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Conflict of Laws Case Digest: HASEGAWA vs KITAMURA 538 SCRA 26 (2007)


KAZUHIRO HASEGAWA and NIPPON ENGINEERING CONSULTANTS CO., LTD.,
vs
MINORU KITAMURA
G.R. No. 149177
November 23, 2007
FACTS:
Nippon Engineering Consultants (Nippon), a Japanese consultancy firm providing technical and management
support in the infrastructure projects national permanently residing in the Philippines. The agreement
provides that Kitamaru was to extend professional services to Nippon for a year. Nippon assigned Kitamaru
to work as the project manager of the Southern Tagalog Access Road (STAR) project. When the STAR
project was near completion, DPWH engaged the consultancy services of Nippon, this time for the detailed
engineering & construction supervision of the Bongabon-Baler Road Improvement (BBRI) Project. Kitamaru
was named as the project manger in the contract.
Hasegawa, Nippons general manager for its International Division, informed Kitamaru that the company had
no more intention of automatically renewing his ICA. His services would be engaged by the company only
up to the substantial completion of the STAR Project.
Kitamaru demanded that he be assigned to the BBRI project. Nippon insisted that Kitamarus contract was
for a fixed term that had expired. Kitamaru then filed for specific performance & damages w/ the RTC of
Lipa City. Nippon filed a MTD.
Nippons contention: The ICA had been perfected in Japan & executed by & between Japanese nationals.
Thus, the RTC of Lipa City has no jurisdiction. The claim for improper pre-termination of Kitamarus ICA
could only be heard & ventilated in the proper courts of Japan following the principles of lex loci
celebrationis & lex contractus.
The RTC denied the motion to dismiss. The CA ruled hat the principle of lex loci celebrationis was not
applicable to the case, because nowhere in the pleadings was the validity of the written agreement put in
issue. It held that the RTC was correct in applying the principle of lex loci solutionis.
ISSUE:
Whether or not the subject matter jurisdiction of Philippine courts in civil cases for specific performance &
damages involving contracts executed outside the country by foreign nationals may be assailed on the
principles of lex loci celebrationis, lex contractus, the state of the most significant relationship rule, or
forum non conveniens.
HELD:
NO. In the judicial resolution of conflicts problems, 3 consecutive phases are involved: jurisdiction, choice of
law, and recognition and enforcement of judgments. Jurisdiction & choice of law are 2 distinct
concepts.Jurisdiction considers whether it is fair to cause a defendant to travel to this state; choice of law asks
the further question whether the application of a substantive law w/c will determine the merits of the case is
fair to both parties. The power to exercise jurisdiction does not automatically give a state constitutional
authority to apply forum law. While jurisdiction and the choice of the lex foriwill often coincide, the
minimum contacts for one do not always provide the necessary significant contacts for the other. The
question of whether the law of a state can be applied to a transaction is different from the question of whether
the courts of that state have jurisdiction to enter a judgment.
In this case, only the 1st phase is at issuejurisdiction. Jurisdiction, however, has various aspects. For a court
to validly exercise its power to adjudicate a controversy, it must have jurisdiction over the plaintiff/petitioner,
over the defendant/respondent, over the subject matter, over the issues of the case and, in cases involving

property, over the res or the thing w/c is the subject of the litigation.In assailing the trial court's jurisdiction
herein, Nippon is actually referring to subject matter jurisdiction.
Jurisdiction over the subject matter in a judicial proceeding is conferred by the sovereign authority w/c
establishes and organizes the court. It is given only by law and in the manner prescribed by law. It is further
determined by the allegations of the complaint irrespective of whether the plaintiff is entitled to all or some of
the claims asserted therein. To succeed in its motion for the dismissal of an action for lack of jurisdiction over
the subject matter of the claim, the movant must show that the court or tribunal cannot act on the matter
submitted to it because no law grants it the power to adjudicate the claims.
In the instant case, Nippon, in its MTD, does not claim that the RTC is not properly vested by law w/
jurisdiction to hear the subject controversy for a civil case for specific performance & damages is one not
capable of pecuniary estimation & is properly cognizable by the RTC of Lipa City.What they rather raise as
grounds to question subject matter jurisdiction are the principles of lex loci celebrationis and lex
contractus, and the state of the most significant relationship rule. The Court finds the invocation of these
grounds unsound.
Lex loci celebrationis relates to the law of the place of the ceremony or the law of the place where a
contract is made. The doctrine of lex contractus or lex loci contractusmeans the law of the place where a
contract is executed or to be performed. It controls the nature, construction, and validity of the contract and
it may pertain to the law voluntarily agreed upon by the parties or the law intended by them either expressly
or implicitly. Under the state of the most significant relationship rule, to ascertain what state law to apply to
a dispute, the court should determine which state has the most substantial connection to the occurrence and
the parties. In a case involving a contract, the court should consider where the contract was made, was
negotiated, was to be performed, and the domicile, place of business, or place of incorporation of the
parties.This rule takes into account several contacts and evaluates them according to their relative importance
with respect to the particular issue to be resolved.
Since these 3 principles in conflict of laws make reference to the law applicable to a dispute, they are rules
proper for the 2nd phase, the choice of law. They determine which state's law is to be applied in resolving the
substantive issues of a conflicts problem. Necessarily, as the only issue in this case is that of jurisdiction,
choice-of-law rules are not only inapplicable but also not yet called for.
Further, Nippons premature invocation of choice-of-law rules is exposed by the fact that they have not yet
pointed out any conflict between the laws of Japan and ours. Before determining which law should apply,
1st there should exist a conflict of laws situation requiring the application of the conflict of laws rules. Also,
when the law of a foreign country is invoked to provide the proper rules for the solution of a case, the
existence of such law must be pleaded and proved.
It should be noted that when a conflicts case, one involving a foreign element, is brought before a court or
administrative agency, there are 3 alternatives open to the latter in disposing of it: (1) dismiss the case, either
because of lack of jurisdiction or refusal to assume jurisdiction over the case; (2) assume jurisdiction over the
case and apply the internal law of the forum; or (3) assume jurisdiction over the case and take into account or
apply the law of some other State or States. The courts power to hear cases and controversies is derived from
the Constitution and the laws. While it may choose to recognize laws of foreign nations, the court is not
limited by foreign sovereign law short of treaties or other formal agreements, even in matters regarding rights
provided by foreign sovereigns.
Neither can the other ground raised, forum non conveniens, be used to deprive the RTC of its jurisdiction. 1st,
it is not a proper basis for a motion to dismiss because Sec. 1, Rule 16 of the Rules of Court does not include

it as a ground. 2nd, whether a suit should be entertained or dismissed on the basis of the said doctrine
depends largely upon the facts of the particular case and is addressed to the sound discretion of the RTC. In
this case, the RTC decided to assume jurisdiction. 3rd, the propriety of dismissing a case based on this
principle requires a factual determination; hence, this conflicts principle is more properly considered a matter
of defense.
SECOND DIVISION
FORT BONIFACIO DEVELOPMENT
CORPORATION,
Petitioner,

G.R. No. 176709


Present:

- versus -

HON. EDWIN D. SORONGON


and VALENTIN FONG,
Respondents.

CARPIO MORALES,* JJ.


Acting Chairperson,
TINGA,
VELASCO, JR.,
LEONARDO DE CASTRO,**and
BRION, JJ.
Promulgated:
May 8, 2009

x------------------------------------------------x
DECISION
TINGA, J.:

Petitioner Fort Bonifacio Development Corporation (petitioner), a corporation registered under


Philippine laws, is engaged in the business of real estate development. Respondent, Valentin Fong
(respondent) doing business under the name VF Industrial Sales is the assignee of L & M Maxco Specialist
Constructions (Maxco) retention money from the Bonifacio Ridge Condominium Phase 1 (BRCP 1).
In this Petition for Review,[1] petitioner assails the Decision[2] of the Court of Appeals dated November
30, 2006 which ruled that it is the regional trial court and not the Construction Industry Arbitration
Commission (CIAC) that has jurisdiction over respondents claim.
The facts are as follows:

On July 2000, Petitioner entered into a trade contract with Maxco wherein Maxco would undertake
the structural and partial architectural package of the BRCP 1. Later petitioner accused Maxco of delay in
completion of its work and on August 24, 2004 sent the latter a notice of termination. Petitioner also
instructed Maxco to perform remedial measures prior to the contract expiration pursuant to Clause 23.1 of the
contract.
Subsequently, Maxco was sued by its creditors including respondent for debts unrelated to BRCP 1. In
order to settle the collection suit, on February 28, 2005, Maxco assigned its receivables representing its
retention money from the BRCP 1 in the amount of one million five hundred seventy seven thousand one
hundred fifteen pesos and ninety centavos (P1,577,115.90). On April 18, 2005, respondent wrote to
petitioner, informing the latter of Maxcos assignment in his favor and asking the latter to confirm the validity

of Maxcos receivables.[3] Petitioner replied, informing the respondent that Maxco did have receivables,
however these were not due and demandable until January of next year, moreover the amount had to be
ascertained and liquidated.
A subsequent exchange of correspondence failed to settle the matter. Specifically, on January 31,
2006,[4] petitioner through counsel, wrote to respondent informing the latter that there is no more amount due
to Maxco from petitioner after the rectification of defect as well as the satisfaction of notices of garnishment
dated July 30, 2004[5] andJanuary 26, 2006.[6] On February 13, 2006, respondent filed a complaint for a sum
of money against petitioner and Maxco in the Regional Trial Court of Mandaluyong City.[7]Respondent
claimed that there were sufficient residual amounts to pay the receivables of Maxco at the time he served
notice of the assignment. The subsequent notices of garnishment should not adversely affect the receivables
assigned to him. The retention money was over due in January 2006 and despite demand, petitioner did not
pay the amount subject of the deed of assignment. Petitioner however, paid out the retention money to other
garnishing creditors of Maxco to the detriment of respondent.

On March 16, 2006, instead of filing an Answer, petitioner filed a Motion to Dismiss on the ground of
lack of jurisdiction over the subject matter.[8] Petitioner argued that since respondent merely stepped into the
shoes of Maxco as its assignee, it was the CIAC and not the regular courts that had jurisdiction over the
dispute as provided in the Trade Contract. Judge Edwin Sorongon issued an Order dated June 27,
2006 denying the motion to dismiss.[9] Petitioner moved for reconsideration but this was denied in an Order
dated August 15, 2006.
On October 16, 2006, petitioner filed a petition for certiorari and prohibition with the Court of
Appeals. On November 30, 2006, the Court of Appeals denied the petition for lack of merit. The dispositive
portion reads:
WHEREFORE, premises considered, the present petition is hereby DENIED DUE
COURSE and accordingly DISMISSED for lack of merit. The assailed Orders dated June 27,
2006 and August 15, 2006 of respondent Judge in Civil Case No. MC-06-2928 are hereby
AFFIRMED.
With costs against the petitioner.
SO ORDERED.[10]

The appellate court held that it was the trial court and not the Construction Industry Arbitration
Commission (CIAC) that had jurisdiction over the claims of Valentin Fong. The claim could not be construed
as related to the construction industry as it is for enforcement of Maxcos deed of assignment over its
retention money.
Petitioner moved for reconsideration on December 22, 2006 but this was denied by the appellate court
in a resolution dated February 29, 2006.
Hence, the present petition for review on certiorari. Petitioners sets forth four (4) errors committed by
the appellate court namely: (1) the original and exclusive jurisdiction over respondents complaint is vested
with the CIAC; (2) Respondents complaint failed to state a cause of action; (3) the claim of respondent has
already been extinguished; and (4) the conditions precedent for the complaint have not been complied with.
The petition lacks merit.

In reference to the first error, Section 4 of Executive Order No. 1008, Series of 1985 (E.O. No.
1008) sets forth the jurisdiction of CIAC. To wit:
SECTION 4. Jurisdiction.The CIAC shall have original and exclusive jurisdiction
over disputes arising from, or connected with, contracts entered into by parties involved in
construction in the Philippines, whether the dispute arises before or after the completion of the
contract, or after the abandonment or breach thereof. These disputes may involve government
or private contracts. For the Board to acquire jurisdiction, the parties to a dispute must agree to
submit the same to voluntary arbitration.
The jurisdiction of the CIAC may include but is not limited to violation of
specifications for materials and workmanship; violation of the terms of agreement;
interpretation and/or application of contractual provisions; maintenance and defects; payment
default of employer or contractor and changes in contract cost.
Excluded from the coverage of this law are disputes arising from employer-employee
relationships which shall continue to be covered by the Labor Code of the Philippines.

Jurisdiction is defined as the authority to try, hear and decide a case. [11] Moreover, that jurisdiction of
the court over the subject matter is determined by the allegations of the complaint without regard to whether
or not the plaintiff is entitled to recover upon all or some of the claims asserted therein is a well entrenched
principle.[12] In this regard, the jurisdiction of the court does not depend upon the defenses pleaded in the
answer or in the motion to dismiss, lest the question of jurisdiction would almost entirely depend upon the
defendant.[13]
An examination of the allegations in Fongs complaint reveals that his cause of action springs not
from a violation of the provisions of the Trade Contract, but from the assignment of Maxcos retention money
to him and failure of petitioner to turn over the retention money. The allegations in Fongs Complaint are
clear and simple: (1) That Maxco had an outstanding obligation to respondent; (2) Maxco assigned to Fong
its retention from petitioner in payment of the said obligation,; (3) Petitioner as early as April 18, 2005 was
notified of the assignment; (4) Despite due notice of such assignment, petitioner still refused to deliver the
amount assigned to respondent, giving preference, instead, to the 2 other creditors of Maxco; (5) At the time
petitioner was notified of the assignment, there were only one other notice of garnishment and there were
sufficient residual amounts to satisfy Fongs claim; and (6) uncertain over which one between Maxco and
petitioner he may resort to for payment, respondent named them both as defendants in Civil Case No. 060200-CFM.
While it is true that respondent, as the assignee of the receivables of Maxco from petitioner under the
Trade Contract, merely stepped into the shoes of Maxco. However, the right of Maxco to the retention
money from petitioner under the trade contract is not even in dispute in Civil Case No. 06-0200-CFM.
Respondent raises as an issue before the RTC is the petitioners alleged unjustified preference to the claims of
the other creditors of Maxco over the retention money.
Although the jurisdiction of the CIAC is not limited to the instances enumerated in Section 4 of E. O.
No. 1008, Fongs claim is not even construction-related at all. This court has held that: Construction is
defined as referring to all on-site works on buildings or altering structures, from land clearance through
completion including excavation, erection and assembly and installation of components and equipment. [14]
Thus, petitioners insistence on the application of the arbitration clause of the Trade Contract to Fong is

clearly anchored on an erroneous premise that the latter is seeking to enforce a right under the trade contract.
This premise cannot stand since the right to the retention money of Maxco under the Trade Contract is not
being impugned herein. It bears mentioning that petitioner readily conceded the existence of the retention
money. Fongs demand that the portion of retention money should have been paid to him before the other
creditors of Maxco clearly, does not require the CIACs expertise and technical knowledge of construction.
The adjudication of Civil Case necessarily involves the application of pertinent statutes and
jurisprudence to matters of assignment and preference of credits. As this Court held in Fort Bonifacio
Development Corporation v. Domingo,[15] this task more suited for a trial court to carry out after a full-blown
trial, than an arbitration body specifically devoted to construction contracts.
The second error raised also has not merit. Failure to state a cause of action refers to the insufficiency
of allegation in the pleading. In resolving a motion to dismiss based on the failure to state a cause of action
only the facts alleged in the complaint must be considered. The test is whether the court can render a valid
judgment on the complaint based on the facts alleged and the prayer asked for.
In this case the complaint alleges that:
x x x at the time he served notice of assignment to defendant FBDC there was only
one notice of garnishment that the latter had received and there were still sufficient residual
amounts to pay that assigned by defendant Maxco to the plaintiff. Subsequent notices of
garnishment received by defendant FBDC could not adversely affect the amounts already
assigned to the plaintiff as they are already his property, no longer that of defendant Maxco.[16]
From this statement alone, it is clear that a cause of action is present in the complaint filed a quo.
Respondent has specifically alleged that the undue preference given to other creditors of Maxco over the
retention money by petitioner was to the prejudice of his rights.
Petitioner next asserts that the appellate court erred in not ruling that the claim of respondent was
extinguished by payment to the other garnishing creditors of Maxco. The assignment of this as an error is
misleading as this is precisely one of the issues that need to be resolved in a full blown trial and one of the
reasons that respondent impleaded Maxco and petitioner in the alternative.
The final error raised by petitioner that the other judgment creditors [17] as well as the trial court that
issued the writ of garnishment and CIAC should have been impleaded as defendants in the case as they were
indispensable parties is likewise weak. Section 7, Rule 3 of the Revised Rules of Court provides for the
compulsory joinder of indispensable parties without whom no final determination can be had of an
action. An indispensable party is defined as one who has such an interest in the controversy or subject matter
that a final adjudication cannot be made, in his absence, without injuring or affecting that interest. [18] The
other judgment creditors are entitled to the fruits of the final judgments rendered in their favor. Their rights
are distinct from the rights acquired by the respondent over the portion of the retention money assigned to the
latter by Maxco. Their interests are in no way affected by any judgment to be rendered in this case.
WHEREFORE, premises considered, the instant Petition is DENIED. The Decision dated November
30, 2006 and the Resolution dated February 19, 2007 of the Court of Appeals in CA-G.R. SP No. 96532 are
hereby AFFIRMED.
SO ORDERED.

HSBC vs SHERMAN
G.R. No. 72494, Aug. 11, 1989

Choice-of-forum clause
Jurisdiction and Venue
Parties can stipulate as to their choice of venue. But if the stipulation is not restrictive, it
shall be treated as merely permissive and will not bar the other party from airing the case in a
different forum which has jurisdiction over thesubject matter.
FACTS:
Sometime in 1981, Eastern Book Supply PTE, Ltd. (Company), a company incorporated in
Singapore, applied with and was granted by the Singapore Branch of HSBC an overdraft
facility. To secure the overdraft facility, private respondents who were directors of the
Company executed a Joint and Several Guarantee in favour of HSBC, which provides that:
This guarantee and all rights, obligations and liabilities arising hereunder shall be
construed and determined under and may be enforced in accordance with the laws of the
Republic of Singapore. We hereby agree that the Courts of Singapore shall
have jurisdiction over all disputes arising under this guarantee.
However, when the Company failed to pay its obligation, HSBC filed this action with the
Philippine courts. In a Motion to Dismiss, the private respondents raised the abovementioned
provision of the Joint and Several Guarantee. The trial courtaffirmed the plaintiffs but CA
reversed, citing said provision as basis.
ISSUE:

Whether or not Philippine courts have jurisdiction over the suit

HELD:
The Supreme Court held that the clause in question did not operate to divest the Philippine courts
of jurisdiction.
While it is true that the transaction took place in Singaporean setting and that the Joint and Several
Guarantee contains a choice-of-forum clause, the very essence of due process dictates that the stipulation
that [t]his guarantee and all rights, obligations and liabilities arising hereunder shall be construed and
determined under and may be enforced in accordance with the laws of the Republic of Singapore. We hereby
agree that the Courts in Singapore shall havejurisdiction over all disputes arising under this guarantee be
liberally construed. One basic principle underlies all rules ofjurisdiction in International Law: a State does
not have jurisdiction in the absence of some reasonable basis for exercising it, whether the proceedings are

in rem, quasi in rem, or in personam. To be reasonable, the jurisdiction must be based on some minimum
contacts that will not offend traditional notions of fair play and substantial justice. Indeed, as pointed-out by
petitioner BANK at the outset, the instant case presents a very odd situation. In the ordinary habits of life,
anyone would be disinclined to litigate before a foreign tribunal, with more reason as a defendant. However,
in this case, private respondents are Philippine residents (a fact which was not disputed by them) who would
rather face a complaint against them before a foreign court and in the process incur considerable expenses,
not to mention inconvenience, than to have a Philippine court try and resolve the case. Private respondents'
stance is hardly comprehensible, unless their ultimate intent is to evade, or at least delay, the payment of a
just obligation.
The defense of private respondents that the complaint should have been filed in Singapore is based merely on
technicality. They did not even claim, much less prove, that the filing of the action here will cause them any
unnecessary trouble, damage, or expense. On the other hand, there is no showing that petitioner BANK filed
the action here just to harass private respondents.
The parties did not thereby stipulate that only the courts of Singapore, to the exclusion of all the rest,
has jurisdiction. Neither did the clause in question operate to divest Philippine courts of jurisdiction.
In International Law, jurisdiction is often defined as the light of a State to exercise authority over persons
and things within its boundaries subject to certain exceptions. Thus, a State does not
assume jurisdiction over travelling sovereigns, ambassadors and diplomatic representatives of other States,
and foreign military units stationed in or marching through State territory with the permission of the latter's
authorities. This authority, which finds its source in the concept of sovereignty, is exclusive within and
throughout the domain of the State. A State is competent to take hold of any judicial matter it sees fit by
making its courts and agencies assume jurisdiction over all kinds of cases brought before them.

Reagan vs Commissioner of Internal Revenue


on November 9, 2011
Political Law Sovereignty
Reagan is a US citizen assigned at Clark Air Base to help provide technical assistance to the US Air Force. In
April 1960 Reagan imported a 1960 Cadillac car valued at $6443.83. Two months later, he got permission to
sell the same car provided that he would sell the car to a US citizen or a member of the USAF. He sold it to
Willie Johnson Jr for $6600.00 as shown by a Bill of Sale. The sale took place within Clark Air Base. As a
result of this transaction, the Commissioner of Internal Revenue calculated the net taxable income of Reagan
to be at P17912.34 and that his income tax would be P2797.00. Reagan paid the assessed tax but at the same
time he sought for a refund because he claims that he is exempt. Reagan claims that the sale took place in
foreign soil since Clark Air Base, in legal contemplation is a base outside the Philippines. Reagan also cited
that under the Military Bases Agreement, he, by nature of his employment, is exempt from Philippine
taxation.
ISSUE: Is the sale considered done in a foreign soil not subject to Philippine income tax?
HELD: The Philippines is independent and sovereign, its authority may be exercised over its entire domain.
There is no portion thereof that is beyond its power. Within its limits, its decrees are supreme, its commands
paramount. Its laws govern therein, and everyone to whom it applies must submit to its terms. That is the
extent of its jurisdiction, both territorial and personal. On the other hand, there is nothing in the Military
Bases Agreement that lends support to Reagans assertion. The Base has not become foreign soil or territory.
This countrys jurisdictional rights therein, certainly not excluding the power to tax, have been preserved, the

Philippines merely consents that the US exercise jurisdiction in certain cases this is just a matter of comity,
courtesy and expediency. It is likewise noted that he indeed is employed by the USAF and his income is
derived from US source but the income derived from the sale is not of US source hence taxable.

November 16, 1939


G.R. No. 46631
IDONAH SLADE PERKINS, petitioner,
vs.
ARSENIO P. DIZON, Judge of First Instance of Manila, EUGENE ARTHUR PERKINS, and BENGUET
CONSOLIDATED MINING COMPANY, respondents.
Alva J. Hill for petitioner.
Ross, Lawrence, Selph & Carrascoso for respondent Judge and Benguet Consolidated Mining Company.
DeWitt, Perkins & Ponce Enrile for respondent Perkins.
Moran, J.:
On July 6, 1938, respondent, Eugene Arthur Perkins, instituted an action in the Court of First Instance of
Manila against the Benguet Consolidated Mining Company for dividends amounting to P71,379.90 on
52,874 shares of stock registered in his name, payment of which was being withheld by the company; and,
for the recognition of his right to the control and disposal of said shares, to the exclusion of all others. To the
complaint, the company filed its answer alleging, by way of defense, that the withholding of such dividends
and the non-recognition of plaintiffs right to the disposal and control of the shares were due to certain
demands made with respect to said shares by the petitioner herein, Idonah Slade Perkins, and by one George
H. Engelhard. The answer prays that the adverse claimants be made parties to the action and served with
notice thereof by publication, and that thereafter all such parties be required to interplead and settle the rights
among themselves. On September 5, 1938, the trial court ordered respondent Eugene Arthur Perkins to
include in his complaint as parties defendant petitioner, Idonah Slade Perkins, and George H. Engelhard. The
complaint was accordingly amended and in addition to the relief prayed for in the original complaint,
respondent Perkins prayed that petitioner Idonah Slade Perkins and George Engelhard be adjudged without
interest in the shares of stock in question and excluded from any claim they assert thereon. Thereafter,
summons by publication were served upon the non-resident defendants, Idonah Slade Perkins and George H.
Engelhard, pursuant to the order of the trial court. On December 9, 1938, Engelhard filed his answer to the
amended complaint, and on December 10, 1938, petitioner Idonah Slade Perkins, through counsel, filed her
pleading entitled objection to venue, motion to quash, and demurrer to jurisdiction wherein she challenged
the jurisdiction of the lower court over her person. Petitioners objection, motion and demurrer having been
overruled as well as her motion for reconsideration of the order of denial, she now brought the present
petition for certiorari, praying that the summons by publication issued against her be declared null and void,
and that, with respect to her, respondent Judge be permanently prohibited from taking any action on the case.
The controlling issue here involved is whether or not the Court of First Instance of Manila has acquired
jurisdiction over the person of the present petitioner as a non-resident defendant, or, notwithstanding the want
of such jurisdiction, whether or not said court may validly try the case. The parties have filed lengthy
memorandums relying on numerous authorities, but the principles governing the question are well settled in
this jurisdiction.
Section 398 of our Code of Civil Procedure provides that when a non-resident defendant is sued in the
Philippine courts and it appears, by the complaint or by affidavits, that the action relates to real or personal
property within the Philippines in which said defendant has or claims a lien or interest, actual or contingent,
or in which the relief demanded consists, wholly or in part, in excluding such person from any interest
therein, service of summons maybe made by publication.

10

We have fully explained the meaning of this provision in El Banco Espaol Filipino vs. Palanca, 37 Phil.
921, wherein we laid down the following rules:
(1) In order that the court may validly try a case, it must have jurisdiction over the subject-matter and over
the persons of the parties. Jurisdiction over the subject-matter is acquired by concession of the sovereign
authority which organizes a court and determines the nature and extent of its powers in general and thus
fixes its jurisdiction with reference to actions which it may entertain and the relief it may grant. Jurisdiction
over the persons of the parties is acquired by their voluntary appearance in court and their submission to its
authority, or by the coercive power of legal process exerted over their persons.
(2) When the defendant is a non-resident and refuses to appear voluntary, the court cannot acquire
jurisdiction over his person even if the summons be served by publication, for he is beyond the reach of
judicial process. No tribunal established by one State can extend its process beyond its territory so as to
subject to its decisions either persons or property located in another State. There are many expressions in
the American reports from which it might be inferred that the court acquires personal jurisdiction over the
person of the defendant by publication and notice; but such is not the case. In truth, the proposition that
jurisdiction over the person of a non-resident cannot be acquired by publication and notice was never clearly
understood even in the American courts until after the decision had been rendered by the Supreme Court of
the United States in the leading case ofPennoyer v. Neff (95 U.S., 714; 24 Law. ed., 565). In the light of that
decisions which have subsequently been rendered in that and other courts, the proposition that jurisdiction
over the person cannot be thus acquired by publication and notice is no longer open to question; and it is
now fully established that a personal judgment upon constructive or substituted service against a nonresident who does not appear is wholly invalid. This doctrine applies to all kinds of constructive or
substituted process, including service by publication and personal service outside of the jurisdiction in which
the judgment is rendered; and the only exception seems to be found in the case where the non-resident
defendant has expressly or impliedly consented to the mode of service. (Note to Raher vs. Raher, 35 L. R. A.
[N. S.], 292; see also L.R.A. 585; 35 L.R.A. [N.S.], 312.)
(3) The general rule, therefore, is that a suit against a non-resident cannot be entertained by a Philippine
court. Where, however, the action is in rem or quasi in rem in connection with property located in the
Philippines, the court acquires jurisdiction over the res, and its jurisdiction over the person of the nonresident is non-essential. In order that the court may exercise power over the res, it is not necessary that the
court should take actual custody of the property, potential custody thereof being sufficient. There is potential
custody when, from the nature of the action brought, the power of the court over the property is impliedly
recognized by law. An illustration of what we term potential jurisdiction over the res, is found in the
proceeding to register the title of land under our system for the registration of land. Here the court, without
taking actual physical control over the property , assumes, at the instance of some person claiming to be
owner, to exercise a jurisdictionin rem over the property and to adjudicate the title in favor of the petitioner
against all the world.
(4) As before stated, in an action in rem or quasi in rem against a non-resident defendant, jurisdiction over
his person is non-essential, and if the law requires in such case that the summons upon the defendant be
served by publication, it is merely to satisfy the constitutional requirement of due process. If any be said, in
this connection, that may reported cases can be cited in which it is assumed that the question of the
sufficiency of publication or notice in the case of this kind is a question affecting the jurisdiction of the court,
and the court is sometimes said to acquire jurisdiction by virtue of the publication. This phraseology was
undoubtedly originally adopted by the court because of the analogy between service by publication and
personal service of process upon the defendant; and, as has already been suggested, prior to the decision
of Pennoyer v. Neff (supra), the difference between the legal effects of the two forms of service was obscure.
It is accordingly not surprising that the modes of expression which had already been molded into legal
tradition before that case was decided have been brought down to the present day. But it is clear that the
legal principle here involved is not affected by the peculiar languages in which the courts have expounded
their ideas.
The reason for the rule that Philippine courts cannot acquire jurisdiction over the person of a non-resident, as
laid down by the Supreme Court of the United States in Pennoyer v. Neff, supra, may be found in a
recognized principle of public law to the effect that no State can exercise direct jurisdiction and authority

11

over persons or property without its territory. Story, Confl. L., ch. 2; Wheat, Int. L., pt. 2, ch. 2. The several
States are of equal dignity and authority, and the independence of one implies the exclusion of power from all
others. And so it is laid down by jurists, as an elementary principle, that the laws of one State have no
operation outside of its territory, except so far as is allowed by comity; and that no tribunal established by it
can extend its process beyond that territory so as to subject either persons or property to its decisions. Any
exertion of authority of this sort beyond this limit, says Story, is a mere nullity, and incapable of binding
such persons or property in any other tribunals. Story, Confl. L., sec. 539. (Pennoyer v. Neff, 95 U.S., 714;
24 Law. ed., 565, 568-569.).
When, however, the action relates to property located in the Philippines, the Philippine courts may validly try
the case, upon the principle that a State, through its tribunals, may subject property situated within its limits
owned by non-residents to the payment of the demand of its own citizens against them; and the exercise of
this jurisdiction in no respect infringes upon the sovereignty of the State where the owners are domiciled.
Every State owes protection to its citizens; and, when non-residents deal with them, it is a legitimate and just
exercise of authority to hold and appropriate any property owned by such non-residents to satisfy the claims
of its citizens. It is in virtue of the States jurisdiction over the property of the non-resident situated within its
limits that its tribunals can inquire into the non-residents obligations to its own citizens, and the inquiry can
then be carried only to the extent necessary to control the disposition of the property. If the non-resident has
no property in the State, there is nothing upon which the tribunals can adjudicate. (Pennoyer v. Neff, supra.)
In the instant case, there can be no question that the action brought by Eugene Arthur Perkins in his amended
complaint against the petitioner, Idonah Slade Perkins, seeks to exclude her from any interest in a property
located in the Philippines. That property consists in certain shares of stocks of the Benguet Consolidated
Mining Company, a sociedad anonima, organized in the Philippines under the provisions of the Spanish Code
of Commerce, with its principal office in the City of Manila and which conducts its mining activities therein.
The situs of the shares is in the jurisdiction where the corporation is created, whether the certificated
evidencing the ownership of those shares are within or without that jurisdiction. (Fletcher Cyclopedia
Corporations, Permanent ed. Vol. 11, p. 95). Under these circumstances, we hold that the action thus brought
is quasi in rem, for while the judgment that may be rendered therein is not strictly a judgment in rem, it fixes
and settles the title to the property in controversy and to that extent partakes of the nature of the judgment in
rem. (50 C.J., p 503). As held by the Supreme Court of the United States in Pennoyer v. Neff (supra);
It is true that, in a strict sense, a proceeding in rem is one taken directly against property, and has for its
object the disposition of the property, without reference to the title of individual claimants; but , in a large
and more general sense, the terms are applied to actions between parties, where the direct object is to reach
and dispose of property owned by them, or of some interest therein.
The action being in quasi in rem, The Court of First Instance of Manila has jurisdiction over the person of the
non-resident. In order to satisfy the constitutional requirement of due process, summons has been served
upon her by publication. There is no question as to the adequacy of publication made nor as to the mailing of
the order of publication to the petitioners last known place of residence in the United States. But, of course,
the action being quasi in rem and notice having be made by publication, the relief that may be granted by the
Philippine court must be confined to the res, it having no jurisdiction to render a personal judgment against
the non-resident. In the amended complaint filed by Eugene Arthur Perkins, no money judgment or other
relief in personam is prayed for against the petitioner. The only relief sought therein is that she be declared to
be without any interest in the shares in controversy and that she be excluded from any claim thereto.
Petitioner contends that the proceeding instituted against her is one of interpleading and is therefore an
action in personam. Section 120 of our Code of Civil Procedure provides that whenever conflicting claims
are or may be made upon a person for or relating to personal property, or the performance of an obligation or
any portion thereof, so that he may be made subject to several actions by different persons, such person may
bring an action against the conflicting claimants, disclaiming personal interest in the controversy, and the
court may order them to interplead with one another and litigate their several claims among themselves, there
upon proceed to determine their several claims. Here, The Benguet Consolidated Mining Company, in its
answer to the complaint filed by Eugene Arthur Perkins, averred that in connection with the shares of stock in
question, conflicting claims were being made upon it by said plaintiff, Eugene Arthur Perkins, his wife
Idonah Slade Perkins, and one named George H. Engelhard, and prayed that these last two be made parties to

12

the action and served with summons by publication, so that the three claimants may litigate their conflicting
claims and settle their rights among themselves. The court has not issued an order compelling the conflicting
claimants to interplead with one another and litigate their several claims among themselves, but instead
ordered the plaintiff to amend his complaint including the other two claimants as parties defendant. The
plaintiff did so, praying that the new defendants thus joined be excluded fro any interest in the shares in
question, and it is upon this amended complaint that the court ordered the service of the summons by
publication. It is therefore, clear that the publication of the summons was ordered not in virtue of an
interpleading, but upon the filing of the amended complaint wherein an action quasi in rem is alleged.
Had not the complaint been amended, including the herein petitioner as an additional defendant, and had the
court, upon the filing of the answer of the Benguet Consolidated Mining Company, issued an order under
section 120 of the Code of Civil Procedure, calling the conflicting claimants into court and compelling them
to interplead with one another, such order could not perhaps have validly been served by publication or
otherwise, upon the non-resident Idonah Slade Perkins, for then the proceeding would be purely one of
interpleading. Such proceeding is a personal action, for it merely seeks to call conflicting claimants into court
so that they may interplead and litigate their several claims among themselves, and no specific relief is
prayed for against them, as the interpleader have appeared in court, one of them pleads ownership of the
personal property located in the Philippines and seeks to exclude a non-resident claimant from any interest
therein, is a question which we do not decide not. Suffice it to say that here the service of the summons by
publication was ordered by the lower court by virtue of an action quasi in rem against the non-resident
defendant.
Respondents contend that, as the petitioner in the lower court has pleaded over the subject-matter, she has
submitted herself to its jurisdiction. We have noticed, however, that these pleas have been made not as
independent grounds for relief, but merely as additional arguments in support of her contention that the lower
court had no jurisdiction over the person. In other words, she claimed that the lower court had no jurisdiction
over her person not only because she is a non-resident, but also because the court had no jurisdiction over the
subject-matter of the action and that the issues therein involved have already been decided by the New York
court and are being relitigated in the California court. Although this argument is obviously erroneous, as
neither jurisdiction over the subject-matter nor res adjudicata nor lis pendens has anything to do with the
question of jurisdiction over her person, we believe and so hold that the petitioner has not, by such erroneous
argument, submitted herself to the jurisdiction of the court. Voluntary appearance cannot be implied from
either a mistaken or superfluous reasoning but from the nature of the relief prayed for.
For all the foregoing, petition is hereby denied, with costs against petitioner.
Avancea, C.J., Villa-Real, Imperial, Diaz and Concepcion, JJ., concur.

G.R. No. L-825

July 20, 1948

ROMAN MABANAG, plaintiff-appellant,


vs.
JOSEPH M. GALLEMORE, defendant-appellee.
Santiago Catane for appellant.
No appearance for appellee.
TUASON, J.:
This case, here on appeal from an order dismissal by the Court of First Instance of Occidental Misamis, raises
the question of the court's jurisdiction. More specifically, the question is whether the action is in personam or
one in rem. The trial court opined that it is the first and that it "has no authority nor jurisdiction to render
judgment against the herein defendant, Joseph M. Gallemore for being a non-resident.

13

The purpose of the action is to recover P735.18, an amount said to have been paid by the plaintiff to the
defendant for two parcels of land whose sale was afterward annulled. The defendant is said to be residing in
Los Angeles, California, U. S. A. He has no property in the Philippine except an alleged debt owing him by a
resident of the municipality of Occidental Misamis. This debt, upon petition of the plaintiff, after the filing of
the complaint and before the suit was dismissed, was attached to the extent of plaintiff's claim for the
payment of which the action was brought. But the attachment was dissolved in the same order dismissing the
case.
It was Atty. Valeriano S. Kaamino who has amicus curi filed the motion to dismiss and to set aside the
attachment. There is no appearance before this Court to oppose the appeal.
Section 2, Rule 5, of the Rules of Court provides:
If any of the defendants does not reside and is not found in the Philippines, and the action effects the
personal status of the plaintiff, or any property of the defendant located in the Philippines, the action
may be commenced and tried in the province where the plaintiff resides or the property, or any portion
thereof, is situated or found.
The Philippine leading cases in which this Rule, or its counterpart in the former Code of Civil Procedure,
section 377 and 395, were cited and applied, are Banco Espaol-Filipino vs. Palanca, 37 Phil. 921, and Slade
Perkins vs. Dizon, 40 Off. Gaz., [3d Suppl.], No. 7, p. 216. The gist of this Court's ruling in these cases, in so
far as it is relevant to the present issues, is given in I Moran's Comments on the Rules of Court, 2d Ed., 105:
As a general rule, when the defendant is not residing and is not found in the Philippines, the
Philippine courts cannot try any case against him because of the impossibility of acquiring
jurisdiction over his person, unless he voluntarily appears in court. But, when the action affects the
personal status of the plaintiff residing in the Philippines, or is intended to seize or dispose of any
property, real or personal, of the defendant, located in the Philippines, it may be validly tried by the
Philippine courts, for then, they have jurisdiction over the res, i.e., the personal status of the plaintiff
or the property of the defendant, and their jurisdiction over the person of the non-resident defendant is
not essential. Venue in such cases may be laid in the province where the plaintiff whose personal
status is in question resides, or where the property of the defendant or a part thereof involved in the
litigation is located.
Literally this Court said:
Jurisdiction over the property which is the subject of litigation may result either from a seizure of the
property under legal process, whereby it is brought into the actual custody of the law, or it may result
from the institution of legal proceedings wherein, under special provisions of law, the power of the
court over the property is recognized and made effective. In the latter case the property, though at all
times within the potential power of the court, may never be taken into actual custody at all. An
illustration of the jurisdiction acquired by actual seizure is found in attachment proceedings, where
the property is seized at the beginning of the action, or some subsequent stage of its progress, and
held to abide the final event of the litigation. An illustration of what we term potential jurisdiction
over the res, is found in the proceeding to register the title of land under our system for the
registration of land. Here the court, without taking actual physical control over the property assumes,
at the instance of some person claiming to be owner, to exercise a jurisdiction in rem over the
property and to adjudicate the title in favor of the petitioner against all the world. (Banco EspaolFilipino vs. Palanca, supra, 927-928.).
In an ordinary attachment proceeding, if the defendant is not personally served, the preliminary
seizure is to be considered necessary in order to confer jurisdiction upon the court. In this case the lien
on the property is acquired by the seizure; and the purpose of the proceeding is to subject the property
to that lien. If a lien already exists, whether created by mortgage, contract, or statute, the preliminary
seizure is not necessary; and the court proceeds to enforce such lien in the manner provided by law
precisely as though the property had been seized upon attachment. (Roller vs. Holly, 176 U.S., 398,
405; 44 Law. ed., 520.) It results that the mere circumstance that in an attachment the property may be
seized at the inception of the proceedings, while in the foreclosure suit it is not taken into legal
custody until the time comes for the sale, does not materially affect the fundamental principle

14

involved in both cases, which is that the court is here exercising a jurisdiction over the property in a
proceeding directed essentially in rem. (Id., 929-930.).
When, however, the action relates to property located in the Philippines, the Philippine courts may
validly try the case, upon the principles that a "State, through its tribunals, may subject property
situated within its limit owned by non-residents to the payment of the demand of its own citizens
against them; and the exercise of this jurisdiction in no respect infringes upon the sovereignty of the
State were the owners are domiciled. Every State owes protection to its own citizens; and, when nonresidents deal with them, it is a legitimate and just exercise of authority to hold any appropriate any
property owned by such non-residents to satisfy the claims of its citizens. It is in virtue of the State's
jurisdiction over the property of the non-resident situated within its limits that its tribunals can inquire
into the non-resident's obligations to its own citizens, and the inquiry can then be carried only to the
extent necessary to control disposition of the property. If the non-resident has no property in the State,
there is nothing upon which the tribunals can adjudicate. (Slade Perkins vs. Dizon, 40 Off. Gaz. [3d
Supplement], No. 7, p. 216.).
A fuller statement of the principle whereunder attachment or garnishment of property of a non-resident
defendant confers jurisdiction on the court in an otherwise personal action, appears in two well known and
authoritative works:
The main action in an attachment or garnishment suit is in rem until jurisdiction of the defendant is
secured. Thereafter, it is in personam and also in rem, unless jurisdiction of the res is lost as by
dissolution of the attachment. If jurisdiction of the defendant is acquired but jurisdiction of the res is
lost, it is then purely in personam. . . a proceeding against property without jurisdiction of the person
of the defendant is in substance a proceeding in rem; and where there is jurisdiction of the defendant,
but the proceedings against the property continues, that proceedings is none the less necessarily in
rem, although in form there is but a single proceeding. (4 Am. Jur., 556-557.)
As the remedy is administered in some states, the theory of an attachment, whether it is by process
against or to subject the property or effects of a resident or non-resident of the state, is that it partakes
essentially of the nature and character of the proceeding in personam and not of a proceeding in rem.
And if the defendant appears the action proceeds in accordance with the practice governing
proceedings in personam. But were the defendant fails to appear in the action, the proceeding is to be
considered as one in the nature of a proceeding in rem. And where the court acts directly on the
property, the title thereof being charged by the court without the intervention of the party, the
proceeding unquestionably is one in rem in the fullest meaning of the term.
In attachment proceedings against a non-resident defendant where personal service on him is lacking,
it is elementary that the court must obtain jurisdiction of the property of the defendant. If no steps
have been taken to acquire jurisdiction of the defendant's person, and he has not appeared and
answered or otherwise submitted himself to the jurisdiction of the court, the court is without
jurisdiction to render judgment until there has been a lawful seizure of property owned by him within
the jurisdiction of the court. (2 R. C. L., 800-804.).
Tested by the foregoing decisions and authorities, the Court has acquired jurisdiction of the case at bar by
virtue of the attachment of the defendant's credit. Those authorities and decisions, so plain and
comprehensive as to make any discussion unnecessary, are in agreement that though no jurisdiction is
obtained over the debtor's person, the case may proceed to judgment if there is property in the custody of the
court that can be applied to its satisfaction.
It is our judgment that the court below erred in dismissing the case and dissolving the attachment; and it is
ordered that, upon petition of the plaintiff, it issue a new writ of attachment and then proceed to trial. The
costs of this appeal will be charged to defendant and appellee.
Paras, Feria, Pablo, Perfecto, Bengzon, Briones and Padilla, JJ., concur.

G.R. No. L-11390

March 26, 1918

15

EL BANCO ESPAOL-FILIPINO, plaintiff-appellant,


vs.
VICENTE PALANCA, administrator of the estate of Engracio Palanca Tanquinyeng, defendant-appellant.
Aitken and DeSelms for appellant.
Hartigan and Welch for appellee.
STREET, J.:
This action was instituted upon March 31, 1908, by "El Banco Espanol-Filipino" to foreclose a mortgage
upon various parcels of real property situated in the city of Manila. The mortgage in question is dated June
16, 1906, and was executed by the original defendant herein, Engracio Palanca Tanquinyeng y Limquingco,
as security for a debt owing by him to the bank. Upon March 31, 1906, the debt amounted to P218,294.10
and was drawing interest at the rate of 8 per centum per annum, payable at the end of each quarter. It appears
that the parties to this mortgage at that time estimated the value of the property in question at P292,558,
which was about P75,000 in excess of the indebtedness. After the execution of this instrument by the
mortgagor, he returned to China which appears to have been his native country; and he there died, upon
January 29, 1810, without again returning to the Philippine Islands.
As the defendant was a nonresident at the time of the institution of the present action, it was necessary for the
plaintiff in the foreclosure proceeding to give notice to the defendant by publication pursuant to section 399
of the Code of Civil Procedure. An order for publication was accordingly obtained from the court, and
publication was made in due form in a newspaper of the city of Manila. At the same time that the order of the
court should deposit in the post office in a stamped envelope a copy of the summons and complaint directed
to the defendant at his last place of residence, to wit, the city of Amoy, in the Empire of China. This order
was made pursuant to the following provision contained in section 399 of the Code of Civil Procedure:
In case of publication, where the residence of a nonresident or absent defendant is known, the judge
must direct a copy of the summons and complaint to be forthwith deposited by the clerk in the postoffice, postage prepaid, directed to the person to be served, at his place of residence
Whether the clerk complied with this order does not affirmatively appear. There is, however, among the
papers pertaining to this case, an affidavit, dated April 4, 1908, signed by Bernardo Chan y Garcia, an
employee of the attorneys of the bank, showing that upon that date he had deposited in the Manila post-office
a registered letter, addressed to Engracio Palanca Tanquinyeng, at Manila, containing copies of the complaint,
the plaintiff's affidavit, the summons, and the order of the court directing publication as aforesaid. It appears
from the postmaster's receipt that Bernardo probably used an envelope obtained from the clerk's office, as the
receipt purports to show that the letter emanated from the office.
The cause proceeded in usual course in the Court of First Instance; and the defendant not having appeared,
judgment was, upon July 2, 1908, taken against him by default. Upon July 3, 1908, a decision was rendered
in favor of the plaintiff. In this decision it was recited that publication had been properly made in a periodical,
but nothing was said about this notice having been given mail. The court, upon this occasion, found that the
indebtedness of the defendant amounted to P249,355. 32, with interest from March 31, 1908. Accordingly it
was ordered that the defendant should, on or before July 6, 1908, deliver said amount to the clerk of the court
to be applied to the satisfaction of the judgment, and it was declared that in case of the failure of the
defendant to satisfy the judgment within such period, the mortgage property located in the city of Manila
should be exposed to public sale. The payment contemplated in said order was never made; and upon July 8,
1908, the court ordered the sale of the property. The sale took place upon July 30, 1908, and the property was
bought in by the bank for the sum of P110,200. Upon August 7, 1908, this sale was confirmed by the court.
About seven years after the confirmation of this sale, or to the precise, upon June 25, 1915, a motion was
made in this cause by Vicente Palanca, as administrator of the estate of the original defendant, Engracio
Palanca Tanquinyeng y Limquingco, wherein the applicant requested the court to set aside the order of
default of July 2, 1908, and the judgment rendered upon July 3, 1908, and to vacate all the proceedings
subsequent thereto. The basis of this application, as set forth in the motion itself, was that the order of default
and the judgment rendered thereon were void because the court had never acquired jurisdiction over the
defendant or over the subject of the action.

16

At the hearing in the court below the application to vacate the judgment was denied, and from this action of
the court Vicente Planca, as administrator of the estate of the original defendant, has appealed. No other
feature of the case is here under consideration than such as related to the action of the court upon said motion.
The case presents several questions of importance, which will be discussed in what appears to be the
sequence of most convenient development. In the first part of this opinion we shall, for the purpose of
argument, assume that the clerk of the Court of First Instance did not obey the order of the court in the matter
of mailing the papers which he was directed to send to the defendant in Amoy; and in this connection we
shall consider, first, whether the court acquired the necessary jurisdiction to enable it to proceed with the
foreclosure of the mortgage and, secondly, whether those proceedings were conducted in such manner as to
constitute due process of law.
The word "jurisdiction," as applied to the faculty of exercising judicial power, is used in several different,
though related, senses since it may have reference (1) to the authority of the court to entertain a particular
kind of action or to administer a particular kind of relief, or it may refer to the power of the court over the
parties, or (2) over the property which is the subject to the litigation.
The sovereign authority which organizes a court determines the nature and extent of its powers in general and
thus fixes its competency or jurisdiction with reference to the actions which it may entertain and the relief it
may grant.
Jurisdiction over the person is acquired by the voluntary appearance of a party in court and his submission to
its authority, or it is acquired by the coercive power of legal process exerted over the person.
Jurisdiction over the property which is the subject of the litigation may result either from a seizure of the
property under legal process, whereby it is brought into the actual custody of the law, or it may result from
the institution of legal proceedings wherein, under special provisions of law, the power of the court over the
property is recognized and made effective. In the latter case the property, though at all times within the
potential power of the court, may never be taken into actual custody at all. An illustration of the jurisdiction
acquired by actual seizure is found in attachment proceedings, where the property is seized at the beginning
of the action, or some subsequent stage of its progress, and held to abide the final event of the litigation. An
illustration of what we term potential jurisdiction over the res, is found in the proceeding to register the title
of land under our system for the registration of land. Here the court, without taking actual physical control
over the property assumes, at the instance of some person claiming to be owner, to exercise a jurisdiction in
rem over the property and to adjudicate the title in favor of the petitioner against all the world.
In the terminology of American law the action to foreclose a mortgage is said to be a proceeding quasi in
rem, by which is expressed the idea that while it is not strictly speaking an action in rem yet it partakes of that
nature and is substantially such. The expression "action in rem" is, in its narrow application, used only with
reference to certain proceedings in courts of admiralty wherein the property alone is treated as responsible for
the claim or obligation upon which the proceedings are based. The action quasi rem differs from the true
action in rem in the circumstance that in the former an individual is named as defendant, and the purpose of
the proceeding is to subject his interest therein to the obligation or lien burdening the property. All
proceedings having for their sole object the sale or other disposition of the property of the defendant, whether
by attachment, foreclosure, or other form of remedy, are in a general way thus designated. The judgment
entered in these proceedings is conclusive only between the parties.
In speaking of the proceeding to foreclose a mortgage the author of a well known treaties, has said:
Though nominally against person, such suits are to vindicate liens; they proceed upon seizure; they
treat property as primarily indebted; and, with the qualification above-mentioned, they are
substantially property actions. In the civil law, they are styled hypothecary actions, and their sole
object is the enforcement of the lien against the res; in the common law, they would be different in
chancery did not treat the conditional conveyance as a mere hypothecation, and the creditor's right ass
an equitable lien; so, in both, the suit is real action so far as it is against property, and seeks the
judicial recognition of a property debt, and an order for the sale of the res. (Waples, Proceedings In
Rem. sec. 607.)

17

It is true that in proceedings of this character, if the defendant for whom publication is made appears, the
action becomes as to him a personal action and is conducted as such. This, however, does not affect the
proposition that where the defendant fails to appear the action is quasi in rem; and it should therefore be
considered with reference to the principles governing actions in rem.
There is an instructive analogy between the foreclosure proceeding and an action of attachment, concerning
which the Supreme Court of the United States has used the following language:
If the defendant appears, the cause becomes mainly a suit in personam, with the added incident, that
the property attached remains liable, under the control of the court, to answer to any demand which
may be established against the defendant by the final judgment of the court. But, if there is no
appearance of the defendant, and no service of process on him, the case becomes, in its essential
nature, a proceeding in rem, the only effect of which is to subject the property attached to the payment
of the defendant which the court may find to be due to the plaintiff. (Cooper vs. Reynolds, 10 Wall.,
308.)
In an ordinary attachment proceeding, if the defendant is not personally served, the preliminary seizure is to,
be considered necessary in order to confer jurisdiction upon the court. In this case the lien on the property is
acquired by the seizure; and the purpose of the proceedings is to subject the property to that lien. If a lien
already exists, whether created by mortgage, contract, or statute, the preliminary seizure is not necessary; and
the court proceeds to enforce such lien in the manner provided by law precisely as though the property had
been seized upon attachment. (Roller vs. Holly, 176 U. S., 398, 405; 44 L. ed., 520.) It results that the mere
circumstance that in an attachment the property may be seized at the inception of the proceedings, while in
the foreclosure suit it is not taken into legal custody until the time comes for the sale, does not materially
affect the fundamental principle involved in both cases, which is that the court is here exercising a
jurisdiction over the property in a proceeding directed essentially in rem.
Passing now to a consideration of the jurisdiction of the Court of First Instance in a mortgage foreclosure, it
is evident that the court derives its authority to entertain the action primarily from the statutes organizing the
court. The jurisdiction of the court, in this most general sense, over the cause of action is obvious and
requires no comment. Jurisdiction over the person of the defendant, if acquired at all in such an action, is
obtained by the voluntary submission of the defendant or by the personal service of process upon him within
the territory where the process is valid. If, however, the defendant is a nonresident and, remaining beyond the
range of the personal process of the court, refuses to come in voluntarily, the court never acquires jurisdiction
over the person at all. Here the property itself is in fact the sole thing which is impleaded and is the
responsible object which is the subject of the exercise of judicial power. It follows that the jurisdiction of the
court in such case is based exclusively on the power which, under the law, it possesses over the property; and
any discussion relative to the jurisdiction of the court over the person of the defendant is entirely apart from
the case. The jurisdiction of the court over the property, considered as the exclusive object of such action, is
evidently based upon the following conditions and considerations, namely: (1) that the property is located
within the district; (2) that the purpose of the litigation is to subject the property by sale to an obligation fixed
upon it by the mortgage; and (3) that the court at a proper stage of the proceedings takes the property into
custody, if necessary, and expose it to sale for the purpose of satisfying the mortgage debt. An obvious
corollary is that no other relief can be granted in this proceeding than such as can be enforced against the
property.
We may then, from what has been stated, formulated the following proposition relative to the foreclosure
proceeding against the property of a nonresident mortgagor who fails to come in and submit himself
personally to the jurisdiction of the court: (I) That the jurisdiction of the court is derived from the power
which it possesses over the property; (II) that jurisdiction over the person is not acquired and is nonessential;
(III) that the relief granted by the court must be limited to such as can be enforced against the property itself.
It is important that the bearing of these propositions be clearly apprehended, for there are many expressions
in the American reports from which it might be inferred that the court acquires personal jurisdiction over the
person of the defendant by publication and notice; but such is not the case. In truth the proposition that
jurisdiction over the person of a nonresident cannot be acquired by publication and notice was never clearly
understood even in the American courts until after the decision had been rendered by the Supreme Court of
the United States in the leading case of Pennoyer vs. Neff (95 U. S. 714; 24 L. ed., 565). In the light of that
decision, and of other decisions which have subsequently been rendered in that and other courts, the

18

proposition that jurisdiction over the person cannot be thus acquired by publication and notice is no longer
open to question; and it is now fully established that a personal judgment upon constructive or substituted
service against a nonresident who does not appear is wholly invalid. This doctrine applies to all kinds of
constructive or substituted process, including service by publication and personal service outside of the
jurisdiction in which the judgment is rendered; and the only exception seems to be found in the case where
the nonresident defendant has expressly or impliedly consented to the mode of service. (Note to Raher vs.
Raher, 35 L. R. A. [N. S. ], 292; see also 50 L .R. A., 585; 35 L. R. A. [N. S.], 312
The idea upon which the decision in Pennoyer vs. Neff (supra) proceeds is that the process from the tribunals
of one State cannot run into other States or countries and that due process of law requires that the defendant
shall be brought under the power of the court by service of process within the State, or by his voluntary
appearance, in order to authorize the court to pass upon the question of his personal liability. The doctrine
established by the Supreme Court of the United States on this point, being based upon the constitutional
conception of due process of law, is binding upon the courts of the Philippine Islands. Involved in this
decision is the principle that in proceedings in rem or quasi in rem against a nonresident who is not served
personally within the state, and who does not appear, the relief must be confined to the res, and the court
cannot lawfully render a personal judgment against him. (Dewey vs. Des Moines, 173 U. S., 193; 43 L. ed.,
665; Heidritter vs. Elizabeth Oil Cloth Co., 112 U. S., 294; 28 L. ed., 729.) Therefore in an action to foreclose
a mortgage against a nonresident, upon whom service has been effected exclusively by publication, no
personal judgment for the deficiency can be entered. (Latta vs. Tutton, 122 Cal., 279; Blumberg vs. Birch, 99
Cal., 416.)
It is suggested in the brief of the appellant that the judgment entered in the court below offends against the
principle just stated and that this judgment is void because the court in fact entered a personal judgment
against the absent debtor for the full amount of the indebtedness secured by the mortgage. We do not so
interpret the judgment.
In a foreclosure proceeding against a nonresident owner it is necessary for the court, as in all cases of
foreclosure, to ascertain the amount due, as prescribed in section 256 of the Code of Civil Procedure, and to
make an order requiring the defendant to pay the money into court. This step is a necessary precursor of the
order of sale. In the present case the judgment which was entered contains the following words:
Because it is declared that the said defendant Engracio Palanca Tanquinyeng y Limquingco, is
indebted in the amount of P249,355.32, plus the interest, to the 'Banco Espanol-Filipino' . . . therefore
said appellant is ordered to deliver the above amount etc., etc.
This is not the language of a personal judgment. Instead it is clearly intended merely as a compliance with the
requirement that the amount due shall be ascertained and that the evidence of this it may be observed that
according to the Code of Civil Procedure a personal judgment against the debtor for the deficiency is not to
be rendered until after the property has been sold and the proceeds applied to the mortgage debt. (sec. 260).
The conclusion upon this phase of the case is that whatever may be the effect in other respects of the failure
of the clerk of the Court of First Instance to mail the proper papers to the defendant in Amoy, China, such
irregularity could in no wise impair or defeat the jurisdiction of the court, for in our opinion that jurisdiction
rest upon a basis much more secure than would be supplied by any form of notice that could be given to a
resident of a foreign country.
Before leaving this branch of the case, we wish to observe that we are fully aware that many reported cases
can be cited in which it is assumed that the question of the sufficiency of publication or notice in a case of
this kind is a question affecting the jurisdiction of the court, and the court is sometimes said to acquire
jurisdiction by virtue of the publication. This phraseology was undoubtedly originally adopted by the court
because of the analogy between service by the publication and personal service of process upon the
defendant; and, as has already been suggested, prior to the decision of Pennoyer vs. Neff (supra) the
difference between the legal effects of the two forms of service was obscure. It is accordingly not surprising
that the modes of expression which had already been molded into legal tradition before that case was decided
have been brought down to the present day. But it is clear that the legal principle here involved is not effected
by the peculiar language in which the courts have expounded their ideas.

19

We now proceed to a discussion of the question whether the supposed irregularity in the proceedings was of
such gravity as to amount to a denial of that "due process of law" which was secured by the Act of Congress
in force in these Islands at the time this mortgage was foreclosed. (Act of July 1, 1902, sec. 5.) In dealing
with questions involving the application of the constitutional provisions relating to due process of law the
Supreme Court of the United States has refrained from attempting to define with precision the meaning of
that expression, the reason being that the idea expressed therein is applicable under so many diverse
conditions as to make any attempt ay precise definition hazardous and unprofitable. As applied to a judicial
proceeding, however, it may be laid down with certainty that the requirement of due process is satisfied if the
following conditions are present, namely; (1) There must be a court or tribunal clothed with judicial power to
hear and determine the matter before it; (2) jurisdiction must be lawfully acquired over the person of the
defendant or over the property which is the subject of the proceeding; (3) the defendant must be given an
opportunity to be heard; and (4) judgment must be rendered upon lawful hearing.
Passing at once to the requisite that the defendant shall have an opportunity to be heard, we observe that in a
foreclosure case some notification of the proceedings to the nonresident owner, prescribing the time within
which appearance must be made, is everywhere recognized as essential. To answer this necessity the statutes
generally provide for publication, and usually in addition thereto, for the mailing of notice to the defendant, if
his residence is known. Though commonly called constructive, or substituted service of process in any true
sense. It is merely a means provided by law whereby the owner may be admonished that his property is the
subject of judicial proceedings and that it is incumbent upon him to take such steps as he sees fit to protect it.
In speaking of notice of this character a distinguish master of constitutional law has used the following
language:
. . . if the owners are named in the proceedings, and personal notice is provided for, it is rather from
tenderness to their interests, and in order to make sure that the opportunity for a hearing shall not be
lost to them, than from any necessity that the case shall assume that form. (Cooley on Taxation [2d.
ed.], 527, quoted in Leigh vs. Green, 193 U. S., 79, 80.)
It will be observed that this mode of notification does not involve any absolute assurance that the absent
owner shall thereby receive actual notice. The periodical containing the publication may never in fact come
to his hands, and the chances that he should discover the notice may often be very slight. Even where notice
is sent by mail the probability of his receiving it, though much increased, is dependent upon the correctness
of the address to which it is forwarded as well as upon the regularity and security of the mail service. It will
be noted, furthermore, that the provision of our law relative to the mailing of notice does not absolutely
require the mailing of notice unconditionally and in every event, but only in the case where the defendant's
residence is known. In the light of all these facts, it is evident that actual notice to the defendant in cases of
this kind is not, under the law, to be considered absolutely necessary.
The idea upon which the law proceeds in recognizing the efficacy of a means of notification which may fall
short of actual notice is apparently this: Property is always assumed to be in the possession of its owner, in
person or by agent; and he may be safely held, under certain conditions, to be affected with knowledge that
proceedings have been instituted for its condemnation and sale.
It is the duty of the owner of real estate, who is a nonresident, to take measures that in some way he
shall be represented when his property is called into requisition, and if he fails to do this, and fails to
get notice by the ordinary publications which have usually been required in such cases, it is his
misfortune, and he must abide the consequences. (6 R. C. L., sec. 445 [p. 450]).
It has been well said by an American court:
If property of a nonresident cannot be reached by legal process upon the constructive notice, then our
statutes were passed in vain, and are mere empty legislative declarations, without either force, or
meaning; for if the person is not within the jurisdiction of the court, no personal judgment can be
rendered, and if the judgment cannot operate upon the property, then no effective judgment at all can
be rendered, so that the result would be that the courts would be powerless to assist a citizen against a
nonresident. Such a result would be a deplorable one. (Quarl vs. Abbett, 102 Ind., 233; 52 Am. Rep.,
662, 667.)

20

It is, of course universally recognized that the statutory provisions relative to publication or other form of
notice against a nonresident owner should be complied with; and in respect to the publication of notice in the
newspaper it may be stated that strict compliance with the requirements of the law has been held to be
essential. In Guaranty Trust etc. Co. vs. Green Cove etc., Railroad Co. (139 U. S., 137, 138), it was held that
where newspaper publication was made for 19 weeks, when the statute required 20, the publication was
insufficient.
With respect to the provisions of our own statute, relative to the sending of notice by mail, the requirement is
that the judge shall direct that the notice be deposited in the mail by the clerk of the court, and it is not in
terms declared that the notice must be deposited in the mail. We consider this to be of some significance; and
it seems to us that, having due regard to the principles upon which the giving of such notice is required, the
absent owner of the mortgaged property must, so far as the due process of law is concerned, take the risk
incident to the possible failure of the clerk to perform his duty, somewhat as he takes the risk that the mail
clerk or the mail carrier might possibly lose or destroy the parcel or envelope containing the notice before it
should reach its destination and be delivered to him. This idea seems to be strengthened by the consideration
that placing upon the clerk the duty of sending notice by mail, the performance of that act is put effectually
beyond the control of the plaintiff in the litigation. At any rate it is obvious that so much of section 399 of the
Code of Civil Procedure as relates to the sending of notice by mail was complied with when the court made
the order. The question as to what may be the consequences of the failure of the record to show the proof of
compliance with that requirement will be discussed by us further on.
The observations which have just been made lead to the conclusion that the failure of the clerk to mail the
notice, if in fact he did so fail in his duty, is not such an irregularity, as amounts to a denial of due process of
law; and hence in our opinion that irregularity, if proved, would not avoid the judgment in this case. Notice
was given by publication in a newspaper and this is the only form of notice which the law unconditionally
requires. This in our opinion is all that was absolutely necessary to sustain the proceedings.
It will be observed that in considering the effect of this irregularity, it makes a difference whether it be
viewed as a question involving jurisdiction or as a question involving due process of law. In the matter of
jurisdiction there can be no distinction between the much and the little. The court either has jurisdiction or it
has not; and if the requirement as to the mailing of notice should be considered as a step antecedent to the
acquiring of jurisdiction, there could be no escape from the conclusion that the failure to take that step was
fatal to the validity of the judgment. In the application of the idea of due process of law, on the other hand, it
is clearly unnecessary to be so rigorous. The jurisdiction being once established, all that due process of law
thereafter requires is an opportunity for the defendant to be heard; and as publication was duly made in the
newspaper, it would seem highly unreasonable to hold that failure to mail the notice was fatal. We think that
in applying the requirement of due process of law, it is permissible to reflect upon the purposes of the
provision which is supposed to have been violated and the principle underlying the exercise of judicial power
in these proceedings. Judge in the light of these conceptions, we think that the provision of Act of Congress
declaring that no person shall be deprived of his property without due process of law has not been infringed.
In the progress of this discussion we have stated the two conclusions; (1) that the failure of the clerk to send
the notice to the defendant by mail did not destroy the jurisdiction of the court and (2) that such irregularity
did not infringe the requirement of due process of law. As a consequence of these conclusions the irregularity
in question is in some measure shorn of its potency. It is still necessary, however, to consider its effect
considered as a simple irregularity of procedure; and it would be idle to pretend that even in this aspect the
irregularity is not grave enough. From this point of view, however, it is obvious that any motion to vacate the
judgment on the ground of the irregularity in question must fail unless it shows that the defendant was
prejudiced by that irregularity. The least, therefore, that can be required of the proponent of such a motion is
to show that he had a good defense against the action to foreclose the mortgage. Nothing of the kind is,
however, shown either in the motion or in the affidavit which accompanies the motion.
An application to open or vacate a judgment because of an irregularity or defect in the proceedings is usually
required to be supported by an affidavit showing the grounds on which the relief is sought, and in addition to
this showing also a meritorious defense to the action. It is held that a general statement that a party has a
good defense to the action is insufficient. The necessary facts must be averred. Of course if a judgment is
void upon its face a showing of the existence of a meritorious defense is not necessary. (10 R. C. L., 718.)

21

The lapse of time is also a circumstance deeply affecting this aspect of the case. In this connection we quote
the following passage from the encyclopedic treatise now in course of publication:
Where, however, the judgment is not void on its face, and may therefore be enforced if permitted to
stand on the record, courts in many instances refuse to exercise their quasi equitable powers to vacate
a judgement after the lapse of the term ay which it was entered, except in clear cases, to promote the
ends of justice, and where it appears that the party making the application is himself without fault and
has acted in good faith and with ordinary diligence. Laches on the part of the applicant, if
unexplained, is deemed sufficient ground for refusing the relief to which he might otherwise be
entitled. Something is due to the finality of judgments, and acquiescence or unnecessary delay is fatal
to motions of this character, since courts are always reluctant to interfere with judgments, and
especially where they have been executed or satisfied. The moving party has the burden of showing
diligence, and unless it is shown affirmatively the court will not ordinarily exercise its discretion in
his favor. (15 R. C. L., 694, 695.)
It is stated in the affidavit that the defendant, Engracio Palanca Tanquinyeng y Limquingco, died January 29,
1910. The mortgage under which the property was sold was executed far back in 1906; and the proceedings
in the foreclosure were closed by the order of court confirming the sale dated August 7, 1908. It passes the
rational bounds of human credulity to suppose that a man who had placed a mortgage upon property worth
nearly P300,000 and had then gone away from the scene of his life activities to end his days in the city of
Amoy, China, should have long remained in ignorance of the fact that the mortgage had been foreclosed and
the property sold, even supposing that he had no knowledge of those proceedings while they were being
conducted. It is more in keeping with the ordinary course of things that he should have acquired information
as to what was transpiring in his affairs at Manila; and upon the basis of this rational assumption we are
authorized, in the absence of proof to the contrary, to presume that he did have, or soon acquired, information
as to the sale of his property.
The Code of Civil Procedure, indeed, expressly declares that there is a presumption that things have
happened according to the ordinary habits of life (sec. 334 [26]); and we cannot conceive of a situation more
appropriate than this for applying the presumption thus defined by the lawgiver. In support of this
presumption, as applied to the present case, it is permissible to consider the probability that the defendant
may have received actual notice of these proceedings from the unofficial notice addressed to him in Manila
which was mailed by an employee of the bank's attorneys. Adopting almost the exact words used by the
Supreme Court of the United States in Grannis vs. Ordeans (234 U. S., 385; 58 L. ed., 1363), we may say that
in view of the well-known skill of postal officials and employees in making proper delivery of letters
defectively addressed, we think the presumption is clear and strong that this notice reached the defendant,
there being no proof that it was ever returned by the postal officials as undelivered. And if it was delivered in
Manila, instead of being forwarded to Amoy, China, there is a probability that the recipient was a person
sufficiently interested in his affairs to send it or communicate its contents to him.
Of course if the jurisdiction of the court or the sufficiency of the process of law depended upon the mailing of
the notice by the clerk, the reflections in which we are now indulging would be idle and frivolous; but the
considerations mentioned are introduced in order to show the propriety of applying to this situation the legal
presumption to which allusion has been made. Upon that presumption, supported by the circumstances of this
case, ,we do not hesitate to found the conclusion that the defendant voluntarily abandoned all thought of
saving his property from the obligation which he had placed upon it; that knowledge of the proceedings
should be imputed to him; and that he acquiesced in the consequences of those proceedings after they had
been accomplished. Under these circumstances it is clear that the merit of this motion is, as we have already
stated, adversely affected in a high degree by the delay in asking for relief. Nor is it an adequate reply to say
that the proponent of this motion is an administrator who only qualified a few months before this motion was
made. No disability on the part of the defendant himself existed from the time when the foreclosure was
effected until his death; and we believe that the delay in the appointment of the administrator and institution
of this action is a circumstance which is imputable to the parties in interest whoever they may have been. Of
course if the minor heirs had instituted an action in their own right to recover the property, it would have been
different.
It is, however, argued that the defendant has suffered prejudice by reason of the fact that the bank became the
purchaser of the property at the foreclosure sale for a price greatly below that which had been agreed upon in
the mortgage as the upset price of the property. In this connection, it appears that in article nine of the

22

mortgage which was the subject of this foreclosure, as amended by the notarial document of July 19, 1906,
the parties to this mortgage made a stipulation to the effect that the value therein placed upon the mortgaged
properties should serve as a basis of sale in case the debt should remain unpaid and the bank should proceed
to a foreclosure. The upset price stated in that stipulation for all the parcels involved in this foreclosure was
P286,000. It is said in behalf of the appellant that when the bank bought in the property for the sum of
P110,200 it violated that stipulation.
It has been held by this court that a clause in a mortgage providing for a tipo, or upset price, does not prevent
a foreclosure, nor affect the validity of a sale made in the foreclosure proceedings. (Yangco vs. Cruz Herrera
and Wy Piaco, 11 Phil. Rep., 402; Banco-Espaol Filipino vs. Donaldson, Sim and Co., 5 Phil. Rep., 418.) In
both the cases here cited the property was purchased at the foreclosure sale, not by the creditor or mortgagee,
but by a third party. Whether the same rule should be applied in a case where the mortgagee himself becomes
the purchaser has apparently not been decided by this court in any reported decision, and this question need
not here be considered, since it is evident that if any liability was incurred by the bank by purchasing for a
price below that fixed in the stipulation, its liability was a personal liability derived from the contract of
mortgage; and as we have already demonstrated such a liability could not be the subject of adjudication in an
action where the court had no jurisdiction over the person of the defendant. If the plaintiff bank became liable
to account for the difference between the upset price and the price at which in bought in the property, that
liability remains unaffected by the disposition which the court made of this case; and the fact that the bank
may have violated such an obligation can in no wise affect the validity of the judgment entered in the Court
of First Instance.
In connection with the entire failure of the motion to show either a meritorious defense to the action or that
the defendant had suffered any prejudice of which the law can take notice, we may be permitted to add that in
our opinion a motion of this kind, which proposes to unsettle judicial proceedings long ago closed, can not be
considered with favor, unless based upon grounds which appeal to the conscience of the court. Public policy
requires that judicial proceedings be upheld. The maximum here applicable is non quieta movere. As was
once said by Judge Brewer, afterwards a member of the Supreme Court of the United States:
Public policy requires that judicial proceedings be upheld, and that titles obtained in those
proceedings be safe from the ruthless hand of collateral attack. If technical defects are adjudged
potent to destroy such titles, a judicial sale will never realize that value of the property, for no prudent
man will risk his money in bidding for and buying that title which he has reason to fear may years
thereafter be swept away through some occult and not readily discoverable defect. (Martin vs. Pond,
30 Fed., 15.)
In the case where that language was used an attempt was made to annul certain foreclosure proceedings on
the ground that the affidavit upon which the order of publication was based erroneously stated that the State
of Kansas, when he was in fact residing in another State. It was held that this mistake did not affect the
validity of the proceedings.
In the preceding discussion we have assumed that the clerk failed to send the notice by post as required by
the order of the court. We now proceed to consider whether this is a proper assumption; and the proposition
which we propose to establish is that there is a legal presumption that the clerk performed his duty as the
ministerial officer of the court, which presumption is not overcome by any other facts appearing in the cause.
In subsection 14 of section 334 of the Code of Civil Procedure it is declared that there is a presumption "that
official duty has been regularly performed;" and in subsection 18 it is declared that there is a presumption
"that the ordinary course of business has been followed." These presumptions are of course in no sense
novelties, as they express ideas which have always been recognized. Omnia presumuntur rite et solemniter
esse acta donec probetur in contrarium. There is therefore clearly a legal presumption that the clerk
performed his duty about mailing this notice; and we think that strong considerations of policy require that
this presumption should be allowed to operate with full force under the circumstances of this case. A party to
an action has no control over the clerk of the court; and has no right to meddle unduly with the business of
the clerk in the performance of his duties. Having no control over this officer, the litigant must depend upon
the court to see that the duties imposed on the clerk are performed.
Other considerations no less potent contribute to strengthen the conclusion just stated. There is no principle
of law better settled than that after jurisdiction has once been required, every act of a court of general

23

jurisdiction shall be presumed to have been rightly done. This rule is applied to every judgment or decree
rendered in the various stages of the proceedings from their initiation to their completion (Voorhees vs.
United States Bank, 10 Pet., 314; 35 U. S., 449); and if the record is silent with respect to any fact which
must have been established before the court could have rightly acted, it will be presumed that such fact was
properly brought to its knowledge. (The Lessee of Grignon vs. Astor, 2 How., 319; 11 L. ed., 283.)
In making the order of sale [of the real state of a decedent] the court are presumed to have adjudged
every question necessary to justify such order or decree, viz: The death of the owners; that the
petitioners were his administrators; that the personal estate was insufficient to pay the debts of the
deceased; that the private acts of Assembly, as to the manner of sale, were within the constitutional
power of the Legislature, and that all the provisions of the law as to notices which are directory to the
administrators have been complied with. . . . The court is not bound to enter upon the record the
evidence on which any fact was decided. (Florentine vs. Barton, 2 Wall., 210; 17 L. ed., 785.)
Especially does all this apply after long lapse of time.
Applegate vs. Lexington and Carter County Mining Co. (117 U. S., 255) contains an instructive discussion in
a case analogous to that which is now before us. It there appeared that in order to foreclose a mortgage in the
State of Kentucky against a nonresident debtor it was necessary that publication should be made in a
newspaper for a specified period of time, also be posted at the front door of the court house and be published
on some Sunday, immediately after divine service, in such church as the court should direct. In a certain
action judgment had been entered against a nonresident, after publication in pursuance of these provisions.
Many years later the validity of the proceedings was called in question in another action. It was proved from
the files of an ancient periodical that publication had been made in its columns as required by law; but no
proof was offered to show the publication of the order at the church, or the posting of it at the front door of
the court-house. It was insisted by one of the parties that the judgment of the court was void for lack of
jurisdiction. But the Supreme Court of the United States said:
The court which made the decree . . . was a court of general jurisdiction. Therefore every presumption
not inconsistent with the record is to be indulged in favor of its jurisdiction. . . . It is to be presumed
that the court before making its decree took care of to see that its order for constructive service, on
which its right to make the decree depended, had been obeyed.
It is true that in this case the former judgment was the subject of collateral , or indirect attack, while in the
case at bar the motion to vacate the judgment is direct proceeding for relief against it. The same general
presumption, however, is indulged in favor of the judgment of a court of general jurisdiction, whether it is the
subject of direct or indirect attack the only difference being that in case of indirect attack the judgment is
conclusively presumed to be valid unless the record affirmatively shows it to be void, while in case of direct
attack the presumption in favor of its validity may in certain cases be overcome by proof extrinsic to the
record.
The presumption that the clerk performed his duty and that the court made its decree with the knowledge that
the requirements of law had been complied with appear to be amply sufficient to support the conclusion that
the notice was sent by the clerk as required by the order. It is true that there ought to be found among the
papers on file in this cause an affidavit, as required by section 400 of the Code of Civil Procedure, showing
that the order was in fact so sent by the clerk; and no such affidavit appears. The record is therefore silent
where it ought to speak. But the very purpose of the law in recognizing these presumptions is to enable the
court to sustain a prior judgment in the face of such an omission. If we were to hold that the judgment in this
case is void because the proper affidavit is not present in the file of papers which we call the record, the result
would be that in the future every title in the Islands resting upon a judgment like that now before us would
depend, for its continued security, upon the presence of such affidavit among the papers and would be liable
at any moment to be destroyed by the disappearance of that piece of paper. We think that no court, with a
proper regard for the security of judicial proceedings and for the interests which have by law been confided
to the courts, would incline to favor such a conclusion. In our opinion the proper course in a case of this kind
is to hold that the legal presumption that the clerk performed his duty still maintains notwithstanding the
absence from the record of the proper proof of that fact.
In this connection it is important to bear in mind that under the practice prevailing in the Philippine Islands
the word "record" is used in a loose and broad sense, as indicating the collective mass of papers which
contain the history of all the successive steps taken in a case and which are finally deposited in the archives

24

of the clerk's office as a memorial of the litigation. It is a matter of general information that no judgment roll,
or book of final record, is commonly kept in our courts for the purpose of recording the pleadings and
principal proceedings in actions which have been terminated; and in particular, no such record is kept in the
Court of First Instance of the city of Manila. There is, indeed, a section of the Code of Civil Procedure which
directs that such a book of final record shall be kept; but this provision has, as a matter of common
knowledge, been generally ignored. The result is that in the present case we do not have the assistance of the
recitals of such a record to enable us to pass upon the validity of this judgment and as already stated the
question must be determined by examining the papers contained in the entire file.
But it is insisted by counsel for this motion that the affidavit of Bernardo Chan y Garcia showing that upon
April 4, 1908, he sent a notification through the mail addressed to the defendant at Manila, Philippine Islands,
should be accepted as affirmative proof that the clerk of the court failed in his duty and that, instead of
himself sending the requisite notice through the mail, he relied upon Bernardo to send it for him. We do not
think that this is by any means a necessary inference. Of course if it had affirmatively appeared that the clerk
himself had attempted to comply with this order and had directed the notification to Manila when he should
have directed it to Amoy, this would be conclusive that he had failed to comply with the exact terms of the
order; but such is not this case. That the clerk of the attorneys for the plaintiff erroneously sent a notification
to the defendant at a mistaken address affords in our opinion very slight basis for supposing that the clerk
may not have sent notice to the right address.
There is undoubtedly good authority to support the position that when the record states the evidence or makes
an averment with reference to a jurisdictional fact, it will not be presumed that there was other or different
evidence respecting the fact, or that the fact was otherwise than stated. If, to give an illustration, it appears
from the return of the officer that the summons was served at a particular place or in a particular manner, it
will not be presumed that service was also made at another place or in a different manner; or if it appears that
service was made upon a person other than the defendant, it will not be presumed, in the silence of the record,
that it was made upon the defendant also (Galpin vs. Page, 18 Wall., 350, 366; Settlemier vs. Sullivan, 97 U.
S., 444, 449). While we believe that these propositions are entirely correct as applied to the case where the
person making the return is the officer who is by law required to make the return, we do not think that it is
properly applicable where, as in the present case, the affidavit was made by a person who, so far as the
provisions of law are concerned, was a mere intermeddler.
The last question of importance which we propose to consider is whether a motion in the cause is admissible
as a proceeding to obtain relief in such a case as this. If the motion prevails the judgment of July 2, 1908, and
all subsequent proceedings will be set aside, and the litigation will be renewed, proceeding again from the
date mentioned as if the progress of the action had not been interrupted. The proponent of the motion does
not ask the favor of being permitted to interpose a defense. His purpose is merely to annul the effective
judgment of the court, to the end that the litigation may again resume its regular course.
There is only one section of the Code of Civil Procedure which expressly recognizes the authority of a Court
of First Instance to set aside a final judgment and permit a renewal of the litigation in the same cause. This is
as follows:
SEC. 113. Upon such terms as may be just the court may relieve a party or legal representative from
the judgment, order, or other proceeding taken against him through his mistake, inadvertence,
surprise, or excusable neglect; Provided, That application thereof be made within a reasonable time,
but in no case exceeding six months after such judgment, order, or proceeding was taken.
An additional remedy by petition to the Supreme Court is supplied by section 513 of the same Code. The first
paragraph of this section, in so far as pertinent to this discussion, provides as follows:
When a judgment is rendered by a Court of First Instance upon default, and a party thereto is unjustly
deprived of a hearing by fraud, accident, mistake or excusable negligence, and the Court of First
Instance which rendered the judgment has finally adjourned so that no adequate remedy exists in that
court, the party so deprived of a hearing may present his petition to the Supreme Court within sixty
days after he first learns of the rendition of such judgment, and not thereafter, setting forth the facts
and praying to have judgment set aside. . . .

25

It is evident that the proceeding contemplated in this section is intended to supplement the remedy provided
by section 113; and we believe the conclusion irresistible that there is no other means recognized by law
whereby a defeated party can, by a proceeding in the same cause, procure a judgment to be set aside, with a
view to the renewal of the litigation.
The Code of Civil Procedure purports to be a complete system of practice in civil causes, and it contains
provisions describing with much fullness the various steps to be taken in the conduct of such proceedings. To
this end it defines with precision the method of beginning, conducting, and concluding the civil action of
whatever species; and by section 795 of the same Code it is declared that the procedure in all civil action
shall be in accordance with the provisions of this Code. We are therefore of the opinion that the remedies
prescribed in sections 113 and 513 are exclusive of all others, so far as relates to the opening and continuation
of a litigation which has been once concluded.
The motion in the present case does not conform to the requirements of either of these provisions; and the
consequence is that in our opinion the action of the Court of First Instance in dismissing the motion was
proper.
If the question were admittedly one relating merely to an irregularity of procedure, we cannot suppose that
this proceeding would have taken the form of a motion in the cause, since it is clear that, if based on such an
error, the came to late for relief in the Court of First Instance. But as we have already seen, the motion attacks
the judgment of the court as void for want of jurisdiction over the defendant. The idea underlying the motion
therefore is that inasmuch as the judgment is a nullity it can be attacked in any way and at any time. If the
judgment were in fact void upon its face, that is, if it were shown to be a nullity by virtue of its own recitals,
there might possibly be something in this. Where a judgment or judicial order is void in this sense it may be
said to be a lawless thing, which can be treated as an outlaw and slain at sight, or ignored wherever and
whenever it exhibits its head.
But the judgment in question is not void in any such sense. It is entirely regular in form, and the alleged
defect is one which is not apparent upon its face. It follows that even if the judgment could be shown to be
void for want of jurisdiction, or for lack of due process of law, the party aggrieved thereby is bound to resort
to some appropriate proceeding to obtain relief. Under accepted principles of law and practice, long
recognized in American courts, a proper remedy in such case, after the time for appeal or review has passed,
is for the aggrieved party to bring an action to enjoin the judgment, if not already carried into effect; or if the
property has already been disposed of he may institute suit to recover it. In every situation of this character an
appropriate remedy is at hand; and if property has been taken without due process, the law concedes due
process to recover it. We accordingly old that, assuming the judgment to have been void as alleged by the
proponent of this motion, the proper remedy was by an original proceeding and not by motion in the cause.
As we have already seen our Code of Civil Procedure defines the conditions under which relief against a
judgment may be productive of conclusion for this court to recognize such a proceeding as proper under
conditions different from those defined by law. Upon the point of procedure here involved, we refer to the
case of People vs. Harrison (84 Cal., 607) wherein it was held that a motion will not lie to vacate a judgment
after the lapse of the time limited by statute if the judgment is not void on its face; and in all cases, after the
lapse of the time limited by statute if the judgment is not void on its face; and all cases, after the lapse of such
time, when an attempt is made to vacate the judgment by a proceeding in court for that purpose an action
regularly brought is preferable, and should be required. It will be noted taken verbatim from the California
Code (sec. 473).
The conclusions stated in this opinion indicate that the judgment appealed from is without error, and the same
is accordingly affirmed, with costs. So ordered.
Arellano, C.J., Torres, Carson, and Avancea, JJ., concur.

Separate Opinions
MALCOLM, J., dissenting:

26

I dissent. It will not make me long to state my reasons. An immutable attribute the fundamental idea of
due process of law is that no man shall be condemned in his person or property without notice and an
opportunity of being heard in his defense. Protection of the parties demands a strict and an exact compliance
with this constitutional provision in our organic law and of the statutory provisions in amplification. Literally
hundreds of precedents could be cited in support of these axiomatic principles. Where as in the instant case
the defendant received no notice and had no opportunity to be heard, certainly we cannot say that there is due
process of law. Resultantly, "A judgment which is void upon its face, and which requires only an inspection
of the judgment roll to demonstrate its want of vitality is a dead limb upon the judicial tree, which should be
lopped off, if the power so to do exists. It can bear no fruit to the plaintiff, but is a constant menace to the
defendant." (Mills vs. Dickons, 6 Rich [S. C.], 487.)

El Banco Espaol-Filipino vs Vicente Palanca


on November 23, 2010
Judicial Due Process Requisites
Engracio Palanca was indebted to El Banco and he had his parcel of land as security to his debt. His debt
amounted to P218,294.10. His property is worth 75k more than what he owe. Due to the failure of Engracio
to make his payments, El Banco executed an instrument to mortgage Engracios property. Engracio however
left for China and he never returned til he died. Since Engracio is a non resident El Banco has to notify
Engracio about their intent to sue him by means of publication using a newspaper. The lower court further
orderdd the clerk of court to furnish Engracio a copy and that itd be sent to Amoy, China. The court
eventually granted El Banco petition to execute Engracios property. 7 years thereafter, Vicente surfaced on
behalf of Engracio as his administrator to petition for the annulment of the ruling. Vicente averred that there
had been no due process as Engracio never received the summons.
ISSUE: Whether or not due process was not observed.
HELD: The SC ruled against Palanca. The SC ruled that the requisites for judicial due process had been met.
The requisites are;
1.
There must be an impartial court or tribunal clothed with judicial power to hear and decide the matter
before it.
2.
Jurisdiction must be lawfully acquired over the person of the defendant or over the property subject of
the proceedings.
3.
The defendant must be given the opportunity to be heard.
4.
Judgment must be rendered only after lawful hearing.

SPOUSES WILLIAM GENATO


and REBECCA GENATO,
Petitioners,

- versus -

G.R. No. 169706


Present:
CARPIO, J., Chairperson,
BRION,
DEL CASTILLO
ABAD, and
PEREZ, JJ.

RITA VIOLA,

Promulgated:
Respondent.
February 5, 2010
x-------------------------------------------------------------------x
DECISION

27

DEL CASTILLO, J.:


When there is a conflict between the title of the case and the allegations in the complaint, the latter prevail in
determining the parties to the action. Jurisprudence directs us to look beyond the form and into the substance so as to
render substantial justice to the parties and determine speedily and inexpensively the actual merits of the controversy
with least regard to technicalities.
In the present Petition for Review, petitioners assail the September 9, 2005 Decision [1] of the Court of Appeals
(CA) in CA-G.R. SP No. 89466 which affirmed the Decision of the Office of the President. The Office of the
President affirmed the Decision of the Housing and Land Use Regulatory Board (HLURB), First Division which
granted the motion to quash the writ of execution issued in HLURB Case No. REM-102491-4959 (REM-A-9504260059).
Factual Antecedents
In October 1991, a complaint titled "VILLA REBECCA HOMEOWNERS ASSOCIATION, INC. versus
MR. WILLIAM GENATO and spouse REBECCA GENATO" was filed with the HLURB. The said complaint was
verified by 34 individuals, including the respondent herein, who referred to themselves as the "Complainants" who
"caused the preparation of the foregoing Complaint".[2] The complaint stated that on various dates, complainants
executed Contracts to Sell and/or Lease Purchase Agreements with the Sps. Genato pertaining to housing units in Villa
Rebecca Homes Subdivision. Sometime thereafter the HLURB issued a cease and desist order (CDO) enjoining the
collection of amortization payments. This CDO was subsequently lifted. Thereafter, complainants went to the Sps.
Genato with the intention of resuming their amortization payments. The latter however refused to accept their
payments and instead demanded for a lump sum payment of all the accrued amortizations which fell due during the
effectivity of the CDO.
From the disorganized, bordering on incomprehensible, complaint, it can be gleaned that the following reliefs
are prayed for: 1) That Sps. Genato accept the complainants' monthly amortization payments corresponding to the
period of effectivity of the (subsequently lifted) CDO, without any penalty; 2) That the computation of interest on
delinquent payments be at 3% per month and not compounded; 3) That Sps. Genato be responsible for correcting the
deficiencies in the construction and replacement of sub-standard materials to conform with the plans and specifications;
4) That Sps. Genato be held answerable/liable to make good their undertaking to provide individual deep wells for the
homeowners; 5) That Sps. Genato be responsible for maintaining the street lights and payment of the corresponding
electric bills; 6) That Sps. Genato maintain the contract price of the units for sale and not increase the prices; and 7)
That Sps. Genato be made accountable for the unregistered dwelling units.
On March 8, 1995, the Housing Arbiter rendered a Decision, the dispositive portion of which states:
WHEREFORE, all the foregoing premises being considered, judgment is hereby rendered
ordering complainants to resume payment of their monthly amortization from date hereof pursuant to
the agreement. Likewise, it is hereby ordered that respondents correct the deficiencies in the
construction of the complaining occupants' units so as to conform to that which is specified in the plans
and specification of the buildings, as well as observe proper drainage requirements pursuant to
law. Likewise, respondents are hereby directed to immediately put up commercial wells and/or water
pumps or facilities in the Villa Rebecca Subdivision and to reimburse complainants and unit occupants
of their total expenditures incurred for their water supply.[3]

28

On appeal to the HLURB Board of Commissioners, the Decision was modified, inter alia, by the additional
directive for the complainants to pay 3% interest per month for the unpaid amortizations due from June 29, 1991. The
dispositive portion of the Decision of the HLURB Board of Commissioners states:
WHEREFORE, premises considered, the decision of the Arbiter is hereby MODIFIED to read
as follows:
1. Ordering complainants to pay respondent the remaining balance of the purchase price. Complainant
must pay 3% interest per month for unpaid amortizations due from June 29, 1991. Thereafter
complainant must pay its amortization in accordance with the original term of the contract. These
must be complied with upon finality of this decision.
2.

Ordering the respondent to:


a. Accept the amortization payment;
b. Provide drainage outfall;
c. Provide the project with water facilities; and
d. Reimburse complainant the following:
d.1 Electric Bills in the amount of P3,146.66
d.2 Cost of construction of water supply to be determined by an appraiser mutually
acceptable to the parties.
Number 2.d to 2.e [sic] must be complied with within thirty (30) days from finality of this
decision.
SO ORDERED.[4]
This Decision, after being revised and then reinstated, subsequently became final and executory.
On May 26, 2000, Arbiter Marino Bernardo M. Torres issued the Writ of Execution. In connection therewith,
the sheriff seized Rita Viola's two delivery trucks and 315 sacks of rice. Respondent Viola then filed an Urgent Motion
to Quash Execution, with Prayers for Issuance of Temporary Restraining Order, Clarification and Computation of
Correct Amount of Money Judgment and Allowance of Appeal.
After various incidents and pleadings by the opposing parties, the two trucks were ordered released. The 315
sacks of rice, however, were sold at public auction to the highest bidder,[5] petitioner Rebecca Genato in the amount
of P189,000.00.[6]
On December 15, 2000, Arbiter Torres issued an Order denying respondent Viola's motion to quash the writ of
execution and directed her to pay the Sps. Genato the amount of P739,133.31. The dispositive portion of the Order
reads:
WHEREFORE, premises considered, the motion to quash writ of execution is hereby
DENIED.
Movant Rita Viola is hereby directed to pay to the respondents the amount of P739,133.31
in payment of their amortizations up to August 2000.
The bond posted by the movant in compliance with the directive of this Office is likewise
ordered cancelled.
SO ORDERED.[7]

29

Viola appealed the said Order and on January 10, 2003, the HLURB, First Division rendered a Decision, the
dispositive portion of which reads:
WHEREFORE, premises considered, the movants' respective Motions to Quash the Writ of
Execution are hereby GRANTED. Accordingly, the Orders dated December 15, [2000] are hereby
SET ASIDE. The respondents are directed to credit as payment the value of the 315 sacks of rice in
the amount of P318,500.00, which were seized and auctioned to the account of movant Viola.
SO ORDERED.[8]
The Sps. Genato appealed the said Decision to the Office of the President. On November 8, 2004, the Office
of the President affirmed in toto the Decision of the HLURB, First Division. The motion for reconsideration filed by
the Sps. Genato was denied. They thus elevated the case to the CA. As previously mentioned, the CA affirmed the
Decision of the Office of the President and disposed as follows:
WHEREFORE, premises considered, the petition is DENIED and the assailed decision dated
November 4, 2004 and resolution dated March 31, 2005 of the Office of the President in O.P. Case No.
03-B-057 are hereby AFFIRMED.
SO ORDERED.[9]
The Sps. Genato no longer filed a motion for reconsideration, they instead filed the present petition for review.
Issues
Petitioners raise the following issues:
1.

WHETHER THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT THE


HLURB HAS NOT ACQUIRED JURISDICTION OVER THE PERSON OF RESPONDENT
RITA VIOLA.

2.

WHETHER AFTER THE DECISION HAS BECOME FINAL AND EXECUTORY THE
HLURB COULD STILL RULE ON THE LACK OF JURISDICTION OVER THE PERSON
OF RITA VIOLA.

3.

WHETHER RESPONDENT VIOLA CAN CLAIM AN AMOUNT HIGHER THAN WHAT


APPEARS ON SHERIFF'S CERTIFICATE OF SALE.

4.

WHETHER THE RULE THAT FINDINGS OF FACTS AND CONCLUSIONS OF ANY


ADJUDICATIVE BODY SHOULD BE CONSIDERED AS BINDING AND CONCLUSIVE
ON THE APPELLATE COURT, IS APPLICABLE IN THE CASE AT BAR.[10]

Petitioners' Arguments

Petitioners contend that the CA erred in applying the case of Duero v. Court of Appeals,[11] which held that the
lack of jurisdiction of the court over an action cannot be waived. They submit that "jurisdiction of the court over an
action" is different from "jurisdiction over the person". They say that the latter was what the HLURB was referring to
because it stated that Rita Viola was never impleaded. They contend that jurisdiction over the person can be conferred
by consent expressly or impliedly given, as in the case of Rita Viola.

30

Petitioners also assert that the HLURB Decision subject of the writ of execution has long been final and
executory, hence, said Decision can no longer be modified. They further assert that the execution of the said Decision
is a ministerial duty of the HLURB.
Petitioners further argue that the best evidence of the value of the 315 sacks of rice seized and auctioned off is
the Sheriff's Certificate of Sale; hence the Board's ruling crediting to the account of Viola an amount other than that
stated in the Certificate of Sale has no sound basis.
Finally, the petitioners contend that the findings and conclusions of an adjudicative body resulting from an
erroneous application of law are not binding on the appellate courts.
Respondent's Arguments

On the other hand, respondent contends that the HLURB did not acquire jurisdiction over her person since she
was not a party to the case; hence, the HLURB decision is a nullity as against her and therefore never acquired
finality. With a void judgment, the resultant execution was likewise void.
She also argues that, since the levy and auction were illegal, the correct valuation of the 315 sacks of rice is not
the price paid at the auction but its actual value ofP318,500.00.
Our Ruling
The petition has merit.
At the outset, it is worth mentioning that except for respondent Rita Viola, all the other individual
members/buyers/owners of the respective housing units have already paid and settled their obligations with Sps.
Genato.[12] Hence, in the present case we only focus on the matters involving Rita Viola.
For a more orderly presentation, we address the fourth issue raised by petitioners first.
Non-applicability of the doctrine on the binding effect of
findings of facts and conclusions of an adjudicative body

Indeed findings of fact and conclusions of an adjudicative body like the HLURB, which can be considered as a
trier of facts on specific matters within its field of expertise, should be considered as binding and conclusive upon the
appellate courts. This is in addition to the fact that it was in a better position to assess and evaluate the credibility of the
contending parties and the validity of their respective evidence. However, these doctrines hold true only when such
findings and conclusions are supported by substantial evidence.[13]
In the present case, we find it difficult to find sufficient evidential support for the HLURB's conclusion that it
did not acquire jurisdiction over the person of Viola. We are thus persuaded that there is ample justification to disturb
the findings of the HLURB.
The HLURB acquired jurisdiction over Viola

31

It is not the caption of the pleading but the allegations therein that are controlling.[14] The inclusion of the
names of all the parties in the title of a complaint is a formal requirement under Section 3, Rule 7 of the Rules of
Court. However, the rules of pleadings require courts to pierce the form and go into the substance. [15] The noninclusion of one or some of the names of all the complainants in the title of a complaint, is not fatal to the case,
provided there is a statement in the body of the complaint indicating that such complainant/s was/were made party to
such action. This is specially true before the HLURB where the proceedings are summary in nature without regard to
legal technicalities obtaining in the courts of law[16] and where the pertinent concern is to promote public interest and to
assist the parties in obtaining just, speedy and inexpensive determination of every action, application or other
proceedings.[17]
Respondent Viola, although her name did not appear in the title as a party, was one of the persons who caused
the preparation of the complaint and who verified the same. The allegations in the body of the complaint indicate that
she is one of the complainants. She categorically considered, and held out, herself as one of the complainants from the
time of the filing of the complaint and up to the time the decision in the HLURB case became final and executory. To
repeat, the averments in the body of the complaint, not the title, are controlling. [18] Hence, having been set forth in the
body of the complaint as a complainant, Viola was a party to the case.
For clarity, the complaint should have been amended to reflect in the title the individual complainants. There
being a "defect in the designation of the parties", its correction could be summarily made at any stage of the action
provided no prejudice is caused thereby to the adverse party.[19] In the present case, the specification of the individual
complainants in the title of the case would not constitute a change in the identity of the parties. Only their names were
omitted in the title but they were already parties to the case, most importantly, they were heard through their counsel
whom they themselves chose to prepare the complaint and represent them in the case before the HLURB. No
unfairness or surprise to the complainants, including Viola, or to the Sps. Genato would result by allowing the
amendment, the purpose of which is merely to conform to procedural rules or to correct a technical error.[20]
It is now too late to dismiss this petition, and, in effect, nullify all proceedings had before the HLURB on the
ground that Viola does not appear to have been impleaded as a party. The error or defect is merely formal and not
substantial and an amendment to cure such defect is expressly authorized by Sec. 4, Rule 10 of the Rules of Court.[21]
Moreover, it was only when the final and executory judgment of the HLURB was already being executed
against Viola that she, for the first time, reversed her position; and claimed that she was not a party to the case and that
the HLURB did not acquire jurisdiction over her. Viola is estopped[22] from taking such inconsistent positions. Where
a party, by his or her deed or conduct, has induced another to act in a particular manner, estoppel effectively bars the
former from adopting an inconsistent position, attitude or course of conduct that causes loss or injury to the latter. The
doctrine of estoppel is based upon the grounds of public policy, fair dealing, good faith and justice, and its purpose is to
forbid one to speak against his own act, representations, or commitments to the injury of one to whom they were
directed and who reasonably relied thereon. After petitioners had reasonably relied on the representations of Viola that
she was a complainant and entered into the proceedings before the HLURB, she cannot now be permitted to impugn
her representations to the injury of the petitioners.
At this point, it may be beneficial to elaborate on the matter of jurisdiction. Jurisdiction is defined as the power
and authority of a court to hear, try and decide a case.[23] In order for the court or an adjudicative body to have authority
to dispose of the case on the merits, it must acquire jurisdiction over the subject matter and the parties. [24] Elementary is
the distinction between jurisdiction over the subject matter and jurisdiction over the person. Jurisdiction over the

32

subject matter is conferred by the Constitution or by law. In contrast, jurisdiction over the person is acquired by the
court by virtue of the party's voluntary submission to the authority of the court or through the exercise of its coercive
processes. Jurisdiction over the person is waivable unlike jurisdiction over the subject matter which is neither subject
to agreement nor conferred by consent of the parties. [25] In civil case, courts acquire jurisdiction over the plaintiffs upon
the filing of the complaint, while jurisdiction over the defendants is acquired either through the service of summons
upon them in the manner required by law or through their voluntary appearance in court and their submission to its
authority.[26]
The act of filing the complaint with the HLURB is unequivocally a voluntary submission by the complainants,
including Viola, to the authority of the HLURB. Clearly, the HLURB acquired jurisdiction over Viola, who was one of
the complainants, upon the filing of their complaint.
Final and executory judgment may no longer be modified
The April 27, 1999 HLURB Resolution,[27] reinstating the December 18, 1996 Decision,[28] has long been final
and executory. Nothing is more settled in the law than that a decision that has acquired finality becomes immutable
and unalterable and may no longer be modified in any respect even if the modification is meant to correct erroneous
conclusions of fact or law and whether it was made by the court that rendered it or by the highest court of the land.
[29]
The only recognized exceptions to the general rule are the correction of clerical errors, the so-called nunc pro
tunc entries which cause no prejudice to any party, void judgments, and whenever circumstances transpire after the
finality of the decision rendering its execution unjust and inequitable. [30] None of the exceptions is present in this
case. The HLURB decision cannot be considered a void judgment, as it was rendered by a tribunal with jurisdiction
over the subject matter of the complaint and, as discussed above, with jurisdiction over the parties. Hence, the same
can no longer be modified.
Amount to be credited on account
of the sale of property levied upon
After a judgment has gained finality, it becomes the ministerial duty of the court or quasi-judicial tribunal to
order its execution.[31] In the present case, the final and executory HLURB decision was partially executed by the sale
of the 315 sacks of rice belonging to Viola.
In determining the amount to be credited to the account of Viola, we look at the Sheriff's Partial Report and the
Sheriff's Certificate of Sale. Both documents state that in the auction sale of the 315 sacks of rice, Mrs. Rebecca
Genato submitted the highest bid in the amount of P189,000.00. Drawing from Section 19, Rule 39 of the Rules of
Court which states that "all sales of property under execution must be made at public auction, to the highest bidder," it
naturally follows that the highest bid submitted is the amount that should be credited to the account of the judgment
debtor.
WHEREFORE, the petition is GRANTED. The assailed September 9, 2005 Decision of the Court of Appeals
is REVERSED and SET ASIDE and the December 15, 2000 Order of Arbiter Marino Bernardo M. Torres
is REINSTATED and AFFIRMED.
SO ORDERED.

33

G.R. No. 128803 September 25, 1998


ASIAVEST LIMITED, petitioner,
vs.
THE COURT OF APPEALS and ANTONIO HERAS, respondents.

DAVIDE, JR., J.:


In issue is the enforceability in the Philippines of a foreign judgment. The antecedents are summarized in the
24 August 1990 Decision 1 of Branch 107 of the Regional Trial Court of Quezon City in Civil Case No. Q52452; thus:
The plaintiff Asiavest Limited filed a complaint on December 3, 1987 against the defendant
Antonio Heras praying that said defendant be ordered to pay to the plaintiff the amounts
awarded by the Hong Kong Court Judgment dated December 28, 1984 and amended on April
13, 1987, to wit:
1) US$1,810,265.40 or its equivalent in Hong Kong currency at
the time of payment with legal interest from December 28, 1984
until fully paid;
2) interest on the sum of US$1,500.00 at 9.875% per annum
from October 31, 1984 to December 28, 1984; and
3) HK$905.00 at fixed cost in the action; and
4) at least $80,000.00 representing attorney's fees, litigation
expenses and cost, with interest thereon from the date of the
judgment until fully paid.
On March 3, 1988, the defendant filed a Motion to Dismiss. However, before the court could
resolve the said motion, a fire which partially razed the Quezon City Hall Building on June 11,
1988 totally destroyed the office of this Court, together with all its records, equipment and
properties. On July 26, 1988, the plaintiff, through counsel filed a Motion for Reconstitution
of Case Records. The Court, after allowing the defendant to react thereto, granted the said
Motion and admitted the annexes attached thereto as the reconstituted records of this case per
Order dated September 6, 1988. Thereafter, the Motion to Dismiss, the resolution of which
had been deferred; was denied by the Court in its Order of October 4, 1988.
On October 19, 1988, defendant filed his Answer. The case was then set for pre-trial
conference. At the conference, the parties could not arrive at any settlement. However, they
agreed on the following stipulations of facts:
1. The defendant admits the existence of the judgment dated
December 28, 1984 as well as its amendment dated April 13,
1987, but not necessarily the authenticity or validity thereof;
2. The plaintiff is not doing business and is not licensed to do
business in the Philippines;
3. The residence of defendant, Antonio Heras, is New Manila,
Quezon City.
The only issue for this Court to determine is, whether or not the judgment of the Hong Kong
Court has been repelled by evidence of want of jurisdiction, want of notice to the party,
collusion, fraud or clear mistake of law or fact, such as to overcome the presumption
established in Section 50, Rule 39 of the Rules of Court in favor of foreign judgments.

34

In view of the admission by the defendant of the existence of the aforementioned judgment
(Pls. See Stipulations of Facts in the Order dated January 5, 1989 as amended by the Order of
January 18, 1989), as well as the legal presumption in favor of the plaintiff as provided for in
paragraph (b); Sec. 50, (Ibid.), the plaintiff presented only documentary evidence to show
rendition, existence, and authentication of such judgment by the proper officials concerned
(Pls. See Exhibits "A" thru "B", with their submarkings). In addition, the plaintiff presented
testimonial and documentary evidence to show its entitlement to attorney's fees and other
expenses of litigation. . . . .
On the other hand, the defendant presented two witnesses, namely. Fortunata dela Vega and
Russel Warren Lousich.
The gist of Ms. dela Vega's testimony is to the effect that no writ of summons or copy of a
statement of claim of Asiavest Limited was ever served in the office of the Navegante
Shipping Agency Limited and/or for Mr. Antonio Heras, and that no service of the writ of
summons was either served on the defendant at his residence in New Manila, Quezon City.
Her knowledge is based on the fact that she was the personal secretary of Mr. Heras during his
JD Transit days up to the latter part of 1972 when he shifted or diversified to shipping business
in Hong Kong; that she was in-charge of all his letters and correspondence, business
commitments, undertakings, conferences and appointments, until October 1984 when Mr.
Heras left Hong Kong for good; that she was also the Officer-in-Charge or Office Manager of
Navegante Shipping Agency LTD, a Hong Kong registered and based company acting as ships
agent, up to and until the company closed shop sometime in the first quarter of 1985, when
shipping business collapsed worldwide; that the said company held office at 34-35 Connaught
Road, Central Hong Kong and later transferred to Carton House at Duddel Street, Hong Kong,
until the company closed shop in 1985; and that she was certain of such facts because she held
office at Caxton House up to the first quarter of 1985.
Mr. Lousich was presented as an expert on the laws of Hong Kong, and as a representative of
the law office of the defendant's counsel who made a verification of the record of the case
filed by the plaintiff in Hong Kong against the defendant, as well as the procedure in serving
Court processes in Hong Kong.
In his affidavit (Exh. "2") which constitutes his direct testimony, the said witness stated that:
The defendant was sued on the basis of his personal guarantee of the
obligations of Compania Hermanos de Navegacion S.A. There is no record that
a writ of summons was served on the person of the defendant in Hong Kong, or
that any such attempt at service was made. Likewise, there is no record that a
copy of the judgment of the High Court was furnished or served on the
defendant; anyway, it is not a legal requirement to do so under Hong Kong
laws;
a) The writ of summons or claim can be served by the solicitor
(lawyer) of the claimant or plaintiff. In Hong Kong there are no
Court personnel who serve writs of summons and/or most other
processes.
b) If the writ of summons or claim (or complaint) is not
contested, the claimant or the plaintiff is not required to present
proof of his claim or complaint nor present evidence under oath
of the claim in order to obtain a Judgment.
c) There is no legal requirement that such a Judgment or
decision rendered by the Court in Hong Kong [to] make a
recitation of the facts or the law upon which the claim is based.
d) There is no necessity to furnish the defendant with a copy of
the Judgment or decision rendered against him.

35

e) In an action based on a guarantee, there is no established legal


requirement or obligation under Hong Kong laws that the
creditor must first bring proceedings against the principal debtor.
The creditor can immediately go against the guarantor.
On cross examination, Mr. Lousich stated that before he was commissioned by the law firm of
the defendant's counsel as an expert witness and to verify the records of the Hong Kong case,
he had been acting as counsel for the defendant in a number of commercial matters; that there
was an application for service of summons upon the defendant outside the jurisdiction of
Hong Kong; that there was an order of the Court authorizing service upon Heras outside of
Hong Kong, particularly in Manila or any other place in the Philippines (p. 9, TSN, 2/14/90);
that there must be adequate proof of service of summons, otherwise the Hong Kong Court will
refuse to render judgment (p. 10, ibid); that the mere fact that the Hong Kong Court rendered
judgment, it can be presumed that there was service of summons; that in this case, it is not just
a presumption because there was an affidavit stating that service was effected in [sic] a
particular man here in Manila; that such affidavit was filed by one Jose R. Fernandez of the
firm Sycip Salazar on the 21st of December 1984, and stated in essence that "on Friday, the
23rd of November 1984 he served the 4th defendant at No. 6 First Street, Quezon City by
leaving it at that address with Mr. Dionisio Lopez, the son-in-law of the 4th defendant the
copy of the writ and Mr. Lopez informed me and I barely believed that he would bring the said
writ to the attention of the 4th defendant" (pp. 11-12, ibid.); that upon filing of that affidavit,
the Court was asked and granted judgment against the 4th defendant; and that if the summons
or claim is not contested, the claimant of the plaintiff is not required to present proof of his
claim or complaint or present evidence under oath of the claim in order to obtain judgment;
and that such judgment can be enforced in the same manner as a judgment rendered after full
hearing.
The trial court held that since the Hong Kong court judgment had been duly proved, it is a presumptive
evidence of a right as between the parties; hence, the party impugning it had the burden to prove want of
jurisdiction over his person. HERAS failed to discharge that burden. He did not testify to state categorically
and under oath that he never received summons. Even his own witness Lousich admitted that HERAS was
served with summons in his Quezon City residence. As to De la Vega's testimony regarding non-service of
summons, the same was hearsay and had no probative value.
As to HERAS' contention that the Hong Kong court judgment violated the Constitution and the procedural
laws of the Philippines because it contained no statements of the facts and the law on which it was based, the
trial court ruled that since the issue relate to procedural matters, the law of the forum, i.e., Hong Kong laws,
should govern. As testified by the expert witness Lousich, such legalities were not required under Hong Kong
laws. The trial Court also debunked HERAS' contention that the principle of excussion under Article 2058 of
the Civil Code of the Philippines was violated. It declared that matters of substance are subject to the law of
the place where the transaction occurred; in this case, Hong Kong laws must govern.
The trial court concluded that the Hong Kong court judgment should be recognized and given effect in this
jurisdiction for failure of HERAS to overcome the legal presumption in favor of the foreign judgment. It then
decreed; thus:
WHEREFORE, judgment is hereby rendered ordering defendant to pay to the plaintiff the
following sums or their equivalents in Philippine currency at the time of payment:
US$1,810,265.40 plus interest on the sum of US$1,500,000.00 at 9.875% per annum from
October 31, 1984 to December 28, 1984, and HK$905 as fixed cost, with legal interests on the
aggregate amount from December 28, 1984, and to pay attorney's fees in the sum of
P80,000.00.
ASIAVEST moved for the reconsideration of the decision. It sought an award of judicial costs and an
increase in attorney's fees in the amount of US$19,346.45 with interest until full payment of the said
obligations. On the other hand, HERAS no longer opposed the motion and instead appealed the decision to
the Court of Appeals, which docketed the appeal as CA-G.R. CV No. 29513.

36

In its order 2 of 2 November 1990, the trial court granted ASIAVEST's motion for reconsideration by
increasing the award of attorney's fees to "US$19,345.65 OR ITS EQUIVALENT IN PHILIPPINE
CURRENCY, AND TO PAY THE COSTS OF THIS SUIT," provided that ASIAVEST would pay the
corresponding filing fees for the increase. ASIAVEST appealed the order requiring prior payment of filing
fees. However, it later withdrew its appeal and paid the additional filing fees.
On 3 April 1997, the Court of Appeals rendered its decision 3 reversing the decision of the trial court and
dismissing ASIAVEST's complaint without prejudice. It underscored the fact that a foreign judgment does not
of itself have any extraterritorial application. For it to be given effect, the foreign tribunal should have
acquired jurisdiction over the person and the subject matter. If such tribunal has not acquired jurisdiction, its
judgment is void.
The Court of Appeals agreed with the trial court that matters of remedy and procedure, such as those relating
to service of summons upon the defendant are governed by the lex fori, which was, in this case, the law of
Hong Kong. Relative thereto, it gave weight to Lousich's testimony that under the Hong Kong law, the
substituted service of summons upon HERAS effected in the Philippines by the clerk of Sycip Salazar
Hernandez & Gatmaitan firm would be valid provided that it was done in accordance with Philippine laws. It
then stressed that where the action is in personam and the defendant is in the Philippines, the summons
should be personally served on the defendant pursuant to Section 7, Rule 14 of the Rules of
Court.4 Substituted service may only be availed of where the defendant cannot be promptly served in person,
the fact of impossibility of personal service should be explained in the proof of service. It also found as
persuasive HERAS' argument that instead of directly using the clerk of the Sycip Salazar Hernandez &
Gatmaitan law office, who was not authorized by the judge of the court issuing the summons, ASIAVEST
should have asked for leave of the local courts to have the foreign summons served by the sheriff or other
court officer of the place where service was to be made, or for special reasons by any person authorized by
the judge.
The Court of Appeals agreed with HERAS that "notice sent outside the state to a non-resident is unavailing
to give jurisdiction in an action against him personally for money recovery." Summons should have been
personally served on HERAS in Hong Kong, for, as claimed by ASIAVEST, HERAS was physically present
in Hong Kong for nearly 14 years. Since there was not even an attempt to serve summons on HERAS in
Hong Kong, the Hong Kong Supreme Court did not acquire jurisdiction over HERAS. Nonetheless it did not
totally foreclose the claim of ASIAVEST; thus:
While We are not fully convinced that [HERAS] has a meritorious defense against
[ASIAVEST's] claims or that [HERAS] ought to be absolved of any liability, nevertheless, in
view of the foregoing discussion, there is a need to deviate front the findings of the lower
court in the interest of justice and fair play. This, however, is without prejudice to whatever
action [ASIAVEST] might deem proper in order to enforce its claims against [HERAS].
Finally, the Court of Appeals also agreed with HERAS that it was necessary that evidence supporting the
validity of the foreign judgment be submitted, and that our courts are not bound to give effect to foreign
judgments which contravene our laws and the principle of sound morality and public policy.
ASIAVEST forthwith filed the instant petition alleging that the Court of Appeals erred in ruling that
I.
. . . IT WAS NECESSARY FOR [ASIAVEST] TO PRESENT EVIDENCE "SUPPORTING
THE VALIDITY OF THE JUDGMENT";
II.
. . . THE SERVICE OF SUMMONS ON [HERAS] WAS DEFECTIVE UNDER
PHILIPPINES LAW;
III.

37

. . . SUMMONS SHOULD HAVE BEEN PERSONALLY SERVED ON HERAS IN HONG


KONG;
IV.
. . . THE HONG KONG SUMMONS SHOULD HAVE BEEN SERVED WITH LEAVE OF
PHILIPPINE COURTS;
V.
. . . THE FOREIGN JUDGMENT "CONTRAVENES PHILIPPINE LAWS, THE
PRINCIPLES OF SOUND MORALITY, AND THE PUBLIC POLICY OF THE
PHILIPPINES.
Being interrelated, we shall take up together the assigned errors.
Under paragraph (b) of Section 50, Rule 39 of the Rules of Court, 5 which was the governing law at the time
this case was decided by the trial court and respondent Court of Appeals, a foreign judgment against a person
rendered by a court having jurisdiction to pronounce the judgment is presumptive evidence of a right as
between the parties and their successors in interest by the subsequent title. However, the judgment may be
repelled by evidence of want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of
law or fact.
Also, Section 3(n) of Rule 131 of the New Rules of Evidence provides that in the absence of proof to the
contrary, a court, or judge acting as such, whether in the Philippines or elsewhere, is presumed to have acted
in the lawful exercise of jurisdiction.
Hence, once the authenticity of the foreign judgment is proved, the burden to repel it on grounds provided for
in paragraph (b) of Section 50, Rule 39 of the Rules of Court is on the party challenging the foreign judgment
HERAS in this case.
At the pre-trial conference, HERAS admitted the existence of the Hong Kong judgment. On the other hand,
ASIAVEST presented evidence to prove rendition, existence, and authentication of the judgment by the
proper officials. The judgment is thus presumed to be valid and binding in the country from which it comes,
until the contrary is shown. 6 Consequently, the first ground relied upon by ASIAVEST has merit. The
presumption of validity accorded foreign judgment would be rendered meaningless were the party seeking to
enforce it be required to first establish its validity.
The main argument raised against the Hong Kong judgment is that the Hong Kong Supreme Court did not
acquire jurisdiction over the person of HERAS. This involves the issue of whether summons was properly
and validly served on HERAS. It is settled that matters of remedy and procedure such as those relating to the
service of process upon the defendant are governed by the lex fori or the law of the forum, 7 i.e., the law of
Hong Kong in this case. HERAS insisted that according to his witness Mr. Lousich, who was presented as an
expert on Hong Kong laws, there was no valid service of summons on him.
In his counter-affidavit, 8 which served as his direct testimony per agreement of the parties, 9 Lousich declared
that the record of the Hong Kong case failed to show that a writ of summons was served upon HERAS in
Hong Kong or that any such attempt was made. Neither did the record show that a copy of the judgment of
the court was served on HERAS. He stated further that under Hong Kong laws (a) a writ of summons could
be served by the solicitor of the claimant or plaintiff; and (b) where the said writ or claim was not contested,
the claimant or plaintiff was not required to present proof under oath in order to obtain judgment.
On cross-examination by counsel for ASIAVEST, Lousich' testified that the Hong Kong court authorized
service of summons on HERAS outside of its jurisdiction, particularly in the Philippines. He admitted also
the existence of an affidavit of one Jose R. Fernandez of the Sycip Salazar Hernandez & Gatmaitan law firm
stating that he (Fernandez) served summons on HERAS on 13 November 1984 at No. 6, 1st St., Quezon City,
by leaving a copy with HERAS's son-in-law Dionisio Lopez. 10 On redirect examination, Lousich declared
that such service of summons would be valid under Hong Kong laws provided that it was in accordance with
Philippine laws. 11

38

We note that there was no objection on the part of ASIAVEST on the qualification of Mr. Lousich as an
expert on the Hong Kong law. Under Sections 24 and 25, Rule 132 of the New Rules of Evidence, the record
of public documents of a sovereign authority, tribunal, official body, or public officer may be proved by (1)
an official publication thereof or (2) a copy attested by the officer having the legal custody thereof, which
must be accompanied, if the record is not kept in the Philippines, with a certificate that such officer has the
custody. The certificate may be issued by a secretary of the embassy or legation, consul general, consul, vice
consul, or consular agent, or any officer in the foreign service of the Philippines stationed in the foreign
country in which the record is kept, and authenticated by the seal of his office. The attestation must state, in
substance, that the copy is a correct copy of the original, or a specific part thereof, as the case may be, and
must be under the official seal of the attesting officer.
Nevertheless, the testimony of an expert witness may be allowed to prove a foreign law. An authority 12 on
private international law thus noted:
Although it is desirable that foreign law be proved in accordance with the above rule,
however, the Supreme Court held in the case ofWillamette Iron and Steel Works v.
Muzzal, 13 that Section 41, Rule 123 (Section 25, Rule 132 of the Revised Rules of Court) does
not exclude the presentation of other competent evidence to prove the existence of a foreign
law. In that case, the Supreme Court considered the testimony under oath of an attorney-at-law
of San Francisco, California, who quoted verbatim a section of California Civil Code and who
stated that the same was in force at the time the obligations were contracted, as sufficient
evidence to establish the existence of said law. Accordingly, in line with this view, the
Supreme Court in the Collector of Internal Revenue v. Fisher et al., 14upheld the Tax Court in
considering the pertinent law of California as proved by the respondents' witness. In that case,
the counsel for respondent "testified that as an active member of the California Bar since
1951, he is familiar with the revenue and taxation laws of the State of California. When asked
by the lower court to state the pertinent California law as regards exemption of intangible
personal properties, the witness cited Article 4, Sec. 13851 (a) & (b) of the California Internal
and Revenue Code as published in Derring's California Code, a publication of BancroftWhitney Co., Inc. And as part of his testimony, a full quotation of the cited section was offered
in evidence by respondents." Likewise, in several naturalization cases, it was held by the Court
that evidence of the law of a foreign country on reciprocity regarding the acquisition of
citizenship, although not meeting the prescribed rule of practice, may be allowed and used as
basis for favorable action, if, in the light of all the circumstances, the Court is "satisfied of the
authenticity of the written proof offered." 15 Thus, in, a number of decisions, mere
authentication of the Chinese Naturalization Law by the Chinese Consulate General of Manila
was held to be competent proof of that law. 16
There is, however, nothing in the testimony of Mr. Lousich that touched on the specific law of Hong Kong in
respect of service of summons either in actions in rem or in personam, and where the defendant is either a
resident or nonresident of Hong Kong. In view of the absence of proof of the Hong Kong law on this
particular issue, the presumption of identity or similarity or the so-called processual presumption shall come
into play. It will thus be presumed that the Hong Kong law on the matter is similar to the Philippine law. 17
As stated in Valmonte vs. Court of Appeals, 18 it will be helpful to determine first whether the action is in
personam, in rem, or quasi in rem because the rules on service of summons under Rule 14 of the Rules of
Court of the Philippines apply according to the nature of the action.
An action in personam is an action against a person on the basis of his personal liability. An action in rem is
an action against the thing itself instead of against the person. 19 An action quasi in rem is one wherein an
individual is named as defendant and the purpose of the proceeding is to subject his interest therein to the
obligation or lien burdening the property.20
In an action in personam, jurisdiction over the person of the defendant is necessary for the court to validly try
and decide the case. Jurisdiction over the person of a resident defendant who does not voluntarily appear in
court can be acquired by personal service of summons as provided under Section 7, Rule 14 of the Rules of
Court. If he cannot be personally served with summons within a reasonable time, substituted service may be
made in accordance with Section 8 of said Rule. If he is temporarily out of the country, any of the following
modes of service may be resorted to: (1) substituted service set forth in Section 8; 21 (2) personal service

39

outside the country, with leave of court; (3) service by publication, also with leave of court;22 or (4) any other
manner the court may deem sufficient. 23
However, in an action in personam wherein the defendant is a non-resident who does not voluntarily submit
himself to the authority of the court, personal service of summons within the state is essential to the
acquisition of jurisdiction over her person. 24 This method of service is possible if such defendant is
physically present in the country. If he is not found therein, the court cannot acquire jurisdiction over his
person and therefore cannot validly try and decide the case against him. 25 An exception was laid down
in Gemperle v. Schenker 26 wherein a non-resident was served with summons through his wife, who was a
resident of the Philippines and who was his representatives and attorney-in-fact in a prior civil case filed by
him; moreover, the second case was a mere offshoot of the first case.
On the other hand, in a proceeding in rem or quasi in rem, jurisdiction over the person of the defendant is not
a prerequisite to confer jurisdiction on the court provided that the court acquires jurisdiction over the res.
Nonetheless summons must be served upon the defendant not for the purpose of vesting the court with
jurisdiction but merely for satisfying the due process requirements. 27 Thus, where the defendant is a nonresident who is not found in the Philippines and (1) the action affects the personal status of the plaintiff; (2)
the action relates to, or the subject matter of which is property in the Philippines in which the defendant has
or claims a lien or interest; (3) the action seeks the exclusion of the defendant from any interest in the
property located in the Philippines; or (4) the property of the defendant has been attached in the Philippines
service of summons may be effected by (a) personal service out of the country, with leave of court; (b)
publication, also with leave of court, or (c) any other manner the court may deem sufficient. 28
In the case at bar, the action filed in Hong Kong against HERAS was in personam, since it was based on his
personal guarantee of the obligation of the principal debtor. Before we can apply the foregoing rules, we must
determine first whether HERAS was a resident of Hong Kong.
Fortunata de la Vega, HERAS's personal secretary in Hong Kong since 1972 until 1985, 29 testified that
HERAS was the President and part owner of a shipping company in Hong Kong during all those times that
she served as his secretary. He had in his employ a staff of twelve. 30 He had "business commitments,
undertakings, conferences, and appointments until October 1984 when [he] left Hong Kong for
good," 31 HERAS's other witness, Russel Warren Lousich, testified that he had acted as counsel for HERAS
"for a number of commercial matters." 32 ASIAVEST then infers that HERAS was a resident of Hong Kong
because he maintained a business there.
It must be noted that in his Motion to Dismiss, 33 as well as in his
Answer 34 to ASIAVEST's complaint for the enforcement of the Hong Kong court judgment, HERAS
maintained that the Hong Kong court did not have jurisdiction over him because the fundamental rule is that
jurisdiction in personam over non-resident defendants, so as to sustain a money judgment, must be based
upon personal service of summons within the state which renders the judgment. 35
For its part, ASIAVEST, in its Opposition to the Motion to Dismiss 36 contended: "The question of Hong
Kong court's 'want of jurisdiction' is therefore a triable issue if it is to be pleaded by the defendant to 'repel'
the foreign judgment. Facts showing jurisdictional lack (e.g. that the Hong Kong suit was in personam,
that defendant was not a resident of Hong Kong when the suit was filed or that he did not voluntarily submit
to the Hong Kong court's jurisdiction) should be alleged and proved by the defendant." 37
In his Reply (to the Opposition to Motion to Dismiss), 38 HERAS argued that the lack of jurisdiction over his
person was corroborated by ASIAVEST's allegation in the complaint that he "has his residence at No. 6, 1st
St., New Manila, Quezon City, Philippines." He then concluded that such judicial admission amounted to
evidence that he was and is not a resident of Hong Kong.
Significantly, in the pre-trial conference, the parties came up with stipulations of facts, among which was that
"the residence of defendant, Antonio Heras, is New Manila, Quezon City." 39
We note that the residence of HERAS insofar as the action for the enforcement of the Hong Kong court
judgment is concerned, was never in issue. He never challenged the service of summons on him through a
security guard in his Quezon City residence and through a lawyer in his office in that city. In his Motion to
Dismiss, he did not question the jurisdiction of the Philippine court over his person on the ground of invalid

40

service of summons. What was in issue was his residence as far as the Hong Kong suit was concerned. We
therefore conclude that the stipulated fact that HERAS "is a resident of New Manila, Quezon City,
Philippines" refers to his residence at the time jurisdiction over his person was being sought by the Hong
Kong court. With that stipulation of fact, ASIAVEST cannot now claim that HERAS was a resident of Hong
Kong at the time.
Accordingly, since HERAS was not a resident of Hong Kong and the action against him was, indisputably,
one in personam, summons should have been personally served on him in Hong Kong. The extraterritorial
service in the Philippines was therefore invalid and did not confer on the Hong Kong court jurisdiction over
his person. It follows that the Hong Kong court judgment cannot be given force and effect here in the
Philippines for having been rendered without jurisdiction.
Even assuming that HERAS was formerly a resident of Hong Kong, he was no longer so in November 1984
when the extraterritorial service of summons was attempted to be made on him. As declared by his secretary,
which statement was not disputed by ASIAVEST, HERAS left Hong Kong in October 1984 "for good." 40 His
absence in Hong Kong must have been the reason why summons was not served on him therein; thus,
ASIAVEST was constrained to apply for leave to effect service in the Philippines, and upon obtaining a
favorable action on the matter, it commissioned the Sycip Salazar Hernandez & Gatmaitan law firm to serve
the summons here in the Philippines.
In Brown v. Brown, 41 the defendant was previously a resident of the Philippines. Several days after a criminal
action for concubinage was filed against him, he abandoned the Philippines. Later, a proceeding quasi in
rem was instituted against him. Summons in the latter case was served on the defendant's attorney-in-fact at
the latter's address. The Court held that under the facts of the case, it could not be said that the defendant was
"still a resident of the Philippines because he ha[d] escaped to his country and [was] therefore an absentee in
the Philippines." As such, he should have been "summoned in the same manner as one who does not reside
and is not found in the Philippines."
Similarly, HERAS, who was also an absentee, should have been served with summons in the same manner as
a non-resident not found in Hong Kong. Section 17, Rule 14 of the Rules of Court providing for
extraterritorial service will not apply because the suit against him was in personam. Neither can we apply
Section 18, which allows extraterritorial service on a resident defendant who is temporarily absent from the
country, because even if HERAS be considered as a resident of Hong Kong, the undisputed fact remains that
he left Hong Kong not only "temporarily" but "for good."
IN VIEW OF ALL THE FOREGOING, judgment is hereby rendered DENYING the petition in this case and
AFFIRMING the assailed judgment of the Court of Appeals in CA-G.R. CV No. 29513.
No costs.
SO ORDERED

Asiavest Limited vs Court of Appeals


on November 21, 2012
295 SCRA 469 Conflict of Laws Private International Law Service of Summons to a Non Resident
Processual Presumption
In 1984, a Hong Kong court ordered Antonio Heras to pay US$1.8 million or its equivalent, with interest, to
Asiavest Ltd. Apparently, Heras guaranteed a certain loan in Hong Kong and the debtor in said loan defaulted
hence, the creditor, Asiavest, ran after Heras. But before said judgment was issued and even during trial,
Heras already left for good Hong Kong and he returned to the Philippines. So when in 1987, when Asiavest
filed a complaint in court seeking to enforce the foreign judgment against Heras, the latter claim that he never
received any summons, not in Hong Kong and not in the Philippines. He also claimed that he never received
a copy of the foreign judgment. Asiavest however contends that Heras was actually given service of

41

summons when a messenger from the Sycip Salazar Law Firm served said summons by leaving a copy to one
Dionisio Lopez who was Heras son in law.
ISSUE: Whether or not the foreign judgment can be enforced against Heras in the Philippines.
HELD: No. Although the foreign judgment was duly authenticated (Asiavest was able to adduce evidence in
support thereto) and Heras was never able to overcome the validity of it, it cannot be enforced against Heras
here in the Philippines because Heras was not properly served summons. Hence, as far as Philippine law is
concerned, the Hong Kong court has never acquired jurisdiction over Heras. This means then that Philippine
courts cannot act to enforce the said foreign judgment.
The action against Heras is an action in personam and as far as Hong Kong is concerned, Heras is a non
resident. He is a non resident because prior to the judgment, he already abandoned Hong Kong. The Hong
Kong law on service of summons in in personam cases against non residents was never presented in court
hence processual presumption is applied where it is now presumed that Hong Kong law in as far as this case
is concerned is the same as Philippine laws. And under our laws, in an action in personam wherein the
defendant is a non-resident who does not voluntarily submit himself to the authority of the court, personal
service of summons within the state is essential to the acquisition of jurisdiction over her person. This
method of service is possible if such defendant is physically present in the country. If he is not found therein,
the court cannot acquire jurisdiction over his person and therefore cannot validly try and decide the case
against him. Without a personal service of summons, the Hong Kong court never acquired jurisdiction.
Needless to say, the summons tendered to Lopez was an invalid service because the same does not satisfy the
requirement of personal service.

Valmonte v. CA Digest
G.R. No. 108538 January 22, 1996
Ponente: Mendoza, J.:
Service of Summons
Facts:
1.
Petitioner Lourdes A. Valmonte is a foreign resident. Petitioners Lourdes and Alfredo are
husband and wife both residents of 90222 Carkeek Drive South Seattle, Washington, U.S.A.
Petitioner Alfredo D. Valmonte, who is a member of the Philippine bar, however, practices his
profession in the Philippines, commuting for this purpose between his residence in the state of
Washington and Manila, where he holds office at S-304 Gedisco Centre, 1564 A. Mabini, Ermita,
Manila.
2.
Private respondent Rosita Dimalanta, who is the sister of petitioner filed an action for
partition against former and her husband. She alleged that, the plaintiff is of legal age, a widow and is
at present a resident of 14823 Conway Road, Chesterfield, Missouri, U.S.A., while the defendants are
spouses but, for purposes of this complaint may be served with summons at Gedisco Center, Unit 304,
1564 A. Mabini St., Ermita, Manila where defendant Alfredo D. Valmonte as defendant Lourdes
Arreola Valmontes spouse holds office and where he can be found.He husband was also her counsel,
who has a law office in the Philippines. The summons were served on her husband.
3.
Petitioner in a letter, referred private respondents counsel to her husband as the party to whom
all communications intended for her should be sent. Service of summons was then made upon

42

petitioner Alfredo at his office in Manila. Alfredo D. Valmonte accepted his summons, but not the
one for Lourdes, on the ground that he was not authorized to accept the process on her behalf.
Accordingly the process server left without leaving a copy of the summons and complaint for
petitioner Lourdes A. Valmonte.
4.
Petitioner Alfredo D. Valmonte thereafter filed his Answer with Counterclaim. Petitioner
Lourdes A. Valmonte, however, did not file her Answer. For this reason private respondent moved to
declare her in default. Petitioner Alfredo D. Valmonte entered a special appearance in behalf of his
wife and opposed the private respondents motion. RTC denied the MR of respondents. CA declared
petitioner Lourdes in default. Said decision was received by Alfredo hence this petition.
Issue: Whether or not petitioner Lourdes A. Valmonte was validly served with summons.
NO.
There was no valid service of summons on Lourdes.
1.
The action herein is in the nature of an action quasi in rem. Such an action is essentially for the purpose of
affecting the defendants interest in a specific property and not to render a judgment against him. As
petitioner Lourdes A. Valmonte is a nonresident who is not found in the Philippines, service of summons on
her must be in accordance with Rule 14, 17. Such service, to be effective outside the Philippines, must be
made either (1) by personal service; (2) by publication in a newspaper of general circulation in such places
and for such time as the court may order, in which case a copy of the summons and order of the court should
be sent by registered mail to the last known address of the defendant; or (3) in any other manner which the
court may deem sufficient.
2.

In the case at bar, the service of summons upon petitioner Lourdes A. Valmonte was not done by means of
any of the first two modes. This mode of service, like the first two, must be made outside the Philippines,
such as through the Philippine Embassy in the foreign country where the defendant resides. The service of
summons on petitioner Alfredo D. Valmonte was not made upon the order of the court as required by Rule
14, 17 and certainly was not a mode deemed sufficient by the court which in fact refused to consider the
service to be valid and on that basis declare petitioner Lourdes A. Valmonte in default for her failure to file an
answer.

3.

Secondly, the service in the attempted manner on petitioner was not made upon prior leave of the trial
court as required also in Rule 14, 17. As provided in 19, such leave must be applied for by motion in
writing, supported by affidavit of the plaintiff or some person on his behalf and setting forth the grounds for
the application.

4.

Finally, and most importantly, because there was no order granting such leave, petitioner Lourdes was not
given ample time to file her Answer which, according to the rules, shall be not less than sixty (60) days after
notice.

G.R. No. 171624

December 6, 2010

BF HOMES, INC. and the PHILIPPINE WATERWORKS AND CONSTRUCTION CORP., Petitioners,
vs.
MANILA ELECTRIC COMPANY, Respondent.
DECISION
LEONARDO-DE CASTRO, J.:
This Petition for Review on Certiorari under Rule 45 of the Rules of Court assails the Decision1 dated
October 27, 2005 of the Court of Appeals in CA-G.R. SP No. 82826, nullifying and setting aside (1) the
Order2 dated November 21, 2003 of the Regional Trial Court (RTC), Branch 202 of Las Pias City, in Civil
Case No. 03-0151, thereby dissolving the writ of injunction against respondent Manila Electric Company
(MERALCO); and (2) the Resolution3 dated February 7, 2006 of the Court of Appeals denying the Motion
for Reconsideration of petitioners BF Homes, Inc. (BF Homes) and Philippine Waterworks and Construction
Corporation (PWCC).

43

MERALCO is a corporation duly organized and existing under Philippine laws engaged in the distribution
and sale of electric power in Metro Manila. On the other hand, BF Homes and PWCC are owners and
operators of waterworks systems delivering water to over 12,000 households and commercial buildings in BF
Homes subdivisions in Paraaque City, Las Pias City, Caloocan City, and Quezon City. The water
distributed in the waterworks systems owned and operated by BF Homes and PWCC is drawn from deep
wells using pumps run by electricity supplied by MERALCO.
On June 23, 2003, BF Homes and PWCC filed a Petition [With Prayer for the Issuance of Writ of Preliminary
Injunction and for the Immediate Issuance of Restraining Order] against MERALCO before the RTC,
docketed as Civil Case No. 03-0151.
In their Petition before the RTC, BF Homes and PWCC invoked their right to refund based on the ruling of
this Court in Republic v. Manila Electric Company4:
7. It is of judicial notice that on November 15, 2002, in G.R. No. 141314, entitled Republic of the
Philippines vs. Manila Electric Company, and G.R. No. 141369, entitled Lawyers Against Monopoly
and Poverty (LAMP) et al. vs. Manila Electric Compnay (MERALCO), (both cases shall hereafter be
referred to as "MERALCO Refund cases," for brevity), the Supreme Court ordered MERALCO to
refund its customers, which shall be credited against the customers future consumption, the excess
average amount of P0.167 per kilowatt hour starting with the customers billing cycles beginning
February 1998. The dispositive portion of the Supreme Court Decision in the MERALCO Refund
cases reads:
WHEREFORE, in view of the foregoing, the instant petitions are GRANTED and the decision of the
Court of Appeals in C.A. G.R. SP No. 46888 is REVERSED. Respondent MERALCO is authorized
to adopt a rate adjustment in the amount of P0.017 kilowatthour, effective with respect to
MERALCOs billing cycles beginning February 1994. Further, in accordance with the decision of the
ERB dated February 16, 1998, the excess average amount of P0.167 per kilowatt hour starting with
the applicants billing cycles beginning February 1998 is ordered to be refunded to MERALCOs
customers or correspondingly credited in their favor for future consumption.
x x x x.
8. The Motion for Reconsideration filed by MERALCO in the MERALCO Refund cases was
DENIED WITH FINALITY (the uppercase letters were used by the Supreme Court) in the Resolution
of the Supreme Court dated April 9, 2003.
9. The amount that MERALCO was mandated to refund to [BF Homes and PWCC] pursuant to the
MERALCO Refund cases is in the amount of P11,834,570.91.5
BF Homes and PWCC then alleged in their RTC Petition that:
10. On May 20, 2003, without giving any notice whatsoever, MERALCO disconnected electric
supply to [BF Homes and PWCCs] sixteen (16) water pumps located in BF Homes in Paraaque,
Caloocan, and Quezon City, which thus disrupted water supply in those areas.
11. On June 4, 2003, [BF Homes and PWCC] received by facsimile transmission a letter from
MERALCO, x x x, in which MERALCO demanded to [BF Homes and PWCC] the payment of
electric bills amounting toP4,717,768.15.
12. [MERALCO] replied in a letter dated June 11, 2003, x x x, requesting MERALCO to apply
theP4,717,768.15 electric bill against the P11,834,570.91 that MERALCO was ordered to refund to
[BF Homes and PWCC] pursuant to the MERALCO Refund cases. x x x
13. Displaying the arrogance that has become its distinction, MERALCO, in its letter dated June 16,
2003, x x x, denied [BF Homes and PWCCs] request alleging that it has not yet come up with the
schedule for the refund of large amounts, such as those of [BF Homes and PWCC].

44

14. Even while MERALCO was serving its reply-letter to [BF Homes and PWCC], MERALCO,
again, without giving any notice, cut off power supply to [BF Homes and PWCCs] five (5) water
pumps located in BF Homes Paraaque and BF Resort Village, in Pamplona, Las Pias City.
15. In its letter dated June 4, 2003 (Annex A), MERALCO threatened to cut off electric power
connections to all of [BF Homes and PWCCs] water pumps if [BF Homes and PWCC] failed to pay
their bills demanded by MERALCO by June 20, 2003.6
BF Homes and PWCC thus cited the following causes of action for their RTC Petition:
16. In refusing to apply [MERALCOs] electric bills against the amounts that it was ordered to refund
to [BF Homes and PWCC] pursuant to the MERALCO Refund cases and in making the
implementation of the refund ordered by the Supreme Court dependent upon its own will and caprice,
MERALCO acted with utmost bad faith.
17. [BF Homes and PWCC] are clearly entitled to the remedies under the law to compel MERALCO
to consider [BF Homes and PWCCs] electric bills fully paid by the amounts which MERALCO was
ordered to refund to [BF Homes and PWCC] pursuant to the MERALCO Refund cases, to enjoin
MERALCO to reconnect electric power to all of [BF Homes and PWCCs] water pumps, and to order
MERALCO to desist from further cutting off power connection to [BF Homes and PWCCs] water
pumps.
18. MERALCOs unjust and oppressive acts have cast dishonor upon [BF Homes and PWCCs] good
name and besmirched their reputation for which [BF Homes and PWCC] should be indemnified by
way of moral damages in the amount of not less than P1,000,000.00.
19. As an example for the public good, to dissuade others from emulating MERALCOs unjust,
oppressive and mercenary conduct, MERALCO should be directed to pay [BF Homes and PWCC]
exemplary damages of at least P1,000,000.00.
20. MERALCOs oppressive and inequitable conduct forced [BF Homes and PWCC] to engage the
services of counsel to defend their rights and thereby incur litigation expenses in the amount of at
least P500,000.00 for which [BF Homes and PWCC] should be indemnified.7
BF Homes and PWCC additionally prayed that the RTC issue a writ of preliminary injunction and
restraining order considering that:
21. As indicated in its letter dated June 4, 2003 (Annex A), unless seasonably restrained, MERALCO
will cut off electric power connections to all of [BF Homes and PWCCs] water pumps on June 20,
2003.
22. Part of the reliefs herein prayed for is to restrain MERALCO from cutting off electric power
connections to [BF Homes and PWCCs] water pumps.
23. Unless MERALCOS announced intention to cut off electric power connections to [BF Homes
and PWCCs] water pumps is restrained, [BF Homes and PWCC] will suffer great and irreparable
injury because they would not [be] able to supply water to their customers.
24. [BF Homes and PWCC] therefore pray that a writ for preliminary injunction be issued upon
posting of a bond in an amount as will be determined by this Honorable Court.
25. [BF Homes and PWCC] further pray that, in the meantime and immediately upon the filing of the
above captioned Petition, a restraining order be issued before the matter of preliminary injunction can
be heard.8
On August 15, 2003, MERALCO filed before the RTC its Answer with Counterclaims and Opposition to the
Application for Writ of Preliminary Injunction9 of BF Homes and PWCC.
According to MERALCO:

45

2.2. Both petitioners BF Homes, Incorporated and Philippine Waterworks Corporation are admittedly
the registered customers of [MERALCO] by virtue of the service contracts executed between them
under which the latter undertook to supply electric energy to the former for a fee. The following
twenty-three (23) Service Identification Nos. (SINs) are registered under the name of BF Homes,
Incorporated: x x x. While the following twenty-one (21) Service Identification Nos. (SINs) are
registered under the name of Philippine Waterworks Construction Corporation: x x x
xxxx
2.4. The service contracts as well as the terms and conditions of [MERALCOs] service as approved
by BOE [Board of Energy], now ERC [Energy Regulatory Commission], provide in relevant parts,
that [BF Homes and PWCC] agree as follows:
DISCONTINUANCE OF SERVICE:
The Company reserves the right to discontinue service in case the customer is in arrears in the payment of
bills or for failure to pay the adjusted bills in those cases where the meter stopped or failed to register the
correct amount of energy consumed, or for failure to comply with any of these terms and conditions, or in
case of or to prevent fraud upon the Company. Before disconnection is made in the case of, or to prevent
fraud, the Company may adjust the bill of said customer accordingly and if the adjusted bill is not paid, the
Company may disconnect the same." (Emphasis supplied)
2.5. This contractual right of [MERALCO] to discontinue electric service for default in the payment
of its regular bills is sanctioned and approved by the rules and regulations of ERB (now the ERC).
This right is necessary and reasonable means to properly protect and enable [MERALCO] to perform
and discharge its legal and contractual obligation under its legislative franchise and the law. Cutting
off service for non-payment by the customers of the regular monthly electric bills is the only practical
way a public utility, such as [MERALCO], can ensure and maintain efficient service in accordance
with the terms and conditions of its legislative franchise and the law.
xxxx
2.14. Instead of paying their unpaid electric bills and before [MERALCO] could effect its legal and
contractual right to disconnect [BF Homes and PWCCs] electric services, [BF Homes and PWCC]
filed the instant petition to avoid payment of [MERALCOs] valid and legal claim for regular monthly
electric bills.
2.15. [BF Homes and PWCCs] unpaid regular bills totaled P6,551,969.55 covering the May and June
2003 electric bills. x x x
xxxx
2.17. [BF Homes and PWCC] knew that [MERALCO] is already in the process of implementing the
decision of the Supreme Court as to the refund case. But this refund has to be implemented in
accordance with the guidelines and schedule to be approved by the ERC. Thus [BF Homes and
PWCCs] filing of the instant petition is merely to evade payment of their unpaid electric bills to
[MERALCO].10
Hence, MERALCO sought the dismissal of the RTC Petition of BF Homes and PWCC on the following
grounds:
3.1 The Honorable Court has no jurisdiction to award the relief prayed for by [BF Homes and PWCC]
because:
a) The petition is in effect preempting or defeating the power of the ERC to implement the decision of
the Supreme Court.

46

b) [MERALCO] is a utility company whose business activity is wholly regulated by the ERC. The
latter, being the regulatory agency of the government having the authority over the respondent, is the
one tasked to approve the guidelines, schedules and details of the refund.
c) The decision of the Supreme Court, dated November 15, 2002, clearly states that respondent is
directed to make the refund to its customers in accordance with the decision of the ERC (formerly
ERB) dated February 16, 1998. Hence, [MERALCO] has to wait for the schedule and details of the
refund to be approved by the ERC before it can comply with the Supreme Court decision.
3.2. [MERALCO] has the right to disconnect the electric service to [BF Homes and PWCC] in that:
a) The service contracts between [MERALCO] and [BF Homes and PWCC] expressly authorize the
former to discontinue and disconnect electric services of the latter for their failure to pay the regular
electric bills rendered.
b) It is [MERALCOs] legal duty as a public utility to furnish its service to the general public without
arbitrary discrimination and, consequently, [MERALCO] is obligated to discontinue and disconnect
electric services to [BF Homes and PWCC] for their refusal or failure to pay the electric energy
actually used by them.11
For its compulsory counterclaims, MERALCO prayed that the RTC orders BF Homes and PWCC to pay
MERALCOP6,551,969.55 as actual damages (representing the unpaid electric bills of BF Homes and PWCC
for May and June 2003), P1,500,000.00 as exemplary damages, P1,500,000.00 as moral damages,
and P1,000,000.00 as attorneys fees.
Lastly, MERALCO opposed the application for writ of preliminary injunction of BF Homes and PWCC
because:
I
[MERALCO] HAS THE LEGAL AND CONTRACTUAL RIGHT TO DEMAND PAYMENT OF
THE ELECTRIC BILLS AND, IN CASE OF NON-PAYMENT, TO DISCONTINUE THE
ELECTRIC SERVICES OF [BF HOMES and PWCC]
II
[BF HOMES and PWCC] HAVE NO CLEAR RIGHT WHICH WARRANTS PROTECTION BY
INJUNCTIVE PROCESS
After hearing,12 the RTC issued an Order on November 21, 2003 granting the application of BF Homes and
PWCC for the issuance of a writ of preliminary injunction. The RTC found that the records showed that all
requisites for the issuance of said writ were sufficiently satisfied by BF Homes and PWCC. The RTC stated
in its Order:
Albeit, this Court respects the right of a public utility company like MERALCO, being a grantee of a
legislative franchise under Republic Act No. 9029, to collect overdue payments from its subscribers or
customers for their respective consumption of electric energy, such right must, however, succumb to the
paramount substantial and constitutional rights of the public to the usage and enjoyment of waters in their
community. Thus, there is an urgent need for the issuance of a writ of preliminary injunction in order to
prevent social unrest in the community for having been deprived of the use and enjoyment of waters flowing
through [BF Homes and PWCCs] water pumps.13
The RTC decreed in the end:
WHEREFORE, in the light of the foregoing, [BF Homes and PWCCs] prayer for the issuance of a writ of
preliminary injunction is hereby GRANTED. Respondent Manila Electric Company is permanently
restrained from proceeding with its announced intention to cut-off electric power connection to [BF Homes
and PWCCs] water pumps unless otherwise ordered by this Court. Further, [BF Homes and PWCC] are

47

hereby ordered to post a bond in the amount of P500,000 to answer for whatever injury or damage that may
be caused by reason of the preliminary injunction.14
The Motion for Reconsideration of MERALCO of the aforementioned Order was denied by the RTC in
another Order issued on January 9, 2004.15 The RTC reiterated its earlier finding that all the requisites for the
proper issuance of an injunction had been fully complied with by BF Homes and PWCC, thus:
Records indubitably show that all the requisites for the proper issuance of an injunction have been fully
complied with in the instant case.
It should be noted that a disconnection of power supply would obviously cause irreparable injury because the
pumps that supply water to the BF community will be without electricity, thereby rendering said community
without water. Water is a basic and endemic necessity of life. This is why its enjoyment and use has been
constitutionally safeguarded and protected. Likewise, a community without water might create social unrest,
which situation this Court has the mandate to prevent. There is an urgent and paramount necessity for the
issuance of the injunctive writ to prevent serious damage to the guaranteed rights of [BF Homes and PWCC]
and the residents of the community to use and enjoy water.16
The RTC resolved the issue on jurisdiction raised by MERALCO, as follows:
As to the jurisdictional issue raised by respondent MERALCO, it can be gleaned from a re-evaluation and reassessment of the records that this Court has jurisdiction to delve into the case. This Court gave both parties
the opportunity to be heard as they introduced evidence on the propriety of the issuance of the injunctive writ.
It is well-settled that no grave abuse of discretion could be attributed to its issuance where a party was not
deprived of its day in court as it was heard and had exhaustively presented all its arguments and defenses.
(National Mines and Allied Workers Union vs. Valero, 132 SCRA 578, 1984.)17
Aggrieved, MERALCO filed with the Court of Appeals a Petition for Certiorari under Rule 65 of the Rules of
Court, docketed as CA-G.R. SP No. 82826. MERALCO sought the reversal of the RTC Orders dated
November 21, 2003 and January 9, 2004 granting a writ of preliminary injunction in favor of BF Homes and
PWCC. MERALCO asserted that the RTC had no jurisdiction over the application of BF Homes and PWCC
for issuance of such a writ.
In its Decision dated October 27, 2005, the Court of Appeals agreed with MERALCO that the RTC had no
jurisdiction to issue a writ of preliminary injunction in Civil Case No. 03-0151, as said trial court had no
jurisdiction over the subject matter of the case to begin with. It ratiocinated in this wise:
For one, it cannot be gainsaid that the ERC has original and exclusive jurisdiction over the case. Explicitly,
Section 43(u) of Republic Act No. 9136, otherwise known as the "Electric Power Industry Reform Act," (RA
9136), states that the ERC shall have the original and exclusive jurisdiction over all cases contesting rates,
fees, fines and penalties imposed by the ERC in the exercise of its powers, functions and responsibilities and
over all cases involving disputes between and among participants or players in the energy sector. Section 4(o)
of Rule 3 of the Implementing Rules and Regulations of RA 9136 likewise provides that the ERC shall also
be empowered to issue such other rules that are essential in the discharge of its functions as an independent
quasi-judicial body.
For another, the respondent judge, instead of presiding over the case, should have dismissed the same and
yielded jurisdiction to the ERC pursuant to the doctrine of primary jurisdiction. It is plain error on the part of
the respondent judge to determine, preliminary or otherwise, a controversy involving a question which is
within the jurisdiction of an administrative tribunal, especially so where the question demands the exercise of
sound administrative discretion.
Needless to state, the doctrine of primary jurisdiction applies where the administrative agency, as in the case
of ERC, exercises its quasi-judicial and adjudicatory function. Thus, in cases involving specialized disputes,
the practice has been to refer the same to an administrative agency of special competence pursuant to the
doctrine of primary jurisdiction. The courts will not determine a controversy involving a question which is
within the jurisdiction of the administrative tribunal prior to the resolution of that question by the
administrative tribunal, where the question demands the exercise of sound administrative discretion requiring
the special knowledge, experience and services of the administrative tribunal to determine technical and

48

intricate matters of fact, and a uniformity of ruling is essential to comply with the premises of the regulatory
statute administered.
Verily, the cause of action of [BF Homes and PWCC] against [MERALCO] originates from the Meralco
Refund Decision as it involves the perceived right of the former to compel the latter to set-off or apply their
refund to their present electric bill. The issue delves into the right of the private respondents to collect their
refund without submitting to the approved schedule of the ERC, and in effect give unto themselves
preferential right over other equally situated consumers of [MERALCO]. Perforce, the ERC, as can be
gleaned from the afore-stated legal provisions, has primary, original and exclusive jurisdiction over the said
controversy.
Indeed, the respondent judge glaringly erred in enjoining the right of [MERALCO] to disconnect its services
to [BF Homes and PWCC] on the premise that the court has jurisdiction to apply the provisions on
compensation or set-off in this case. Although [MERALCO] recognizes the right of [BF Homes and PWCC]
to the refund as provided in the Meralco Refund Decision, it is the ERC which has the authority to implement
the same according to its approved schedule, it being a dispute arising from the exercise of its jurisdiction.
Moreover, it bears to stress that the Meralco Refund Decision was brought into fore by the Decision dated 16
February 1998 of the ERC (then Energy Regulatory Board) granting refund to [MERALCOs] consumers.
Being the agency of origin, the ERC has the jurisdiction to execute the same. Besides, as stated, it is
empowered to promulgate rules that are essential in the discharge of its functions as an independent quasijudicial body.18
The dispositive portion of the judgment of the appellate court reads:
WHEREFORE, the foregoing considered, the instant petition is hereby GRANTED and the assailed Orders
REVERSED and SET ASIDE. Accordingly, the writ of injunction against [MERALCO] is hereby
DISSOLVED. No costs.19
In a Resolution dated February 7, 2006, the Court of Appeals denied the Motion for Reconsideration of BF
Homes and PWCC for failing to raise new and persuasive and meritorious arguments.
Now, BF Homes and PWCC come before this Court via the instant Petition, raising the following assignment
of errors:
1. The Court of Appeals ERRED in saying that the respondent judge committed grave abuse of
discretion by issuing the disputed writ of injunction pending the merits of the case including the issue
of subject matter jurisdiction.
2. The Court of Appeals ERRED in saying that the ERC under the doctrine of primary jurisdiction has
the original and EXCLUSIVE jurisdiction to take cognizance of a petition for injunction to prevent
electrical disconnection to a customer entitled to a refund.
3. The Court of Appeals ERRED in NOT SAYING that the ERC as a quasi-judicial body under RA
9136 has no power to issue any injunctive relief or remedy to prevent disconnection.
4. The Court of Appeals ERRED in not resolving the issue as to the violation of MERALCO of a
standing injunction order while the case remains undecided.20
At the core of the Petition is the issue of whether jurisdiction over the subject matter of Civil Case No. 030151 lies with the RTC or the Energy Regulatory Commission (ERC). If it is with the RTC, then the said trial
court also has jurisdiction to issue the writ of preliminary injunction against MERALCO. If it is with the
ERC, then the RTC also has no jurisdiction to act on any incidents in Civil Case No. 03-0151, including the
application for issuance of a writ of preliminary injunction of BF Homes and PWCC therein.
BF Homes and PWCC argued that due to the threat of MERALCO to disconnect electric services, BF Homes
and PWCC had no other recourse but to seek an injunctive remedy from the RTC under its general
jurisdiction. The merits of Civil Case No. 03-0151 was not yet in issue, only the propriety of issuing a writ of
preliminary injunction to prevent an irreparable injury. Even granting that the RTC has no jurisdiction over

49

the subject matter of Civil Case No. 03-0151, the ERC by enabling law has no injunctive power to prevent
the disconnection by MERALCO of electric services to BF Homes and PWCC.
The Petition has no merit.
Settled is the rule that jurisdiction is conferred only by the Constitution or the law.21 Republic v. Court of
Appeals22 also enunciated that only a statute can confer jurisdiction on courts and administrative agencies.
Related to the foregoing and equally well-settled is the rule that the nature of an action and the subject matter
thereof, as well as which court or agency of the government has jurisdiction over the same, are determined by
the material allegations of the complaint in relation to the law involved and the character of the reliefs prayed
for, whether or not the complainant/plaintiff is entitled to any or all of such reliefs. A prayer or demand for
relief is not part of the petition of the cause of action; nor does it enlarge the cause of action stated or change
the legal effect of what is alleged. In determining which body has jurisdiction over a case, the better policy is
to consider not only the status or relationship of the parties but also the nature of the action that is the subject
of their controversy.23
In Manila Electric Company v. Energy Regulatory Board,24 the Court traced the legislative history of the
regulatory agencies which preceded the ERC, presenting a summary of these agencies, the statutes or
issuances that created them, and the extent of the jurisdiction conferred upon them, viz:
1. The first regulatory body, the Board of Rate Regulation (BRR), was created by virtue of Act No.
1779. Its regulatory mandate under Section 5 of the law was limited to fixing or regulating rates of
every public service corporation.
2. In 1913, Act No. 2307 created the Board of Public Utility Commissioners (BPUC) to take over the
functions of the BRR. By express provision of Act No. 2307, the BPUC was vested with jurisdiction,
supervision and control over all public utilities and their properties and franchises.
3. On November 7, 1936, Commonwealth Act (C.A.) No. 146, or the Public Service Act (PSA), was
passed creating the Public Service Commission (PSC) to replace the BPUC. Like the BPUC, the PSC
was expressly granted jurisdiction, supervision and control over public services, with the concomitant
authority of calling on the public force to exercise its power, to wit:
"SEC. 13. Except as otherwise provided herein, the Commission shall have general supervision and
regulation of, jurisdiction and control over, all public utilities, and also over their property, property rights,
equipment, facilities and franchises so far as may be necessary for the purpose of carrying out the provisions
of this Act, and in the exercise of its authority it shall have the necessary powers and the aid of the public
force x x x."
Section 14 of C.A. No. 146 defines the term "public service" or "public utility" as including "every
individual, copartnership, association, corporation or joint-stock company, . . . that now or hereafter may
own, operate, manage or control within the Philippines, for hire or compensation, any common carrier, x x x,
electric light, heat, power, x x x, when owned, operated and managed for public use or service within the
Philippines x x x." Under the succeeding Section 17(a), the PSC has the power even without prior hearing
(a) To investigate, upon its own initiative, or upon complaint in writing, any matter concerning any public
service as regards matters under its jurisdiction; to require any public service to furnish safe, adequate and
proper service as the public interest may require and warrant, to enforce compliance with any standard, rule,
regulation, order or other requirement of this Act or of the Commission, x x x.
4. Then came Presidential Decree (P.D.) No. 1, reorganizing the national government and implementing the
Integrated Reorganization Plan. Under the reorganization plan, jurisdiction, supervision and control over
public services related to electric light, and power heretofore vested in the PSC were transferred to the Board
of Power and Waterworks (BOPW).
Later, P.D. No. 1206 abolished the BOPW. Its powers and function relative to power utilities, including its
authority to grant provisional relief, were transferred to the newly-created Board of Energy (BOE).

50

5. On May 8, 1987, then President Corazon C. Aquino issued E.O. No. 172 reconstituting the BOE into the
ERB, transferring the formers functions and powers under P.D. No. 1206 to the latter and consolidating in
and entrusting on the ERB "all the regulatory and adjudicatory functions covering the energy sector." Section
14 of E.O. No. 172 states that "(T)he applicable provisions of [C.A.] No. 146, as amended, otherwise known
as the Public Service Act; x x x and [P.D.] No. 1206, as amended, creating the Department of Energy, shall
continue to have full force and effect, except insofar as inconsistent with this Order."25
Thereafter, on June 8, 2001, Republic Act No. 9136, known as the Electric Power Industry Reform Act of
2001 (EPIRA), was enacted, providing a framework for restructuring the electric power industry. One of the
avowed purposes of the EPIRA is to establish a strong and purely independent regulatory body. The Energy
Regulatory Board (ERB) was abolished and its powers and functions not inconsistent with the provision of
the EPIRA were expressly transferred to the ERC.26
The powers and functions of the ERB not inconsistent with the EPIRA were transferred to the ERC by virtue
of Sections 44 and 80 of the EPIRA, which read:
Sec. 44. Transfer of Powers and Functions. The powers and functions of the Energy Regulatory Board not
inconsistent with the provisions of this Act are hereby transferred to the ERC. The foregoing transfer of
powers and functions shall include all applicable funds and appropriations, records, equipment, property and
personnel as may be necessary.
Sec. 80. Applicability and Repealing Clause. The applicability provisions of Commonwealth Act No. 146,
as amended, otherwise known as the "Public Service Act." Republic Act 6395, as amended, revising the
charter of NPC; Presidential Decree 269, as amended, referred to as the National Electrification Decree;
Republic Act 7638, otherwise known as the "Department of Energy Act of 1992"; Executive Order 172, as
amended, creating the ERB; Republic Act 7832 otherwise known as the "Anti-Electricity and Electric
Transmission Lines/Materials Pilferage Act of 1994"; shall continue to have full force and effect except
insofar as they are inconsistent with this Act.
The provisions with respect to electric power of Section 11(c) of Republic Act 7916, as amended, and Section
5(f) of Republic Act 7227, are hereby repealed or modified accordingly.
Presidential Decree No. 40 and all laws, decrees, rules and regulations, or portions thereof, inconsistent with
this Act are hereby repealed or modified accordingly.
In addition to the foregoing, the EPIRA also conferred new powers upon the ERC under Section 43, among
which are:
SEC. 43. Functions of the ERC. The ERC shall promote competition, encourage market development,
ensure customer choice and penalize abuse of market power in the restructured electricity industry. In
appropriate cases, the ERC is authorized to issue cease and desist order after due notice and hearing. Towards
this end, it shall be responsible for the following key functions in the restructured industry:
xxxx
(f) In the public interest, establish and enforce a methodology for setting transmission and distribution
wheeling rates and retail rates for the captive market of a distribution utility, taking into account all relevant
considerations, including the efficiency or inefficiency of the regulated entities. The rates must be such as to
allow the recovery of just and reasonable costs and a reasonable return on rate base (RORB) to enable the
entity to operate viably. The ERC may adopt alternative forms of internationally-accepted rate-setting
methodology as it may deem appropriate. The rate-setting methodology so adopted and applied must ensure a
reasonable price of electricity. The rates prescribed shall be non-discriminatory. To achieve this objective and
to ensure the complete removal of cross subsidies, the cap on the recoverable rate of system losses prescribed
in Section 10 of Republic Act No. 7832, is hereby amended and shall be replaced by caps which shall be
determined by the ERC based on load density, sales mix, cost of service, delivery voltage and other technical
considerations it may promulgate. The ERC shall determine such form of rate-setting methodology, which
shall promote efficiency. x x x.
xxxx

51

(u) The ERC shall have the original and exclusive jurisdiction over all cases contesting rates, fees, fines and
penalties imposed by the ERC in the exercise of the abovementioned powers, functions and responsibilities
and over all cases involving disputes between and among participants or players in the energy sector.
All notices of hearings to be conducted by the ERC for the purpose of fixing rates or fees shall be published
at least twice for two successive weeks in two (2) newspapers of nationwide circulation.
A careful review of the material allegations of BF Homes and PWCC in their Petition before the RTC reveals
that the very subject matter thereof is the off-setting of the amount of refund they are supposed to receive
from MERALCO against the electric bills they are to pay to the same company. This is squarely within the
primary jurisdiction of the ERC.
The right of BF Homes and PWCC to refund, on which their claim for off-setting depends, originated from
the MERALCO Refund cases. In said cases, the Court (1) authorized MERALCO to adopt a rate adjustment
in the amount of P0.017 per kilowatthour, effective with respect to its billing cycles beginning February
1994; and (2) ordered MERALCO to refund to its customers or credit in said customers favor for future
consumption P0.167 per kilowatthour, starting with the customers billing cycles that begin February 1998, in
accordance with the ERB Decision dated February 16, 1998.
It bears to stress that in the MERALCO Refund cases, this Court only affirmed the February 16, 1998
Decision of the ERB (predecessor of the ERC) fixing the just and reasonable rate for the electric services of
MERALCO and granting refund to MERALCO consumers of the amount they overpaid. Said Decision was
rendered by the ERB in the exercise of its jurisdiction to determine and fix the just and reasonable rate of
power utilities such as MERALCO.
Presently, the ERC has original and exclusive jurisdiction under Rule 43(u) of the EPIRA over all cases
contesting rates, fees, fines, and penalties imposed by the ERC in the exercise of its powers, functions and
responsibilities, and over all cases involving disputes between and among participants or players in the
energy sector. Section 4(o) of the EPIRA Implementing Rules and Regulation provides that the ERC "shall
also be empowered to issue such other rules that are essential in the discharge of its functions as in
independent quasi-judicial body."
Indubitably, the ERC is the regulatory agency of the government having the authority and supervision over
MERALCO. Thus, the task to approve the guidelines, schedules, and details of the refund by MERALCO to
its consumers, to implement the judgment of this Court in the MERALCO Refund cases, also falls upon the
ERC. By filing their Petition before the RTC, BF Homes and PWCC intend to collect their refund without
submitting to the approved schedule of the ERC, and in effect, enjoy preferential right over the other equally
situated MERALCO consumers.
Administrative agencies, like the ERC, are tribunals of limited jurisdiction and, as such, could wield only
such as are specifically granted to them by the enabling statutes. In relation thereto is the doctrine of primary
jurisdiction involving matters that demand the special competence of administrative agencies even if the
question involved is also judicial in nature. Courts cannot and will not resolve a controversy involving a
question within the jurisdiction of an administrative tribunal, especially when the question demands the
sound exercise of administrative discretion requiring special knowledge, experience and services of the
administrative tribunal to determine technical and intricate matters of fact. The court cannot arrogate into
itself the authority to resolve a controversy, the jurisdiction of which is initially lodged with the
administrative body of special competence.27
Since the RTC had no jurisdiction over the Petition of BF Homes and PWCC in Civil Case No. 03-0151, then
it was also devoid of any authority to act on the application of BF Homes and PWCC for the issuance of a
writ of preliminary injunction contained in the same Petition. The ancillary and provisional remedy of
preliminary injunction cannot exist except only as an incident of an independent action or proceeding.28
Incidentally, BF Homes and PWCC seemed to have lost sight of Section 8 of Executive Order No. 172 which
explicitly vested on the ERB, as an incident of its principal function, the authority to grant provisional relief,
thus:

52

Section 8. Authority to Grant Provisional Relief. The Board may, upon the filing of an application, petition
or complaint or at any stage thereafter and without prior hearing, on the basis of supporting papers duly
verified or authenticated, grant provisional relief on motion of a party in the case or on its own initiative,
without prejudice to a final decision after hearing, should the Board find that the pleadings, together with
such affidavits, documents and other evidence which may be submitted in support of the motion,
substantially support the provisional order:Provided, That the Board shall immediately schedule and conduct
a hearing thereon within thirty (30) days thereafter, upon publication and notice to all affected parties.
The aforequoted provision is still applicable to the ERC as it succeeded the ERB, by virtue of Section 80 of
the EPIRA. A writ of preliminary injunction is one such provisional relief which a party in a case before the
ERC may move for.
Lastly, the Court herein already declared that the RTC not only lacked the jurisdiction to issue the writ of
preliminary injunction against MERALCO, but that the RTC actually had no jurisdiction at all over the
subject matter of the Petition of BF Homes and PWCC in Civil Case No. 03-0151. Therefore, in addition to
the dissolution of the writ of preliminary injunction issued by the RTC, the Court also deems it appropriate to
already order the dismissal of the Petition of BF Homes and PWCC in Civil Case No. 03-0151 for lack of
jurisdiction of the RTC over the subject matter of the same. Although only the matter of the writ of
preliminary injunction was brought before this Court in the instant Petition, the Court is already taking
cognizance of the issue on the jurisdiction of the RTC over the subject matter of the Petition. The Court may
motu proprio consider the issue of jurisdiction. The Court has discretion to determine whether the RTC
validly acquired jurisdiction over Civil Case No. 03-0151 since, to reiterate, jurisdiction over the subject
matter is conferred only by law. Jurisdiction over the subject matter cannot be acquired through, or waived
by, any act or omission of the parties. Neither would the active participation of the parties nor estoppel
operate to confer jurisdiction on the RTC where the latter has none over a cause of action.29Indeed, when a
court has no jurisdiction over the subject matter, the only power it has is to dismiss the action.30
WHEREFORE, the instant Petition for Review is DENIED. The Decision dated October 27, 2005 of the
Court of Appeals in CA-G.R. SP No. 82826 is AFFIRMED with the MODIFICATION that the Regional Trial
Court, Branch 202 of Las Pias City, is ORDERED to dismiss the Petition [With Prayer for the Issuance of
Writ of Preliminary Injunction and for the Immediate Issuance of Restraining Order] of BF Homes, Inc. and
Philippine Waterworks and Construction Corporation in Civil Case No. 03-0151. Costs against BF Homes,
Inc. and Philippine Waterworks and Construction Corporation.
SO ORDERED.

G.R. No. 162416

January 31, 2006

CHESTER DE JOYA, Petitioner,


vs.
JUDGE PLACIDO C. MARQUEZ, in his capacity as Presiding Judge of Branch 40, Manila-RTC, PEOPLE
OF THE PHILIPPINES and THE SECRETARY OF THE DEPARTMENT OF JUSTICE, Respondents.
DECISION
AZCUNA, J.:
This is a petition for certiorari and prohibition that seeks the Court to nullify and set aside the warrant of
arrest issued by respondent judge against petitioner in Criminal Case No. 03-219952 for violation of Article
315, par. 2(a) of the Revised Penal Code in relation to Presidential Decree (P.D.) No. 1689. Petitioner asserts
that respondent judge erred in finding the existence of probable cause that justifies the issuance of a warrant
of arrest against him and his co-accused.
Section 6, Rule 112 of the Revised Rules of Criminal Procedure provides:

53

Sec. 6. When warrant of arrest may issue. (a) By the Regional Trial Court. Within ten (10) days from the
filing of the complaint or information, the judge shall personally evaluate the resolution of the prosecutor and
its supporting evidence. He may immediately dismiss the case if the evidence on record clearly fails to
establish probable cause. If he finds probable cause, he shall issue a warrant of arrest, or a commitment order
if the accused has already been arrested pursuant to a warrant issued by the judge who conducted the
preliminary investigation or when the complaint or information was filed pursuant to section 7 of this Rule.
In case of doubt on the existence of probable cause, the judge may order the prosecutor to present additional
evidence within five (5) days from notice and the issuance must be resolved by the court within thirty (30)
days from the filing of the complaint or information.
x x x1
This Court finds from the records of Criminal Case No. 03-219952 the following documents to support the
motion of the prosecution for the issuance of a warrant of arrest:
1. The report of the National Bureau of Investigation to Chief State Prosecutor Jovencito R. Zuo as
regards their investigation on the complaint filed by private complainant Manuel Dy Awiten against
Mina Tan Hao @ Ma. Gracia Tan Hao and Victor Ngo y Tan for syndicated estafa. The report shows
that Hao induced Dy to invest more than a hundred million pesos in State Resources Development
Management Corporation, but when the latters investments fell due, the checks issued by Hao in
favor of Dy as payment for his investments were dishonored for being drawn against insufficient
funds or that the account was closed.2
2. Affidavit-Complaint of private complainant Manuel Dy Awiten.3
3. Copies of the checks issued by private complainant in favor of State Resources Corporation.4
4. Copies of the checks issued to private complainant representing the supposed return of his
investments in State Resources.5
5. Demand letter sent by private complainant to Ma. Gracia Tan Hao.6
6. Supplemental Affidavit of private complainant to include the incorporators and members of the
board of directors of State Resources Development Management Corporation as participants in the
conspiracy to commit the crime of syndicated estafa. Among those included was petitioner Chester De
Joya.7
7. Counter-Affidavits of Chester De Joya and the other accused, Ma. Gracia Hao and Danny S. Hao.
Also included in the records are the resolution issued by State Prosecutor Benny Nicdao finding probable
cause to indict petitioner and his other co-accused for syndicated estafa,8 and a copy of the Articles of
Incorporation of State Resources Development Management Corporation naming petitioner as incorporator
and director of said corporation.
This Court finds that these documents sufficiently establish the existence of probable cause as required under
Section 6, Rule 112 of the Revised Rules of Criminal Procedure. Probable cause to issue a warrant of arrest
pertains to facts and circumstances which would lead a reasonably discreet and prudent person to believe that
an offense has been committed by the person sought to be arrested. It bears remembering that "in determining
probable cause, the average man weighs facts and circumstances without resorting to the calibrations of our
technical rules of evidence of which his knowledge is nil. Rather, he relies on the calculus of common sense
of which all reasonable men have an abundance."9 Thus, the standard used for the issuance of a warrant of
arrest is less stringent than that used for establishing the guilt of the accused. As long as the evidence
presented shows aprima facie case against the accused, the trial court judge has sufficient ground to issue a
warrant of arrest against him.
The foregoing documents found in the records and examined by respondent judge tend to show that therein
private complainant was enticed to invest a large sum of money in State Resources Development
Management Corporation; that he issued several checks amounting to P114,286,086.14 in favor of the
corporation; that the corporation, in turn, issued several checks to private complainant, purportedly

54

representing the return of his investments; that said checks were later dishonored for insufficient funds and
closed account; that petitioner and his co-accused, being incorporators and directors of the corporation, had
knowledge of its activities and transactions. These are all that need to be shown to establish probable cause
for the purpose of issuing a warrant of arrest. It need not be shown that the accused are indeed guilty of the
crime charged. That matter should be left to the trial. It should be emphasized that before issuing warrants of
arrest, judges merely determine personally the probability, not the certainty, of guilt of an accused. Hence,
judges do not conduct a de novo hearing to determine the existence of probable cause. They just personally
review the initial determination of the prosecutor finding a probable cause to see if it is supported by
substantial evidence.10 In case of doubt on the existence of probable cause, the Rules allow the judge to order
the prosecutor to present additional evidence. In the present case, it is notable that the resolution issued by
State Prosecutor Benny Nicdao thoroughly explains the bases for his findings that there is probable cause to
charge all the accused with violation of Article 315, par. 2(a) of the Revised Penal Code in relation to P.D.
No. 1689.
The general rule is that this Court does not review the factual findings of the trial court, which include the
determination of probable cause for the issuance of warrant of arrest. It is only in exceptional cases where
this Court sets aside the conclusions of the prosecutor and the trial judge on the existence of probable cause,
that is, when it is necessary to prevent the misuse of the strong arm of the law or to protect the orderly
administration of justice. The facts obtaining in this case do not warrant the application of the
exception.lavvph!l.ne+
In addition, it may not be amiss to note that petitioner is not entitled to seek relief from this Court nor from
the trial court as he continuously refuses to surrender and submit to the courts jurisdiction. Justice Florenz D.
Regalado explains the requisites for the exercise of jurisdiction and how the court acquires such jurisdiction,
thus:
x x x Requisites for the exercise of jurisdiction and how the court acquires such jurisdiction:
a. Jurisdiction over the plaintiff or petitioner: This is acquired by the filing of the complaint, petition
or initiatory pleading before the court by the plaintiff or petitioner.
b. Jurisdiction over the defendant or respondent: This is acquired by the voluntary appearance or
submission by the defendant or respondent to the court or by coercive process issued by the court to
him, generally by the service of summons.
c. Jurisdiction over the subject matter: This is conferred by law and, unlike jurisdiction over the
parties, cannot be conferred on the court by the voluntary act or agreement of the parties.
d. Jurisdiction over the issues of the case: This is determined and conferred by the pleadings filed in
the case by the parties, or by their agreement in a pre-trial order or stipulation, or, at times by their
implied consent as by the failure of a party to object to evidence on an issue not covered by the
pleadings, as provided in Sec. 5, Rule 10.
e. Jurisdiction over the res (or the property or thing which is the subject of the litigation). This is
acquired by the actual or constructive seizure by the court of the thing in question, thus placing it
in custodia legis, as in attachment or garnishment; or by provision of law which recognizes in the
court the power to deal with the property or subject matter within its territorial jurisdiction, as in land
registration proceedings or suits involving civil status or real property in the Philippines of a nonresident defendant.
Justice Regalado continues to explain:
In two cases, the court acquires jurisdiction to try the case, even if it has not acquired jurisdiction over the
person of a nonresident defendant, as long as it has jurisdiction over the res, as when the action involves the
personal status of the plaintiff or property in the Philippines in which the defendant claims an interest. In such
cases, the service of summons by publication and notice to the defendant is merely to comply with due
process requirements. Under Sec. 133 of the Corporation Code, while a foreign corporation doing business in
the Philippines without a license cannot sue or intervene in any action here, it may be sued or proceeded
against before our courts or administrative tribunals.11

55

Again, there is no exceptional reason in this case to allow petitioner to obtain relief from the courts without
submitting to its jurisdiction. On the contrary, his continued refusal to submit to the courts jurisdiction
should give this Court more reason to uphold the action of the respondent judge. The purpose of a warrant of
arrest is to place the accused under the custody of the law to hold him for trial of the charges against him. His
evasive stance shows an intent to circumvent and frustrate the object of this legal process. It should be
remembered that he who invokes the courts jurisdiction must first submit to its jurisdiction.
WHEREFORE, the petition is DISMISSED.
No costs.
SO ORDERED.

G.R. No. 161034

June 30, 2009

ZENAIDA ACOSTA, EDUARDO ACOSTA, ARNOLD ACOSTA, DELIA ACOSTA, SPS. TEODULO
MACHADO AND AURORA ORENZA, SPS. ROLDAN PALARCA AND PACITA PANGILINAN, SPS.
FROMENCIO JONATAS AND LUCENA M. MARIANO, SPS. MARCIAL IGLESIA AND VIRGINIA
LAPURGA, ATTY.-IN-FACT FELINO MACARAEG, SPS. MANUEL MANGROBANG AND
VALERIANA SOTIO, SPS. VIRGINIA DELA ROSA AND ROMEO DELA ROSA, SPS. PACIFICO
SOTIO AND LOLITA SORIANO, JUAN DALINOC (DECEASED), REPRESENTED BY DAUGHTER
CONSUELO DALINOC, SPS. MARIANO TORIO AND MAXIMA MACARAEG, REPRESENTED BY
LEGAL HEIRS TORIBIA TORIO AND MAYUMI MACARAEG, TEOFILO MOLINA AND AVELINO
DIZON, Petitioners,
vs.
TRINIDAD SALAZAR AND ANICETA SALAZAR, Respondents.
DECISION
NACHURA, J.:
This is a petition for review on certiorari assailing the July 25, 2003 Decision1 of the Court of Appeals (CA)
as well as its November 25, 2003 Resolution2 in CA-G.R. CV No. 70161, which reversed and set aside the
December 20, 2000 Decision3 of the Regional Trial Court (RTC), Branch 64, Tarlac City in Civil Case No.
7256. Said RTC decision dismissed the complaint for quieting of title filed by herein respondents Trinidad
Salazar and Aniceta Salazar against petitioners.
Below are the facts.
On November 19, 1985, respondents Trinidad and Aniceta Salazar (hereinafter, Salazars), filed a petition for
the cancellation of the entries annotated at the back of Original Certificate of Title (OCT) No. 40287
registered in the names of spouses Juan Soriano and Vicenta Macaraeg, who died without issue.4 The Salazars
claim that two of the entries Entry Nos. 19756 and 20102 annotated at the back of the aforesaid title are
void since no consolidation of rights appear in the Registry of Deeds (RD) of Tarlac to support the entries;
and that Transfer Certificate of Title (TCT) No. 9297, which supposedly cancelled OCT No. 40287, is nonexistent according to a certification issued by the RD.5 On October 21, 1986, RTC Branch 63 of Tarlac
resolved to grant the petition and ordered the cancellation of Entry No. 20102.6 No respondent was impleaded
in the said petition.
Subsequently, the Salazars filed an urgent motion praying for the issuance of an order to direct the RD of
Tarlac to recall all titles issued under Entry Nos. 19756 and 20102 and to cancel all the tax declarations
issued based thereon. The motion was granted in an Order issued on November 7, 1986.7
On November 20, 1986, the Salazars filed a second urgent motion praying that the owners of the affected
property be ordered to appear before the court to show cause why their titles should not be cancelled.8

56

On October 20, 1987, the Salazars filed a new motion praying that the RD of Tarlac be ordered to comply
with the courts order issued on November 7, 1986. The RD, however, explained that to comply with the said
court order would remove the basis for the issuance of TCT No. 9297 which title had, in turn, been cancelled
by many other transfer certificates of title and would indubitably result in the deprivation of the right to due
process of the registered owners thereof.9 On this basis, the RTC denied the motion and advised the Salazars
to elevate the matter en consulta to the Land Registration Commission (now Land Registration Authority or
LRA). After the Salazars moved for reconsideration, the RTC directed the RD of Tarlac to comply with the
October 21, 1986 and November 7, 1986 orders. Threatened with contempt, the RD elevated the matter en
consulta to the National Land Titles and Deeds Registration Administration, which, in turn, issued a
resolution directing the RD to comply with the RTCs orders.10 On March 7, 1989, OCT No. 40287 was
reconstituted and TCT No. 219121 was issued in the names of the Salazars, sans Entry Nos. 19756 and
20102.
It was at this stage of the proceedings that herein petitioners together with other subsequent purchasers for
value of the disputed property twenty-seven (27) titleholders in all11 filed their formal written comment
dated April 17, 1989.12 In their comment, the oppositors contended, among others, that they had acquired
their titles in good faith and for value, and that the lower court, acting as a land registration court, had no
jurisdiction over issues of ownership.13
On September 14, 1989, the said court, apparently realizing its mistake, issued an Order, stating thus:
Upon motion of Atty. Alcantara and without objection on the part of Atty. Molina and Atty. Lamorena, all the
incidents in this case are hereby withdrawn without prejudice to the filing of an appropriate action in a proper
forum.
SO ORDERED.14
This prompted the Salazars to file a complaint for quieting of title impleading herein petitioners as well as
other individuals who claim to have purchased the said property from the heirs of Juan Soriano. The case was
docketed as Civil Case No. 7256 before Branch 64 of the RTC of Tarlac.15 The complaint alleged that TCT
No. 219121 was issued in the names of the Salazars without Entry Nos. 19756 and 20102 at the back of said
title, but the previous TCTs issued by the RD of Tarlac as well as the tax declarations existing in the
Assessors Office have not been cancelled and revoked by the said government agencies to the detriment and
prejudice of the complainants (herein respondents). They also alleged that Pcs-395, from which Lot Nos.
702-A to 702-V were taken, is non-existent and, thus, the court should cause the cancellation and revocation
of spurious and null and void titles and tax declarations.16
Defendants filed three separate answers. Defendants Raymundo Macaraeg, Martha Estacio (both deceased),
Adelaida Macaraeg, Lucio Macaraeg, represented by Eufracia Macaraeg Baluyot as attorney-in-fact,
Gregorio Baluyut and Eligia Obcena (hereinafter, Macaraegs) maintained that the November 7, 1986 order of
the RTC is null and void because the court did not acquire jurisdiction over the case. They also argued that
TCT No. 219121 issued in the name of the Salazars is void and that the case for quieting of title is not a
direct, but a collateral, attack against a property covered by a Torrens certificate.17
Defendants, now herein petitioners, for their part, maintained that the Plan of Consolidation Subdivision
Survey Pcs-396 had been an existing consolidation-subdivision survey plan annotated on OCT No. 40287
under Entry No. 20102 dated February 17, 1950 from which TCT No. 9297 was issued covering Lot Nos.
702-A to 702-V, inclusive, in the names of the heirs of Juan Soriano. They argued that TCT No. 219121
issued in the name of the Salazars is spurious and null and void from the beginning since it was acquired
pursuant to an illegal order issued by the court.18 By way of special and affirmative defenses, they also
alleged, among others, (1) that the Salazars were not among the heirs of the late Juan Soriano, not within the
fifth civil degree of consanguinity, and hence, they have no right to inherit; (2) that TCT No. 219121
constitutes a cloud upon the Torrens title of herein petitioners, and should therefore be cancelled and revoked;
(3) that assuming, without admitting, that the Salazars have any right over the lots in question their right to
enforce such action had already prescribed by laches or had been barred by prescription since more than forty
(40) years had lapsed since the heirs of Juan Soriano had registered the lots in question under TCT No. 9297
on February 17, 1950; and (4) that petitioners and/or their predecessors-in-interest acquired the lots in
question in good faith and for value from the registered owners thereof.19

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Defendant spouses Francisco Jonatas and Lucena M. Mariano and spouses Manuel Mangrobang and
Valeriana Sotio filed their answers practically raising the same defenses.20
Meanwhile, on July 29, 1991, petitioners, together with the Macaraegs and Jonatas, et al., filed before the CA
a petition for annulment of judgment21 rendered by RTC Branch 63 of Tarlac, Tarlac. The case, docketed as
CA-G.R. SP No. 25643, was, however, dismissed on the ground of litis pendencia.22
On December 20, 2000, Branch 64 of the RTC of Tarlac dismissed the complaint for quieting of title. The
trial court faulted the Salazars for failure to present proof that they are heirs of the late Juan Soriano.23 It also
declared TCT No. 219121 issued in the name of the Salazars as null and void, and affirmed TCT No. 9297 as
well as all certificates of title derived therefrom.24
Unsatisfied, the Salazars appealed to the CA,25 which ruled in their favor.
According to the CA, it was erroneous for Branch 64 of the RTC of Tarlac to reverse and declare as null and
void the decision of Branch 63, which is a court of equal rank. Such issue should have been properly
ventilated in an action for annulment of final judgment. Consequently, the orders issued by RTC Branch 63,
had become final and executory, hence, covered by res judicata.26
The CA also struck down the arguments raised by the appellees that the orders of RTC Branch 63 are null and
void for lack of proper notice. It ratiocinated that the proceeding is a land registration proceeding, which is an
action in rem. This being so, personal notice to the owners or claimants of the land sought to be registered is
not necessary in order to vest the court with jurisdiction over the res and over the parties.27
A motion for reconsideration28 was filed, but the same was denied.29 Hence, this petition.
Pivotal to the resolution of this case is the determination of the validity of the action taken by the Salazars in
Branch 63 of the RTC of Tarlac.
We rule for petitioners.
It is true that the registration of land under the Torrens system is a proceeding in rem and not in personam.
Such a proceeding in rem, dealing with a tangible res, may be instituted and carried to judgment without
personal service upon the claimants within the state or notice by mail to those outside of it. Jurisdiction is
acquired by virtue of the power of the court over the res. Such a proceeding would be impossible were this
not so, for it would hardly do to make a distinction between constitutional rights of claimants who were
known and those who were not known to the plaintiff, when the proceeding is to bar all.30
Interestingly, however, the proceedings instituted by the Salazars both in Branch 63 of the RTC of Tarlac
for the cancellation of entries in OCT No. 40287 and later in Branch 64 of the RTC of Tarlac for quieting of
title can hardly be classified as actions in rem. The petition for cancellation of entries annotated at the back
of OCT No. 40287 ought to have been directed against specific persons: namely, the heirs of Juan Soriano as
appearing in Entry No. 20102 and, indubitably, against their successors-in-interest who have acquired
different portions of the property over the years because it is in the nature of an action quasi in rem.
Accordingly, the Salazars should have impleaded as party defendants the heirs of Juan Soriano and/or Vicenta
Macaraeg as well as those claiming ownership over the property under their names because they are
indispensable parties. This was not done in this case.31 Since no indispensable party was ever impleaded by
the Salazars in their petition for cancellation of entry filed before Branch 63 of the RTC of Tarlac, herein
petitioners are not bound by the dispositions of the said court.32 Consequently, the judgment or order of the
said court never even acquired finality.
Apparently realizing their mistake, the Salazars later on filed an action for quieting of title, also an action
quasi in rem, albeit this time before Branch 64 of the RTC of Tarlac. Because the Salazars miserably failed to
prove the basis for their claim, the RTC dismissed the complaint.33 In fact, the RTC was bold enough to have
pronounced thus:
Who are the heirs of Juan Soriano who caused the consolidation and in whose favor TCT No. 9297 was
issued? Certainly, they are not the plaintiffs. If the plaintiffs claim that they are the only heirs, they should file
a case against those who executed the consolidation in whose favor [E]ntry [N]o. 20102 was made.

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x x x In its order dated February 24, 2000, this Court ruled that it is necessary that plaintiffs should prove that
they are the heirs of Juan Soriano, the registered owners as indicated in OCT No. 40287 of (sic) Vicenta
Macaraeg, the late spouse. Despite the cue, the plaintiffs opted not to present evidence on how they became
the heirs of Juan Soriano or Vicenta Macaraeg. There being [no] evidence presented to prove that plaintiffs
are the heirs of the late Juan Soriano and Vicenta Macaraeg, they had no right and cause of action to
prosecute this case.34
Needless to say, the failure of the Salazars to implead indispensable party defendants in the petition for
cancellation of entries in OCT No. 40287 should have been a ground for the RTC to dismiss, or at least
suspend, the proceedings of the case.35 Yet, although the action proceeded, any judgment or order issued by
the court thereon is still null and void for want of authority on the part of the court to act with respect to the
parties never impleaded in the action.36 Thus, the orders issued by said court dated October 21, 1986 and
November 7, 1986 never acquired finality.37 Quod ab initio non valet, in tractu temporis non convalescit.38
Paraphrasing by analogy this Courts ruling in Metropolitan Waterworks & Sewerage System v. Sison,39 a void
order is not entitled to the respect accorded to a valid order. It may be entirely disregarded or declared
inoperative by any tribunal in which effect is sought to be given to it. It has no legal or binding effect or
efficacy for any purpose or at any place and thus cannot affect, impair or create rights. It is not entitled to
enforcement and is, ordinarily, no protection to those who seek to enforce the same. Accordingly, all
proceedings founded on the void court order are themselves regarded as invalid, and the situation is the same
as it would be if there was no order issued by the court. It leaves the party litigants in the same position they
were in before the trial.40 A void order, like any void judgment, may be said to be a lawless thing which can
be treated as an outlaw and slain at sight.41
More crucial is the fact that both parties in this case are dealing with property registered under the Torrens
system. To allow any individual, such as the Salazars in this case, to impugn the validity of a Torrens
certificate of title by the simple expediency of filing an ex parte petition for cancellation of entries would
inevitably erode the very reason why the Torrens system was adopted in this country, which is to quiet title to
land and to put a stop forever to any question on the legality of the title, except claims that were noted, at the
time of registration, in the certificate, or which may arise subsequent thereto.42 Once a title is registered under
the Torrens system, the owner may rest secure, without the necessity of waiting in the portals of the courts or
sitting in the "mirador su casa" to avoid the possibility of losing his land.43 Rarely will the court allow another
person to attack the validity and indefeasibility of a Torrens certificate, unless there is compelling reason to
do so and only upon a direct action filed in court proceeded in accordance with law.44
Finally, this Court also takes note of the fact that for more than 30 years from the time Entry No. 20102 was
annotated at the back of OCT No. 40287 on February 17, 1950 until the time of the filing of the ex parte
petition for cancellation of entries on the said certificate of title on November 19, 1985 the Salazars
remained deafeningly quiet and never made any move to question the issue of ownership over the said land
before the proper forum.lawphil.net They also failed to ventilate their claim during the intestate proceeding
filed by the heirs of Juan Soriano sometime in 1939. Likewise, they miserably failed to stop the transfer of
portions of the property to petitioners who, for themselves, were able to secure TCTs in their own names. All
of these would lead to the inevitable conclusion that if there is any validity to the claim of the Salazars over
the said property although such issue is not the subject of the present case the same had already
prescribed45 or, at the very least, had become stale due to laches.
WHEREFORE, the petition is GRANTED. The assailed July 25, 2003 Decision of the Court of Appeals
including its November 25, 2003 Resolution are hereby SET ASIDE. Accordingly, the December 20, 2000
Decision rendered by Branch 64 of the Regional Trial Court of Tarlac City, Tarlac is REINSTATED. Costs
against respondents.
SO ORDERED.

SAUDIA VS. CA

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59

SAUDI ARABIAN AIRLINES (SAUDIA) vs. COURT OF APPEALS, MILAGROS P. MORADA


and HON. RODOLFO A. ORTIZ, in his capacity as Presiding Judge of Branch 89, RTC of
Quezon City
G.R. No. 122191 October 8, 1998
FACTS: Petitioner SAUDIA hired private respondent MORADA as a flight attendant in 1988,
based in Jeddah. On 1990, while on a lay-over in Jakarta, Indonesia, she went to party with 2
male attendants, and on the following morning in their hotel, one of the male attendants
attempted to rape her. She was rescued by hotel attendants who heard her cry for help. The
Indonesian police arrested the 2.
MORADA returned to Jeddah, but was asked by the company to go back to Jakarta and help
arrange the release of the 2 male attendants. MORADA did not cooperate when she got to
Jakarta.
What followed was a series of interrogations from the Saudi Courts which she did not
understand as this was in their language. In 1993, she was surprised, upon being ordered by
SAUDIA to go to the Saudi court, that she was being convicted of (1) adultery; (2) going to a
disco, dancing and listening to the music in violation of Islamic laws; and (3) socializing with
the male crew, in contravention of Islamic tradition, sentencing her to five months
imprisonment and to 286 lashes. Only then did she realize that the Saudi court had tried her,
together with the 2, for what happened in Jakarta.
SAUDIA denied her the assistance she requested, But because she was wrongfully convicted,
Prince of Makkah dismissed the case against her and allowed her to leave Saudi Arabia.
Shortly before her return to Manila, she was terminated from the service by SAUDIA, without
her being informed of the cause.
On November 23, 1993, Morada filed a Complaint for damages against SAUDIA, and Khaled
Al-Balawi (Al-Balawi), its country manager.
SAUDIA ALLEGES: Private respondents claim for alleged abuse of rights occurred in the
Kingdom of Saudi Arabia. It alleges that the existence of a foreign element qualifies the
instant case for the application of the law of the Kingdom of Saudi Arabia, by virtue of the lex
loci delicti commissi rule.
MORADA ALLEGES: Since her Amended Complaint is based on Articles 19 and 21 of the Civil
Code, then the instant case is properly a matter of domestic law.
ISSUE: WON the Philippine courts have jurisdiction to try the case
HELD: YES.
On the presence of a Foreign Element in the case: A factual situation that cuts across
territorial lines and is affected by the diverse laws of two or more states is said to contain a
foreign element. The presence of a foreign element is inevitable since social and economic
affairs of individuals and associations are rarely confined to the geographic limits of their
birth or conception. The forms in which this foreign element may appear are many. The foreign
element may simply consist in the fact that one of the parties to a contract is an alien or has a
foreign domicile, or that a contract between nationals of one State involves properties situated
in another State. In other cases, the foreign element may assume a complex form.
In the instant case, the foreign element consisted in the fact that private respondent Morada is
a resident Philippine national, and that petitioner SAUDIA is a resident foreign corporation.
Also, by virtue of the employment of Morada with the petitioner Saudia as a flight stewardess,
events did transpire during her many occasions of travel across national borders, particularly

60

from Manila, Philippines to Jeddah, Saudi Arabia, and vice versa, that caused a conflicts
situation to arise.
COURT disagrees with MORADA that his is purely a domestic case. However, the court finds
that the RTC of Quezon City possesses jurisdiction over the subject matter of the suit. Its
authority to try and hear the case is provided for under Section 1 of Republic Act No. 7691, to
wit:
BP129 Sec. 19. Jurisdiction in Civil Cases. Regional Trial Courts shall exercise exclusive
jurisdiction:
xxx xxx xxx
(8) In all other cases in which demand, exclusive of interest, damages of whatever kind,
attorney`ys fees, litigation expenses, and cots or the value of the property in controversy
exceeds One hundred thousand pesos (P100,000.00) or, in such other cases in Metro Manila,
where the demand, exclusive of the above-mentioned items exceeds Two hundred Thousand
pesos (P200,000.00). (Emphasis ours)
xxx xxx xxx
Section 2 (b), Rule 4 of the Revised Rules of Court the venue, Quezon City, is appropriate:
Sec. 2 Venue in Courts of First Instance. [Now Regional Trial Court]
(a) xxx xxx xxx
(b) Personal actions. All other actions may be commenced and tried where the defendant or
any of the defendants resides or may be found, or where the plaintiff or any of the plaintiff
resides, at the election of the plaintiff.
Weighing the relative claims of the parties, the court a quo found it best to hear the case in the
Philippines. Had it refused to take cognizance of the case, it would be forcing plaintiff
(private respondent now) to seek remedial action elsewhere, i.e. in the Kingdom of Saudi
Arabia where she no longer maintains substantial connections. That would have caused a
fundamental unfairness to her.
Moreover, by hearing the case in the Philippines no unnecessary difficulties and inconvenience
have been shown by either of the parties. The choice of forum of the plaintiff (now private
respondent) should be upheld.
The trial court also acquired jurisdiction over the parties. MORADA through her act of filing,
and SAUDIA by praying for the dismissal of the Amended Complaint on grounds other than
lack of jurisdiction.
As to the choice of applicable law, we note that choice-of-law problems seek to answer two
important questions:
(1) What legal system should control a given situation where some of the significant facts
occurred in two or more states; and
(2) to what extent should the chosen legal system regulate the situation.
Considering that the complaint in the court a quo is one involving torts, the connecting
factor or point of contact could be the place or places where the tortious conduct or lex
loci actus occurred. And applying the torts principle in a conflicts case, we find that the
Philippines could be said as a situs of the tort (the place where the alleged tortious conduct
took place). This is because it is in the Philippines where petitioner allegedly deceived private
respondent, a Filipina residing and working here. According to her, she had honestly believed
that petitioner would, in the exercise of its rights and in the performance of its duties, act
with justice, give her due and observe honesty and good faith. Instead, petitioner failed to
protect her, she claimed. That certain acts or parts of the injury allegedly occurred in another
country is of no moment. For in our view what is important here is the place where the overall harm or the totality of the alleged injury to the person, reputation, social standing and

61

human rights of complainant, had lodged, according to the plaintiff below (herein private
respondent). All told, it is not without basis to identify the Philippines as the situs of the
alleged tort.
In applying State of the most significant relationship rule, to determine the State which has
the most significant relationship, the following contacts are to be taken into account and
evaluated according to their relative importance with respect to the particular issue: (a) the
place where the injury occurred; (b) the place where the conduct causing the injury occurred;
(c) the domicile, residence, nationality, place of incorporation and place of business of the
parties, and (d) the place where the relationship, if any, between the parties is centered.
As already discussed, there is basis for the claim that over-all injury occurred and lodged in
the Philippines. There is likewise no question that private respondent is a resident Filipina
national, working with petitioner, a resident foreign corporation engaged here in the business
of international air carriage. Thus, the relationship between the parties was centered here,
although it should be stressed that this suit is not based on mere labor law violations. From
the record, the claim that the Philippines has the most significant contact with the matter in
this dispute, raised by private respondent as plaintiff below against defendant (herein
petitioner), in our view, has been properly established.
NOTE:
These test factors or points of contact or connecting factors could be any of the
following:
(1) The nationality of a person, his domicile, his residence, his place of sojourn, or his origin;
(2) the seat of a legal or juridical person, such as a corporation;
(3) the situs of a thing, that is, the place where a thing is, or is deemed to be situated. In
particular, the lex situs is decisive when real rights are involved;
(4) the place where an act has been done, the locus actus, such as the place where a contract
has been made, a marriage celebrated, a will signed or a tort committed. The lex loci actus is
particularly important in contracts and torts;
(5) the place where an act is intended to come into effect, e.g., the place of performance of
contractual duties, or the place where a power of attorney is to be exercised;
(6) the intention of the contracting parties as to the law that should govern their agreement,
the lex loci intentionis;
(7) the place where judicial or administrative proceedings are instituted or done. The lex fori
the law of the forum is particularly important because, as we have seen earlier, matters
of procedure not going to the substance of the claim involved are governed by it; and
because the lex fori applies whenever the content of the otherwise applicable foreign law is
excluded from application in a given case for the reason that it falls under one of the
exceptions to the applications of foreign law; and
(8) the flag of a ship, which in many cases is decisive of practically all legal relationships of
the ship and of its master or owner as such. It also covers contractual relationships
particularly contracts of affreightment.
ATCI OVERSEAS CORPORATION,
AMALIA G. IKDAL and MINISTRY
OF PUBLIC HEALTH-KUWAIT
Petitioners,
- versus -

G.R. No. 178551


Present:
CARPIO MORALES, Chairperson, J.,
BRION,
BERSAMIN,
VILLARAMA, JR., and
SERENO, JJ.

62

MA. JOSEFA ECHIN,


Respondent.

Promulgated:

October 11, 2010


x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION
CARPIO MORALES, J.:
Josefina Echin (respondent) was hired by petitioner ATCI Overseas Corporation in behalf of its
principal-co-petitioner, the Ministry of Public Health of Kuwait (the Ministry), for the position of medical
technologist under a two-year contract, denominated as a Memorandum of Agreement (MOA), with a
monthly salary of US$1,200.00.
Under the MOA,[1] all newly-hired employees undergo a probationary period of one (1) year and are
covered by Kuwaits Civil Service Board Employment Contract No. 2.
Respondent was deployed on February 17, 2000 but was terminated from employment on February
11, 2001, she not having allegedly passed the probationary period.
As the Ministry denied respondents request for reconsideration, she returned to the Philippines on
March 17, 2001, shouldering her own air fare.
On July 27, 2001, respondent filed with the National Labor Relations Commission (NLRC) a
complaint[2] for illegal dismissal against petitioner ATCI as the local recruitment agency, represented by
petitioner, Amalia Ikdal (Ikdal), and the Ministry, as the foreign principal.
By Decision[3] of November 29, 2002, the Labor Arbiter, finding that petitioners neither showed that
there was just cause to warrant respondents dismissal nor that she failed to qualify as a regular employee,
held that respondent was illegally dismissed and accordingly ordered petitioners to pay her US$3,600.00,
representing her salary for the three months unexpired portion of her contract.
On appeal of petitioners ATCI and Ikdal, the NLRC affirmed the Labor Arbiters decision by
Resolution[4] of January 26, 2004. Petitioners motion for reconsideration having been denied by
Resolution[5] of April 22, 2004, they appealed to the Court of Appeals, contending that their principal, the
Ministry, being a foreign government agency, is immune from suit and, as such, the immunity extended to
them; and that respondent was validly dismissed for her failure to meet the performance rating within the
one-year period as required under Kuwaits Civil Service Laws. Petitioners further contended that Ikdal
should not be liable as an officer of petitioner ATCI.
By Decision[6] of March 30, 2007, the appellate court affirmed the NLRC Resolution.
In brushing aside petitioners contention that they only acted as agent of the Ministry and that they
cannot be held jointly and solidarily liable with it, the appellate court noted that under the law, a
private employment agency shall assume all responsibilities for the implementation of the contract of

63

employment of an overseas worker, hence, it can be sued jointly and severally with the foreign principal for
any violation of the recruitment agreement or contract of employment.
As to Ikdals liability, the appellate court held that under Sec. 10 of Republic Act No. 8042, the
Migrant and Overseas Filipinos Act of 1995, corporate officers, directors and partners of a recruitment
agency may themselves be jointly and solidarily liable with the recruitment agency for money claims and
damages awarded to overseas workers.
Petitioners motion for reconsideration having been denied by the appellate court by Resolution [7] of
June 27, 2007, the present petition for review on certiorari was filed.
Petitioners maintain that they should not be held liable because respondents employment contract
specifically stipulates that her employment shall be governed by the Civil Service Law and Regulations of
Kuwait. They thus conclude that it was patent error for the labor tribunals and the appellate court to apply
the Labor Code provisions governing probationary employment in deciding the present case.
Further, petitioners argue that even the Philippine Overseas Employment Act (POEA) Rules relative
to master employment contracts (Part III, Sec. 2 of the POEA Rules and Regulations) accord respect to the
customs, practices, company policies and labor laws and legislation of the host country.
Finally, petitioners posit that assuming arguendo that Philippine labor laws are applicable, given that
the foreign principal is a government agency which is immune from suit, as in fact it did not sign any
document agreeing to be held jointly and solidarily liable, petitioner ATCI cannot likewise be held liable,
more so since the Ministrys liability had not been judicially determined as jurisdiction was not acquired over
it.
The petition fails.
Petitioner ATCI, as a private recruitment agency, cannot evade responsibility for the money claims of
Overseas Filipino workers (OFWs) which it deploys abroad by the mere expediency of claiming that its
foreign principal is a government agency clothed with immunity from suit, or that such foreign principals
liability must first be established before it, as agent, can be held jointly and solidarily liable.
In providing for the joint and solidary liability of private recruitment agencies with their foreign
principals, Republic Act No. 8042 precisely affords the OFWs with a recourse and assures them of immediate
and sufficient payment of what is due them. Skippers United Pacific v. Maguad[8] explains:
. . . [T]he obligations covenanted in the recruitment agreement entered into by and between
the local agent and its foreign principal are not coterminous with the term of such
agreement so that if either or both of the parties decide to end the agreement, the
responsibilities of such parties towards the contracted employees under the agreement do not
at all end, but the same extends up to and until the expiration of the employment contracts of
the employees recruited and employed pursuant to the said recruitment agreement. Otherwise,
this will render nugatory the very purpose for which the law governing the employment of
workers for foreign jobs abroad was enacted. (emphasis supplied)

64

The imposition of joint and solidary liability is in line with the policy of the state to protect and alleviate the
plight of the working class.[9] Verily, to allow petitioners to simply invoke the immunity from suit of its
foreign principal or to wait for the judicial determination of the foreign principals liability before petitioner
can be held liable renders the law on joint and solidary liability inutile.
As to petitioners contentions that Philippine labor laws on probationary employment are not
applicable since it was expressly provided in respondents employment contract, which she voluntarily
entered into, that the terms of her engagement shall be governed by prevailing Kuwaiti Civil Service Laws
and Regulations as in fact POEA Rules accord respect to such rules, customs and practices of the host
country, the same was not substantiated.
Indeed, a contract freely entered into is considered the law between the parties who can establish
stipulations, clauses, terms and conditions as they may deem convenient, including the laws which they wish
to govern their respective obligations, as long as they are not contrary to law, morals, good customs, public
order or public policy.
It is hornbook principle, however, that the party invoking the application of a foreign law has the
burden of proving the law, under the doctrine of processual presumptionwhich, in this case, petitioners failed
to discharge. The Courts ruling in EDI-Staffbuilders Intl., v. NLRC[10] illuminates:
In the present case, the employment contract signed by Gran specifically states that Saudi
Labor Laws will govern matters not provided for in the contract (e.g. specific causes for
termination, termination procedures, etc.). Being the law intended by the parties (lex loci
intentiones) to apply to the contract, Saudi Labor Laws should govern all matters relating to
the
termination
of
the
employment
of
Gran.
In international law, the party who wants to have a foreign law applied to a dispute or case has
the burden of proving the foreign law. The foreign law is treated as a question of fact to be
properly pleaded and proved as the judge or labor arbiter cannot take judicial notice of a
foreign law. He is presumed to know only domestic or forum law.
Unfortunately for petitioner, it did not prove the pertinent Saudi laws on the matter; thus, the
International Law doctrine of presumed-identity approach or processual presumption comes
into play. Where a foreign law is not pleaded or, even if pleaded, is not proved, the
presumption is that foreign law is the same as ours. Thus, we apply Philippine labor laws in
determining the issues presented before us. (emphasis and underscoring supplied)

The Philippines does not take judicial notice of foreign laws, hence, they must not only be alleged;
they must be proven. To prove a foreign law, the party invoking it must present a copy thereof and comply
with Sections 24 and 25 of Rule 132 of the Revised Rules of Court which reads:
SEC. 24. Proof of official record. The record of public documents referred to in
paragraph (a) of Section 19, when admissible for any purpose, may be evidenced by an official
publication thereof or by a copy attested by the officer having the legal custody of the record,
or by his deputy, and accompanied, if the record is not kept in the Philippines, with a
certificate that such officer has the custody. If the office in which the record is kept is in a
foreign country, the certificate may be made by a secretary of the embassy or legation, consul
general, consul, vice consul, or consular agent or by any officer in the foreign service of the

65

Philippines stationed in the foreign country in which the record is kept, and authenticated by
the seal of his office. (emphasis supplied)

SEC. 25. What attestation of copy must state. Whenever a copy of a document or
record is attested for the purpose of the evidence, the attestation must state, in substance, that
the copy is a correct copy of the original, or a specific part thereof, as the case may be. The
attestation must be under the official seal of the attesting officer, if there be any, or if he be the
clerk of a court having a seal, under the seal of such court.
To prove the Kuwaiti law, petitioners submitted the following: MOA between respondent and the
Ministry, as represented by ATCI, which provides that the employee is subject to a probationary period of
one (1) year and that the host countrys Civil Service Laws and Regulations apply; a translated
copy[11] (Arabic to English) of the termination letter to respondent stating that she did not pass the probation
terms, without specifying the grounds therefor, and a translated copy of the certificate of termination, [12] both
of which documents were certified by Mr. Mustapha Alawi, Head of the Department of Foreign AffairsOffice of Consular Affairs Inslamic Certification and Translation Unit; and respondents letter[13] of
reconsideration to the Ministry, wherein she noted that in her first eight (8) months of employment, she was
given a rating of Excellent albeit it changed due to changes in her shift of work schedule.
These documents, whether taken singly or as a whole, do not sufficiently prove that respondent was
validly terminated as a probationary employee under Kuwaiti civil service laws. Instead of submitting a copy
of the pertinent Kuwaiti labor laws duly authenticated and translated by Embassy officials thereat, as required
under the Rules, what petitioners submitted were mere certifications attesting only to the correctness of the
translations of the MOA and the termination letter which does not prove at all that Kuwaiti civil service laws
differ from Philippine laws and that under such Kuwaiti laws, respondent was validly terminated. Thus the
subject certifications read:
xxxx
This is to certify that the herein attached translation/s from Arabic to English/Tagalog
and or vice versa was/were presented to this Office for review and certification and the same
was/were found to be in order. This Office, however, assumes no responsibility as to the
contents of the document/s.
This certification is being issued upon request of the interested party for whatever legal
purpose it may serve. (emphasis supplied)

Respecting Ikdals joint and solidary liability as a corporate officer, the same is in order too following
the express provision of R.A. 8042 on money claims, viz:
SEC. 10. Money Claims.Notwithstanding any provision of law to the contrary, the
Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original
and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing
of the complaint, the claims arising out of an employer-employee relationship or by virtue of
any law or contract involving Filipino workers for overseas deployment including claims for
actual moral, exemplary and other forms of damages.
The liability of the principal/employer and the recruitment/placement agency for any and all
claims under this section shall be joint and several. This provision shall be incorporated in the

66

contract for overseas employment and shall be a condition precedent for its approval. The
performance bond to be filed by the recruitment/placement agency, as provided by law, shall
be answerable for all money claims or damages that may be awarded to the workers. If the
recruitment/placement agency is a juridical being, the corporate officers and directors and
partners as the case may be, shall themselves be jointly and solidarily liable with the
corporation or partnership for the aforesaid claims and damages. (emphasis and underscoring
supplied)
WHEREFORE, the petition is DENIED.
SO ORDERED.
G.R. No. 136804

February 19, 2003

MANUFACTURERS HANOVER TRUST CO. and/or CHEMICAL BANK, petitioners,


vs.
RAFAEL MA. GUERRERO, respondent.
DECISION
CARPIO, J.:
The Case
This is a petition for review under Rule 45 of the Rules of Court to set aside the Court of Appeals1 Decision
of August 24, 1998 and Resolution of December 14, 1998 in CA-G.R. SP No. 423102 affirming the trial
courts denial of petitioners motion for partial summary judgment.
The Antecedents
On May 17, 1994, respondent Rafael Ma. Guerrero ("Guerrero" for brevity) filed a complaint for damages
against petitioner Manufacturers Hanover Trust Co. and/or Chemical Bank ("the Bank" for brevity) with the
Regional Trial Court of Manila ("RTC" for brevity). Guerrero sought payment of damages allegedly for (1)
illegally withheld taxes charged against interests on his checking account with the Bank; (2) a returned check
worth US$18,000.00 due to signature verification problems; and (3) unauthorized conversion of his account.
Guerrero amended his complaint on April 18, 1995.
On September 1, 1995, the Bank filed its Answer alleging, inter alia, that by stipulation Guerreros account is
governed by New York law and this law does not permit any of Guerreros claims except actual damages.
Subsequently, the Bank filed a Motion for Partial Summary Judgment seeking the dismissal of Guerreros
claims for consequential, nominal, temperate, moral and exemplary damages as well as attorneys fees on the
same ground alleged in its Answer. The Bank contended that the trial should be limited to the issue of actual
damages. Guerrero opposed the motion.
The affidavit of Alyssa Walden, a New York attorney, supported the Banks Motion for Partial Summary
Judgment. Alyssa Waldens affidavit ("Walden affidavit" for brevity) stated that Guerreros New York bank
account stipulated that the governing law is New York law and that this law bars all of Guerreros claims
except actual damages. The Philippine Consular Office in New York authenticated the Walden affidavit.
The RTC denied the Banks Motion for Partial Summary Judgment and its motion for reconsideration on
March 6, 1996 and July 17, 1996, respectively. The Bank filed a petition for certiorari and prohibition with
the Court of Appeals assailing the RTC Orders. In its Decision dated August 24, 1998, the Court of Appeals
dismissed the petition. On December 14, 1998, the Court of Appeals denied the Banks motion for
reconsideration.
Hence, the instant petition.

67

The Ruling of the Court of Appeals


The Court of Appeals sustained the RTC orders denying the motion for partial summary judgment. The Court
of Appeals ruled that the Walden affidavit does not serve as proof of the New York law and jurisprudence
relied on by the Bank to support its motion. The Court of Appeals considered the New York law and
jurisprudence as public documents defined in Section 19, Rule 132 of the Rules on Evidence, as follows:
"SEC. 19. Classes of Documents. For the purpose of their presentation in evidence, documents are either
public or private.
Public documents are:
(a) The written official acts, or records of the official acts of the sovereign authority, official bodies and
tribunals, and public officers, whether of the Philippines, or of a foreign country;
x x x."
The Court of Appeals opined that the following procedure outlined in Section 24, Rule 132 should be
followed in proving foreign law:
"SEC. 24. Proof of official record. The record of public documents referred to in paragraph (a) of Section
19, when admissible for any purpose, may be evidenced by an official publication thereof or by a copy
attested by the officer having the legal custody of the record, or by his deputy, and accompanied, if the record
is not kept in the Philippines, with a certificate that such officer has the custody. If the office in which the
record is kept is in a foreign country, the certificate may be made by a secretary of the embassy or legation,
consul general, consul, vice consul, or consular agent or by any officer in the foreign service of the
Philippines stationed in the foreign country in which the record is kept, and authenticated by the seal of his
office."
The Court of Appeals likewise rejected the Banks argument that Section 2, Rule 34 of the old Rules of Court
allows the Bank to move with the supporting Walden affidavit for partial summary judgment in its favor. The
Court of Appeals clarified that the Walden affidavit is not the supporting affidavit referred to in Section 2,
Rule 34 that would prove the lack of genuine issue between the parties. The Court of Appeals concluded that
even if the Walden affidavit is used for purposes of summary judgment, the Bank must still comply with the
procedure prescribed by the Rules to prove the foreign law.
The Issues
The Bank contends that the Court of Appeals committed reversible error in "x x x HOLDING THAT [THE BANKS] PROOF OF FACTS TO SUPPORT ITS MOTION FOR
SUMMARY JUDGMENT MAY NOT BE GIVEN BY AFFIDAVIT;
x x x HOLDING THAT [THE BANKS] AFFIDAVIT, WHICH PROVES FOREIGN LAW AS A FACT, IS
"HEARSAY" AND THEREBY CANNOT SERVE AS PROOF OF THE NEW YORK LAW RELIED
UPON BY PETITIONERS IN THEIR MOTION FOR SUMMARY JUDGMENT x x x."3
First, the Bank argues that in moving for partial summary judgment, it was entitled to use the Walden
affidavit to prove that the stipulated foreign law bars the claims for consequential, moral, temperate,
nominal and exemplary damages and attorneys fees. Consequently, outright dismissal by summary
judgment of these claims is warranted.
Second, the Bank claims that the Court of Appeals mixed up the requirements of Rule 35 on summary
judgments and those of a trial on the merits in considering the Walden affidavit as "hearsay." The
Bank points out that the Walden affidavit is not hearsay since Rule 35 expressly permits the use of
affidavits.

68

Lastly, the Bank argues that since Guerrero did not submit any opposing affidavit to refute the facts
contained in the Walden affidavit, he failed to show the need for a trial on his claims for damages
other than actual.
The Courts Ruling
The petition is devoid of merit.
The Bank filed its motion for partial summary judgment pursuant to Section 2, Rule 34 of the old Rules of
Court which reads:
"Section 2. Summary judgment for defending party. A party against whom a claim, counterclaim, or crossclaim is asserted or a declaratory relief is sought may, at any time, move with supporting affidavits for a
summary judgment in his favor as to all or any part thereof."
A court may grant a summary judgment to settle expeditiously a case if, on motion of either party, there
appears from the pleadings, depositions, admissions, and affidavits that no important issues of fact are
involved, except the amount of damages. In such event, the moving party is entitled to a judgment as a matter
of law.4
In a motion for summary judgment, the crucial question is: are the issues raised in the
pleadings genuine, shamor fictitious, as shown by affidavits, depositions or admissions accompanying the
motion?5
A genuine issue means an issue of fact which calls for the presentation of evidence as distinguished from an
issue which is fictitious or contrived so as not to constitute a genuine issue for trial.6
A perusal of the parties respective pleadings would show that there are genuine issues of fact that necessitate
formal trial. Guerreros complaint before the RTC contains a statement of the ultimate facts on which he
relies for his claim for damages. He is seeking damages for what he asserts as "illegally withheld taxes
charged against interests on his checking account with the Bank, a returned check worth US$18,000.00 due
to signature verification problems, and unauthorized conversion of his account." In its Answer, the Bank set
up its defense that the agreed foreign law to govern their contractual relation bars the recovery of damages
other than actual. Apparently, facts are asserted in Guerreros complaint while specific denials and affirmative
defenses are set out in the Banks answer.
True, the court can determine whether there are genuine issues in a case based merely on the affidavits or
counter-affidavits submitted by the parties to the court. However, as correctly ruled by the Court of Appeals,
the Banks motion for partial summary judgment as supported by the Walden affidavit does not demonstrate
that Guerreros claims are sham, fictitious or contrived. On the contrary, the Walden affidavit shows that the
facts and material allegations as pleaded by the parties are disputed and there are substantial triable issues
necessitating a formal trial.
There can be no summary judgment where questions of fact are in issue or where material allegations of the
pleadings are in dispute.7 The resolution of whether a foreign law allows only the recovery of actual damages
is a question of fact as far as the trial court is concerned since foreign laws do not prove themselves in our
courts.8Foreign laws are not a matter of judicial notice.9 Like any other fact, they must be alleged and proven.
Certainly, the conflicting allegations as to whether New York law or Philippine law applies to Guerreros
claims present a clear dispute on material allegations which can be resolved only by a trial on the merits.
Under Section 24 of Rule 132, the record of public documents of a sovereign authority or tribunal may be
proved by (1) an official publication thereof or (2) a copy attested by the officer having the legal custody
thereof. Such official publication or copy must be accompanied, if the record is not kept in the Philippines,
with a certificate that the attesting officer has the legal custody thereof. The certificate may be issued by any
of the authorized Philippine embassy or consular officials stationed in the foreign country in which the record
is kept, and authenticated by the seal of his office. The attestation must state, in substance, that the copy is a
correct copy of the original, or a specific part thereof, as the case may be, and must be under the official seal
of the attesting officer.

69

Certain exceptions to this rule were recognized in Asiavest Limited v. Court of Appeals10 which held that:
"x x x:
Although it is desirable that foreign law be proved in accordance with the above rule, however, the Supreme
Court held in the case of Willamette Iron and Steel Works v. Muzzal, that Section 41, Rule 123 (Section 25,
Rule 132 of the Revised Rules of Court) does not exclude the presentation of other competent evidence to
prove the existence of a foreign law. In that case, the Supreme Court considered the testimony under oath of
an attorney-at-law of San Francisco, California, who quoted verbatim a section of California Civil Code and
who stated that the same was in force at the time the obligations were contracted, as sufficient evidence to
establish the existence of said law.Accordingly, in line with this view, the Supreme Court in the Collector of
Internal Revenue v. Fisher et al., upheld the Tax Court in considering the pertinent law of California as
proved by the respondents witness. In that case,the counsel for respondent "testified that as an active
member of the California Bar since 1951, he is familiar with the revenue and taxation laws of the State of
California. When asked by the lower court to state the pertinent California law as regards exemption of
intangible personal properties, the witness cited Article 4, Sec. 13851 (a) & (b) of the California Internal and
Revenue Code as published in Derrings California Code, a publication of Bancroft-Whitney Co., Inc. And as
part of his testimony, a full quotation of the cited section was offered in evidence by respondents." Likewise,
in several naturalization cases, it was held by the Court that evidence of the law of a foreign country on
reciprocity regarding the acquisition of citizenship, although not meeting the prescribed rule of practice, may
be allowed and used as basis for favorable action, if, in the light of all the circumstances, the Court is
"satisfied of the authenticity of the written proof offered." Thus, in a number of decisions, mere
authentication of the Chinese Naturalization Law by the Chinese Consulate General of Manila was held to be
competent proof of that law." (Emphasis supplied)
The Bank, however, cannot rely on Willamette Iron and Steel Works v. Muzzal or Collector of Internal
Revenue v. Fisher to support its cause. These cases involved attorneys testifying in open court during the trial
in the Philippines and quoting the particular foreign laws sought to be established. On the other hand, the
Walden affidavit was taken abroad ex parte and the affiant never testified in open court.1a\^/phi1.net The
Walden affidavit cannot be considered as proof of New York law on damages not only because it is selfserving but also because it does not state the specific New York law on damages. We reproduce portions of
the Walden affidavit as follows:
"3. In New York, "[n]ominal damages are damages in name only, trivial sums such as six cents or $1.
Such damages are awarded both in tort and contract cases when the plaintiff establishes a cause of
action against the defendant, but is unable to prove" actual damages. Dobbs, Law of Remedies, 3.32
at 294 (1993). Since Guerrero is claiming for actual damages, he cannot ask for nominal damages.
4. There is no concept of temperate damages in New York law. I have reviewed Dobbs, a wellrespected treatise, which does not use the phrase "temperate damages" in its index. I have also done a
computerized search for the phrase in all published New York cases, and have found no cases that use
it. I have never heard the phrase used in American law.
5. The Uniform Commercial Code ("UCC") governs many aspects of a Banks relationship with its
depositors. In this case, it governs Guerreros claim arising out of the non-payment of the $18,000
check. Guerrero claims that this was a wrongful dishonor. However, the UCC states that "justifiable
refusal to pay or accept" as opposed to dishonor, occurs when a bank refuses to pay a check for
reasons such as a missing indorsement, a missing or illegible signature or a forgery, 3-510, Official
Comment 2. .. to the Complaint, MHT returned the check because it had no signature card on .
and could not verify Guerreros signature. In my opinion, consistent with the UCC, that is a legitimate
and justifiable reason not to pay.
6. Consequential damages are not available in the ordinary case of a justifiable refusal to pay. UCC 1106 provides that "neither consequential or special or punitive damages may be had except as
specifically provided in the Act or by other rule of law". UCC 4-103 further provides that
consequential damages can be recovered only where there is bad faith. This is more restrictive than
the New York common law, which may allow consequential damages in a breach of contract case (as
does the UCC where there is a wrongful dishonor).

70

7. Under New York law, requests for lost profits, damage to reputation and mental distress are
considered consequential damages. Kenford Co., Inc. v. Country of Erie, 73 N.Y.2d 312, 319, 540
N.Y.S.2d 1, 4-5 (1989) (lost profits); Motif Construction Corp. v. Buffalo Savings Bank, 50 A.D.2d
718, 374 N.Y.S..2d 868, 869-70 (4th Dept 1975) damage to reputation); Dobbs, Law of Remedies
12.4(1) at 63 (emotional distress).
8. As a matter of New York law, a claim for emotional distress cannot be recovered for a breach of
contract.Geler v. National Westminster Bank U.S.A., 770 F. Supp. 210, 215 (S.D.N.Y.
1991); Pitcherello v. Moray Homes, Ltd., 150 A.D.2d 860,540 N.Y.S.2d 387, 390 (3d Dept
1989) Martin v. Donald Park Acres, 54 A.D.2d 975, 389 N.Y.S..2d 31, 32 (2nd Dept 1976). Damage
to reputation is also not recoverable for a contract. Motif Construction Corp. v. Buffalo Savings Bank,
374 N.Y.S.2d at 869-70.1a\^/phi1.net
9. In cases where the issue is the breach of a contract to purchase stock, New York courts will not take
into consideration the performance of the stock after the breach. Rather, damages will be based on the
value of the stock at the time of the breach, Aroneck v. Atkin, 90 A.D.2d 966, 456 N.Y.S.2d 558, 559
(4th Dept 1982), app. den. 59 N.Y.2d 601, 449 N.E.2d 1276, 463 N.Y.S.2d 1023 (1983).
10. Under New York law, a party can only get consequential damages if they were the type that would
naturally arise from the breach and if they were "brought within the contemplation of parties as the
probable result of the breach at the time of or prior to contracting." Kenford Co., Inc. v. Country of
Erie, 73 N.Y.2d 312, 319, 540 N.Y.S.2d 1, 3 (1989), (quoting Chapman v. Fargo, 223 N.Y. 32, 36
(1918).
11. Under New York law, a plaintiff is not entitled to attorneys fees unless they are provided by
contract or statute. E.g., Geler v. National Westminster Bank, 770 F. Supp. 210, 213 (S.D.N.Y.
1991); Camatron Sewing Mach, Inc. v. F.M. Ring Assocs., Inc., 179 A.D.2d 165, 582 N.Y.S.2d 396
(1st Dept 1992); Stanisic v. Soho Landmark Assocs., 73 A.D.2d 268, 577 N.Y.S.2d 280, 281 (1st
Dept 1991). There is no statute that permits attorneys fees in a case of this type.
12. Exemplary, or punitive damages are not allowed for a breach of contract, even where the plaintiff
claims the defendant acted with malice. Geler v. National Westminster Bank, 770 F.Supp. 210, 215
(S.D.N.Y. 1991); Catalogue Service of chester11_v. Insurance Co. of North America, 74 A.D.2d
837, 838, 425 N.Y.S.2d 635, 637 (2d Dept 1980); Senior v. Manufacturers Hanover Trust Co., 110
A.D.2d 833, 488 N.Y.S.2d 241, 242 (2d Dept 1985).
13. Exemplary or punitive damages may be recovered only where it is alleged and proven that the
wrong supposedly committed by defendant amounts to a fraud aimed at the public generally and
involves a high moral culpability. Walker v. Sheldon, 10 N.Y.2d 401, 179 N.E.2d 497, 223 N.Y.S.2d
488 (1961).
14. Furthermore, it has been consistently held under New York law that exemplary damages are not
available for a mere breach of contract for in such a case, as a matter of law, only a private wrong and
not a public right is involved. Thaler v. The North Insurance Company, 63 A.D.2d 921, 406 N.Y.S.2d
66 (1st Dept 1978)."12
The Walden affidavit states conclusions from the affiants personal interpretation and opinion of the facts of
the case vis a vis the alleged laws and jurisprudence without citing any law in particular. The citations in the
Walden affidavit of various U.S. court decisions do not constitute proof of the official records or decisions of
the U.S. courts. While the Bank attached copies of some of the U.S. court decisions cited in the Walden
affidavit, these copies do not comply with Section 24 of Rule 132 on proof of official records or decisions of
foreign courts.
The Banks intention in presenting the Walden affidavit is to prove New York law and jurisprudence.
However, because of the failure to comply with Section 24 of Rule 132 on how to prove a foreign law and
decisions of foreign courts, the Walden affidavit did not prove the current state of New York law and
jurisprudence. Thus, the Bank has only alleged, but has not proved, what New York law and jurisprudence are
on the matters at issue.

71

Next, the Bank makes much of Guerreros failure to submit an opposing affidavit to the Walden affidavit.
However, the pertinent provision of Section 3, Rule 35 of the old Rules of Court did not make the submission
of an opposing affidavit mandatory, thus:
"SEC. 3. Motion and proceedings thereon. The motion shall be served at least ten (10) days before the time
specified for the hearing. The adverse party prior to the day of hearing may serve opposing affidavits. After
the hearing, the judgment sought shall be rendered forthwith if the pleadings, depositions and admissions on
file, together with the affidavits, show that, except as to the amount of damages, there is no genuine issue as
to any material fact and that the moving party is entitled to a judgment as a matter of law." (Emphasis
supplied)
It is axiomatic that the term "may" as used in remedial law, is only permissive and not mandatory.13
Guerrero cannot be said to have admitted the averments in the Banks motion for partial summary judgment
and the Walden affidavit just because he failed to file an opposing affidavit. Guerrero opposed the motion for
partial summary judgment, although he did not present an opposing affidavit. Guerrero may not have
presented an opposing affidavit, as there was no need for one, because the Walden affidavit did not establish
what the Bank intended to prove. Certainly, Guerrero did not admit, expressly or impliedly, the veracity of
the statements in the Walden affidavit. The Bank still had the burden of proving New York law and
jurisprudence even if Guerrero did not present an opposing affidavit. As the party moving for summary
judgment, the Bank has the burden of clearly demonstrating the absence of any genuine issue of fact and that
any doubt as to the existence of such issue is resolved against the movant.14
Moreover, it would have been redundant and pointless for Guerrero to submit an opposing affidavit
considering that what the Bank seeks to be opposed is the very subject matter of the complaint. Guerrero
need not file an opposing affidavit to the Walden affidavit because his complaint itself controverts the matters
set forth in the Banks motion and the Walden affidavit. A party should not be made to deny matters already
averred in his complaint.
There being substantial triable issues between the parties, the courts a quo correctly denied the Banks motion
for partial summary judgment. There is a need to determine by presentation of evidence in a regular trial if
the Bank is guilty of any wrongdoing and if it is liable for damages under the applicable laws.
This case has been delayed long enough by the Banks resort to a motion for partial summary judgment.
Ironically, the Bank has successfully defeated the very purpose for which summary judgments were devised
in our rules, which is, to aid parties in avoiding the expense and loss of time involved in a trial.
WHEREFORE, the petition is DENIED for lack of merit. The Decision dated August 24, 1998 and the
Resolution dated December 14, 1998 of the Court of Appeals in CA-G.R. SP No. 42310 is AFFIRMED.
SO ORDERED.
G.R. No. 139868

June 8, 2006

ALONZO Q. ANCHETA, Petitioner,


vs.
CANDELARIA GUERSEY-DALAYGON, Respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
Spouses Audrey ONeill (Audrey) and W. Richard Guersey (Richard) were American citizens who have
resided in the Philippines for 30 years. They have an adopted daughter, Kyle Guersey Hill (Kyle). On July
29, 1979, Audrey died, leaving a will. In it, she bequeathed her entire estate to Richard, who was also
designated as executor.1 The will was admitted to probate before the Orphans Court of Baltimore, Maryland,
U.S.A, which named James N. Phillips as executor due to Richards renunciation of his appointment.2 The
court also named Atty. Alonzo Q. Ancheta (petitioner) of the Quasha Asperilla Ancheta Pena & Nolasco Law
Offices as ancillary administrator.3

72

In 1981, Richard married Candelaria Guersey-Dalaygon (respondent) with whom he has two children,
namely, Kimberly and Kevin.
On October 12, 1982, Audreys will was also admitted to probate by the then Court of First Instance of Rizal,
Branch 25, Seventh Judicial District, Pasig, in Special Proceeding No. 9625.4 As administrator of Audreys
estate in the Philippines, petitioner filed an inventory and appraisal of the following properties: (1) Audreys
conjugal share in real estate with improvements located at 28 Pili Avenue, Forbes Park, Makati, Metro
Manila, valued atP764,865.00 (Makati property); (2) a current account in Audreys name with a cash balance
of P12,417.97; and (3) 64,444 shares of stock in A/G Interiors, Inc. worth P64,444.00.5
On July 20, 1984, Richard died, leaving a will, wherein he bequeathed his entire estate to respondent, save
for his rights and interests over the A/G Interiors, Inc. shares, which he left to Kyle.6 The will was also
admitted to probate by the Orphans Court of Ann Arundel, Maryland, U.S.A, and James N. Phillips was
likewise appointed as executor, who in turn, designated Atty. William Quasha or any member of the Quasha
Asperilla Ancheta Pena & Nolasco Law Offices, as ancillary administrator.
Richards will was then submitted for probate before the Regional Trial Court of Makati, Branch 138,
docketed as Special Proceeding No. M-888.7 Atty. Quasha was appointed as ancillary administrator on July
24, 1986.8
On October 19, 1987, petitioner filed in Special Proceeding No. 9625, a motion to declare Richard and Kyle
as heirs of Audrey.9 Petitioner also filed on October 23, 1987, a project of partition of Audreys estate, with
Richard being apportioned the undivided interest in the Makati property, 48.333 shares in A/G Interiors,
Inc., andP9,313.48 from the Citibank current account; and Kyle, the undivided interest in the Makati
property, 16,111 shares in A/G Interiors, Inc., and P3,104.49 in cash.10
The motion and project of partition was granted and approved by the trial court in its Order dated February
12, 1988.11 The trial court also issued an Order on April 7, 1988, directing the Register of Deeds of Makati to
cancel TCT No. 69792 in the name of Richard and to issue a new title in the joint names of the Estate of W.
Richard Guersey ( undivided interest) and Kyle ( undivided interest); directing the Secretary of A/G
Interiors, Inc. to transfer 48.333 shares to the Estate of W. Richard Guersey and 16.111 shares to Kyle; and
directing the Citibank to release the amount of P12,417.97 to the ancillary administrator for distribution to
the heirs.12
Consequently, the Register of Deeds of Makati issued on June 23, 1988, TCT No. 155823 in the names of the
Estate of W. Richard Guersey and Kyle.13
Meanwhile, the ancillary administrator in Special Proceeding No. M-888 also filed a project of partition
wherein 2/5of Richards undivided interest in the Makati property was allocated to respondent,
while 3/5 thereof were allocated to Richards three children. This was opposed by respondent on the ground
that under the law of the State of Maryland, "a legacy passes to the legatee the entire interest of the testator in
the property subject of the legacy."14 Since Richard left his entire estate to respondent, except for his rights
and interests over the A/G Interiors, Inc, shares, then his entire undivided interest in the Makati property
should be given to respondent.
The trial court found merit in respondents opposition, and in its Order dated December 6, 1991, disapproved
the project of partition insofar as it affects the Makati property. The trial court also adjudicated Richards
entire undivided interest in the Makati property to respondent.15
On October 20, 1993, respondent filed with the Court of Appeals (CA) an amended complaint for the
annulment of the trial courts Orders dated February 12, 1988 and April 7, 1988, issued in Special Proceeding
No. 9625.16Respondent contended that petitioner willfully breached his fiduciary duty when he disregarded
the laws of the State of Maryland on the distribution of Audreys estate in accordance with her will.
Respondent argued that since Audrey devised her entire estate to Richard, then the Makati property should be
wholly adjudicated to him, and not merely thereof, and since Richard left his entire estate, except for his
rights and interests over the A/G Interiors, Inc., to respondent, then the entire Makati property should now
pertain to respondent.

73

Petitioner filed his Answer denying respondents allegations. Petitioner contended that he acted in good faith
in submitting the project of partition before the trial court in Special Proceeding No. 9625, as he had no
knowledge of the State of Marylands laws on testate and intestate succession. Petitioner alleged that he
believed that it is to the "best interests of the surviving children that Philippine law be applied as they would
receive their just shares." Petitioner also alleged that the orders sought to be annulled are already final and
executory, and cannot be set aside.
On March 18, 1999, the CA rendered the assailed Decision annulling the trial courts Orders dated February
12, 1988 and April 7, 1988, in Special Proceeding No. 9625.17 The dispositive portion of the assailed
Decision provides:
WHEREFORE, the assailed Orders of February 12, 1998 and April 7, 1988 are hereby ANNULLED and, in
lieu thereof, a new one is entered ordering:
(a) The adjudication of the entire estate of Audrey ONeill Guersey in favor of the estate of W.
Richard Guersey; and
(b) The cancellation of Transfer Certificate of Title No. 15583 of the Makati City Registry and the
issuance of a new title in the name of the estate of W. Richard Guersey.
SO ORDERED.18
Petitioner filed a motion for reconsideration, but this was denied by the CA per Resolution dated August 27,
1999.19
Hence, the herein petition for review on certiorari under Rule 45 of the Rules of Court alleging that the CA
gravely erred in not holding that:
A) THE ORDERS OF 12 FEBRUARY 1988 AND 07 APRIL 1988 IN SPECIAL PROCEEDINGS
NO. 9625 "IN THE MATTER OF THE PETITION FOR PROBATE OF THE WILL OF THE
DECEASED AUDREY GUERSEY, ALONZO Q. ANCHETA, ANCILLARY ADMINISTRATOR",
ARE VALID AND BINDING AND HAVE LONG BECOME FINAL AND HAVE BEEN FULLY
IMPLEMENTED AND EXECUTED AND CAN NO LONGER BE ANNULLED.
B) THE ANCILLARY ADMINISTRATOR HAVING ACTED IN GOOD FAITH, DID NOT
COMMIT FRAUD, EITHER EXTRINSIC OR INTRINSIC, IN THE PERFORMANCE OF HIS
DUTIES AS ANCILLARY ADMINISTRATOR OF AUDREY ONEIL GUERSEYS ESTATE IN
THE PHILIPPINES, AND THAT NO FRAUD, EITHER EXTRINSIC OR INTRINSIC, WAS
EMPLOYED BY [HIM] IN PROCURING SAID ORDERS.20
Petitioner reiterates his arguments before the CA that the Orders dated February 12, 1988 and April 7, 1988
can no longer be annulled because it is a final judgment, which is "conclusive upon the administration as to
all matters involved in such judgment or order, and will determine for all time and in all courts, as far as the
parties to the proceedings are concerned, all matters therein determined," and the same has already been
executed.21
Petitioner also contends that that he acted in good faith in performing his duties as an ancillary administrator.
He maintains that at the time of the filing of the project of partition, he was not aware of the relevant laws of
the State of Maryland, such that the partition was made in accordance with Philippine laws. Petitioner also
imputes knowledge on the part of respondent with regard to the terms of Aubreys will, stating that as early as
1984, he already apprised respondent of the contents of the will and how the estate will be divided.22
Respondent argues that petitioners breach of his fiduciary duty as ancillary administrator of Aubreys estate
amounted to extrinsic fraud. According to respondent, petitioner was duty-bound to follow the express terms
of Aubreys will, and his denial of knowledge of the laws of Maryland cannot stand because petitioner is a
senior partner in a prestigious law firm and it was his duty to know the relevant laws.
Respondent also states that she was not able to file any opposition to the project of partition because she was
not a party thereto and she learned of the provision of Aubreys will bequeathing entirely her estate to

74

Richard only after Atty. Ancheta filed a project of partition in Special Proceeding No. M-888 for the
settlement of Richards estate.
A decree of distribution of the estate of a deceased person vests the title to the land of the estate in the
distributees, which, if erroneous may be corrected by a timely appeal. Once it becomes final, its binding
effect is like any other judgment in rem.23 However, in exceptional cases, a final decree of distribution of the
estate may be set aside for lack of jurisdiction or fraud.24 Further, in Ramon v. Ortuzar,25 the Court ruled that a
party interested in a probate proceeding may have a final liquidation set aside when he is left out by reason of
circumstances beyond his control or through mistake or inadvertence not imputable to negligence.26
The petition for annulment was filed before the CA on October 20, 1993, before the issuance of the 1997
Rules of Civil Procedure; hence, the applicable law is Batas Pambansa Blg. 129 (B.P. 129) or the Judiciary
Reorganization Act of 1980. An annulment of judgment filed under B.P. 129 may be based on the ground that
a judgment is void for want of jurisdiction or that the judgment was obtained by extrinsic fraud.27 For fraud to
become a basis for annulment of judgment, it has to be extrinsic or actual,28 and must be brought within four
years from the discovery of the fraud.29
In the present case, respondent alleged extrinsic fraud as basis for the annulment of the RTC Orders dated
February 12, 1988 and April 7, 1988. The CA found merit in respondents cause and found that petitioners
failure to follow the terms of Audreys will, despite the latters declaration of good faith, amounted to
extrinsic fraud. The CA ruled that under Article 16 of the Civil Code, it is the national law of the decedent
that is applicable, hence, petitioner should have distributed Aubreys estate in accordance with the terms of
her will. The CA also found that petitioner was prompted to distribute Audreys estate in accordance with
Philippine laws in order to equally benefit Audrey and Richard Guerseys adopted daughter, Kyle Guersey
Hill.
Petitioner contends that respondents cause of action had already prescribed because as early as 1984,
respondent was already well aware of the terms of Audreys will,30 and the complaint was filed only in 1993.
Respondent, on the other hand, justified her lack of immediate action by saying that she had no opportunity
to question petitioners acts since she was not a party to Special Proceeding No. 9625, and it was only after
Atty. Ancheta filed the project of partition in Special Proceeding No. M-888, reducing her inheritance in the
estate of Richard that she was prompted to seek another counsel to protect her interest.31
It should be pointed out that the prescriptive period for annulment of judgment based on extrinsic fraud
commences to run from the discovery of the fraud or fraudulent act/s. Respondents knowledge of the terms
of Audreys will is immaterial in this case since it is not the fraud complained of. Rather, it is petitioners
failure to introduce in evidence the pertinent law of the State of Maryland that is the fraudulent act, or in this
case, omission, alleged to have been committed against respondent, and therefore, the four-year period should
be counted from the time of respondents discovery thereof.
Records bear the fact that the filing of the project of partition of Richards estate, the opposition thereto, and
the order of the trial court disallowing the project of partition in Special Proceeding No. M-888 were all done
in 1991.32Respondent cannot be faulted for letting the assailed orders to lapse into finality since it was only
through Special Proceeding No. M-888 that she came to comprehend the ramifications of petitioners acts.
Obviously, respondent had no other recourse under the circumstances but to file the annulment case. Since
the action for annulment was filed in 1993, clearly, the same has not yet prescribed.
Fraud takes on different shapes and faces. In Cosmic Lumber Corporation v. Court of Appeals,33 the Court
stated that "man in his ingenuity and fertile imagination will always contrive new schemes to fool the
unwary."
There is extrinsic fraud within the meaning of Sec. 9 par. (2), of B.P. Blg. 129, where it is one the effect of
which prevents a party from hearing a trial, or real contest, or from presenting all of his case to the court, or
where it operates upon matters, not pertaining to the judgment itself, but to the manner in which it was
procured so that there is not a fair submission of the controversy. In other words, extrinsic fraud refers to any
fraudulent act of the prevailing party in the litigation which is committed outside of the trial of the case,
whereby the defeated party has been prevented from exhibiting fully his side of the case by fraud or
deception practiced on him by his opponent. Fraud is extrinsic where the unsuccessful party has been
prevented from exhibiting fully his case, by fraud or deception practiced on him by his opponent, as by

75

keeping him away from court, a false promise of a compromise; or where the defendant never had any
knowledge of the suit, being kept in ignorance by the acts of the plaintiff; or where an attorney fraudulently
or without authority connives at his defeat; these and similar cases which show that there has never been a
real contest in the trial or hearing of the case are reasons for which a new suit may be sustained to set aside
and annul the former judgment and open the case for a new and fair hearing.34
The overriding consideration when extrinsic fraud is alleged is that the fraudulent scheme of the prevailing
litigant prevented a party from having his day in court.35
Petitioner is the ancillary administrator of Audreys estate. As such, he occupies a position of the highest trust
and confidence, and he is required to exercise reasonable diligence and act in entire good faith in the
performance of that trust. Although he is not a guarantor or insurer of the safety of the estate nor is he
expected to be infallible, yet the same degree of prudence, care and judgment which a person of a fair
average capacity and ability exercises in similar transactions of his own, serves as the standard by which his
conduct is to be judged.36
Petitioners failure to proficiently manage the distribution of Audreys estate according to the terms of her
will and as dictated by the applicable law amounted to extrinsic fraud. Hence the CA Decision annulling the
RTC Orders dated February 12, 1988 and April 7, 1988, must be upheld.
It is undisputed that Audrey Guersey was an American citizen domiciled in Maryland, U.S.A. During the
reprobate of her will in Special Proceeding No. 9625, it was shown, among others, that at the time of
Audreys death, she was residing in the Philippines but is domiciled in Maryland, U.S.A.; her Last Will and
Testament dated August 18, 1972 was executed and probated before the Orphans Court in Baltimore,
Maryland, U.S.A., which was duly authenticated and certified by the Register of Wills of Baltimore City and
attested by the Chief Judge of said court; the will was admitted by the Orphans Court of Baltimore City on
September 7, 1979; and the will was authenticated by the Secretary of State of Maryland and the Vice Consul
of the Philippine Embassy.
Being a foreign national, the intrinsic validity of Audreys will, especially with regard as to who are her heirs,
is governed by her national law, i.e., the law of the State of Maryland, as provided in Article 16 of the Civil
Code, to wit:
Art. 16. Real property as well as personal property is subject to the law of the country where it is situated.
However, intestate and testamentary succession, both with respect to the order of succession and to the
amount of successional rights and to the intrinsic validity of testamentary provisions, shall be regulated by
the national law of the person whose succession is under consideration, whatever may be the nature of the
property and regardless of the country wherein said property may be found. (Emphasis supplied)
Article 1039 of the Civil Code further provides that "capacity to succeed is governed by the law of the nation
of the decedent."
As a corollary rule, Section 4, Rule 77 of the Rules of Court on Allowance of Will Proved Outside the
Philippines and Administration of Estate Thereunder, states:
SEC. 4. Estate, how administered.When a will is thus allowed, the court shall grant letters testamentary, or
letters of administration with the will annexed, and such letters testamentary or of administration, shall
extend to all the estate of the testator in the Philippines. Such estate, after the payment of just debts and
expenses of administration, shall be disposed of according to such will, so far as such will may operate upon
it; and the residue, if any, shall be disposed of as is provided by law in cases of estates in the Philippines
belonging to persons who are inhabitants of another state or country. (Emphasis supplied)
While foreign laws do not prove themselves in our jurisdiction and our courts are not authorized to take
judicial notice of them;37 however, petitioner, as ancillary administrator of Audreys estate, was duty-bound to
introduce in evidence the pertinent law of the State of Maryland.38
Petitioner admitted that he failed to introduce in evidence the law of the State of Maryland on Estates and
Trusts, and merely relied on the presumption that such law is the same as the Philippine law on wills and

76

succession. Thus, the trial court peremptorily applied Philippine laws and totally disregarded the terms of
Audreys will. The obvious result was that there was no fair submission of the case before the trial court or a
judicious appreciation of the evidence presented.
Petitioner insists that his application of Philippine laws was made in good faith. The Court cannot accept
petitioners protestation. How can petitioner honestly presume that Philippine laws apply when as early as the
reprobate of Audreys will before the trial court in 1982, it was already brought to fore that Audrey was a
U.S. citizen, domiciled in the State of Maryland. As asserted by respondent, petitioner is a senior partner in a
prestigious law firm, with a "big legal staff and a large library."39 He had all the legal resources to determine
the applicable law. It was incumbent upon him to exercise his functions as ancillary administrator with
reasonable diligence, and to discharge the trust reposed on him faithfully. Unfortunately, petitioner failed to
perform his fiduciary duties.
Moreover, whether his omission was intentional or not, the fact remains that the trial court failed to consider
said law when it issued the assailed RTC Orders dated February 12, 1988 and April 7, 1988, declaring
Richard and Kyle as Audreys heirs, and distributing Audreys estate according to the project of partition
submitted by petitioner. This eventually prejudiced respondent and deprived her of her full successional right
to the Makati property.
In GSIS v. Bengson Commercial Bldgs., Inc.,40 the Court held that when the rule that the negligence or
mistake of counsel binds the client deserts its proper office as an aid to justice and becomes a great hindrance
and chief enemy, its rigors must be relaxed to admit exceptions thereto and to prevent a miscarriage of
justice, and the court has the power to except a particular case from the operation of the rule whenever the
purposes of justice require it.
The CA aptly noted that petitioner was remiss in his responsibilities as ancillary administrator of Audreys
estate. The CA likewise observed that the distribution made by petitioner was prompted by his concern over
Kyle, whom petitioner believed should equally benefit from the Makati property. The CA correctly stated,
which the Court adopts, thus:
In claiming good faith in the performance of his duties and responsibilities, defendant Alonzo H. Ancheta
invokes the principle which presumes the law of the forum to be the same as the foreign law (Beam vs. Yatco,
82 Phil. 30, 38) in the absence of evidence adduced to prove the latter law (Slade Perkins vs. Perkins, 57 Phil.
205, 210). In defending his actions in the light of the foregoing principle, however, it appears that the
defendant lost sight of the fact that his primary responsibility as ancillary administrator was to distribute the
subject estate in accordance with the will of Audrey ONeill Guersey. Considering the principle established
under Article 16 of the Civil Code of the Philippines, as well as the citizenship and the avowed domicile of
the decedent, it goes without saying that the defendant was also duty-bound to prove the pertinent laws of
Maryland on the matter.
The record reveals, however, that no clear effort was made to prove the national law of Audrey ONeill
Guersey during the proceedings before the court a quo. While there is claim of good faith in distributing the
subject estate in accordance with the Philippine laws, the defendant appears to put his actuations in a different
light as indicated in a portion of his direct examination, to wit:
xxx
It would seem, therefore, that the eventual distribution of the estate of Audrey ONeill Guersey was prompted
by defendant Alonzo H. Anchetas concern that the subject realty equally benefit the plaintiffs adopted
daughter Kyle Guersey.
Well-intentioned though it may be, defendant Alonzo H. Anchetas action appears to have breached his duties
and responsibilities as ancillary administrator of the subject estate. While such breach of duty admittedly
cannot be considered extrinsic fraud under ordinary circumstances, the fiduciary nature of the said
defendants position, as well as the resultant frustration of the decedents last will, combine to create a
circumstance that is tantamount to extrinsic fraud. Defendant Alonzo H. Anchetas omission to prove the
national laws of the decedent and to follow the latters last will, in sum, resulted in the procurement of the
subject orders without a fair submission of the real issues involved in the case.41 (Emphasis supplied)

77

This is not a simple case of error of judgment or grave abuse of discretion, but a total disregard of the law as
a result of petitioners abject failure to discharge his fiduciary duties. It does not rest upon petitioners
pleasure as to which law should be made applicable under the circumstances. His onus is clear. Respondent
was thus excluded from enjoying full rights to the Makati property through no fault or negligence of her own,
as petitioners omission was beyond her control. She was in no position to analyze the legal implications of
petitioners omission and it was belatedly that she realized the adverse consequence of the same. The end
result was a miscarriage of justice. In cases like this, the courts have the legal and moral duty to provide
judicial aid to parties who are deprived of their rights.42
The trial court in its Order dated December 6, 1991 in Special Proceeding No. M-888 noted the law of the
State of Maryland on Estates and Trusts, as follows:
Under Section 1-301, Title 3, Sub-Title 3 of the Annotated Code of the Public General Laws of Maryland on
Estates and Trusts, "all property of a decedent shall be subject to the estate of decedents law, and upon his
death shall pass directly to the personal representative, who shall hold the legal title for administration and
distribution," while Section 4-408 expressly provides that "unless a contrary intent is expressly indicated in
the will, a legacy passes to the legatee the entire interest of the testator in the property which is the subject of
the legacy". Section 7-101, Title 7, Sub-Title 1, on the other hand, declares that "a personal representative is a
fiduciary" and as such he is "under the general duty to settle and distribute the estate of the decedent in
accordance with the terms of the will and the estate of decedents law as expeditiously and with as little
sacrifice of value as is reasonable under the circumstances".43
In her will, Audrey devised to Richard her entire estate, consisting of the following: (1) Audreys conjugal
share in the Makati property; (2) the cash amount of P12,417.97; and (3) 64,444 shares of stock in A/G
Interiors, Inc. worthP64,444.00. All these properties passed on to Richard upon Audreys death. Meanwhile,
Richard, in his will, bequeathed his entire estate to respondent, except for his rights and interests over the
A/G Interiors, Inc. shares, which he left to Kyle. When Richard subsequently died, the entire Makati property
should have then passed on to respondent. This, of course, assumes the proposition that the law of the State of
Maryland which allows "a legacy to pass to the legatee the entire estate of the testator in the property which
is the subject of the legacy," was sufficiently proven in Special Proceeding No. 9625. Nevertheless, the Court
may take judicial notice thereof in view of the ruling in Bohanan v. Bohanan.44 Therein, the Court took
judicial notice of the law of Nevada despite failure to prove the same. The Court held, viz.:
We have, however, consulted the records of the case in the court below and we have found that during the
hearing on October 4, 1954 of the motion of Magdalena C. Bohanan for withdrawal of P20,000 as her share,
the foreign law, especially Section 9905, Compiled Nevada Laws, was introduced in evidence by appellants'
(herein) counsel as Exhibit "2" (See pp. 77-79, Vol. II, and t.s.n. pp. 24-44, Records, Court of First Instance).
Again said law was presented by the counsel for the executor and admitted by the Court as Exhibit "B"
during the hearing of the case on January 23, 1950 before Judge Rafael Amparo (see Records, Court of First
Instance, Vol. 1).
In addition, the other appellants, children of the testator, do not dispute the above-quoted provision of the
laws of the State of Nevada. Under all the above circumstances, we are constrained to hold that the pertinent
law of Nevada, especially Section 9905 of the Compiled Nevada Laws of 1925, can be taken judicial notice
of by us, without proof of such law having been offered at the hearing of the project of partition.
In this case, given that the pertinent law of the State of Maryland has been brought to record before the CA,
and the trial court in Special Proceeding No. M-888 appropriately took note of the same in disapproving the
proposed project of partition of Richards estate, not to mention that petitioner or any other interested person
for that matter, does not dispute the existence or validity of said law, then Audreys and Richards estate
should be distributed according to their respective wills, and not according to the project of partition
submitted by petitioner. Consequently, the entire Makati property belongs to respondent.
Decades ago, Justice Moreland, in his dissenting opinion in Santos v. Manarang,45 wrote:
A will is the testator speaking after death. Its provisions have substantially the same force and effect in the
probate court as if the testator stood before the court in full life making the declarations by word of mouth as
they appear in the will. That was the special purpose of the law in the creation of the instrument known as the
last will and testament. Men wished to speak after they were dead and the law, by the creation of that

78

instrument, permitted them to do so x x x All doubts must be resolved in favor of the testator's having meant
just what he said.
Honorable as it seems, petitioners motive in equitably distributing Audreys estate cannot prevail over
Audreys and Richards wishes. As stated in Bellis v. Bellis:46
x x x whatever public policy or good customs may be involved in our system of legitimes, Congress has not
intended to extend the same to the succession of foreign nationals. For it has specifically chosen to leave,
inter alia, the amount of successional rights, to the decedent's national Law. Specific provisions must prevail
over general ones.47
Before concluding, the Court notes the fact that Audrey and Richard Guersey were American citizens who
owned real property in the Philippines, although records do not show when and how the Guerseys acquired
the Makati property.
Under Article XIII, Sections 1 and 4 of the 1935 Constitution, the privilege to acquire and exploit lands of the
public domain, and other natural resources of the Philippines, and to operate public utilities, were reserved to
Filipinos and entities owned or controlled by them. In Republic v. Quasha,48 the Court clarified that the Parity
Rights Amendment of 1946, which re-opened to American citizens and business enterprises the right in the
acquisition of lands of the public domain, the disposition, exploitation, development and utilization of natural
resources of the Philippines, does not include the acquisition or exploitation of private agricultural lands. The
prohibition against acquisition of private lands by aliens was carried on to the 1973 Constitution under
Article XIV, Section 14, with the exception of private lands acquired by hereditary succession and when the
transfer was made to a former natural-born citizen, as provided in Section 15, Article XIV. As it now stands,
Article XII, Sections 7 and 8 of the 1986 Constitution explicitly prohibits non-Filipinos from acquiring or
holding title to private lands or to lands of the public domain, except only by way of legal succession or if the
acquisition was made by a former natural-born citizen.
In any case, the Court has also ruled that if land is invalidly transferred to an alien who subsequently
becomes a citizen or transfers it to a citizen, the flaw in the original transaction is considered cured and the
title of the transferee is rendered valid.49 In this case, since the Makati property had already passed on to
respondent who is a Filipino, then whatever flaw, if any, that attended the acquisition by the Guerseys of the
Makati property is now inconsequential, as the objective of the constitutional provision to keep our lands in
Filipino hands has been achieved.
WHEREFORE, the petition is denied. The Decision dated March 18, 1999 and the Resolution dated August
27, 1999 of the Court of Appeals are AFFIRMED.
Petitioner is ADMONISHED to be more circumspect in the performance of his duties as an official of the
court.
No pronouncement as to costs.
SO ORDERED.

Edgar San Luis v. Felicidad San Luis


G.R. No. 133743 (February 6, 2007)
Facts:
The case involves the settlement of the estate of Felicisimo San Luis, who was previously the governor of the
Province of Laguna. During the lifetime of Felicisimo, he was married to three women. His first marriage
was with Virginia Sulit who predeceased Felicisimo. The second marriage was with Merry Lee Corwin, an
American citizen, who later obtained a decree granting absolute divorce before the family court of Hawaii.

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The third marriage was with the respondent, Felicidad Sagalongos, who he lived with for 18 years up to the
time of his death.
After the death of Felicisimo, the respondent sought for the dissolution of their conjugal assets and the
settlement of the estate. A petition for administration was then filed before the RTC of Makati City.
The children of Felicisimo from his first marriage filed a motion to dismiss on the following grounds: (1)
venue was improperly laid since the petition should be filed in Laguna where Felicisimo was the elected
governor; (2) Respondent does not have legal capacity to sue because her marriage with Felicisimo is
bigamous and the decree of absolute decree is not binding in the Philippines.
The RTC granted the motion to dismiss. However, the Court of Appeals reversed the decision.
Issues:
1. Whether venue was properly laid.
2. Whether the respondent has legal capacity to file the subject petition for letters of administration
Held:
1. Venue was properly laid. Under Section 1, Rule 73 of the Rules of Court, the petition for letters of
administration of the estate should be filed in the RTC of the province in which he resides at the time of
his death. In the case of Garcia Fule v. CA, we laid down the rule that for determining venue, the
residence of the decedent is determining. Residence for settlement of estate purposes means his personal,
actual or physical habitation, or actual residence of place of abode, which may not necessarily be his legal
residence or domicile provided he resides therein with continuity and consistency. It is possible that a
person may have his residence in one place and domicile in another.
2. The divorce decree obtained by Merry Lee Corwin, which absolutely allowed Felicisimo to remarry
would have vested Felicidad with the legal personality to file the present petition as the surviving spouse.
However, the respondent was not able to provide sufficient documentation to prove the decree of divorce
obtained in Hawaii.
Even assuming that Felicisimo was not capacitated to marry respondent in 1974, nevertheless, we find
that the latter has the legal personality to file the subject petition for letters of administration as she may
be considered the co-owner of Felicisimo as regards the properties acquired during their cohabitation.
The case is therefore remanded to the RTC for further proceedings.

Rodolfo San Luis vs Felicidad Sagalongos-San Luis


on November 12, 2010
Bigamy Void Marriage
During his lifetime, Felicisimo (Rodolfos dad) contracted three marriages. His first marriage was with
Virginia Sulit on March 17, 1942 out of which were born six children. On August 11, 1963, Virginia
predeceased Felicisimo.
Five years later, on May 1, 1968, Felicisimo married Merry Lee Corwin, with whom he had a son, Tobias.
However, on October 15, 1971, Merry Lee, an American citizen, filed a Complaint for Divorce before the
Family Court of the First Circuit, State of Hawaii, which issued a Decree Granting Absolute Divorce and
Awarding Child Custody on December 14, 1973. On June 20, 1974, Felicisimo married Felicidad San Luis,
then surnamed Sagalongos. He had no children with respondent but lived with her for 18 years from the time
of their marriage up to his death on December 18, 1992. Upon death of his dad Rodolfo sought the
dissolution of their conjugal partnership assets and the settlement of Felicisimos estate. On December 17,
1993, she filed a petition for letters of administration before the Regional Trial Court of Makati City. Rodolfo

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claimed that respondent has no legal personality to file the petition because she was only a mistress of
Felicisimo since the latter, at the time of his death, was still legally married to Merry Lee. Felicidad presented
the decree of absolute divorce issued by the Family Court of the First Circuit, State of Hawaii to prove that
the marriage of Felicisimo to Merry Lee had already been dissolved. Thus, she claimed that Felicisimo had
the legal capacity to marry her by virtue of paragraph 2 Article 26 of the Family Code.
Rodolfo asserted that paragraph 2, Article 26 of the Family Code cannot be given retroactive effect to
validate respondents bigamous marriage with Felicisimo because this would impair vested rights in
derogation of Article 256.
ISSUE: Whether or not Felicidads marriage to Felicisimo is bigamous.
HELD: The divorce decree allegedly obtained by Merry Lee which absolutely allowed Felicisimo to remarry,
would have vested Felicidad with the legal personality to file the present petition as Felicisimos surviving
spouse. However, the records show that there is insufficient evidence to prove the validity of the divorce
obtained by Merry Lee as well as the marriage of respondent and Felicisimo under the laws of the U.S.A.
In Garcia v. Recio, the Court laid down the specific guidelines for pleading and proving foreign law and
divorce judgments. It held that presentation solely of the divorce decree is insufficient and that proof of its
authenticity and due execution must be presented. Under Sections 24 and 25 of Rule 132, a writing or
document may be proven as a public or official record of a foreign country by either (1) an official
publication or (2) a copy thereof attested by the officer having legal custody of the document. If the record is
not kept in the Philippines, such copy must be (a) accompanied by a certificate issued by the proper
diplomatic or consular officer in the Philippine foreign service stationed in the foreign country in which the
record is kept and (b) authenticated by the seal of his office.
With regard to respondents marriage to Felicisimo allegedly solemnized in California, U.S.A., she submitted
photocopies of the Marriage Certificate and the annotated text of the Family Law Act of California which
purportedly show that their marriage was done in accordance with the said law. As stated in Garcia, however,
the Court cannot take judicial notice of foreign laws as they must be alleged and proved.
The case should be remanded to the trial court for further reception of evidence on the divorce decree
obtained by Merry Lee and the marriage of respondent and Felicisimo.

G.R. No. L-68470 October 8, 1985


ALICE REYES VAN DORN, petitioner,
vs.
HON. MANUEL V. ROMILLO, JR., as Presiding Judge of Branch CX, Regional Trial Court of the National
Capital Region Pasay City and RICHARD UPTON respondents.

MELENCIO-HERRERA, J.:\
In this Petition for certiorari and Prohibition, petitioner Alice Reyes Van Dorn seeks to set aside the Orders,
dated September 15, 1983 and August 3, 1984, in Civil Case No. 1075-P, issued by respondent Judge, which
denied her Motion to Dismiss said case, and her Motion for Reconsideration of the Dismissal Order,
respectively.

81

The basic background facts are that petitioner is a citizen of the Philippines while private respondent is a
citizen of the United States; that they were married in Hongkong in 1972; that, after the marriage, they
established their residence in the Philippines; that they begot two children born on April 4, 1973 and
December 18, 1975, respectively; that the parties were divorced in Nevada, United States, in 1982; and that
petitioner has re-married also in Nevada, this time to Theodore Van Dorn.
Dated June 8, 1983, private respondent filed suit against petitioner in Civil Case No. 1075-P of the Regional
Trial Court, Branch CXV, in Pasay City, stating that petitioner's business in Ermita, Manila, (the Galleon
Shop, for short), is conjugal property of the parties, and asking that petitioner be ordered to render an
accounting of that business, and that private respondent be declared with right to manage the conjugal
property. Petitioner moved to dismiss the case on the ground that the cause of action is barred by previous
judgment in the divorce proceedings before the Nevada Court wherein respondent had acknowledged that he
and petitioner had "no community property" as of June 11, 1982. The Court below denied the Motion to
Dismiss in the mentioned case on the ground that the property involved is located in the Philippines so that
the Divorce Decree has no bearing in the case. The denial is now the subject of this certiorari proceeding.
Generally, the denial of a Motion to Dismiss in a civil case is interlocutory and is not subject to appeal.
certiorari and Prohibition are neither the remedies to question the propriety of an interlocutory order of the
trial Court. However, when a grave abuse of discretion was patently committed, or the lower Court acted
capriciously and whimsically, then it devolves upon this Court in a certiorari proceeding to exercise its
supervisory authority and to correct the error committed which, in such a case, is equivalent to lack of
jurisdiction. 1 Prohibition would then lie since it would be useless and a waste of time to go ahead with the
proceedings. 2 Weconsider the petition filed in this case within the exception, and we have given it due
course.
For resolution is the effect of the foreign divorce on the parties and their alleged conjugal property in the
Philippines.
Petitioner contends that respondent is estopped from laying claim on the alleged conjugal property because of
the representation he made in the divorce proceedings before the American Court that they had no
community of property; that the Galleon Shop was not established through conjugal funds, and that
respondent's claim is barred by prior judgment.
For his part, respondent avers that the Divorce Decree issued by the Nevada Court cannot prevail over the
prohibitive laws of the Philippines and its declared national policy; that the acts and declaration of a foreign
Court cannot, especially if the same is contrary to public policy, divest Philippine Courts of jurisdiction to
entertain matters within its jurisdiction.
For the resolution of this case, it is not necessary to determine whether the property relations between
petitioner and private respondent, after their marriage, were upon absolute or relative community property,
upon complete separation of property, or upon any other regime. The pivotal fact in this case is the
Nevada divorce of the parties.
The Nevada District Court, which decreed the divorce, had obtained jurisdiction over petitioner who
appeared in person before the Court during the trial of the case. It also obtained jurisdiction over private
respondent who, giving his address as No. 381 Bush Street, San Francisco, California, authorized his
attorneys in the divorce case, Karp & Gradt Ltd., to agree to the divorce on the ground of incompatibility in
the understanding that there were neither community property nor community obligations. 3 As explicitly
stated in the Power of Attorney he executed in favor of the law firm of KARP & GRAD LTD., 336 W.
Liberty, Reno, Nevada, to represent him in the divorce proceedings:
xxx xxx xxx
You are hereby authorized to accept service of Summons, to file an Answer, appear on my
behalf and do an things necessary and proper to represent me, without further contesting,
subject to the following:
1. That my spouse seeks a divorce on the ground of incompatibility.

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2. That there is no community of property to be adjudicated by the Court.


3. 'I'hat there are no community obligations to be adjudicated by the court.
xxx xxx xxx 4
There can be no question as to the validity of that Nevada divorce in any of the States of the United States.
The decree is binding on private respondent as an American citizen. For instance, private respondent cannot
sue petitioner, as her husband, in any State of the Union. What he is contending in this case is that the
divorce is not valid and binding in this jurisdiction, the same being contrary to local law and public policy.
It is true that owing to the nationality principle embodied in Article 15 of the Civil Code, 5 only Philippine
nationals are covered by the policy against absolute divorces the same being considered contrary to our
concept of public police and morality. However, aliens may obtain divorces abroad, which may be recognized
in the Philippines, provided they are valid according to their national law. 6 In this case, the divorce in
Nevada released private respondent from the marriage from the standards of American law, under
which divorce dissolves the marriage. As stated by the Federal Supreme Court of the United States in
Atherton vs. Atherton, 45 L. Ed. 794, 799:
The purpose and effect of a decree of divorce from the bond of matrimony by a court of
competent jurisdiction are to change the existing status or domestic relation of husband and
wife, and to free them both from the bond. The marriage tie when thus severed as to one party,
ceases to bind either. A husband without a wife, or a wife without a husband, is unknown to
the law. When the law provides, in the nature of a penalty. that the guilty party shall not marry
again, that party, as well as the other, is still absolutely freed from the bond of the former
marriage.
Thus, pursuant to his national law, private respondent is no longer the husband of petitioner. He would have
no standing to sue in the case below as petitioner's husband entitled to exercise control over conjugal assets.
As he is bound by the Decision of his own country's Court, which validly exercised jurisdiction over him, and
whose decision he does not repudiate, he is estopped by his own representation before said Court from
asserting his right over the alleged conjugal property.
To maintain, as private respondent does, that, under our laws, petitioner has to be considered still married to
private respondent and still subject to a wife's obligations under Article 109, et. seq. of the Civil Code cannot
be just. Petitioner should not be obliged to live together with, observe respect and fidelity, and render support
to private respondent. The latter should not continue to be one of her heirs with possible rights to conjugal
property. She should not be discriminated against in her own country if the ends of justice are to be served.
WHEREFORE, the Petition is granted, and respondent Judge is hereby ordered to dismiss the Complaint
filed in Civil Case No. 1075-P of his Court.
Without costs.
SO ORDERED.

VAN DORN VS ROMILLO (G.R. NO. L-68470)


Nationality Principle Divorce
FACTS:
Petitioner Alice Reyes is a citizen of the Philippines while private respondent is a citizen of the United States;
they were married in Hongkong. Thereafter, they established their residence in the Philippines and begot two
children. Subsequently, they were divorced in Nevada, United States, and that petitioner has re-married also
in Nevada, this time to Theodore Van Dorn.

83

Private respondent filed suit against petitioner, stating that petitioners business in Manila is their conjugal
property; that petitioner he ordered to render accounting of the business and that private respondent be
declared to manage the conjugal property. Petitioner moved to dismiss the case contending that the cause of
action is barred by the judgment in the divorce proceedings before the Nevada Court. The denial now is the
subject of the certiorari proceeding.
ISSUE:
Whether or not the divorce obtained by the parties is binding only to the alien spouse.
HELD:
Is it true that owing to the nationality principle embodied in Article 15 of the Civil Code, only Philippine
nationals are covered by the policy against absolute divorces the same being considered contrary to our
concept of public policy and morality. However, aliens may obtain divorces abroad, which may be
recognized in the Philippines, provided they are valid according to their national law. In this case, the divorce
in Nevada released private respondent from the marriage from the standards of American Law, under which
divorce dissolves the marriage.
Thus, pursuant to his national law, private respondent is no longer the husband petitioner. He would have no
standing to sue in the case below as petitioners husband entitled to exercise control over conjugal assets. As
he is bound by the decision of his own countrys court, which validly exercised jurisdiction over him, and
whose decision he does not repudiate, he is stopped by his own representation before said court from
asserting his right over the alleged conjugal property.

Republic vs Orbecido III


on November 12, 2010
Article 26 of the Family Code Divorce
On May 24, 1981, Cipriano Orbecido III married Lady Myros M. Villanueva at the United Church of Christ
in the Philippines in Lam-an, Ozamis City. Their marriage was blessed with a son and a daughter, Kristoffer
Simbortriz V. Orbecido and Lady Kimberly V. Orbecido. In 1986, Ciprianos wife left for the United States
bringing along their son Kristoffer. A few years later, Cipriano discovered that his wife had been naturalized
as an American citizen. Sometime in 2000, Cipriano learned from his son that his wife had obtained a divorce
decree and then married a certain Innocent Stanley. She, Stanley and her child by him currently live at 5566
A. Walnut Grove Avenue, San Gabriel, California. Cipriano thereafter filed with the trial court a petition for
authority to remarry invoking Par 2 of Article 26 of the Family Code. No opposition was filed. Finding merit
in the petition, the court granted the same. The Republic through the Office of the Solicitor General sought
reconsideration but it was denied.
ISSUE: Whether or not Orbecido can remarry under Art 26 of the FC.
HELD: In view of the foregoing, the SC states the twin elements for the application of Paragraph 2 of Article
26 as follows:
1. There is a valid marriage that has been celebrated between a Filipino citizen and a foreigner; and
2. A valid divorce is obtained abroad by the alien spouse capacitating him or her to remarry.
The reckoning point is not the citizenship of the parties at the time of the celebration of the marriage, but
their citizenship at the time a valid divorce is obtained abroad by the alien spouse capacitating the latter to
remarry.
In this case, when Ciprianos wife was naturalized as an American citizen, there was still a valid marriage
that has been celebrated between her and Cipriano. As fate would have it, the naturalized alien wife

84

subsequently obtained a valid divorce capacitating her to remarry. Clearly, the twin requisites for the
application of Paragraph 2 of Article 26 are both present in this case. Thus Cipriano, the divorced Filipino
spouse, should be allowed to remarry.
However, since Cipriano was not able to prove as fact his wifes naturalization he is still barred from
remarrying.

HERALD BLACK DACASIN,


Petitioner,

G.R. No. 168785


Present:

- versus -

CARPIO, J., Chairperson,


BRION,
DEL CASTILLO,
ABAD, and
PEREZ, JJ.

SHARON DEL MUNDO DACASIN, Promulgated:


Respondent.
February 5, 2010
x----------------------------------------------------------------------------------------x
DECISION
CARPIO, J.:
The Case
For review[1] is a dismissal[2] of a suit to enforce a post-foreign divorce child custody agreement for lack
of jurisdiction.
The Facts

Petitioner Herald Dacasin (petitioner), American, and respondent Sharon Del Mundo Dacasin
(respondent), Filipino, were married in Manila in April 1994. They have one daughter, Stephanie, born on 21
September 1995. In June 1999, respondent sought and obtained from the Circuit Court, 19 th Judicial Circuit,
Lake County, Illinois (Illinois court) a divorce decree against petitioner.[3] In its ruling, the Illinois court
dissolved the marriage of petitioner and respondent, awarded to respondent sole custody of Stephanie and
retained jurisdiction over the case for enforcement purposes.
On 28 January 2002, petitioner and respondent executed in Manila a contract (Agreement [4]) for the
joint custody of Stephanie. The parties chose Philippine courts as exclusive forum to adjudicate disputes
arising from the Agreement. Respondent undertook to obtain from the Illinois court an order relinquishing
jurisdiction to Philippine courts.

85

In 2004, petitioner sued respondent in the Regional Trial Court of Makati City, Branch 60 (trial court)
to enforce the Agreement. Petitioner alleged that in violation of the Agreement, respondent exercised sole
custody over Stephanie.
Respondent sought the dismissal of the complaint for, among others, lack of jurisdiction because of the
Illinois courts retention of jurisdiction to enforce the divorce decree.
The Ruling of the Trial Court
In its Order dated 1 March 2005, the trial court sustained respondents motion and dismissed the case
for lack of jurisdiction. The trial court
held that: (1) it is precluded from taking cognizance over the suit
considering the Illinois courts retention of jurisdiction to enforce its divorce decree, including its order
awarding sole custody of Stephanie to respondent; (2) the divorce decree is binding on petitioner following
the nationality rule prevailing in this jurisdiction; [5] and (3) the Agreement is void for contravening Article
2035, paragraph 5 of the Civil Code[6] prohibiting compromise agreements on jurisdiction.[7]
Petitioner sought reconsideration, raising the new argument that the divorce decree obtained by
respondent is void. Thus, the divorce decree is no bar to the trial courts exercise of jurisdiction over the case.
In its Order dated 23 June 2005, the trial court denied reconsideration, holding that unlike in the case of
respondent, the divorce decree is binding on petitioner under the laws of his nationality.
Hence, this petition.
Petitioner submits the following alternative theories for the validity of the Agreement to justify its
enforcement by the trial court: (1) the Agreement novated the valid divorce decree, modifying the terms of
child custody from sole (maternal) to joint;[8] or (2) the Agreement is independent of the divorce decree
obtained by respondent.

The Issue
The question is whether the trial court has jurisdiction to take cognizance of petitioners suit and
enforce the Agreement on the joint custody of the parties child.
The Ruling of the Court
The trial court has jurisdiction to entertain petitioners suit but not to enforce the Agreement which is
void. However, factual and equity considerations militate against the dismissal of petitioners suit and call for
the remand of the case to settle the question of Stephanies custody.
Regional Trial Courts Vested With Jurisdiction
to Enforce Contracts
Subject matter jurisdiction is conferred by law. At the time petitioner filed his suit in the trial court,
statutory law vests on Regional Trial Courts exclusive original jurisdiction over civil actions incapable of
pecuniary estimation.[9] An action for specific performance, such as petitioners suit to enforce the Agreement
on joint child custody, belongs to this species of actions. [10] Thus, jurisdiction-wise, petitioner went to the
right court.

86

Indeed, the trial courts refusal to entertain petitioners suit was grounded not on its lack of power to
do so but on its thinking that the Illinois courts divorce decree stripped it of jurisdiction. This conclusion is
unfounded. What the Illinois court retained was jurisdiction x x x for the purpose of enforcing all and
sundry the various provisions of [its] Judgment for Dissolution.[11] Petitioners suit seeks the enforcement
not of the various provisions of the divorce decree but of the post-divorce Agreement on joint child
custody. Thus, the action lies beyond the zone of the Illinois courts so-called retained jurisdiction.
Petitioners Suit Lacks Cause of Action
The foregoing notwithstanding, the trial court cannot enforce the Agreement which is contrary to law.
In this jurisdiction, parties to a contract are free to stipulate the terms of agreement subject to the
minimum ban on stipulations contrary to law, morals, good customs, public order, or public policy.
[12]
Otherwise, the contract is denied legal existence, deemed inexistent and void from the beginning. [13] For
lack of relevant stipulation in the Agreement, these and other ancillary Philippine substantive law serve as
default parameters to test the validity of the Agreements joint child custody stipulations.[14]
At the time the parties executed the Agreement on 28 January 2002, two facts are undisputed: (1) Stephanie
was under seven years old (having been born on 21 September 1995); and (2) petitioner and respondent were
no longer married under the laws of the United States because of the divorce decree. The relevant Philippine
law on child custody for spouses separated in fact or in law[15] (under the second paragraph of Article 213 of
the Family Code) is also undisputed: no child under seven years of age shall be separated from the mother x
x x.[16] (This statutory awarding of sole parental custody[17] to the mother is mandatory,[18] grounded on
sound policy consideration,[19] subject only to a narrow exception not alleged to obtain here.[20]) Clearly then,
the Agreements object to establish a post-divorce joint custody regime between respondent and petitioner
over their child under seven years old contravenes Philippine law.
The Agreement is not only void ab initio for being contrary to law, it has also been repudiated by the
mother when she refused to allow joint custody by the father. The Agreement would be valid if the spouses
have not divorced or separated because the law provides for joint parental authority when spouses live
together.[21] However, upon separation of the spouses, the mother takes sole custody under the law if the child
is below seven years old and any agreement to the contrary is void. Thus, the law suspends the joint custody
regime for (1) children under seven of (2) separated or divorced spouses. Simply put, for a child within this
age bracket (and for commonsensical reasons), the law decides for the separated or divorced parents how
best to take care of the child and that is to give custody to the separated mother. Indeed, the separated parents
cannot contract away the provision in the Family Code on the maternal custody of children below seven years
anymore than they can privately agree that a mother who is unemployed, immoral, habitually drunk, drug
addict, insane or afflicted with a communicable disease will have sole custody of a child under seven as these
are reasons deemed compelling to precludethe application of the exclusive maternal custody regime under the
second paragraph of Article 213.[22]
It will not do to argue that the second paragraph of Article 213 of the Family Code applies only to
judicial custodial agreements based on its text that No child under seven years of age shall be separated
from the mother, unless the court finds compelling reasons to order otherwise. To limit this provisions
enforceability to court sanctioned agreements while placing private agreements beyond its reach is to
sanction a double standard in custody regulation of children under seven years old of separated parents. This
effectively empowers separated parents, by the simple expedient of avoiding the courts, to subvert a
legislative policy vesting to the separated mother sole custody of her children under seven years of age to

87

avoid a tragedy where a mother has seen her baby torn away from her. [23] This ignores the legislative basis
that [n]o man can sound the deep sorrows of a mother who is deprived of her child of tender age.[24]
It could very well be that Article 213s bias favoring one separated parent (mother) over the other
(father) encourages paternal neglect, presumes incapacity for joint parental custody, robs the parents of
custodial options, or hijacks decision-making between the separated parents.[25] However, these are objections
which question the laws wisdom not its validity or uniform enforceability. The forum to air and remedy these
grievances is the legislature, not this Court. At any rate, the rules seeming harshness or undesirability is
tempered by ancillary agreements the separated parents may wish to enter such as granting the father
visitation and other privileges. These arrangements are not inconsistent with the regime of sole maternal
custody under the second paragraph of Article 213 which merely grants to the mother final authority on the
care and custody of the minor under seven years of age, in case of disagreements.
Further, the imposed custodial regime under the second paragraph of Article 213 is limited in duration,
lasting only until the childs seventh year. From the eighth year until the childs emancipation, the law gives
the separated parents freedom, subject to the usual contractual limitations, to agree on custody regimes they
see fit to adopt. Lastly, even supposing that petitioner and respondent are not barred from entering into the
Agreement for the joint custody of Stephanie, respondent repudiated the Agreement by asserting sole custody
over Stephanie. Respondents act effectively brought the parties back to ambit of the default custodial regime
in the second paragraph of Article 213 of the Family Code vesting on respondent sole custody of Stephanie.
Nor can petitioner rely on the divorce decrees alleged invalidity - not because the Illinois court
lacked jurisdiction or that the divorce decree violated Illinois law, but because the divorce was obtained by
his Filipino spouse[26] - to support the Agreements enforceability. The argument that foreigners in this
jurisdiction are not bound by foreign divorce decrees is hardly novel. Van Dorn v. Romillo[27] settled the
matter by holding that an alien spouse of a Filipino is bound by a divorce decree obtained abroad. [28] There,
we dismissed the alien divorcees Philippine suit for accounting of alleged post-divorce conjugal property
and rejected his submission that the foreign divorce (obtained by the Filipino spouse) is not valid in this
jurisdiction in this wise:
There can be no question as to the validity of that Nevada divorce in any of the States
of the United States. The decree is binding on private respondent as an American citizen. For
instance, private respondent cannot sue petitioner, as her husband, in any State of the
Union. What he is contending in this case is that the divorce is not valid and binding in this
jurisdiction, the same being contrary to local law and public policy.
It is true that owing to the nationality principle embodied in Article 15 of the Civil Code, only Philippine
nationals are covered by the policy against absolute divorces the same being considered contrary to our
concept of public policy and morality. However, aliens may obtain divorces abroad, which may be
recognized in the Philippines, provided they are valid according to their national law. In this case, the divorce
in Nevada released private respondent from the marriage from the standards of American law, under which
divorce dissolves the marriage.
xxxx
Thus, pursuant to his national law, private respondent is no longer the husband of petitioner. He would have
no standing to sue in the case below as petitioners husband entitled to exercise control over conjugal assets.
As he is bound by the Decision of his own countrys Court, which validly exercised jurisdiction over him,
and whose decision he does not repudiate, he is estopped by his own representation before said Court from
asserting his right over the alleged conjugal property. (Emphasis supplied)

88

We reiterated Van Dorn in Pilapil v. Ibay-Somera[29] to dismiss criminal complaints for adultery
filed by the alien divorcee (who obtained the foreign divorce decree) against his former Filipino spouse
because he no longer qualified as offended spouse entitled to file the complaints under Philippine
procedural rules. Thus, it should be clear by now that a foreign divorce decree carries as much validity
against the alien divorcee in this jurisdiction as it does in the jurisdiction of the aliens nationality,
irrespective of who obtained the divorce.
The Facts of the Case and Nature of Proceeding
Justify Remand
Instead of ordering the dismissal of petitioners suit, the logical end to its lack of cause of action, we
remand the case for the trial court to settle the question of Stephanies custody. Stephanie is now nearly 15
years old, thus removing the case outside of the ambit of the mandatory maternal custody regime under
Article 213 and bringing it within coverage of the default standard on child custody proceedings the best
interest of the child.[30] As the question of custody is already before the trial court and the childs parents, by
executing the Agreement, initially showed inclination to share custody, it is in the interest of swift and
efficient rendition of justice to allow the parties to take advantage of the courts jurisdiction, submit evidence
on the custodial arrangement best serving Stephanies interest, and let the trial court render judgment. This
disposition is consistent with the settled doctrine that in child custody proceedings, equity may be invoked to
serve the childs best interest.[31]
WHEREFORE, we REVERSE the Orders dated 1 March 2005 and 23 June 2005 of the Regional
Trial Court of Makati City, Branch 60. The case is REMANDED for further proceedings consistent with this
ruling.
SO ORDERED.

G.R. No. 186571

August 11, 2010

GERBERT R. CORPUZ, Petitioner,


vs.
DAISYLYN TIROL STO. TOMAS and The SOLICITOR GENERAL, Respondents.
DECISION
BRION, J.:
Before the Court is a direct appeal from the decision1 of the Regional Trial Court (RTC) of Laoag City,
Branch 11, elevated via a petition for review on certiorari2 under Rule 45 of the Rules of Court (present
petition).
Petitioner Gerbert R. Corpuz was a former Filipino citizen who acquired Canadian citizenship through
naturalization on November 29, 2000.3 On January 18, 2005, Gerbert married respondent Daisylyn T. Sto.
Tomas, a Filipina, in Pasig City.4 Due to work and other professional commitments, Gerbert left for Canada
soon after the wedding. He returned to the Philippines sometime in April 2005 to surprise Daisylyn, but was
shocked to discover that his wife was having an affair with another man. Hurt and disappointed, Gerbert
returned to Canada and filed a petition for divorce. The Superior Court of Justice, Windsor, Ontario, Canada
granted Gerberts petition for divorce on December 8, 2005. The divorce decree took effect a month later, on
January 8, 2006.5
Two years after the divorce, Gerbert has moved on and has found another Filipina to love. Desirous of
marrying his new Filipina fiance in the Philippines, Gerbert went to the Pasig City Civil Registry Office and
registered the Canadian divorce decree on his and Daisylyns marriage certificate. Despite the registration of
the divorce decree, an official of the National Statistics Office (NSO) informed Gerbert that the marriage
between him and Daisylyn still subsists under Philippine law; to be enforceable, the foreign divorce decree

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must first be judicially recognized by a competent Philippine court, pursuant to NSO Circular No. 4, series of
1982.6
Accordingly, Gerbert filed a petition for judicial recognition of foreign divorce and/or declaration of marriage
as dissolved (petition) with the RTC. Although summoned, Daisylyn did not file any responsive pleading but
submitted instead a notarized letter/manifestation to the trial court. She offered no opposition to Gerberts
petition and, in fact, alleged her desire to file a similar case herself but was prevented by financial and
personal circumstances. She, thus, requested that she be considered as a party-in-interest with a similar prayer
to Gerberts.
In its October 30, 2008 decision,7 the RTC denied Gerberts petition. The RTC concluded that Gerbert was
not the proper party to institute the action for judicial recognition of the foreign divorce decree as he is a
naturalized Canadian citizen. It ruled that only the Filipino spouse can avail of the remedy, under the second
paragraph of Article 26 of the Family Code,8 in order for him or her to be able to remarry under Philippine
law.9 Article 26 of the Family Code reads:
Art. 26. All marriages solemnized outside the Philippines, in accordance with the laws in force in the country
where they were solemnized, and valid there as such, shall also be valid in this country, except those
prohibited under Articles 35(1), (4), (5) and (6), 36, 37 and 38.
Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter
validly obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino spouse shall
likewise have capacity to remarry under Philippine law.
This conclusion, the RTC stated, is consistent with the legislative intent behind the enactment of the second
paragraph of Article 26 of the Family Code, as determined by the Court in Republic v. Orbecido III;10 the
provision was enacted to "avoid the absurd situation where the Filipino spouse remains married to the alien
spouse who, after obtaining a divorce, is no longer married to the Filipino spouse."11
THE PETITION
From the RTCs ruling,12 Gerbert filed the present petition.13
Gerbert asserts that his petition before the RTC is essentially for declaratory relief, similar to that filed in
Orbecido; he, thus, similarly asks for a determination of his rights under the second paragraph of Article 26
of the Family Code. Taking into account the rationale behind the second paragraph of Article 26 of the
Family Code, he contends that the provision applies as well to the benefit of the alien spouse. He claims that
the RTC ruling unduly stretched the doctrine in Orbecido by limiting the standing to file the petition only to
the Filipino spouse an interpretation he claims to be contrary to the essence of the second paragraph of
Article 26 of the Family Code. He considers himself as a proper party, vested with sufficient legal interest, to
institute the case, as there is a possibility that he might be prosecuted for bigamy if he marries his Filipina
fiance in the Philippines since two marriage certificates, involving him, would be on file with the Civil
Registry Office. The Office of the Solicitor General and Daisylyn, in their respective Comments,14 both
support Gerberts position.
Essentially, the petition raises the issue of whether the second paragraph of Article 26 of the Family Code
extends to aliens the right to petition a court of this jurisdiction for the recognition of a foreign divorce
decree.
THE COURTS RULING
The alien spouse can claim no right under the second paragraph of Article 26 of the Family Code as the
substantive right it establishes is in favor of the Filipino spouse
The resolution of the issue requires a review of the legislative history and intent behind the second paragraph
of Article 26 of the Family Code.
The Family Code recognizes only two types of defective marriages void15 and voidable16 marriages. In both
cases, the basis for the judicial declaration of absolute nullity or annulment of the marriage exists before or at

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the time of the marriage. Divorce, on the other hand, contemplates the dissolution of the lawful union for
cause arising after the marriage.17 Our family laws do not recognize absolute divorce between Filipino
citizens.18
Recognizing the reality that divorce is a possibility in marriages between a Filipino and an alien, President
Corazon C. Aquino, in the exercise of her legislative powers under the Freedom Constitution,19 enacted
Executive Order No. (EO) 227, amending Article 26 of the Family Code to its present wording, as follows:
Art. 26. All marriages solemnized outside the Philippines, in accordance with the laws in force in the country
where they were solemnized, and valid there as such, shall also be valid in this country, except those
prohibited under Articles 35(1), (4), (5) and (6), 36, 37 and 38.
Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter
validly obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino spouse shall
likewise have capacity to remarry under Philippine law.
Through the second paragraph of Article 26 of the Family Code, EO 227 effectively incorporated into the law
this Courts holding in Van Dorn v. Romillo, Jr.20 and Pilapil v. Ibay-Somera.21 In both cases, the Court
refused to acknowledge the alien spouses assertion of marital rights after a foreign courts divorce decree
between the alien and the Filipino. The Court, thus, recognized that the foreign divorce had already severed
the marital bond between the spouses. The Court reasoned in Van Dorn v. Romillo that:
To maintain x x x that, under our laws, [the Filipino spouse] has to be considered still married to [the alien
spouse] and still subject to a wife's obligations x x x cannot be just. [The Filipino spouse] should not be
obliged to live together with, observe respect and fidelity, and render support to [the alien spouse]. The latter
should not continue to be one of her heirs with possible rights to conjugal property. She should not be
discriminated against in her own country if the ends of justice are to be served.22
As the RTC correctly stated, the provision was included in the law "to avoid the absurd situation where the
Filipino spouse remains married to the alien spouse who, after obtaining a divorce, is no longer married to the
Filipino spouse."23 The legislative intent is for the benefit of the Filipino spouse, by clarifying his or her
marital status, settling the doubts created by the divorce decree. Essentially, the second paragraph of Article
26 of the Family Code provided the Filipino spouse a substantive right to have his or her marriage to the alien
spouse considered as dissolved, capacitating him or her to remarry.24 Without the second paragraph of Article
26 of the Family Code, the judicial recognition of the foreign decree of divorce, whether in a proceeding
instituted precisely for that purpose or as a related issue in another proceeding, would be of no significance to
the Filipino spouse since our laws do not recognize divorce as a mode of severing the marital bond;25 Article
17 of the Civil Code provides that the policy against absolute divorces cannot be subverted by judgments
promulgated in a foreign country. The inclusion of the second paragraph in Article 26 of the Family Code
provides the direct exception to this rule and serves as basis for recognizing the dissolution of the marriage
between the Filipino spouse and his or her alien spouse.
Additionally, an action based on the second paragraph of Article 26 of the Family Code is not limited to the
recognition of the foreign divorce decree. If the court finds that the decree capacitated the alien spouse to
remarry, the courts can declare that the Filipino spouse is likewise capacitated to contract another marriage.
No court in this jurisdiction, however, can make a similar declaration for the alien spouse (other than that
already established by the decree), whose status and legal capacity are generally governed by his national
law.26
Given the rationale and intent behind the enactment, and the purpose of the second paragraph of Article 26 of
the Family Code, the RTC was correct in limiting the applicability of the provision for the benefit of the
Filipino spouse. In other words, only the Filipino spouse can invoke the second paragraph of Article 26 of the
Family Code; the alien spouse can claim no right under this provision.
The foreign divorce decree is presumptive evidence of a right that clothes the party with legal interest to
petition for its recognition in this jurisdiction
We qualify our above conclusion i.e., that the second paragraph of Article 26 of the Family Code bestows
no rights in favor of aliens with the complementary statement that this conclusion is not sufficient basis to

91

dismiss Gerberts petition before the RTC. In other words, the unavailability of the second paragraph of
Article 26 of the Family Code to aliens does not necessarily strip Gerbert of legal interest to petition the RTC
for the recognition of his foreign divorce decree. The foreign divorce decree itself, after its authenticity and
conformity with the aliens national law have been duly proven according to our rules of evidence, serves as a
presumptive evidence of right in favor of Gerbert, pursuant to Section 48, Rule 39 of the Rules of Court
which provides for the effect of foreign judgments. This Section states:
SEC. 48. Effect of foreign judgments or final orders.The effect of a judgment or final order of a tribunal of
a foreign country, having jurisdiction to render the judgment or final order is as follows:
(a) In case of a judgment or final order upon a specific thing, the judgment or final order is conclusive
upon the title of the thing; and
(b) In case of a judgment or final order against a person, the judgment or final order is presumptive
evidence of a right as between the parties and their successors in interest by a subsequent title.
In either case, the judgment or final order may be repelled by evidence of a want of jurisdiction, want of
notice to the party, collusion, fraud, or clear mistake of law or fact.
To our mind, direct involvement or being the subject of the foreign judgment is sufficient to clothe a party
with the requisite interest to institute an action before our courts for the recognition of the foreign judgment.
In a divorce situation, we have declared, no less, that the divorce obtained by an alien abroad may be
recognized in the Philippines, provided the divorce is valid according to his or her national law.27
The starting point in any recognition of a foreign divorce judgment is the acknowledgment that our courts do
not take judicial notice of foreign judgments and laws. Justice Herrera explained that, as a rule, "no sovereign
is bound to give effect within its dominion to a judgment rendered by a tribunal of another country."28 This
means that the foreign judgment and its authenticity must be proven as facts under our rules on evidence,
together with the aliens applicable national law to show the effect of the judgment on the alien himself or
herself.29 The recognition may be made in an action instituted specifically for the purpose or in another action
where a party invokes the foreign decree as an integral aspect of his claim or defense.
In Gerberts case, since both the foreign divorce decree and the national law of the alien, recognizing his or
her capacity to obtain a divorce, purport to be official acts of a sovereign authority, Section 24, Rule 132 of
the Rules of Court comes into play. This Section requires proof, either by (1) official publications or (2)
copies attested by the officer having legal custody of the documents. If the copies of official records are not
kept in the Philippines, these must be (a) accompanied by a certificate issued by the proper diplomatic or
consular officer in the Philippine foreign service stationed in the foreign country in which the record is kept
and (b) authenticated by the seal of his office.
The records show that Gerbert attached to his petition a copy of the divorce decree, as well as the required
certificates proving its authenticity,30 but failed to include a copy of the Canadian law on divorce.31 Under this
situation, we can, at this point, simply dismiss the petition for insufficiency of supporting evidence, unless we
deem it more appropriate to remand the case to the RTC to determine whether the divorce decree is consistent
with the Canadian divorce law.
We deem it more appropriate to take this latter course of action, given the Article 26 interests that will be
served and the Filipina wifes (Daisylyns) obvious conformity with the petition. A remand, at the same time,
will allow other interested parties to oppose the foreign judgment and overcome a petitioners presumptive
evidence of a right by proving want of jurisdiction, want of notice to a party, collusion, fraud, or clear
mistake of law or fact. Needless to state, every precaution must be taken to ensure conformity with our laws
before a recognition is made, as the foreign judgment, once recognized, shall have the effect of res
judicata32 between the parties, as provided in Section 48, Rule 39 of the Rules of Court.33
In fact, more than the principle of comity that is served by the practice of reciprocal recognition of foreign
judgments between nations, the res judicata effect of the foreign judgments of divorce serves as the deeper
basis for extending judicial recognition and for considering the alien spouse bound by its terms. This same
effect, as discussed above, will not obtain for the Filipino spouse were it not for the substantive rule that the
second paragraph of Article 26 of the Family Code provides.

92

Considerations beyond the recognition of the foreign divorce decree


As a matter of "housekeeping" concern, we note that the Pasig City Civil Registry Office has already
recorded the divorce decree on Gerbert and Daisylyns marriage certificate based on the mere presentation of
the decree.34We consider the recording to be legally improper; hence, the need to draw attention of the bench
and the bar to what had been done.
Article 407 of the Civil Code states that "[a]cts, events and judicial decrees concerning the civil status of
persons shall be recorded in the civil register." The law requires the entry in the civil registry of judicial
decrees that produce legal consequences touching upon a persons legal capacity and status, i.e., those
affecting "all his personal qualities and relations, more or less permanent in nature, not ordinarily terminable
at his own will, such as his being legitimate or illegitimate, or his being married or not."35
A judgment of divorce is a judicial decree, although a foreign one, affecting a persons legal capacity and
status that must be recorded. In fact, Act No. 3753 or the Law on Registry of Civil Status specifically requires
the registration of divorce decrees in the civil registry:
Sec. 1. Civil Register. A civil register is established for recording the civil status of persons, in which shall
be entered:
(a) births;
(b) deaths;
(c) marriages;
(d) annulments of marriages;
(e) divorces;
(f) legitimations;
(g) adoptions;
(h) acknowledgment of natural children;
(i) naturalization; and
(j) changes of name.
xxxx
Sec. 4. Civil Register Books. The local registrars shall keep and preserve in their offices the following
books, in which they shall, respectively make the proper entries concerning the civil status of persons:
(1) Birth and death register;
(2) Marriage register, in which shall be entered not only the marriages solemnized but also divorces
and dissolved marriages.
(3) Legitimation, acknowledgment, adoption, change of name and naturalization register.
But while the law requires the entry of the divorce decree in the civil registry, the law and the submission of
the decree by themselves do not ipso facto authorize the decrees registration. The law should be read in
relation with the requirement of a judicial recognition of the foreign judgment before it can be given res
judicata effect. In the context of the present case, no judicial order as yet exists recognizing the foreign
divorce decree. Thus, the Pasig City Civil Registry Office acted totally out of turn and without authority of
law when it annotated the Canadian divorce decree on Gerbert and Daisylyns marriage certificate, on the
strength alone of the foreign decree presented by Gerbert.

93

Evidently, the Pasig City Civil Registry Office was aware of the requirement of a court recognition, as it cited
NSO Circular No. 4, series of 1982,36 and Department of Justice Opinion No. 181, series of 198237 both of
which required a final order from a competent Philippine court before a foreign judgment, dissolving a
marriage, can be registered in the civil registry, but it, nonetheless, allowed the registration of the decree. For
being contrary to law, the registration of the foreign divorce decree without the requisite judicial recognition
is patently void and cannot produce any legal effect.1avvphi1
Another point we wish to draw attention to is that the recognition that the RTC may extend to the Canadian
divorce decree does not, by itself, authorize the cancellation of the entry in the civil registry. A petition for
recognition of a foreign judgment is not the proper proceeding, contemplated under the Rules of Court, for
the cancellation of entries in the civil registry.
Article 412 of the Civil Code declares that "no entry in a civil register shall be changed or corrected, without
judicial order." The Rules of Court supplements Article 412 of the Civil Code by specifically providing for a
special remedial proceeding by which entries in the civil registry may be judicially cancelled or corrected.
Rule 108 of the Rules of Court sets in detail the jurisdictional and procedural requirements that must be
complied with before a judgment, authorizing the cancellation or correction, may be annotated in the civil
registry. It also requires, among others, that the verified petition must be filed with the RTC of the province
where the corresponding civil registry is located;38 that the civil registrar and all persons who have or claim
any interest must be made parties to the proceedings;39 and that the time and place for hearing must be
published in a newspaper of general circulation.40As these basic jurisdictional requirements have not been
met in the present case, we cannot consider the petition Gerbert filed with the RTC as one filed under Rule
108 of the Rules of Court.
We hasten to point out, however, that this ruling should not be construed as requiring two separate
proceedings for the registration of a foreign divorce decree in the civil registry one for recognition of the
foreign decree and another specifically for cancellation of the entry under Rule 108 of the Rules of Court.
The recognition of the foreign divorce decree may be made in a Rule 108 proceeding itself, as the object of
special proceedings (such as that in Rule 108 of the Rules of Court) is precisely to establish the status or right
of a party or a particular fact. Moreover, Rule 108 of the Rules of Court can serve as the appropriate
adversarial proceeding41 by which the applicability of the foreign judgment can be measured and tested in
terms of jurisdictional infirmities, want of notice to the party, collusion, fraud, or clear mistake of law or fact.
WHEREFORE, we GRANT the petition for review on certiorari, and REVERSE the October 30, 2008
decision of the Regional Trial Court of Laoag City, Branch 11, as well as its February 17, 2009 order. We
order the REMAND of the case to the trial court for further proceedings in accordance with our ruling above.
Let a copy of this Decision be furnished the Civil Registrar General. No costs.
SO ORDERED.

G.R. No. 80116 June 30, 1989


IMELDA MANALAYSAY PILAPIL, petitioner,
vs.
HON. CORONA IBAY-SOMERA, in her capacity as Presiding Judge of the Regional Trial Court of Manila,
Branch XXVI; HON. LUIS C. VICTOR, in his capacity as the City Fiscal of Manila; and ERICH
EKKEHARD GEILING, respondents.

REGALADO, J.:
An ill-starred marriage of a Filipina and a foreigner which ended in a foreign absolute divorce, only to be
followed by a criminal infidelity suit of the latter against the former, provides Us the opportunity to lay down
a decisional rule on what hitherto appears to be an unresolved jurisdictional question.

94

On September 7, 1979, petitioner Imelda Manalaysay Pilapil, a Filipino citizen, and private respondent Erich
Ekkehard Geiling, a German national, were married before the Registrar of Births, Marriages and Deaths at
Friedensweiler in the Federal Republic of Germany. The marriage started auspiciously enough, and the
couple lived together for some time in Malate, Manila where their only child, Isabella Pilapil Geiling, was
born on April 20, 1980. 1
Thereafter, marital discord set in, with mutual recriminations between the spouses, followed by a separation
de facto between them.
After about three and a half years of marriage, such connubial disharmony eventuated in private respondent
initiating a divorce proceeding against petitioner in Germany before the Schoneberg Local Court in January,
1983. He claimed that there was failure of their marriage and that they had been living apart since April,
1982. 2
Petitioner, on the other hand, filed an action for legal separation, support and separation of property before
the Regional Trial Court of Manila, Branch XXXII, on January 23, 1983 where the same is still pending as
Civil Case No. 83-15866. 3
On January 15, 1986, Division 20 of the Schoneberg Local Court, Federal Republic of Germany,
promulgated a decree of divorce on the ground of failure of marriage of the spouses. The custody of the child
was granted to petitioner. The records show that under German law said court was locally and internationally
competent for the divorce proceeding and that the dissolution of said marriage was legally founded on and
authorized by the applicable law of that foreign jurisdiction. 4
On June 27, 1986, or more than five months after the issuance of the divorce decree, private respondent filed
two complaints for adultery before the City Fiscal of Manila alleging that, while still married to said
respondent, petitioner "had an affair with a certain William Chia as early as 1982 and with yet another man
named Jesus Chua sometime in 1983". Assistant Fiscal Jacinto A. de los Reyes, Jr., after the corresponding
investigation, recommended the dismissal of the cases on the ground of insufficiency of evidence. 5 However,
upon review, the respondent city fiscal approved a resolution, dated January 8, 1986, directing the filing of
two complaints for adultery against the petitioner. 6 The complaints were accordingly filed and were
eventually raffled to two branches of the Regional Trial Court of Manila. The case entitled "People of the
Philippines vs. Imelda Pilapil and William Chia", docketed as Criminal Case No. 87-52435, was assigned to
Branch XXVI presided by the respondent judge; while the other case, "People of the Philippines vs. Imelda
Pilapil and James Chua", docketed as Criminal Case No. 87-52434 went to the sala of Judge Leonardo Cruz,
Branch XXV, of the same court. 7
On March 14, 1987, petitioner filed a petition with the Secretary of Justice asking that the aforesaid
resolution of respondent fiscal be set aside and the cases against her be dismissed. 8 A similar petition was
filed by James Chua, her co-accused in Criminal Case No. 87-52434. The Secretary of Justice, through the
Chief State Prosecutor, gave due course to both petitions and directed the respondent city fiscal to inform the
Department of Justice "if the accused have already been arraigned and if not yet arraigned, to move to defer
further proceedings" and to elevate the entire records of both cases to his office for review. 9
Petitioner thereafter filed a motion in both criminal cases to defer her arraignment and to suspend further
proceedings thereon. 10 As a consequence, Judge Leonardo Cruz suspended proceedings in Criminal Case No.
87-52434. On the other hand, respondent judge merely reset the date of the arraignment in Criminal Case No.
87-52435 to April 6, 1987. Before such scheduled date, petitioner moved for the cancellation of the
arraignment and for the suspension of proceedings in said Criminal Case No. 87-52435 until after the
resolution of the petition for review then pending before the Secretary of Justice. 11 A motion to quash was
also filed in the same case on the ground of lack of jurisdiction, 12 which motion was denied by the
respondent judge in an order dated September 8, 1987. The same order also directed the arraignment of both
accused therein, that is, petitioner and William Chia. The latter entered a plea of not guilty while the
petitioner refused to be arraigned. Such refusal of the petitioner being considered by respondent judge as
direct contempt, she and her counsel were fined and the former was ordered detained until she submitted
herself for arraignment. 13 Later, private respondent entered a plea of not guilty. 14
On October 27, 1987, petitioner filed this special civil action for certiorari and prohibition, with a prayer for
a temporary restraining order, seeking the annulment of the order of the lower court denying her motion to

95

quash. The petition is anchored on the main ground that the court is without jurisdiction "to try and decide the
charge of adultery, which is a private offense that cannot be prosecuted de officio (sic), since the purported
complainant, a foreigner, does not qualify as an offended spouse having obtained a final divorce decree under
his national law prior to his filing the criminal complaint." 15
On October 21, 1987, this Court issued a temporary restraining order enjoining the respondents from
implementing the aforesaid order of September 8, 1987 and from further proceeding with Criminal Case No.
87-52435. Subsequently, on March 23, 1988 Secretary of Justice Sedfrey A. Ordoez acted on the aforesaid
petitions for review and, upholding petitioner's ratiocinations, issued a resolution directing the respondent
city fiscal to move for the dismissal of the complaints against the petitioner. 16
We find this petition meritorious. The writs prayed for shall accordingly issue.
Under Article 344 of the Revised Penal Code, 17 the crime of adultery, as well as four other crimes against
chastity, cannot be prosecuted except upon a sworn written complaint filed by the offended spouse. It has
long since been established, with unwavering consistency, that compliance with this rule is a jurisdictional,
and not merely a formal, requirement. 18 While in point of strict law the jurisdiction of the court over the
offense is vested in it by the Judiciary Law, the requirement for a sworn written complaint is just as
jurisdictional a mandate since it is that complaint which starts the prosecutory proceeding 19 and without
which the court cannot exercise its jurisdiction to try the case.
Now, the law specifically provides that in prosecutions for adultery and concubinage the person who can
legally file the complaint should be the offended spouse, and nobody else. Unlike the offenses of seduction,
abduction, rape and acts of lasciviousness, no provision is made for the prosecution of the crimes of adultery
and concubinage by the parents, grandparents or guardian of the offended party. The so-called exclusive and
successive rule in the prosecution of the first four offenses above mentioned do not apply to adultery and
concubinage. It is significant that while the State, as parens patriae, was added and vested by the 1985 Rules
of Criminal Procedure with the power to initiate the criminal action for a deceased or incapacitated victim in
the aforesaid offenses of seduction, abduction, rape and acts of lasciviousness, in default of her parents,
grandparents or guardian, such amendment did not include the crimes of adultery and concubinage. In other
words, only the offended spouse, and no other, is authorized by law to initiate the action therefor.
Corollary to such exclusive grant of power to the offended spouse to institute the action, it necessarily
follows that such initiator must have the status, capacity or legal representation to do so at the time of the
filing of the criminal action. This is a familiar and express rule in civil actions; in fact, lack of legal capacity
to sue, as a ground for a motion to dismiss in civil cases, is determined as of the filing of the complaint or
petition.
The absence of an equivalent explicit rule in the prosecution of criminal cases does not mean that the same
requirement and rationale would not apply. Understandably, it may not have been found necessary since
criminal actions are generally and fundamentally commenced by the State, through the People of the
Philippines, the offended party being merely the complaining witness therein. However, in the so-called
"private crimes" or those which cannot be prosecuted de oficio, and the present prosecution for adultery is of
such genre, the offended spouse assumes a more predominant role since the right to commence the action, or
to refrain therefrom, is a matter exclusively within his power and option.
This policy was adopted out of consideration for the aggrieved party who might prefer to suffer the outrage in
silence rather than go through the scandal of a public trial. 20 Hence, as cogently argued by petitioner, Article
344 of the Revised Penal Code thus presupposes that the marital relationship is still subsisting at the time of
the institution of the criminal action for, adultery. This is a logical consequence since the raison d'etre of said
provision of law would be absent where the supposed offended party had ceased to be the spouse of the
alleged offender at the time of the filing of the criminal case. 21
In these cases, therefore, it is indispensable that the status and capacity of the complainant to commence the
action be definitely established and, as already demonstrated, such status or capacity must indubitably exist
as of the time he initiates the action. It would be absurd if his capacity to bring the action would be
determined by his status before or subsequent to the commencement thereof, where such capacity or status
existed prior to but ceased before, or was acquired subsequent to but did not exist at the time of, the

96

institution of the case. We would thereby have the anomalous spectacle of a party bringing suit at the very
time when he is without the legal capacity to do so.
To repeat, there does not appear to be any local precedential jurisprudence on the specific issue as to when
precisely the status of a complainant as an offended spouse must exist where a criminal prosecution can be
commenced only by one who in law can be categorized as possessed of such status. Stated differently and
with reference to the present case, the inquiry ;would be whether it is necessary in the commencement of a
criminal action for adultery that the marital bonds between the complainant and the accused be unsevered and
existing at the time of the institution of the action by the former against the latter.
American jurisprudence, on cases involving statutes in that jurisdiction which are in pari materia with ours,
yields the rule that after a divorce has been decreed, the innocent spouse no longer has the right to institute
proceedings against the offenders where the statute provides that the innocent spouse shall have the exclusive
right to institute a prosecution for adultery. Where, however, proceedings have been properly commenced, a
divorce subsequently granted can have no legal effect on the prosecution of the criminal proceedings to a
conclusion. 22
In the cited Loftus case, the Supreme Court of Iowa held that
'No prosecution for adultery can be commenced except on the complaint of the husband or
wife.' Section 4932, Code. Though Loftus was husband of defendant when the offense is said
to have been committed, he had ceased to be such when the prosecution was begun; and
appellant insists that his status was not such as to entitle him to make the complaint. We have
repeatedly said that the offense is against the unoffending spouse, as well as the state, in
explaining the reason for this provision in the statute; and we are of the opinion that the
unoffending spouse must be such when the prosecution is commenced. (Emphasis supplied.)
We see no reason why the same doctrinal rule should not apply in this case and in our jurisdiction,
considering our statutory law and jural policy on the matter. We are convinced that in cases of such nature,
the status of the complainant vis-a-vis the accused must be determined as of the time the complaint was filed.
Thus, the person who initiates the adultery case must be an offended spouse, and by this is meant that he is
still married to the accused spouse, at the time of the filing of the complaint.
In the present case, the fact that private respondent obtained a valid divorce in his country, the Federal
Republic of Germany, is admitted. Said divorce and its legal effects may be recognized in the Philippines
insofar as private respondent is concerned 23 in view of the nationality principle in our civil law on the matter
of status of persons.
Thus, in the recent case of Van Dorn vs. Romillo, Jr., et al., 24 after a divorce was granted by a United States
court between Alice Van Dornja Filipina, and her American husband, the latter filed a civil case in a trial
court here alleging that her business concern was conjugal property and praying that she be ordered to render
an accounting and that the plaintiff be granted the right to manage the business. Rejecting his pretensions,
this Court perspicuously demonstrated the error of such stance, thus:
There can be no question as to the validity of that Nevada divorce in any of the States of the
United States. The decree is binding on private respondent as an American citizen. For
instance, private respondent cannot sue petitioner, as her husband, in any State of the Union. ...
It is true that owing to the nationality principle embodied in Article 15 of the Civil Code, only
Philippine nationals are covered by the policy against absolute divorces the same being
considered contrary to our concept of public policy and morality. However, aliens may obtain
divorces abroad, which may be recognized in the Philippines, provided they are valid
according to their national law. ...
Thus, pursuant to his national law, private respondent is no longer the husband of petitioner.
He would have no standing to sue in the case below as petitioner's husband entitled to exercise
control over conjugal assets. ...25

97

Under the same considerations and rationale, private respondent, being no longer the husband of petitioner,
had no legal standing to commence the adultery case under the imposture that he was the offended spouse at
the time he filed suit.
The allegation of private respondent that he could not have brought this case before the decree of divorce for
lack of knowledge, even if true, is of no legal significance or consequence in this case. When said respondent
initiated the divorce proceeding, he obviously knew that there would no longer be a family nor marriage
vows to protect once a dissolution of the marriage is decreed. Neither would there be a danger of introducing
spurious heirs into the family, which is said to be one of the reasons for the particular formulation of our law
on adultery, 26 since there would thenceforth be no spousal relationship to speak of. The severance of the
marital bond had the effect of dissociating the former spouses from each other, hence the actuations of one
would not affect or cast obloquy on the other.
The aforecited case of United States vs. Mata cannot be successfully relied upon by private respondent. In
applying Article 433 of the old Penal Code, substantially the same as Article 333 of the Revised Penal Code,
which punished adultery "although the marriage be afterwards declared void", the Court merely stated that
"the lawmakers intended to declare adulterous the infidelity of a married woman to her marital vows, even
though it should be made to appear that she is entitled to have her marriage contract declared null and void,
until and unless she actually secures a formal judicial declaration to that effect". Definitely, it cannot be
logically inferred therefrom that the complaint can still be filed after the declaration of nullity because such
declaration that the marriage is void ab initio is equivalent to stating that it never existed. There being no
marriage from the beginning, any complaint for adultery filed after said declaration of nullity would no
longer have a leg to stand on. Moreover, what was consequently contemplated and within the purview of the
decision in said case is the situation where the criminal action for adultery was filed before the termination of
the marriage by a judicial declaration of its nullity ab initio. The same rule and requisite would necessarily
apply where the termination of the marriage was effected, as in this case, by a valid foreign divorce.
Private respondent's invocation of Donio-Teves, et al. vs. Vamenta, hereinbefore cited, 27 must suffer the same
fate of inapplicability. A cursory reading of said case reveals that the offended spouse therein had duly and
seasonably filed a complaint for adultery, although an issue was raised as to its sufficiency but which was
resolved in favor of the complainant. Said case did not involve a factual situation akin to the one at bar or any
issue determinative of the controversy herein.
WHEREFORE, the questioned order denying petitioner's motion to quash is SET ASIDE and another one
enteredDISMISSING the complaint in Criminal Case No. 87-52435 for lack of jurisdiction. The temporary
restraining order issued in this case on October 21, 1987 is hereby made permanent.
SO ORDERED.
Pilapil vs Ibay-Somera
TITLE: Imelda Manalaysay Pilapil v Hon. Corona Ibay-Somera
CITATION: GR No. 80116, June 30, 1989| 174 SCRA 653
FACTS:
Imelda M. Pilapil, a Filipino citizen, was married with private respondent, Erich Ekkehard Geiling, a German
national before the Registrar of Births, Marriages and Deaths at Friedensweiler, Federal Republic of
Germany. They have a child who was born on April 20, 1980 and named Isabella Pilapil Geiling. Conjugal
disharmony eventuated in private respondent and he initiated a divorce proceeding against petitioner in
Germany before the Schoneberg Local Court in January 1983. The petitioner then filed an action for legal
separation, support and separation of property before the RTC Manila on January 23, 1983.
The decree of divorce was promulgated on January 15, 1986 on the ground of failure of marriage of the
spouses. The custody of the child was granted to the petitioner.
On June 27, 1986, private respondent filed 2 complaints for adultery before the City Fiscal of Manila alleging
that while still married to Imelda, latter had an affair with William Chia as early as 1982 and another man
named Jesus Chua sometime in 1983.

98

ISSUE: Whether private respondent can prosecute petitioner on the ground of adultery even though they are
no longer husband and wife as decree of divorce was already issued.

HELD:
The law specifically provided that in prosecution for adultery and concubinage, the person who can legally
file the complaint should be the offended spouse and nobody else. Though in this case, it appeared that
private respondent is the offended spouse, the latter obtained a valid divorce in his country, the Federal
Republic of Germany, and said divorce and its legal effects may be recognized in the Philippines in so far as
he is concerned. Thus, under the same consideration and rationale, private respondent is no longer the
husband of petitioner and has no legal standing to commence the adultery case under the imposture that he
was the offended spouse at the time he filed suit.

G.R. No. L-16749

January 31, 1963

IN THE MATTER OF THE TESTATE ESTATE OF EDWARD E. CHRISTENSEN, DECEASED.


ADOLFO C. AZNAR, Executor and LUCY CHRISTENSEN, Heir of the deceased, Executor and Heirappellees,
vs.
HELEN CHRISTENSEN GARCIA, oppositor-appellant.
M. R. Sotelo for executor and heir-appellees.
Leopoldo M. Abellera and Jovito Salonga for oppositor-appellant.
LABRADOR, J.:
This is an appeal from a decision of the Court of First Instance of Davao, Hon. Vicente N. Cusi, Jr., presiding,
in Special Proceeding No. 622 of said court, dated September 14, 1949, approving among things the final
accounts of the executor, directing the executor to reimburse Maria Lucy Christensen the amount of P3,600
paid by her to Helen Christensen Garcia as her legacy, and declaring Maria Lucy Christensen entitled to the
residue of the property to be enjoyed during her lifetime, and in case of death without issue, one-half of said
residue to be payable to Mrs. Carrie Louise C. Borton, etc., in accordance with the provisions of the will of
the testator Edward E. Christensen. The will was executed in Manila on March 5, 1951 and contains the
following provisions:
3. I declare ... that I have but ONE (1) child, named MARIA LUCY CHRISTENSEN (now Mrs.
Bernard Daney), who was born in the Philippines about twenty-eight years ago, and who is now
residing at No. 665 Rodger Young Village, Los Angeles, California, U.S.A.
4. I further declare that I now have no living ascendants, and no descendants except my above named
daughter, MARIA LUCY CHRISTENSEN DANEY.
xxx

xxx

xxx

7. I give, devise and bequeath unto MARIA HELEN CHRISTENSEN, now married to Eduardo
Garcia, about eighteen years of age and who, notwithstanding the fact that she was baptized
Christensen, is not in any way related to me, nor has she been at any time adopted by me, and who,
from all information I have now resides in Egpit, Digos, Davao, Philippines, the sum of THREE
THOUSAND SIX HUNDRED PESOS (P3,600.00), Philippine Currency the same to be deposited in
trust for the said Maria Helen Christensen with the Davao Branch of the Philippine National Bank,
and paid to her at the rate of One Hundred Pesos (P100.00), Philippine Currency per month until the
principal thereof as well as any interest which may have accrued thereon, is exhausted..

99

xxx

xxx

xxx

12. I hereby give, devise and bequeath, unto my well-beloved daughter, the said MARIA LUCY
CHRISTENSEN DANEY (Mrs. Bernard Daney), now residing as aforesaid at No. 665 Rodger Young
Village, Los Angeles, California, U.S.A., all the income from the rest, remainder, and residue of my
property and estate, real, personal and/or mixed, of whatsoever kind or character, and wheresoever
situated, of which I may be possessed at my death and which may have come to me from any source
whatsoever, during her lifetime: ....
It is in accordance with the above-quoted provisions that the executor in his final account and project of
partition ratified the payment of only P3,600 to Helen Christensen Garcia and proposed that the residue of the
estate be transferred to his daughter, Maria Lucy Christensen.
Opposition to the approval of the project of partition was filed by Helen Christensen Garcia, insofar as it
deprives her (Helen) of her legitime as an acknowledged natural child, she having been declared by Us in
G.R. Nos. L-11483-84 an acknowledged natural child of the deceased Edward E. Christensen. The legal
grounds of opposition are (a) that the distribution should be governed by the laws of the Philippines, and (b)
that said order of distribution is contrary thereto insofar as it denies to Helen Christensen, one of two
acknowledged natural children, one-half of the estate in full ownership. In amplification of the above grounds
it was alleged that the law that should govern the estate of the deceased Christensen should not be the internal
law of California alone, but the entire law thereof because several foreign elements are involved, that the
forum is the Philippines and even if the case were decided in California, Section 946 of the California Civil
Code, which requires that the domicile of the decedent should apply, should be applicable. It was also alleged
that Maria Helen Christensen having been declared an acknowledged natural child of the decedent, she is
deemed for all purposes legitimate from the time of her birth.
The court below ruled that as Edward E. Christensen was a citizen of the United States and of the State of
California at the time of his death, the successional rights and intrinsic validity of the provisions in his will
are to be governed by the law of California, in accordance with which a testator has the right to dispose of his
property in the way he desires, because the right of absolute dominion over his property is sacred and
inviolable (In re McDaniel's Estate, 77 Cal. Appl. 2d 877, 176 P. 2d 952, and In re Kaufman, 117 Cal. 286, 49
Pac. 192, cited in page 179, Record on Appeal). Oppositor Maria Helen Christensen, through counsel, filed
various motions for reconsideration, but these were denied. Hence, this appeal.
The most important assignments of error are as follows:
I
THE LOWER COURT ERRED IN IGNORING THE DECISION OF THE HONORABLE SUPREME
COURT THAT HELEN IS THE ACKNOWLEDGED NATURAL CHILD OF EDWARD E.
CHRISTENSEN AND, CONSEQUENTLY, IN DEPRIVING HER OF HER JUST SHARE IN THE
INHERITANCE.
II
THE LOWER COURT ERRED IN ENTIRELY IGNORING AND/OR FAILING TO RECOGNIZE THE
EXISTENCE OF SEVERAL FACTORS, ELEMENTS AND CIRCUMSTANCES CALLING FOR THE
APPLICATION OF INTERNAL LAW.
III
THE LOWER COURT ERRED IN FAILING TO RECOGNIZE THAT UNDER INTERNATIONAL LAW,
PARTICULARLY UNDER THE RENVOI DOCTRINE, THE INTRINSIC VALIDITY OF THE
TESTAMENTARY DISPOSITION OF THE DISTRIBUTION OF THE ESTATE OF THE DECEASED
EDWARD E. CHRISTENSEN SHOULD BE GOVERNED BY THE LAWS OF THE PHILIPPINES.
IV

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THE LOWER COURT ERRED IN NOT DECLARING THAT THE SCHEDULE OF DISTRIBUTION
SUBMITTED BY THE EXECUTOR IS CONTRARY TO THE PHILIPPINE LAWS.
V
THE LOWER COURT ERRED IN NOT DECLARING THAT UNDER THE PHILIPPINE LAWS HELEN
CHRISTENSEN GARCIA IS ENTITLED TO ONE-HALF (1/2) OF THE ESTATE IN FULL OWNERSHIP.
There is no question that Edward E. Christensen was a citizen of the United States and of the State of
California at the time of his death. But there is also no question that at the time of his death he was domiciled
in the Philippines, as witness the following facts admitted by the executor himself in appellee's brief:
In the proceedings for admission of the will to probate, the facts of record show that the deceased
Edward E. Christensen was born on November 29, 1875 in New York City, N.Y., U.S.A.; his first
arrival in the Philippines, as an appointed school teacher, was on July 1, 1901, on board the U.S.
Army Transport "Sheridan" with Port of Embarkation as the City of San Francisco, in the State of
California, U.S.A. He stayed in the Philippines until 1904.
In December, 1904, Mr. Christensen returned to the United States and stayed there for the following
nine years until 1913, during which time he resided in, and was teaching school in Sacramento,
California.
Mr. Christensen's next arrival in the Philippines was in July of the year 1913. However, in 1928, he
again departed the Philippines for the United States and came back here the following year, 1929.
Some nine years later, in 1938, he again returned to his own country, and came back to the Philippines
the following year, 1939.
Wherefore, the parties respectfully pray that the foregoing stipulation of facts be admitted and
approved by this Honorable Court, without prejudice to the parties adducing other evidence to prove
their case not covered by this stipulation of facts. 1wph1.t
Being an American citizen, Mr. Christensen was interned by the Japanese Military Forces in the
Philippines during World War II. Upon liberation, in April 1945, he left for the United States but
returned to the Philippines in December, 1945. Appellees Collective Exhibits "6", CFI Davao, Sp.
Proc. 622, as Exhibits "AA", "BB" and "CC-Daney"; Exhs. "MM", "MM-l", "MM-2-Daney" and p.
473, t.s.n., July 21, 1953.)
In April, 1951, Edward E. Christensen returned once more to California shortly after the making of
his last will and testament (now in question herein) which he executed at his lawyers' offices in
Manila on March 5, 1951. He died at the St. Luke's Hospital in the City of Manila on April 30, 1953.
(pp. 2-3)
In arriving at the conclusion that the domicile of the deceased is the Philippines, we are persuaded by the fact
that he was born in New York, migrated to California and resided there for nine years, and since he came to
the Philippines in 1913 he returned to California very rarely and only for short visits (perhaps to relatives),
and considering that he appears never to have owned or acquired a home or properties in that state, which
would indicate that he would ultimately abandon the Philippines and make home in the State of California.
Sec. 16. Residence is a term used with many shades of meaning from mere temporary presence to the
most permanent abode. Generally, however, it is used to denote something more than mere physical
presence. (Goodrich on Conflict of Laws, p. 29)
As to his citizenship, however, We find that the citizenship that he acquired in California when he resided in
Sacramento, California from 1904 to 1913, was never lost by his stay in the Philippines, for the latter was a
territory of the United States (not a state) until 1946 and the deceased appears to have considered himself as a
citizen of California by the fact that when he executed his will in 1951 he declared that he was a citizen of
that State; so that he appears never to have intended to abandon his California citizenship by acquiring
another. This conclusion is in accordance with the following principle expounded by Goodrich in his Conflict
of Laws.

101

The terms "'residence" and "domicile" might well be taken to mean the same thing, a place of
permanent abode. But domicile, as has been shown, has acquired a technical meaning. Thus one may
be domiciled in a place where he has never been. And he may reside in a place where he has no
domicile. The man with two homes, between which he divides his time, certainly resides in each one,
while living in it. But if he went on business which would require his presence for several weeks or
months, he might properly be said to have sufficient connection with the place to be called a resident.
It is clear, however, that, if he treated his settlement as continuing only for the particular business in
hand, not giving up his former "home," he could not be a domiciled New Yorker. Acquisition of a
domicile of choice requires the exercise of intention as well as physical presence. "Residence simply
requires bodily presence of an inhabitant in a given place, while domicile requires bodily presence in
that place and also an intention to make it one's domicile." Residence, however, is a term used with
many shades of meaning, from the merest temporary presence to the most permanent abode, and it is
not safe to insist that any one use et the only proper one. (Goodrich, p. 29)
The law that governs the validity of his testamentary dispositions is defined in Article 16 of the Civil Code of
the Philippines, which is as follows:
ART. 16. Real property as well as personal property is subject to the law of the country where it is
situated.
However, intestate and testamentary successions, both with respect to the order of succession and to
the amount of successional rights and to the intrinsic validity of testamentary provisions, shall be
regulated by the national law of the person whose succession is under consideration, whatever may be
the nature of the property and regardless of the country where said property may be found.
The application of this article in the case at bar requires the determination of the meaning of the
term "national law" is used therein.
There is no single American law governing the validity of testamentary provisions in the United States, each
state of the Union having its own private law applicable to its citizens only and in force only within the state.
The "national law" indicated in Article 16 of the Civil Code above quoted can not, therefore, possibly mean
or apply to any general American law. So it can refer to no other than the private law of the State of
California.
The next question is: What is the law in California governing the disposition of personal property? The
decision of the court below, sustains the contention of the executor-appellee that under the California Probate
Code, a testator may dispose of his property by will in the form and manner he desires, citing the case of
Estate of McDaniel, 77 Cal. Appl. 2d 877, 176 P. 2d 952. But appellant invokes the provisions of Article 946
of the Civil Code of California, which is as follows:
If there is no law to the contrary, in the place where personal property is situated, it is deemed to
follow the person of its owner, and is governed by the law of his domicile.
The existence of this provision is alleged in appellant's opposition and is not denied. We have checked it in
the California Civil Code and it is there. Appellee, on the other hand, relies on the case cited in the decision
and testified to by a witness. (Only the case of Kaufman is correctly cited.) It is argued on executor's behalf
that as the deceased Christensen was a citizen of the State of California, the internal law thereof, which is that
given in the abovecited case, should govern the determination of the validity of the testamentary provisions
of Christensen's will, such law being in force in the State of California of which Christensen was a citizen.
Appellant, on the other hand, insists that Article 946 should be applicable, and in accordance therewith and
following the doctrine of therenvoi, the question of the validity of the testamentary provision in question
should be referred back to the law of the decedent's domicile, which is the Philippines.
The theory of doctrine of renvoi has been defined by various authors, thus:
The problem has been stated in this way: "When the Conflict of Laws rule of the forum refers a jural
matter to a foreign law for decision, is the reference to the purely internal rules of law of the foreign
system; i.e., to the totality of the foreign law minus its Conflict of Laws rules?"

102

On logic, the solution is not an easy one. The Michigan court chose to accept the renvoi, that is,
applied the Conflict of Laws rule of Illinois which referred the matter back to Michigan law. But once
having determined the the Conflict of Laws principle is the rule looked to, it is difficult to see why the
reference back should not have been to Michigan Conflict of Laws. This would have resulted in the
"endless chain of references" which has so often been criticized be legal writers. The opponents of the
renvoi would have looked merely to the internal law of Illinois, thus rejecting the renvoi or the
reference back. Yet there seems no compelling logical reason why the original reference should be the
internal law rather than to the Conflict of Laws rule. It is true that such a solution avoids going on a
merry-go-round, but those who have accepted the renvoi theory avoid this inextricabilis circulas by
getting off at the second reference and at that point applying internal law. Perhaps the opponents of
the renvoi are a bit more consistent for they look always to internal law as the rule of reference.
Strangely enough, both the advocates for and the objectors to the renvoi plead that greater uniformity
will result from adoption of their respective views. And still more strange is the fact that the only way
to achieve uniformity in this choice-of-law problem is if in the dispute the two states whose laws form
the legal basis of the litigation disagree as to whether the renvoi should be accepted. If both reject, or
both accept the doctrine, the result of the litigation will vary with the choice of the forum. In the case
stated above, had the Michigan court rejected the renvoi, judgment would have been against the
woman; if the suit had been brought in the Illinois courts, and they too rejected the renvoi, judgment
would be for the woman. The same result would happen, though the courts would switch with respect
to which would hold liability, if both courts accepted the renvoi.
The Restatement accepts the renvoi theory in two instances: where the title to land is in question, and
where the validity of a decree of divorce is challenged. In these cases the Conflict of Laws rule of the
situs of the land, or the domicile of the parties in the divorce case, is applied by the forum, but any
further reference goes only to the internal law. Thus, a person's title to land, recognized by the situs,
will be recognized by every court; and every divorce, valid by the domicile of the parties, will be
valid everywhere. (Goodrich, Conflict of Laws, Sec. 7, pp. 13-14.)
X, a citizen of Massachusetts, dies intestate, domiciled in France, leaving movable property in
Massachusetts, England, and France. The question arises as to how this property is to be distributed
among X's next of kin.
Assume (1) that this question arises in a Massachusetts court. There the rule of the conflict of laws as
to intestate succession to movables calls for an application of the law of the deceased's last domicile.
Since by hypothesis X's last domicile was France, the natural thing for the Massachusetts court to do
would be to turn to French statute of distributions, or whatever corresponds thereto in French law, and
decree a distribution accordingly. An examination of French law, however, would show that if a
French court were called upon to determine how this property should be distributed, it would refer the
distribution to the national law of the deceased, thus applying the Massachusetts statute of
distributions. So on the surface of things the Massachusetts court has open to it alternative course of
action: (a) either to apply the French law is to intestate succession, or (b) to resolve itself into a
French court and apply the Massachusetts statute of distributions, on the assumption that this is what a
French court would do. If it accepts the so-called renvoidoctrine, it will follow the latter course, thus
applying its own law.
This is one type of renvoi. A jural matter is presented which the conflict-of-laws rule of the forum
refers to a foreign law, the conflict-of-laws rule of which, in turn, refers the matter back again to the
law of the forum. This is renvoi in the narrower sense. The German term for this judicial process is
'Ruckverweisung.'" (Harvard Law Review, Vol. 31, pp. 523-571.)
After a decision has been arrived at that a foreign law is to be resorted to as governing a particular
case, the further question may arise: Are the rules as to the conflict of laws contained in such foreign
law also to be resorted to? This is a question which, while it has been considered by the courts in but a
few instances, has been the subject of frequent discussion by textwriters and essayists; and the
doctrine involved has been descriptively designated by them as the "Renvoyer" to send back, or the
"Ruchversweisung", or the "Weiterverweisung", since an affirmative answer to the question
postulated and the operation of the adoption of the foreign law in toto would in many cases result in
returning the main controversy to be decided according to the law of the forum. ... (16 C.J.S. 872.)

103

Another theory, known as the "doctrine of renvoi", has been advanced. The theory of the doctrine
of renvoiis that the court of the forum, in determining the question before it, must take into account
the whole law of the other jurisdiction, but also its rules as to conflict of laws, and then apply the law
to the actual question which the rules of the other jurisdiction prescribe. This may be the law of the
forum. The doctrine of therenvoi has generally been repudiated by the American authorities. (2 Am.
Jur. 296)
The scope of the theory of renvoi has also been defined and the reasons for its application in a country
explained by Prof. Lorenzen in an article in the Yale Law Journal, Vol. 27, 1917-1918, pp. 529-531. The
pertinent parts of the article are quoted herein below:
The recognition of the renvoi theory implies that the rules of the conflict of laws are to be understood
as incorporating not only the ordinary or internal law of the foreign state or country, but its rules of
the conflict of laws as well. According to this theory 'the law of a country' means the whole of its law.
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Von Bar presented his views at the meeting of the Institute of International Law, at Neuchatel, in
1900, in the form of the following theses:
(1) Every court shall observe the law of its country as regards the application of foreign laws.
(2) Provided that no express provision to the contrary exists, the court shall respect:
(a) The provisions of a foreign law which disclaims the right to bind its nationals abroad as
regards their personal statute, and desires that said personal statute shall be determined by the
law of the domicile, or even by the law of the place where the act in question occurred.
(b) The decision of two or more foreign systems of law, provided it be certain that one of them
is necessarily competent, which agree in attributing the determination of a question to the
same system of law.
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If, for example, the English law directs its judge to distribute the personal estate of an Englishman
who has died domiciled in Belgium in accordance with the law of his domicile, he must first inquire
whether the law of Belgium would distribute personal property upon death in accordance with the law
of domicile, and if he finds that the Belgian law would make the distribution in accordance with the
law of nationality that is the English law he must accept this reference back to his own law.
We note that Article 946 of the California Civil Code is its conflict of laws rule, while the rule applied in In re
Kaufman, Supra, its internal law. If the law on succession and the conflict of laws rules of California are to
be enforced jointly, each in its own intended and appropriate sphere, the principle cited In re Kaufman should
apply to citizens living in the State, but Article 946 should apply to such of its citizens as are not domiciled in
California but in other jurisdictions. The rule laid down of resorting to the law of the domicile in the
determination of matters with foreign element involved is in accord with the general principle of American
law that the domiciliary law should govern in most matters or rights which follow the person of the owner.
When a man dies leaving personal property in one or more states, and leaves a will directing the
manner of distribution of the property, the law of the state where he was domiciled at the time of his
death will be looked to in deciding legal questions about the will, almost as completely as the law of
situs is consulted in questions about the devise of land. It is logical that, since the domiciliary rules
control devolution of the personal estate in case of intestate succession, the same rules should
determine the validity of an attempted testamentary dispostion of the property. Here, also, it is not that
the domiciliary has effect beyond the borders of the domiciliary state. The rules of the domicile are
recognized as controlling by the Conflict of Laws rules at the situs property, and the reason for the
recognition as in the case of intestate succession, is the general convenience of the doctrine. The New
York court has said on the point: 'The general principle that a dispostiton of a personal property, valid
at the domicile of the owner, is valid anywhere, is one of the universal application. It had its origin in

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that international comity which was one of the first fruits of civilization, and it this age, when
business intercourse and the process of accumulating property take but little notice of boundary lines,
the practical wisdom and justice of the rule is more apparent than ever. (Goodrich, Conflict of Laws,
Sec. 164, pp. 442-443.)
Appellees argue that what Article 16 of the Civil Code of the Philippines pointed out as the national law is
the internal law of California. But as above explained the laws of California have prescribed two sets of laws
for its citizens, one for residents therein and another for those domiciled in other jurisdictions. Reason
demands that We should enforce the California internal law prescribed for its citizens residing therein, and
enforce the conflict of laws rules for the citizens domiciled abroad. If we must enforce the law of California
as in comity we are bound to go, as so declared in Article 16 of our Civil Code, then we must enforce the law
of California in accordance with the express mandate thereof and as above explained, i.e., apply the internal
law for residents therein, and its conflict-of-laws rule for those domiciled abroad.
It is argued on appellees' behalf that the clause "if there is no law to the contrary in the place where the
property is situated" in Sec. 946 of the California Civil Code refers to Article 16 of the Civil Code of the
Philippines and that the law to the contrary in the Philippines is the provision in said Article 16 that
the national law of the deceased should govern. This contention can not be sustained. As explained in the
various authorities cited above the national law mentioned in Article 16 of our Civil Code is the law on
conflict of laws in the California Civil Code, i.e., Article 946, which authorizes the reference or return of the
question to the law of the testator's domicile. The conflict of laws rule in California, Article 946, Civil Code,
precisely refers back the case, when a decedent is not domiciled in California, to the law of his domicile, the
Philippines in the case at bar. The court of the domicile can not and should not refer the case back to
California; such action would leave the issue incapable of determination because the case will then be like a
football, tossed back and forth between the two states, between the country of which the decedent was a
citizen and the country of his domicile. The Philippine court must apply its own law as directed in the conflict
of laws rule of the state of the decedent, if the question has to be decided, especially as the application of the
internal law of California provides no legitime for children while the Philippine law, Arts. 887(4) and 894,
Civil Code of the Philippines, makes natural children legally acknowledged forced heirs of the parent
recognizing them.
The Philippine cases (In re Estate of Johnson, 39 Phil. 156; Riera vs. Palmaroli, 40 Phil. 105; Miciano vs.
Brimo, 50 Phil. 867; Babcock Templeton vs. Rider Babcock, 52 Phil. 130; and Gibbs vs. Government, 59
Phil. 293.) cited by appellees to support the decision can not possibly apply in the case at bar, for two
important reasons, i.e., the subject in each case does not appear to be a citizen of a state in the United States
but with domicile in the Philippines, and it does not appear in each case that there exists in the state of which
the subject is a citizen, a law similar to or identical with Art. 946 of the California Civil Code.
We therefore find that as the domicile of the deceased Christensen, a citizen of California, is the Philippines,
the validity of the provisions of his will depriving his acknowledged natural child, the appellant, should be
governed by the Philippine Law, the domicile, pursuant to Art. 946 of the Civil Code of California, not by the
internal law of California..
WHEREFORE, the decision appealed from is hereby reversed and the case returned to the lower court with
instructions that the partition be made as the Philippine law on succession provides. Judgment reversed, with
costs against appellees.
Padilla, Bautista Angelo, Concepcion, Reyes, Barrera, Paredes, Dizon, Regala and Makalintal, JJ., concur.
Bengzon, C.J., took no part.
PCIB vs Escolin
on November 5, 2010
56 scra 266
Nationality Principle
Linnie Jane Hodges, a married woman and a citizen of Texas, USA, was a domiciliary of the Philippines at
the moment of her death. With respect to the validity of certain testamentary provisions she had made in

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favor of her husband, a question arose as to what exactly were the laws of Texas on the matter at the precise
moment of her death (for while one group contended that the Texan law should result to renvoi, the other
group contended that no renvoi was possible).
ISSUE: Whether or not Texas Law should apply.
HELD: The Supreme Court held that for what the Texas law is on the matter, is a question of fact to be
resolved by the evidence that would be presented in the probate court. Texas law at the time of her death (and
not said law at any other time). NOTE: Dynamics of law.

Llorente vs CA
on November 5, 2010
345 scra 592
Nationality Principle
Lorenzo and petitioner Paula Llorente was married before a parish priest. Before the outbreak of war,
Lorenzo departed for the United States and Paula was left at the conjugal home. Lorenzo was naturalized by
the United State. After the liberation of the Philippines he went home and visited his wife to which he
discovered that his wife was pregnant and was having an adulterous relationship. Lorenzo returned to the US
and filed for divorce. Lorenzo married Alicia LLorente; they lived together for 25 years and begot 3 children.
Lorenzo on his last will and testament bequeathed all his property to Alicia and their 3 children. Paula filed a
petition for letters administration over Lorenzos estate. The RTC ruled in favor of Paula. On appeal, the
decision was modified declaring Alicia as co-owner of whatever properties they have acquired. Hence, this
petition to the Supreme Court.
ISSUES: Whether or not the divorce obtained by Lorenzo capacitated him to remarry. Who are entitled to
inherit from the late Lorenzo Llorente?
HELD: In Van Dorn vs Ramillo Jr. the Supreme Court held that owing to the nationality principle embodied
in Article 15 of the Civil Code, only Philippine nationals are covered by the policy against absolute divorce.
In the same case, the Court ruled that aliens may obtain divorce abroad provided that they are valid according
to their national law. The Supreme Court held that divorce obtained by Lorenzo from his first wife Paula was
valid and recognized in this jurisdiction as a matter of comity.
The Supreme Court remanded the case to the court of origin for the determination of the intrinsic validity of
Lorenzos will and determine the successional rights allowing proof of foreign law. The deceased is not
covered by our laws on family rights and duties, status, condition and legal capacity since he was a
foreigner.