G.R. No. L-12105 January 30, 1960TESTATE ESTATE OF C. O.

BOHANAN,
!"!a#!.$H%L%$$%NE TR&ST CO., !'!"u(or-a))!**!!,+#. ,AG-ALENA C.
BOHANAN, E-.AR- C. BOHANAN, an ,AR/ L/-%A BOHANAN,o))o#0(or#-
a))!**an(#.
Issues:
The oppositors, Magadalena C. Bohanan and her two children, question the validity
of the executor/testator C.. Bohanan!s last will and testa"ent, clai"ing that they
have #een deprived of the legiti"ate that the laws of the for" concede to the".
$nother, is the clai" of the testator%s children, &dward and Mary 'ydia Bohanan, who
had received legacies in the a"ount of ()( *, +++ each only, and, therefore,
have not #een given their shares in the estate which, in accordance with the laws,
should #e two,thirds of the estate left #y the testator.
-acts:
C.. Bohanan was #orn in .e#ras/a and therefore a citi0en of that state..otwithstan
ding his long residence in the (hilippines, he continued and re"ained to #e a citi0en
of the 1nited 2tates and of the state of his pertinent residence to spend the rest of
his days in that state. )is per"anent residence or do"icile in the 1nited 2tates
depended upon his personal intent or desire, and he selected .evada as his
ho"icide and therefore at the ti"e of his death, he was a citi0en of that state.
)eld:
The first issue refers to the share that the wife of the testator, Magdalena C.
Bohanan, should #e entitled to receive. The will has not given her any share in the
estate left #y the testator. It is argued that it was error for the trial court to have
recogni0ed the 3eno divorce secured #y the testator fro" his -ilipino wife Magdalena
C. Bohanan, and
thatsaid divorce should #e declared a nullity in this 4urisdiction. The court refused tore
cogni0e the clai" of the widow on the ground that the laws of .evada, of which the
deceased was a citi0en, allow hi" to dispose of all of his properties without requiring
hi" to leave any portion of his estate to his for"er 5or divorced6 wife. .o right to
share in the inheritance in favor of a divorced wife exists in the 2tate of .evada, thus
the oppositor can no longer clai" portion of the estate left #y the testator. 7ith
regards the second issue, the old Civil Code, which is applica#le to this
case#ecause the testator died in 89::, expressly provides that successional rights to
personal property are to #e earned #y the national law of the person whose
succession is in question, thus the two,third rule is not enforcea#le.
,0"0ano +# Br01o
-$CT2:
;uan Miciano, 4udicial ad"inistrator of the estate in question, filed a sche"e of
partition. $ndre Bri"o, one of the #rothers of the deceased 5;oseph Bri"o6 opposed
Miciano!s participation in the inheritance. ;oseph Bri"o is a Tur/ish citi0en.
I221&: 7hether Tur/ish law or (hilippine law will #e the #asis on the distri#ution of
;oseph Bri"o!s estates.
)&'<:
Though the last part of the second clause of the will expressly said that =it #e "ade
and disposed of in accordance with the laws in force in the (hilippine Island>, this
condition, descri#ed as i"possi#le conditions, shall #e considered as not i"posed
and shall not pre4udice the heir or legatee in any "anner whatsoever, even should the
testator otherwise provide. I"possi#le conditions are further defined as those
contrary to law or good "orals. Thus, national law of the testator shall govern in his
testa"entary dispositions.
The court approved the sche"e of partition su#"itted #y the 4udicial ad"inistrator, in
such "anner as to include $ndre Bri"o, as one of the legatees.

CHEES,AN 2 %AC 193 SCRA 93G.R. No. 34533 January 21, 1991
-$CT2:
This appeal concerns the atte"pt #y an $"erican citi0en 5petitioner Tho"as
Chees"an6 to annul
for lac/ of consent on his part the sale #y his -ilipino wife 5Criselda6 of a residential lot
and#uilding to &stelita (adilla
?<ece"#er :, 89@+ A Tho"as Chees"an and Criselda Chees"an were "arried #ut
have #een separated since -e#ruary 8B, 89C8
?;une :, 89@: A a <eed of 2ale and Transfer of (ossessory 3ights was executed #y
$r"ando $ltares, conveying a parcel of land in favor of DCriselda Chees"an,
"arried to Tho"as Chees"an. Tho"as, although aware of the deed, did not o#4ect
to the transfer #eing "ade only to his wife. Tax declarations for the said property were
issued in the na"e of Criselda Chees"an alone and she assu"ed exclusive
"anage"ent and ad"inistration of the property
?;uly 8, 89C8 A Criselda sold the property to &stelita (adilla without /nowledge and
consent of Tho"as
?;uly E8, 89C8 A Tho"as filed a suit for the annul"ent of the sale on the ground that
the transaction had #een executed without his /nowledge and consent. Criselda
filed an answer alleging that the property sold was paraphernal, having purchased the
property fro" her own "oneyF that Tho"as, an $"erican was disqualified to have
any interest or right of ownership in the land andF that &stelita was a #uyer in good
faith
?<uring the trial, it was found out that the transfer of property too/ place during the
existence of their "arriage as it was acquired on ;une :, 89@:
?;une G:, 89CG A 3TC declared the sale executed #y Criselda void a# initio and
ordered the delivery of the property to Tho"as as ad"inistrator of the con4ugal
property
?Tho"as appealed to I$C where he assailed the granting of &stelitaHs petition for
relief and resolution of "atters not su#4ect of said petitionF in declaring valid the sale
to &stelita without his /nowledge and consent. n ;anuary @, 89C*, I$C affir"ed
su""ary 4udg"ent decision
I221&: 7hether or not the wife can dispose of the property in questionF 7hether
or not Chees"an, #eing an $"erican citi0en, can question the sale
)&'<: 2ection 8:, $rt. IIJ of 89@E Constitution provides that: Dsave in cases
of hereditary succession, no private land shall #e transferred or conveyed except to
individuals, corporations, or associations qualified to acquire or hold lands of the
pu#lic do"ain.
Thus, assu"ing that it was his intention that the lot in question #e purchased #y hi"
and his wife, he acquired no right whatsoever over the property #y virtue of that
purchaseF and in atte"pting to acquire a right or interest in land, he was /nowingly
violating the Constitution. $s such, the sale to hi" was null and void. $t any rate,
Chees"an had and has . C$($CITK T L1&2TI. T)& 21B2&L1&.T2$'&
- T)& 2$M& (3(&3TK BK )I2 7I-& . T)&T)&3K T)$T I. 2 <I.M
)&I2 M&3&'K &I&3CI2I.M T)& (3&3M$TIJ& - $)12B$.< I. 3&2(&CT
-C.;1M$' (3(&3TK. To sustain such a theory would per"it indirect
controversion of the Constitutional prohi#ition.
If the property were to #e declared con4ugal, this would accord to the alien hus#and a
not in su#stantial interest and right over land, as he would then have a decisive vote
as to its transfer or disposition. This is a right that the Constitution does not per"it
hi" to have. &ven if the wife did use con4ugal funds to "a/e the acquisition, his
recovering and holding the property cannot #e warranted as it is against the
constitution. Consequently, &stelita is a purchaser in good faith since she /new that
Tho"as cannot intervene in the sale or disposition of the said property. <&CI2I.:
The Court $--I3M&< the appealed decision
M.3. .o. 89BBC+ $pril G8, G+8:

NARRA N%C6EL ,%N%NG AN- -E2ELO$,ENT COR$., TESORO ,%N%NG AN-
-E2ELO$,ENT, %NC., an,CARTH&R ,%N%NG, %NC., $!(0(0on!r#, +#. RE-,ONT
CONSOL%-ATE- ,%NES COR$.,R!#)on!n(.
-$CT2:
2o"eti"e in <ece"#er G++*, respondent 3ed"ont Consolidated Mines Corp.
53ed"ont6, a do"estic corporation organi0ed and existing under (hilippine laws, too/
interest in "ining and exploring certain areas of the province of (alawan. $fter
inquiring with the <epart"ent of &nviron"ent and .atural 3esources 5<&.36, it
learned that the areas where it wanted to underta/e exploration and "iningactivities
where already covered #y Mineral (roduction 2haring $gree"ent 5M(2$6
applications of petitioners .arra, Tesoro and Mc$rthur.
(etitioner Mc$rthur .arra and Tesoro, filed an application for an M(2$ and
&xploration (er"it 5&(6 which was su#sequently issued.
n ;anuary G, G++@, 3ed"ont filed #efore the (anel of $r#itrators 5($6 of the
<&.3 three 5E6 separate petitions for the denial of petitioners! applications for M(2$.
3ed"ont alleged that at least *+N of the capital stoc/ of Mc$rthur, Tesoro and .arra
are owned and controlled #y MBMI 3esources, Inc. 5MBMI6, a 8++N Canadian
corporation. 3ed"ont reasoned that since MBMI is a considera#le stoc/holder of
petitioners, it was the driving force #ehind petitioners! filing of the M(2$s over the
areas covered #y applications since it /nows that it can only participate in "ining
activities through corporations which are dee"ed -ilipino citi0ens. 3ed"ont argued
that given that petitioners! capital stoc/s were "ostly owned #y MBMI, they were
li/ewise disqualified fro" engaging in "ining activities through M(2$s, which are
reserved only for -ilipino citi0ens.
(etitioners averred that they were qualified persons under 2ection E5aq6 of 3epu#lic
$ct .o. 53$6 @9:G or the (hilippine Mining $ct of 899B. They stated that their
nationality as applicants is i""aterial #ecause they also applied for -inancial or
Technical $ssistance $gree"ents 5-T$$6 deno"inated as $-T$,IJB,+9 for Mc$rthur,
$-T$,IJB,+C for Tesoro and $-T$,IJB,+@ for .arra, which are granted to foreign,
owned corporations. .evertheless, they clai"ed that the issue on nationality should
not #e raised since Mc$rthur, Tesoro and .arra are in fact (hilippine .ationals as
*+N of their capital is owned #y citi0ens of the (hilippines.
n <ece"#er 8:, G++@, the ($ issued a 3esolution disqualifying petitioners fro"
gaining M(2$s. The ($ considered petitioners as foreign corporations #eing
Oeffectively controlledO #y MBMI, a8++N Canadian co"pany and declared their
M(2$s null and void. (ending the resolution of the appeal filed #y petitioners with the
M$B, 3ed"ont filed a Co"plaint with the 2ecurities and &xchange Co""ission
52&C6, see/ing the revocation of the certificates for registration of petitioners on the
ground that they are foreign,owned or controlled corporations engaged in "ining in
violation of (hilippine laws.
C$ found that there was dou#t as to the nationality of petitioners when it reali0ed that
petitioners had a co""on "a4or investor, MBMI, a corporation co"posed of 8++N
Canadians. (ursuant to the first sentence of paragraph @ of <epart"ent of ;ustice
5<;6 pinion .o. +G+, 2eries of G++B, adopting the 89*@ 2&C 3ules which
i"ple"ented the require"ent of the Constitution and other laws pertaining to the
exploitation of natural resources, the C$ used the Ograndfather ruleO to deter"ine the
nationality of petitioners.

In deter"ining the nationality of petitioners, the C$ loo/ed into their corporate
structures andtheir corresponding co""on shareholders.
1sing the grandfather rule, the C$ discovered that MBMI in effect owned "a4ority of
the co""on stoc/s of the petitioners as well as at least *+N equity interest of other
"a4ority shareholders of petitioners through 4oint venture agree"ents. The C$ found
that through a Owe# of corporate layering, it is clear that one co""on controlling
investor in all "ining corporations involved x x x is MBMI.O Thus, it concluded that
petitioners Mc$rthur, Tesoro and .arra are also in partnership with, or privies,in,
interest of, MBMI.
I221&: 7hether or not the Court of $ppeals! ruling that .arra, Tesoro and Mc$rthur
are foreign corporations #ased on the OMrandfather 3uleO is contrary to law,
particularly the express "andate of the -oreign Invest"ents $ct of 8998, as
a"ended, and the -I$ 3ules.
)&'<:
.o. There are two ac/nowledged tests in deter"ining the nationality of a corporation:
the control test and the grandfather rule. (aragraph @ of <; pinion .o. +G+, 2eries
of G++B, adopting the89*@ 2&C 3ules which i"ple"ented the require"ent of the
Constitution and other laws pertaining to the controlling interests in enterprises
engaged in the exploitation of natural resources owned #y -ilipino citi0ens, provides:
2hares #elonging to corporations or partnerships at least *+N of the capital of which
isowned #y -ilipino citi0ens shall #e considered as of (hilippine nationality
5C.T3' T&2T6, #ut if the percentage of -ilipino ownership in the corporation or
partnership is less than *+N, only the nu"#er of shares corresponding to such
percentage shall #e counted as of (hilippine nationality 5M3$.<-$T)&3 31'&6.
Thus, if 8++,+++ shares are registered in the na"e of a corporation or partnership at
least *+N of the capital stoc/ or capital, respectively, of which #elong to -ilipino
citi0ens, all of the shares shall #e recorded as owned #y -ilipinos. But if less than
*+N, or say,B+N of the capital stoc/ or capital of the corporation or partnership,
respectively, #elongs to -ilipino citi0ens, only B+,+++ shares shall #e counted as
owned #y -ilipinos and the other B+,+++shall #e recorded as #elonging to aliens.
The grandfather rule, petitioners reasoned, has no leg to stand on in the instant case
since the definition of a O(hilippine .ationalO under 2ec. E of the -I$ does not provide
for it. They further clai" that the grandfather rule Ohas #een a#andoned and is no
longer the applica#le rule.O They also opined that the last portion of 2ec. E of the -I$
ad"its the application of a Ocorporate layeringO sche"e of corporations. (etitioners
clai" that the clear and una"#iguous wordings of the statute preclude the court fro"
construing it and prevent the court!s use of discretion in applying the law. They said
that the plain, literal "eaning of the statute "eant the application of the control test is
o#ligatory.
2C disagreed. OCorporate layeringO is ad"ittedly allowed #y the -I$F #ut if it is used to
circu"vent the Constitution and pertinent laws, then it #eco"es illegal. -urther, the
pronounce"ent of petitioners that the grandfather rule has already #een a#andoned
"ust #e discredited for lac/ of #asis. (etitioners Mc$rthur, Tesoro and .arra are not
-ilipino since MBMI, a 8++N Canadian corporation, owns *+N or "ore of their equity
interests. 2uch conclusion is derived fro" grandfathering petitioners! corporate
owners, na"ely: MMI, 2MMI and ('M<C.
The Ocontrol testO is still the prevailing "ode of deter"ining whether or not a
corporation is a -ilipino corporation, within the a"#it of 2ec. G,$rt. II of the 89C@
Constitution, entitled to underta/e the exploration, develop"ent and utili0ation of the
natural resources of the (hilippines. 7hen in the "ind of the Court there is dou#t,
#ased on the attendant facts and circu"stances of the case, in the *+,:+ -ilipino,
equity ownership in the corporation, then it "ay apply the Ograndfather rule.O