CONFLICT OF LAWS airport, the airline had forbidden her to take flight, her
passport was taken away and told her to remain in Jeddah.
CASE DIGESTS
(Week 4 Coverage)
Based on Atty. Atty. Kristine Mae M. Quibod’s Syllabus
Jose Maria College – College of Law
III. CHOICE OF LAW
A. 3 Instances where the forum has to apply the
internal or domestic law (lex fori) in adjudicating a
conflict problem set before it
CASES:
SAUDI ARABIA AIRLINES vs. CA
G.R. No. 122191, October 8, 1998
FACTS:
On January 21, 1988, SAUDI ARABIAN AIRLINES or SAUDIA
(foreign airlines corporation doing business in the Philippines)
hired MORADA as a Flight Attendant for its airlines based in
Jeddah, Saudi Arabia. On April 27, 1990, while on a lay-over in
Jakarta, Indonesia, Morada went to a disco dance with fellow
crewmembers Thamer Al-Gazzawi 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. After Allah left, Thamer
attempted to rape Morada. A roomboy and several security
personnel heard Morada’s cries for help and rescued her. The
Indonesian police came and arrested Thamer and Allah Al-
Gazzawi, the latter as an accomplice.
In September 1990, defendant SAUDIA transferred Morada to
Manila.On January 14, 1992, 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. The police put pressure on her to make a statement
dropping the case against Thamer and Allah. She agreed so the
police returned her passport and allowed her to catch the
afternoon flight out of Jeddah.
On lune 16, 1993, Morada was ordered to take a later flight to
Jeddah. When she did, a certain Khalid of the SAUDIA office
brought her to a Saudi court where she was asked to sign a
document written in Arabic purportedly to close the case
against Thamer and Allah. As it turned out, plaintiff signed a
notice to her to appear before the court on June 27, 1993.
Morada then returned to Manila.
On June 28, 1993, a Saudi judge interrogated Morada for 1
hour through an interpreter about the Jakarta incident. At the
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
On July 3, 1993 a SAUDIA legal officer again escorted plaintiff
to the same court where the judge, to her astonishment and
shock, rendered a decision sentencing her to five months
imprisonment and to 286 lashes. The court found plaintiff
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. Because
she was wrongfully convicted, the Prince of Makkah dismissed
the case against her and allowed her to leave Saudi Arabia.
Shortly before her return to Manila, she was terminated from
the service by SAUDIA, without her being informed of the
cause.
On November 23, 1993, Morada filed a Complaint for damages
against SAUDIA, and Khaled Al-Balawi ("Al-Balawi"), its country
manager. SAUDIA filed an Omnibus Motion To Dismiss, which
was denied, by the trial court. Consequently, SAUDIA filed its
Petition for Certiorari and Prohibition xxx. The Court of
Appeals ruled that the Philippines is an appropriate forum
considering that the Amended Complaint's basis for recovery
of damages is Article 21 of the Civil Code, and thus, clearly
within the jurisdiction of respondent Court.
SAUDIA claimed: that the trial court has no jurisdiction to hear
and try 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. That this is a
conflict of laws, which must be settled at the outset. That
Morada’s claim for alleged abuse of rights occurred in the
Kingdom of Saudi Arabia. The existence of a foreign element
qualifies the instant case for the application of the law of the
Kingdom of Saudi Arabia, by virtue of the lex loci
delicticommissi rule.
ISSUES:
1. Whether or not the problem herein presents a “conflicts”
case. Yes
2. Whether or not Regional Trial Court of Quezon City has
Jurisdiction to hear and try the civil case entitled "Milagros p.
Morada v. Saudi Arabian Airlines". Yes
3. Whether or not Philippine law should govern in this case.
Yes
RULING:
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
(1): YES. Where the factual antecedents satisfactorily establish
the existence of a foreign element, 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 foreign element may simply consist in the fact that one of
the parties to a contract is an alien or has a foreign domicile,
or that a contract between nationals of one State involves
properties situated in another State. In other cases, the foreign
element may assume a complex form.
In the instant case, the foreign element consisted in the fact
that private respondent Morada is a resident Philippine
national, and that petitioner SAUDIA is a resident foreign
corporation. Also, by virtue of the employment of Morada with
the petitioner Saudia as a flight stewardess, events did
transpire during her many occasions of travel across national
borders, particularly from Manila, Philippines to Jeddah, Saudi
Arabia, and vice versa, that caused a "conflicts" situation to
arise.
(2): YES. The Regional Trial Court (RTC) of Quezon City
possesses jurisdiction over the subject matter of the suit.
Morada predicated her cause of action on Articles 19 and 21
of the New Civil Code.
The RTC’s authority to try and hear the case is provided for
under Section 1 of Republic Act No. 7691 which amended Sec.
1. Section 19 of Batas PambansaBlg. 129, otherwise known as
the "Judiciary Reorganization Act of 1980”, to wit: Sec. 19.
Jurisdiction in Civil Cases. — Regional Trial Courts shall exercise
exclusive jurisdiction: x xx x xx x xx
(8) In all other cases in which demand, exclusive of interest,
damages of whatever kind, attorney's fees, litigation expenses,
and cots or the value of the property in controversy exceeds
One hundred thousand pesos (P100,000.00) or, in such other
cases in Metro Manila, where the demand, exclusive of the
above-mentioned items exceeds Two hundred Thousand
pesos (P200,000.00). (Emphasis ours) x xx x xx x xx
Section 2 (b), Rule 4 of the Revised Rules of Court — the venue,
Quezon City, is appropriate: Sec. 2 xxx. (b) Personal actions. —
All other actions may be commenced and tried where the
defendant or any of the defendants resides or may be found,
or where the plaintiff or any of the plaintiff resides, at the
election of the plaintiff.
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. Enforceability of a judgment if one is obtained is quite
obvious. Relative advantages and obstacles to a fair trial are
equally important.
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
The court a quo found it best to hear the case in the
Philippines. Otherwise, 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.
Moreover, by hearing the case in the Philippines, no
unnecessary difficulties and inconvenience have been shown
by either of the parties.
Similarly, the trial court also possesses jurisdiction over the
persons of the parties herein. By filing her Complaint and
Amended Complaint with the trial court, Morada has voluntary
submitted herself to the jurisdiction of the court. The records
show that petitioner SAUDIA has filed several motions 50
praying for the dismissal of Morada's Amended Complaint.
SAUDIA prayed for other reliefs under the premises.
Undeniably, petitioner SAUDIA has effectively submitted to
the trial court's jurisdiction by praying for the dismissal of the
Amended Complaint on grounds other than lack of jurisdiction.
HELD (3): YES. As to the choice of applicable law, there are two
important questions: (1) What legal system should control a
given situation where some of the significant facts occurred in
two or more states; and (2) to what extent should the chosen
legal system regulate the situation.
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.
An essential element of conflict rules is the indication of a
"test" or "connecting factor" or "point of contact". Choice-of-
law rules invariably consist of a factual relationship (such as
property right, contract claim) and a connecting factor or point
of contact, such as the situs of the res, the place of celebration,
the place of performance, or the place of wrongdoing. 58
These "test factors" or "points of contact" or "connecting
factors" could be any of the following:
The nationality of a person, his domicile, his residence, his
place of sojourn, or his origin;the seat of a legal or juridical
person, such as a corporation; 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; 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;
2
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
The place where an act is intended to come into effect, e.g.,
the place of performance of contractual duties xxx.
The intention of the contracting parties as to the law that
should govern their agreement, the lex loci intentionis;
The place where judicial or administrative proceedings are
instituted or done. The lexfori — the law of the forum xxx.
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. Xxx.
Although Morada was already working in Manila, SAUDIA
brought her to Jeddah on the pretense that she would merely
testify in an investigation of the charges against her SAUDIA
crewmembers. 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.
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
SAUDIA allegedly deceived Morada, a Filipina residing and
working here.
In applying the State of the most significant relationshiprule to
determine the State, which has the most significant
relationship, the following contacts are to be taken into
account and evaluated according to their relative importance
with respect to the particular issue: the place where the injury
occurred; the place where the conduct causing the injury
occurred; the domicile, residence, nationality, place of
incorporation and place of business of the parties, and the
place where the relationship, if any, between the parties is
centered.
As already discussed, there is basis for the claim that over-all
injury occurred and lodged in the Philippines. Also, Morada is
a resident Filipina national, working with SAUDIA, a resident
foreign corporation engaged here in the business of
international air carriage. Thus, the "relationship" between the
parties was centered here, although it should be stressed that
this suit is not based on mere labor law violations.
Philippine law on tort liability should have paramount
application to and control in the resolution of the legal issues
arising out of this case. Further, the Regional Trial Court has
jurisdiction over the parties and the subject matter of the
complaint; the appropriate venue is in Quezon City, which
could properly apply Philippine law.
Lastly, Morada has "no obligation to plead and prove the law
of the Kingdom of Saudi Arabia since her cause of action is
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
based on Articles 19 and 21" of the Civil Code of the Philippines
and never alleged that Saudi law should govern this case. And
as correctly held by the respondent appellate court,
"considering that it was SAUDIA who was invoking the
applicability of the law of Saudi Arabia, then the burden was
on it to plead and to establish what the law of Saudi Arabia is".
PHIL. EXPORT AND FOREIGN LOAN GUARANTEE CORP. V.
V.P. EUSEBIO CONSTRUCTION INC.
G.R. No. 140047 March 31, 2003
FACTS:
State Organization of Buildings (SOB), Ministry of Housing and
Construction, Baghdad, Iraq, awarded the construction of the
Institute of Physical Therapy–Medical Rehabilitation Center,
Phase II, in Baghdad, Iraq, (Project) to Ajyal Trading Company
(Ajyal), a firm duly licensed with the Kuwait Chamber of
Commerce. 3-Plex International, Inc., a local contractor
engaged in construction business, entered into a joint venture
agreement with Ajyal. However since it was not accredited
under the Philippine Overseas Construction Board (POCB), it
had to assign and transfer all its right to V.P. Eusebio
Construction, Inc. (VPECI). VPECI entered into an agreement
that the execution of the project will be under their joint
management.
To comply with the requirements of performance bond 3-Plex
and VPECI applied for the issuance of a guarantee with
Philguarantee, a government financial institution empowered
to issue guarantees for qualified Filipino contractors to secure
the performance of approved service contracts abroad.
Subsequently, letters of guarantee were issued by
Philguarantee to the Rafidain Bank of Baghdad. Al Ahli Bank of
Kuwait was, therefore, engaged to provide a counter-
guarantee to Rafidain Bank, but it required a similar counter-
guarantee in its favor from the Philguarantee.
SOB and the joint venture VPECI and Ajyal executed the service
contract for the construction of the project .Prior to the
deadline, upon foreseeing the impossibility to meet it because
of the Iraq War, the surety bond was also extended for more
than 12 times until May 1987 and the Advance Payment
Guarantee was extended three times more until it was
cancelled for reimbursement.
Al Ahli Bank of Kuwait demanded full payment of its
performance bond counter-guarantee. VPECI advised the
Philguarantee not to pay yet Al Ahli Bank because efforts were
being exerted for the amicable settlement of the Project.
However, Philguarantee informed VPECI it would remit
payment to Al Ahli Bank, and reiterated the joint and solidary
obligation of the respondents to reimburse the Philguarantee
3
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
for the advances made on its counter-guarantee but they
failed to pay.
ISSUE:
Should the Philippine laws be applied in determining VPECI's
default in the performance of its obligations under the service
contract?
RULING:
YES. There is no conflicts rule on essential validity of contracts
expressly provided for in our laws. The rule followed by most
legal systems, however, is that the intrinsic validity of a
contract must be governed by the lex contractus or "proper
law of the contract." This is the law voluntarily agreed upon by
the parties (the lex loci voluntatis) or the law intended by them
either expressly or implicitly (the lex loci intentionis) - none in
this case. In the United States and Europe, the two rules that
now seem to have emerged as "kings of the hill" are (1) the
parties may choose the governing law; and (2) in the absence
of such a choice, the applicable law is that of the State that
"has the most significant relationship to the transaction and
the parties. Another authority proposed that all matters
relating to the time, place, and manner of performance and
valid excuses for non-performance are determined by the law
of the place of performance or lex loci solutionis, which is
useful because it is undoubtedly always connected to the
contract in a significant way.
In this case, the laws of Iraq bear substantial connection to the
transaction, since one of the parties is the Iraqi Government
and the place of performance is in Iraq. Hence, the issue of
whether respondent VPECI defaulted in its obligations may be
determined by the laws of Iraq. However, since that foreign
law was not properly pleaded or proved, the presumption of
identity or similarity, otherwise known as the processual
presumption, comes into play. Where foreign law is not
pleaded or, even if pleaded, is not proved, the presumption is
that foreign law is the same as ours.
The delay or the non-completion of the Project was caused by
factors not imputable to the respondent contractor such as the
war in Iraq. Petitioner as a guarantor, as ruled by the court, is
entitled to the benefit of excussion, that is, it cannot be
compelled to pay the creditor SOB unless the property of the
debtor VPECI has been exhausted and all legal remedies
against the said debtor have been resorted to by the creditor.
It could also set up compensation as regards what the creditor
SOB may owe the principal debtor VPECI. In this case,
however, the petitioner has clearly waived these rights and
remedies by making the payment of an obligation that was yet
to be shown to be rightfully due the creditor and demandable
of the principal debtor.
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
CRESCENT PETROLEUM V. M/V LOK MAHESHWARI
G.R. NO. 155014 NOVEMBER 11, 2005
FACTS:
M/V Lok Maheshwari is an Indian Vessel owned by Shipping
Corporation of India (SCI). It was time chartered to Halla
Merchant (a Korean Company). Halla sub-chartered it to
Trasmar Shipping. Transmar sub-chartered it further to
Portserv. The latter companies being organized under the laws
of Canada.
Portserv requested Crescent Petroleum to deliver bunker fuels
to the vessel. Crescent received 2 checks as security for this
transaction and then contacted its supplier Marine Petrobulk.
Now, Marine Petrobulk delivered the bunker fuels amounting
to US$103,544 which Crescent paid.
Crescent now demanded from Portserv such amount until
December 1, 1995. However, Portserv after several demands,
failed to pay. Crescent was forced to encash the checks issued
by Portserv as security but it were dishonored for insufficiency
of funds causing Crescent to suffer more additional expenses
and damages.
While the vessel was docked in Cebu, Crescent instituted an
action against SCI, Portserv and Transmar before RTC of Cebu
City for “a sum of money with prayer for TRO and writ of
Preliminary attachment”. Here, all of the respondents failed to
file their answers thus the RTC declared them in default. Upon
presenting evidence ex-parte, Crescent obtained favorable
judgment.
The CA reversed the order and dismissed the case for want of
jurisdiction. Crescent contends that they are entitled to
maritime lien under our laws provided under Sec. 21, 22, and
23 of P.D. No. 1521(Ship Mortgage Decree of 1978). Portserv
contends that these provisions does not apply to a foreign
supplier as the provision refers only to a situation where the
person furnishing the supplies is situated inside the territory of
the Philippines and not where the necessaries were furnished
in a foreign jurisdiction like Canada.
ISSUE:
Should our Courts apply P.D. No. 1521 (a domestic law) in
solving this controversy?
HELD:
No. The various tests used in the U.S. to determine whether a
maritime lien exists are the following:
4
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
"In a suit to establish and enforce a maritime lien for supplies
furnished to a vessel in a foreign port, whether such lien exists,
or whether the court has or will exercise jurisdiction, depends
on the law of the country where the supplies were furnished,
which must be pleaded and proved."
The Lauritzen-Romero-Rhoditis trilogy of cases, which
replaced such single-factor methodologies as the law of the
place of supply. A multiple-contact test to determine, in the
absence of a specific Congressional directive as to the statute’s
reach, which jurisdiction’s law should be applied. Following
factors were considered: (1) place of the wrongful act; (2) law
of the flag; (3) allegiance or domicile of the injured; (4)
allegiance of the defendant shipowner; (5) place of contract;
(6) inaccessibility of foreign forum; and (7) law of the forum.
The factors provided in Restatement (Second) of Conflicts of
Law have also been applied, especially in resolving cases
brought under the Federal Maritime Lien Act. Their application
suggests that in the absence of an effective choice of law by
the parties, the forum contacts to be considered include: (a)
the place of contracting; (b) the place of negotiation of the
contract; (c) the place of performance; (d) the location of the
subject matter of the contract; and (e) the domicile, residence,
nationality, place of incorporation and place of business of the
parties.
In this case, the court cannot sustain Crescent’s insistence on
the application of P.D. No. 1521. First, out of the seven basic
factors listed in the case of Lauritzen, Philippine law only falls
under one – the law of the forum. All other elements are
foreign – Canada is the place of the wrongful act, of the
allegiance or domicile of the injured and the place of contract;
India is the law of the flag and the allegiance of the defendant
shipowner. Second, P.D. No. 1521 or the Ship Mortgage
Decree of 1978 is inapplicable following the factors under
Restatement (Second) of Conflict of Laws. P.D. No. 1521was
enacted primarily to protect Filipino suppliers and was not
intended to create a lien from a contract for supplies between
foreign entities delivered in a foreign port. Third, Applying P.D.
No. 1521 or the Ship Mortgage Decree of 1978 and rule that a
maritime lien exists would not promote the public policy
behind the enactment of the law to develop the domestic
shipping industry. Opening up our courts to foreign suppliers
by granting them a maritime lien under our laws even if they
are not entitled to a maritime lien under their laws will
encourage forum shopping. Finally, The submission of
petitioner is not in keeping with the reasonable expectation of
the parties to the contract. Indeed, when the parties entered
into a contract for supplies in Canada, they could not have
intended the laws of a remote country like the Philippines to
determine the creation of a lien by the mere accident of the
Vessel’s being in Philippine territory.
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
LWV CONSTRUCTION CORPORATION vs. MARCELO B. DUPO
G.R. No. 172342, July 13, 2009
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 (MMG). Respondent Marcelo signed his
first overseas employment contract, renewable after one year.
After how many years, he informed MMG, through the
petitioner, that he needs to extend his vacation because his
son was hospitalized. In reply, MMG informed respondent that
his promotion is subject to management’s review. Eventually,
he resigned but also requested for a long service award under
the Saudi Law for the seven years of service he rendered in the
company. When he received no response from LWV, he filed a
complaint for payment of service award with the National
Labor Relations Commission (NLRC).
For its part, petitioner offered payment and prescription as
defenses. Petitioner said that under Article 1310 of the 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. Respondent’s six contracts
ended when he left Saudi Arabia on the following dates: April
15, 1993, June 8, 1994, December 18, 1995, March 21, 1997,
March 16, 1998 and April 30, 1999. 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.
ISSUE:
Whether the Saudi Labor Law shall be applied in the case of
prescription
RULING:
NO. What applies in this case is Article 291 of our Labor Code
which reads:
ART. 291. Money claims. — All money claims arising from
employer-employee relations accruing during the effectivity of
this Code shall be filed within three (3) years from the time the
cause of action accrued; otherwise they shall be forever
barred.
As a general rule, a foreign procedural law will not be applied
in the forum. Procedural matters, such as service of process,
joinder of actions, period and requisites for appeal, and so
forth, are governed by the laws of the forum. This is true even
if the action is based upon a foreign substantive law. A law on
prescription of actions is sui generis in Conflict of Laws in the
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
sense that it may be viewed either as procedural or
substantive, depending on the characterization given such a
law.
The courts of the forum will not enforce any foreign claim
obnoxious to the forum’s public policy x x x. To enforce the
one-year prescriptive period as regards the claims in question
would contravene the public policy on the protection to labor.
Hence, the action has not yet prescribed pursuant to our Labor
Code.
DEUTSCHE GESELLSCHAF VS. HON. COURT OF APPEALS
G.R. No. 152318. April 16, 2009
FACTS:
On September 7, 1971, The Philippines and Germany ratified
an Agreement concerning Technical Co-operation and
promoting the technical and economic development between
the countries, in Bonn, capital of what was then West
Germany. The Agreement affirmed the countries’ common
interest in promoting the technical and economic
development of their States, and recognized the benefits to be
derived by both States from closer technical co-operation, and
allowed for the conclusion of arrangements concerning
individual projects of technical co-operation. While the
Agreement provided for a limited term of effectivity of five (5)
years, it nonetheless was stated that the Agreement shall be
tacitly extended for successive periods of one year unless
either of the two Contracting Parties denounces it in writing
three months prior to its expiry and that even upon the
Agreement’s expiry, its provisions would continue to apply to
any projects agreed upon until their completion. On 10
December 1999, the Philippine government, through then
Foreign Affairs Secretary Domingo Siazon, and the German
government, agreed to an Arrangement in furtherance of the
1971 Agreement. This Arrangement affirmed the common
commitment of both governments to promote jointly a project
called, Social Health Insurance Networking and Empowerment
(SHINE), which was designed to enable Philippine families
especially poor ones to maintain their health and secure health
care of sustainable quality. It appears that SHINE had already
been in existence even prior to the effectivity of the
Arrangement, though the record does not indicate when
exactly SHINE was constituted.
In the arraignment, both governments likewise named their
respective implementing organizations for SHINE. The
Philippines designated the Department of Health (DOH) and
the Philippine Health Insurance Corporation (Philhealth) with
the implementation of SHINE. For their part, the German
government "charge[d] the Deustche Gesellschaft für
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
Technische Zusammenarbeit (GTZ) GmbH, Eschborn, with the
implementation of its contributions."
Private respondents were engaged as contract employees
hired by GTZ to work for SHINE on various dates between
December of 1998 to September of 1999. Bernadette Carmela
Magtaas was hired as an information systems manager and
project officer of SHINE;Carolina Dionco as a Project Assistant
of SHINE; Christopher Ramos as a project assistant and liason
personnel of NHI related SHINE activities by GTZ; Melvin Dela
Paz and Randy Tamayo as programmers; and Edgardo Ramilo
as driver, messenger and multipurpose service man.The
employment contracts of all six private respondents all
specified Dr. Rainer Tollkotter, identified as an adviser of GTZ,
as the employer. At the same time, all the contracts commonly
provided that it is mutually agreed and understood that Dr.
Tollkotter, as employer is a seconded GTZ expert who is hiring
the Employee on behalf of GTZ and for a Philippine-German
bilateral project named ‘Social Health Insurance Networking
and Empowerment (SHINE)’ which will end at a given time. In
September of 1999, when a new project manager, Anne
Nicolay, was hired, disagreements arose between Nicolay and
the respondents such as matters of salary adjustment and the
course Nicolay is taking the project SHINE. The private
respondents wrote a letter to Nicolay raising several issues
which had been brought up in the past but were still
unheeded. The letter ended with the following words: The
issues that we the private respondents have stated here are
very crucial to us in working for the project. We could no
longer find any reason to stay with the project unless ALL of
these issues be addressed immediately and appropriately.
Nicolay replied by informing them of the pre-termination of
their contracts due to serious and gross insubordination
among others, resulting to loss of confidence and trust.”
The respondents filed a complaint for illegal dismissal with the
NLRC. GTZ filed a motion to dismiss on the ground that the
NLRC had no jurisdiction over the case as its acts were
undertaken in the discharge of the governmental functions
and sovereign acts of the Government of the Federal Republic
of Germany. Thus, it should be immune from suit.
ISSUE:
Is GTZ, by conception, able to enjoy the Federal Republic’s
immunity from suit?
RULING:
No. The SC held that GTZ consistently has been unable to
establish with satisfaction that it enjoys the immunity from suit
generally enjoyed by its parent country, the Federal Republic
of Germany. The principle of state immunity from suit,
whether a local state or a foreign state, is reflected in Section
6
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
9, Article XVI of the Constitution, which states that “the State
may not be sued without its consent.” Who or what consists of
“the State”? For one, the doctrine is available to foreign States
insofar as they are sought to be sued in the courts of the local
State, necessary as it is to avoid “unduly vexing the peace of
nations.” State immunity from suit may be waived by general
or special law. The special law can take the form of the original
charter of the incorporated government agency.
Jurisprudence is replete with examples of incorporated
government agencies which were ruled not entitled to invoke
immunity from suit, owing to provisions in their charters
manifesting their consent to be sued. GTZ’s own website
elicits that petitioner is “federally owned,” a “federal
enterprise,” and “founded in 1975 as a company under private
law.” GTZ clearly has a very meaningful relationship with the
Federal Republic of Germany, which apparently owns it. At the
same time, it appears that GTZ was actually organized not
through a legislative public charter, but under private law, in
the same way that Philippine corporations can be organized
under the Corporation Code even if fully owned by the
Philippine government. This self-description of GTZ in its own
official website gives further cause for pause in adopting
petitioners’ argument that GTZ is entitled to immunity from
suit because it is “an implementing agency.” The above-quoted
statement does not dispute the characterization of GTZ as an
“implementing agency of the Federal Republic of Germany,”
yet it bolsters the notion that as a company organized under
private law, it has a legal personality independent of that of
the Federal Republic of Germany.
The Supreme Court adheres to the rule that in the absence of
evidence to the contrary, foreign laws on a particular subject
are presumed to be the same as those of the Philippines and
following the most intelligent assumption we can gather, GTZ
is akin to a governmental owned or controlled corporation
without original charter which, by virtue of the Corporation
Code, has expressly consented to be sued. It is entirely possible
that under German law, an entity such as GTZ or particularly
GTZ itself has not been vested or has been specifically deprived
the power and capacity to sue and/or be sued. Yet in the
proceedings below and before this Court, GTZ has failed to
establish that under German law, it has not consented to be
sued despite it being owned by the Federal Republic of
Germany. At the very least, like the Labor Arbiter and the Court
of Appeals, the SC held that it has no basis in fact to conclude
or presume that GTZ enjoys immunity from suit. In Public
International Law, when a state or international agency wishes
to plead sovereign or diplomatic immunity in a foreign court,
it requests the Foreign Office of the state where it is sued to
convey to the court that said defendant is entitled to
immunity.
The requirement to secure from the Department of Foreign
Affairs “a certification of respondents’ diplomatic status and
entitlement to diplomatic privileges including immunity from
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
suits” might not necessarily be imperative but, had GTZ
obtained such certification from the Department of Foreign
Affairs (DFA), it would have provided factual basis for its claim
of immunity that would, at the very least, establish a
disputable evidentiary presumption that the foreign party is
indeed immune which the opposing party will have to
overcome with its own factual evidence. And the fact that the
Solicitor General has endorsed GTZ’s claim of State’s immunity
from suit before the Supreme Court does not sufficiently
substitute for the Department of Foreign Affairs (DFA)
certification. Lastly, the nature of the acts performed by the
entity invoking immunity remains the most important
barometer for testing whether the privilege of State immunity
from suit should apply.
ATCI OVERSEAS CORPORATION, AMALIA G. IKDAL and
MINISTRY OF PUBLIC HEALTH-KUWAIT vs. MA. JOSEFA
ECHIN
G.R. No. 178551, October 11, 2010
FACTS:
Josefina Echin (respondent) was hired by petitioner ATCI
Overseas Corporation in behalf of its principal-co-petitioner,
the Ministry of Public Health of Kuwait (the Ministry), for the
position of medical technologist under a two-year contract.
Under the MOA, all newly-hired employees undergo a
probationary period of one (1) year and are covered by
Kuwait’s Civil Service Board Employment Contract No. 2
Respondent was deployed but was terminated from
employment, she not having allegedly passed the probationary
period.
Respondent filed with the National Labor Relations
Commission (NLRC) a complaint2 for illegal dismissal against
petitioner ATCI as the local recruitment agency.
Petitioners maintain that they should not be held liable
because respondent’s employment contract specifically
stipulates that her employment shall be governed by the Civil
Service Law and Regulations of Kuwait. They argue that even
the Philippine Overseas Employment Act (POEA) Rules relative
to master employment contracts (Part III, Sec. 2 of the POEA
Rules and Regulations) accord respect to the "customs,
practices, company policies and labor laws and legislation of
the host country."
ISSUES:
1. What law should be applied? (Philippine law)
2. Whether or not the foreign law was proved? (NO)
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
RULING:
1. Philippine Law applying processual presumption.
In the present case, the employment contract signed by Gran
specifically states that Saudi Labor Laws will govern matters
not provided for in the contract (e.g. specific causes for
termination, termination procedures, etc.). Being the law
intended by the parties (lex loci intentiones) to apply to the
contract, Saudi Labor Laws should govern all matters relating
to the termination of the employment of Gran.
Unfortunately for petitioner, it did not prove the pertinent
Saudi laws on the matter; thus, the International Law doctrine
of presumed-identity approach or processual presumption
comes into play. Philippines does not take judicial notice of
foreign laws, hence, they must not only be alleged; they must
be proven.
In international law, the party who wants to have a foreign law
applied to a dispute or case has the burden of proving the
foreign law. The foreign law is treated as a question of fact to
be properly pleaded and proved as the judge or labor arbiter
cannot take judicial notice of a foreign law. He is presumed to
know only domestic or forum law.
To prove the Kuwaiti law, petitioners submitted the following:
1. MOA between respondent and the Ministry, as represented
by ATCI;
2. A translated copy11 (Arabic to English) of the termination
letter; and
3. A translated copy of the certificate of termination
These documents, whether taken singly or as a whole, do not
sufficiently prove that respondent was validly terminated as a
probationary employee under Kuwaiti civil service laws.
Instead of submitting a copy of the pertinent Kuwaiti labor
laws duly authenticated and translated by Embassy officials
thereat, as required under the Rules, what petitioners
submitted were mere certifications attesting only to the
correctness of the translations of the MOA and the
termination letter which does not prove at all that Kuwaiti civil
service laws differ from Philippine laws and that under such
Kuwaiti laws, respondent was validly terminated.
2. Proof of foreign law: To prove a foreign law, the party
invoking it must present a copy thereof and comply with
Sections 24 and 25 of Rule 132 of the Revised Rules of Court
which reads:
SEC. 24. Proof of official record. — The record of public
documents referred to in paragraph (a) of Section 19, when
admissible for any purpose, may be evidenced by an official
publication thereof or by a copy attested by the officer having
the legal custody of the record, or by his deputy, and
accompanied, if the record is not kept in the Philippines, with
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
a certificate that such officer has the custody. If the office in
which the record is kept is in a foreign country, the certificate
may be made by a secretary of the embassy or legation, consul
general, consul, vice consul, or consular agent or by any officer
in the foreign service of the Philippines stationed in the foreign
country in which the record is kept, and authenticated by the
seal of his office. (emphasis supplied)
SEC. 25. What attestation of copy must state. — Whenever a
copy of a document or record is attested for the purpose of the
evidence, the attestation must state, in substance, that the
copy is a correct copy of the original, or a specific part thereof,
as the case may be. The attestation must be under the official
seal of the attesting officer, if there be any, or if he be the clerk
of a court having a seal, under the seal of such court.
Applying Philippine Laws, specifically section 10 of RA 8042,
the liability of the principal/employer and the
recruitment/placement agency for any and all claims under
this section shall be joint and several.
SAUDI ARABIAN AIRLINES (SAUDIA) AND BRENDA J. BETIA,
v. MA. JOPETTE M. REBESENCIO, MONTASSAH B. SACAR-
ADIONG, ROUEN RUTH A. CRISTOBAL AND LORAINE S.
SCHNEIDER-CRUZ
G.R. No. 198587, January 14, 2015
FACTS:
Rebesencio et al were recruited and hired by Saudi Arabian
Airlines (Saudia), a foreign corporation established and
existing under the laws of Jeddah, Kingdom of Saudi Arabia, as
Permanent Flight Attendants. They entered into Cabin
Attendant contracts with Saudia.
Rebesencio et al continued their employment with Saudia until
they were separated from service on various dates in 2006.
Rebesencio et al contended that the termination of their
employment was illegal. They alleged that the termination was
made solely because they were pregnant. They alleged that
they had informed Saudia of their respective pregnancies and
had gone through the necessary procedures to process their
maternity leaves. Initially, Saudia had given its approval but
later on informed them that its management in Jeddah, Saudi
Arabia had disapproved their maternity leaves. In addition, it
required them to file their resignation letters and that if they
do not resign, Saudia would terminate them all the same.
Saudia anchored its disapproval of Rebesencio et al's
maternity leaves and demand for their resignation on its
"Unified Employment Contract for Female Cabin Attendants"
(Unified Contract). Under the Unified Contract, the
employment of a Flight Attendant who becomes pregnant is
rendered void.
8
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
Rebesencio et al filed a Complaint against Saudia and its
officers for illegal dismissal and for underpayment of salary
and other benefits before the Labor Arbiter.
Saudia assailed the jurisdiction of the Labor Arbiter. It claimed
that all the determining points of contact referred to foreign
law and insisted that the Complaint ought to be dismissed on
the ground of forum non conveniens.
The Labor Arbiter rendered a decision dismissing Rebesencio
et al's Complaint.
On appeal, National Labor Relations Commission reversed the
ruling of Labor. It explained that "[considering that
complainants-appellants are OFWs, the Labor Arbiters and the
NLRC has [sic] jurisdiction to hear and decide their complaint
for illegal termination." On the matter of forum non
conveniens, it noted that there were no special circumstances
that warranted its abstention from exercising jurisdiction.
On appeal, CA denied Saudia’s petition.
ISSUE:
Does the Philippine Courts in position to make intelligent
decision as to what law governs this case?
HELD:
Yes, the Philippine Courts is in position to make intelligent
decision as to what law governs this case.
Saudia asserts that Philippine courts and/or tribunals are not
in a position to make an intelligent decision as to the law and
the facts. This is because respondents' Cabin Attendant
contracts require the application of the laws of Saudi Arabia,
rather than those of the Philippines. It claims that the difficulty
of ascertaining foreign law calls into operation the principle
of forum non conveniens, thereby rendering improper the
exercise of jurisdiction by Philippine tribunals.
A choice of law governing the validity of contracts or the
interpretation of its provisions does not necessarily
imply forum non conveniens. Choice of law and forum non
conveniens are entirely different matters.
Choice of law provisions are an offshoot of the fundamental
principle of autonomy of contracts.
In contrast, forum non conveniens is a device akin to the rule
against forum shopping. It is designed to frustrate illicit means
for securing advantages and vexing litigants that would
otherwise be possible if the venue of litigation (or dispute
resolution) were left entirely to the whim of either party.
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
Contractual choice of laws factors into transnational litigation
in any or a combination of four (4) ways: (1) procedures for
settling disputes, e.g., arbitration; (2) forum, i.e., venue; (3)
governing law; and (4) basis for interpretation. Forum non
conveniens relates to one of these: choosing between multiple
possible fora.
Forum non conveniens literally translates to "the forum is
inconvenient."62 It is a concept in private international law and
was devised to combat the "less than honorable" reasons and
excuses that litigants use to secure procedural advantages,
annoy and harass defendants, avoid overcrowded dockets,
and select a "friendlier" venue.63 Thus, the doctrine of forum
non conveniens addresses the same rationale that the rule
against forum shopping does, albeit on a multijurisdictional
scale.
Forum non conveniens, like res judicata, is a concept
originating in common law.65 However, unlike the rule on res
judicata, as well as those on litis pendentia and forum
shopping, forum non conveniens finds no textual anchor,
whether in statute or in procedural rules, in our civil law
system. Nevertheless, jurisprudence has applied forum non
conveniens as basis for a court to decline its exercise of
jurisdiction.
Forum non conveniens is soundly applied not only to address
parallel litigation and undermine a litigant's capacity to vex and
secure undue advantages by engaging in forum shopping on an
international scale. It is also grounded on principles of comity
and judicial efficiency.
Consistent with the principle of comity, a tribunal's desistance
in exercising jurisdiction on account of forum non
conveniens is a deferential gesture to the tribunals of another
sovereign. It is a measure that prevents the former's having to
interfere in affairs which are better and more competently
addressed by the latter. Further, forum non conveniens entails
a recognition not only that tribunals elsewhere are better
suited to rule on and resolve a controversy, but also, that these
tribunals are better positioned to enforce judgments and,
ultimately, to dispense justice. Forum non
conveniens prevents the embarrassment of an awkward
situation where a tribunal is rendered incompetent in the face
of the greater capability — both analytical and practical — of
a tribunal in another jurisdiction.
Accordingly, under the doctrine of forum non conveniens, "a
court, in conflicts of law 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." In Puyat v. Zabarte, this court
recognized the following situations as among those that may
warrant a court's desistance from exercising jurisdiction:
9
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
1. The belief that the matter can be better tried and decided
elsewhere, either because the main aspects of the case
transpired in a foreign jurisdiction or the material witnesses
have their residence there;
2. The belief that the non-resident plaintiff sought the forum[,]
a practice known as forum shopping[,] merely to secure
procedural advantages or to convey or harass the defendant
3. The unwillingness to extend local judicial facilities to non
residents or aliens when the docket may already be
overcrowded;
4. The inadequacy of the local judicial machinery for
effectuating the right sought to be maintained; and
5. The difficulty of ascertaining foreign law.
Here, the circumstances of the parties and their relation do not
approximate the circumstances enumerated in Puyat, which
this court recognized as possibly justifying the desistance of
Philippine tribunals from exercising jurisdiction.
First, there is no basis for concluding that the case can be more
conveniently tried elsewhere. As established earlier, Saudia is
doing business in the Philippines. For their part, all four (4)
respondents are Filipino citizens maintaining residence in the
Philippines and, apart from their previous employment with
Saudia, have no other connection to the Kingdom of Saudi
Arabia. It would even be to respondents' inconvenience if this
case were to be tried elsewhere.
Second, the records are bereft of any indication that
respondents filed their Complaint in an effort to engage in
forum shopping or to vex and inconvenience Saudia.
Third, there is no indication of "unwillingness to extend local
judicial facilities to non-residents or aliens."93 That Saudia has
managed to bring the present controversy all the way to this
court proves this.
Fourth, it cannot be said that the local judicial machinery is
inadequate for effectuating the right sought to be maintained.
Summons was properly served on Saudia and jurisdiction over
its person was validly acquired.
Lastly, there is not even room for considering foreign law.
Philippine law properly governs the present dispute.
As the question of applicable law has been settled, the
supposed difficulty of ascertaining foreign law (which requires
the application of forum non conveniens) provides no
insurmountable inconvenience or special circumstance that
will justify depriving Philippine tribunals of jurisdiction.
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
CONTINENTAL MICRONESIA INC. V. JOSEPH BASSO
G.R. Nos. 178382-83; September 23, 2015
FACTS:
Continental Micronesia Inc. (CMI) is a foreign corporation
organized and existing under the laws of and domiciled in the
United States of America. It is licensed to do business in the
Philippines. Joseph Basso, a US citizen residing in the
Philippines, accepted an offer to be a General Manager
position by Mr. Braden, Managing Director-Asia of Continental
Airlines. On November 7, 1992, CMI took over the Philippine
operations of Continental, with Basso retaining his position as
General Manager. Thereafter, Basso received a letter from Mr.
Schulz, who was then CMI’s Vice President of Marketing and
Sales, informing him that he has agreed to work in CMI as a
consultant on an “as needed basis.” Basso wrote a counter-
proposal that was rejected by CMI.
Basso then filed a complaint for illegal dismissal against the
CMI. Alleging the presence of foreign elements, CMI filed a
Motion to Dismiss on the ground of lack of jurisdiction over the
person of CMI and the subject matter of the controversy.
The Labor Arbiter agreed with CMI that the employment
contract was executed in the US “since the letter-offer was
under the Texas letterhead and the acceptance of
Complainant was returned there.” Thus, applying the doctrine
of lex loci celebrationis, US laws apply. Also, applying lex loci
contractus, the Labor Arbiter ruled that the parties did not
intend to apply Philippine laws.
The NLRC ruled that the Labor Arbiter acquired jurisdiction
over the case when CMI voluntarily submitted to his office’s
jurisdiction by presenting evidence, advancing arguments in
support of the legality of its acts, and praying for reliefs on the
merits of the case.
The Court of Appeals ruled that the Labor Arbiter and the NLRC
had jurisdiction over the subject matter of the case and over
the parties.
ISSUES:
1. Whether labor tribunals have jurisdiction over the case.
2. Whether the local forum is the convenient forum in light of
the facts of the case.
3. Whether Philippine law should govern the case.
RULING:
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
1. Yes. The Court ruled that the labor tribunals had jurisdiction
over the parties and the subject matter of the case. Jurisdiction
is defined as the power and authority of the courts to hear, try
and decide cases. Jurisdiction over the subject matter is
conferred by the Constitution or by law and by the material
allegations in the complaint, regardless of whether or not the
plaintiff is entitled to recover all or some of the claims or reliefs
sought therein. It cannot be acquired through a waiver or
enlarged by the omission of the parties or conferred by the
acquiescence of the court.That the employment contract of
Basso was replete with references to US laws, and that it
originated from and was returned to the US, do not
automatically preclude our labor tribunals from exercising
jurisdiction to hear and try this case.This case stemmed from
an illegal dismissal complaint. The Labor Code, under Article
217, clearly vests original and exclusive jurisdiction to hear and
decide cases involving termination disputes to the Labor
Arbiter. Hence, the Labor Arbiter and the NLRC have
jurisdiction over the subject matter of the case.
As regards to jurisdiction over the parties, the Labor Arbiter
acquired jurisdiction over the person of Basso,
notwithstanding his citizenship, when he filed his complaint
against CMI. On the other hand, jurisdiction over the person of
CMI was acquired through the coercive process of service of
summons. CMI never denied that it was served with summons.
CMI has, in fact, voluntarily appeared and participated in the
proceedings before the courts. Though a foreign corporation,
CMI is licensed to do business in the Philippines and has a local
business address here. The purpose of the law in requiring that
foreign corporations doing business in the country be licensed
to do so, is to subject the foreign corporations to the
jurisdiction of our courts.
Considering that the Labor Arbiter and the NLRC have
jurisdiction over the parties and the subject matter of this case,
these tribunals may 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 being an exercise of sovereign prerogative
of the country where the case is filed.
2. Yes. Under the doctrine of forum non conveniens, a
Philippine court in a conflict-of-laws case may assume
jurisdiction 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. All these requisites
are present here.
Basso may conveniently resort to our labor tribunals as he and
CMI lad physical presence in the Philippines during the
duration of the trial. CMI has a Philippine branch, while Basso,
before his death, was residing here. Thus, it could be
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
reasonably expected that no extraordinary measures were
needed for the parties to make arrangements in advocating
their respective cases.The labor tribunals can make an
intelligent decision as to the law and facts. The incident subject
of this case (i.e. dismissal of Basso) happened in the
Philippines, the surrounding circumstances of which can be
ascertained without having to leave the Philippines.
3. Yes. The choice-of-law issue in a conflict-of-laws case seeks
to answer the following important questions: (1) What legal
system should control a given situation where some of the
significant facts occurred in two or more states; and (2) to what
extent should the chosen legal system regulate the situation.
As such, the power to exercise jurisdiction does not
automatically give a state constitutional authority to apply
forum law.
In Saudi Arabian Airlines v. Court of Appeals, this court
emphasized that an essential element of conflict rules is the
indication of a "test" or "connecting factor" or "point of
contact". Choice-of-law rules invariably consist of a factual
relationship (such as property right, contract claim) and a
connecting fact or point of contact, such as the situs of the res,
the place of celebration, the place of performance, or the place
of wrongdoing. Pursuant to Saudi Arabian Airlines, we hold
that the "test factors," "points of contact" or "connecting
factors" in this case are the following:
(1) The nationality, domicile or residence of Basso;
(2) The seat of CMI;
(3) The place where the employment contract has been made,
the locus actus;
(4) The place where the act is intended to come into effect,
e.g., the place of performance of contractual duties;
(5) The intention of the contracting parties as to the law that
should govern their agreement, the lex loci intentionis; and
(6) The place where judicial or administrative proceedings are
instituted or done
Basso, though a US citizen, was a resident here from he time
he was hired by CMI until his death during the pendency of the
case. CMI, while a foreign corporation, has a license to do
business in the Philippines and maintains a branch here, where
Basso was hired to work. The contract of employment was
negotiated in the Philippines. A purely consensual contract, it
was also perfected in the Philippines when Basso accepted the
terms and conditions of his employment as offered by CMI.
The place of performance relative to Basso's contractual duties
was in the Philippines. The alleged prohibited acts of Basso
11
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
that warranted his dismissal were committed in the
Philippines.
Clearly, the Philippines is the state with the most significant
relationship to the problem. Thus, we hold that CMI and Basso
intended Philippine law to govern, notwithstanding some
references made to US laws and the fact that this intention was
not expressly stated in the contract.
Moreover, foreign law should not be applied when its
application would work undeniable injustice to the citizens or
residents of the forum. To give justice is the most important
function of law; hence, a law, or judgment or contract that is
obviously unjust negates the fundamental principles of
Conflict of Laws.
Termination-at-will is anathema to the public policies on labor
protection espoused by our laws and Constitution, which
dictates that no worker shall be dismissed except for just and
authorized causes provided by law and after due process
having been complied with. Hence, the US Railway Labor Act,
which sanctions termination-at-will, should not be applied in
this case.
Additionally, the rule is that there is no judicial notice of any
foreign law. As any other fact, it must be alleged and proved.If
the foreign law is not properly pleaded or proved, the
presumption of identity or similarity of the foreign law to our
own laws, otherwise known as processual presumption,
applies. Here, US law may have been properly pleaded but it
was not proved in the labor tribunals.
WHEREFORE, Petitioner Continental Micronesia, Inc. is hereby
ordered to pay Respondent Joseph Basso's heirs: 1) separation
pay equivalent to one (1) month pay for every year of service,
and 2) full backwages from January 31, 1996, the date of his
illegal dismissal, to October 2, 2002, the date of his compulsory
retirement age.
a. Proof of Foreign Law
CASES:
WILLAMETTE IRON & STEEL WORKS VS. A.H. MUZZAL
G.R. No. L-42538 May 21, 1935
FACTS:
This case involves the liability of the defendant, a former
resident of the State of California, now residing in the
Philippine Islands, for obligations contracted by a California
corporation of which he was a stockholder at the time said
obligations were contracted with the plaintiff-appellee
Willamette Iron and Steel Works in this case.
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
The section of the Civil Code of California under which the
plaintiff seeks to recover reads:
SEC. 322. Each stockholder of a corporation is individually and
personally liable for such proportion of all its debts and
liabilities contracted or incurred during the time he was a
stockholder as the amount of stock or shares owned by him
bears to the whole of the subscribed capital stock or shares of
the corporation. Any creditor of the corporation may institute
joint or several actions against any of its stockholders, for the
proportion of his claim payable by each, and in such action the
court must (1) ascertain the proportion of the claim or debt for
which each defendant is liable, and (2) a several judgment
must be rendered against each, in conformity therewith. If any
stockholder pays his proportion of any debt due from the
corporation, incurred while he was such stockholder, he is
relieved from any further personal liability for such debt, and
if an action has been brought against him upon such debt, it
must be dismissed, as to him, upon his paying the costs, or
such proportion thereof as may be properly chargeable against
him. The liability of each stockholder is determined by the
amount of stock or shares owned by him at the time the debt
or liability was incurred; and such liability is not released by
any subsequent transfer of stock.
ISSUE:
Whether or not the Californian Law applies to herein
respondent Muzzal.
RULING:
Yes. Muzzal cannot now escape liability by alleging that the
California law is unjust and different from the inconsistent with
the Philippine Corporation Law.
It has been sufficiently established that the defendant was the
owner of 1,433 shares of stock of the corporation Meyer-
Muzzal Company when it contracted the obligations alleged in
the complaint.
Mr. Arthur W. Bolton, an attorney-at-law of San Francisco,
California, since the year 1918, under oath, quoted verbatim
section 322 of the California Civil Code and stated that said
section was in force at the time the obligations of the
defendant to the plaintiff were incurred, i. e., on November 5,
1928 and December 22, 1928. This evidence sufficiently
established the fact that the section in question was the law of
the State of California on the above dates. A reading of
sections 300 and 301 of our Code of Civil Procedure will
convince one that these sections do not exclude the
presentation of other competent evidence to prove the
existence of a foreign law.
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4

"The foreign law is a matter of fact ... You ask the witness what
the law is; he may from his recollection, or on producing and
referring to books, say what it is." (Lord Campbell concurring
in an opinion of Lord Chief Justice Denman in a well known
English case where a witness was called upon to prove the
Roman laws of marriage and was permitted to testify, though
he referred to a book containing the decrees of the Council of
Trent as controlling, Jones on Evidence, Second Edition,
Volume 4, pages 3148-3152.) Aside from the testimony of
Attorney Bolton Ragland's Annotated Civil Code of California
was presented as evidence. This book contains that State's Civil
Code as adopted March 21, 1872, with the subsequent official
statute amendments to and including the year 1929.
The appellant argues that since the law of California, as to the
liability of stockholders of a corporation, is different from and
inconsistent with the Philippine Corporation Law the courts
here should not impose liability provided in that law upon a
resident of these Islands who is a stockholder of a California
corporation.
The herein defendant is chargeable with notice of the law of
California as to the liability of stockholders for debt of a
corporation proportionate to their stock holdings, in view of
the fact that he was one of the incorporators of the Meyer-
Muzzal Company in the year 1924 and was still a stockholder
in that company in the year 1928.
Exhibit 10 of the plaintiff is a certified company of the articles
of incorporation of Meyer-Muzzal Company in which it
appears that that company was incorporated on August 22,
1924, and that the incorporators were A.H. Muzzal, Leo W.
Meyer and James Rolph, Jr., "all of whom are residents and
citizens of the State of California."
CIR vs. FISHER
G.R. No. L-11622 January 28, 1961
FACTS:
Walter G. Stevenson (born in the Philippines on August 9, 1874
of British parents and married in the City of Manila on January
23, 1909 to Beatrice Mauricia Stevenson another British
subject) died on February 22, 1951 in San Francisco, California,
U.S.A. whereto he and his wife moved and established their
permanent residence since May 10, 1945. In his will executed
in San Francisco on May 22, 1947, and which was duly
probated in the Superior Court of California on April 11, 1951,
Stevenson instituted his wife Beatrice as his sole heiress to the
following real and personal properties acquired by the spouses
while residing in the Philippines:
Gross Estate
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
Real Property — 2 parcels of land in Baguio, covered by T.C.T.
Nos. 378 and 379
P43,500.00
Personal Property
(1) 177 shares of stock of Canacao Estate at P10.00 each
1,770.00
(2) 210,000 shares of stock of Mindanao Mother Lode Mines,
Inc. at P0.38 per share
79,800.00
(3) Cash credit with Canacao Estate Inc.
4,870.88
(4) Cash, with the Chartered Bank of India, Australia & China
851.97
Total Gross Assets
P130,792.85
Ian Murray Statt, the appointed ancillary administrator of his
estate filed an estate and inheritance tax return. He made a
preliminary return to secure the waiver of the CIR on the
inheritance of the Mines shares of stock. In 1952, Beatrice
assigned all her rights and interests in the estate to the spouses
Fisher.
On September 7, 1953, the Statt filed a second amended
estate and inheritance tax return which contained new claims
for additional exemption and deduction to wit: (1) deduction
in the amount of P4,000.00 from the gross estate of the
decedent as provided for in Section 861 (4) of the U.S. Federal
Internal Revenue Code which the ancillary administrator
averred was allowable by way of the reciprocity granted by
Section 122 of the National Internal Revenue Code, as then
held by the Board of Tax Appeals in case No. 71 entitled
"Housman vs. Collector," August 14, 1952; and (2) exemption
from the imposition of estate and inheritance taxes on the
210,000 shares of stock in the Mindanao Mother Lode Mines,
Inc. also pursuant to the reciprocity proviso of Section 122 of
the National Internal Revenue Code. In this last return, the
estate claimed that it was liable only for the amount of P525.34
for estate tax and P238.06 for inheritance tax and that, as a
consequence, it had overpaid the government. The refund of
the amount of P15,259.83, allegedly overpaid, was accordingly
requested by the estate.
The Collector denied the claim. An action was commenced in
the CFI of Manila, which held that (a) the ½ share of Beatrice
should be deducted from the net estate of Walter, (b) the
intangible personal property belonging to the estate of Walter
is exempt from inheritance tax pursuant to the reciprocity
proviso in NIRC.
ISSUE:
Whether or not the estate can avail itself of the reciprocity
proviso in the NIRC granting exemption from the payment of
taxes for the Mines shares of stock.
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4

RULING:
NO. Reciprocity must be total. If any of the two states collects
or imposes or does not exempt any transfer, death, legacy or
succession tax of any character, the reciprocity does not work.
In the Philippines, upon the death of any citizen or resident, or
nonresident with properties, there are imposed upon his
estate, both an estate and an inheritance tax. But, under the
laws of California, only inheritance tax is imposed. Also,
although the Federal Internal Revenue Code imposes an estate
tax, it does not grant exemption on the basis of reciprocity.
Thus, a Filipino citizen shall always be at a disadvantage. This
is not what the legislators intended. Specifically: Section122 of
the NIRC provides that “No tax shall be collected under this
Title in respect of intangible personal property (a) if the
decedent at the time of his death was a resident of a foreign
country which at the time of his death did not impose a
transfer of tax or death tax of any character in respect of
intangible personal property of citizens of the Philippines not
residing in that foreign country, or (b) if the laws of the foreign
country of which the decedent was a resident at the time of
his death allow a similar exemption from transfer taxes or
death taxes of every character in respect of intangible personal
property owned by citizens of the Philippines not residing in
that foreign country."
On the other hand, Section 13851 of the California Inheritance
Tax Law provides that intangible personal property is exempt
from tax if the decedent at the time of his death was a resident
of a territory or another State of the United States or of a
foreign state or country which then imposed a legacy,
succession, or death tax in respect to intangible personal
property of its own residents, but either:. Did not impose a
legacy, succession, or death tax of any character in respect to
intangible personal property of residents of this State, or Had
in its laws a reciprocal provision under which intangible
personal property of a non-resident was exempt from legacy,
succession, or death taxes of every character if the Territory or
other State of the United States or foreign state or country in
which the nonresident resided allowed a similar exemption in
respect to intangible personal property of residents of the
Territory or State of the United States or foreign state or
country of residence of the decedent."
PCIB vs JUDGE VENICIO ESCOLIN
G.R. Nos. L-27860 and L-27896 March 29, 1974
FACTS:
Linnie Jane Hodges, an American citizen from Texas, died in
Iloilo City leaving a will executed on November 22, 1952.
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
In her will, she left all her estate in favor of Charles Newton
Hodges, her husband. She also stated in her will that should
Charles later die, the said estate shall be turned over to her
brother and sister.
Charles died while domiciled here. The lawyer of Charles filed
a motion before the probate court while there was an ongoing
probate on the will of Linnie so that a certain Avelina Magno
may be appointed as the administratrix of the estate. Magno
was the most trusted employee of the Hodges when they were
alive and who had been employed for around thirty (30) years.
It was manifested that Charles himself left a will but the same
was in an iron trunk in Charles’ office. The judge approved the
appointment of Magno as administratrix.
Charles’ will was found and so a new petition for probate was
filed for the said will. Magno opposed the said petition. The
probate of Charles’ will was granted. The Philippine
Commercial and Industrial Bank was appointed the
administrator. Magno refused to turn over the estate.
Magno arugued that in her will, Linnie wanted Charles to turn
over the property to Linnie’s brother and sister. Magno also
contended that Linnie was a Texan at the time of her death and
that under Article 16 of the Civil Code, successional rights are
governed by Linnie’s national law. Under the Texas law,
Linnie’s will shall be respected regardless of the presence of
legitimes.
PCIB applied the renvoi doctrine – the law of Texas refers the
matter back to Philippine laws because Linnie was domiciled
outside Texas at the time of her death.
ISSUE:
Does Texan law apply in the instant case?
RULING:
NO. The Supreme Court held, that the estate of Mrs. Hodges
inherited by her brothers and sisters could be more than just
stated, but this would depend on (1) whether upon the proper
application of the principle of renvoi in relation to Article 16 of
the Civil Code and the pertinent laws of Texas, it will appear
that Hodges had no legitime as contended by Magno, and (2)
whether or not it can be held that Hodges had legally and
effectively renounced his inheritance from his wife. Under the
circumstances presently obtaining and in the state of the
record of these cases, as of now, the Court is not in a position
to make a final ruling, whether of fact or of law, on any of these
two issues, and We, therefore, reserve said issues for further
proceedings and resolution in the first instance by the court a
quo, as hereinabove indicated. The Court reiterate, however,
that pending such further proceedings, as matters stand at this
stage, The Court considered opinion is that it is beyond cavil
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
that since, under the terms of the will of Mrs. Hodges, her
husband could not have anyway legally adjudicated or caused
to be adjudicated to himself her whole share of their conjugal
partnership, albeit he could have disposed any part thereof
during his lifetime, the resulting estate of Mrs. Hodges, of
which Magno is the uncontested administratrix, cannot be less
than one-fourth of the conjugal partnership properties, as of
the time of her death, minus what, as explained earlier, have
been gratuitously disposed of therefrom, by Hodges in favor of
third persons since then, for even if it were assumed that, as
contended by PCIB, under Article 16 of the Civil Code and
applying renvoi the laws of the Philippines are the ones
ultimately applicable, such one-fourth share would be her free
disposable portion, taking into account already the legitime of
her husband under Article 900 of the Civil Code.
LAUREANO V. CA
G.R. No. 114776 February 2, 2000
FACTS:
Laureano, Director of Flight Operations and Chief Pilot of Air
Manila, applied for employment with Singapore Airlines
[herein private respondent] through its Area Manager in
Manila. He was then accepted. Sometime in 1982, Singapore
Airline, hit by a recession, initiated cost-cutting measures.
Seventeen (17) expatriate captains in the Airbus fleet were
found in excess of the defendant's requirement. Consequently,
defendant informed its expatriate pilots including plaintiff of
the situation and advised them to take advance leaves.
Realizing that the recession would not be for a short time,
defendant decided to terminate its excess. It did not, however,
immediately terminate it's A-300 pilots. It reviewed their
qualifications for possible promotion to the B-747 fleet.
Among the 17 excess Airbus pilots reviewed, twelve were
found qualified. Unfortunately, Laureano was not one of the
twelve.
Laureano instituted a case for illegal dismissal before the Labor
Arbiter. Singapore Airline moved to dismiss on jurisdictional
grounds. Before said motion was resolved, the complaint was
withdrawn. Thereafter, Laureano filed the instant case for
damages due to illegal termination of contract of services
before the RTC.
CA reversed the decision of the RTC, it held that the action has
already prescribe, the prescriptive period was 4 years and
action was filed beyond the prescriptive period.
ISSUES:
(a) W/N Philippine law must be applied and not Singaporean
law.
(b) W/N action has already prescribe.
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
RULING:
(a) Philippine law must be applied. SC quoted the findings of
the RTC, it says: "Neither can the Court determine whether the
termination of the plaintiff is legal under the Singapore Laws
because of the defendant's failure to show which specific laws
of Singapore Laws apply to this case. As substantially discussed
in the preceding paragraphs, the Philippine Courts do not take
judicial notice of the laws of Singapore. The defendant that
claims the applicability of the Singapore Laws to this case has
the burden of proof. The defendant has failed to do so.
Therefore, the Philippine law should be applied." Also
Respondent Court of Appeals acquired jurisdiction when
defendant filed its appeal before said court. On this matter,
respondent court was correct when it barred defendant-
appellant below from raising further the issue of jurisdiction.
(b) YES. Neither Article 1144 nor Article 1146 of the Civil Code
is here pertinent. What is applicable is Article 291 of the Labor
Code. n the light of Article 291, aforecited, we agree with the
appellate court's conclusion that petitioner's action for
damages due to illegal termination filed again on January 8,
1987 or more than four (4) years after the effective date of his
dismissal on November 1, 1982 has already prescribed. Where
the money claim was based on a written contract, the
Collective Bargaining Agreement, the Court held that the
language of Art. 291 of the Labor Code does not limit its
application only to 'money claims specifically recoverable
under said Code' but covers all money claims arising from an
employee-employer relations"
YAO KEE, SZE SOOK WAH, SZE LAI CHO, and SY CHUN YEN
vs. AIDA SY-GONZALES
G.R. No. L-55960 November 24, 1988
FACTS:
Sy Kiat, a Chinese national, died on January 17, 1977 in
Caloocan City where he was then residing, leaving behind real
and personal properties here in the Philippines worth
P300,000.00 more or less.
Thereafter, Aida Sy-Gonzales, Manuel Sy, Teresita Sy-Bernabe
and Rodolfo Sy filed a petition alleging among others that:
a) They are the children of the deceased with Asuncion Gillego;
b) To their knowledge Sy Kiat died intestate;
c) They do not recognize Sy Kiat’s marriage to Yao Kee nor the
filiation of her children to him; and
d) They nominate Aida Sy-Gonzales for appointment as
administratriz of the intestate estate of the deceased.
The petition was opposed by Yao Kee, Sze Sook Wah, Sze Lai
Cho and Sy Yun Chen who alleged that:
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4

a) Yao Kee is the lawful wife of Sy Kiat who he married on
January 19, 1931 in China;
b) The other oppositors are the legitimate children of the
deceased Yao Kee; and
c) Sze Sook Wah is the eldest among them and is competent,
willing and desirous to become the administratrix of the estate
of Sy Kiat
Yao Kee testified that she was married to Sy Kiat on January
19, 1931 in Fookien, China; that she does not have a marriage
certificate because the practice during that time was for elders
to agree upon the bethrotal of their children, and in her case,
her elder brother was the one who contracted or entered into
an agreement with the parents of her husband; that she and
her husband have been living in Fookien, China before he went
to the Philippines; that in China, the custom is that there is a
go-between, a sort of marriage broker who is known to both
parties who would talk to the parents of the bride-to-beagree
to have the groom-to-be their son-in-law, then they agree on
a date as an engagement day; that on the wedding day, the
document would be signed by the parents of both parties but
there is no solemnizing officer as is known in the Philippines;
that the parties do not signthe document themselves; and that
she and Sy Kiat were married for 46 years already and the
document was left in China and she doubt if that document
can still be found now.
The testimony of Gan Ching, the younger brother of Yao Kee,
that he attended the marriage of his sister with Sy Kiat and that
no marriage certificate is issued by the Chinese government, a
document signed by the parents and elders of the parties being
sufficient. Statements were made by Asuncion Gillego when
she testified that a) Sy Kiat was married to Yao Kee according
to a Chinese custom.
ISSUE:
Whether or not Sy Kiat’s marriage to Yao Kee in accordance
with Chinese Law and Custom conclusive.
RULING:
NO. Petitioners anchored their petition on the following:
First, the testimonies of Yao Kee, Gan Ching, and Asuncion
Gillego;
Second, Sy Kiat's Master Card of Registered Alien issued in
Caloocan City, as well as her Alien Certificate of Registration
issued in Manila stated that her marital status is “Married”;
and
Third, the certification issued in Manila on October 28, 1977 by
the Embassy of the People's Republic of China to the effect
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
that "according to the information available at the Embassy
Mr. Sy Kiat a Chinese national and Mrs. Yao Kee alias Yui Yip
also Chinese were married on January 19, 1931 in Fukien, the
People's Republic of China".
These evidence may very well prove the fact of marriage
between Yao Kee and Sy Kiat. However, the same do not
suffice to establish the validity of said marriage in accordance
with Chinese law or custom.
The law requires that a custom must be proved as a fact,
according to the rules of evidence. A local custom as a source
of right cannot be considered by a court of justice unless such
custom is properly established by competent evidence like any
other fact.
Article 71 of the Civil Code states that: “All marriages
performed outside the Philippines in accordance with the laws
in force in the country where they were performed, and valid
there as such, shall also be valid in this country, except
bigamous, polygamous or incestuous marriages as determined
by Philippine law.
The testimonies of Yao Kee and Gan Ching cannot be
considered as proof of China’s law or custom on marriage not
only because they are self-serving evidence, but more
importantly, there is no showing that they are competent to
testify on the subject matter. The marriage of Yao Kee and Sy
Kiat cannot be recognized in this jurisdiction. Philippine courts
cannot take judicial notice of foreign laws. They must be
alleged and proved as any other fact.
As petitioners failed to establish the marriage of Yao Kee with
Sy Kiat according to the laws of China, they cannot be accorded
the status of legitimate children but only of acknowledged
natural children.
WILDVALLEY SHIPPING CO. V. CA
G.R. NO. 119602 OCTOBER 6, 2000
FACTS:
Philippine Roxas is a vessel owned by Philippine President
Lines, Inc. It arrived in Puerto Ordaz, Republic of Venezuela to
load iron ore. After completion of the loading and unloading,
it was ready to leave the port. Mr. Ezzar del Valle Solarzano
Vasquez, an official pilot of Venezuela, was designated to pilot
the vessel through Orinoco River.
They navigated the river when it experienced some vibrations
because the channel was so shallow. The pilot proceeded but
when it happened again, the ship ran aground causing it to
obstruct the access of other vessels.
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
Malandrinon, a vessel owned by Wildvalley was unable to sail
that day. Subsequently, filed a suit in the RTC of Manila against
Philippine President Lines, Inc. for damages of unearned
profits plus interests. RTC rendered its judgment in favor of
Wildvalley. The CA reversed RTC’s decision.
ISSUE:
Was the foreign law properly proved under the Rules of Court?
HELD:
NO. There were two documents presented as evidence 1.The
Reglamento General de la Ley de Pilotaje(pilotage law of
Venezuela) and 2. Reglamento Para la Zona de Pilotaje N1 del
Orinoco (rules governing the navigation of the Orinoco River).
These written laws were not proven in the manner provided
by Section 24 of Rule 132 of the Rules of Court. The
Reglamento General de la Ley de Pilotaje was published in the
Gaceta Oficial of the Republic of Venezuela. A photocopy of
the Gaceta Oficial was presented in evidence as an official
publication of the Republic of Venezuela. The Reglamento
Para la Zona de Pilotaje N1 del Orinoco is published in a book
issued by the Ministerio de Comunicaciones of Venezuela. Only
a photocopy of the said rules was likewise presented as
evidence.
For a copy of a foreign public document to be admissible, the
following requisites are mandatory: (1) It must be attested by
the officer having legal custody of the records or by his deputy;
and (2) It must be accompanied by a certificate by a secretary
of the embassy or legation, consul general, consul, vice
consular or consular agent or foreign service officer, and with
the seal of his office. The latter requirement is not a mere
technicality but is intended to justify the giving of full faith and
credit to the genuineness of a document in a foreign country.
It is not enough that the Gaceta Oficial, or a book published by
the Ministerio de Comunicaciones of Venezuela, was
presented as evidence with Captain Monzon attesting it. It is
also required by Section 24 of Rule 132 of the Rules of Court
that a certificate that Captain Monzon, who attested the
documents, is the officer who had legal custody of those
records made by a secretary of the embassy or legation, consul
general, consul, vice consul or consular agent or by any officer
in the foreign service of the Philippines stationed in Venezuela,
and authenticated by the seal of his office accompanying the
copy of the public document. No such certificate could be
found in the records of the case.
IN RE: TESTATE ESTATE OF THE DECEASED JOSE B. SUNTAY;
SILVINO SUNTAY vs. IN RE: INTESTATE ESTATE OF THE
DECEASED JOSE B. SUNTAY; FEDERICO C. SUNTAY
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
G.R. Nos. L-3087 and L-3088 July 31, 1954
FACTS:
In 1934, Jose B. Suntay, a Filipino citizen and a resident of the
Philippines, died in Amoy, China. He left real and personal
properties in the Philippines and a house in Amoy. During his
lifetime, he married twice, the first wife was Manuela Cruz,
with whom he had several children. The second marriage was
with Maria Natividad Lim Brillian, with whom he had a son,
Silvino Suntay.
Intestate proceedings were instituted by the heirs from the
first marriage. While the second wife, the surviving widow who
remained in Amoy China, filed a petition for the probate of the
last will and testament of the deceased which was claimed to
have been executed and signed in the Philippines on
November, 1929. The petition was denied due to the loss of
the will before the hearing thereof. After the war, Silvino filed
a petition in the intestate proceedings praying for the probate
of the will executed in the Philippines in November 1929 or of
the will executed in Amoy, China in January 1931. He claimed
that he had found among the files, records and documents of
his late father, a will and testament in Chinese characters
executed and signed by the deceased in January 1931, and that
the same was filed, recorded, and probated in the Amoy
District Court in China. The CFI disallowed the alleged last will
and testament executed in November 1929 and the alleged
last will and testament executed in Amoy, China.
ISSUE:
May the will executed in Amoy, China still be validly probated
in the Philippines?
RULING:
No. it should not be allowed because certain facts as to the due
execution of the China Will were not established. Sections 1, 2,
and 3 of Rule 78 provide that wills proved and allowed in a
foreign country according to the laws of such country maybe
allowed, filed, and recorded by the proper CFI in the
Philippines provided that a copy of such will and the allowance
thereof be duly authenticated and filed with a petition for
allowance in the Philippines in the court having jurisdiction.
Such court shall fix a time and place for the hearing and cause
notice thereof to be given. If it appears at the hearing that the
will should be allowed in the Philippines, the court shall so
allow it, and a certificate of its allowance, signed by the judge
and attested by the seal of the court, to which shall be
attached a copy of the will, shall be filed and recorded by the
clerk. Thus, the will shall have the same effect as if originally
proved and allowed in such court.
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
In the case at bar, the fact that the court in Amoy, China is a
probate court must be proved. The law in China on the
procedure for the allowance of wills must also be proved. The
legal requirements for the execution of a valid will in China in
1931 must also be established by competent evidence. The
case does not present proof on these points. Hence, the last
will and testament executed in Amoy, China should not be
allowed in Philippine jurisdiction.
Moreover, it appears that all the proceedings had in the
municipal district court of Amoy were for the purpose of taking
the testimony of two attesting witnesses to the will and that
the order of the municipal district court of Amoy does not
purport to probate the will. The order of the municipal district
court of Amoy, China does not purport to probate or allow the
will which was the subject of the proceedings. In view thereof,
the will and the alleged probate thereof cannot be said to have
been done in accordance with the accepted basic and
fundamental concepts and principles followed in the probate
and allowance of wills. In the absence of proof that the
municipal district court of Amoy is a probate court and on the
Chinese law of procedure in probate matters, it may be
presumed that the proceedings in the matter of probating or
allowing a will in the Chinese courts are the a deposition or to
a perpetuation of testimony, and even if it were so it does not
measure same as those provided for in our laws on the subject.
It is a proceedings in rem and for the validity of such
proceedings personal notice or by publication or both to all
interested parties must be made.
The interested parties in the case were known to reside in the
Philippines. The evidence shows that no such notice was
received by the interested parties residing in the Philippines.
The proceedings had in the municipal district court of Amoy,
China, may be likened to or come up to the standard of such
proceedings in the Philippines for lack of notice to all
interested parties and the proceedings were held at the back
of such interested parties.
In view thereof, the will and the alleged probate thereof
cannot be said to have been done in accordance with the
accepted basic and fundamental concepts and principles
followed in the probate and allowance of wills. Consequently,
the authenticated transcript of proceedings held in the
municipal district court of Amoy, China, cannot be deemed and
accepted as proceedings leading to the probate or allowance
of a will and, therefore, the will referred to therein cannot be
allowed, filed and recorded by a competent court of this
country.
DUMEZ COMPANY and TRANS-ORIENT ENGINEERS, INC. v.
NATIONAL LABOR RELATIONS COMMISSION and VERONICO
EBILANE
G.R. No. 74495. July 11, 1996
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
FACTS:
Dumez Company, a French company, through Trans-Orient
Engineers, Inc., a corporation organized and existing under the
laws of the Philippines, engaged the services of Veronico
Ebilane as carpenter for one of its projects in the Middle East.
While at the job site, Ebilane was suddenly seized by
abdominal pain and rushed to the hospital were
appendectomy was performed on him. During his
confinement, he developed right-sided weakness and
numbness and difficulty of speaking.
For that reason, Dumez Company formally terminated
Ebilane’s employment and paid his salaries under his
employment contract and thereafter was repatriated to
Manila.
Ebilane then filed a complaint for illegal dismissal against
Dumez Company and Trans-Orient with the Workers’
Assistance and Adjudication Office of the POEA.
The POEA Administrator rendered a decision ordering Dumez
Company and Trans-Orient to pay Ebilane’s medical
compensation benefits equal to 75% of his salaries for four (4)
months.
Dumez Company and Trans-Orient appealed to the NLRC
which affirmed in toto the assailed decision.
Meanwhile, the Solicitor General filed a Comment. The
Solicitor General does not dispute Ebilane’s entitlement, under
Saudi Arabia law, to medical benefits corresponding to the
period of his physical incapacity. It is his position, however,
that while payment of said medical benefits is explicitly
mandated by the Social Insurance Law of Saudi Arabia.
Significantly, neither of the parties has filed any pleading to
refute the postulate of the Solicitor General.
ISSUE:
Is there a legal basis to require Dumez Company and Trans-
Orient to pay Ebilane’s medical compensation?
HELD:
There is none. The POEA Administrator, in finding Dumez
Company and Trans-Orient liable to Ebilane for medical
benefits accruing to the latter under the Social Insurance Law
of Saudi Arabia, took judicial notice of the said law.
To this extent, the POEA Administrator’s actuations are legally
defensible. We have earlier ruled in Norse Management Co.
18
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
(PTE) v. National Seamen Board that evidence is usually a
matter of procedure of which a mere quasi-judicial body is not
strict about. Although in a long line of cases, we have ruled that
a foreign law, being a matter of evidence must be alleged and
proved, in order to be recognized and applied in a particular
controversy involving conflicts of laws, jurisprudence on this
matter was not meant to apply to cases before administrative
or quasi-judicial bodies in the light of the well-settled rule that
administrative and quasi-judicial bodies are not bound strictly
by technical rules. Nonetheless, only to this extent were the
acts of the POEA Administrator amply supported by the law.
POEA Administrator’s actual application thereof, however, is
starkly erroneous.
Section 6(a) of the Overseas Employment Agreement entered
into and signed by the private parties herein, provides that
"Workmen’s Compensation insurance benefits will be provided
within the limits of the compensation law of the host country."
That compensation for disability was to be provided in
accordance with the law of the host country, Saudi Arabia, is a
necessary consequence of the compulsory coverage under the
General Organization for Social Insurance Law of Saudi Arabia
(hereafter, "GOSI Law of Saudi Arabia"), upon all workers,
regardless of nationality, sex or age, who render their services
within the territory of Saudi Arabia by virtue of a labor
contract.
Article 49 of the GOSI Law of Saudi Arabia provides that the
General Organization to pay to the beneficiaries the insurance
compensation, the employer being under no obligation to pay
any allowance to the insured or to his heirs unless the injury
has been intentionally caused by the employer or the injury has
occurred by reason of the latter’s gross error or failure to abide
by the GOSI Law or the rules relating to occupational health
and safety.
Under the GOSI Law of Saudi Arabia as pleaded by Dumez
Company and Trans-Orient clearly the obligation to pay
medical benefits as compensation for work-related injury or
illness, devolves upon the General Organization and not upon
Dumez Company and Trans-Orient. Furthermore, after taking
judicial notice of the GOSI Law of Saudi Arabia, the POEA
Administrator considered the said law as one of a similar
nature as that of our own compensation laws.
Thus, in awarding the medical benefits to Ebilane, she
rationalized the same by quoting Article 166 of the Labor Code
of the Philippines which provides that "the State shall promote
and develop a tax-exempt employees’ compensation program
whereby employees . . . in the event of work-connected
disability or death, may promptly secure adequate income
benefit and medical or related benefits."
Indeed, we may postulate further that the policies underlying
our compensation laws and the GOSI Law of Saudi Arabia being
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
similar, the nature thereof could not be so dissimilar. Suffice it
to say that our own compensation program imposes on the
employer nothing more than the obligation to remit monthly
premiums to the State Insurance Fund and it is the latter, not
the employer, on which is laid the burden of compensating the
employee for any disability; in fact, once the employer pays his
share to the fund, all obligation on his part to his employees is
ended. No showing at all has there been that Dumez Company
and Trans-Orient had failed to comply with its obligations as
employer under the GOSI Law of Saudi Arabia.
ASIAVEST LIMITED vs. THE COURT OF APPEALS AND
ANTONIO HERAS
G.R. No. 128803, September 25, 1998
FACTS:
Asiavest Limited filed a complaint against the defendant
Antonio Heras praying that said defendant be ordered to pa
the pay the amounts awarded by the Hong Kong Court
Judgment to wit:
1) US$1,810,265.40 or its equivalent in Hong Kong currency at
the time of payment with legal interest from December 28,
1984 until fully paid;
2) interest on the sum of US$1,500.00 at 9.875% per annum
from October 31, 1984 to December 28, 1984; and
3) HK$905.00 at fixed cost in the action; and
4) at least $80,000.00 representing attorneys fees, litigation
expenses and cost, with interest thereon from the date of the
judgment until fully paid.
At the pre-trial conference, the parties could not arrive at any
settlement. However, they agreed on the following
stipulations of facts:
1) The defendant admits the existence of the judgment dated
December 28, 1984 as well as its amendment dated April 13,
1987, but not necessarily the authenticity or validity thereof;
2) The plaintiff is not doing business and is not licensed to do
business in the Philippines;
3) The residence of defendant, Antonio Heras, is New Manila,
Quezon City.
The plaintiff presented only documentary evidence to show
rendition, existence, and authentication of such judgment by
the proper officials concerned. In addition, the plaintiff
presented testimonial and documentary evidence to show its
entitlement to attorney’s fees and other expenses of litigation.
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4

On the other hand, the defendant presented two witnesses,
namely, Fortunata dela Vega and Russel Warren Lousich.
The gist of Ms. dela Vegas testimony is to the effect that no
writ of summons or copy of a statement of claim of Asiavest
Limited was ever served in the office of the Navegante
Shipping Agency Limited and/or for Mr. Antonio Heras, and
that no service of the writ of summons was either served on
the defendant at his residence in New Manila, Quezon City.
Mr. Lousich was presented as an expert on the laws of Hong
Kong, and as a representative of the law office of the
defendant’s counsel who made a verification of the record of
the case filed by the plaintiff in Hong Kong against the
defendant, as well as the procedure in serving Court processes
in Hong Kong.
In his affidavit, the said witness stated that: The defendant was
sued on the basis of his personal guarantee of the obligations
of Compania Hermanos de Navegacion S.A. There is no record
that a writ of summons was served on the person of the
defendant in Hong Kong, or that any such attempt at service
was made. Likewise, there is no record that a copy of the
judgment of the High Court was furnished or served on the
defendant; anyway, it is not a legal requirement to do so under
Hong Kong laws.
On cross examination, Mr. Lousich stated that before he was
commissioned by the law firm of the defendants counsel as an
expert witness and to verify the records of the Hong Kong case,
he had been acting as counsel for the defendant in a number
of commercial matters; that there was an application for
service of summons upon the defendant outside the
jurisdiction of Hong Kong; that there was an order of the Court
authorizing service upon Heras outside of Hong Kong,
particularly in Manila or any other place in the Philippines (p.
9, TSN, 2/14/90); that there must be adequate proof of service
of summons, otherwise the Hong Kong Court will refuse to
render judgment (p. 10, ibid); that the mere fact that the Hong
Kong Court rendered judgment, it can be presumed that there
was service of summons; that in this case, it is not just a
presumption because there was an affidavit stating that
service was effected in [sic] a particular man here in Manila;
that such affidavit was filed by one Jose R. Fernandez of the
firm Sycip Salazar on the 21st of December 1984, and stated in
essence that on Friday, the 23rd of November 1984 he served
the 4th defendant at No. 6 First Street, Quezon City by leaving
it at that address with Mr. Dionisio Lopez, the son-in-law of the
4th defendant the copy of the writ and Mr. Lopez informed me
and I barely believed that he would bring the said writ to the
attention of the 4th defendant (pp. 11-12, ibid.); that upon
filing of that affidavit, the Court was asked and granted
judgment against the 4th defendant; and that if the summons
or claim is not contested, the claimant of the plaintiff is not
required to present proof of his claim or complaint or present
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
evidence under oath of the claim in order to obtain judgment;
and that such judgment can be enforced in the same manner
as a judgment rendered after full hearing.
Trial Court: The trial court concluded that the Hong Kong court
judgment should be recognized and given effect in this
jurisdiction for failure of HERAS to overcome the legal
presumption in favor of the foreign judgment.
CA: the Court of Appeals rendered its decision reversing the
decision of the trial court and dismissing ASIAVESTs complaint
without prejudice. It underscored the fact that a foreign
judgment does not itself have any extraterritorial application.
For it to be given effect, the foreign tribunal should have
acquired jurisdiction over the person and the subject matter.
If such tribunal has not acquired jurisdiction, its judgment is
void.
ISSUE:
Whether or not the judgment of the Hong Kong Court has
been repelled by evidence of want of jurisdiction, want of
notice to the party, collusion, fraud or clear mistake of law or
fact, such as to overcome the presumption established in
Section 50, Rule 39 of the Rules of Court in favor of foreign
judgments
Whether or not the foreign judgment can be enforced against
Heras in the Philippines (NO)
HELD:
No. Although the foreign judgment was duly authenticated
(Asiavest was able to adduce evidence in support thereto) and
Heras was never able to overcome the validity of it, it cannot
be enforced against Heras here in the Philippines because
Heras was not properly served with summons. Hence, as far as
Philippine law is concerned, the Hong Kong court has never
acquired jurisdiction over Heras. This means then that
Philippine courts cannot act to enforce the said foreign
judgment.
Under paragraph (b) of Section 50, Rule 39 of the Rules of
Court,5 which was the governing law at the time this case was
decided by the trial court and respondent Court of Appeals, a
foreign judgment against a person rendered by a court having
jurisdiction to pronounce the judgment is presumptive
evidence of a right as between the parties and their successors
in interest by the subsequent title. However, the judgment
may be repelled by evidence of want of jurisdiction, want of
notice to the party, collusion, fraud, or clear mistake of law or
fact.
Also, Section 3(n) of Rule 131 of the New Rules of Evidence
provides that in the absence of proof to the contrary, a court,
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
or judge acting as such, whether in the Philippines or
elsewhere, is presumed to have acted in the lawful exercise of
jurisdiction.
Hence, once the authenticity of the foreign judgment is
proved, the burden to repel it on grounds provided for in
paragraph (b) of Section 50, Rule 39 of the Rules of Court is on
the party challenging the foreign judgment—HERAS in this
case.
In this case, since HERAS was not a resident of Hong Kong and
the action against him was, indisputably, one in personam,
summons should have been personally served on him in Hong
Kong. The extraterritorial service in the Philippines was
therefore invalid and did not confer on the Hong Kong court
jurisdiction over his person. It follows that the Hong Kong court
judgment cannot be given force and effect here in the
Philippines for having been rendered without jurisdiction.
Similarly, HERAS, who was also an absentee, should have been
served with summons in the same manner as a nonresident
not found in Hong Kong. Section 17, Rule 14 of the Rules of
Court providing for extraterritorial service will not apply
because the suit against him was in personam. Neither can we
apply Section 18, which allows extraterritorial service on a
resident defendant who is temporarily absent from the
country, because even if HERAS be considered as a resident of
Hong Kong, the undisputed fact remains that he left Hong Kong
not only “temporarily” but “for good.”
ROBERTO S. BENEDICTO VS. CA
G.R. No. 125359 September 4, 2001
FACTS:
On December 7 1991, Mrs. Imelda Marcos, Mr. Roberto
Benedicto and Mr. Hector Rivera were indicted for violation of
Section 10 of Circular No. 960 relation to Section 34 of the
Central Bank Act (Republic Act No. 265, as amended) in five
Informations filed with the Regional Trial Court of Manila. The
charge sheets alleged that the trio failed to submit reports of
their foreign exchange earnings from abroad and/or failed to
register with the Foreign Exchange Department of the Central
Bank within the period mandated by Circular No. 960. Said
Circular prohibited natural and juridical persons from
maintaining foreign exchange accounts abroad without prior
authorization from the Central Bank. It also required all
residents of the Philippines who habitually earned or received
foreign currencies from invisibles, either locally or abroad, to
report such earnings or receipts to the Central Bank.
Violations of the Circular were punishable as a criminal offense
under Section 34 of the Central Bank Act. They moved to quash
the information. Their motion was grounded on lack of
jurisdiction, forum shopping, extinction of criminal liability
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
with the repeal of Circular No. 960, prescription, exemption
from the Central Bank’s reporting requirement, and the grant
of absolute immunity as a result of a compromise agreement
entered into with the government. RTC: denied petitioners’
motion.
A similar motion filed on May 23, 1994 by Mrs. Marcos seeking
to dismiss the dollar-salting cases against her due to the repeal
of Circular No. 960 had earlier been denied by the trial court in
its order dated June 9, 1994. Petitioners then filed a motion for
reconsideration, but the trial court likewise denied this motion
on October 18, 1994. CA: denied the motion to quash.
PETITIONERS: postulate that since the purchases of treasury
notes were done through the Central Bank’s Securities
Servicing Department and payments of the interest were
coursed through its Securities Servicing Department/Foreign
Exchange Department, their filing of reports would be
surplusage, since the requisite information were already with
the Central Bank.
Furthermore, they contend that the foreign currency
investment accounts in the Swiss banks were subject to
absolute confidentiality as provided for by Republic Act No.
6426, as amended by Presidential Decree Nos. 1035, 1246, and
1453, and fell outside the ambit of the reporting requirements
imposed by Circular No. 960. Petitioners further rely on the
exemption from reporting provided for in Section 10(q),
Circular No. 960, and the confidentiality granted to Swiss bank
accounts by the laws of Switzerland.
ISSUE:
Whether Marcos, Benedicto and Rivera can rely on the
exemption from reporting provided for in Section 10(q),
Circular No. 960, and the confidentiality granted to Swiss bank
accounts by the laws of Switzerland.
RULING:
No. Under Section 2 of the Foreign Currency Deposit Act that
said law is inapplicable to the foreign currency accounts in
question. Section 2, Republic Act No. 6426 speaks of "deposit
with such Philippine banks in good standing, as may be
designated by the Central Bank for the purpose." The criminal
cases filed against petitioners for violation of Circular No. 960
involve foreign currency accounts maintained in foreign banks,
not Philippine banks. By invoking the confidentiality
guarantees provided for by Swiss banking laws, petitioners
admit such reports made. The rule is that exceptions are
strictly construed and apply only so far as their language fairly
warrants, with all doubts being resolved in favor of the general
proviso rather than the exception.Hence, petitioners may not
claim exemption under Section 10(q).
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
With respect to the banking laws of Switzerland cited by
petitioners, the rule is that Philippine courts cannot take HELD:
judicial notice of foreign laws. Laws of foreign jurisdictions
must be alleged and proved. Petitioners failed to prove the NO. The Walden Affidavit failed to prove New York law and
Swiss law relied upon, either by: (1) an official publication jurisprudence. The SC denied the Bank’s petition for lack of
thereof; or (2) a copy attested by the officer having the legal merit.
custody of the record, or by his deputy, and accompanied by a
certification from the secretary of the Philippine embassy or The CA considered the New York law and jurisprudence as
legation in such country or by the Philippine consul general, public documents defined in Rule 132 Sec 19 and 24 of the
consul, vice-consul, or consular agent stationed in such Rules of Evidence, which should be followed in proving foreign
country, or by any other authorized officer in the Philippine law.
foreign service assigned to said country that such officer has
custody. Absent such evidence, this Court cannot take judicial SEC. 19. Classes of Documents. – For the purpose of their
cognizance of the foreign law invoked by Benedicto and Rivera. presentation in evidence, documents are either public or
private.
MANUFACTURERS HANOVER TRUST CO. and/or CHEMICAL
BANK, petitioners, vs. RAFAEL MA. GUERRERO Public documents are:
G.R. No. 136804 February 19, 2003 (a) The written official acts, or records of the official acts of the
sovereign authority, official bodies and tribunals, and public
officers, whether of the Philippines, or of a foreign country;
FACTS:
SEC. 24. Proof of official record. – The record of public
On May 17, 1994, Guerrero filed a complaint for damages
documents referred to in paragraph (a) of Section 19, when
against Hanover and/or Chemical Bank (Bank) with the RTC of
admissible for any purpose, may be evidenced by an official
Manila.
publication thereof or by a copy attested by the officer having
the legal custody of the record, or by his deputy, and
Guerrero sought payment of damages for
accompanied, if the record is not kept in the Philippines, with
a certificate that such officer has the custody. If the office in
1. Illegally withheld taxes charged against interests on his
which the record is kept is in a foreign country, the certificate
checking account with the Bank
may be made by a secretary of the embassy or legation, consul
2. A returned check worth $18,000 due to signature
general, consul, vice consul, or consular agent or by any officer
verification problems
in the foreign service of the Philippines stationed in the foreign
3. Unauthorized conversion of his account
country in which the record is kept, and authenticated by the
seal of his office.
The Bank answered that by stipulation, Guerrero’s account is
governed by New York law, and such law does not permit any
The Walden Affidavit Failed to Prove New York Law and
of Guerrero’s claims except actual damages.
Jurisprudence
The Bank filed a Motion for Partial Summary Judgment (PSJ),
The Bank’s motion for PSJ as supported by the Walden
contending that the trial should be limited to the issue of
Affidavit does not demonstrate that Guerrero’s claims are
actual damages only.
sham, fictitious or contrived. On the contrary, the Walden
affidavit shows that the facts and material allegations as
The “Walden Affidavit” was presented by the Bank to support
pleaded by the parties are disputed and there are substantial
its Motion for PSJ.
triable issues necessitating a formal trial.
The RTC and CA denied the Bank’s Motion for PSJ, stating that
Foreign laws are not a matter of judicial notice. Like any other
the Walden Affidavit does not serve as proof of the New York
fact, they must be alleged and proven. Certainly, the
law and jurisprudence relied on by the Bank to support its
conflicting allegations as to whether New York law or
Motion.
Philippine law applies to Guerrero’s claims present a clear
dispute on material allegations which can be resolved only by
ISSUE:
a trial on the merits.
WON the Walden Affidavit was sufficient proof of the New
The Bank, however, cannot rely on Willamette Iron and Steel
York law and jurisprudence relied upon by the Bank in its
Works v. Muzzal or Collector of Internal Revenue v. Fisher to
Motion for PSJ?
support its cause. These cases involved attorneys testifying in

DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN 22
CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
open court during the trial in the Philippines and quoting the
particular foreign laws sought to be established. On the other
hand, the Walden Affidavit was taken abroad ex parte and the
affiant never testified in open court. The Walden Affidavit
cannot be considered as proof of New York law on damages
not only because it is self-serving but also because it does not
state the specific New York law on damages.
The Walden Affidavit states conclusions from the affiant’s
personal interpretation and opinion of the facts of the case vis
a vis the alleged laws and jurisprudence without citing any law
in particular. The citations in the Walden Affidavit of various
U.S. court decisions do not constitute proof of the official
records or decisions of the U.S. courts.
While the Bank attached copies of some of the U.S. court
decisions cited in the Walden affidavit, these copies do not
comply with Section 24 of Rule 132 on proof of official records
or decisions of foreign courts.
The Bank failed to comply with Section 24 of Rule 132 on how
to prove a foreign law and decisions of foreign courts. The
Walden Affidavit did not prove the current state of New York
law and jurisprudence. Thus, the Bank has only alleged, but has
not proved, what New York law and jurisprudence are on the
matters at issue.
It Was Not Mandatory for Guerrero to Submit an Opposing
Affidavit to the Walden Affidavit
Next, the Bank makes much of Guerrero’s failure to submit an
opposing affidavit to the Walden Affidavit. However, the
pertinent provision of Rule 35 Sec 3 of the old Rules of Court
did not make the submission of an opposing affidavit
mandatory. Guerrero need not file an opposing affidavit to the
Walden affidavit because his complaint itself controverts the
matters set forth in the Bank’s motion and the Walden
affidavit. A party should not be made to deny matters already
averred in his complaint.
There being substantial triable issues between the parties, the
courts a quo correctly denied the Bank’s motion for partial
summary judgment. There is a need to determine by
presentation of evidence in a regular trial if the Bank is guilty
of any wrongdoing and if it is liable for damages under the
applicable laws.
CHIQUITA BRANDS, INC. AND CHIQUITA BRANDS
INTERNATIONAL, INC., VS. HON. GEORGE E. OMELIO,
REGIONAL TRIAL COURT, DAVAO CITY, BRANCH 14, SHERIFF
ROBERTO C. ESGUERRA, CECILIO G. ABENION, AND 1,842
OTHER PLAINTIFFS IN CIVIL CASE NO. 95-45
G.R. No. 189102, June 07, 2017
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
FACTS:
On August 31, 1993, thousands of banana plantation workers
from over 14 countrie instituted class suit for damages in the
United States against 11 foreign corporations, namely: (1) Shell
Oil Company; (2) Dow Chemical Company; (3) Occidental
Chemical Corporation; (4) Standard Fruit Company; (5)
Standard Fruit and Steamship Co.; (6) Dole Food Company,
Inc.; (7) Dole Fresh Fruit Company; (8) Chiquita Brands, Inc.; (9)
Chiquita Brands International, Inc.; (10) Del Monte Fresh
Produce, N.A.; and (11) Del Monte Tropical Fruit Co.
The banana plantation workers claimed to have been exposed
to dibromochloropropane (DBCP) in the 1970s up to the 1990s
while working in plantations that utilized it. As a result, these
workers suffered serious and permanent injuries to their
reproductive systems.
The United States courts dismissed the actions on the ground
of forum non conveniens and directed the claimants to file
actions in their respective home countries.
On May 3, 1996, 1,843 Filipino claimants filed a complaint for
damages against the same foreign corporations before the
Regional Trial Court in Panabo City, Davao del Norte,
Philippines.
Before pre-trial, Chiquita Brands, Inc., Chiquita Brands
International, Inc. (collectively, Chiquita), Dow Chemical
Company (Dow), Occidental Chemical Corporation
(Occidental), Shell Oil Company (Shell), Del Monte Fresh
Produce, N.A., and Del Monte Tropical Fruit Co. (collectively,
Del Monte) entered into a worldwide settlement in the United
States with all the banana plantation workers. The parties
executed a document denominated as the "Compromise
Settlement, Indemnity, and Hold Harmless Agreement"
(Compromise Agreement).
The Compromise Agreement also provided that the laws of
Texas, United States should govern its interpretation. Chiquita,
Dow, Occidental, Shell, and Del Monte moved to dismiss Civil
Case No. 95-45.
RTC: approved the Compromise Agreement by way of
judgment on compromise; dismissed Civil Case No. 95-45
Several claimants moved for the execution of the judgment on
compromise. Chiquita, Dow, Occidental, Shell, and Del Monte
opposed the execution on the ground of mootness. They
argued that they had already complied with their obligation
under the Compromise Agreement by depositing the
settlement amounts into an escrow account.
RTC: granted the Motion for Execution because there was no
proof that the settlement amounts had been withdrawn and
delivered to each individual claimant
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4

A writ of execution was issued. Shell, Dow, and Occidental
moved that they be allowed to photocopy, certify, and
authenticate the release documents in the United States
before a court-appointed commissioner or before Judge
Grageda. The release documents, which allegedly proved that
the claims had been settled in full, were stored in the Law
Offices of Baker Botts L.L.P. in Houston, Texas, United States.
RTC: ordered the reception of evidence at the Philippine
Consulate in San Francisco, California, United States and
undertook to preside over the proceedings; suspended the
implementation of the Writ of Execution and deferred action
on the pending motions until the termination of the
proceedings abroad.
The claimants objected to the reception of evidence in the
United States. They argued that Judge Grageda was not
authorized to receive evidence and hold hearings outside his
territorial jurisdiction without this Court's express permission.
Judge Grageda declared the photocopies of the release
documents as "authentic and true copies of the original[s].”
The claimants moved for reconsideration arguing that the
evidence was inadmissible because Judge Grageda was not
authorized "to conduct the proceedings abroad.”
RTC: considered the documents obtained from the
proceedings abroad "as part of the case record."
Insisting that the proceedings in San Francisco, California,
United States were void, the claimants moved to expunge the
documents that were adduced by the defendant corporations.
The claimants also moved for the implementation of the Writ
of Execution.
ISSUES:
1) Whether or not the doctrine of hierarchy of courts was
violated.
2) Whether or not the respondent court committed grave
abuse of discretion amounting to lack or excess of its
jurisdiction.
RULING:
1) No. The doctrine on hierarchy of courts prohibits "parties
from directly resorting to this Court when relief may be
obtained before the lower courts.” This rule is founded upon
judicial economy and practical considerations. On the one
hand, it allows this Court to devote its time and attention to
those matters falling within its exclusive jurisdiction. It also
"prevent[s] the congestion of th[is] Court's dockets.” On the
other hand, it "ensure[s] that every level of the judiciary
performs its designated roles in an effective and efficient
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
manner.” The doctrine on hierarchy of courts was designed to
promote order and efficiency.
Nevertheless, a direct invocation of this Court's original
jurisdiction may be justified "when there are compelling
reasons clearly set forth in the petition.” Immediate resort to
this Court may be warranted:
(1) when genuine issues of constitutionality are raised that
must be addressed immediately; (2) when the case involves
transcendental importance; (3) when the case is novel; (4)
when the constitutional issues raised are better decided by
this Court; (5) when time is of the essence; (6) when the
subject of review involves acts of a constitutional organ; (7)
when there is no other plain, speedy, adequate remedy in the
ordinary course of law; (8) when the petition includes
questions that may affect public welfare, public policy, or
demanded by the broader interest of justice; (9) when the
order complained of was a patent nullity; and (10) when the
appeal was considered as an inappropriate remedy.
We may take cognizance of this case "in the interest of judicial
economy and efficiency.” The records of this case are sufficient
for this Court to decide on the issues raised by the parties. Any
further delay would unduly prejudice the parties.
2) Yes. A compromise is defined under the Civil Code as "a
contract whereby the parties, by making reciprocal
concessions, avoid a litigation or put an end to one already
commenced.” It may either be judicial or extrajudicial
depending on its object or the purpose of the parties. A
compromise is judicial if the parties' purpose is to terminate a
suit already commenced. On the other hand, a compromise is
extrajudicial if its object is to avoid litigation.
In any case, a compromise validly entered into has the
authority and effect of res judicata as between the parties. To
this extent, a judicial compromise and an extrajudicial
compromise are no different from each other.
However, unlike an extrajudicial compromise, a compromise
that has received judicial imprimatur "becomes more than a
mere contract.” A judicial compromise is regarded as a
"determination of the controversy" between the parties and
"has the force and effect of [a final] judgment.” In other words,
it is both a contract and "a judgment on the merits.” It may
neither be disturbed nor set aside except in cases where there
is forgery or when either of the parties' consent has been
vitiated.
The doctrine on immutability of judgments applies to
compromise agreements approved by the courts in the same
manner that it applies to judgments that have been rendered
on the basis of a full-blown trial. Thus, a judgment on
compromise that has attained finality cannot be "modified in
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4
any respect, even if the modification is meant to correct
erroneous conclusions of fact and law, and whether it be made
by the court that rendered it or by the Highest Court of the
land.”
The Writ of Execution ordering the collection of the settlement
amount directly from petitioners and its co-defendants in Civil
Case No. 95-45 is void.
Under the judicially approved Compromise Agreement,
petitioners are obliged to deposit the settlement amount in
escrow within 10 business days after they receive a signed
Compromise Agreement from the counsel of the claimants.
The implementation of the Writ of Execution, is likewise void.
Ordinarily, courts have the ministerial duty to grant the
execution of a final judgment. The prevailing party may
immediately move for execution of the judgment, and the
issuance of the writ follows as a matter of course. Execution,
being "the final stage of litigation ... [cannot] be frustrated."
Nevertheless, the execution of a final judgment may be stayed
or set aside in certain cases. "Courts have jurisdiction to
entertain motions to quash previously issued writs of
execution[.]” They "have the inherent power, for the
advancement of justice, to correct the errors of their
ministerial officers and to control their own processes.”
On the other hand, in resolving whether execution should be
suspended or whether a writ of execution should be quashed,
courts should be guided by the same principle in the execution
of final judgments. Certainly, they may require parties to
present evidence.
In this case, petitioners cannot rely on the five (5) quitclaims
for the trial court to quash or recall the writ of execution. The
quitclaims are insufficient to establish that petitioners
complied with their obligation under the Compromise
Agreement. They only prove that five (5) claimants received
their respective share in the settlement amount but do not
establish that petitioners deposited the entire settlement
amount in escrow. At the very least, petitioners should have
attached proof of actual deposit in their Opposition to the
Motion for Execution.
Neither can petitioners rely on the evidence presented during
the proceedings conducted at the Philippine Consulate in San
Francisco, California, United States. This Court takes judicial
notice of the administrative case filed against Judge Grageda
for his act of receiving evidence abroad without proper
authority.
[N]o matter how noble [Judge Grageda's] intention was, he is
not at liberty to commit acts of judicial indiscretion. The
proceedings conducted by [Judge Grageda] abroad are outside
the territorial jurisdiction of the Philippine Courts. He is the
Presiding Judge of Branch 4 of the Regional Trial Court for the
DIGESTED BY: DAHIROC, ERUM, FUENTES, OLACO, PANIZA, RIVERA, SALVANA, TAN, UNAS, VILLAHERMOSA & VILLARIN
Eleventh Judicial Region, the territorial jurisdiction of which is
limited only to Panabo, Davao del Norte. This Court had not
granted him any authority to conduct the proceedings abroad.
It is not [Judge Grageda's] duty to secure these documents for
the defendants, as he is the judge in the pending case and not
the counsel of the defendants. Judges in their zeal to search
for the truth should not lose the proper judicial perspective,
and should see to it that in the execution of their duties, they
do not overstep the limitations of their power as laid by the
rules of procedure.
However, presiding Judge Grageda inhibited himself from
further hearing the case before the Regional Trial Court,
Panabo City could act on the pending incidents. The case was
then transferred to Davao City due to the hostile environment
in Panabo City. Succeeding events further delayed the
proceedings.
Given the circumstances of this case, petitioners cannot be
faulted for failing to make a formal offer of evidence because
they were denied the opportunity to do so. Respondent court
should have given petitioners the chance to offer the
deposition of Mr. Stubbs in evidence before acting on the
pending incidents of the case. Thus, respondent court gravely
abused its discretion in issuing the Order dated July 10, 2009,
which affirmed execution against petitioners.
Under the Compromise Agreement, the law that shall govern
its interpretation is the law of Texas, United States. In this
jurisdiction, courts are not authorized to "take judicial notice
of foreign laws.” The laws of a foreign country must "be
properly pleaded and proved" as facts. Otherwise, under the
doctrine of processual presumption, foreign law shall be
presumed to be the same as domestic law. Unfortunately,
there is no evidence that Texan law has been proven as a fact.
Hence, this Court is constrained to apply Philippine law.
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CASE DIGESTS ON CONFLICT OF LAWS – WEEK 4