1. WILLIAM F. GEMPERLE v. HELEN SCHENKER, GR No.

L-18164,
1967-01-23
Facts:
Appeal, taken by plaintiff, William F. Gemperle, from a decision of the Court of
First Instance of Rizal dismissing this case for lack of jurisdiction over the person
of defendant Paul Schenker and for want of cause of action against his wife and...
co-defendant, Helen Schenker, said Paul Schenker "being in no position to be
joined with her as party defendant, because he is beyond the reach of the
magistracy of the Philippine courts."
Paul Schenker hereinafter referred to as Schenker acting through his wife and
attorney-in-fact, Helen Schenker hereinafter referred to as Mrs. Schenker filed with
the Court of First Instance of Rizal, a complaint... against herein plaintiff William
F. Gemperle, for the enforcement of Schenker's allegedly initial subscription to the
shares of stock of the Philippine-Swiss Trading Co., Inc.
Mrs. Schenker had caused to be published some allegations thereof and other
matters, which were impertinent,... irrelevant and immaterial to said case... being
false and derogatory to the reputation, good name and credit of Gemperle
Gemperle commenced the present action against the Schenkers... the lower court
rendered the decision above referred to.  A reconsideration thereof having been
denied, Gemperle interposed the present appeal.
Issues:
whether or not the lower court had acquired jurisdiction over the person of
Schenker.
Ruling:
he, a Swiss citizen, residing in Zurich, Switzerland, has not been actually served
with summons in the Philippines, although... the summons addressed to him and
Mrs. Schenker had been served personally upon her in the Philippines.  It is urged
by plaintiff that jurisdiction over the person of Schenker has been secured through
voluntary appearance on his part, he not having made a special appearance... to
assail the jurisdiction over his person, and an answer having been filed in this
case... we hold that the lower court had acquired jurisdiction over said defendant,
through service of the summons addressed to him upon Mrs. Schenker, it...
appearing from said answer that she is the representative and attorney-in-fact of
her husband in the aforementioned civil case
In other words, Mrs. Schenker had authority... to sue, and had actually sued, on
behalf of her husband, so that she was, also, empowered to represent him in suits
filed against him, particularly in a case, like the one at bar, which is a consequence
of the action brought by her on his behalf.
decision appealed from should be, as it is hereby, reversed, and the case remanded
to the lower court
 2. 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, Nippon’s 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 Kitamaru’s 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.

Nippon’s 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 Kitamaru’s 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 notautomatically 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 issue—jurisdiction. 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 lawgrants 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 2 nd 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, Nippon’s 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, 1 st there should
exist a conflict of laws situation requiring theapplication 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 court’s 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 formalagreements, 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.
 3. LWV CONSTRUCTION CORPORATION v. MARCELO B. DUPO, GR
No. 172342, 2009-07-13
Facts:
Petitioner, a domestic corporation which recruits Filipino workers, hired
respondent as Civil Structural Superintendent to work in Saudi Arabia for its
principal, Mohammad Al-Mojil Group/Establishment... respondent signed his first
overseas employment... contract, renewable after one year.
All were fixed-period contracts for one year. The sixth and last contract stated that
respondent's... employment starts upon reporting to work and ends when he leaves
the work site.
respondent informed MMG, through the petitioner, that he needs to extend his
vacation because his son was hospitalized. He also sought a promotion with salary
adjustment
MMG informed respondent that his promotion is subject to... management's
review; that his services are still needed; that he was issued a plane ticket for his
return flight to Saudi Arabia on May 31, 1999;
On July 6, 1999, respondent resigned... respondent, when he followed up his claim
for long service award on December 7, 2000, petitioner informed him that MMG
did not respond... respondent filed a complaint[7] for payment of service award
against petitioner before the National Labor Relations Commission (NLRC),...
Under the Law of Saudi Arabia, an employee who rendered at least five (5) years
in a company within the jurisdiction of Saudi Arabia, is entitled to the so-called
long service award
In excess of five years an employee is entitled to one month pay for every year of
service. In both cases inclusive of all benefits and allowances.
petitioner offered payment and prescription as defenses. Petitioner maintained that
MMG "pays its workers their Service Award or Severance Pay every conclusion of
their Labor Contracts pursuant to Article 87 of the [Saudi Labor Law]." Under
Article 87,... "payment of the award is at the end or termination of the Labor
Contract concluded for a specific period." Based on the payroll,[9] respondent was
already paid his service award or severance pay for his latest (sixth) employment
contract... he Saudi Labor Law, the action to enforce payment of the service award
must be filed within one year from the termination of a labor contract for a specific
period.
Petitioner concluded that the one-year prescriptive period had lapsed because
respondent filed his complaint on December 11, 2000 or... one year and seven
months after his sixth contract ended.
Labor Arbiter ordered petitioner to pay respondent longevity pay
NLRC dismissed the appeal and affirmed the Labor Arbiter's decision... he Court
of Appeals denied the petition and affirmed the NLRC
Issues:
the issue is whether the Court of Appeals erred in ruling that respondent is entitled
to a service award or longevity pay of US$12,640.33 under the provisions of the
Saudi Labor Law
Ruling:
we are constrained to reverse the Court of Appeals.
We find that respondent's service award under Article 87 of the Saudi Labor Law
has already been paid. Our computation will show that the severance pay received
by respondent was... his service award.
Respondent, however, has called the benefit other names such as long service
award and longevity pay. On the other hand, petitioner claimed that the service
award is the same as severance pay.
petition is GRANTED.
Principles:
he characterization of a statute into a procedural or substantive law becomes
irrelevant when the country of the forum has a "borrowing statute." Said statute has
the practical effect of treating the foreign statute of limitation as one of substance
A "borrowing statute" directs the state of the forum to apply the foreign statute of
limitations to the pending claims based on a foreign law
 4. RAYTHEON INTERNATIONAL v. STOCKTON W. ROUZIE, GR No.
162894, 2008-02-26
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.
 5. PHILIPPINE COMMERCIAL AND INDUSTRIAL BANK, petitioner
vs. VENICIO ESCOLIN, ET AL., respondent
56 S 266

FACTS:

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 a will in 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 Texan
Law should result to renvoi, the other group contended that no renvoi was
possible).

ISSUE:

Whether or not the Texas law should apply.

HELD:

The Supreme Court held that what the Texas law contains at the time of
Jane Hodges’ death is a question of fact to be resolved by the evidence that would
be presented in the probate court. At the time of her death, Texas law governs,
thus, it would be the law to be applied (and not said law at any other time).
 6. PIONEER CONCRETE PHILIPPINES v. TODARO
254 SCRA 153 June 8, 2007

FACTS
Antonio D. Todaro (Todaro) filed with the RTC of Makati City, a complaint for
Sum of Money and Damages with Preliminary Attachment against Pioneer
International Limited (PIL), Pioneer Concrete Philippines, Inc. (PCPI), Pioneer
Philippines Holdings, Inc. (PPHI), John G. McDonald (McDonald) and Philip J.
Klepzig (Klepzig).

Todaro alleged that PIL is a corporation duly organized and existing under the laws
of Australia and is principally engaged in the ready-mix concrete and concrete
aggregates business; PPHI is the company established by PIL to own and hold the
stocks of its operating company in the Philippines; PCPI is the company
established by PIL to undertake its business of ready-mix concrete, concrete
aggregates and quarrying operations in the Philippines; McDonald is the Chief
Executive of the Hongkong office of PIL; and, Klepzig is the President and
Managing Director of PPHI and PCPI; Todaro has been the managing director of
Betonval Readyconcrete, Inc. (Betonval), a company engaged in pre-mixed
concrete and concrete aggregate production; he resigned from Betonval in
February 1996; in May 1996, PIL contacted Todaro and asked him if he was
available to join them in connection with their intention to establish a ready-mix
concrete plant and other related operations in the Philippines; Todaro informed PIL
of his availability and interest to join them; subsequently, PIL and Todaro came to
an agreement wherein the former consented to engage the services of the latter as a
consultant for two to three months, after which, he would be employed as the
manager of PIL's ready-mix concrete operations should the company decide to
invest in the Philippines; subsequently, PIL started its operations in the
Philippines; however, it refused to comply with its undertaking to employ Todaro
on a permanent basis. Instead of filing an Answer, PPHI, PCPI and Klepzig
separately moved to dismiss the complaint on the grounds that the complaint states
no cause of action, that the RTC has no jurisdiction over the subject matter of the
complaint, as the same is within the jurisdiction of the NLRC, and that the
complaint should be dismissed on the basis of the doctrine of forum non
conveniens. RTC dismissed the MTD which was affirmed by the CA.

ISSUE
W/N the RTC should have dismissed the case on the basis of forum non
conveniens due to a presence of a foreign element

RULING
NO. Whether a suit should be entertained or dismissed on the basis of said doctrine
depends largely upon the facts of the particular case and is addressed to the sound
discretion of the trial court. In the case of Communication Materials and Design,
Inc. vs. Court of Appeals, this Court held that "xxx [a] Philippine Court may
assume jurisdiction over the case if it chooses to do so; provided, that the following
requisites are met: (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."
The doctrine of forum non conveniens should not be used as a ground for a motion
to dismiss because Sec. 1, Rule 16 of the Rules of Court does not include said
doctrine as a ground. This Court further ruled that 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; and that the propriety of dismissing a case based on
this principle of forum non conveniens requires a factual determination, hence it is
more properly considered a matter of defense.

Note: the case was also being dismissed on the ground that there was no cause of
action but SC held that there was cause of action, to sustain a motion to dismiss for
lack of cause of action, the complaint must show that the claim for relief does not
exist, rather than that a claim has been defectively stated, or is ambiguous,
indefinite or uncertain. And it was also argued in this case that jurisdiction is with
the NLRC and not with the RTC. SC held it was with RTC, SC has consistently
held that where no employer-employee relationship exists between the parties and
no issue is involved which may be resolved by reference to the Labor Code, other
labor statutes or any collective bargaining agreement, it is the RTC that has
jurisdiction.
 7. MOY YA LIM YAO VS COMMISSIONER OF IMMIGRATION
GR # L-21289, October 4, 1971 [Naturalization - Qualification and
Disqualification; CA 473]

FACTS:
Lau Yuen Yeung, an alien visiting the Philippines, whose authorized stay in the
Philippines was to expire, claims herself to be lawfully naturalized upon her
marriage to a Filipino citizen. Solicitor General opposes the ground that the
marriage of the alien to a Filipino citizen does not automatically confer on the
latter Philippine citizenship. Plaintiff-appellant does not possess all the
qualifications required for applicant for naturalization (CA 473), even she has
proven that she possesses none of the disqualifications in said law.

ISSUE:
Whether or not Lau Yuen Yeung became ipso facto a Filipino citizen upon her
marriage to a Filipino citizen.

RULING:
Yes. An alien woman, upon her marriage to a Filipino citizen, becomes lawfully
naturalized ipso facto, provided that she does not possess all of the
disqualifications enumerated in CA 473. (Sections 15 and 4)
 8. Gov’t of the Phil. Island vs George I. Frank

G.R. No. L-2935, 23 March 1909

Johnson, J.

Facts:

Through a contract executed in the US, Frank agreed to work for Plaintiff in the
Philippines. The plaintiff paid Frank an advance payment upon arriving in the
Philippines as stipulated in their contract.

While in the Philippines Frank left the service of the Government. Since Frank
abandoned the contract, the Government filed a case against him to collect the
remaining money that was paid in advanced.

Frank in his defense contends that he was an adult in the US but he is a minor in
the Philippines.  So the contract cannot be enforced against him.

The lower court decided in favor of the plaintiff and ordered the defendant to pay
the amount in question.

Issue:

Whether or not the court was correct in rendering judgment in favor of the
plaintiff.

Ruling:

Yes. The contention of the defendant that he is an adult in the US but  he is still a
minor in the Philippines where the contract was implemented is not disputed.  In
fact the court considered the defendant’s contention as a reason to apply the
principle: that when matters bearing upon the execution, interpretation and validity
of the contract are determined by the law of the place where the contract is made
or “lex loci celebrationis” .
Since the contract was made in the US and US law considers the defendant of legal
age, he has the legal capacity to enter into a contract and therefore making the
contract enforceable against him.
9. Wells Fargo Bank & Union Trust Company v CIR GR No L-46720, June
28, 1940

FACTS:
Birdie Lillian Eye died on September 16, 1932 at Los Angeles, California,
the place of her alleged last residence and domicile. Among the properties
she left was her 1⁄2 conjugal shares of stock in the Benguet Consolidated
Mining Co., an anonymous partnership, organized under the laws of the
Philippines. She left a will duly admitted to probate in California where her
estate was administered and settled. Wells Fargo was the duly appointed
trustee. The Federal and California State’s inheritance taxes due thereon
have been duly paid. The Collector of Internal Revenue in the Philippines,
however, sought to subject the shares of stock to inheritance tax, to which
Wells Fargo objected.

ISSUE:
Whether the shares of stock are subject to Philippine inheritance tax

RULING:
Yes. Originally, the settled law in the United States is that intangibles have
only one situs for the purpose of inheritance tax, and such situs is in the
domicile of the decedent at the time of his or her death. But the rule has been
relaxed.
The maxim “mobilia sequuntur personam” up which the rule rests, has been
decried as a mere fiction of law having its origin in considerations of general
convenience and public policy and cannot be applied to limit or control the
right of the state to tax properly within its jurisdiction and must yield to
established fact of legal ownership, actual presence and control elsewhere,
and cannot be applied if to do so would result in inescapable and patent
injustice.
This rests on either of two fundamental considerations:

(1)  Upon the recognition of the inherent power of each government to tax
persons, properties and rights within its jurisdiction
and enjoying, thus, the protect of its laws; and

(2)  Upon the principle that as to intangibles, a single location in space is

hardly possible, considering the multiple, distinct
relationships which may be entered into with respect thereto.

Herein, the actual situs of the shares of stock is in the Philippines, the
corporation being domiciled therein. Accordingly the jurisdiction of the
Philippine government to tax must be upheld.