1. G.R. No.
149177, November 23, 2007
FACTS:
Nippon, a Japanese consultancy firm entered
into a one-year ICA contract with Kitamura, a
Japanese national permanently residing in the
Philippines. On February 2000, Kitamura was
informed that Nippon is no longer renewing
his ICA and his services would only be utilized
until March 31, 2000. Aggrieved, Kitamura
now filed an action for specific performance
and damages with the RTC of Lipa City.
Nippon filed a motion to dismiss. The trial and
appellate court ruled in favor of Kitamura,
hence this petition.
ISSUE:
Whether or not the RTC of Lipa City has
jurisdiction for contracts executed by and
between two foreign nationals in foreign
country wholly written in a foreign language?
RULING:
Yes. In the judicial resolution of conflict
problems, 3 consecutive phases are involved:
jurisdiction, choice of law, and recognition and
enforcement of judgments. Jurisdiction and
choice of law are two different concepts.
Jurisdiction considers whether it is fair to
cause a defendant to travel to this state;
choice of law asks the further question
whether the application of a substantive law
which will determine the merits of the case is
fair to both parties. The power to exercise
jurisdiction does not automatically give a state
a constitutional authority to apply forum law.
The only issue is the jurisdiction, hence,
choice of law rules as raised by the petitioner
is inapplicable and not yet called for. The
petitioner prematurely invoked the said rules
before pointing out any conflict between the
laws of Japan and the Philippines.
2. Saudi Arabian Airlines v. CA - Case
Digest
Facts:
Saudi Arabian Airlines (SAUDIA) hired
Milagros Morada as a Flight Attendant for its
airlines based in Jeddah, Saudi Arabia. While
on a lay-over in Jakarta, Morada went to a
disco with fellow crew members Thamer &
Allah, 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. In which Allah left on
some pretext. Thamer attempted to rape
Morada but she was rescued by hotel
personnel when they heard her cries for help.
Indonesian police came and arrested Thamer
and Allah, the latter as an accomplice.
Morada refused to cooperate when SAUDIA’s
Legal Officer and its base manager tried to
negotiate the immediate release of the
detained crew members with Jakarta police.
Through the intercession of Saudi Arabian
government, Thamer and Allah were deported
and, eventually, again put in service by
SAUDIA. But Morada was transferred to
Manila.
One year and a half year later, Morada was
again ordered to see SAUDIA’s Chief Legal
Officer. Instead, she was brought to a Saudi
court where she was asked to sign a blank
document, which turned out to be a notice to
her to appear in court. Monada returned to
Manila.
The next time she was escorted by SAUDIA’s
legal officer to court, the judge rendered a
decision against her sentencing her to five
months imprisonment and to 286 lashes.
Apparently, she was tried by the court which
found her guilty of (1) adultery; (2) going to a
disco, dancing and listening to the music in
violation of Islamic laws; and (3) socializing
with the male crew, in contravention of Islamic
tradition.
After denial by SAUDIA, Morada sought help
from Philippine Embassy during the
appeal. Prince of Makkah dismissed the case
against her. SAUDIA fired her without notice.
Morada filed a complaint for damages against
SAUDIA, with the RTC of QC. SAUDIA filed
Omnibus Motion to Dismiss which raised the
ground that the court has no jurisdiction,
among others which was denied
ISSUE: Whether RTC of QC has jurisdiction
to hear and try the case
HELD: YES. The RTC of QC has jurisdiction
and Philippine law should govern.Its
jurisdiction has basis on Sec. 1 of RA 7691
and Rules of Court on venue. Pragmatic
considerations, including the convenience of
the parties, also weigh heavily in favor of the
RTC QC assuming jurisdiction. Paramount is
the private interest of the litigant. Weighing
the relative claims of the parties, the court a
quo found it best to hear the case in the
Philippines. Had it refused to take cognizance
of the case, it would be forcing Morada to
seek remedial action elsewhere, i.e. in the
Kingdom of Saudi Arabia where she no longer
maintains substantial connections. That would
have caused a fundamental unfairness to her.
By filing a complaint, Morada has voluntarily
submitted to the jurisdiction of the court. By
filing several motions and praying for reliefs
(such as dismissal), SAUDIA has effectively
submitted to the trial court’s jurisdiction.
3. RAYTHEON INTERNATIONAL, INC. vs.
STOCKTON W. ROUZIE, JR.
Principle in Law: Nationality Theory
FACTS:
Brand Marine Services, Inc. (BMSI), a
corporation duly organized and existing under
the laws of the State of Connecticut, United
States of America, and respondent Stockton
W. Rouzie, Jr., an American citizen, entered
into a contract whereby BMSI hired Rouzie as
its representative to negotiate the sale of
services in several government projects in the
Philippines for an agreed remuneration of
10% of the gross receipts.
Rouzie filed before the Arbitration Branch of
the National Labor Relations Commission
(NLRC) a suit against BMSI and Rust
International, Inc. (RUST), for alleged
nonpayment of commissions, illegal
termination and breach of employment
contract.
Labor Arbiter rendered judgment ordering
BMSI and RUST to pay respondent’s money
claims. Upon appeal by BMSI, the NLRC
reversed the decision of the Labor Arbiter and
dismissed respondent’s complaint on the
ground of lack of jurisdiction.
Rouzie, then a resident of La Union, instituted
an action for damages before the Regional
Trial Court (RTC) of Bauang, La Union
against Raytheon. Rouzie essentially
reiterated the allegations in the labor case,
and Rouzie also averred that BMSI and RUST
as well as petitioner itself had combined and
functioned as one company.
In its Answer, Raytheon alleged that contrary
to respondent’s claim, it was a foreign
corporation duly licensed to do business in the
Philippines and denied entering into any
arrangement with respondent or paying the
latter any sum of money. Petitioner also
referred to the NLRC decision which disclosed
that per the written agreement between
respondent and BMSI and RUST,
denominated as "Special Sales
Representative Agreement," the rights and
obligations of the parties shall be governed by
the laws of the State of Connecticut.
Raytheon sought the dismissal of the
complaint on grounds of failure to state a
cause of action and forum non conveniens
and prayed for damages by way of
compulsory counterclaim.
The RTC denied Raytheon’s omnibus motion.
The trial court held that the factual allegations
in the complaint, assuming the same to be
admitted, were sufficient for the trial court to
render a valid judgment thereon. It also ruled
that the principle of forum non conveniens
was inapplicable because the trial court could
enforce judgment on petitioner, it being a
foreign corporation licensed to do business in
the Philippines.
Raytheon sought the dismissal of the
complaint on the grounds of failure to state
acause of action & forum non conveniens &
prayed for damages by way of compulsory
counterclaim. The RTC denied Raytheon’s
motion. The CA affirmed.
Raytheon’s contention:
(a.)The written contract between Rouzie &
BMSI included a valid choice of law clause,
that is, that the contract shall be governed by
the laws of the State of Connecticut.
(b) It also mentions the presence of foreign
elements in the dispute, namely that the
parties & witnesses involved are American
corporations & citizens & the evidence to be
presented is located outside the Philippines,
that renders our local courts inconvenient
forums. The foreign elements of the dispute
necessitate the immediate application of the
doctrine of forum non conveniens.
ISSUE:
(a.) Whether the RTC had jurisdiction over the
case.
(b.) Whether the complaint should be
dismissed on the ground of forum non
conveniens.
RULING:
(A)
Yes. On the matter of jurisdiction over a
conflicts-of-laws problem where the case is
filed in a Philippine court and where the court
has jurisdiction over the subject matter, the
parties and the res, it may or can proceed to
try the case even if the rules of conflict-of-laws
or the convenience of the parties point to a
foreign forum. This is an exercise of sovereign
prerogative of the country where the case is
filed.
Jurisdiction over the nature and subject matter
of an action is conferred by the Constitution
and the law and by the material allegations in
the complaint, irrespective of whether or not
the plaintiff is entitled to recover all or some of
the claims or reliefs sought therein. Civil Case
No. 1192-BG is an action for damages arising
from an alleged breach of contract.
Undoubtedly, the nature of the action and the
amount of damages prayed are within the
jurisdiction of the RTC.
As regards jurisdiction over the parties, the
trial court acquired jurisdiction over herein
respondent (as party plaintiff) upon the filing
of the complaint. On the other hand,
jurisdiction over the person of petitioner (as
party defendant) was acquired by its voluntary
appearance in court.A
(B)
No. Under the doctrine of forum non
conveniens, a court, in conflicts-of-laws
cases, may refuse impositions on its
jurisdiction where it is not the most
"convenient" or available forum and the
parties are not precluded from seeking
remedies elsewhere. Petitioner’s averments of
the foreign elements in the instant case are
not sufficient to oust the trial court of its
jurisdiction over Civil Case No. No. 1192-BG
and the parties involved.
Moreover, the propriety of dismissing a case
based on the principle of forum non
conveniens requires a factual determination;
hence, it is more properly considered as a
matter of defense. While it is within the
discretion of the trial court to abstain from
assuming jurisdiction on this ground, it should
do so only after vital facts are established, to
determine whether special circumstances
require the court’s desistance.
4. FORT BONIFACIO DEVELOPMENT
CORPORATION VS SORONGON AND
FONG GR NO. 176709, MAY 8, 2009
FACTS: Petitioner Fort Bonifacio
Development Corporation entered into a trade
contract with L & M Maxco Specialist
Construction’s wherein Maxco would
undertake the structural and partial
architectural package of the Bonifacio Ridge
Condominium Phase1 (BRCP). Later,
petitioner accused Maxco of delay in
completion of its work and sent the latter a
notice of termination. Subsequently, Maxco
was sued by its creditors including respondent
for debts unrelated to BRCP 1. In order to
settle the collection suit, Maxco assigned its
receivables representing its retention money
from the BRCP 1 in the amount of P1,
577,115.90. Respondent Valentin Fong
informed petitioner regarding Maxco’s
assignment in his favor and asked to confirm
the validity of Maxco’s receivables. Petitioner
informed respondent Fong that there is no
more amount due to Maxco from petitioner
after the rectification of defect as well.
Respondent Fong filed a complaint for a sum
of money against petitioner and Maxco in the
Regional Trial Court of Mandaluyong City.
Petitioner argued that since respondent
merely stepped into the shoes of Maxco as its
assignee, it was the CIAC and not the regular
courts that had jurisdiction over the dispute as
provided in the Trade Contract.
ISSUE: Whether or not CIAC has jurisdiction
over the claims of Valentin Fong?
HELD: No, CIAC has no jurisdiction on such
claims. An examination of the allegations in
Fong’s complaint revealed that his cause of
action springs not from a violation of the
provisions of the Trade Contract, but from the
assignment of Maxco’s retention money to
him and failure of petitioner to turn over the
retention money. Although the jurisdiction of
the CIAC is not limited to the instances
enumerated in Section 4 of E. O. No. 1008,
Fong’s claim is not even construction-related
at all. This court has held that: "Construction
is defined as referring to all on-site works on
buildings or altering structures, from land
clearance through completion including
excavation, erection and assembly and
installation of components and equipment."
Thus, petitioner’s insistence on the application
of the arbitration clause of the Trade Contract
to Fong is clearly anchored on an erroneous
premise that the latter is seeking to enforce a
right under the trade contract. Fong’s demand
that the portion of retention money should
have been paid to him before the other
creditors of Maxco clearly, does not require
the CIAC’s expertise and technical knowledge
of construction.
5. G.R. No. L-26379 December 27, 1969
WILLIAM C. REAGAN, ET. AL vs.
COMMISSIONER OF INTERNAL REVENUE
FACTS:
Petitioner Reagan, a civilian employee of an
American corporation providing technical
assistance to the US Air Force in the
Philippines, questioned the payment of the
income tax assessed on him by respondent
CIR on an amount realized by him on a sale
of his automobile to a member of the US
Marine Corps, the transaction having taken
place at the Clark Field Air Base at
Pampanga. It is his contention, that in legal
contemplation the sale was made outside
Philippine territory and therefore beyond our
jurisdictional power to tax. He seeks that an
amount of P2,979.00 as the income tax paid
by him be refunded.
ISSUE: WON the Clark Field Air Base is a
foreign property therefore excluded from the
power of Philippine taxation.
HELD:NO.
By the [Military Bases] Agreement, it should
be noted, the Philippine Government merely
consents that the United States exercise
jurisdiction in certain cases. The consent was
given purely as a matter of comity, courtesy,
or expediency over the bases as part of the
Philippine territory or divested itself
completely of jurisdiction over offenses
committed therein. This provision is not and
can not on principle or authority be construed
as a limitation upon the rights of the Philippine
Government.
The State is not precluded from allowing
another power to participate in the exercise of
jurisdictional right over certain portions of its
territory. If it does so, it by no means follows
that such areas become impressed with an
alien character. They retain their status as
native soil. They are still subject to its
authority. Its jurisdiction may be diminished,
but it does not disappear. So it is with the
bases under lease to the American armed
forces by virtue of the military bases
agreement of 1947. They are not and cannot
be foreign territory.
6. PERKINS V. DIZON G.R. NO. 46631,
NOVEMBER 16, 1939
Facts: On July 6, 1938, respondent, Eugene
Arthur Perkins, instituted an action in the
Court of First Instance of Manila against the
Benguet Consolidated Mining Company for
dividends registered in his name, payment of
which was being withheld by the company;
and, for the recognition of his right to the
control and disposal of said shares, to the
exclusion of all others. The company filed its
answer alleging that the withholding of such
dividends and the nonrecognition of plaintiff's
right to the disposal and control of the shares
were due to certain demands made with
respect to said shares by the petitioner herein,
Idonah Slade Perkins, and by one George H.
Engelhard. Including defendant petitioner,
Idonah Slade Perkins, and George H.
Engelhard in his amended complaint,
respondent Perkins prayed that they be
adjudged without interest in the shares of
stock in question and excluded from any claim
they assert thereon. Thereafter, summons by
publication were served upon these two non-
resident defendants pursuant to the order of
the trial court. Engelhard filed his answer to
the amended complaint while petitioner
Idonah Slade Perkins, through counsel,
challenged the jurisdiction of the lower court
over her person
Issue: Whether or not the Court of First
Instance of Manila has acquired jurisdiction
over the person of the present petitioner as a
non-resident defendant, or, notwithstanding
the want of such jurisdiction, whether or not
said court may validly try the case.
Held: Yes. Section 398 of our Code of Civil
Procedure provides that when a non-resident
defendant is sued in the Philippine courts and
it appears, by the complaint or by affidavits,
that the action relates to real or personal
property within the Philippines in which said
defendant has or claims a lien or interest,
actual or contingent, or in which the relief
demanded consists, wholly or in part, in
excluding such person from any interest
therein, service of summons maybe made by
publication. The action being in quasi in rem,
The Court of First Instance of Manila has
jurisdiction over the person of the non-
resident. In order to satisfy the constitutional
requirement of due process, summons has
been served upon her by publication. There is
no question as to the adequacy of publication
made nor as to the mailing of the order of
publication to the petitioner's last known place
of residence in the United States. But, of
course, the action being quasi in rem and
notice having be made by publication, the
relief that may be granted by the Philippine
court must be confined to the res, it having no
jurisdiction to render a personal judgment
against the non-resident.