CONFLICTS OF LAW

PROPERTY LAW
I. Controlling Law
A. Immovable - LEX SITUS
B. Movables
1. LEX DOMICILII - the of law of the place of the domicile the person
2. LEX SITUS - is the doctrine that the law governing the transfer of title to
property is dependent upon and varies with the location of the property, for
the purposes of the conflict of laws
3. LEX LOCI ACTUS - the law of the place where the is done
4. PROPER LAW OF THE FORUM - the is law of the forum, where the case
filed

II. Capacity to transfer or acquire property

A. Real Property - lex situs

III. Extrinsic and Intrinsic Validity of Conveyances

A. Formalities, essential validity, and effects of conveyance –governed by LEX SITUS.

IV. Exception to Lex Situs Rule

A. The transaction does not affect transfer of title to/ownership of the land –LEX
INTENTIONIS or LEX VOLUNTATIS
B. Contracts where real property is offered by way of a security for the performance of
an obligation such as a loan
C. Testate or intestate succession and capacity to succeed –LEX NATIONALII

V. Situs of Certain Properties

A. Situs of Personal Property for Tax Purposes
B. Situs of Money
C. Situs of Debts
D. Corporate Shares of Stock
1. For tax purposes
2. For sale
VI. READ CASES

CONTRACTS
I. Extrinsic validity of contracts
LEX LOCI CELEBRATIONIS - law the is of the place of the ceremony or law of the
place where a contract made; the the law of the place where contract is entered
into
 Art. 17, CC. The forms and solemnities of contracts, wills, and other public
instruments shall be governed by the laws of the country in which they are
executed.
When the acts referred to are executed before the diplomatic or consular officials of
the Republic of the Philippines in a foreign country, the solemnities established by
Philippine laws shall be observed in their execution.

II. Intrinsic validity of contracts

A. LEX LOCI CONTRACTUS - law of the place where a contract is executed or to be
performed; the proper law applicable in deciding the rights and liabilities of the
contracting parties
B. LEX LOCI SOLUTIONIS - is the law applied in the place of an event. If a case comes
before a court and all the main features of the case are local, the court will then
apply the lex fori, the prevailing municipal law, to decide the case.
C. LEX LOCI INTENTIONIS - the law of the place intended by the parties to the contract

III. Capacity to enter into contracts

A. Governed by the personal law of the parties
1. LEX NATIONALII; or
2. LEX DOMICILII

IV. Choice of law issues in conflicts contract cases

A. Choice of Forum Clause
1. Questions of venue, not jurisdiction
2. Includes arbitration, not only choice of court.
B. Contracts with Arbitration Clause Arbitration clause –a provision in a contract
stipulating that any dispute arising from the contract shall be submitted to a
particular body for arbitration

An arbitration clause, stipulating that the arbitral award is final and binding, does
not oust our courts of jurisdiction as the international arbitral award, is still
judicially reviewable under certain conditions

V. Features of R.A. 9285 applying and incorporating the UNCITRAL Model Law
A. RTC must refer to arbitration in proper cases
B. foreign arbitral awards must be confirmed by RTC
C. RTC has jurisdiction to review foreign arbitral awards
D. grounds for judicial review different in domestic and foreign arbitral awards
E. RTC decision of assailed foreign arbitral award appealable. [Korea Technologies v.
Lerma, G.R. No. 143581, 2008]

VI. Adhesion Contracts

 A. General Rule: Not void per se
B. Exception: when there is an undue advantage made by a dominant party

VII. Special Contracts

A. Carriage of Goods by Sea (COGSA) - The Carriage of Goods by Sea Act is a United
States statute governing the rights and responsibilities between shippers of cargo
and ship-owners regarding ocean shipments to and from the United States
B. Contracts for International Air Transportation
1. Any action for damages may be brought either:
a) In the court of the domicile of the carrier;
b) In his principal place of business through which the contract has
been made; OR
c) Before the court at the place of destination.

VIII. Limitations to Choice of Law

A. Parties may not select a law that has no connection at all with the transaction or the
parties
B. If the law selected should change, the law as changed will govern. Exception: If the
change is so revolutionary that it was never contemplated by the parties
C. Should not be interpreted to oust the jurisdiction court already acquired over the
parties and the subject matter
D. Public policy deemed written into contracts impressed with public interest
E. CognovitClauses / Confession of Judgment Clauses –debtor may agree to be subject
to the jurisdiction of a specific court in case of breach or default in payment.

IX. READ CASES

SUCCESSION, WILLS, AND ESTATE

I. Extrinsic validity of wills
A. Art. 17, CC. The forms and solemnities of contracts, wills, and other public
instruments shall be governed by the laws of the country in which they are
executed.
B. Art. 815, CC. When a Filipino is in a foreign country, he is authorized to make a will
in any of the forms established by the law of the country in which he may be. Such
will may be probated in the Philippines.
C. Art. 816, CC. The will of an alien who is abroad produces effect in the Philippines if
made with the formalities prescribed by the law of the place in which he resides, or
according to the formalities observed in his country, or in conformity with those
which this Code prescribes.
D. Art. 817, CC. A will made in the Philippines by a citizen or subject of another
country, which is executed in accordance with the law of the country of which he is a
citizen or subject, and which might be proved and allowed by the law of his own
 country, shall have the same effect as if executed according to the laws of the
Philippines.
E. Filipino nationals
1. LEX LOCI CELEBRATIONIS –formalities established by the law of the country
where the will is executed [Art. 17 and 815, CC]
2. LEX NATIONALII –formalities prescribed under Philippine law
F. For Aliens
1. LEX NATIONALII [Art. 816 and 817, CC]
2. LEX DOMICILII 3.LEX LOCI CELEBRATIONIS
G. With Regard to Joint Wills
1. By Filipinos: VOID under Philippine law on the ground of public policy. [Art.
818, CC]
2. By Foreigners: VALID UNLESS it affects heirs in the Philippines.

II. Intrinsic validity of wills

A. Governed by the national law of the decedent [Art. 16, CC]
B. Includes issues of substance such as order of succession, amount of successional
rights and intrinsic validity of testamentary provisions [Art. 16, CC]

III. Interpretation of wills - Governed by the rules of interpretation of the national law of the
decedent [Art. 16, CC]

IV. Revocation of wills

A. When done in the Philippines Philippine Law applies
B. Done outside the Philippines, by a person domiciled in the Philippines
1. LEX DOMICILII –Philippine Law
2. LEX LOCI ACTUS –Law of the place of revocation
3. LEX LOCI CELEBRATIONIS –Law of the place where the will was made
C. Done outside the Philippines, by a non domiciliary
1. LEX LOCI CELEBRATIONIS –Law of the place where the will was made
2. LEX DOMICILII –Law of the place where testator was domiciled at the time
of revocation

V. Probate - FORUM LAW governs but court will look into the law of the foreign state where
the will was made for extrinsic validity

VI. Administration of estates

A. Governing Law
1. Choice of law provision
2. If none, the law that will sustain the validity of the trust.

Testamentary trusts depend for their extrinsic validity on the will which created them; as to
intrinsic validity, lex situs determines the validity.
VII. READ CASES
TORTS AND CRIMES
I. Policies Underlying Substantive Tort Law
A. To deter undesirable or wrongful conduct; and
B. To rectify the consequences of tortious act by distributing losses that result from
accident and product liability

II. Lex Loci DelictiCommissifor Torts

A. Law of the place where the alleged tort was committed.
1. COMMON law-the place where the last event necessary to make an actor
liable occurred (adheres to vested rights theory)
2. CIVIL law-the place where tortious conduct was committed

Traditional View on Jurisdiction-an actor liable by LEX LOCI DELICTI COMMISSI is

liable everywhere
B. Modern Theories on Foreign Tort Liability
1. The Most Significant Relationship - to ascertain what state law to apply to a
dispute, the court should determine which state has the most substantial
connection to the occurrence and the parties.

Test:
● 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.
2. Interest Analysis - describe more modern choice of law approaches in which
courts identify those states with interests in a particular issue before the
court and then determine which of the competing states should have its law
applied to the issue
3. Cavers’ Principle of Preference - principles of preference are to be applied
when after a preliminary analysis, a true conflict is discovered. By
hypothesis in a false conflict case there is only one interested jurisdiction
and the law of the interested jurisdiction should govern. "The choice of that
law would not be the result of the automatic operation of a rule or principle
of selection but of a search for a just decision.

III. Foreign Tort Claims

A. Tortious liability is transitory
B. Philippine Rule on Foreign Torts: follow English Rule - Under the English law of
torts, no action can arise in a case where any tort relating to immovable property is
 committed and thus in such cases, the suit filed by the plaintiff is rejected by the
courts.

IV. Tort vs. Crime

A. Tort: transitory; crime: localo
B. Tort: personal to the tortfeasor; crime: injury to the state where committed
C. Tort: injury to an individual who may be situated in any place; crime: affront against
sovereignty and good order of the State where
D. Tort: amenable to suit in whatever jurisdiction he is found; crime: can be sued only
where crime was committed
E. Torts law assigns the liability to perpetrators in order to indemnify the victim for
injuries sustained; penal laws are promulgated to punish and reform the
perpetrators and deter them and others from violating the law

V. Lex loci delicti for crimes

A. General rule: law of the place where the crime was committed based on the
territoriality principle
B. NULLUM CRIMEN SINE LEGE. An act is punishable if it has been made punishable as
a crime by law
C. Exceptions to lex loci delicti
1. Crimes committed by state officials, diplomatic representatives and officials
of recognized international organizations
2. Crimes committed on board foreign vessels even if it is within the territorial
waters of the coastal state, except: (Art. 27 of UNCLOS)
a) When the consequences of said crime extend to the coastal state;
b) When it will disturb the peace or good order of the country;
c) When the assistance of local authorities has been requested by the
master of the ship or diplomatic agent or consular officer of the flag
state; or
d) When such measures are necessary for the suppression of illicit
traffic in narcotic drugs or psychotropic substances.
3. Crimes committed by Philippine nationals abroad under Article 2 of the
Revised Penal Code:
a) On a Philippine ship or airship
b) Forgery or counterfeit any coin or currency note of the Philippine
Islands or obligations and securities issued by the Government of the
Philippine Islands
c) Introduction of those mentioned above into the Philippines
d) Public officers or employees committing an offense in the exercise of
their functions
e) Crimes against national security and the law of nations, defined in
Title One of Book Two of the RPC.
VI. READ CASES
CORPORATIONS
I. Four Basic Theories: [Bank of Augusta v. Earle, 38 U.S. 519, 1839]
A. A corporation has no legal status beyond the bounds of sovereignty within which it
was createdException: Consent Doctrine
B. A corporation cannot exercise powers not granted by its corporate charter or by the
laws of the state of incorporation
C. No state is under any obligation to adhere to the doctrine of comity. It has the power
to refuse to recognize or prevent the foreign corporation from acting within its
jurisdiction
D. A state is not obliged to grant the foreign corporation privileges and immunities
common to citizens of that state

II. Personal law of a Corporation - Law of the state where it is incorporated

A. Exceptions to the Rule of Incorporation
1. Test of Constitutional and Statutory Restrictions
2. Control Test During War

III. Domicile or residence of foreign corporations

A. When the law creating or recognizing them, or any other provision does not fix the
domicile of juridical persons, domicile is:
1. The place where their legal representation is established; or
2. Where they exercise their principal functions [Art. 51, CC]

IV. Jurisdiction over foreign corporations

A. Consent Doctrine-a foreign corporation shall be recognized and allowed to transact
business in any state which gives its consent
B. Foreign corporations doing business in the Philippines are bound by Philippine law
except for:
1. Provisions for creation, formation, organization or dissolution
2. Provisions which fix the relations liabilities, responsibilities or duties of
stockholders, members, or officers of the corporation
C. Service upon foreign corporations doing business in the Philippines [Sec. 14, Rule
14, ROC]
1. General Rule: Resident Agent
2. Exception: If the corporation DOES NOT have a resident agent, then service
may be made on:
a) Government official designated by law;
b) Any of its officers or agent within the Philippines;
c) Summons through diplomatic channels

V. Right of Foreign Corporation to Bring Suit and be Sued

 A. License to transact business in the Philippines is a prerequisite for filing a suit
before Philippine courts. Such corporation may be sued or proceeded against before
Philippine courts or administrative tribunals. [Sec. 133, Corporation Code]
B. A foreign corporation which does business without a license can still be sued.
C. Exceptions to the License Requirement
1. Isolated Transactions
2. Action to Protect Trademark, Trade Name, Goodwill, Patent or for Unfair
Competition
3. Agreements Fully Transacted Outside the Philippines
4. Counterclaim

VI. Definition and Scope of “Transacting Business”

A. Under the Foreign Business Registration Act and Foreign Investments Act, acts that
constitute DOING BUSINESS includes:
1. Soliciting orders, service contracts, opening offices
2. Appointing representatives or distributors either:
a) Domiciled in the Philippines
b) Stay in the country for 180 days or more
3. Participating in the management, supervision, or control of any domestic
business, firm, entity, or corporation in the Philippines
4. Any other act that implies a continuity of commercial dealings or
arrangements
5. The exercise of some functions normally incident to, and in progressive
prosecution of, commercial gain or of the purpose and object of the business
organization

VII. Not doing business

A. Activities which do not bring any direct receipts or profits to the foreign
corporations
B. Mere investment as a shareholder in a domestic corporation and/or exercise of
rights as such investor
C. Having a nominee director or officer to represent interests in such corporation
D. Appointing a representative or distributor domiciled in the Philippines which
transacts business in its own name and for its own accounts
E. Publication of general advertisement through any media
F. Maintaining of stocks of goods in the Philippines solely for the purpose of having the
same processed by another entity
G. Consignment of equipment with a local company to be used in the processing of
products for export
H. Collecting information in the Philippines
I. Services auxiliary to an existing isolated contract of sale which are not on a
continuing basis
VIII. READ CASES

IX. PARTNERSHIP
A. Governing Law
1. LAW OF DOMICILE
2. PERSONAL LAW
3. PHILIPPINE LAW
B. Extraterritorial enforcement of in personam judgments against partnership
C. there is jurisdiction over the partnership or unincorporated association if under the
circumstances, there is jurisdiction over an individual
D. A judgment against a partnership or association is enforceable against its assets in
every state.

FOREIGN JUDGMENTS
I. Recognition and Enforcement of Foreign Judgment
A. Functions of Recognition and Enforcement
1. The successful plaintiff may try to enforce judgment in another state where
defendant can be located if he fails to obtain satisfaction in the court which
granted it.
2. A successful defendant may assert that decision in order to preclude the
plaintiff from filing a suit on the same claim in another forum.
B. Distinction between Recognition and Enforcement
1. Recognition-passive act of giving effect to a foreign judgment without
necessity of filing an action in the other forum.
2. Enforcement-requires filing of an action in court wherein a new judgment
must be handed down.

II. Bases of recognition and enforcement of foreign judgment

A. Comity - comity is "a practice among different political entities" involving the
"mutual recognition of legislative, executive, and judicial acts."
B. Obligation of foreign judgment - Foreign judgments may be enforced in the
Philippines under procedural rules or jurisprudence (Mijares v Ranada, 455 SCRA
397 (2005)). The Philippines is not a signatory to the Hague Convention on the
Recognition and Enforcement of Foreign Judgments in Civil and Commercial Matters

III. Policies underlying recognition and enforcement

A. Res judicata
B. Under Philippine law: [Sec. 40, Rule 39, ROC]
1. Judgment or final order upon a SPECIFIC THING-renders it conclusive upon
the title to the thing
2. Judgment against a PERSON-presumptive evidence of a right between
parties and their successors in interest
IV. Requisites for recognition and enforcement of foreign judgment
A. Rendered by a court with jurisdiction over the parties and the casea.
1. In personam jurisdiction--based on consent of the parties; or the relation of
the parties or events to the forum
2. In rem jurisdiction--based on the State’s power over the property found
within the territory
B. Judgment must be valid under the laws of the court that rendered It
C. Judgment must be final and executory to constitute res judicata in another action
D. (Reciprocity) State where foreign judgment was obtained allows recognition or
enforcement of Philippine judgements
E. Judgment must be for a fixed sum of money
F. Judgment must NOT be CONTRARY to the PUBLIC POLICY or GOOD MORALS of the
country where it is to be enforced
G. Judgement must not have been obtained by fraud, collusion, mistake of fact or
mistake of law

V. Procedure for Enforcement

A. Three Modes of Enforcement:
1. By filing a new action in the court where enforcement is sought
2. Summary proceeding or Exequatur procedure
3. Judgment Registration

VI. READ CASES