf LhaL forelgn law runs counLer Lo
Lhe esLabllshed pollcy of Lhe forum, lL falls under Lhe excepLlon, and Lhe forum courL ls
mandaLed Lo apply Lhe lnLernal law lnsLead of Lhe forelgn law.

1hls was applled ln Lhe case of
W=:34-,8 `,8. 95 W=:34-,8 M:,A7@ Q/3<G
1hls lnvolves a dlspuLe beLween a bank and Lhe borrowers. Amerlcan 8ank, a forelgn corporaLlon,
exLended loans Lo Lhree varlous borrowers. All Lhe debLors are forelgn corporaLlons. lor falllng Lo obLaln
Lhe loan, Lhe bank and Lhe Lhree borrowers enLered lnLo a resLrucLurlng agreemenL. And parL of Lhe
resLrucLurlng agreemenL was Lhe condlLlon lmposed by Lhe bank LhaL Lhe Lhree borrowers musL secure a
Lhlrd parLy Lo guaranLy Lhe paymenL of Lhe loan obllgaLlon. Amerlcan 8ealLy CorporaLlon, a domesLlc
corporaLlon based ln Lhe hlllpplnes came lnLo Lhe plcLure.
ln accordance wlLh Lhe resLrucLurlng agreemenL, Amerlcan 8ealLy execuLed a real esLaLe morLgage over
lLs properLles locaLed ln Lhe hlllpplnes. lasL lorward: When Lhe due daLe ln Lhe resLrucLurlng
agreemenL fell due, Lhe borrowers sLlll falled Lo pay Lhelr obllgaLlons. So Lhe bank lnsLlLuLed collecLlon
sulLs agalnsL Lhe borrowers ln varlous courLs (Pong kong, Lngland). 1here were acLually Lhree collecLlon
!"#$%&'( "$ *+,- .&/(012 3456

#$

sulLs flled. Whlle Lhese collecLlon sulLs were lnsLlLuLed abroad and pendlng, Lhe bank slmulLaneously
lnsLlLuLed forclosure of Lhe reals esLaLe morLgages lnsLlLuLed by Amerlcan 8ealLy lnvolvlng Lhe properLles
ln Lhe hlllpplnes. 1he properLles were foreclosed and Lhe ownershlp was consolldaLed ln Lhe bank.
SubsequenLly, Amerlcan 8ealLy flled an acLlon for damages agalnsL Lhe bank, conLendlng LhaL Lhe
foreclosure of Lhe real esLaLe morLgage lnvolvlng lLs properLles locaLed ln Lhe hlllpplnes was vold on
Lhe ground LhaL Lhe bank was noL supposed Lo avall of Lhls remedy, conslderlng LhaL lL already lnsLlLuLed
collecLlon sulLs abroad agalnsL Lhe borrowers.
Cbvlously, Amerlcan 8ealLy lnvoked Lhe fundamenLal prlnclple ln our [urlsdlcLlon LhaL a credlLor, when
Lhe credlL or obllgaLlon ls noL pald by Lhe debLor, has Lhe remedy of Ll1PL8 golng agalnsL Lhe debLor for
collecLlon of Lhe debL, or, ln Lhe alLernaLlve, foreclose Lhe morLgage. 1hese remedles cannoL be
slmulLaneously avalled of by Lhe credlLor. AvallmenL of one closes Lhe avallablllLy of Lhe oLher.
lor lLs parL, Lhe bank argued LhaL Lhe provlslons of Lhe resLrucLurlng agreemenLs expressly sLlpulaLe LhaL
Lhe relaLlonshlp should be governed by Lhe laws of Lngland so LhaL any dlspuLe LhaL may arlse beLween
Lhe parLles regardlng Lhelr agreemenL should be governed by Lngllsh Laws. Accordlng Lo Lhe bank, under
Lngllsh laws, Lhe remedy Lo flle a collecLlon sulL and aL Lhe same Llme foreclose Lhe morLgage may be
avalled of slmulLaneously.
1he lssue here ls WCn Lhe foreclosure of Lhe real esLaLe morLgage consLlLuLed by Amerlcan 8ealLy ls
valld. 1he SC sald nC". 1he SC ruled LhaL whlle lL may be Lrue LhaL under Lhe conLracL, under Lhe
prlnclple of lex conLracLus, Lhe Lerms and condlLlons are supposed Lo be governed by Lhe laws of
Lngland, buL Lhen, Lhls falls under Lhe excepLlon Lo Lhe appllcaLlon of Lhe forelgn law because Lhls law
allowlng slmulLaneous avallmenL of remedles by Lhe credlLor runs counLer Lo Lhe sound and esLabllshed
pollcy of Lhe forum. lL runs counLer Lo Lhe publlc pollcy ln Lhe hlllpplnes whlch ls Lhe <3/5-34<74/8 /8
7;: 5<A47748> , 548>A: -,25: /0 ,-74/8G ln spllLLlng a cause of acLlon, when Lhe debLor falls Lo pay Lhe
obllgaLlon, Lhe credlLor has only one cause of acLlon buL he may avall of Ll1PL8 collecLlon or
foreclosure, one of elLher remedles, noL boLh.
1hls creaLed a slLuaLlon where, even lf Lhe appllcable law should be Lhe forelgn law (because lL ls
obvlous here LhaL Lhe relaLlonshlp of Lhe parLles was governed by Lngllsh law on Lhe base of Lhe
conLracL) buL Lhe SC sald LhaL Lhe Lngllsh law runs counLer Lo Lhe publlc pollcy of Lhe forum, and ls
Lherefore noL appllcable ln Lhe hlllpplne [urlsdlcLlon.
Also, ln Lhe case of
Q,6,A48 95 DLIW,
Lhls case also lllusLraLes a slLuaLlon for Lhe excepLlon of Lhe appllcaLlon of Lhe forelgn law. Pere ls a class
sulL of numerous overseas llllplno workers worklng ln 8ahraln ln Lhe hlllpplnes. When Lhelr
employmenLs were LermlnaLed, Lhey reLurned Lo Lhe hlllpplnes and sued under Lhe Labor courLs and
!"#$%&'( "$ *+,- .&/(012 3456

#%

Lhe CLA. Cne of Lhe lssues ralsed before Lhe courL was WCn Lhe acLlons flled by Lhe llllplno workers
have already prescrlbed. 1here were Lhree laws lnvolved here and Lhey are all confllcLlng.
1. 1he laws of 8ahraln (Amerl uecree) -provldes LhaL cases of Lhls naLure can only be flled wlLhln 1
year
2. Labor Code of Lhe hlllpplnes - cases of Lhls naLure prescrlbe ln 3 years
3. Clvll Code - 10 years
Cbvlously, Lhe law appllcable should have been Lhe law of 8ahraln. AS a maLLer of facL, Lhe beneflLs
clalmed by Lhe plalnLlffs were based on Lhe beneflLs Lhey recelve under 8ahraln laws. 8uL Lhe SC sald Lhe
one year prescrlpLlve perlod provlded for under Lhe Amerl uecree, lf applled would run counLer Lo Lhe
publlc pollcy of Lhe forum and LhaL pollcy belng Lhe roLecLlon Lo Labor whlch ls consLlLuLlonal ln orlgln.
ln oLher words, lL runs counLer agalnsL Lhe consLlLuLlonal mandaLe for roLecLlon Lo Labor.

Also, ln
+a Q/85732-74/8 95 Y2</G
1hls lnvolves a llllplno worker who served as sLrucLural consulLanL ln Saudl Arabla. AfLer worklng Lhere
for someLlme, he reslgned and, lnvoklng Lhe Arablan Law, he clalms for Lhe paymenL of Lhe servlce
award, ln accordance wlLh Lhe Saudl Arablan Laws. 1he respondenL alleged LhaL under Lhe Saudl Arablan
Law, clalms for servlce award should be flled wlLhln 1 year from Lhe LermlnaLlon of Lhe employmenL.
And obvlously, Lhe employmenL beLween Lhe parLles ls governed by conLracL and applylng lex
conLracLus, Lhe law appllcable here ls Lhe law of Saudl Arabla.
1he SC refused Lo apply Lhe 1 year prescrlpLlve perlod of 1 year under Lhe Saudl Arablan Laws, lnvoklng
Lhe prlnclple LhaL when Lhe forelgn law runs counLer Lo Lhe sound esLabllshed publlc pollcy of Lhe forum,
LhaL forelgn law may noL be applled ln Lhe resoluLlon of dlspuLe before Lhe local forum. Llke ln Cadalln,
Lhe prlnclple ls Lhe prlnclple of roLecLlon Lo LAbor.
All Lhese cases demonsLraLe Lhe slLuaLlon where Lhe forelgn law, even lf approprlaLe Lo be applled Lo Lhe
currenL lssue, may noL be applled by Lhe courL on Lhe basls LhaL lL runs counLer Lo publlc pollcles of Lhe
local forum.
2. When Lhe forelgn law runs counLer Lo Lhe unlversally recognlzed prlnclples of morallLy
a. When a forelgn law legallzes prosLlLuLlon, lL may noL be enforced ln Lhe hlllpplnes
under Lhls ground. lL ls consldered Lo be unlversally lmmoral pracLlce.
b. When a forelgn law legallzes corrupLlon.
3. When Lhe forelgn law ls procedural ln naLure
!"#$%&'( "$ *+,- .&/(012 3456

#&

a. So lf a case ls flled ln Lhe hlllpplnes, Lhe procedural aspecLs of Lhe proceedlngs should
be governed by hlllpplne law, even lf Lhe parLles lnvolved are forelgners. 1hls ls
because of Lhe prlnclple of lex forae. 1he reason here ls obvlous. Pow can Lhe local courL
be expecLed Lo follow Lhe procedure of forelgn courLs?
4. When Lhe forelgn law ls penlle :lol: penal ln naLure
a. 1hls means laws LhaL deflnes and penallzes crlmes. 1he obvlous reason here ls LhaL we
adhere Lo Lhe 1errlLorlallLy prlnclple. So lf Lhe crlme ls commlLLed here ln Lhe
hlllpplnes, lL ls Lo be penallzed under hlllpplne law, lf commlLLed ln Chlna, Lhen
Chlnese laws.
b. So lf a Cerman naLlonal ls prosecuLed, he cannoL lnslsL LhaL Lhe case ls Lo be governed
by Cerman law. Crlmlnal law belng LerrlLorlal, Lhe [urlsdlcLlon over lL should be exerclsed
by Lhe counLry ln whlch Lhe crlme ls commlLLed.
3. When Lhe forelgn law ls lnLernal ln naLure
a. 1ax and admlnlsLraLlve laws.
b. 1ax laws - so Lax laws ln Lhe uS may noL be applled ln Lhe hlls. 1hese are maLLers
lnLernal Lo Lhe affalrs ln Lhe uS.
c. Admln Laws - Lhese refer Lo Lhe pollLlcal affalrs of Lhe counLry, on maLLers of
governmenL and pollLlcal subdlvlslons. 1hese cannoL be applled ln Lhe hlllpplnes.
6. When Lhe appllcaLlon of Lhe forelgn law would endanger Lhe forum's naLlonal lnLeresL or
securlLy.
1hese are Lhe lnsLances where, even Lhough Lhe proper law Lo apply be forelgn law, Lhe forum courL
would apply lnsLead Lhe lnLernal laws of Lhe forum counLry.
Colng back Lo publlc pollcy conslderaLlons, Lhe sLaLuLory basls of Lhe rule LhaL a forelgn law may noL be
applled ln Lhe hlllpplnes lf lL runs counLer Lo Lhe esLabllshed publlc pollcy and rules ln Lhe hlllpplnes ls
Lhe Lhlrd paragraph of ArLlcle 17 of Lhe Clvll Code:
rohlblLlve laws concernlng persons, Lhelr acLs or properLy, and Lhose whlch
have, for Lhelr ob[ecL, publlc order, publlc pollcy and good cusLoms shall noL be
rendered lneffecLlve by laws or [udgmenLs promulgaLed, or by deLermlnaLlons or
convenLlons agreed upon ln a forelgn counLry.
We have a solld sLaLuLory basls for Lhls prlnclple LhaL our laws may noL be rendered nugaLory slmply
because a parLlcular acL or acLlons are valld ln a forelgn counLry. 1haL's why when a dlvorce decree ls
obLalned by llllplnos abroad, even lf valld Lhere, lL may noL be recognlzed here because we do noL
recognlzed dlvorce, lnsofar as llllplnos are concerned.
1hls ls solld sLaLuLory basls on Lop of all Lhe [urlsprudence on Lhe maLLer.
!"#$%&'( "$ *+,- .&/(012 3456

#'

A very lnLeresLlng quesLlon ls how do you conslder Lhe sLaLus of same-sex marrlage ln Lhe hlllpplnes?
Pow do you conslder Lhe sLaLus of a person who underwenL sex LransplanL ln anoLher counLry. 1haL
would be a very lnLeresLlng quesLlon buL we wlll reserve Lhe dlscusslon when we Lake up personal law.

Second guldellne ls Lhe rlnclple of CharacLerlzaLlon. 1hls ls also anoLher prlnclple or guldellne whlch
may ald Lhe courL ln lLs Lask of properly maklng a cholce of law ln Lhe deLermlnaLlon of Lhe merlLs of a
confllcL of law quesLlon.
WhaL ls CharacLerlzaLlon?
Lvery confllcL of law quesLlon has Lwo parLs: llrsL ls Lhe facLual slLuaLlon whlch ralses Lhe problem and
Second ls Lhe connecLlng facLor or Lhe polnL of lmpacL whlch provldes Lhe soluLlon.
lacLual roblem
Legal SoluLlon

Pow does Lhe process of characLerlzaLlon play ouL ln Lhe courL's duLy Lo make a cholce of law ln Lhe
resoluLlon of every confllcL of law declslon?
Lvery facLual slLuaLlon, every problem, belongs Lo a parLlcular caLegory. ln oLher words, every facLual
problem has lLs own correspondlng legal soluLlon. lacLual problems (and correspondlng connecLlng
facLors) may be:
1. ConLracLs (exLernal valldlLy) - lex locl celebraLlons (ArLlcle 17)
2. Marrlage
3. 1orLs
4. SLaLus or CapaclLy - naLlonallLy 1heory (ArL 13 nCC)
3. Wllls and Successlon
6. roperLy - lex rae slLae (ArLlcle 16 par 1)
1hese slLuaLlons may be lnvolved ln a confllcL of law slLuaLlon. Pow does Lhe process of characLerlzaLlon
come ln?
CharacLerlzaLlon ls a process of asslgnlng a parLlcular facLual slLuaLlon or problem Lo lLs proper
correspondlng soluLlon.
So whaL are Lhese posslble soluLlons LhaL correspond Lo every facLual problem? ln every facLual
problem, Lhere ls a correspondlng legal soluLlon, Lhe so-called connecLlng facLor". lor example where
Lhe facLual problem lnvolves legal capaclLy, accordlng Lo Lhe rules ln Lhe hlllpplnes (ArL. 13 nCC), Lhe
!"#$%&'( "$ *+,- .&/(012 3456

#(

connecLlng facLor ls naLlonallLy 1heory. lf Lhe facLual problem ls lnLrlnslc valldlLy of a wlll, Lhe connecLlng
facLor here ls (ArL 16 nCC) Lhe naLlonal law of Lhe decedenL. Where Lhe facLual problem lnvolves Lhe
exLrlnslc valldlLy of Lhe conLracL,Lhe forms and solemnlLles of a conLracL, lLs connecLlng facLor ls LhaL
under ArL. 17 or lex locl celebraLlons. Where Lhe facLual problem ls Lhe legallLy of conveyance or Lransfer
of LlLle over properLy, Lhe correspondlng legal soluLlon here ls ArL. 16 1
sL
paragraph sLaLlng LhaL Lhe
connecLlng facLor ls lex rae slLae-Lhe law of Lhe place where Lhe properLy ls locaLed.
1herefore, CharacLerlzaLlon ls Lhe process of asslgnlng a facLual slLuaLlon or a facLual problem Lo lLs
correcL or proper legal caLegory. 1he legal caLegory lnvolves Lhose confllcL of laws perLalnlng Lo Lhelr
facLual slLuaLlon.
a. ArLlcle 13 - naLlonallLy 1heory
b. ArLlcle 16 1
sL
par. - lex rae slLae
c. ArLlcle 16 2
nd
par. - naLlonallLy 1heory
d. ArLlcle 17 - lex locl celebraLlones
e. And many more.
CharacLerlzaLlon, Lherefore, ls lmporLanL as lL wlll enable Lhe courL Lo properly resolve every confllcL of
law slLuaLlon. 1hls ls how Lhe SC made use of characLerlzaLlon ln Lhe case of
E,264 W3,?4,8 W43A48:5 95 QWG
1hls lnvolves a llllplna fllghL sLewardess named Mllagros Murada. She worked as a fllghL sLewardess for
a Saudl Arablan Alrllnes. Cne day, along wlLh Lhree oLher crew members of Lhe same alrcrafL, Look Lhelr
sweeL Llme ln a hoLel ln lndonesla. Cne Lhlng led Lo anoLher unLll one of Lhe co workers of Morada
aLLempLed Lo molesL her. 8uL because Lhe genLleman falled Lo consummaLe Lhe crlme, Morada flled a
case of rape :lol:.
Morada, who was lnlLlally Lhe aggrleved parLy unforLunaLely ended up Lo be an accused and was
convlcLed of a crlme for vlolaLlng Musllm laws (belng seen ln Lhe company of men, llsLenlng Lo muslc,
and golng Lo dlsco). 1hls resulLed Lo Lhe LermlnaLlon of her employmenL and her belng prosecuLed ln
Saudl for her vlolaLlon of Lhelr laws Lhere. So, wanLlng [usLlce, Morada flled a case for damages agalnsL
Lhe alrllnes for abuse of rlghLs under Lhe 81C of Lhe hlllpplnes.
Cne of Lhe defenses of Lhe alrllnes was on Lhe law appllcable whlch argued LhaL Lhe law appllcable ln Lhe
dlspuLe should be Lhe laws of Saudl because Lhe conLracL, employmenL and parLles, along wlLh Lhe
commlsslon of Lhe LorLlous acLs were commlLLed Lhere.
1he courL was confronLed wlLh Lhe problem of maklng Lhe cholce of law, wheLher Lhe Saudl or hlllpplne
laws. Pow dld Lhe courL make Lhe Lask easy Lo arrlve aL a [usL LermlnaLlon of Lhe lssue?
!"#$%&'( "$ *+,- .&/(012 3456

#)

1he SC resorLed Lo CharacLerlzaLlon. Pow? lL flrsL ldenLlfled Lhe facLual problem. 1he facLual problem as
can be ascerLalned from Lhe allegaLlons ln Lhe complalnL, obvlously presenL a LorL problem because Lhe
allegaLlons Lhere consLlLuLe abuse of rlghLs. 1he cause of acLlon asserLed by Morada was premlsed on
abuse of rlghLs ln ArLlcle 19 ln relaLlon Lo ArLlcles 20 and 21 of Lhe Clvll Code. So Lhe courL deLermlned
from Lhe allegaLlons ln Lhe complalnL LhaL Lhe problem ls one lnvolvlng LorL. We now have a facLual
problem.
Second quesLlon ls Lhe connecLlng facLor correspondlng Lo Lhe problem. Applylng now Lhe confllcL of
rules on LorL, Lhe connecLlng facLor ls lex locl commlssl - Lhe law of Lhe place where Lhe LorLlous acL ls
commlLLed. 8uL Lhls deLermlnaLlon presenLed more problems Lo Lhe courL because Lhe lex locl commlssl
would have been easy Lo apply lf Lhe LorLlous acL complalned of was commlLLed ln one sLaLe buL Lhe
case lnvolved a serles of LorLlous acL lnvolvlng a cross-counLry process - Lhere were acLs commlLLed ln
Lhe hlllpplnes and also some ln Saudl. 1he Lask ln deLermlnlng lex locl commlssl became dlfflculL on Lhe
parL of Lhe courL because Lhe acLs complalned of were commlLLed ln Lwo sLaLes.
Pow dld Lhe SC proceed?
1he SC applled Lhe prlnclple of Lhe SLaLe of MosL SlgnlflcanL 8elaLlonshlp 1heory". now one of Lhe
prlnclples ln lssues lnvolvlng LorL lf Lhe place of commlsslon of Lhe LorL cannoL be easlly deLermlned from
Lhe facLs ls Lo apply Lhe sald prlnclple. under Lhls rule, Lhe lex locl commlssl should perLaln Lo Lhe
counLry whlch bears Lhe mosL slgnlflcanL relaLlonshlp Lo Lhe LransacLlon, evenL and parLles. Pow dld Lhe
SC apply Lhe SLaLe of MosL SlgnlflcanL 8elaLlonshlp 1heory" ln Lhls case Lo deLermlne Lhe lex locl
commlssl?
1he SC sald LhaL whlle Saudl Arablan Alrllnes ls a forelgn corporaLlon, lL ls noL dlspuLed LhaL lL conducLs
buslness ln Lhe hlllpplnes. ln facL lL has lLs LlckeLlng sales ln Lhe hlllpplnes. Second, Lhe aggrleved
parLy, Morada, ls a llllplna. 1hlrd, Lhe decepLlve acLs of Lhe respondenL whlch mlsled Morada Lo go back
Lo Saudl Arabla, only Lo flnd herself accused of a crlme and convlcLed by Saudl Arablan courL Look place
ln Lhe hlllpplnes. 1he respondenL lnvlLed her Lo go back Lo Saudl on Lhe preLence LhaL her ald ls needed
Lo prosecuLe LhaL sonnafablch who Lrled Lo rape her buL ln LruLh and ln facL, she was prosecuLed for her
crlmes before Lhe Saudl Arablan law. lor Lhe courL, lL found Lhe acLs of Lhe respondenL decelLful,
warranLlng Lhe flllng of Lhe case here ln Lhe hlllpplnes.
AlLogeLher, Lhe SC ruled LhaL Lhe mosL slgnlflcanL aspecLs of Lhe case Look place ln Lhe hlls and
Lherefore under Lhe SLaLe of MosL SlgnlflcanL 8elaLlonshlp, Lhe lex locl commlssl ls Lhe hlllpplnes and,
Lherefore, whaL governs Lhe case ls Lhe law of Lhe hlllpplnes. 1haL's how Lhe process of characLerlzaLlon
plays ouL ln any confllcL of law slLuaLlon.
1he same prlnclple was also applled ln
^4??5 95 ^/9:38=:87 /0 D;4A4<<48: S5A,865G
!"#$%&'( "$ *+,- .&/(012 3456

#*

1hls lnvolves Lhe esLaLe of an Amerlcan clLlzen who dled ln Lhe hlllpplnes. When Lhe wlfe dled, Lhe
husband requesLed Lhe 8eglsLer of ueeds Lo Lransfer Lhe LlLles of Lhe properLles solely ln hls name
because he now clalmed LhaL Lhe properLles now solely belonged Lo hlm. 1he 8Cu, as a falLhful govL
offlcer, requlred Lhe husband Lo pay Lhe correspondlng esLaLe Lax. 1he 8Cu acLed ln Lhe premlse LhaL
when Lhe wlfe dled, a parL of Lhe properLy wenL Lo Lhe husband pursuanL Lo successlon, and under Lhe
hlllpplne laws, when ownershlp of a properLy from Lhe decedenL ls LransmlLLed Lo Lhe helr, esLaLe Lax ls
requlred Lo be pald before Lhe acLual Lransfer may be valldly done. Mr. Clbbs counLered LhaL Lhe
properLles were LransmlLLed Lo hlm as Lhe sole owner on Lhe basls of Lhe laws ln Lhe uS. lL Lurned ouL
LhaL ln Lhe uS, Lhe law ls LhaL Lhe lnLeresL of Lhe wlfe over Lhe properLy ls only lnchoaLe so LhaL lf a wlfe
dles ahead of Lhe husband, Lhe wlfe ls deemed noL Lo have owned Lhe properLy and so lf Lhe wlfe dles,
Lhe properLy ls deemed Lo be solely owned by Lhe husband. So ln Lhe uS, lf Lhe wlfe dles ahead of Lhe
husband, Lhere ls no lnherlLance Lo speak of, no Lransmlsslon of ownershlp, unllke ln Lhe hlllpplnes,
when a properLy belonglng Lo Lhe con[ugal parLnershlp, when one dles, parL of lL ls LransmlLLed Lo Lhe
survlvlng spouse by vlrLue of successlon. 1he uS laws do noL operaLe Lhe same way as Lhe hlllpplne
laws.
uurlng Lrlal, one of Lhe lssues was wheLher or noL Clbbs should be assessed wlLh Lhe correspondlng
esLaLe Lax as a consequence of Lhe deaLh of Lhe wlfe and Lhe Lransmlsslon of ownershlp ln hls favour.
Pow dld Lhe SC resolve Lhe lssue glven LhaL Lhe uS laws on Lhe maLLer confllcL wlLh Lhe hlllpplne laws?
1he SC ruled LhaL Lhls lnvolves properLy, properLles locaLed ln Lhe hlllpplnes. under Lhe confllcL of rules
on properLy ln SecLlon 16, real or personal properLy ls governed by Lhe laws ln whlch Lhey are slLuaLed
or lex rae slLae. Slnce Lhe properLles are locaLed ln Lhe hlllpplnes, Lhe lssue should be resolved by
applylng hlllpplne law. Cn Lhls premlse, Lhe SC wenL on Lo explaln LhaL under hlllpplne law, when Lhe
properLy ls acqulred durlng Lhe cohablLaLlon of Lhe husband and wlfe, boLh of Lhem owned lnLeresL ln
Lhe properLy. ln Lhe absence of conLrary agreemenL, Lhey are deemed co-owners of Lhe properLy so LhaL
when one dles, Lhe share of Lhe deceased, ln Lhe absence of oLher helrs, shall go Lo Lhe survlvlng spouse
by vlrLue of successlon. When Lhere ls successlon, Lhe governmenL celebraLes because lL ls abouL Lo
recelve esLaLe Lax!
Slnce ln Lhe hlllpplnes, when Lhe wlfe acLually owned an lnLeresL ln Lhe properLy durlng her llfeLlme,
whlch lnLeresL was Lransferred Lo Lhe husband upon deaLh, Lhe consequence Lhere ls Lhe paymenL of
esLaLe Lax. So Lhe SC dld noL apply Lhe rule obLalnlng ln Lhe uS where Lhe lnLeresL of Lhe wlfe over Lhe
properLy acqulred durlng Lhelr marrlage ls only lnchoaLe. 1hls came abouL because of Lhe process of
characLerlzaLlon. llrsL characLerlzlng Lhe problem as a problem of properLy, a facLual slLuaLlon lnvolvlng
properLy and Lhen correspondlngly apply lex rae slLae as Lhe connecLlng facLor.

(CuesLlon from Lhe class - lncomprehenslble)
!"#$%&'( "$ *+,- .&/(012 3456

$C

A: ln Lhe case of Saudl Arabla, Lhls prlnclple was applled ln a facLual slLuaLlon lnvolvlng LorL. 8uL you wlll
learn laLer LhaL Lhls ls also applled ln a facLual slLuaLlon lnvolvlng conLracL whlch wlll be dlscussed laLer.
ln oLher words, Lhls prlnclple of characLerlzaLlon ls noL only appllcable ln a facLual slLuaLlon lnvolvlng
LorL.
ln oLher words, Lhls prlnclple of Lhe SLaLe of MosL SlgnlflcanL 8elaLlonshlp ls noL only llmlLed Lo a facLual
slLuaLlon lnvolvlng LorL.
nexL guldellne or prlnclple whlch Lhe courL may conslder ln maklng Lhe proper cholce of law. 1he Lhlrd
ls, Lhls ls Lhe problem of Lhe 8envol. 8envol llLerally means Lhe referrlng back. 1hls conLemplaLes of a
slLuaLlon where Lhe lssue ralse before Lhe courL ls referred Lo a forelgn law for resoluLlon buL Lhe forelgn
law ln Lurn refers Lhe quesLlon back Lo Lhe law of Lhe forum. And lf Lhe forum courL wlll look aL agaln lLs
own rule, Lhe quesLlon ls referred agaln Lo Lhe law of Lhe forelgn counLry. So, lf noL resolved, Lhe
problem wlll be Loss back and forLh, Ad lnflnlLum. 1hls ls oLherwlse called as lnLernaLlonal fooLball.
So when does Lhe problem of Lhe renvol arlse? 1he problem of Lhe renvol arlses when Lhere ls doubL as
Lo wheLher Lhe reference by Lhe forum courL Lo a forelgn law, lnvolves elLher Lhe reference Lo Lhe
lnLernal law of Lhe forelgn counLry or Lhe reference Lo Lhe enLlre body of laws of LhaL forelgn counLry
lncludlng Lhe confllcL of laws rules of LhaL forelgn counLry.
AL Lhe beglnnlng of my dlscusslon, l polnLed lL ouL LhaL every sLaLe has lLs own body of laws and lL ls
classlfled lnLo Lwo: Lhe purely lnLernal and Lhe confllcL of laws rule. 1hese Lwo form Lhe enLlre body of
laws of every counLry. now lf Lhere ls doubL as Lo Lhe reference Lo Lhe forelgn counLry as Lo whaL law
wlll apply, wheLher Lhe reference ls Lhe enLlre body of laws of LhaL forelgn counLry lncludlng Lhe confllcL
of law rule or lLs lnLernal law.
So how does Lhe renvol problem arlse? Speclflc example would be, Lhe facLual slLuaLlon ls LhaL of
successlon. under our own confllcL of law rule on successlon lL says Lhere Lhe order of successlon, Lhe
amounL of successlonal rlghLs, Lhe valldlLy of Lhe LesLamenLary provlslons of Lhe wlll should be govern by
Lhe naLlonal law of Lhe decedenL.
Suppose Lhe decedenL ls a Cerman naLlonal, and Lhe lssue confronLlng Lhe courL ls abouL Lhe order of
successlon, who shall lnherlL flrsL among Lhe helrs of Lhe decedenL, of course lL shall be deLermlne on
Lhe basls of Lhe Cerman law. now, our own ArLlcle 16, 2
nd
paragraph, makes express reference Lo Lhe
naLlonal law of Lhe decedenL. lL says Lhere lL should be governed by Lhe naLlonal law of Lhe decedenL.
8u1 lL does noL speclfy whaL classlflcaLlon of law whlch applles ln Lhe law of LhaL forelgn counLry. lL does
noL speclfy wheLher Lhe reference ls Lhe lnLernal law or Lhe confllcL of laws rule ln Cermany. lL only says
LhaL lL shall be governed by Lhe naLlonal law of Lhe decedenL. So because of Lhls amblgulLy, Lhe problem
of renvol may someLlmes arlse. 8ecause lf Lhe courL wlll Lake Lhe poslLlon LhaL Lhe naLlonal law belng
referred Lo ln ArL. 16, 2
nd
paragraph as referrlng Lo Lhe enLlre body of laws lncludlng Lhe confllcL of law
!"#$%&'( "$ *+,- .&/(012 3456

$!

rules ln Cermany, renvol mlghL arlse because of Lhe posslblllLy LhaL Cermany's own confllcL of laws rule
on successlon may refer Lhe lssue back Lo Lhe laws of Lhe hlllpplnes. As when Lhe confllcL of laws rule ln
Cermany on successlon adheres Lo uomlclllary 1heory whlch says LhaL successlon should be governed by
Lhe laws of Lhe place where Lhe decedenL has hls domlclle aL Lhe Llme of hls deaLh. So Lhey are referrlng
back Lo Lhe lssue Lo Lhe hlllpplne laws buL lf Lhe forum courL wlll apply lLs own confllcL of laws rule
parLlcularly ArL. 16, paragraph 2, Lhe maLLer ls agaln referred Lo Cerman law. So Lhere wlll be no end of
referrlng Lhe lssue back and forLh.

So Lo end Lhls seemlng endless lnLernaLlonal fooLball, auLhorlLles come up wlLh cerLaln soluLlons Lo Lhe
problem. WhaL are Lhe suggesLed soluLlons?
number one, Lhe forum courL wlll accepL Lhe referrlng of Lhe lssue back Lo Lhe laws of Lhe forum, ln
whlch case Lhe forum courL wlll apply lLs own lnLernal law. 1haL's Lhe flrsL soluLlon.
Second soluLlon, ls for Lhe forum courL Lo re[ecL Lhe referrlng of Lhe lssue back Lo lLs laws. ln whlch case,
Lhe forum courL wlll apply Lhe lnLernal law of LhaL forelgn counLry.
1hlrd soluLlon, ls Lhe so -called muLual deslsLmenL or dlsclalmer, ln Lhls prlnclple Lhe forum courL wlll
deslsL ln applylng Lhe lnLernal law of LhaL forelgn counLry and lnsLead apply lLs own lnLernal law.
And Lhe fourLh one ls Lhe forelgn courL Lheory. 1he forum courL wlll do whaL Lhe forelgn courL wlll do lf
confronLed wlLh Lhe same problem.
WhaL ls Lhe soluLlon adopLed ln Lhe hlllpplnes? As lL ls now, Lhe soluLlon adopLed by Lhe hlllpplnes ls
LhaL applled ln Lhe case of
Q;3457:85:8 95G W[8,3G
now, whaL happened Lo Lhls case, a landmark case for Lhe maLLer. now, Lhls lnvolves Lhe esLaLe of
Ldward ChrlsLensen who ls an Amerlcan clLlzen of Lhe SLaLe of Callfornla, domlclled ln Lhe hlllpplnes,
acqulred properLles here, and aL Lhe Llme of hls deaLh, he lefL a wlll. ln hls wlll, he bequeaLhed Lhe bulk
of hls esLaLe Lo hls leglLlmaLe daughLer alLhough wlLhouL expressly recognlzlng hls paLernlLy Lo a llllplna
daughLer. Pe bequeaLhed a llLLle of hls esLaLe Lo Pelen Aznar. 1he leglLlmaLe daughLer's named ls Lucy.
ApparenLly, Pelen was an llleglLlmaLe daughLer. upon Lhe advlce of Pelen's brllllanL lawyer, Pelen
quesLloned Lhe lnLrlnslc aspecL of Lhe wlll, parLlcularly Lhe exLenL of Lhe apporLlonmenL of Lhe esLaLe of
Lhe faLher. Pelen felL LhaL she was glven a llLLle and Lucy goL more of Lhe esLaLe. now Pelen clalms LhaL
under Lhe lnLernal of Lhe hlllpplnes on successlon, an llleglLlmaLe chlld, llke herself ls enLlLled Lo x of
Lhe share of Lhe leglLlmaLe chlld. So apparenLly whaL was bequeaLhed Lo Pelen by Ldward ls less Lhan x
of whaL she ls enLlLled Lo recelve. 8y way of counLerargumenL, Lucy argued LhaL under Lhe laws of
!"#$%&'( "$ *+,- .&/(012 3456

$#

Callfornla Lhere ls no sysLem of leglLlme llke ln Lhe hlllpplnes where Lhere ls a porLlon of Lhe esLaLe
whlch ls noL Lo be dlsposed of by wlll because Lhey are reserved Lo compulsory helrs. 8uL ln Callfornla,
Lhe owner of Lhe esLaLe may dlspose hls properLy as he deem flL because Lhere ls no sysLem of leglLlme.
So ln Callfornla, a daughLer may noL recelve anyLhlng from Lhe faLher or Lhe parenLs because Lhe parenLs
may choose Lo bequeaLhed hls esLaLe Lo anoLher. So accordlng Lo Lucy, slnce LhaL's Lhe wlshes of hls
faLher, Lo glve Pelen Lhls much, Pelen has no cause Lo complaln.
So Lhe lssue confronLlng Lhe hlllpplne courL ln Lhls case, wheLher Pelen can clalm more Lhan whaL
Ldward bequeaLhed ln her favour on Lhe basls of Lhe wlll. ln oLher words, whaL law should govern? 1he
lssue of how much Pelen ls enLlLled Lo lnherlL or Lo geL under Lhe wlll? 1he courL was confronLed wlLh
Lhe quesLlon of applylng Lhe hlllpplne law ln whlch case Pelen enLlLled Lo more or apply Lhe Callfornla
or uS law ln whlch case Pelen ls noL enLlLled Lo more Lhan whaL ls sLaLed ln Lhe wlll. So Lhls ls obvlously a
confllcL of laws problem. 1he facLual problem ls successlon parLlcularly Lhe amounL of successlonal rlghLs
or Lhe lnLrlnslc valldlLy of LesLamenLary provlslons. And so applylng our CCL rule on successlon,
parLlcularly, ArL 16, 2
nd
paragraph, Lhe courL referred Lhe lssue Lo Lhe laws of Callfornla because LhaL ls
Lhe law of Lhe decedenL. ChrlsLensen was a clLlzen of Callfornla, uSA aL Lhe Llme of hls deaLh. now ln
Callfornla, Lhe uS, has lLs own body of rules on successlon, Lhe lnLernal and CCL rule on successlon. now
whaL was Callfornla lnLernal law on successlon? 1helr lnLernal law on successlon was LhaL a person may
dlspose of hls esLaLe by wlll ln any manner as he pleases. Whlch ls opposlLe Lo our own lnLernal law. And
whaL ls Callfornla CCL rule on successlon? lL says Lhere maLLers of successlon shall be governed by Lhe
laws of Lhe counLry where Lhe decedenL was a domlclle aL Lhe Llme of hls deaLh.
So unllke Lhe hlllpplnes CCL rule on successlon whlch adopLs Lhe naLlonallLy 1heory, Callfornla adopLs
Lhe uomlclllary 1heory. And so Lhe CCL rule of Callfornla refers back Lhe lssue Lo Lhe hlllpplne courLs or
Lhe hlllpplne law or Lhe laws of Lhe counLry where ChrlsLensen domlclled aL Lhe Llme of hls deaLh. 8uL
agaln Lhe courL wlll apply lLs own CCL rule under arL 16, Lhe lssue ls Lo be resolved by Lhe Callfornla law.
So whaL happened Lo Lhls case? So Lhe Supreme CourL sald, lf confronLed wlLh Lhls problem, our courL
SPCuLu ACCL1 1PL 8LlL88lnC 8ACk Cl 1PL lSSuL 1C l1S LAWS. So lL should accepL Lhe renvol and
once lL accepLs Lhe renvol, whaL Lhe forum courL should do ls LhaL lL wlll apply lLs own lnLernal law. ln
whlch case, our lnLernal law on successlon. ln oLher words, Pelen deserves more Lhan whaL he recelves
from Lhe faLher ln hls wlll.

CCnlLlC1S Cl LAWS Cn L8SCnAL LAW
When we say personal law, lL governs Lhe lndlvldual's sLaLus, condlLlon, legal capaclLy, famlly rlghLs and
duLles.
!"#$%&'( "$ *+,- .&/(012 3456

$$

Cur CCL on personal law ls LhaL Lhreshed ouL ln ArLlcle 13 of Lhe nCC whlch espouses naLlonallLy
1heory. lL says Lhere laws relaLlng Lo famlly rlghLs and duLles, sLaLus, condlLlon and legal capaclLy of
persons are blndlng upon llllplno clLlzens even lf llvlng abroad. So wherever a llllplno may go, he ls
always governed by Lhe hlllpplne law on maLLers perLalnlng Lo hls famlly rlghLs and duLles, sLaLus,
condlLlon and legal capaclLy.
So LhaL, even lf Lhe LransacLlon ls valld abroad, Lhe conLracL may noL be recognlzed here so long as lL
affecLs Lhe llllplno's sLaLus, famlly rlghLs, duLles, condlLlon and legal capaclLy. 1hls ls Lhe rullng ln Lhe
case of
SA=,3 D:3:[ 95G Q,74864>G
Mr. CaLlndlg named 1rlsLan was marrled Lo hls wlfe, Llly CaLlndlg. 8uL when Lhelr weddlng lasLed longer
Lhan Lhelr marrlage, and upon Lhe advlce of a muLual frlend, Lhey obLalned a dlvorce before a courL ln
uomlnlcan 8epubllc. uurlng Lhe pendency of Lhelr dlvorce proceedlng, Lhey flled a peLlLlon before Lhe
hlllpplne courL for Lhe dlssoluLlon of Lhelr con[ugal parLnershlp. 1hereafLer, Lhe dlvorce was granLed
and Lhe dlvorce decree was lssued by Lhe courL of uomlnlcan 8epubllc.
lL dld noL Lake long for Mr. CaLlndlg Lo meeL, Lo flnd, llmar and before long Lhey fell ln love and goL
marrled. AfLer cohablLlng for someLlme, llmar reallzed LhaL Lhe dlvorce decree obLalned by 1rlsLan and
Llly before a courL ln uomlnlcan 8epubllc dld noL blnd Lhem by reason of publlc pollcy. So ln order Lo
appease llmar, he promlsed LhaL he wlll make rlghL Lhe wrong by flllng a peLlLlon for nulllLy of marrlage
before h courL. 1hls Llme Lo legallze or Lo sLrengLhen hls sLaLus and capaclLy Lo marry llmar.
now durlng Lhe pendency of Lhe peLlLlon for nulllLy of marrlage before hlllpplne courL, for reason only
known Lo her, llmar flled a moLlon Lo lnLervene. Maybe she doesn'L wanL Lo Lake chances and she
lnLervened ln Lhe proceedlng and she prefaced her lnLervenLlon LhaL she ls Lhe wlfe and Lhe long Llme
companlon of 1rlsLan. AL Lhls Llme, Lhey were llvlng for 17 years already. now, Lhls was denled by Lhe
courL. 1he maLLer wenL up Lo Lhe SC and Lhe lssue was wheLher or noL Lhe lnLervenLlon should be
granLed.
1he SC sald lnLervenLlon maybe allowed only lf Lhe lnLervenlng parLy has lnLeresL ln Lhe sub[ecL maLLer
of Lhe peLlLlon and Lhls lnLeresL should noL be any klnd of lnLeresL buL an lnLeresL whlch ls acLual, dlrecL,
noL only lnchoaLe and lndlrecL. ln Lhls case, Lhe lnLeresL asserLed by llmar ls based on hls alleged sLaLus
as a wlfe of 1rlsLan. 8uL Lhe SC sald, she ls noL Lhe legal wlfe of 1rlsLan. Whlle lL may be Lrue LhaL 1rlsLan
and Llly obLalned a dlvorce decree before a courL ln uomlnlcan 8epubllc, belng llllplnos governed by
hlllpplne laws, Lhls dlvorce decree, dld noL blnd Lhem and ls noL recognlzed ln Lhe hlllpplnes. under
arL 13, llllplnos are governed by hlllpplne laws on maLLers concernlng famlly rlghLs, duLles, sLaLus,
condlLlon and legal capaclLy.
!"#$%&'( "$ *+,- .&/(012 3456

$%

So when 1rlsLan marrled llmar, obvlously, 1rlsLan had no legal capaclLy because hls marrlage wlLh Llly
was sLlll subslsLlng.
1hls case lllusLraLes LhaL personal laws of llllplnos govern llllplno clLlzens alLhough Lhey may enLer lnLo
LransacLlons abroad as long as lL concerns famlly rlghLs, duLles, sLaLus, condlLlon and legal capaclLy.
WhaL abouL personal laws of forelgners? 8ecause lf you look aL Lhe llLeral language of ArLlcle 13, lL ls
obvlously sLaLed Lhere LhaL, hlllpplne laws shall govern llllplno clLlzens. ArL 13 ls sllenL wheLher Lhe
prlnclple or Lhe 1heory of naLlonallLy applles equally Lo forelgners. lorelgners lnsofar as our CCL rule,
shall be governed by Lhe same naLlonallLy 1heory.
So LhaL when a forelgner comes here ln Lhe hlllpplnes and enLers lnLo a LransacLlon, and ouL of Lhls
LransacLlon, dlspuLe arlses and quesLlons lnvolvlng Lhe forelgners' sLaLus, famlly rlghLs, duLles, condlLlon
and legal capaclLy, shall be governed by Lhelr own laws. ln Lhe same manner LhaL llllplnos, are governed
by hlllpplne laws wherever Lhey may be.
1hls ls already seLLled by [urlsprudence. 1haL alLhough ArLlcle 13 ls llLerally worded Lo apply Lo llllplnos,
lL equally apply Lo forelgners. 1hls was Lhe rullng ln Lhe case of 8ecLo vs. Parden.
1he laLe ALLy. Claro M. 8ecLo durlng hls prlme, happens Lo represenL a cllenL by Lhe name of Mrs.
Parden ln connecLlon of a sulL Lo proLecL Lhe lnLeresLs of Mrs. Parden. uurlng LhaL Llme, she was
Lhlnklng of flllng a dlvorce agalnsL her husband ln Lhe uS. ln Lhelr engagemenL, Mrs. Parden underLook
Lo pay a subsLanLlal amounL of money by way of ALLy. 8ecLo's aLLy fees.
lasL forward, Lhe Llme for reckonlng came and Mrs. Parden refused Lo pay Lhe ALLy's fees. 1hls
prompLed ALLy. 8ecLo Lo go Lo courL Lo collecL.
8y way lf you can help lL, avold flllng a case agalnsL your cllenL for purpose of collecLlng fees. 1hls does
noL slL well wlLh our culLure as llllplnos. We are proud specles. !usL hlre someone, 13,000 Lo save you
from embarrassmenL. Lmbarrasslng for lawyers Lo flle cases agalnsL Lhelr cllenLs Lo collecL.
now anyway, by way of defense Mrs. Parden argued LhaL reLalnershlp agreemenL beLween 8ecLo and
Parden sLlpulaLlng Lhe aLLys fees cannoL be enforced ln CourL because lL ls vold and because lL ls enLered
lnLo ln conLemplaLlon of dlvorce. And slnce dlvorce ls agalnsL publlc pollcy, Lhe conLracL parLlcularly Lhe
maLLer on aLLys fees ls vold.
Pow dld Lhe SC resolve Lhe lssue? 1he SC resolve Lhls ln Lwo counLs.
llrsL, conLrary Lo Lhe clalm of Mrs. Parden Lhe reLalnershlp agreemenL enLered by ALLy 8ecLo and Mrs
Parden was noL enLered lnLo ln conLemplaLlon of dlvorce buL for purposes of proLecLlng Lhe lnLeresL of
Mrs. Parden for Lhe properLles belonglng Lo Lhe con[ugal parLnershlp.
!"#$%&'( "$ *+,- .&/(012 3456

$&

Second, by way of alLernaLlve [usLlflcaLlon, even lL can be assumed LhaL Lhe reLalnershlp agreemenL was
enLered ln conLemplaLlon of dlvorce, LhaL reLalnshlp agreemenL lnsofar as Mrs. Parden ls concern ls
valld. Why? Mrs. Parden ls an Amerlcan clLlzen and belng such, she ls governed by her own naLlonal
Law. And under Lhe laws of uS, dlvorce ls recognlzed. So LhaL sLlpulaLlon embodled ln Lhe reLalnershlp
agreemenL whereln Mrs. Parden underLook Lo pay cerLaln amounL of aLLys fees Lo aLLy recLo ls valld and
blndlng.
So ln Lhls case, Lhe SC made an express reference Lo ArL. 13 LhaL lnsofar as personal law of a forelgner,
Lhe governlng law ls Lhe forelgner's naLlonal law under arL. 13.

1hls was followed by Lhe case of
R,8 Y/38 95G M/=4AA/G
1hls lnvolves a llllplna wlfe and a forelgner. AfLer llvlng LogeLher as husband and wlfe for a whlle, a
peLlLlon for dlvorce was flled ouLslde and was granLed ln Lhe courL of uS. nevada. AfLer Lhe lssuance of
Lhe dlvorce decree, Lhe llllplna wlfe acqulred some buslness ln Lhe hlls and seelng Lhe promlse of Lhe
buslness, Lhe husband followed here ln Lhe hlllpplnes. 1he husband flled a peLlLlon ln courL seeklng Lhe
[olnL admlnlsLraLlon ln Lhe buslness, clalmlng LhaL belng Lhe husband, he ls enLlLled under hlllpplne law
Lo exerclse Lhe [olnL auLhorlLy over Lhelr con[ugal buslness. lL was argued by Lhe wlfe LhaL he has no
personallLy Lo ask for [olnL managemenL because a dlvorce decree was already obLalned and he cannoL
anymore clalm Lo be Lhe husband of Lhe wlfe, and clalm Lhe rlghL of [olnL managemenL. 8uL Lhe
Amerlcan husband counLerargued LhaL Lhe dlvorce decree lnsofar as hll law ls concern lL noL
recognlzed, noL valld. So LhaL ln Lhe eyes of hll law, Lhe husband conLlnues Lo be Lhe husband of llllplna
wlfe enLlLled Lo exerclse [olnL managemenL.
So Lhe lssue as Lo WCn Lhe husband has personallLy or has Lhe rlghL Lo ask for [olnL managemenL of Lhe
buslness, he clalms Lo be belonglng Lo Lhe wlfe and Lo hlm.
1he Sc sald whlle dlvorce ls noL recognlzed here ln Lhe hlls.,only Lhe llllplnos are covered by Lhls
prohlblLlon. 8uL lnsofar as Lhe forelgner, Lhe Amerlcan husband ln Lhls case, slnce he ls governed by hls
naLlonal law and Lhe uS laws recognlzed dlvorce, Lhen LhaL dlvorce decree ls valld and blndlng lnsofar as
Lhe Amerlcan husband ls concerned and he cannoL flle a case ln courL sLlll clalmlng Lo be husband of Lhe
llllplna.
1hls was followed by Lhe case of llapll vs. lbay-Somera.
1hls case lnvolves a llllplna and a Cerman. AfLer someLlme, Lhe Cerman flled a peLlLlon for dlvorce
before Cerman courL whlch was accordlngly granLed. AfLer Lhe lssuance of Lhe dlvorce decree, Lhe
!"#$%&'( "$ *+,- .&/(012 3456

$'

husband reLurned Lo Lhe hlls afLer he learned LhaL hls wlfe even before Lhelr dlvorce and durlng Lhelr
cohablLaLlon was already playlng wlLh flre, playlng ln anoLher Leam, Lhe Cerman husband lnsLlLuLed a
case of adulLery agalnsL Lhe llllplna wlfe.
1he quesLlons was WCn Lhe Cerman has legal personallLy Lo lnsLlLuLe or lnlLlaLe Lhe crlmlnal case of
adulLery as an offended spouse.
1aklng cue from Lhe declslon of van uorn vs 8omlllo, Lhe SC sald LhaL whlle dlvorce ls noL recognlzed ln
Lhls counLry and noL blndlng upon lll clLlzens, dlvorce obLalned by forelgners abroad ls blndlng upon
forelgners so long as lL ls valld ln accordance wlLh Lhelr naLlonal law. And slnce under Cerman law, whlch
ls Lhe clLlzenshlp of Lhe husband, Lhe dlvorce decree whlch was valldly obLalned ln Cermany, Lhe
Cerman husband ls bound by Lhe dlvorce decree LhaL he hlmself obLalned and because he ls noL Lhe
husband he cannoL lnsLlLuLe a crlmlnal case of adulLery because belng a prlvaLe crlme lL can only be
lnsLlLuLed by an offended spouse. Slnce he cannoL clalm Lo be an offended spouse pursuanL or as a
resulL of Lhe dlvorce decree, he cannoL lnsLlLuLe Lhe crlmlnal acLlon for adulLery.
ln Lhls case Lhe Supreme courL made a deflnlLlve rullng LhaL Lhe recognlLlon of Lhe effecLs of Lhe dlvorce
decree obLalned abroad ls only llmlLed Lo Lhe allen husband. So LhaL lnsofar as Lhe lll spouse ls
concerned, Lhe dlvorce decree ls noL blndlng upon her. So whlle Lhe husband was no longer Lhe husband
of Lhe llllplna wlfe, Lhe fll wlfe remalns Lo be Lhe wlfe Lo a person who ls no longer her husband. 1haL's
why lL was correcLed laLer on.
AnoLher case lllusLraLes Lhe auLhorlLy on Lhe dlvorce decree obLalned abroad and lLs effecL as recognlzed
ln Lhe hlllpplnes.
LaurenLe vs LaurenLe, Lhls lnvolves Lorenzo LaurenLe who has marrled Lo aola. uurlng Lhe exlsLence of
Lhe marrlage Lorenzo wenL Lo Lhe unlLed SLaLes leavlng aola behlnd ln Lhe hlllpplnes. Whlle ln Lhe uS,
Lorenzo obLalned an Amerlcan ClLlzenshlp. ln one of hls vlslLs Lo Lhe hll, afLer a long sLay ln Lhe uS,
Lorenzo dlscovered LhaL hls beloved wlfe aola was already pregnanL and cohablLlng wlLh hls faLher.
Lorenzo lefL aola and dld noL forglve aola and hls faLher. 8eLurned Lo Lhe uS, acqulred Amerlcan
clLlzenshlp, and obLalned a dlvorce decree ln Lhe uS. 1hls Llme he meL a llllplna woman named Allcla,
fell ln love and goL marrled. fasL forward, durlng Lhe exlsLence of Lhe second marrlage, Lorenzo dled.
Pls esLaLe now ls belng conLesLed by aola and second wlfe, Allcla. aola clalmed LhaL Lhe dlvorce
decree ls lnvalld because lL ls noL recognlzed ln Lhe hlllpplnes. 8uL Lhe SC overruled Lhe argumenL of
aola holdlng LhaL aL Lhe Llme Lorenzo obLalned Lhe dlvorce decree he was already an Amerlcan clLlzen,
hence lL ls governed by Lhe naLlonal law on maLLers concernlng sLaLus, capaclLy,.. Supreme CourL
recognlzed Lhe dlvorce decree obLalned by Lorenzo. ln shorL, Lhe SC recognlzed Allcla as Lhe lawful wlfe
of Lorenzo.
!"#$%&'( "$ *+,- .&/(012 3456

$(

1he Supreme CourL ls conslsLenL ln holdlng LhaL lf Lhe dlvorce decree ls obLalned by a forelgner or allen
husband abroad, Lhe dlvorce decree ln so far as Lhe allen spouse ls concerned ls valld and lLs effecL ls
recognlzed ln Lhe hlllpplnes. 1he basls here belng LhaL as an allen clLlzen, Lhe allen spouse ls governed
by hls naLlonal law and under Lhe naLlonallLy Lheory maLLers concernlng sLaLus, condlLlons, and legal
capaclLy are governed by hls naLlonal law, and dlvorce belng recognlzed under hls naLlonal law musL be
blndlng ln so far as Lhe allen spouse ls concerned.
WhaL happens lf Lhe dlvorce decree was obLalned by Lhe llllplna spouse? Wlll lL have Lhe same effecL?
Wlll lL blnd Lhe allen spouse and wlll Lhe effecLs be recognlzed ln Lhe hlllpplnes?
1akasln vs 1akasln, Lhe SC answered Lhls quesLlon ln Lhe afflrmaLlve. 1he husband ls an Amerlcan clLlzen
marrled Lo a llllplna spouse. AfLer Lhelr marlLal unlon, Lhe llllplno wlfe flled and obLalned a dlvorce
decree agalnsL Lhe husband ln Lhe uS. under Lhe sald dlvorce decree, Lhe llllplno wlfe was granLed Lhe
sole cusLody of Lhelr chlldren. Pence Lhey subsequenLly agreed Lo enLer lnLo a dlvorce agreemenL
whereby Lhe allen husband and Lhe llllplno wlfe agreed Lo have a [olnL auLhorlLy and cusLody over Lhelr
only chlld. Alleglng a breach of Lhe agreemenL by Lhe llllplno wlfe, Lhe Amerlcan husband flled a case ln
courL for Lhe enforcemenL of Lhe agreemenL. 1hls was opposed by Lhe wlfe, one of Lhe legal lssues
confronLlng Lhe case was wheLher or noL Lhe agreemenL lLself were Lhe parLles agreed LhaL Lhe cusLody
of Lhe chlld shall be shared beLween Lhem ls valld glven LhaL ArL 213 of Lhe lamlly Code LhaL lf Lhe chlld
ls below 7 yo, Lhe cusLody of Lhe chlld shall be awarded Lo Lhe moLher ln case of Lhe separaLlon of Lhe
spouses. 8ecause of Lhls lssue, Lhe SC found lL necessary Lo resolve wheLher or noL Lhe spouses were
valldly annulled, or wheLher or noL Lhelr marrlage was valldly dlssolved. So LhaL lf Lhere was a valld
dlssoluLlon of marrlage, Lhen cusLody of Lhe chlld shall be awarded Lo Lhe llllplna spouse, oLherwlse, Lhe
agreemenL for [olnL cusLody would be conLrary Lo our laws, ArL 213 of Lhe lC. lf on Lhe oLher hand lf Lhe
marrlage was noL valldly dlssolved, Lhen Lhe agreemenL appears Lo be conslsLenL wlLh ArL 213 of Lhe lC.
Pow dld Lhe Supreme CourL resolve Lhe lssues ln Lhe case? 1he Supreme CourL sald lL ls undlspuLed LhaL
Lhe dlvorce decree was obLalned abroad by Lhe llllplna spouse. So Lhere was a dlvorce decree obLalned
by a llllplna wlfe. 1he quesLlon Lhere ls how does lL affecL Lhe allen husband? SC sald lf a dlvorce decree
ls obLalned abroad, LhaL dlv decree shall be blndlng beLween spouses regardless of who beLween Lhe
spouses obLalned Lhe decree of dlvorce. So even lf lL was obLalned by a llllplno spouse who ls under Lhe
law noL bound by Lhe dlvorce because Lhere ls no law LhaL allows a llllplno Lo have a dlvorce. 1he reason
ls because lL ls conLrary Lo publlc pollcy. 8uL Lhe slLuaLlon whereln lL ls Lhe llllplno spouse who obLalned
Lhe dlvorce, Lhe dlvorce ls noneLheless valld ln so far as Lhe allen spouse ls concerned. Pence, Lhe CourL
sald LhaL Lhe agreemenL for [olnL cusLody cannoL be enforced ln Lhe hlllpplnes for belng conLrary Lo our
own law, Lhe law belng ArL 213 of Lhe lC.

!"#$%&'( "$ *+,- .&/(012 3456

$)

LeL me refer you Lo ArL 26 of Lhe lamlly Code ln relaLlon Lo dlvorce, Lhls ls noL yeL covered buL l have Lo
dlscuss Lhls ln relaLlon Lo ArL 13. now, lf you look aL ArL 26 second par., ln a marrlage beLween a
forelgner and a llllplno, and subsequenLly such forelgner obLalns a dlvorce decree and capaclLaLes hlm
Lo remarry, LhaL dlvorce decree also capaclLaLes Lhe llllplno spouse Lo remarry. 8uL Lake noLe LhaL for
arL 26, par 2 of Lhe lC Lo apply , Lhe parLy who obLalned Lhe dlvorce decree ls Lhe allen spouse,
oLherwlse, arL 26 par 2 wlll noL apply. So a dlvorce decree under ArL 26, par 2, a dlvorce decree whlch
wlll capaclLaLe a llllplno spouse ls a dlvorce decree obLalned by Lhe allen spouse, noL Lhe oLher way
around. Cbvlously, arL 26 par 2 was lncorporaLed ln Lhe lC Lo address Lhe anomaly ln Lhe earller case of
vandorn vs umllla where Lhe dlvorce decree ls recognlzed as valld ln so far as Lhe allen spouse ls
concerned buL noL ln so far as Lhe llllplno spouse ls concerned puLLlng ln an absurd slLuaLlon where a
llllplno spouse remalns Lo be marrled Lo a spouse who ls no longer hls wlfe or husband. 1haL ls why
when a dlvorce decree ls obLalned by an allen spouse, Lhe dlvorce decree should recognlzed as valld
noL only ln so far as Lhe allen spouse ls concerned, buL also Lhe llllplno spouse. 1hls ls modlflcaLlon of
Lhe earller rullng ln Lhe Case of llapll vs Somera, where Lhe SC made a deflnlLlve rullng LhaL Lhe valldlLy
of Lhe dlvorce, Lhe recognlLlon of Lhe effecLs of Lhe dlvorce shall only be llmlLed or appllcable ln so far as
Lhe allen spouse ln concerned by reason of publlc pollcy. 8uL ArL 26 expanded Lhe effecLs of Lhe
recognlLlon of Lhe valldlLy of dlvorce obLalned abroad by Lhe allen spouse such LhaL lL wlll also be blndlng
and valld ln so far as Lhe llllplno spouse ls concerned who ls now also capaclLaLed Lo also remarry.

So ok? lf Lhe ulvorce uecree was obLalned by a llllplno spouse, ArL 26 par 2 does noL apply and
Lherefore, whlle Lhe dlvorce decree may be valld and blndlng lnsofar as Lhe allen spouse ls concerned, lL
ls noL valld and blndlng lnsofar as Lhe llllplno spouse, and Lherefore Lhe llllplno spouse may noL
remarry. now, Lake noLe LhaL whaL ls prohlblLed under ArL 26 par 2 ls a dlvorce decree obLalned abroad,
as l sald Lhese ls only llmlLed Lo slLuaLlon where Lhe dlvorce decree ls obLalned by Lhe allen spouse
abroad, noL by a llllplno spouse. ?ou have Lo dlsLlngulsh Lhls from a slLuaLlon where whaL was obLalned
abroad ls noL a dlvorce buL a nulllLy or declaraLlon of nulllLy ofa marrlage beLween a forelgner and
llllplno obLalned abroad by a llllplno spouse. 1hls ls noL covered by ArL 26 par 2 because under ArL 36
par 2 conLemplaLes of dlvorce. lf lL ls dlvorce obLalned by a llllplno spouse abroad, lL does noL capaclLaLe
Lhe llllplno spouse Lo remarry. 8uL lf whaL was flled and obLalned abroad by Lhe llllplno spouse ls noL
dlvorce buL declaraLlon of nulllLy of marrlage based on blgamy for example, LhaL declslon lssued by Lhe
forelgn courL nulllfylng Lhe marrlage on Lhe ground of blgamy may be recognlzed and even enforced ln
Lhe hlllpplnes whlch wlll resulL Lo Lhe capaclLy of Lhe llllplno spouse Lo remarry. 1hls ls Lhe rullng ln Lhe
case of u[lkl vs Mahlnay, Lhls ls a very lnLeresLlng case. u[lkl ls a !apanese naLlonal who fell ln love and
marrled Mahlnay, a llllplna. 8uL because Lhelr marrlage does noL seek well wlLh Lhe parenLs of Lhe
!apanese husband, Lhey evenLually separaLed. now alone and lonely, Mahlnay meL and fell ln love wlLh
anoLher !apanese by Lhe name of Maykara, and Lhey goL marrled ln !apan, buL Mahlnay succumb Lo Lhe
oppresslve ways of Maykara who sub[ecLed her Lo physlcal and emoLlonal abuse.
!"#$%&'( "$ *+,- .&/(012 3456

$*

Whlle Mahlnay was sufferlng from Lhe hands of Maykara, by sheer of forLune or luch, Mahlnay meL u[lkl
agaln ln !apan. 1hls Llme, Lhey fell ln love wlLh each oLher agaln and goL Lo rellve agaln Lhelr once losL
relaLlonshlp. So ln hls efforL Lo resume Lhe relaLlonshlp, u[lkl asslsLed Mahlnay Lo flle a peLlLlon for
declaraLlon of nulllLy of a marrlage wlLh Maykara on Lhe ground of blgamy. 8ecause aL Lhe Llme Mahlnay
and Maykara goL marrled Lo each oLher, Lhe marrlage beLween u[lkl and Maykara was sLlll subslsLlng.
1hls peLlLlon was granLed by Lhe !apanese CourL and subsequenLly u[lkl, Lhe flrsL husband, wenL Lo Lhe
hlllpplnes and flled an acLlon Lo enforce Lhe [udgmenL rendered by Lhe !apanese CourL declarlng Lhe
marrlage beLween Mahlnay and Maykara null and vold by reason of blgamy. Cne of Lhe subsLanLlal
lssues ralsed ln Lhls case was wheLher or noL Lhe [udgmenL of !apanase courL declarlng Lhe marrlage
beLween Mahlnay and Maykara vold by reason of 8lgamy may be enforced ln Lhe hlllpplnes. 1hls ls a
slLuaLlon where Lhe marrlage was solemnlzed beLween a forelgner and a llllplna buL lL was Lhe llllplna
who flled a peLlLlon for nulllLy of marrlage abroad. 1ake noLe, has lL been a peLlLlon for dlvorce lnlLlaLed
by Lhe llllplno spouse, lL should have noL been recognlzed here ln Lhe hlllpplnes by reason of publlc
pollcy. 8uL Lhls ls noL a dlvorce, buL lnsLead a eLlLlon for ueclaraLlon of nulllLy of Marrlage. So how dld
Lhe SC resolve Lhls lssue? 1he SC resolved ln Lhls manner, whlle lL may be Lrue LhaL Lhe eLlLlon for
ueclaraLlon of nulllLy of Marrlage was flled by a llllplna wlfe abroad, Lhe evll soughL Lo be avolded under
ArL 26 par 2 ls presenL ln Lhls case. Meanlng, Lhe slLuaLlon where a llllplno spouse conLlnue Lo remaln Lo
be a spouse Lo an allen husband who ls no longer her husband, would conLlnue Lo exlsL lf Lhe peLlLlon for
Lhe declaraLlon of nulllLy of marrlage would noL be recognlzed ln Lhe hll. So as a sorL of analogy, Lhe SC
sald LhaL Lhe uecree of ueclaraLlon of nulllLy of Marrlage lssued by Lhe !apanese CourL should llkewlse
blnd and be recognlzed ln Lhe hll so as Lo free Mahlnay from legal obllgaLlons arlslng from a vold
marrlage.

1ake noLe, LhaL unllke ln dlvorce, a peLlLlon for nulllLy of marrlage based on blgamy ls conslsLenL wlLh
our laws because under our arL 33 par 4 of Lhe lC, we also conslder a marrlage vold lf lL ls blgamous. SC
1PlS dlfferenLlaLes a slLuaLlon where a dlvorce decree ls obLalned by a llllplno spouse abroad because lf
a dlvorce decree ls obLalned by a llllplno spouse abroad, Lhls cannoL be recognlzed ln Lhe hll ln so far as
Lhe llllplno spouse ls concerned by reason of publlc pollcy, alLhough lL may be recognlzed ln so far as Lhe
allen spouse ls concerned as held ln Lhe case of 1akasln vs 1akasln. WhaL ls conLemplaLed under arL 26
par 2 of Lhe lC ls a dlvorce decree obLalned by an allen spouse. 8uL Lhls rule does noL apply when whaL
ls obLalned abroad ls noL a dlvorce, buL a declaraLlon of nulllLy of marrlage because Lhls ls noL agalnsL
our publlc pollcy. As a maLLer of facL, Lhls ls conslsLenL wlLh our law on Lhe maLLer parLlcularly arL 33 par
4.

Ckay now, under arL 13, Lhe sLaLus governlng Lhe law of an lndlvldual, whlch under arL 13 ls governed by
Lhe naLlonal law, lncludes maLLers regardlng Lhe person's personal clrcumsLances llke wheLher he's
!"#$%&'( "$ *+,- .&/(012 3456

%C

slngle, marrled, or dlvorced. 1he paLernlLy afflllaLlon wheLher he ls leglLlmaLe, llleglLlmaLe, leglLlmaLed or
adopLed, Lhe age and Lhe legal capaclLy, Lhe name, Lhe professlon, hls sex and oLher personal
clrcumsLances. 1hese are maLLers governed by Lhe naLlonal law of Lhe lndlvldual concerned and Lhe
naLlonallLy Lheory. now Lhen, lf Lhe parLles are forelgners, clLlzens of a forelgn counLry where same sex
marrlage ls valld, lf Lhey are boLh clLlzens of Callfornla, so whaL happens lf Lhe couples, example Mr.
Sanchez and Mr. 8ayalas, a dlspuLe arlses ln Lhe hlllpplne CourL when Lhelr sLaLus as husband and wlfe
or husband and husband, or wlfe or wlfe, ls puL Lo quesLlon. So our courLs recognlze Lhe valldlLy of
marrlage and recognlze Lhem as lawful spouses? lf you look aL ArL 13 and a number of [urlsprudence on
Lhe maLLer, lL would appear LhaL lf Lhe marrlage ls valld under Lhelr own laws or Lhe law where Lhey are
clLlzens, Lhe marrlage musL be recognlzed ln Lhe hlllpplnes.
+:F 3,: 547,: :F<A,48:6
So lf a conLracL lnvolves real or personal properLy locaLed ln Lhe hlllpplnes, and Lhe parLles are forelgn
naLlonals, even lf Lhey are legally capaclLaLed ln Lhelr own counLrles buL noL under hlllpplne laws
because boLh of Lhem are below 18, Lhen lnsofar as our courLs are concerned, Lhey cannoL be
consldered as parLles wlLh legal capaclLy. So Lhe conLracL ln LhaL respecL, ls defecLlve for lack of legal
capaclLy, because of Lhe prlnclple of !"# )*" ,'-*". Slmllarly, before Lhe solemnlLles of Lhe conLracL whlch
(lnaudlble) governed by Lhe place of celebraLlon and Lhe (lnaudlble 38:03). ArLlcle 17 says, forms and
solemnlLles of Lhe conLracLs, wllls and oLher publlc lnsLrumenLs shall be governed by Lhe laws of Lhe
place where Lhey are execuLed. 8uL lf Lhe conLracL lnvolves properLles, Lhe forms and solemnlLles of Lhe
conLracL are noL Lo be governed by Lhe laws of Lhe place of execuLlon, buL Lhe law ln Lhe place where Lhe
properLy lnvolved ls locaLed. 1hls ls Lhe rullng ln Lhe case of /"0.(!'& %1 -2" 32'!'00'+", 4,5
6*+7'8*+(*9*+.
S=</37,87 -,5:b !"#$%&'( *+ ,-" .-'&'##'/"0 102 34/5'64/%474/
1hls lnvolves a consolldaLed peLlLlon for an annulmenL of a compromlse agreemenL enLered lnLo by Lhe
CCC agalnsL one of Lhe alleged cronles of Lhe laLe dlcLaLor lerdlnand Marcos, Mr. norberLo 8enedlcLo.
1hese peLlLlons arose from acLlons for Lhe recovery of alleged lll-goLLen wealLh. 1hese cases were flled ln
Lhe uS, Lurope, Lhe purpose of whlch was Lo recover Lhe alleged lll-goLLen wealLh of Marcos and hls
cronles. Some of Lhese cases were sub[ecL Lo a compromlse agreemenL by Mr. 8enedlcLo and Lhe
8epubllc of Lhe hlllpplnes. under Lhe agreemenL, some properLles alleged Lo be lll goLLen were ceded
(noL sure kal naay nlubo!) Lo Lhe governmenL ln conslderaLlon of Lhe llfLlng of Lhe sequesLraLlon orders
ordered by Lhe hlllpplne governmenL lnsofar as Lhe oLher properLles are concerned. ln addlLlon, ln
conslderaLlon for cedlng some of Lhese properLles Lo Lhe governmenL, Lhe governmenL agreed Lo exLend
lmmunlLy Lo 8enedlcLo and Lhe resL of hls famlly. SubsequenLly, when Lhe Lerms of Lhe compromlse
agreemenL were parLlally execuLed, Lhe governmenL flled a peLlLlon for Lhe revocaLlon of Lhe
compromlse agreemenL. Cne of Lhe lssues ralsed by Lhe CCC was Lhe valldlLy of Lhe compromlse
agreemenL, because lL was apparenLly execuLed abroad ln relaLlon Lo Lhe cases flled ouLslde of Lhe
!"#$%&'( "$ *+,- .&/(012 3456

%!

hlllpplnes. 1hls compromlse agreemenL was soughL Lo be revoked ln a hlllpplne courL. lL was
apparenLly noL auLhenLlcaLed ln accordance wlLh our rules, and lL was execuLed wlLhouL Lhe
parLlclpaLlon of wlLnesses. lL was clalmed by Lhe CCC LhaL Lhls compromlse agreemenL was noL valld
exLrlnslcally because lL falled Lo comply wlLh Lhe formal requlremenLs under hlllpplne law, Lhe formal
requlremenL belng LhaL lf lL was execuLed abroad, lL should be auLhenLlcaLed. 1he SC re[ecLed Lhe
argumenL of Lhe CCC or Lhe 8epubllc because lL sald LhaL whlle generally forms and solemnlLles of
conLracLs are governed by !"# !%&' &"!"()*-'%+', or Lhe laws of Lhe place where Lhey are execuLed, under
!"# )"' ,'-*", Lhe forms and solemnlLles of conLracLs, lnvolvlng Lhe acqulslLlon, allenaLlon, dlsposlLlon of
properLy, real or personal, should be governed by Lhe law of Lhe place where Lhe properLy ls locaLed.
Conslderlng LhaL Lhese properLles sub[ecL of Lhe compromlse agreemenL are locaLed ln Lhe hlllpplnes,
Lhe SC sald LhaL Lhe valldlLy of Lhe forms and solemnlLles of Lhe compromlse agreemenL should be
deLermlned on Lhe basls of hlllpplne law. under hlllpplne law, a conLracL lnvolvlng properLy, Lhe
conveyance of properLy, whlle lL ls requlred Lo be ln a publlc lnsLrumenL, Lhls requlremenL ls only for Lhe
purpose of convenlence, buL noL for Lhe purposes of Lhelr valldlLy. Lven lf Lhe compromlse agreemenL
dld noL comply wlLh Lhe requlremenL of auLhenLlcaLlon and Lherefore cannoL be consldered as a publlc
lnsLrumenL, Lhe SC sald lL's sLlll valld because all Lhe elemenLs of a valld conLracL are presenL. 1he
requlremenL LhaL lL be ln a publlc conLracL was merely for convenlence, buL never for valldlLy. 1hls case
lllusLraLes Lhe rule LhaL lnsofar as LransacLlons lnvolvlng acqulslLlons, dlsposlLlon, or conveyance of
properLy, !"# )"' ,'-*" applles and noL !"# !%&' &"!"()*-'%+',.
L7;:3 =,77:35 B;:3: &"8 94" 0',4" ,<<A4:5
WhaL are Lhe oLher maLLers governed by !"# )*" ,'-*"? So agaln, whaL are Lhe lnsLances when !"# )"'
,'-*" *00!'",? LeL's revlew for brevlLy: (1) when lL comes Lo Lhe exLrlnslc and lnLrlnslc valldlLy of a
LransacLlon lnvolvlng properLy, !"# )"' ,'-*" applles, (2) when Lhe capaclLy of Lhe conLracLlng parLles ls an
lssue, !"# )"' ,'-*" applles, (3) lf Lhe ruckus ls Lhe lnLerpreLaLlon of Lhe documenL evldenclng Lhe
LransacLlon, !"# )"' ,'-*" applles, (4) maLLers concernlng effecLs of ownershlp, !"# )"' ,'-*", (3) maLLers
concernlng co-ownershlp, !"# )*" ,'-*", (6) maLLers concernlng accesslon, usufrucL, easemenL,
prescrlpLlon, reglsLraLlon, morLgage, emlnenL domaln, LaxaLlon, are agaln governed by !"# )*" ,'-*".
1ake noLe LhaL by way of excepLlon Lo ArLlcle 13, or Lhe naLlonallLy 1heory, concernlng Lhe capaclLy of
Lhe conLracLlng parLles ln conLracLs lnvolvlng properLles, ls noL governed by Lhe naLlonallLy rlnclple, buL
by !"# )*" ,'-*" under ArLlcle 16, flrsL paragraph.
IF-:<74/85 7/ 7;: ,<<A4-,74/8 /0 &"8 94" 0',4": ;4$9"& 102 <49('4= 4 1"97 '>#*9,4/, (40"
WhaL are Lhe excepLlons Lo Lhe prlnclple of !"# )*" ,'-*"? Such LhaL even lf Lhe dlspuLe of Lhe LransacLlon
may lnvolve properLy, !"# )*" ,'-*" does noL apply? l'd llke you Lo pay parLlcular aLLenLlon Lo Lhe case of
Laurel vs Carcla. A very lnLeresLlng case. 1hls case lnvolves Lhe so-called 8opongl properLy, a properLy
belonglng Lo Lhe governmenL of !apan buL ceded Lo Lhe hlllpplne governmenL as reparaLlon for Lhe
damage caused Lo llllplnos durlng Lhe 2
nd
world war. 1hls properLy used Lo be uLlllzed for consular or
!"#$%&'( "$ *+,- .&/(012 3456

%#

dlplomaLlc purposes by Lhe hlllpplne governmenL, buL when lL was abandoned, Lhe (Cory) Aqulno
admlnlsLraLlon LhoughL of dlsposlng Lhe properLy, ln order Lo augmenL Lhe governmenL's fundlng for
lmplemenLlng Lhe flagshlp pro[ecL of Lhe governmenL, Lhe new Agrarlan 8eform Law. 8uL Lhls lnLended
sale was meL by vehemenL opposlLlon by cerLaln groups, who argued LhaL Lhls dlsposlLlon would vlolaLe
Lhe ConsLlLuLlonal provlslon upholdlng hlllpplne paLrlmony. 1haL Lhls ls a senLlmenLal properLy lmbued
wlLh a senLlmenLal value. 1hese opposlLors furLher argued LhaL Lhe properLy was used for a publlc
purpose, slnce lL was used for consular purposes, Lo house Lhe dlplomaLs and Lhe consuls ln !apan. lf we
Lake a look aL Lhe provlslons of Lhe Clvll Code on roperLy, properLles of Lhe publlc domaln used for a
publlc purpose cannoL be sub[ecL Lo commerce of man or may noL be dlsposed.
Cn Lhe oLher hand, Lhe proponenLs of Lhe pro[ecL argued LhaL Lhls provlslon (lnvolvlng properLy) ln Lhe
Clvll Code does noL apply ln Lhls case because by reason of !"# )*" ,'-*", Lhe LransacLlon should be
governed by Lhe laws of Lhe roperLy where lL's slLuaLed, !apan ln Lhls case. So lL should be !apanese
laws whlch would apply, noL Lhe hlllpplne laws, so noL LhaL provlslon ln Lhe Clvll Code should be made
Lo apply. Pow dld Lhe CourL resolve Lhls lssue? SC sald !"# )*" ,'-*" does noL apply, because Lhls only
applles Lo slLuaLlons where Lhere's a dlspuLe as Lo Lhe ownershlp, LlLle or possesslon of Lhe properLy.
Cbvlously ln Lhls case, Lhere ls no dlspuLe as Lo ownershlp, because all parLles agreed LhaL lL belonged Lo
Lhe hlllpplnes and Lhere was no oLher clalmanL. So Lhere was obvlously no dlspuLe of LlLle, ownershlp
or possesslon of Lhe properLy. LvenLually Lhe SC dlsallowed Lhe sale of Lhe properLy on Lhe ground LhaL
Lhere was no auLhorlLy on Lhe parL of Lhe governmenL Lo dlspose of lL because Lhere was no approval by
Congress. lL was argued LhaL when a properLy consldered Lo be parL of Lhe publlc domaln has ceased Lo
be used for a publlc purpose, lL can only be sub[ecLed Lo any commerclal LransacLlon lf lL's converLed
lnLo an allenable properLy, and Lhls converslon should be done by Congress. ln Lhls case, Lhere was
obvlously no auLhorlLy Lo dlspose or Lo sell Lhe properLy.
My problem here ls LhaL Lhe maLLer of auLhorlLy on Lhe parL of Lhe execuLlve Lo sell Lhe properLy ls a
maLLer LhaL ls rlghLfully covered by !"# )*" ,'-*", because lL concerns Lhe capaclLy of a conLracLlng parLy.
Clven LhaL Lhe execuLlve was supposed Lo be Lhe seller, and Lhe lssue ls wheLher Lhe seller has Lhe
capaclLy or auLhorlLy Lo sell or noL, lL Lhen falls under Lhe lssue of capaclLy of Lhe conLracLlng parLles.
8ecause ln our prevlous dlscusslon, lL was esLabllshed LhaL !"# )*' ,'-*" covers all maLLers perLalnlng Lo
properLy, lncludlng capaclLy of conLracLlng parLles. Anyway, ln LhaL case, lL was clear LhaL Lhe SC sald
LhaL lf Lhe dlspuLe does noL lnvolve ownershlp, LlLle or possesslon, !"# )*" ,'-*" should noL be applled.
8uL l Lhlnk LhaL LhaL rullng Lhere should be clrcumscrlbed Lo Lhe pecullar clrcumsLances ln LhaL case, and
noL as a blankeL auLhorlLy Lo LransacLlons where no dlspuLe of ownershlp ls lnvolved - oLherwlse,
formallLles of conLracL may no longer be governed by !"# )*" ,'-*". lf Lhere ls no dlspuLe as Lo ownershlp.
lor example, Lhere's a deed of sale lnvolvlng properLy and Lhere ls an lssue as Lo lLs valldlLy because lL
was made orally. 1here was no dlspuLe as Lo ownershlp, LlLle or possesslon, buL only lnsofar as Lhe
!"#$%&'( "$ *+,- .&/(012 3456

%$

formallLy ls concerned. 8uL agaln, and as dlscussed earller, Lhls ls covered by !"# )*" ,'-*" as held ln Lhe
case of 8epubllc vs Sandlganbayan. !usL Lake noLe of Lhese cases.
E2--:554/8b :F-:<74/8 7/ &"8 94" 0',4"
now so golng back Lo whaL l sald earller, whaL are Lhe excepLlons Lo Lhe !"# )"' prlnclple? number one ls
even lf Lhe dlspuLe lnvolves properLy, !"# )*" ,'-*" does noL apply lf Lhe lssue ls abouL Successlon. So lf
Lhe lssue ls wheLher or noL a person may lnherlL Lhe properLy from Lhe decedenL, Lhls clearly lnvolves a
properLy slnce lL's abouL a dlspuLe of ownershlp over a cerLaln properLy. 1hls ls noL governed by !"# )*"
because Lhe lssue ls Successlon. 1hls ls under Lhe 2
nd
paragraph of ArLlcle 16 whlch sLaLes LhaL 'however,
LesLaLe or lnLesLaLe successlon, boLh wlLh respecL Lo order of successlon, amounL of successlonal rlghLs,
and Lhe valldlLy of Lhe LesLamenLary provlslons of Lhe wlll are governed by Lhe naLlonal law of Lhe
decedenL'. 1he order of successlon concerns lLself wlLh answerlng as Lo who among Lhe helrs shall
lnherlL flrsL, second, Lhlrd, eLc. ln your Wllls and Successlon, Lhe law has an order of preference, whereln
Lhe presence of some may exclude Lhe oLhers. So agaln, lf Lhe lssue ls order of Successlon, Lhen Lhe
naLlonal law of Lhe decedenL applles, noL Lhe naLlonal law of Lhe helr. 1he amounL of successlonal rlghLs
on Lhe oLher hand, concerns lLself wlLh Lhe lssue of how much an helr geLs, and Lhls ls llkewlse governed
by Lhe naLlonallLy law under arLlcle 16. llnally, Lhe valldlLy of Lhe LesLamenLary provlslons of Lhe wlll
seeks Lo answer quesLlons such as Lhe presence of preLerlLlon or dlslnherlLance ln Lhe wlll, or Lhe
provlslons LhaL may be found ln Lhe wlll. 1he valldlLy of Lhese provlslons are governed by Lhe naLlonal
law of Lhe decedenL under ArLlcle 16, [usL llke Lhe earller Lwo menLloned.
WhaL abouL Lhe capaclLy of Lhe helr Lo lnherlL? Cbvlously, Lhls ls noL covered by Lhe 2
nd
paragraph of
ArLlcle 16 because Lhe provlslon (ArLlcle 16) only covers Lhe Lhree: order of successlon, amounL of
successlonal rlghLs, and Lhe valldlLy of LesLamenLary provlslons of Lhe wlll. 1ake noLe however LhaL
under ArLlcle (1239(?)), Lhe capaclLy Lo lnherlL ls llkewlse governed by Lhe naLlonal law of Lhe decedenL.
So all ln all, Lhere are acLually 4 lnsLances when/where Lhe naLlonal law of Lhe decedenL governs, and all
of Lhese collecLlvely refer Lo Lhe lnLrlnslc valldlLy of Lhe wlll. Agaln, and Lo summarlze Lhls for emphasls:
(1) order of successlon, amounL of successlonal rlghLs, (3) valldlLy of LesLamenLary provlslons, and (4)
Lhe capaclLy of Lhe helr Lo lnherlL.
a;:3: <3/<:37@ 45 =:3:A@ 48-46:87,A 7/ 7;: -,5: ,7 ;,86b :F-:<74/8 7/ &"8 94" 0',4"
1he second excepLlon Lo !"# )*" ,'-*" ls a LransacLlon whlch lnvolves properLy, buL whlch lnvolvemenL ls
merely lncldenLal because Lhe real lssue ls Lhe rlghLs and obllgaLlons of Lhe parLles. Agaln, lL mlghL
lnvolve properLy, buL lL's merely lncldenLal Lo Lhe maln LransacLlon, whlch ls an ordlnary conLracL. lor
example, Lhere ls a conLracL execuLed beLween Mr. Camlnade and Ms. Salas lnvolvlng Mr. Camlnade's
engagemenL as an archlLecL, so he can deslgn Ms Salas' manslon. Cbvlously, Lhls ls a LransacLlon
lnvolvlng properLy, because lL lnvolves Lhe manslon of Ms. Salas. Powever here, properLy ls only
lncldenLal, because lL's really a conLracL of servlce, because Lhe maln LransacLlon lnvolves Lhe servlces of
!"#$%&'( "$ *+,- .&/(012 3456

%%

Mr. Camlnade as an archlLecL Lo Ms. Salas' manslon. So agaln, Lhls ls noL governed by !"# )*" ,'-*",
because Lhls ls an ordlnary conLracL, Lhe capaclLy of parLles should be governed by ArLlcle 13 (noL sure
because lnaudlble), or Lhe naLlonal law of Lhe parLles. LxLrlnslc valldlLy should Lhen be deLermlned by !"#
&"!"()*-'%+', and Lhe lnLrlnslc valldlLy by !"# &%+-)*&-.,. 1haL's Lhe second excepLlon.
;4$9"& 102 <49('4b :F-:<74/8 7/ &"8 94" 0',4"
1he Lhlrd excepLlon ls, agaln, Lhe case of Laurel vs. Carcla, buL agaln class, please conslder LhaL as an
excepLlonal case, and also relaLlve Lhe pecullar aLLendanL clrcumsLances of LhaL speclflc case.
cQ;/5:5 48 D/55:554/8d ,86 cQ;/5:5 48 W-74/8de -/85732-749: 54725
:"# )*" ,'-*" ls noL dlfflculL Lo apply when Lhe properLy ls ln a flxed physlcal locaLlon, such as a land, or a
bulldlng perhaps. When Lhls ls Lhe case, lL may noL be dlfflculL Lo ascerLaln Lhe locaLlon because lL's
locaLed ln one counLry only, so you [usL have Lo apply LhaL counLry's perLlnenL laws. Powever, lL may be
dlfflculL when Lhe properLy has no flxed physlcal locaLlon, as when Lhe properLy ls ln a consLanL sLaLe of
movlng, from one counLry Lo anoLher. Cr also when Lhe properLy ls an lnLanglble properLy, so you
cannoL really aLLrlbuLe a flxed physlcal presence Lo lL.
Pow do you deLermlne !"# )*" ,'-*" ln Lhese pecullar clrcumsLances Lhen?
When Lhe properLy has no flxed permanenL locaLlon, Lhe law asslgns Lhem Lhelr so-called 'consLrucLlve
slLus', whlch should be consldered when applylng !"# )*" ,'-*". 1here are Lwo classlflcaLlons lnvolvlng
Lhese parLlcular properLles: Lhe so-called (1) 'choses ln possesslon', referrlng Lo properLles whlch are ln
Lhe consLanL sLaLe of moLlon, llke movlng vessel, or goods ln LranslL. 1hese are properLles wlLhouL a flxed
physlcal presence, and Lhe (2) second classlflcaLlon ls Lhe so-called 'choses ln acLlon', whlch refer Lo
lnLanglble properLles llke credlLs, debLs, Lhe goodwlll of a buslness, sLocks ln a corporaLlon, franchlse,
and/or lnLellecLual properLy. lor boLh Lhese lnsLances, and slnce one cannoL esLabllsh a deflnlLlve
physlcal presence, Lhe law asslgns Lhem Lhelr consLrucLlve slLus.
WhaL's Lhe rule ln 'choses ln possesslon'? ln a movlng vessel for example, lf lL's a publlc vessel, Lhe
consLrucLlve slLus ls Lhe law of Lhe flag (of Lhe vessel) or Lhe law of Lhe counLry of Lhe vessel. lf lL's a
prlvaLe or commerclal vessel, Lhe consLrucLlve slLus ls law of Lhe counLry of reglsLer, buL lf Lhe/a vessel ls
docked ln a forelgn porL, LhaL counLry ls consldered as Lhe vessel's Lemporary slLus.
WhaL abouL Lhe consLrucLlve slLus of goods ln LranslLu? As Lo Lhe law governlng Lhe lmpuLaLlon of
llablllLy for Lhelr deLerloraLlon, loss or damage, Lhe consLrucLlve slLus Lhere ls Lhe polnL of desLlnaLlon. lf
Lhe goods are Lo be shlpped from !apan Lo korea and whlle ln LranslL Lhe goods suffered some
deLerloraLlon or loss, Lhe quesLlon of llablllLy ls governed by Lhe laws of korea, Lhe counLry of
desLlnaLlon.
!"#$%&'( "$ *+,- .&/(012 3456

%&

Suppose durlng Lhe LranslL, or ln Lhe course of Lhe LranslL, Lhe goods were selzed, whaL law governs Lhe
valldlLy or lnvalldlLy of Lhe selzure of goods? 1he law says LhaL Lhe valldlLy of selzure of goods '+ -)*+,'-.
ls governed by Lhe law of Lhe counLry where Lhe selzure was effecLed.
WhaL abouL lf Lhe goods '+ -)*+,'-. are Lo be sub[ecLed Lo cerLaln conLracLs, llke sale, morLgage, or any
LransacLlon lnvolvlng conveyance, dlsposlLlon, or allenaLlon? WhaL ls Lhe consLrucLlve slLus of Lhese
LransacLlons? under Lhe law, Lhe valldlLy of Lhe sale, dlsposlLlon or allenaLlon of goods '+ -)*+,'-. shall
be governed by !"# &%+-)*&-.,, whlch could elLher be, !"# !%&' 4%!.+-*-',, or !"# !%&' ';0"7'.; (noL sure,
because lnaudlble)? We wlll dlscuss Lhls as we Lake Lhls up laLer.
now leL's go Lo Lhe 'choses ln acLlon'. WhaL's Lhe rule lnsofar as choses ln acLlon are concerned? WhaL's
Lhe rule as Lo debLs and credlLs (credlLs for Lhe credlLor and debLs as Lo Lhe debLor)? WhaL's Lhe
consLrucLlve slLus of obllgaLlon? under Lhe law, lL's Lhe law of Lhe counLry where Lhe debLor may be
served wlLh summons. WhaL abouL sLocks ln a corporaLlon? WhaL governs Lhe valldlLy of Lhe dlsposlLlon,
encumberance or asslgnmenL of shares of sLock ln a corporaLlon? 1helr consLrucLlve slLus ls Lhe law of
Lhe counLry where Lhe corporaLlon was lncorporaLed. We deLermlne Lhe place of lncorporaLlon of Lhe
corporaLlon lnvolved. WhaL abouL Lhe goodwlll ln a buslness? WhaL laws, under !"# )*" ,'-*", apply Lo
goodwlll? under Lhe law, Lhe consLrucLlve slLus ls Lhe law of Lhe place where Lhe buslness ls belng
carrled ouL.
now leL's go Lo franchlses and lnLellecLual properLles (lL). lranchlses are prlvlleges exLended by Lhe
soverelgn auLhorlLy Lo an lndlvldual or corporaLlon, and under )"# !*" ,'-*", Lhe consLrucLlve slLus ls Lhe
law of Lhe counLry whlch granLed Lhe franchlse. lnLellecLual properLy, on Lhe oLher hand, slnce Lhey are
proLecLed by Lhe sLaLe LhaL granLs and recognlzes lL (Lhe lnLellecLual properLy), Lhe consLrucLlve slLus ls
Lhe law of Lhe counLry whlch proLecLs and recognlzes Lhe lnLellecLual properLy. 1hese are Lhe varlous
rules governlng Lhe slLus of properLles or consLrucLlve slLus of properLles whlch have no flxed physlcal
presence, or locaLlon.

M2A:5 489/A948> a4AA5 ,86 E2--:554/8
LeL's now go Lo Lhe confllcL of laws lnvolvlng Wllls and Successlon. Accordlng Lo Lhe second paragraph of
ArL 16, Lhe valldlLy of wllls ls deLermlned by Lwo aspecLs: (1) Lhe exLrlnslc valldlLy and of course Lhe (2)
lnLrlnslc valldlLy. 1he exLrlnslc valldlLy refers Lo Lhe forms and solemnlLles whlch are requlred, whlle Lhe
lnLrlnslc valldlLy refers Lo Lhe subsLanLlve aspecL of Lhe wlll. under ArLlcle 16 paragraph 2, LesLaLe or
lnLesLaLe successlon shall be governed by Lhe naLlonal law of Lhe decedenL. 1he lnLrlnslc valldlLy of a wlll,
as expressed ln ArLlcle 16, paragraph 2, ls governed by Lhe naLlonal law of decedenL, and pursuanL Lo
ArLlcle 1039, Lhe naLlonal law of Lhe decedenL also governs Lhe capaclLy of an helr Lo lnherlL. 1o sum lL
!"#$%&'( "$ *+,- .&/(012 3456

%'

all up, Lhere are 4 lLems governed by ArLlcle 16 paragraph 2, whlch calls for Lhe appllcaLlon of Lhe
naLlonal law of decedenL.
WhaL abouL Lhe exLrlnslc aspecL of a wlll? LxLrlnslc valldlLy ls noL governed by Lhe naLlonal law of Lhe
decedenL, buL lL depends on varlous rules, dependlng on who execuLes Lhe wlll and where Lhe wlll was
execuLed. WhaL falls under exLrlnslc valldlLy for forms and solemnlLles? 1he exLrlnslc aspecL lncludes
(among oLhers) Lhe followlng maLLers: (1) as Lo Lhe requlred forms or solemnlLles, (2) as Lo wheLher lL
has Lo be oral or wrlLLen, (3) as Lo wheLher lL has Lo be noLarlal or hologrpahlc, (4) as Lo wheLher Lhe wlll
requlres lnsLrumenLal wlLnesses, (3) as Lo how many wlLnesses are requlred, eLc. ln addlLlon, Lhe age
and capaclLy of Lhe LesLaLor are consldered parL of exLrlnslc valldlLy of a wlll. ?ou need Lo Lake noLe of
Lhls: whlle Lhe capaclLy of an helr Lo lnherlL ls consldered lnLrlnslc and ls governed by Lhe naLlonal law
under 1039, Lhe age or legal capaclLy of LesLaLor who execuLes wlll falls under exLrlnslc valldlLy.
WhaL are Lhe rules governlng Lhe exLrlnslc valldlLy of a wlll? 1he followlng rules govern Lhe exLrlnslc
valldlLy of a wlll execuLed by an allen ouLslde of Lhe hlllpplnes. Cne, law of Lhe place where Lhe wlll was
execuLed. under ArLlcle 17 of Lhe Clvll Code, Lhe forms and solemnlLles of conLracLs, wllls and oLher
publlc lnsLrumenLs shall be governed by Lhe law or place where conLracL was execuLde. So lf an allen
execuLes a wlll abroad, LhaL wlll wlll be consldered valld ln Lhe hlllpplnes lf lL was execuLed ln
accordance wlLh Lhe law of Lhe counLry where lL was execuLed, pursuanL Lo SecLlon 17.

xxx

So lf an allen execuLes a wlll abroad, LhaL wlll ls valld and wlll be recognlzed ln Lhe hlllpplnes as valld lf lL
was execuLed ln accordance wlLh Lhe law of Lhe counLry where lL was execuLed pursuanL Lo ArLlcle 17.

Second law: 1haL wlll execuLed by an allen abroad may also be consldered valld and lLs effecLs
recognlzed ln Lhe hlllpplnes lf lL was execuLed ln accordance wlLh Lhe Allen's naLlonal Law. 1hls ls ln
accordance wlLh ArLlcle 816 of Lhe Clvll Code.

So you have Lex Locl Celebraclonls under ArLlcle 17. Second you have Lex naLlonall under ArLlcle 816.
1haL wlll execuLed by an Allen abroad may also be consldered valld and lLs effecLs recognlzed ln Lhe P lf
execuLed ln accordance wlLh Lhe laws of Lhe counLry of whlch Lhe LesLaLor was domlclled! Lex uomlclll -
Lhe law of Lhe counLry of whlch Lhe LesLaLor was a domlclle.

And Lhe fourLh one ls: 1haL wlll execuLed by an allen abroad may be consldered valld and lLs effecLs
recognlzed ln Lhe P lf lL ls execuLed ln accordance wlLh P law. So far as WlLLS LxLCu1Lu 8? An ALlLn
A88CAu, Lhere are lCu8 governlng laws LhaL deLermlne Lhe valldlLy of Lhe Lx18lnSlC aspecL of Lhe wlll.
!"#$%&'( "$ *+,- .&/(012 3456

%(

lf Lhe wlll complles wlLh Lhe formallLles prescrlbed under elLher of Lhese laws, Lhe wlll may be probaLed
and lLs effecLs recognlzed ln Lhe P.

Lex locl Celebraclonls under ArLlcle 17, Lex naLlonall, Lex uomlclll and P Law - Lhe lasL Lhree laws are
pursuanL Lo ArLlcle 816.

Second slLuaLlon: lf Lhe wlll was execuLed by a llllplno abroad. WhaL law deLermlnes Lhe exLrlnslc
valldlLy of Lhe wlll lf Lhe LesLaLor ls a llllplno buL Lhe wlll was execuLed abroad?

number 1!, LhaL wlll may be probaLed ln Lhe P and lLs effecLs recognlzed here when lL was execuLed ln
accordance wlLh Lhe formallLles prescrlbed under Lhe laws of Lhe place of Lhe counLry where Lhe wlll was
execuLed. 8asls ls ArLlcle 17, lex locl celebraclonls. And ArLlcle 813, lL says Lex locl Celebraclonls. ArLlcle
813 [usL afflrms ArLlcle 17. 1hey are Lhe same - boLh provlde for lex locl celebraclonls. 1ake noLe LhaL
Lhere ls absence of any provlslon ln our laws whlch provldes LhaL a llllplno clLlzen may execuLe a wlll
abroad followlng Lhe formallLles prescrlbed under P laws. 1here ls no such provlslon ln our own laws.
8uL, accordlng Lo SenaLor ArLuro 1olenLlno, he sald, whlle obvlously our CCL 8ule on Lhe LxLrlnslc
valldlLy of a wlll execuLed by a llllplno adheres Lo lex locl celebraclonls, lL cannoL be assumed and lL ls
noL Lo be assumed LhaL Lhe framers of our laws, Lhe clvll code, Lhe code commlsslon, meanL Lo lnvalldaLe
a wlll execuLed by a llllplno abroad followlng P law because accordlng Lo hlm, lL cannoL be assumed
LhaL Lhe framers lnLend Lo place Lhe llllplno aL a dlsadvanLage Lhan a forelgner. 8ecause lf a forelgner
may execuLe a wlll abroad followlng Lhe formallLles prescrlbed under P law, Lhen Lhere ls no reason
why a llllplno may noL execuLe a wlll abroad followlng hls own law. lL makes sense, buL agaln, Lhe duLy
of Lhe courL ls Lo apply Lhe law. And lf Lhe law ls clear enough and leaves no doubL, Lhe courL may noL
resorL Lo Lhe wlsdom of Lhe law. Cur own rules, pursuanL Lo 17 and 813, leave no doubL abouL our own
pollcy on lex locl celebraclonls ln so far as llllplno clLlzens are concerned. 1o exLend appllcaLlon of 17
and 813 Lo a slLuaLlon where a llllplno execuLes a wlll abroad wlll be noLhlng buL [udlclal leglslaLlon. l do
belleve LhaL whlle 1olenLlno's argumenL ls favoured by loglc and Lhe lnLeresL of llllplno, Lhls needs Lhe
cooperaLlon of Congress. Amend! no rullng sLlll abouL 1olenLlno's oplnlon. up Lo now, lL's [usL LhaL - an
oplnlon.

AncheLa case
We dlscuss Lhe case of AncheLa v. Someone
1
. 1here was Lhls Amerlcan couple who reslded ln Lhe P for
LhlrLy years, 8lchard and Audrey (?). When Lhe wlfe dled, she lefL a wlll execuLed ln Maryland, uSA and
ln LhaL wlll Lhe wlfe bequeaLhed all her esLaLe Lo her husband, 8lchard. AfLer Lhe deaLh of Lhe wlfe,
8lchard re-marrled Candy (noL her real name) ln Lhe P. lorLunaLely for Candy, 8lchard dled Lhree years
afLer. So she sLood Lo beneflL slzeable forLune. ln Lhe wlll of 8lchard, whlch was also execuLed and
probaLed ln Maryland, uSA, 8lchard bequeaLhed all hls esLaLe Lo Candy. Pls share ln Lhe shares of sLocks

1
lncohewenL
!"#$%&'( "$ *+,- .&/(012 3456

%)

of cerLaln buslnesses. 1he wlll of Audrey was probaLed ln Maryland. An admlnlsLraLor was appolnLed
was Maryland CourL buL slnce some of Lhe properLles are locaLed ln Lhe P, an anclllary AdmlnlsLraLor
was also appolnLed ln Lhe P and Lhe wlll was re-probaLed ln Lhe P. So a wlll already probaLed abroad
ls soughL Lo be enforced ln Lhe P - so reprobaLe proceedlngs. 1hls ls acLually recognlLlon and
enforcemenL of a forelgn [udgmenL. lor purposes of Lhe reprobaLe proceedlngs, Lhe anclllary
admlnlsLraLor, ALLy. Alfonso AncheLa, Lhe senlor parLner ln Manlla, flled a moLlon ln Lhe reprobaLe courL
Lo declare 8lchard and kyle (adopLed) as Lhe helrs of Audrey.

Cn Lhe oLher hand, Lhe wlll of 8lchard was also probaLed ln Maryland and reprobaLed ln Lhe P, and
anclllary AdmlnlsLraLor was also appolnLed - Lhe parLner of ALLy. AncheLa, acLed as Lhe anclllary
admlnlsLraLor. ln so far as Lhe 8eprobaLe proceedlngs of Audrey's wlll, ALLy. AncheLa flled a (pro[ecL) of
parLlLlon. 1hls ls a sLage ln Lhe probaLe proceedlngs where Lhe lnLrlnslc aspecL of Lhe wlll ls Lo be
lmplemenLed - Lhls concerns Lhe acLual sharlng and Lhe dlsLrlbuLlon of Lhe esLaLe of Lhe deceased ln
accordance wlLh Lhe Lerms and condlLlons. 1ake noLe LhaL ln Audrey's wlll, she bequeaLhed all her esLaLe
ln favour of Lhe husband buL ln Lhe pro[ecL of parLlLlon prepared and submlLLed by ALLy. AncheLa, he
(AncheLa) apporLloned a porLlon of Lhe properLles Lo Lhelr adopLed chlld, kyle. So lnsLead of Lransferrlng
Lhe ownershlp over Lhe enLlre esLaLe of Audrey ln Lhe name of 8lchard, Lhe properLy was Lransferred
under Lhe names as co-owners Lo Lhe exLenL of 2/3 (?).

kyle was glven hls own share ln Lhe esLaLe of Lhe moLher, conLrary Lo Lhe Lerms and wlshes of Audrey as
expressed ln Lhe wlll. WlLh respecL Lo Lhe wlll of 8lchard, slnce Lhe enLlre of properLy/esLaLe of Audrey
was supposed Lo be Lransferred Lo 8lchard, (buL a porLlon was apporLloned Lo kyle) noL Lhe enLlre esLaLe
of Audrey were LransmlLLed ln favour of 8lchard buL only a porLlon. 1hls was affecLed by Lhe pro[ecL of
parLlLlon submlLLed by ALLy. AncheLa ln Lhe reprobaLe proceedlngs lnvolvlng Lhe wlll of Audrey. AL Lhe
end of Lhe day, Candy reallzed LhaL her share/lnLeresL as an helr of 8lchard was adversely affecLed. So,
Candy flled a moLlon Lo nulllfy Lhe order of Lhe courL approvlng Lhe pro[ecL of parLlLlon.

ALLy. AncheLa was accused of beLraylng hls flduclary duLy as an Anclllary AdmlnlsLraLor. Pls defense was
LhaL, he prepared Lhe pro[ecL of parLlLlon where he apporLloned a porLlon of Lhe esLaLe of Audrey ln
favour of kyle, ln good falLh because aL LhaL Llme, he was noL aware of Lhe exacL law of Maryland - Lhe
naLlonal law of Audrey. And he dldn'L because he honesLly belleved LhaL applylng P law would serve
Lhe lnLeresL of all Lhe helrs conslderlng LhaL Lhey would geL all Lhelr [usL shares.

SC: under ArLlcle 16, second paragraph, Lhe lssue of amounL of successlonal rlghLs perLalns Lo Lhe
lnLrlnslc aspecL of Lhe wlll, and Lherefore under 2
nd
paragraph of ArLlcle 16, Lhey should be governed by
Lhe naLlonal law of Lhe decedenL. Slnce Audrey ls a clLlzen of SLaLe of Maryland, Lhls lssue should have
been governed by Lhe laws of Maryland. ALLy. AncheLa cannoL felgn lgnorance of Lhe Maryland law
belng a senlor parLner of a very presLlglous and blg law flrm. Second, Lhere was breach of hls flduclary
!"#$%&'( "$ *+,- .&/(012 3456

%*

duLy when he dld noL exerL efforL Lo prove Lhe Maryland law on Lhe maLLer. Pe should know LhaL under
ArLlcle 16 Lhe lnLrlnslc valldlLy of Audrey's wlll ls governed by Audrey's naLlonal law. 1hls case relnforces
Lhe provlslon of ArLlcle 16, second paragraph on wllls and successlon, parLlcularly Lhe lnLrlnslc aspecL
belng governed by Lhe naLlonal law of Lhe decedenL.

1ake noLe also LhaL ln Lhe case of alaganas (?), lf a wlll was execuLed by an allen abroad, lL ls noL
requlred LhaL Lhe wlll be flrsL probaLed abroad because a wlll execuLed by an allen abroad may be
probaLed for Lhe flrsL Llme ln Lhe P so long as lL lnvolves properLles locaLed ln Lhe P.

ln Lhls case, a wlll was execuLed by a P clLlzen who became an Amerlcan clLlzen who dled chlld-less.
When Lhe wlll was probaLed for Lhe flrsL Llme ln Lhe P, lL was ob[ecLed Lo by Lhe nephews, argulng LhaL
slnce Lhe wlll was execuLed by an allen abroad, lL cannoL be probaLed ln Lhe P for Lhe flrsL Llme. SC sald
Lhere ls no law LhaL prohlblLs a wlll execuLed by an allen abroad Lo be probaLed ln Lhe P for Lhe flrsL
Llme. AlLhough we have a rule, under 8ule 77 LhaL a wlll already probaLed abroad, may be reprobaLed ln
Lhe P. 8uL Lhls ls a dlfferenL proceedlngs because under ArLlcle 73, any wlll execuLed when execuLed by
a llllplno wheLher execuLed ln Lhe P or abroad may be pwobaLed for Lhe flrsL Llme. 1haL ls Lhe rullng ln
alaganas (?).

8ules regardlng revocaLlon of wllls.
1he rule depends on Lhree slLuaLlons.
llrsL scenarlo: lf Lhe revocaLlon ls made ouLslde Lhe P by a LesLaLor who ls noL domlclled ln Lhe P, lL ls
valld when lL follows elLher of Lhe followlng rules: (1) 1he law of Lhe counLry where Lhe wlll was
execuLed, lex locl celebraclonls, or (2) 1he revocaLlon ls valld when lL ls done ln accordance wlLh Lhe laws
of Lhe counLry where Lhe LesLaLor was domlclled aL Lhe Llme of revocaLlon pursuanL Lo ArLlcle 829 of Lhe
Clvll Code.

Second scenarlo: a revocaLlon made ouLslde Lhe P by a person domlclled ln Lhe P. So Lhe revocaLlon
Look place ouLslde, buL Lhe LesLaLor ls domlclled ln Lhe P. 1he revocaLlon ls valld when lL complles wlLh
Lhe law of Lhe counLry where Lhe LesLaLor ls domlclled - meanlng P laws or lf lL was done ln accordance
wlLh Lhe law of Lhe counLry where Lhe revocaLlon was made.

1hlrd scenarlo: lf Lhe revocaLlon ls made ln Lhe P wheLher by someone domlclled ln Lhe P or noL.
8evocaLlon ls valld lf lL ls done ln accordance wlLh P laws.

!"#$%&'( "$ *+,- .&/(012 3456

&C

!olnL Wllls
1he rule depends on wheLher Lhe LesLaLor ls a llllplno or an allen. 1he rule depends on Lhe counLry of
execuLlon. lf a [olnL wlll ls execuLed by allens ouLslde of Lhe P lL ls valld here lf valld ln accordance wlLh
Lhe laws where lL was execuLed: lex locl celebraclonls. lf execuLed by llllplno clLlzens wheLher abroad or
ln Lhe P, [olnL ls vold by reason of publlc pollcy. lf execuLed by forelgners ln Lhe P Lhen vold by reason
of publlc pollcy. lf execuLed by mlxed forelgner and llllplno, lL ls vold ln so far as llllplno by reason of
publlc pollcy buL valld ln so far as lorelgner lf valld ln (accordance wlLh Lhe law of) Lhe place of
execuLlon.

ConLracLs
lor ordlnary conLracLs, Lhe valldlLy of an ordlnary conLracL - meanlng a conLracL whlch does noL lnvolve
(???) ls deLermlned by lLs Lhree componenLs. number 1: capaclLy of Lhe conLracLlng parLles, number 2:
forms and solemnlLles or lLs exLrlnslc valldlLy and number 3: lnLrlnslc valldlLy.

ConLracLlng arLles
1ake noLe, by vlrLue of ArLlcle 13, capaclLy of conLracLlng parLles are governed by Lhe arLles' respecLlve
naLlonal laws excepL lf Lhe conLracL lnvolves properLles where lex rel slLae applles.

LxLrlnslc valldlLy
1he formallLles - forms and solemnlLles of conLracLs, pursuanL Lo ArLlcle 17 are governed by lex locl
celebraclonls.

lnLrlnslc valldlLy
1here ls no law ln our [urlsdlcLlon LhaL expressly provldes for ConfllcL of Laws rule on Lhe lnLrlnslc valldlLy
of conLracLs. 8uL Lhe prlnclple adopLed by mosL legal sysLems whlch ls also adopLed ln our [urlsdlcLlon ls
LhaL lnLrlnslc valldlLy of conLracLs ls governed lex conLracLus (whaLever lL means) - Lhe law of Lhe
conLracL.

WhaL ls Lhe law of Lhe conLracL?
under arLlcle 1306 of Lhe Clvll Code, conLracLlng parLles may esLabllsh Lerms and condlLlons as Lhey may
flnd convenlenL provlded Lhey are noL conLrary Lo law, morals, good cusLoms, publlc order and publlc
pollcy. 1he prlnclple of llberallLy of conLracLs. 1aklng cue from Lhls prlnclple of llberallLy of conLracLs,
auLhorlLles are one ln holdlng LhaL Lhe CCL rules on Lhe lnLrlnslc valldlLy of conLracLs ls Lhe law agreed
upon by Lhe parLles, conslsLenL wlLh llberallLy of conLracLs. So whaL Lhe parLles agreed upon as Lhe
governlng law of Lhe conLracL should be followed. Lex ConLracLus refers Lo number 1: Lhe law expressly
agreed upon by Lhe parLles or Lhe so called lex volunLaLls. And second, Lhe lex lnLenLlonls(?).

Lex volunLaLls
!"#$%&'( "$ *+,- .&/(012 3456

&!

Lex volunLaLls ls usually expressed ln Lhe so-called cholce of law clause whlch ls a sLandard provlslon ln
conLracLs lnvolvlng forelgn elemenLs. 1he lnLrlnslc valldlLy of conLracL, parLlcularly Lhe lex volunLaLls can
be ascerLalned by Lhe courL by looklng aL Lhe Lerms and condlLlons of Lhe conLracL lf Lhe conLracL
conLalns a cholce of law clause where Lhe parLles expressly sLlpulaLes Lhe speclflc law LhaL governs a
dlspuLe LhaL may arlse from Lhe conLracL Lhen LhaL ls Lhe lex conLracLus and Lhe courL shall accordlngly
apply Lhe law agreed upon by Lhe parLles. 8uL noL all conLracLs may conLaln Lhe so-called cholce of law
clause. WhaL Lhen ls Lhe lex conLracLus - whaL law shall govern Lhe lnLrlnslc aspecL of Lhe conLracL?

ln Lhls case, where Lhere ls no cholce of law clause LhaL expresses Lhe speclflc law agreed upon Lhe
parLles, Lhe courL may now ascerLaln Lhe lex lnLenlonls.

Lex lnLenLlonls
1hls ls Lhe law noL expressly agreed upon - noL found ln Lhe conLracL buL expressly or lmplledly lnLended
by Lhe parLles. under Lhe clrcumsLances lL can be lnferred LhaL Lhls ls Lhe law lnLended by Lhe parLles.
Pow does Lhe courL deLermlne LhaL Lhe law lnLended by Lhe parLles expressly or lmplledly ls Lhls
parLlcularly law lf Lhls law ls noL expressly found or cannoL be found on Lhe face of Lhe conLracL? lor Lhls
purpose, Lhe courL may now apply Lhe so-called sLaLe of Lhe mosL slgnlflcanL relaLlonshlp rule.

MosL SlgnlflcanL 8elaLlonshlp 8ule
under Lhls prlnclple, Lhe courL wlll deLermlne whlch of Lhe counLrles lnvolved has Lhe mosL slgnlflcanL
relaLlonshlp Lo Lhe parLles and Lo Lhe LransacLlon. 1hls was Lhe rullng ln Lhe case of hlllpplne LxporL
lorelgn Loan CuaranLy CorporaLlon v. Someone.

hlllpplne LxporL Loan CuaranLy CorporaLlon v. Someone
1hls case lnvolves a conLracL beLween Lhe lraql governmenL and a llllplno corporaLlon for Lhe
consLrucLlon of hyslcal 1herapy medlcal rehablllLaLlon cenLre ln lraq durlng Lhe helghL of lraq-lran. 1he
lraql governmenL awarded Lhe pro[ecL Lo a Lradlng corporaLlon accredlLed by Lhe kuwalLl governmenL.
lor Lhe purpose of Lhls conLracL, Lhls kuwalLl Lradlng company enLered lnLo a [olnL venLure agweemenL
wlLh a P conLracLor. 8uL slnce Lhls conLracLor ls noL accredlLed by Lhe cerLaln governmenL agency whlch
accredlLs hll conLracLors underLaklng pro[ecLs abroad lL asslgned lLs rlghLs under Lhe [olnL venLure ln
favour of (Luseblo). 8uL P conLracLor (noL accredlLed) and Luseblo enLered lnLo an agreemenL LhaL Lhe
pro[ecL shall be sub[ecL Lo Lhelr [olnL managemenL.

lasL forward, Lhe conLracL was enLered lnLo beLween Lhe lraql governmenL and Luseblo. As a condlLlon
Lo Lhe pro[ecL, one of Lhe condlLlons was LhaL Lhe conLracLor shall posL a performance bond. ursuanL Lo
Lhls requlremenL, Luseblo applled for leLLers of guaranLy wlLh hll CuaranLy - a governmenL-owned
corporaLlon whlch lssues guaranLles Lo secure pro[ecL underLaklngs by local conLracLors. 8uL Lhe leLLers
of guaranLy lssued by hll CuaranLy was dlsapproved by Lhe lraql governmenL. 1he lraql governmenL
!"#$%&'( "$ *+,- .&/(012 3456

&#

lnslsLed LhaL Lhe guaranLy should be lssued by an lraql bank. 1o comply wlLh Lhe wlshes of Lhe
governmenL, lraql bank lssued leLLers of guaranLy buL Lhe lraql bank requlres a bond Lo be posLed by
anoLher bank. So Lhls Llme, anoLher bank, a kuwalLl bank, lssued leLLers of guaranLy ln favour of Lhe lraql
bank buL Lhe kuwalLl bank requlres a counLer-bond. So Lhls Llme, hll CuaranLy lssued a requlred
counLer-bond. 8uL Lhe hll CuaranLy requlred a bond Lo be posLed by Luseblo. And so Luseblo and Lhe
owners lssued sureLy agreemenLs Lo secure/guaranLy Lhe exposure of hll CuaranLy. All ln all Lhere were
Lhree layers of guaranLles consLlLuLed.

under Lhe conLracL, Lhe conLracLors were supposed Lo compleLe Lhe pro[ecL wlLhln 18 <?> monLhs and
LhaL Lhe paymenLs shall be based on progress. lL was llkewlse sLlpulaLed LhaL Lhe paymenLs shall be ln
Lwo currencles. arL of Lhe paymenL shall be ln ulnar currency and parL of whlch shall be dollars. lL was
agreed LhaL Lhe uollars shall be used by Lhe conLracLor Lo lmporL maLerlals necessary for Lhe compleLlon
of Lhe pro[ecL.

lasL forward, Lhe conLracLors falled Lo compleLe Lhe pro[ecL on Llme and so Lhe bond was called by Lhe
lraql governmenL. So Lhe lraql governmenL collecLed Lhe bond posLed by Lhe lraql bank and Lhe lraql
bank collecLed Lhe bond posLed by Lhe kuwalLl bank and Lhe kuwalLl bank collecLed Lhe counLer-bond
posLed by hll CuaranLy. And so hll CuaranLy now collecLs from Luseblo as relmbursemenL arlslng from
Lhelr sureLy agreemenL. Luseblo lnsLrucLed hll CuaranLy noL Lo pay because accordlng Lo Lhem Lhe
delay ln Lhe compleLlon of Lhe pro[ecL was due Lo causes noL aLLrlbuLable Lo Lhe conLracLors buL because
of Lhe fallure of Lhe pro[ecL owner of Lhe lraql governmenL Lo comply lLs obllgaLlons Lo pay Lhe bllllngs ln
dollars. And because of lLs fallure Lo pay ln dollars, Lhe conLracLor meL dlfflculLy ln lmporLlng Lhe
necessary equlpmenL Lo be lnsLalled ln Lhe pro[ecL.
1hls wenL all Lhe way up Lo Lhe Supreme CourL aL Lhe lnsLance of hll CuaranLy sulng Luseblo and Lhe
lssue was wheLher or noL hll CuaranLy may ask for relmbursemenL from Luseblo under Lhe sureLy
agreemenL. 1he defence lnLerposed by Luseblo eL al was LhaL Lhe delay ln Lhe compleLlon of Lhe pro[ecL
was due Lo causes noL aLLrlbuLable Lo Lhe conLracLors buL due Lo Lhe faulL of Lhe lraql governmenL and
Lherefore Lhere ls no basls Lo hold Lhe guaranLors llable and Lherefore hll CuaranLy has no rlghL Lo
collecL relmbursemenL from Lhem. 1o be conLlnued.
ConLlnuaLlon of hll CuaranLy case

When Lhe conLracLors v Luseblo and 3 lex lnLernaLlonal falled Lo compleLe Lhe pro[ecL wlLhln Lhe
sLlpulaLed Llme frame, Lhe governmenL of lraq called Lhe performance bond lssued by Lhe bank of lraq.
1he bank of lraq ln Lurn called Lhe counLer bond posLed by Lhe bond ln kuwalL. And Lhe bank of kuwalL
called ln Lurn Lhe counLer bond posLed by hll CuaranLy. And when hll guaranLy falled Lo perform lLs
obllgaLlon under Lhe leLLer of guaranLy, hll CuaranLy now Lurned agalnsL v Luseblo and 3 lex _ Lo
enforce Lhe Lerms and condlLlons of Lhe sureLy underLaklng. 1he lssue ln Lhls case ls WCn hll guaranLy
ls enLlLled Lo demand for Lhe paymenL or relmbursemenL of Lhe amounL LhaL lL pald Lo Lhe bank of
kuwalL pursuanL Lo Lhe leLLers of guaranLy lssued. Cn Lhe parL of v Luseblo eL al, Lhey argued LhaL Lhe
obllgaLlon of hll CuaranLy Lo pay under Lhe leLLers of guaranLy arlses only when Lhere ls breach on Lhe
!"#$%&'( "$ *+,- .&/(012 3456

&$

parL of Lhe conLracLor v Luseblo and 3 lex of lLs obllgaLlon under Lhe conLracL. And Lhey clalm LhaL
Lhe reason for Lhe fallure or delay ln Lhe compleLlon of Lhe pro[ecL was due Lo causes noL aLLrlbuLable Lo
Lhe conLracLors buL aLLrlbuLable Lo Lhe lraql governmenL for fallure Lo comply wlLh lLs obllgaLlon Lo pay
Lhe sLlpulaLed currency. lL was clalmed LhaL because of Lhe fallure of Lhe lraql governmenL Lo pay Lhe
porLlon of Lhe bllllng ln dollars, whlch resulLed Lo Lhe lnablllLy of Lhe conLracLor Lo lmporL necessary
mechanlcal equlpmenL LhaL were supposed Lo be lnsLalled ln relaLlon Lo Lhe pro[ecL. 8ecause Lhe
equlpmenL were Lo be lmporLed and Lhe purchase prlce were pald ln dollars, whlch Lhe conLracLors dld
noL have aL LhaL Llme. ln oLher words, Lhe conLracLors were saylng LhaL Lhe obllgaLlon under Lhe leLLers
of guaranLy dld noL arlse and Lherefore hll CuaranLy should noL have pald Lhe bank of lraq under Lhe
Lerms of Lhe leLLers of guaranLy and slnce hll guaranLy was noL supposed Lo clalm lLs underLaklng under
Lhe leLLers of guaranLy, Lhe conLracLors also are noL also llable under Lhe sureLy underLaklng. And
Lherefore, hll guaranLy has no cause of acLlon Lo demand relmbursemenL. So Lhe cruclal lssue Lhere ls
WCn Lhere was delay on Lhe parL of Lhe conLracLor ln Lhe compleLlon of Lhe pro[ecL. 1he problem Lhere
ls whaL law or whlch law should deLermlne Lhe exlsLence of breach of conLracL parLlcularly whlch law
should deLermlne WCn Lhere was delay on Lhe parL of Lhe conLracLor Lo compleLe Lhe pro[ecL wlLhln Lhe
sLlpulaLed perlod. ln Lhls case, Lhe SC made menLlon LhaL Lhere ls no speclflc provlslon ln our laws LhaL
governs Lhe lnLrlnslc aspecL of Lhe conLracL. 8uL whaL ls adopLed ln mosL legal sysLems and whlch ls one
adhered Lo ln Lhe hlllpplnes ls LhaL Lhe lnLrlnslc valldlLy of Lhe conLracL ls deLermlned or governed by
Lhe so called lex conLracLus. 1ake noLe LhaL lnLrlnslc valldlLy refers Lo Lhe naLure, Lhe valldlLy, Lhe
obllgaLlon, Lhe lnLerpreLaLlons of conLracLs, effecLs of Lhe conLracL, Lhe performance of Lhe conLracL, Lhe
deLermlnaLlon of wheLher Lhere ls breach of conLracL and Lhe valldlLy of Lhe Lerms and condlLlons of Lhe
conLracL. 1hese maLLers perLaln Lo Lhe lnLrlnslc valldlLy of Lhe conLracL and Lherefore governed by lex
conLracLus. WhaL ls Lhe lex conLracLus-how do we deLermlne lex conLracLus or Lhe law of Lhe conLracL?
SC sald ln Lhls case, lex conLracLus ls deLermlned by flrsL, Lhe law expressly agreed upon by Lhe parLles or
Lhe so called lex volunLaLls. ln Lhe absence of law expressly agreed upon by Lhe parLles, or Lhe absence
of Lhe so called cholce of law clause, lex conLracLus ls deLermlned by Lhe law lnLended by Lhe parLles
wheLher express or lmplled oLherwlse known as lex lnLenLlonls. ln deLermlnlng lex lnLenLlonls, because
Lhere ls no cholce of law clause, ln deLermlnlng Lhe law expressly or lmplledly agreed upon by Lhe
parLles, courLs are supposed Lo apply Lhe sLaLe of Lhe mosL slgnlflcanL relaLlonshlp prlnclple. under Lhls
prlnclple, Lhe law of Lhe sLaLe whlch bears Lhe mosL slgnlflcanL relaLlonshlp Lo Lhe LransacLlons and Lo
Lhe parLles Lo Lhe conLracL. Pow wlll Lhls play ouL ln connecLlon wlLh Lhe lssue ln Lhls case? lL was argued
and Lhls was susLalned by Lhe SC LhaL ln Lhls case, Lhe sLaLe of Lhe mosL slgnlflcanL relaLlonshlp ls lraq.
Why, because one of Lhe parLles ls Lhe lraql governmenL and Lhe conLracL was performed ln lraq
because Lhe pro[ecL was consLrucLed ln lraq. So Lhe lex conLracLus ln so far as Lhe conLracL beLween Lhe
parLles ls Lhe law of lraq. Powever, slnce Lhere was fallure Lo prove Lhe perLlnenL law exlsLlng ln ln lraq,
ln relaLlon Lo Lhe lssue of WCn Lhere was delay or Lhere was breach of conLracL commlLLed by Lhe
conLracLors Lhe SC proceeded Lo apply Lhe prlnclple of processual presumpLlon. And Lherefore Lhe SC
proceeded Lo apply our own lnLernal law on delay. Speclflcally Lhe SC applled arLlcle 1169 of Lhe Clvll
Code whlch says LhaL ln reclprocal obllgaLlons, nelLher parLy lncurs delay lf Lhe oLher parLy does noL or ls
noL wllllng Lo comply wlLh whaL ls lncumbenL upon hlm under Lhe conLracL. ln Lhls case, lL was obvlous
LhaL Lhe lraql governmenL dld noL comply wlLh lLs own obllgaLlon Lo pay a porLlon of Lhe bllllng ln
dollars. And Lherefore Lhe conLracLors cannoL be faulLed for noL compleLlng Lhe pro[ecL on Llme. ln oLher
words, Lhe SC found LhaL Lhe conLracLors were noL gullLy of delay ln Lhe compleLlon of Lhe pro[ecL. 1hls ls
how Lhe SC applled Lhe lex conLracLus ln relaLlon Lo a confllcL of law case lnvolvlng conLracL.
!"#$%&'( "$ *+,- .&/(012 3456

&%

l would llke you however Lo be careful wlLh Lwo cases declded by Lhe SC and parL of Lhe cases l asslgned
Lo you when Lhe SC obvlously made a mlsLake ln applylng Lhe confllcL of laws rule on conLracLs ln
connecLlon or ln so far as lnLrlnslc valldlLy ls concerned. l am referrlng Lo Lhe case of

CL Shlpplng vs. nL8C and SLeve 8ussel

1hls lnvolves a llllplno seaman, employed by a !apanese prlnclpal. Whlle on board and whlle performlng
hls funcLlon as a crew of Lhe vessel, he sllpped. As a resulL of Lhe accldenL he suffered and ln[ury ln hls
ankle whlch caused hlm so much paln. uesplLe hls requesL for medlcal aLLenLlon, Lhe capLaln of Lhe
vessel denled. And so Mr. 8ussel [umped of Lhe vessel and uslng a llfevesL swam Lo shore Lo seek
medlcal help. LvenLually he was LermlnaLed. When he reLurned Lo Lhe hlllpplnes, he wasLed no Llme ln
flllng an acLlon for lllegal dlsmlssal and paymenL of moneLary beneflLs. 1he dlsmlssal of Mr. 8ussel, lL was
esLabllshed, was effecLed wlLhouL complylng wlLh Lhe Lwln requlremenL of noLlce and hearlng. So Lhe
dlsmlssal was assalled among oLhers on Lhe ground of vlolaLlon of due process. 8uL Lhe prlnclpal, Lhe
respondenL, argued LhaL slnce Lhe law appllcable LhaL governs Lhe conLracL ls noL hlllpplnes because
Lhe conLracL ls governed by !apanese law, where under Lhe law, dlsmlssal of an employee does noL
requlre compllance wlLh noLlce and hearlng. And Lherefore, Lhe absence of noLlce and hearlng ln Lhls
case of Mr. 8ussel does noL render Lhe dlsmlssal lllegal. So respondenL was ln effecL saylng LhaL under
!apanese law, lL ls noL requlred LhaL before an employee may be LermlnaLed, Lwln requlremenLs of
noLlce and hearlng should be complled wlLh. So Lhe lssue Lhere was WCn Lhe dlsmlssal of Mr. 8ussel ln
so far as Lhe lssue of WCn compllance wlLh Lhe Lwln requlremenLs of noLlce and hearlng ls requlred ls Lo
be deLermlned by Lhe !apanese law or hlllpplne law. Pow dld Lhe SC resolve Lhls lssue? SC sald ln so far
as conLracLs are concerned, Lhe governlng law ls lex conLracLus. 1ake noLe, Lhe SC sald confllcL laws rule
on conLracL ls lex conLracLus. CorrecL! 8uL lL wenL on Lo say LhaL Lhe lex conLracLus refers Lo Lhe law of
Lhe place where Lhe conLracL ls execuLed. Whlle Lhe SC made menLlon of lex conLracLus, lL equaLed lex
conLracLus wlLh lex locl celebraLlonls. Lex locl celebraLlonls would have been correcL lf whaL was aL lssue
ls exLrlnslc because under arLlcle 17, forms and solemnlLles of conLracLs are goverened by Lhe law of Lhe
place where Lhe conLracL was execuLed. 8uL when Lhe lssue ls Lhe lnLrlnslc aspecL of Lhe conLracL, llke
Lhe naLure of Lhe conLracL, Lhe obllgaLlons and Lhe rlghLs of Lhe parLles under Lhe conLracL, Lhe Lerms
and condlLlons of Lhe conLracL, Lhe deLermlnaLlon wheLher Lhere was breach of conLracL or Lhe effecLs of
Lhe conLracL, Lhe performance of Lhe conLracL, Lhese are maLLers perLalnlng Lo lnLrlnslc and Lherefore
noL governed by lex locl celebraLlonls. Lex conLracLus governs Lhe lnLrlnslc aspecL. So ln mlsapplylng, ln
referrlng Lo lex conLracLus as Lhe law of Lhe place where Lhe conLracL was execuLed, Lhe SC proceeded Lo
conclude LhaL Lhe conLracL beLween 8ussel and Lhe employer was execuLed ln Lhe hlllpplnes. ln facL,
Lhls conLracL was approved by Lhe CLA. And Lherefore, Lhe deLermlnaLlon of WCn 8ussel was lllegally
LermlnaLed for lack of compllance wlLh Lhe requlremenL of noLlce and hearlng should be governed by
hlllpplne laws. under Lhe hlllpplne law, one of Lhe requlremenLs for a valld LermlnaLlon of
employmenL ls compllance wlLh noLlce and Pearlng. Cbvlously Lhe SC was ln error. lL confused exLrlnslc
and lnLrlnslc valldlLy of Lhe conLracL. So be careful wlLh LhaL case.

noL only dld Lhe SC apparenLly made a mlsLake ln Lhe case of CL Shlpplng hlllpplnes vs. SLeve 8ussel, lL
also commlLLed a slmllar mlsLake ln Lhe case of

!"#$%&'( "$ *+,- .&/(012 3456

&&

unlLed Alrllnes vs. CA.

1hls lnvolves a conLracL of carrlage beLween an alrllne and alrllne passengers. 1he passengers Lhere,
lonLanllla and hls famlly boughL plane LlckeLs from Lhe alrllne LlckeLlng agency ln Lhe hlllpplnes for Lhelr
Lrlp from Lhe hlllpplnes Lo Lhe uS. ln one of Lhe legs of Lhe [ourney, when Lhe lonLanlllas were abouL Lo
board Lhe alrcrafL, Lhey were bumped off allegedly ln favor of a whlLe man. And so Lhe lonLanlllas flled
an acLlon for breach of conLracL ln Lhe hlllpplnes alleglng LhaL Lhere was bad falLh on Lhe parL of Lhe
alrllne Lo deny Lhem boardlng even lf Lhey already checked ln and Lhey have conflrmed LlckeLs. 1he
alrllne lnLerposed Lhe defense LhaL whlle Lhe LlckeLs were conflrmed, buL Lhe LlckeLs were sLlll sub[ecL Lo
furLher reconflrmaLlon and check ln. So when Lhe maLLer reached Lhe courL, Lhere was a flndlng LhaL. l
Lhlnk Lhe 81C ruled ln Lhelr favor ln LhaL Lhe acL of Lhe alrllne ln overbooklng amounLs Lo bad falLh for
whlch Lhe lonLanlllas are enLlLled Lo damages. Cn appeal, Lhe CA reversed, lL reversed Lhe declslon of
Lhe 81C and [ALLy was noL really sure where Lhe lonLanlllas won wheLher lL was Lhe 81C or Lhe CA]. 8uL
anyway. 1here was a flndlng ln Lhe lower courL LhaL Lhere was bad falLh on Lhe parL of Lhe alrllne for
overbooklng and Lhe oLher courL ruled LhaL Lhe mere facL LhaL Lhe alrllne overbooked passengers does
noL necessarlly resulL ln bad falLh whlch does noL resulL ln Lhe enLlLlemenL of compensaLlon. A passenger
denled boardlng by an alrllne because of overbooklng ls only enLlLled Lo compensaLlon lf Lhe passenger
has complled wlLh Lhe checklng and reconflrmaLlon requlremenLs. So lL ls noL enough Lo prove LhaL
Lhere was over booklng. lL ls equally lmporLanL Lo prove LhaL Lhe passenger has complled wlLh Lhe
requlremenLs before boardlng. So pre-boardlng requlremenLs. 1he courL of Appeals (Slr Lhlnks) ln
resolvlng Lhe appeal lnvoked a uS law on Lhe maLLer whlch says LhaL a passenger denled boardlng may
only be enLlLled Lo compensaLlon lf Lhe passenger has complled wlLh Lhe pre-boardlng requlremenLs
such as Lhe check ln and Lhe reconflrmaLlon. 8uL ln lLs facLual flndlng, Lhe CA (Slr Lhlnks) found LhaL Lhere
was compllance wlLh Lhe requlremenL. So Lhere was compllance wlLh Lhe pre-boardlng requlremenLs
and Lherefore Lhey are enLlLled Lo compensaLlon. ln comlng up wlLh Lhls rullng, Lhe CA lnvoked Lhe uS
law on Lhe maLLer. now, when Lhe maLLer reached all Lhe way Lo Lhe SC, Lhe SC sald LhaL lL was error on
Lhe parL of Lhe CA Lo apply Lhe uS law. 8ecause Lhe SC sald LhaL Lhe lssue should be governed by
hlllpplne law. Why? 1he SC ruled LhaL conLracLs are governed by lex conLracLus, whlch means Lhe law
of Lhe place where Lhe conLracL was made and enLered lnLo. ln Lhls case, Lhe LlckeL whlch serves as a
conLracL beLween Lhe alrllne and Lhe passengers, was purchased ln Lhe hlllpplnes, and Lhe passengers
are resldenLs of Lhe hlllpplnes, and Lhe case was flled before Lhe hlllpplne courL. So agaln, llke ln CL
Shlpplng, Lhe SC obvlously referred lex conLracLus Lo Lhe law of Lhe place where Lhe conLracL was
enLered lnLo. Cr lL equaLed erroneously lex conLracLus Lo lex locl celebraLlonls. So Lake noLe of Lhls Lwo
cases.

l Lhlnk Lhe rullng ln Lhe case of hll CuaranLy ls more conslsLenL wlLh llLeraLure on Lhe maLLer. We
dlsLlngulsh Lhe Lwo dlfferenL laws LhaL govern exLrlnslc and lnLrlnslc. Lex locl celebraLlonls or Lhe law of
Lhe place where Lhe conLracL was enLered lnLo governs only Lhe exLrlnslc aspecL of Lhe conLracL. 8uL lex
conLracLus governs Lhe lnLrlnslc aspecL. 1hls should be clear by now.

now, ln so far as lex locl celebraLlonls ls concerned, whlch ls Lhe confllcL of laws rule governlng exLrlnslc
valldlLy of Lhe conLracL, Lake noLe LhaL lf Lhe place of Lhe execuLlon can be deLermlned as referrlng Lo
one sLaLe only, because all Lhe componenLs of Lhe conLracL Look place ln one sLaLe only, Lhen Lhere ls no
dlfflculLy ln deLermlnlng lex locl celebraLlonls. 1he offer, Lhe accepLance of Lhe conLracL Look place ln
!"#$%&'( "$ *+,- .&/(012 3456

&'

one counLry, Lhen ln so far as Lhe forms and solemnlLles, we apply Lhe lex locl celebraLlonls, Lhe law of
Lhe counLry. A dlfflculLy may arlse lf Lhe varlous componenLs of Lhe conLracL Look place ln varlous sLaLes
llke Lhe offer ls made ln one counLry and Lhe accepLance ls made ln anoLher counLry. Pow do we
deLermlne now Lhe lex locl celebraLlonls or Lhe law of Lhe place where Lhe conLracL was enLered lnLo?

ConLracL, as deflned by our clvll code, ls Lhe meeLlng of Lhe mlnds beLween Lhe conLracLlng parLles. And
Lhere ls meeLlng of Lhe mlnds of Lhe conLracLlng parLles lf Lhe offer ls accepLed and Lhe accepLance ls
made known Lo Lhe offeror. So ln case Lhe offer ls accepLed, and Lherefore Lhe conLracL ls
consummaLed, Lhe offer was made ln one sLaLe and accepLed ln anoLher sLaLe, and Lhe accepLance ls
communlcaLed Lo Lhe offeror, whaL ls Lhe place of Lhe execuLlon of Lhe conLracL for purposes of lex locl
celebraLlonls? under arLlcle 1319 of Lhe clvll code, lL says Lhere lf Lhe accepLance of Lhe offer ls made
Lhrough leLLers or Lelegram, Lhe accepLance shall noL blnd Lhe offeror unless Lhe accepLance ls
communlcaLed Lo Lhe offeror. ln whlch case, Lhe conLracL shall be deemed consummaLed or shall be
deemed execuLed aL Lhe place where Lhe offer was made. So Lhe counLry where Lhe offer was made ls
deemed Lo be Lhe lex locl celebraLlonls. 1hls ls because lL was when Lhe accepLance ls made
communlcaLlon or ls communlcaLed Lo Lhe offeror or lL ls when Lhe offeror learns of Lhe accepLance LhaL
Lhe conLracL was deemed perfecLed. lor purposes of lex locl celebraLlonls, you apply Lhe law of Lhe place
or Lhe counLry where Lhe offer was made.

1ake noLe also LhaL for purposes of Lhe cholce of law clause, and l'm referrlng Lo Lhe lex volunLaLls
prlnclple, as Lhe law of Lhe conLracL, Lake noLe LhaL whlle Lhe parLles may freely esLabllsh such clause ln
Lhe sLlpulaLlon as Lo whlch law Lo apply or Lo govern Lhe conLracL, Lhls ls only valld provlded Lhe law
agreed upon by Lhe parLles has raLlonal connecLlon Lo Lhe parLles and Lo Lhe LransacLlon. lf Lhe law
chosen by Lhe parLles as expressed ln Lhe cholce of law clause, has no raLlonal connecLlon Lo Lhe
LransacLlon and Lo Lhe parLles, LhaL law agreed upon by Lhe parLles may noL be valldly enforced. WhaL
happens here ls lf Lhere ls an lnvalld cholce of law clause, Lhe courL should proceed Lo deLermlne Lhe lex
lnLenLlonls or Lhe law lnLended by Lhe parLles wheLher expressly or lmplledly.

1haL compleLes Lhe mldLerm lecLure.

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