KAZUHIRO FACTS: Cause of action: complaint

HASEGAWA and for specific performance

NIPPON Nippon Engineering Consultants (Nippon), a Japanese consultancy
ENGINEERING firm providing technical and management support in the BP129 as amended
CONSULTANTS infrastructure projects national permanently residing in the Lipa city – proper venue
CO., LTD., Philippines. The agreement provides that Kitamaru was to extend bec it is where Nippon
vs professional services to Nippon for a year. Nippon assigned holds its project office
MINORU Kitamaru to work as the project manager of the Southern Tagalog
KITAMURA Access Road (STAR) project. When the STAR project was near Grounds on motion to
completion, DPWH engaged the consultancy services of Nippon, dismiss:
this time for the detailed engineering & construction supervision What they rather raise as
of the Bongabon-Baler Road Improvement (BBRI) Project. grounds to question
Kitamaru was named as the project manager in the contract. subject matter jurisdiction
are the principles of lex loci
Hasegawa, Nippon’s general manager for its International celebrationis and lex
Division, informed Kitamaru that the company had no more contractus, and the “state
intention of automatically renewing his ICA. His services would be of the most
engaged by the company only up to the substantial completion of significant relationship
the STAR Project. rule.”

Kitamaru demanded that he be assigned to the BBRI project.

Nippon insisted that Kitamaru’s contract was for a fixed term that Invoking forum non
had expired. Kitamaru then filed for specific performance & convenience is not a
damages w/ the RTC of Lipa City. Nippon filed a MTD. ground for motion to
dismiss
Nippon’s contention: The ICA had been perfected in Japan &
executed by & between Japanese nationals. Thus, the RTC of Lipa The court may refuse on
City has no jurisdiction. The claim for improper pre-termination of ground of forum non
Kitamaru’s ICA could only be heard & ventilated in the proper convenience
courts of Japan following the principles of lex loci celebrationis &
lex contractus. If it assumes jurisdiction, it
will decide which law to
The RTC denied the motion to dismiss. The CA ruled hat the follow (lex foci of lex pose)
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 fori will 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
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 contractus means 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, 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, 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 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 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
Saudi Arabian Facts: Cause of action: complaint
Airlines v. CA Saudi Arabian Airlines (SAUDIA) hired Milagros Morada as a Flight for damages (court will
Attendant for its airlines based in Jeddah, Saudi Arabia. While on depend on the amount,
a lay-over in Jakarta, Morada went to a disco with fellow crew here it falls in RTC)
members Thamer & Allah, both Saudi nationals. Because it was QC: where Morada resides
almost morning when they returned to their hotels, they agreed
to have breakfast together at the room of Thamer. In which Allah
left on some pretext. Thamer attempted to rape Morada but she Issue: lack of jurisdiction
was rescued by hotel personnel when they heard her cries for
help. Indonesian police came and arrested Thamer and Allah, the How RTC acquired
latter as an accomplice. jurisdiction?
- Personal or
Morada refused to cooperate when SAUDIA’s Legal Officer and its substituted service
base manager tried to negotiate the immediate release of the of summons (action
detained crew members with Jakarta police. in personam
Through the intercession of Saudi Arabian government, Thamer because it is on
and Allah were deported and, eventually, again put in service by damages)
SAUDIA. But Morada was transferred to Manila. - SAUDIA has an
office in Manila
One year and a half year later, Morada was again ordered to see
SAUDIA’s Chief Legal Officer. Instead, she was brought to a Saudi Court did not accept the
court where she was asked to sign a blank document, which ___ convenience because….
turned out to be a notice to her to appear in court. Monada it would be forcing Morada
returned to Manila. to seek remedial action
elsewhere, i.e. in the
The next time she was escorted by SAUDIA’s legal officer to court, Kingdom of Saudi Arabia
the judge rendered a decision against her sentencing her to five where she no longer
months imprisonment and to 286 lashes. Apparently, she was maintains substantial
tried by the court which found her guilty of (1) adultery; (2) going connections. That would
to a disco, dancing and listening to the music in violation of have caused a fundamental
Islamic laws; and (3) socializing with the male crew, in unfairness to her.
contravention of Islamic tradition.

After denial by SAUDIA, Morada sought help from Philippine

Embassy during the appeal. Prince of Makkah dismissed the case
against her. SAUDIA fired her without notice.

Morada filed a complaint for damages against SAUDIA, with the

RTC of QC. SAUDIA filed Omnibus Motion to Dismiss which raised
the ground that the court has no jurisdiction, among others which
was denied

ISSUE: Whether RTC of QC has jurisdiction to hear and try the

case (article 21 of civil code)

HELD: YES. The RTC of QC has jurisdiction and Philippine law

should govern. Its jurisdiction has basis on Sec. 1 of RA 7691 and
Rules of Court on venue. Pragmatic considerations, including the
convenience of the parties, also weigh heavily in favor of the RTC
QC 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
Morada 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.
 By filing a complaint, Morada has voluntarily submitted to the
jurisdiction of the court. By filing several motions and praying for
reliefs (such as dismissal), SAUDIA has effectively submitted to the
trial court’s jurisdiction.
SAUDI ARABIAN *apply the proper law
AIRLINES (SAUDIA)
vs. MA. JOPETTE Provision in employment
M. REBESENCIO contract on pregnancy:
___________

Where it was executed? –

Saudi Arabia

Office – Makati

Provision in the contract

that is appropriate for the
SAUDI but not to others ---
termination of pregnant
women (must not be
contrary to law and public
policy)