CONFLICT OF LAWS and CORPORATION LAW

27 August 2016
SIMULATION EXERCISE. This is a simulation exercise. Assume the role of a legal
expert and fully discuss the matters raised by your client. The antecedent facts given
herein shall be your basis. Any fact or stipulation not provided in the facts should be
discussed to your client hypothetically. Apply your knowledge of the laws and
concepts discussed in class, and other legal concepts you have learned in law
school thus far wherever applicable. Your output should be in the form of an essay,
to be written in your blue books.
Team Secret Corporation (hereafter TS CORP) is a foreign tech development
corporation incorporated and registered in Germany. OG Corporation (hereafter OG
Corp) is a domestic corporation incorporated and organized under the laws of the
Republic of the Philippines. It is engaged in the business of refining metal alloys with
its raw materials sourced from mining activities in Southern Mindanao.
During a business summit in Hong Kong, the CEOs of the two corporations met
and discussed their corporate interests and visions. This led to a series of
negotiations, ultimately, a contract signing. At the end of the summit, TS CORP led
by its owner and CEO, Clement Ivanov, entered into a $3 million worth business
agreement with OG Corporation, led by its owner and CEO Johan Sundstein. The
contract involved the manufacturing of four tons of special alloys used for the
development of virtual reality headsets. The contracted period was for a span of four
years.
For the purpose and the entire duration of the contract, TS CORP sent its Chief
Operations Manager, Johan strm, to Manila where OG Corps main office was
based. All communications were coursed through Mr. strm who reported directly
to Mr. Ivanov. In Manila, they coordinated directly to Mr. Sundstein, and in his
absence or unavailibity, to Mr. Kurtis Ling, the Corporate Secretary of OG Corp.
On the first year of the contracted period, all finished products were swiftly
delivered. However, on the first quarter of the second year, the deliveries were
plagued with delays. TS Corp allowed OG Corp to make the necessary adjustments
and did not push for penalties. On the second quarter of the year, however, the same
delays persisted due to the lack of raw materials. For this reason, Mr. strm,
representing his corporation, entered into an agreement signed by the Board of OG

CONFLICT OF LAWS and CORPORATION LAW

Corporation, securing four lots owned by OG Corp. in Tagaytay, as security for any
more financial losses TS Corp will suffer due to the delays brought by OG Corp.
On the third quarter of the year, the new Philippine DENR Secretary order the
closure of all mining activities in Southern Mindanao. This took OG Corp by surprise
and without any recourse, the corporation lost its assets and was forced into
liquidation.
With two more years left of the contract and the losses already assumed by TS
Corp., the corporation decided to proceed against OG Corp. for the losses it sustained
and for all other damages.

The CEO of Team Secret Corporation sought your expertise for the following legal
matters:

1. What case or cases can Team Secret Corporation file against OG Corporation?
Discuss.
2. Can Team Secret Corporation file its case or cases in the Philippines? Discuss
fully.
3. How will OG Corporations liquidation proceedings affect Team Secret
Corporations claim?
4. What possible defenses can be raised by OG Corporation to halt Team Secrets
cases?

CONFLICT OF LAWS and CORPORATION LAW

27 August 2016
SIMULATION EXERCISE. This is a simulation exercise. Assume the role of a legal
expert and fully discuss the matters raised by your client. The antecedent facts given
herein shall be your basis. Any fact or stipulation not provided in the facts should be
discussed to your client hypothetically. Apply your knowledge of the laws and
concepts discussed in class, and other legal concepts you have learned in law
school thus far wherever applicable. Your output should be in the form of an essay,
to be written in your blue books.

Team Secret Corporation (hereafter TS CORP) is a foreign tech development

corporation incorporated and registered in Germany. OG Corporation (hereafter OG
Corp) is a domestic corporation incorporated and organized under the laws of the
Republic of the Philippines. It is engaged in the business of refining metal alloys with
its raw materials sourced from mining activities in Southern Mindanao.
During a business summit in Hong Kong, the CEOs of the two corporations
met and discussed their corporate interests and visions. This led to a series of
negotiations, ultimately, a contract signing. At the end of the summit, TS CORP led
by its owner and CEO, Clement Ivanov, entered into a $3 million worth business
agreement with OG Corporation, led by its owner and CEO Johan Sundstein. The
contract involved the manufacturing of four tons of special alloys used for the
development of virtual reality headsets. The contracted period was for a span of four
years.
For the purpose and the entire duration of the contract, TS CORP sent its
Chief Operations Manager, Johan strm, to Manila where OG Corps main office
was based. All communications were coursed through Mr. strm who reported
directly to Mr. Ivanov. In Manila, they coordinated directly to Mr. Sundstein, and in
his absence or unavailibity, to Mr. Kurtis Ling, the Corporate Secretary of OG Corp.
On the first year of the contracted period, all finished products were swiftly
delivered. However, on the first quarter of the second year, the deliveries were
plagued with delays. TS Corp allowed OG Corp to make the necessary adjustments
and did not push for penalties. On the second quarter of the year, however, the same
delays persisted due to the lack of raw materials. For this reason, Mr. strm,
representing his corporation, entered into an agreement signed by the Board of OG

CONFLICT OF LAWS and CORPORATION LAW

Corporation, securing four lots owned by OG Corp. in Tagaytay, as security for any
more financial losses TS Corp will suffer due to the delays brought by OG Corp.
On the third quarter of the year, the new Philippine DENR Secretary order the
closure of all mining activities in Southern Mindanao. This took OG Corp by surprise
and without any recourse, the corporation lost its assets and was forced into
liquidation.
With two more years left of the contract and the losses already assumed by TS
Corp., the corporation decided to proceed against OG Corp. for the losses it sustained
and for all other damages.

The CEO of OG Corporation sought your expertise for the following legal matters:

1. What case or possible cases should OG Corporation anticipate from Team

Secret Corporation? Discuss.
2. Is Team Secret Corporation correct in filing its case in the Philippines? Why or
why not?
3. Does Team Secret Corporation have a stake in OG Corporations liquidation
proceedings?
4. What are the possible defenses which can be raised against the foreseeable
cases Team Secret Corporation will file?