Digested by: Jr Abul Subject: Insurance Law Title: Avon Insurance vs CA Topic: Reinsurance (sections 95-98) FACTS: - It all

started with Yupangco Cotton Mills engaged to secure with Worldwide Security and Insurance Co. Inc., several of its properties totaling P200 Million - These contracts were covered by reinsurance treaties between Worldwide Surety and Insurance, and several foreign reinsurance companies including the petitioners through CJ Boatrwright acting as agent of Worldwide Surety and Insurance - A Fire then razed the properties insured on December 1969 and May 2, 1981 - A Deed of Assignment made by Worldwide Surety and Insurance acknowledged a remaining balance of P19,444,447.75 still due and assigned to Yupangco all reinsurance proceeds still collectible from all the foreign reinsurance companies. - Yupangco then filed a collection suit on the above petitioners - The service of summons were made through the office of the Insurance Commissioner but since the international reinsurers question the jurisdiction the trial court the case has not proceeded to trial on the merits - The reinsurer is questioning also the service of summons through extraterritorial service under Sect 17 Rule 14 of the Rules of Court nor through the Insurance Commissioner under Sec 14 - Yupangco also contends that since the reinsurers question the jurisdiction of the court they are deemed to have submitted to the jurisdiction of the court. ISSUE: WON the international reinsurers are doing business in the Philippines. - WON the Philippine court has jurisdiction over these international reinsurers who are not doing business in the Philippines RULING: NO, international reinsurers are not doing business in the Philippines and the Philippine court has not acquired jurisdiction over them. - The reinsurance treaties between the petitioners and Worldwide Surety and Insurance were made through an international insurance broker and NOT through any entity or means remotely connected with the Philippines - Reinsurance company is not doing business in a certain state even if the property or lives which are insured by the original insurer company are located in that state. - Reinsurance Contract is generally separate and distinct arrangement from the original contract of insurance. - Doing business in the Philippines must be judged in the light of its peculiar circumstances upon its peculiar facts and upon the language of the statute applicable.

True test: whether the foreign corporation is continuing the body or substance of the business or enterprise for which it was organized If there exist a domestic agent of the foreign corporation it can be served with summons through that agent without proving that such corporation is doing business in the phils or not. o NO allegation or demonstration of the existence of petitioners domestic agent but avers simply that they are doing business not only abroad but in the Phils o Petitioners had not performed any act which would give the general public the impression that it had been engaging or intends to engage in its ordinary and usual business undertaking in the country. The purpose of the law in requiring that foreign corporations doing business in the country be licensed to do so, is to subject the foreign corporations doing business in the Philippines to the jurisdiction of the courts, 19 otherwise, a foreign corporation illegally doing business here because of its refusal or neglect to obtain the required license and authority to do business may successfully though unfairly plead such neglect or illegal act so as to avoid service and thereby impugn the jurisdiction of the local courts. Voluntary appearance before the lower court to question the jurisdiction is not equivalent to submission to jurisdiction o

The SC disposed the case in favor of the international insurers (petitioners) declaring that the lower court has not acquired and cannot acquire jurisdiction over them and was ordered to desist from maintaining further proceeding against them.