Case Digest 5

Conflicts of Laws

1. Saudi Arabian Airlines vs. Court of Appeals

In 1988 defendant SAUDIA hired plaintiff as a Flight Attendant for its airlines based in Jeddah, Saudi Arabia.
In 1990, while on a lay-over in Jakarta, Indonesia, plaintiff went to a disco dance with fellow crew members Thamer AlGazzawi and Allah
Al-Gazzawi, both Saudi nationals. Because it was almost morning when they returned to their hotels, they agreed to have breakfast together
at the room of Thamer. When they were in te (sic) room, Allah left on some pretext. Shortly after he did, Thamer attempted to rape
plaintiff. Fortunately, a roomboy and several security personnel heard her cries for help and rescued her. Later, the Indonesian police came
and arrested Thamer and Allah Al-Gazzawi, the latter as an accomplice.
Plaintiff learned that, through the intercession of the Saudi Arabian government, the Indonesian authorities agreed to deport Thamer and
Allah after two weeks of detention. Eventually, they were again put in service by defendant SAUDIA (sic). In September 1990, defendant
SAUDIA transferred plaintiff to Manila.
In 1992, just when plaintiff thought that the Jakarta incident was already behind her, her superiors requested her to see Mr. Ali Meniewy,
Chief Legal Officer of SAUDIA, in Jeddah, Saudi Arabia. When she saw him, he brought her to the police station where the police took her
passport and questioned her about the Jakarta incident. Miniewy simply stood by as the police put pressure on her to make a statement
dropping the case against Thamer and Allah. Not until she agreed to do so did the police return her passport and allowed her to catch the
afternoon flight out of Jeddah.
June 16, 1993: Morada, while in Riyadh Saudi Arabia, was not allowed to board the plane to Manila and instead ordered to take a later
flight to Jeddah to see Mr. Miniewy. Khalid of the SAUDIA office brought her to a Saudi court where she was asked to sign a document
written in Arabic. They told her that this was necessary to close the case against Thamer and Allah but it was actually a notice for her to
appear before the court on June 27, 1993. Plaintiff then returned to Manila.
June 27, 1993: SAUDIA's Manila manager, Aslam Saleemi, assured Morada that the investigation was routinary and that it posed no
danger to her so she reported to Miniewy in Jeddah for further investigation. She was brought to the Saudi court.
June 28, 1993: Saudi judge interrogated Morada through an interpreter about the Jakarta incident for an hour and let her go. SAUDIA
officers forbidden her to take flight. She was told to go the Inflight Service Office where her passport was taken and they told her to
remain in Jeddah, at the crew quarters, until further orders.
July 3, 1993: She was brought to court again and to her astonishment and shock, rendered a decision, translated to her in English,
sentencing her to five months imprisonment and to 286 lashes. The court tried her, together with Thamer and Allah, and found her guilty
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.
Failing to seek the assistance of her employer, SAUDIA, she asked the Philippine Embassy in Jeddah to help her while her case is on
appeal. She continued to work on the domestic flight of SAUDIA, while Thamer and Allah continued to serve in the international flights.
Because she was wrongfully convicted, the Prince of Makkah dismissed the case against her and allowed her to leave Saudi Arabia. Before
her return to Manila, she was terminated from the service by SAUDIA, without her being informed of the cause.
November 23, 1993: Morada filed a Complaint for damages against SAUDIA, and Khaled Al-Balawi, its country manager.
January 19, 1994: SAUDIA filed an Omnibus Motion To Dismiss on following grounds: (1) that the Complaint states no cause of action
against SAUDIA (2) that defendant Al-Balawi is not a real party in interest (3) that the claim or demand set forth in the Complaint has been
waived, abandoned or otherwise extinguished and (4) that the trial court has no jurisdiction to try the case.
ISSUE: WON The trial court has no jurisdiction to hear and try the civil case based on Article 21 of the New Civil Code since the proper
law applicable is the law of the Kingdom of Saudi Arabia inasmuch as this case involves what is known in private international law as a
conflicts problem. Otherwise, the Republic of the Philippines will sit in judgment of the acts done by another sovereign state which is
abhorred.
HELD: No. The trial court has jurisdiction to try the case. Article 19 and 21 of the NCC are applicable in this case.

The case is a conflicts case

Where the factual antecedents satisfactorily establish the existence of a foreign element, we agree with petitioner that the problem herein
could present a conflicts 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 forms in which this foreign element may appear are 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 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 from Manila, Philippines to
Jeddah, Saudi Arabia, and vice versa, that caused a conflicts situation to arise.
Quezon City RTC has Jurisdiction
Based on the allegations46 in the Amended Complaint, read in the light of the Rules of Court on jurisdiction we find that the Regional Trial
Court (RTC) of Quezon City possesses jurisdiction over the subject matter of the suit.
Pragmatic considerations, including the convenience of the parties, also weigh heavily in favor of the RTC Quezon City assuming
jurisdiction. Paramount is the private interest of the litigant.
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.
Philippine Law is applicable
Several theories have been propounded in order to identify the legal system that should ultimately control.
Before a choice can be made, it is necessary for us to determine under what category a certain set of facts or rules fall. This process is
known as characterization, or the doctrine of qualification. It is the process of deciding whether or not the facts relate to the kind of
question specified in a conflicts rule. The purpose of characterization is to enable the forum to select the proper law.
Our starting point of analysis here is not a legal relation, but a factual situation, event, or operative fact. 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.(Italics ours.)
After a careful study of the pleadings on record, we are convinced that there is reasonable basis for private respondents assertion that
although she was already working in Manila, petitioner brought her to Jeddah on the pretense that she would merely testify in an
investigation of the charges she made against the two SAUDIA crew members for the attack on her person while they were in Jakarta. As it
turned out, she was the one made to face trial for very serious charges, including adultery and violation of Islamic laws and tradition.
There is likewise logical basis on record for the claim that the handing over or turning over of the person of private respondent to Jeddah
officials, petitioner may have acted beyond its duties as employer. Petitioners purported act contributed to and amplified or even
proximately caused additional humiliation, misery and suffering of private respondent. Petitioner thereby allegedly facilitated the arrest,
detention and prosecution of private respondent under the guise of petitioners authority as employer, taking advantage of the trust,
confidence and faith she reposed upon it.
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.

2. Bellis vs. Bellis

Amos G. Bellis, born in Texas, was "a citizen of the State of Texas and of the United States." By his first wife, Mary E. Mallen, whom he
divorced, he had five legitimate children. by his second wife, Violet Kennedy, who survived him, he had three legitimate children. He also
had 3 illegitimate children.
On August 5, 1952, Amos G. Bellis executed a will in the Philippines, in which he directed that after all taxes, obligations, and expenses of
administration are paid f or, his distributable estate should be divided, in trust, in the following order and manner: (a) $240,000.00 to his
first wife, Mary E. Mallen; (b) P120,000.00 to his three illegitimate children, Amos Bellis, Jr., Maria Cristina Bellis and Miriam Palma
Bellis, or P40,000.00 each and (c) after the foregoing two items have been satisfied, the remainder shall go to his seven surviving children
by his first and second wives.
Subsequently, or on July 8, 1958, Amos G. Bellis died, a resident of San Antonio, Texas, U.S.A. His will was admitted to probate in the
Court of First Instance of Manila on September 15, 1958.
His illegitimate children opposed the proceedings stating that their legitimes were violated by the will.
ISSUE: Which law on succession should apply, Philippine Law or Texas Law.
HELD: The Law of Texas. The decedent was a citizen of Texas and he was also a resident thereof when he died. The Renvoi Doctrine is
not applicable in this case.
Moreover a provision in a foreigner's will to the effect that his properties shall be distributed in accordance with Philippine law and not
with his national law, is illegal and void. for his national law cannot be ignored in regard to those matters that Article 10·now Article 16·of
the Civil Code states said national law should govern.
Article 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 wherein said property may be found.

3. Insular Government vs. Frank

That on or about the 17th day of April, 1903, in the city of Chicago, in the State of Illinois, in the United States, the defendant, through a
representative of the Insular Government of the Philippine Islands, entered into a contract for a period of two years with the plaintiff, by
which the defendant was to receive a salary of 1,200 dollars per year as a stenographer in the service of the said plaintiff, and in addition
thereto was to be paid in advance the expenses incurred in traveling from the said city of Chicago to Manila, and one-half salary during
said period of travel.
Said contract contained a provision that in case of a violation of its terms on the part of the defendant, he should become liable to the
plaintiff for the amount expended by the Government by way of expenses incurred in traveling from Chicago to Manila and the one-half
salary paid during such period.
That on the 11th day of February, 1904, the defendant left the service of the plaintiff and refused to make a further compliance with the
terms of the contract.
On December, 1904, the plaintiff commenced an action in the Court of First Instance of the city of Manila to recover from the defendant
the sum of 269.23 dollars, which amount the plaintiff claimed had been paid to the defendant as expenses incurred in traveling from
Chicago to Manila, and as half salary for the period consumed in travel.
The defendant alleged in his special defense that he was a minor and therefore the contract could not be enforced against him. The record
discloses that, at the time the contract was entered into in the State of Illinois, he was an adult under the laws of that State and had full
authority to contract. The plaintiff [the defendant] claims that, by reason of the fact that, under the laws of the Philippine Islands at the time
the contract was made, male persons in said Islands did not reach their majority until they had attained the age of 23 years, he was not
liable under said contract, contending that the laws of the Philippine Islands governed.
ISSUE: WON the defendant had the capacity to contract.
HELD: Yes. It is not disputed·upon the contrary the fact is admitted·that at the time and place of the making of the contract in question the
defendant had full capacity to make the same. No rule is better settled in law than that matters bearing upon the execution, interpretation
and validity of a contract are determined by the law of the place where the contract is made. Matters connected with its performance are
regulated by the law prevailing at the place of performance. Matters respecting a remedy, such as the bringing of suit, admissibility of
evidence, and statutes of limitations, depend upon the law of the place where the suit is brought.
The defendant's claim that he was an adult when he left Chicago but was a minor when he arrived at Manila; that he was an adult at the
time he made the contract but was a minor at the time the plaintiff attempted to enforce the contract, more than a year later, is not tenable.
The plaintiff [defendant] being fully qualified to enter into the contract at the place and time the contract was made, he cannot plead
infancy as a defense at the place where the contract is being enforced.

4. Cadalin vs. POEA's Administrator

This is a consolidation of 3 cases of SPECIAL CIVIL ACTIONS in the Supreme Court for Certiorari.
On June 6, 1984, Cadalin, Amul and Evangelista, in their own behalf and on behalf of 728 other OCWs instituted a class suit by filing an
“Amended Complaint” with the POEA for money claims arising from their recruitment by ASIA INTERNATIONAL BUILDERS
CORPORATION (AIBC) and employment by BROWN & ROOT INTERNATIONAL, INC (BRI) which is a foreign corporation with
headquarters in Houston, Texas, and is engaged in construction; while AIBC is a domestic corporation licensed as a service contractor to
recruit, mobilize and deploy Filipino workers for overseas employment on behalf of its foreign principals.
The amended complaint sought the payment of the unexpired portion of the employment contracts, which was terminated prematurely, and
secondarily, the payment of the interest of the earnings of the Travel and Reserved Fund; interest on all the unpaid benefits; area wage and
salary differential pay; fringe benefits; reimbursement of SSS and premium not remitted to the SSS; refund of withholding tax not remitted
to the BIR; penalties for committing prohibited practices; as well as the suspension of the license of AIBC and the accreditation of BRII
(at madami pang motions ang na-file, new complainants joined the case, ang daming inavail na remedies ng both parties)
The case rooted from the Labor Law enacted by Bahrain where most of the complainants were deployed. His Majesty Ise Bin Selman Al
Kaifa, Amir of Bahrain, issued his Amiri Decree No. 23 on June 16, 1176, otherwise known re the Labour Law for the Private Sector.The
new law provided provisions favourable to the laborers. It provided them with benefits greater than the benefits in the employment contract
that they have signed.
ISSUE: WON the foreign law should govern or the contract of the parties.(WON the complainants who have worked in Bahrain are
entitled to the above-mentioned benefits provided by Amiri Decree No. 23 of Bahrain).
HELD: NLRC applied the Amiri Deere, No. 23 of 1976, which provides for greater benefits than those stipulated in the overseas-
employment contracts of the claimants. It was of the belief that where the laws of the host country are more favorable and beneficial to the
workers, then the laws of the host country shall form part of the overseas employment contract. It approved the observation of the POEA
Administrator that in labor proceedings, all doubts in the implementation of the provisions of the Labor Code and its implementing
regulations shall be resolved in favor of labor.
The overseas-employment contracts, which were prepared by AIBC and BRII themselves, provided that the laws of the host country
became applicable to said contracts if they offer terms and conditions more favorable than those stipulated therein. However there was a
part of the employment contract which provides that the compensation of the employee may be “adjusted downward so that the total
computation plus the non-waivable benefits shall be equivalent to the compensation” therein agree,’ another part of the same provision
categorically states “that total remuneration and benefits do not fall below that of the host country regulation and custom.

5. Hongkong Shanghai Banking Corporation vs. Sherman

A complaint for collection of a sum of money (pp. 49-52, Rollo) was filed by petitioner Hongkong and Shanghai Banking Corporation
(hereinafter referred to as petitioner BANK) against private respondents Jack Robert Sherman and Deodato Reloj.
It appears that sometime in 1981, Eastern Book Supply Service PTE, Ltd. (hereinafter referred to as COMPANY), a company incorporated
in Singapore applied with, and was granted by, the Singapore branch of petitioner BANK an overdraft facility. both private respondents and
a certain Robin de Clive Lowe, all of whom were directors of the COMPANY at such time, executed a Joint and Several Guarantee in
favor of petitioner BANK whereby private respondents and Lowe agreed to pay, jointly and severally, on demand all sums owed by the
COMPANY to petitioner BANK under the aforestated overdraft facility.
The Joint and Several Guarantee provides, inter alia, 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 x x x.”
The COMPANY failed to pay its obligation. Thus,
petitioner BANK demanded payment of the obligation from private respondents, conformably with the provisions of the Joint and Several
Guarantee. Inasmuch as the private respondents still failed to pay, petitioner BANK filed the above-mentioned complaint.
ISSUE: WON the Philippine Courts have jurisdiction over the dispute.
HELD: Yes. The respondents were citizens of the Philippines.
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, We hereby agree that the Courts in Singapore shall have jurisdiction over all disputes arising under this guarantee‰ be liberally
construed.
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.
One basic principle underlies all rules of jurisdiction 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.
However, in this case, private respondents are Philippine residents. 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.
Note: Because jurisdiction cannot be stipulated upon, the choice of jurisdiction was treated as a choice of venue. And applying thus, the
choice of venue is only permissive, in the absence of restrictive words to lend exclusivity to the chosen forum.