JURISDICTION OVER THE RES

El Banco Espaol Filipino vs. Palanca, 37 Phil., 921, laid down the following rules:

(1) In order that the court may validly try a case, it must have jurisdiction over the subject-
matter and over the persons of the parties. Jurisdiction over the subject-matter is
acquired by concession of the sovereign authority which organizes a court and
determines the nature and extent of its powers in general and thus fixes its jurisdiction
with reference to actions which it may entertain and the relief it may grant. Jurisdiction
over the persons of the parties is acquired by their voluntary appearance in court and
their submission to its authority, or by the coercive power of legal process exerted over
their persons.

(2) When the defendant is a non-resident and refuses to appear voluntary, the court
cannot acquire jurisdiction over his person even if the summons be served by
publication, for he is beyond the reach of judicial process. No tribunal established by
one State can extend its process beyond its territory so as to subject to its decisions
either persons or property located in another State. It is now fully established that a
personal judgment upon constructive or substituted service against a non-resident who
does not appear is wholly invalid. This doctrine applies to all kinds of constructive or
substituted process, including service by publication and personal service outside of
the jurisdiction in which the judgment is rendered; and the only exception seems to be
found in the case where the non-resident defendant has expressly or impliedly
consented to the mode of service.

(3) The general rule, therefore, is that a suit against a non-resident cannot be entertained
by a Philippine court. Where, however, the action is in rem or quasi in rem in
connection with property located in the Philippines, the court acquires jurisdiction over
the res, and its jurisdiction over the person of the non-resident is non-essential. In order
that the court may exercise power over the res, it is not necessary that the court should
take actual custody of the property, potential custody thereof being sufficient.

(4) As before stated, in an action in rem or quasi in rem against a non-resident defendant,
jurisdiction over his person is non-essential, and if the law requires in such case that
the summons upon the defendant be served by publication, it is merely to satisfy the
constitutional requirement of due process.

A state is helpless when the out of state company operates beyond the borders,
establishes no office in the state, and has no agents, salesmen, or solicitors to obtain
business for it within the state. Then it is beyond the reach of process. Nonetheless this
principle is inapplicable as in the case of Travellers health association, wherein the
Association, although it does not have an office or branch in Virginia nor official agents, it
is still subject to the jurisdiction of Virginia Courts since it did not engage in mere isolated
or short-lived transactions. Its insurance certificates, systematically and widely delivered in
Virginia following solicitation based on recommendations of Virginians, create continuing
obligations between the Association and each of the many certificate holders in the state.
Appellants have caused claims for losses to be investigated, and the Virginia courts were
available to them in seeking to enforce obligations created by the group of certificates.
ACTS OF STATE DOCTRINE

Every sovereign State is bound to respect the independence of every other sovereign
State, and the courts of one country will not sit in judgment on the acts of the government
of another done within its own territory. Redress of grievances by reason of such acts must
be obtained through the means open to be availed of by sovereign powers as between
themselves.

Our courts will not examine a foreign law to determine whether it was adopted in
conformity with the internal procedures and requirements of the enacting state. The act of
state doctrine, it has been well said, is not limited to situations in which "the foreign act is
committed in a manner `colorably valid' under foreign law. It should make no difference
whether the foreign act is, under local law, partially or wholly, technically or fundamentally,
illegal. So long as the act is the act of the foreign sovereign, it matters not how grossly the
sovereign has transgressed its own laws.