Asiavest Limited v.

CA Digest
Asiavest Limited vs Court of Appeals
295 SCRA 469 Conflict of Laws Private International
Law Service of Summons to a Non Resident Processual
Presumption
In 1984, a Hong Kong court ordered Antonio Heras to pay
US$1.8 million or its equivalent, with interest, to Asiavest
Ltd. Apparently, Heras guaranteed a certain loan in Hong
Kong and the debtor in said loan defaulted hence, the
creditor, Asiavest, ran after Heras. But before said judgment
was issued and even during trial, Heras already left for
good Hong Kong and he returned to the Philippines. So
when in 1987, when Asiavest filed a complaint in court
seeking to enforce the foreign judgment against Heras, the
latter claim that he never received any summons, not
in Hong Kong and not in the Philippines. He also claimed
that he never received a copy of the foreign judgment.
Asiavest however contends that Heras was actually given
service of summons when a messenger from the Sycip
Salazar Law Firm served said summons by leaving a copy to
one Dionisio Lopez who was Heras son in law.
ISSUE: Whether or not the foreign judgment can be
enforced against Heras in the Philippines.

Facts:
1. The plaintiff Asiavest Limited filed a complaint
against the defendant Antonio Heras praying that
said defendant be ordered to pay to the plaintiff the
amounts awarded by the Hong Kong Court
Judgment. The action filed in Hong Kong against
Heras was in personam, since it was based on his
personal guarantee of the obligation of the principal
debtor.
2. 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.
3. Asiavest moved for the reconsideration of the
decision. It sought an award of judicial costs and an
increase in attorney's fees with interest until full
payment of the said obligations. On the other hand,
Heras no longer opposed the motion and instead
appealed the decision to CA.
4. The Court of Appeals (CA) agreed with Heras that
notice sent outside the state to a non-resident is
unavailing to give jurisdiction in an action against
him personally for money recovery. Summons should
have been personally served on Heras in Hong Kong,
Issue: Whether or not the judgment of the
Hong Kong Court has been repelled by
evidence of want of jurisdiction due to
improper notice to the party
YES.

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

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.
The action against Heras is an action in personam and as
far as Hong Kong is concerned, Heras is a non resident. He
is a non resident because prior to the judgment, he already
abandoned Hong Kong. The Hong Kong law on service of
summons in in personam cases against non residents was
never presented in court hence processual presumption is
applied where it is now presumed that Hong Konglaw in as
far as this case is concerned is the same as Philippine laws.
And under our laws, in an action in personam wherein the
defendant is a non-resident who does not voluntarily submit
himself to the authority of the court, personal service of
summons within the state is essential to the acquisition of
jurisdiction over her person.

This method of service is

possible if such defendant is physically present in the

country. If he is not found therein, the court cannot

1. Asiavest cannot now claim that Heras was a

resident of Hong Kong at the time since the
stipulated fact that Heras "is a resident of New
Manila, Quezon City, Philippines" refers to his
residence at the time jurisdiction over his person
was
being
sought
by
the
Hong
Kong
court. Accordingly, since Heras was not a resident of
Hong Kong and the action against him was, ne 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.
2. On the same note, Heras was also an
absentee,hence, he should have been served with
summons in the same manner as a non-resident 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.

acquire jurisdiction over his person and therefore

cannot validly try and decide the case against him.
Without

personal

service

of

summons,

the Hong

Kong court never acquired jurisdiction. Needless to say, the

summons tendered to Lopez was an invalid service because
the same does not satisfy the requirement of personal
service.

Saudi Arabian Airlines vs Court of Appeals

SAUDI ARABIAN AIRLINES VS. COURT OF

APPEALS,

297 SCRA 469 Conflict of Laws Private International Law

Situs Locus Actus
Milagros Morada was working as a stewardess for Saudia
Arabian Airlines. In 1990, while she and some co-workers
were in a lay-over in Jakarta, Indonesia, an Arab co-worker
tried to rape her in a hotel room. Fortunately, a roomboy
heard her cry for help and two of her Arab co-workers were
arrested

and

detained

in

Indonesia.

Later,

Saudia Airlines re-assigned her to work in their Manila

office. While working in Manila, Saudia Airlines advised her
to meet with a Saudia Airlines officer in Saudi. She did but
to her surprise, she was brought to a Saudi court where she
was interrogated and eventually sentenced to 5 months
imprisonment and 289 lashes; she allegedly violated Muslim
customs by partying with males. The Prince of Makkah got
wind of her conviction and the Prince determined that she
was wrongfully convicted hence the Prince absolved her
and sent her back to the Philippines. SaudiaAirlines later on
dismissed Morada. Morada then sued Saudia Airlines for
damages under Article 19 and 21 of the Civil Code.
Saudia Airlines filed a motion to dismiss on the ground that
the RTC has no jurisdiction over the case because the
applicable

law

should

be

the

law

of

Saudi

Arabia.

Saudia Airlines also prayed for other reliefs under the

premises.
ISSUE: Whether

or

not

Saudia Airlines

contention

is

correct.
HELD: No. Firstly, the RTC has acquired jurisdiction over
Saudia Airlines when the latter filed a motion to dismiss
with petition for other reliefs. The asking for other reliefs
effectively asked the court to make a determination of
Saudia Airliness rights hence a submission to the courts
jurisdiction.
Secondly, the RTC has acquired jurisdiction over the case
because as alleged in the complaint of Morada, she is
bringing the suit for damages under the provisions of our
Civil Law and not of the Arabian Law. Morada then has the

297
SCRA
4691998FACTS:Herein
private
respondent Milagros P. Morada is a flight attendant
for petitioner SAUDIA airlines, where the former was
tried to be raped by Thamer and Allah AlGazzawi,
both Sauidi nationals and fellow crew member, after
a night of dancing in their hotel while in Jakarta,
Indonesia. She was rescued. After twoweeks of
detention the accused were both deported to Saudi
and they werereinstated by Saudia. She was
pressured by police officers to make a statementand
to drop the case against the accused; in return she
will then be allowed toreturn to Manila and retrieved
her passport. For the second time, she was askedby
her superiors to again appear before the Saudi court.
Without her knowledge, she was already tried by
Saudi court together with the accused andwas
sentenced to five months imprisonment and to 286
lashes in connection withJakarta rape incident. The
court found her guilty of (1) adultery; (2) going to
adisco, dancing and listening to the music in
violation of Islamic laws; and (3)socializing with the
male
crew,
in
contravention
of
Islamic
tradition.ISSUE/S:WHETHER OR NOT the QC Regional
Trial Court has jurisdiction tohear and try the civil
case based on Article 21 of the New Civil Code or
theKingdom of Saudi Arabia court though there is
the existence of foreign element.RULING:The forms
in which a foreign element may appear are many,
such as the fact thatone party is a resident Philippine
national, and that the other is a resident
foreigncorporation. The forms in which this foreign
element may appear are many. Theforeign element
may simply consist in the fact that one of the parties
to a contractis an alien or has a foreign domicile, or
that a contract between nationals of oneState
involves properties situated in another State. In
other cases, the foreignelement may assume a
complex form. In the instant case, the foreign
elementconsisted in the fact that private respondent
Morada is a resident Philippinenational, and that
petitioner SAUDIA is a resident foreign corporation.
Also, byvirtue of the employment of Morada with the
petitioner SAUDIA as a flightstewardess, events did
transpire during her many occasions of travel
acrossnational borders, particularly from Manila,
Philippines to Jeddah, Saudi Arabia,and vice versa,
that caused a conflicts situation to arise.The forms
in which a foreign element may appear are many,
such as the fact thatone party is a resident Philippine
national, and that the other is a resident
foreigncorporation. The forms in which this foreign
element may appear are many. Theforeign element
may simply consist in the fact that one of the parties
to a contractis an alien or has a foreign domicile, or
that a contract between nationals of one

right to file it in the QC RTC because under the Rules of

Court, a plaintiff may elect whether to file an action in
personam (case at bar) in the place where she resides or
where the defendant resides. Obviously, it is well within her
right to file the case here because if shell file it in Saudi
Arabia, it will be very disadvantageous for her (and of
course, again, Philippine Civil Law is the law invoked).
Thirdly, one important test factor to determine where to file
a case, if there is a foreign element involved, is the so
called locus actus or where an act has been done. In the
case at bar, Morada was already working in Manila when
she was summoned by her superior to go to Saudi Arabia to
meet with a Saudia Airlinesofficer. She was not informed
that she was going to appear in a court trial. Clearly, she
was defrauded into appearing before a court trial which led
to her wrongful conviction. The act of defrauding, which is
tortuous, was committed in Manila and this led to her
humiliation, misery, and suffering. And applying the torts
principle in a conflicts case, the SC finds that the Philippines
could be said as a situs of the tort (the place where the
alleged tortious conduct took place).

Banco Do Brasil vs Court of Appeals

333 SCRA 545 Conflict of Laws Private International Law
Service of Summons in In Personam Cases
In 1989, Cesar Urbino, Sr. sued Poro Point Shipping Services
for damages the former incurred when one of the latters
ship

ran

aground

causing

losses

to

Urbino.

Urbino

impleaded Banco Do Brasil (BDB), a foreign corporation not

engaged in business in the Philippines nor does it have any
office here or any agent. BDB was impleaded simply
because it has a claim over the sunken ship. BDB however
failed to appear multiple times. Eventually, a judgment was
rendered and BDB was adjudged to pay $300,000.00 in
damages in favor of Urbino for BDB being a nuisance
defendant.
BDB assailed the said decision as it argued that there was
no valid service of summons because the summons was
issued to the ambassador of Brazil. Further, the other
summons which were made through publication is not
applicable to BDB as it alleged that the action against them
is in personam.
ISSUE: Whether or not the court acquired jurisdiction over

State involves properties situated in another State.

In other cases, the foreignelement may assume a
complex form. In the instant case, the foreign
elementconsisted in the fact that private respondent
Morada is a resident Philippinenational, and that
petitioner SAUDIA is a resident foreign corporation.
Also, byvirtue of the employment of Morada with the
petitioner SAUDIA as a flightstewardess, events did
transpire during her many occasions of travel
acrossnational borders, particularly from Manila,
Philippines to Jeddah, Saudi Arabia,and vice versa,
that caused a conflicts situation to arise.Where the
factual antecedents satisfactorily establish the
existence of a foreignelement, the problem could
present
a
conflicts
case.
Where
the
factualantecedents
satisfactorily
establish
the
existence of a foreign element, we agreewith
petitioner that the problem herein could present a
conflicts case. A factualsituation 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 presence of aforeign element is
inevitable since social and economic affairs of
individuals andassociations are rarely confined to
the geographic limits of their birth or conception.

Banco Do Brasil.
HELD: No. Banco Do Brasil is correct. Although the suit is
originally in rem as it was BDBs claim on the sunken ship
which was used as the basis for it being impleaded, the
action nevertheless became an in personam one when
Urbino asked for damages in the said amount. As such, only
a personal service of summons would have vested the court
jurisdiction over BDB. Where the action is in personam, one
brought against a person on the basis of his personal
liability, jurisdiction over the person of the defendant is
necessary for the court to validly try and decide the case.
When the defendant is a non-resident, personal service of
summons within the state is essential to the acquisition of
jurisdiction over the person. This cannot be done, however,
if the defendant is not physically present in the country, and
thus, the court cannot acquire jurisdiction over his person
and therefore cannot validly try and decide the case against
him.

Hasegawa and Nippon Eng. v. Kitamura

Hasegawa and Nippon Eng. v. Kitamura

G.R. No. 149177 November 23, 2007

538 SCRA 261 Conflict of Laws Private International

Law Jurisdiction Lex Loci Celebrationis Lex Loci
Solutionis State of the Most Significant Relationship
Forum Non Conveniens

Ponente: Justice Nachura

Facts:
1. The petitioner Nippon Engineering Consultants Co.
is a Japanese consultancy firm which provides

In March 1999, Nippon Engineering Consultants Co., Ltd, a

technical

Japanese firm, was contracted by the Department of Public

infrastructure project of foreign governments. It

Works and Highways (DPWH) to supervise the construction

entered into a Independent Contractor Agreement

of the Southern Tagalog Access Road. In April 1999, Nippon

(ICA) with respondent Kitamura, a Japanese national

entered into an independent contractor agreement (ICA)

permanently residing in the Philippines. Under the

with Minoru Kitamura for the latter to head the said project.

ICA, the respondent will extend professional services

The ICA was entered into in Japan and is effective for a

to the petitioner for a year.

and

management

support

in

the

period of 1 year (so until April 2000). In January 2000,

DPWH awarded the Bongabon-Baler Road project to Nippon.

2. Subsequently Kitamura was assigned as project

Nippon subsequently assigned Kitamura to head the road

manager of STAR project in 1999. In 2000, he was

project.

Hasegawa,

informed by the petitioner that it will no longer

the general manager of Nippon informed Kitamura that they

renew the ICA and that he will be retained until its

are pre-terminating his contract. Kitamura sought Nippon to

expiration. Kitamura filed a civil casefor specific

reconsider but Nippon refused to negotiate. Kitamura then

performance before the RTC of Lipa and damages.

But

in

February

2000,

Kazuhiro

filed a complaint for specific performance and damages

against Nippon in the RTC of Lipa.

3. The lower court ruled that it has jurisdiction over

the dispute and denied the petitioner's motion to

Hasegawa filed a motion to dismiss on the ground that the

dismiss since accordingly, it is vested by law with

contract was entered in Japan hence, applying the principle

the power to entertain and hear the civil case filed

of lex loci celebracionis, cases arising from the contract

by Kitamura. The Court of Appeals upheld the lower

should be cognizable only by Japanese courts. The trial

court's decision.

court denied the motion. Eventually, Nippon filed a petition

for certiorari with the Supreme Court.

Issue: Whether or not the RTC has jurisdiction

Hasegawa, on appeal significantly changed its theory, this

over the case

time invoking forum non conveniens; that the RTC is an

inconvenient forum because the parties are Japanese

HELD: YES

nationals who entered into a contract in Japan. Kitamura on

the other hand invokes the trial courts ruling which states

1. The only issue is the jurisdiction, hence, choice-of-

that matters connected with the performance of contracts

law rules as raised by the petitioner is inapplicable

are regulated by the law prevailing at the place of

and not yet called for (reference to lex loci, lex

performance, so since the obligations in the ICA are

contractus, or state of most significant rule). The

executed in the Philippines, courts here have jurisdiction.

petitioner prematurelyinvoked the said rules before

pointing out any conflict between the laws of Japan

ISSUE: Whether or not the complaint against Nippon should

and the Philippines.

be dismissed.
HELD: No. The trial court did the proper thing in taking

2. The doctrine on forum non conveniens cannot be

cognizance of it.

invoked to deprive the RTC of its jurisdiction.

In the first place, the case filed by Kitamura is a complaint

for specific performance and damages. Such case is
incapable of pecuniary estimation; such cases are within
the jurisdiction of the regional trial court.
Hasegawa filed his motion to dismiss on the ground of
forum non conveniens. However, such ground is not one of
those provided for by the Rules as a ground for dismissing a
civil case.
The Supreme Court also emphasized that the contention
that Japanese laws should apply is premature. In conflicts
cases, there are three phases and each next phase
commences when one is settled, to wit:
1.

Jurisdiction Where

should

litigation

be

initiated? Court must have jurisdiction over the

subject matter, the parties, the issues, the property,
the res. Also 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.
2.

Choice

of

Law

Which

law

will

the

court

apply? Once a local court takes cognizance, it does

not mean that the local laws must automatically
apply. The court must determine which substantive
law when applied to the merits will be fair to both
parties.
3.

Recognition and Enforcement of Judgment

Where can the resulting judgment be enforced?

This case is not yet in the second phase because upon the
RTCs taking cognizance of the case, Hasegawa immediately
filed a motion to dismiss, which was denied. He filed a
motion for reconsideration, which was also denied. Then he
bypassed the proper procedure by immediately filing a

Dismissing the case on this ground requires a factual

determination hence the principle is considered to
be more a matter of defense.

petition for certiorari. The question of which law should be

applied should have been settled in the trial court had
Hasegawa not improperly appealed the interlocutory order
denying his MFR.

Victoria Regner vs Cynthia Logarta

537 SCRA 277 Conflict of Laws Private International
Law Service of Summons Personal Action Real Action
Extraterritorial Service
Cynthia Logarta and Teresa Tormis were the daughters of
Luis Regner in his first marriage with Anicita Regner. Victoria
Regner is the second wife of Luis.
In 1999, Victoria alleged that Cynthia and Teresa with the
help of another sibling defrauded Luis, who was then very ill
and was unable to write, into placing his thumbmark into a
Deed of Donation. In said Deed, Luis purportedly donated a
Proprietary Ownership Certificate pertaining to membership
shares in the Cebu Country Club. Victoria alleged that said
Deed is void because the placing of thumbmark by Luis was
done without the latters free will and voluntariness
considering his physical state; that it was done without
Luiss lawyer; that the ratification made by Luis before he
died is likewise void because of similar circumstances.
In the same year, Victoria filed a complaint to annul said
deed with the RTC of Cebu. The sheriff could not deliver the
summonses

against

Cynthia

and

Teresa

because

apparently, although they are Filipinos, they are not residing

here; they are residing in California. It was only in the year
2000 that one of the summonses was served to one of the
sisters, Teresa, when she came back to the Philippines.
Teresa immediately filed a motion to dismiss on the ground
that

Victoria

failed

to

prosecute

her

case

for

an

unreasonable length of time. Naturally, Victoria opposed the

MTD. Teresa, in her rejoinder, alleged that the case should
be dismissed because Cynthia, who is an indispensable
party, was not issued any summons, hence, since an
indispensable party is not served with summons, without
her who has such an interest in the controversy or subject
matter there can be no proper determination of the case.
The trial court ruled in favor of Teresa; this was affirmed by
the Court of Appeals.
ISSUE: Whether or not the dismissal of Victorias complaint
is correct.
HELD: Yes. The Supreme Court agreed with the arguments
presented by Teresa. The Supreme Court also emphasized:
There are generally two types of actions: actions in rem and
actions in personam. An action in personam is an action

against a person on the basis of his personal liability, while

an action in rem is an action against the thing itself, instead
of against the person.
The certificate, subject of the donation, is a personal
property. The action filed by Victoria is therefore a personal
action. So in order for the court to acquire jurisdiction over
the

respondents,

summons

must

be

served

upon

them. Further, the certificate is indivisible, Cynthias and

Teresas interests thereto can only be determined if both are
summoned in court.
In personal actions, if the respondents are residents of the
Philippines, they may be served summons in the following
order:
1.

Personal Service;

2.

If (1) is not possible, Substituted Service;

3.

If respondent cant be found because he is abroad

but still a resident of the Philippines, by publication with
leave of court.
In personal actions still, if the respondents are nonresidents, they may be served summons in the following
manner:
1.

Personal service through the Philippine embassy;

2.

By publication in a newspaper of general circulation

in such places and for such time as the court may
order, in which case a copy of the summons and
order of the court should be sent by registered mail
to the last known address of the defendant; or

3.

in any other manner which the court may deem

sufficient.

The above must be with leave of court.

In the case at bar, Cynthia was never served any summons
in any of the manners authorized by the Rules of Court. The
summons served to Teresa cannot bind Cynthia. It is
incumbent upon Victoria to compel the court to authorize
the extraterritorial service of summons against Cynthia.
Her failure to do so for a long period of time constitutes a
failure to prosecute on her part.

Manila Hotel Corporation vs National Labor Relations

Commission343 SCRA 1 Private International Law Forum
Non Conveniens
In May 1988, Marcelo Santos was an overseas worker in
Oman. In June 1988, he was recruited by Palace Hotel in

Beijing, China. Due to higher pay and benefits, Santos

agreed to the hotels job offer and so he started working
there

in

November

1988.

The

employment

contract

between him and Palace Hotel was however without

theintervention of

the Philippine

Overseas

Employment

Administration (POEA). In August 1989, Palace Hotel notified

Santos that he will be laid off due to business reverses. In
September 1989, he was officially terminated.
In February 1990, Santos filed a complaint for illegal
dismissal against Manila Hotel Corporation (MHC) and
Manila Hotel International, Ltd. (MHIL). The Palace Hotel was
impleaded but no summons were served upon it. MHC is a
government owned and controlled corporation. It owns 50%
of MHIL, a foreign corporation (Hong Kong). MHIL manages
the affair of the Palace Hotel. The labor arbiter who handled
the case ruled in favor of Santos. The National Labor
Relations Commission (NLRC) affirmed the labor arbiter.
ISSUE: Whether or not the NLRC has jurisdiction over the
case.
HELD: No. The NLRC is a very inconvenient forum for the
following reasons:
1.

The only link that the Philippines has in this case is

the fact that Santos is a Filipino;

2.

However, the Palace Hotel and MHIL are foreign

corporations MHC cannot be held liable because it merely
owns 50% of MHIL, it has no direct business in the affairs of
the Palace Hotel. The veil of corporate fiction cant be
pierced because it was not shown that MHC is directly
managing the affairs of MHIL. Hence, they are separate
entities.

3.

Santos contract with the Palace Hotel was not

entered into in the Philippines;

4.

Santos

contract

was

entered

into

without

the intervention of the POEA (had POEA intervened, NLRC

still does not have jurisdiction because it will be the POEA
which will hear the case);
5.

MHIL and the Palace Hotel are not doing business in

the Philippines; their agents/officers are not residents of the
Philippines;
Due to the foregoing, the NLRC cannot possibly determine
all the relevant facts pertaining to the case. It is not
competent to determine the facts because the acts
complained of happened outside our jurisdiction. It cannot
determine which law is applicable. And in case a judgment
is rendered, it cannot be enforced against the Palace Hotel

(in the first place, it was not served any summons).

The Supreme Court emphasized that under the rule
of forum non conveniens, a Philippine court or agency may
assume jurisdiction over the case if it chooses to do
so provided:
(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.
None of the above conditions are apparent in the case at
bar.