1.

Saudi Arabian Airlines v CA

Milagros Morada was working as a stewardess for Saudia Arabian Airlines. In 1990, while
she and some co-workers were in a lay-over in Jakarta, Indonesia, an Arab co-worker tried
to rape her in a hotel room. Fortunately, a roomboy heard her cry for help and two of her
Arab co-workers were arrested and detained in Indonesia. Later, Saudia Airlines re-
assigned her to work in their Manila office. While working in Manila, Saudia Airlines advised
her to meet with a Saudia Airlines officer in Saudi. She did but to her surprise, she was
brought to a Saudi court where she was interrogated and eventually sentenced to 5 months
imprisonment and 289 lashes; she allegedly violated Muslim customs by partying with
males. The Prince of Makkah got wind of her conviction and the Prince determined that she
was wrongfully convicted hence the Prince absolved her and sent her back to the
Philippines. Saudia Airlines later on dismissed Morada. Morada then sued Saudia Airlines
for damages under Article 19 and 21 of the Civil Code. Saudia Airlines filed a motion to
dismiss on the ground that the RTC has no jurisdiction over the case because the
applicable law should be the law of Saudi Arabia. Saudia Airlines also prayed for other
reliefs under the premises.
ISSUE: Whether or not Saudia Airlines’ contention is correct.
HELD: No. Firstly, the RTC has acquired jurisdiction over Saudia Airlines when the latter
filed a motion to dismiss with petition for other reliefs. The asking for other reliefs effectively
asked the court to make a determination of Saudia Airlines’s rights hence a submission to
the court’s jurisdiction.
Secondly, the RTC has acquired jurisdiction over the case because as alleged in the
complaint of Morada, she is bringing the suit for damages under the provisions of our Civil
Law and not of the Arabian Law. Morada then has the right to file it in the QC RTC because
under the Rules of Court, a plaintiff may elect whether to file an action in personam (case at
bar) in the place where she resides or where the defendant resides. Obviously, it is well
within her right to file the case here because if she’ll file it in Saudi Arabia, it will be very
disadvantageous for her (and of course, again, Philippine Civil Law is the law invoked).
Thirdly, one important test factor to determine where to file a case, if there is a foreign
element involved, is the so called “locus actus” or where an act has been done. In the case
at bar, Morada was already working in Manila when she was summoned by her superior to
go to Saudi Arabia to meet with a Saudia Airlines officer. She was not informed that she
was going to appear in a court trial. Clearly, she was defrauded into appearing before a
court trial which led to her wrongful conviction. The act of defrauding, which is tortuous, was
committed in Manila and this led to her humiliation, misery, and suffering. And applying the
torts principle in a conflicts case, the SC finds that the Philippines could be said as a situs of
the tort (the place where the alleged tortious conduct took place).

2. Hasegawa v Kitamura
In March 1999, Nippon Engineering Consultants Co., Ltd, a Japanese firm, was contracted
by the Department of Public Works and Highways (DPWH) to supervise the construction of
the Southern Tagalog Access Road. In April 1999, Nippon entered into an independent
contractor agreement (ICA) with Minoru Kitamura for the latter to head the said project. The
ICA was entered into in Japan and is effective for a period of 1 year (so until April 2000). In
January 2000, DPWH awarded the Bongabon-Baler Road project to Nippon. Nippon
subsequently assigned Kitamura to head the road project. But in February 2000, Kazuhiro
Hasegawa, the general manager of Nippon informed Kitamura that they are pre-terminating
his contract. Kitamura sought Nippon to reconsider but Nippon refused to negotiate.
Kitamura then filed a complaint for specific performance and damages against Nippon in the
RTC of Lipa.
Hasegawa filed a motion to dismiss on the ground that the contract was entered in Japan
hence, applying the principle of lex loci celebracionis, cases arising from the contract should
be cognizable only by Japanese courts. The trial court denied the motion. Eventually,
Nippon filed a petition for certiorari with the Supreme Court.
 Hasegawa, on appeal significantly changed its theory, this time invoking forum non
conveniens; that the RTC is an inconvenient forum because the parties are Japanese
nationals who entered into a contract in Japan. Kitamura on the other hand invokes the trial
court’s ruling which states that matters connected with the performance of contracts are
regulated by the law prevailing at the place of performance, so since the obligations in the
ICA are executed in the Philippines, courts here have jurisdiction.
ISSUE: Whether or not the complaint against Nippon should be dismissed.
HELD: No. The trial court did the proper thing in taking cognizance of it.
In the first place, the case filed by Kitamura is a complaint for specific performance and
damages. Such case is incapable of pecuniary estimation; such cases are within the
jurisdiction of the regional trial court.
Hasegawa filed his motion to dismiss on the ground of forum non conveniens. However,
such ground is not one of those provided for by the Rules as a ground for dismissing a civil
case.
The Supreme Court also emphasized that the contention that Japanese laws should apply
is premature. In conflicts cases, there are three phases and each next phase commences
when one is settled, to wit:

1. Jurisdiction – Where should litigation be initiated? Court must have jurisdiction over

the subject matter, the parties, the issues, the property, the res. Also 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 which will determine the merits of the case is
fair to both parties.
2. Choice of Law – Which law will the court apply? Once a local court takes
cognizance, it does not mean that the local laws must automatically apply. The court must
determine which substantive law when applied to the merits will be fair to both parties.
3. Recognition and Enforcement of Judgment – Where can the resulting judgment
be enforced?

This case is not yet in the second phase because upon the RTC’s taking cognizance of the
case, Hasegawa immediately filed a motion to dismiss, which was denied. He filed a motion
for reconsideration, which was also denied. Then he bypassed the proper procedure by
immediately filing a petition for certiorari. The question of which law should be applied
should have been settled in the trial court had Hasegawa not improperly appealed the
interlocutory order denying his MFR.

3. Raytheon Intl. v Rouzie

Facts:

Brand Marine Services, Inc. (BMSI), a corporation duly organized and existing under the
laws of the State of Connecticut, United States of America, and respondent Stockton W.
Rouzie, Jr., an American citizen, entered into a contract whereby BMSI hired... respondent
as its representative to negotiate the sale of services in several government projects in the
Philippines for an agreed remuneration of 10% of the gross receipts.

respondent secured a service contract with the Republic of the Philippines on behalf of

BMSI for the dredging of rivers affected by the Mt. Pinatubo eruption and mudflows.

respondent filed before the Arbitration Branch of

(NLRC) a suit against BMSI and Rust International, Inc. (RUST), Rodney C. Gilbert and
Walter G. Browning for alleged nonpayment of commissions, illegal termination and...
breach of employment contract.
Labor Arbiter Pablo C. Espiritu, Jr. rendered judgment ordering BMSI and RUST to pay
respondent's money claims.

Upon appeal by BMSI, the NLRC reversed the decision of the Labor

Arbiter and dismissed respondent's complaint on the ground of lack of jurisdiction.

Respondent elevated the case to this Court but was dismissed... respondent, then a
resident of La Union, instituted an action for damages before the Regional Trial Court (RTC)
of Bauang, La Union.

defendants herein petitioner Raytheon

International, Inc. as well as BMSI and RUST, the two corporations impleaded in the earlier
labor case

BMSI verbally employed respondent to negotiate the sale of services in government

projects and that... respondent was not paid the commissions due him from the Pinatubo
dredging project which he secured on behalf of BMSI.

In its Answer,[8] petitioner alleged that contrary to respondent's claim, it was a foreign
corporation duly licensed to do business in the Philippines and denied entering into any
arrangement with respondent or paying the latter any sum of money.

Petitioner also referred to the NLRC decision which disclosed that per the written
agreement between respondent and BMSI and RUST,... denominated as "Special Sales
Representative Agreement," the rights and obligations of the parties shall be governed by
the laws of the State of Connecticut.[10] Petitioner sought the dismissal of the complaint on
grounds of failure to state a cause of... action and forum non conveniens and prayed for
damages by way of compulsory counterclaim.[

RTC denied petitioner's omnibus motion. The trial court held that the factual allegations in
the complaint, assuming the same to be admitted, were sufficient for the trial court to render
a valid judgment... thereon. It also ruled that the principle of forum non conveniens was
inapplicable because the trial court could enforce judgment on petitioner, it being a foreign
corporation licensed to do business in the Philippines.

Court of Appeals rendered the assailed Decision[21] denying the petition for certiorari for
lack of merit.

the appellate court deferred to the discretion of the trial court when... the latter decided not
to desist from assuming jurisdiction on the ground of the inapplicability of the principle of
forum non conveniens.

Issues:

WHETHER OR NOT THE COURT OF APPEALS ERRED IN REFUSING TO DISMISS THE

COMPLAINT ON THE GROUND OF FORUM NON CONVENIENS.

Petitioner mainly asserts that the written contract between respondent and BMSI included a
valid choice of law clause, that is, that the contract shall be governed by the laws of the
State of Connecticut. It also mentions the presence of foreign elements in the dispute
namely,... the parties and witnesses involved are American corporations and citizens and
the evidence to be presented is located outside the Philippines that renders our local courts
inconvenient forums.

Petitioner theorizes that the foreign elements of the dispute necessitate the... immediate
application of the doctrine of forum non conveniens.
Ruling:

The instant petition lacks merit.

Civil Case No. 1192-BG is an action for damages arising from an alleged breach of
contract. Undoubtedly, the nature of the action and the amount of damages prayed are
within the jurisdiction of the RTC.

As regards jurisdiction over the parties, the trial court acquired jurisdiction over herein
respondent (as party plaintiff) upon the filing of the complaint. On the other hand, jurisdiction
over the person of petitioner (as party defendant) was acquired by its voluntary...
appearance in court.

That the subject contract included a stipulation that the same shall be governed by the laws
of the State of Connecticut does not suggest that the Philippine courts, or any other foreign
tribunal for that matter, are precluded from hearing the civil action.

Petitioner's averments of the foreign elements in the instant case are not sufficient to oust
the trial court of its jurisdiction

WHEREFORE, the instant petition for review on certiorari is DENIED. The Decision and
Resolution of the Court of Appeals in CA-G.R. SP No. 67001 are hereby AFFIRMED. Costs
against petitioner.

Principles:

Hasegawa v. Kitamura,[26] the Court outlined three consecutive phases involved in judicial
resolution of conflicts-of-laws problems, namely: jurisdiction, choice of law, and recognition
and enforcement of judgments.

foreign element

(1) that the Philippine Court is one to which the parties may conveniently resort

(2) that the Philippine Court is in a position to make an intelligent decision as to the law and
the facts

(3) that the Philippine Court has or is likely to have the power to enforce its decision

On the matter of jurisdiction over a conflicts-of-laws problem where the case is filed in a
Philippine court and where the court has jurisdiction over the subject matter, the parties and
the res, it may or can proceed to try the case even if the rules of conflict-of-laws... or the
convenience of the parties point to a foreign forum. This is an exercise of sovereign
prerogative of the country where the case is filed.

Jurisdiction over the nature and subject matter of an action is conferred by the Constitution
and the law[30] and by the material allegations in the complaint, irrespective of whether or
not the plaintiff is entitled to recover all or some of the claims or... reliefs sought therein

Jurisdiction and... choice of law are two 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 which will determine the merits of the case is
fair to both... parties.

The choice of law stipulation will become relevant only when the substantive issues of the
instant case develop, that is, after hearing on the merits proceeds before the trial court.
Under the doctrine of forum non conveniens, a court, in conflicts-of-laws cases, may refuse
impositions on its jurisdiction where it is not the most "convenient" or available forum and
the parties are not precluded from seeking remedies elsewhere.

Moreover, the propriety of dismissing a case based on the principle of forum non
conveniens requires a factual determination; hence, it is more properly considered as a
matter of defense. While it is within the discretion of the trial court to abstain from
assuming... jurisdiction on this ground, it should do so only after vital facts are established,
to determine whether special circumstances require the court's desistance.
4. Manila Hotel Corp v NLRC

In May 1988, Marcelo Santos was an overseas worker in Oman. In June 1988, he was
recruited by Palace Hotel in Beijing, China. Due to higher pay and benefits, Santos agreed
to the hotel’s job offer and so he started working there in November 1988. The employment
contract between him and Palace Hotel was however without the intervention of the
Philippine Overseas Employment Administration (POEA). In August 1989, Palace Hotel
notified Santos that he will be laid off due to business reverses. In September 1989, he was
officially terminated.

In February 1990, Santos filed a complaint for illegal dismissal against Manila Hotel
Corporation (MHC) and Manila Hotel International, Ltd. (MHIL). The Palace Hotel was
impleaded but no summons were served upon it. MHC is a government owned and
controlled corporation. It owns 50% of MHIL, a foreign corporation (Hong Kong). MHIL
manages the affair of the Palace Hotel. The labor arbiter who handled the case ruled in
favor of Santos. The National Labor Relations Commission (NLRC) affirmed the labor
arbiter.

ISSUE: Whether or not the NLRC has jurisdiction over the case.

HELD: No. The NLRC is a very inconvenient forum for the following reasons:

1. The only link that the Philippines has in this case is the fact that Santos is a Filipino;
2. However, the Palace Hotel and MHIL are foreign corporations – MHC cannot be held
liable because it merely owns 50% of MHIL, it has no direct business in the affairs of
the Palace Hotel. The veil of corporate fiction can’t be pierced because it was not
shown that MHC is directly managing the affairs of MHIL. Hence, they are separate
entities.
3. Santos’ contract with the Palace Hotel was not entered into in the Philippines;
4. Santos’ contract was entered into without the intervention of the POEA (had POEA
intervened, NLRC still does not have jurisdiction because it will be the POEA which
will hear the case);
5. MHIL and the Palace Hotel are not doing business in the Philippines; their
agents/officers are not residents of the Philippines;

Due to the foregoing, the NLRC cannot possibly determine all the relevant facts pertaining
to the case. It is not competent to determine the facts because the acts complained of
happened outside our jurisdiction. It cannot determine which law is applicable. And in case
a judgment is rendered, it cannot be enforced against the Palace Hotel (in the first place, it
was not served any summons).

The Supreme Court emphasized that under the rule of forum non conveniens, a Philippine
court or agency may assume jurisdiction over the case if it chooses to do so provided:

(1) that the Philippine court is one to which the parties may conveniently resort to;

(2) that the Philippine court is in a position to make an intelligent decision as to the law and
the facts; and
(3) that the Philippine court has or is likely to have power to enforce its decision.

None of the above conditions are apparent in the case at bar.

5. Ingenohl v Olsen and Company

6. Government v Frank
FACTS:
- That on April 17, 1903, Chicago City, Illinois, the defendant, through a respective of
the Insular Government of the Philippine Islands, entered into a contract for a period
of two years with the plaintiff, 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 one-half salary paid during such period.
- The defendant entered upon the performance of his contract upon the 30th day of
April, 1903, and was paid half-salary from that date until June 4, 1903, the date of his
arrival in the Philippine Islands.
- That on the 11th day of February, 1904, the defendant left the service of the plaintiff
and refused to make further compliance with the terms of the contract.
- On the 3d day of 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.
- It was expressly agreed between the parties to said contract that Laws No. 80 and
No. 224 should constitute a part of said contract.
To the complaint of the plaintiff the defendant filed a general denial and a special defense,
alleging in his special defense that the Government of the Philippine Islands had amended
Laws No. 80 and No. 224 and had thereby materially altered the said contract, and also that
he was a minor at the time the contract was entered into and was therefore not responsible
under the law.
ISSUE: Whether or not the amendment of the aforementioned provisions changed the
terms of the contract?
HELD:
NO. The mere fact that the legislative department of the Government of the Philippine
Islands had amended said Acts No. 80 and No. 224 by the Acts No. 643 and No. 1040 did
not have the effect of changing the terms of the contract made between the plaintiff and the
defendant. The legislative department of the Government is expressly prohibited by section
5 of the Act of Congress of 1902 from altering or changing the terms of the contract. The
right which the defendant had acquired by virtue of Acts No. 80 and No. 224 had not been
changed in any respect by the fact that said laws had been amended. These acts,
constituting the terms of the contract, still constituted a part of said contract and were
enforceable in favor of the defendant.
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. 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.
(Scudder vs. Union National Bank, 91 U. S., 406.) 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. (Idem.)
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.
Our conclusions with reference to the first above assignment of error are, therefore:
First. That the amendments to Acts No. 80 and No. 224 in no way affected the terms of the
contract in question; and
Second. The plaintiff [defendant] being fully qualified to enter into the contract at the place
and time the contract was made, he can not plead infancy as a defense at the place where
the contract is being enforced.

7. Hilton v Guyot
Facts
Hilton (Plaintiff) and Libbey (Plaintiff), New York citizens trading in Paris, were sued in
France by Guyot (Defendant), the administrator of a French firm, for sums allegedly owed to
that firm.  The Plaintiffs appeared and litigated the merits in the French proceeding.  The
French court rendered a judgment against them that was affirmed by a higher court and
became final.  Defendant then sought to enforce that judgment in federal district court in
New York.  That court held the judgment enforceable without retrial on the merits.  The
Plaintiffs then appealed to the U.S. Supreme Court.
Issue
Do laws have any effect, of their own force, beyond the limits of the sovereignty from which
its authority is derived?
Held
(Gray, J.)  No.  No law has any effect, of its own force, beyond the limits of the sovereignty
from which its authority is derived.  No sovereign is bound, unless by special compact, to
execute within his dominions a judgment rendered by the tribunals of another state, and if
execution be sought by suit upon the judgment or otherwise, the tribunal in which the suit is
brought, or from which execution is sought, is, on principle, at liberty to examine into the
merits of such judgment, and to give effect to it or not, as may be found just and equitable.  
However, the general comity, utility and convenience of nations have established a usage
among most civilized states, by which the final judgments of foreign courts of competent
jurisdiction are reciprocally carried into execution, under certain regulations and restrictions,
which differ in different countries.  Additionally, judgments rendered in France, or in any
foreign country, by the laws of which our own judgments are reviewable upon the merits,
are not entitled to full credit and conclusive effect when sued upon in this country, but are
prima facie evidence only of the justice of the plaintiffs’ claim.  Reversed.
Dissent
(Fuller, C.J.)  The doctrine of res judicata should be applicable to domestic judgments as
well as to foreign judgments, and rests on the same general ground of public policy that
there should be an end of litigation.
Discussion
The Court’s decision in Hilton v. Guyot reflects the traditional rule of reciprocity.  According
to this concept, foreign nation judgments were granted the same or comparable treatment
as American judgments were given by the judgment nation.  Since the Court in Hilton found
that French courts would not have enforced or executed a judgment rendered in this
country, it therefore held that the French judgment at issue should be nonconclusive here.