E.

Situs of Certain Properties Situs: Latin; location it is the place where a particular event occurs, or where a property is treated as being located for legal purposes the rules on determining situs is important in determining which State has jurisdiction or control over certain property and thusly, which law shall be controlling or shall be applied to such property 1. Situs of Personal Property for Tax Purposes State's power of taxation it is an essential and inherent attribute of sovereignty belonging as a matter of right to every independent government (Virginia Law eview, !"#$% taxing ta&es into consideration facts of legal ownership, actual presence, and control elsewhere taxing does not only consider situs, but also nexus or a justifiable connection to a State; meaning, even if a taxpayer is found within or outside of the territory of the 'hilippines, it still has the jurisdiction to tax as long as there is a nexus (octrine of ')obilia Se*uuntur 'ersonam' common law doctrine holding that personal property held by a person is governed by the same law that governs that person, so that if a person who is legally domiciled in one jurisdiction dies with property in a second jurisdiction, that property is legally treated as though it were in the first jurisdiction+ this doctrine has been viewed as a mere ,fiction of law, based on considerations of general convenience and public policy this doctrine cannot be applied for tax purposes; it cannot be applied to limit the right of the State to tax property within its jurisdiction -.S/0 .S1.21- '/2 3L/4) VS+ -3 541-3 6acts0 -o 5uico became the sales agent on commission of .siatic 'etroleum; he had the duty of selling their products, and to render a proper accounting+ -o defaulted and did not render an account of the sales, he then left for -hina+ .siatic filed a suit to recover the amount, and attached his ban& deposits with the )ercantile 7an& of -hina+ .fter summons by publication, -o was declared in default, a writ of execution was issued, and levy was made on the deposits, which was returned unsatisfied+ -o's counsel made an appearance to have the proceedings declared null and void because they were not able to ac*uire jurisdiction over the person of -o+ 2he lower court declared the proceedings null and void; it was an action in personam and summons by publication was not sufficient+ 1ssue0 8hether the attachment was valid uling0 2he attachment is valid+ 2he modern tendency in analy9ing the problem is to ma&e no distinction between mobility and immobility of the property (using the doctrines of lex rei sitae and mobilia se*uuntur personam%+ 1t is also not necessary to characteri9e the action as one of in rem or *uasi in rem+

.ll property within a State is subject to the jurisdiction of its courts, and they have the right to adjudicate title thereto, to enforce liens thereupon, and to subject it to the payment of the debts of its owners, whether resident or not+ 2he sovereign power may lay hands on any and all persons or property within its borders+

ule0 . State has the power to tax property within its jurisdiction 2. Situs of Money -.S/0 L/3: VS ).:46.-24 / S L16/ 1:S4 .:-/ -3+ 6acts0 7utler, a former resident of the 'hilippines, died in :ew ;or&+ (uring the probate proceedings for his will, oss Sr+, oss <r+, and Selph were named executors+ oss <r+, who was appointed trustee for the purpose of carrying out the provisions of the will, bought an annuity from )anufacturers Life 1nsurance -o+ in accordance with the said will for the benefit of )ercedes de Leon (the contract of which stated that )ercedes would be receiving a monthly allowance through the insurance company's )anila office%+ )ercedes presented 7utler's will for probate in the -ourt of 6irst 1nstance of )anila (seemingly with the objective of getting hold of the whole amount of the annuity% and =he99i was appointed administratrix+ 1ssue0 8hether )anila courts have authority over the assets, specifically the proceeds from the annuity uling0 :o, the money was outside of the jurisdiction of )anila courts+ ule0 .dministration extends only to the assets of a decedent found within the state or country where it was granted+ /ffect0 .n administrator appointed in one state has no power over property in another state or country+ 6irst, the asset (money% was invested in an annuity in -anada, and the contract was executed in -anada+ 2herefore, -anada is the situs of the money+ 2here is no showing either that the money was transferred to the )anila 7ranch+ Second, even if the money was transferred, it would no longer form part of 7utler's estate and is beyond the control of the court+ 1t has passed completely into the hands of the company in virtue of a contract duly authori9ed and validly executed+ 2hird, the administratrix is a complete stranger to the subject of the motion and to the appellee (insurance company%+ 2here being no creditors, the only subject of the motion is to enable )ercedes to get the legacy in a lump sum in complete disregard of the wishes of the testator, who showed deep concern for her welfare, and of the annuity contract which the annuitant herself applied for in conjunction with the trustee+ ule0 Situs of money is where the money is found 3. Situs of Debts Salonga distinguishes between voluntary and involuntary assignments of debts for the purpose of determining what law shall apply the transaction+ Voluntary Assignments of Debts (via contract; transfer through assignment 2here are four theories as to what law should govern0

!+ mobilia se*uuntur personam0 personal property follows the owner; law that governs is the law of the domicile of the owner criticism0 the assignee of a debt cannot be expected to reali9e that he was subjecting his rights to the law of the domicile of the creditor, especially if it is considered that the place of domicile may be un&nown to him >+ lex actus0 the assignment of the debt is governed by the law of the place where the assignment is executed criticism0 the place where the assignment is made may be the least important of all points of contact; the rule does not meet with the reasonable expectations of the parties to the transaction #+ ascription of *uasi?situs to debts0 place where the debt is ,properly recoverable;, the assignment should be governed by the law of the place where the performance of the duty would normally be expected criticism0 multiple situation; recovery may be had in any court to whose jurisdiction the debtor is or may be subject @+ lex loci voluntatis (law of the place voluntarily selected% or lex loci intentionis (the law intended by the parties%0 since the debt is created by a contract between the assignor and the debtor, the proper law of the contract should govern the transfer or assignment where the intention cannot be determined expressly or impliedly, the proper law is the law having the most real and substantial connection with the transaction .ccording to Salonga, although the fourth theory is endorsed by eminent authorities (authors%, the rule is still unsettled+ 2he gaps would have to be filled by jurisprudence (-o*uia%+ !nvoluntary Assignments of Debts (via garnishment =arnishment0 process by which a judgment creditor attaches a sum of money that is due from a third person (garnishee% to the judgment debtor the court may order the garnishee to pay the money direct to the judgment creditor -.S/0 A. 1S VS+ 7.LB 6acts0 Aarris and 7al& are :orth -arolina domiciliaries+ Aarris owed 7al& C!D$+ 7al& owed more than C#$$ to /pstein, who lived in )aryland+ Aarris came to )aryland, and while there, was served by /pstein with a writ attaching the debt which Aarris owed 7al&+ 'rocess was delivered to a 7altimore sheriff and then placed at the court house door+ Aarris did not contest the garnishment action and consented to the entry against him of a payment of C!D$ which he paid+ 7ac& in :orth -arolina, 7al& sued Aarris to recover the C!D$+ Aarris pleaded the recovery of the )aryland judgment and contended that since there was a valid judgment, it was entitled to full faith and credit in :orth -arolina+ 2he court ruled in favor of 7al&; )aryland had no jurisdiction to garnish the debt because Aarris was only temporarily in the state, and the situs of the debt was in :orth -arolina+ 1ssue0 8hether the )aryland court had jurisdiction to garnish the debt uling+ )aryland had jurisdiction, and therefore, it was a valid judgment+ 1f there be a law of the State providing for the attachment of the debt, then if the garnishee be found in that State, and process be personally served upon him, the court thereby ac*uires jurisdiction over him, and can garnish the debt due from him to the debtor and condemn it, provided the garnishee could himself be sued by his creditor in that State+

'ower over the person of the garnishee confers jurisdiction on the courts of the State where the writ issues+ 1f, while temporarily there, his creditor might sue him there and recover the debt, then he is liable to the process of garnishment, regardless of situs of the debt+ 2he obligation of the debtor to pay his debt clings to and accompanies him wherever he goes+ 7al& could have sued Aarris in )aryland despite the temporary character of his stay there; the municipal law of )aryland permits the debtor of the principal debtor to be garnished

ule0 for voluntary0 proper law governing the contract (still unsettled; merely suggested by most authors% for involuntary0 law of the State where jurisdiction is effectively exercisable against the garnishee (debtor of the principal debtor% 4. Situs of Corporate Shares of Stocks Shares of Stoc&0 stoc&0 sum of all rights and duties of its stoc&holders share0 fraction of all the rights and duties which together compose this sum certificate0 certifies that one is a holder or owner of a certain number of shares of stoc& Sec+ E# of the -orporation -ode0 Shares of stoc& issued, representing the capital stoc& of corporations, are personal property and may be transferred by delivery of the certificateFs indorsed by the owner, or his attorney in fact or other persons legally authori9ed to ma&e the transfer+ 2he transfer, to be valid, must be recorded in the boo&s of the corporation showing the names of the parties to the transaction, date of the transfer, number of certificateFs and the number of shares transferred -.S/0 -3LL/-23 36 1:2/ :.L /V/:4/ VS+ .:=L3 -.L163 :1. :.213:.L 7.:B 6acts0 -alamba Sugar /state, 1nc+ (-S/1%, represented by its trustee, .nglo -alifornia, is a foreign corporation organi9ed and existing under the laws of the State of -alifornia, 4S., duly licensed to do business in the 'hilippines, and has continuously filed its income tax returns here+ -1 notified -S/1 of an assessment for an alleged deficiency income taxes based on !% capital gains from the sale of '>G$,$$$ shares of the capital stoc& of 'ampanga Sugar )ills to 'asumil 'lanters, 1nc+, and >% of a promissory note executed by 'ampanga Sugar )ills in the sum of CG$$,$$$+ 2he sale and the payments were made in -alifornia+ 2he sale was made under and in accordance with the laws of -alifornia+ -S/1's license was cancelled by the S/and was dissolved in accordance with the laws of that state+ -2. absolved respondent from liability0 capital gains which constituted income was derived from abroad and not subject to income tax+ 1ssue0 8hether the sale constituted income from sources within or without the 'hilippines uling0 -apital gains constituted income from outside the 'hilippines+ .lthough shares of stoc& of a corporation represent e*uities may consist of real as well as personal properties therein, they are considered under applicable law and jurisprudence as intangible personal properties

Section >@ of the :ational 1nternal evenue -ode levies income taxes on foreign corporations only on income derived from sources within the 'hilippines; and with respect to capital gains on the sale of personal properties, section #H (e% of the same 2ax -ode deems the place of sale as also that place or source of the capital gain o =ains, profit, and income derived from the purchase of personal property within and its sale without the 'hilippines or from the purchase or personal property without and its sale within the 'hilippines, shall be treated as deri ed entirely fro! sources "ithin the country in "hich sold Li&ewise, 4S courts construe the same provision of law disallows the imposition of income taxes by its government on capital gains where the sale ta&es place outside its territorial jurisdiction+ 1t is admitted that the negotiation, perfection and consummation of the contract of sale were all done in -alifornia, 4S.+ 1t follows that title to the shares of stoc& passed from the vendor to the vendee at said place, from which time the incidents of ownership vested on the buyer+ 1n this case, what is of concern is the tax imposed on the sale of the shares which resulted in capital gains, as opposed to the tax imposed on the shares themselves+ 8hile the former is governed by the law where the sale too& place, the latter is governed by the law of the place of incorporation+

ule0 for the shares of stoc&, and purpose of taxing dividends0 law of the place of incorporation for the sale of the shares of stoc&, resulting in capital gains0 law of the place where the sale was consummated ". Patents# $ra%emar&s# $ra%e 'ame# an% Copyright -.S/0 =/:/ .L =. )/:2S -3 '+ V+ (1 /-23 36 '.2/:2S

6acts0 'uritan Sportswear -orporation is a 'ennsylvanian corporation, while =eneral =arments is a 'hilippine corporation+ 'uritan filed a petition with the 'hilippine 'atent 3ffice for the cancellation of the trademar& ,'uritan, registered in the name of =eneral =arments -orporation+ 'uritan alleged that they owned the trademar&, and alleged prior use of the trademar& on the same &ind of goods, which use it had not abandoned+ 2hey also alleged that the registration by =eneral =arments had been obtained fraudulently+ =eneral =arments filed a motion to dismiss and challenged the legal capacity of 'uritan, a foreign corporation not licensed to do business and not doing business in the 'hilippines, to maintain a suit in the 'hilippine 'atent 3ffice for cancellation of a trademar& registered therein+ 1ssue0 8hether 'uritan has the legal capacity to sue or maintain an action for cancellationI uling0 'uritan has the legal right to maintain an action+ Section !H of the 2rademar& Law states that ,any person, who believes that he is or will be damaged by the registration of a mar& or trade?name, may file a petition for cancellation of trademar& or name+ 'uritan is undoubtedly a juridical person within the purview of the law and as comprehended in the phrase ,any person+, 2he fact that it may not transact business in the 'hilippines nor maintain a suit in 'hilippine courts does not ma&e it any less a juridical person+

2here is even the exception that foreign corporations may sue in the basis of an isolated transaction0 the recovery of any debt, claim or demand+ .s held in a previous case which posed an analogous *uestion (8estern /*uipment and Supply -o+ vs+ eyes%, a foreign corporation which has never done business in the 'hilippine 1slands and which is unlicensed and unregistered to do business here, but is widely and favorable &nown in the 1slands through the use of its products bearing its corporate and trade name has a legal right to maintain an action in the 1slands+ 2he purpose of the suit is to protect its reputation, corporate name and goodwill+ Such right to the use of the corporate or trade name is a property right, a right in rem, which it may assert and protect in any of the courts of the world+

ule0 . state will protect only such patent, designs, trademar&s, and copyrights as it has itself granted, either by particular act (privilege% or general statute+