Kazuhiro Hasegawa vs Minoru Kitamura

FACTS: In March 1999, Nippon Engineering Consultants Co., Ltd, a Japanese firm, was contracted
by the Department of Public Works and Highways (DPWH) to supervise the construction of the
Southern Tagalog Access Road. In April 1999, Nippon entered into an independent contractor
agreement (ICA) with Minoru Kitamura for the latter to head the said project. The ICA was entered
into in Japan and is effective for a period of 1 year (so until April 2000). In January 2000, DPWH
awarded the Bongabon-Baler Road project to Nippon. Nippon subsequently assigned Kitamura to
head the road project. But in February 2000, Kazuhiro Hasegawa, the general manager of Nippon
informed Kitamura that they are pre-terminating his contract. Kitamura sought Nippon to reconsider
but Nippon refused to negotiate. Kitamura then filed a complaint for specific performance and
.damages against Nippon in the RTC of Lipa
Hasegawa filed a motion to dismiss on the ground that the contract was entered in Japan hence,
applying the principle of lex loci celebracionis, cases arising from the contract should be cognizable
only by Japanese courts. The trial court denied the motion. Eventually, Nippon filed a petition for
.certiorari with the Supreme Court
Hasegawa, on appeal significantly changed its theory, this time invoking forum non conveniens; that
the RTC is an inconvenient forum because the parties are Japanese nationals who entered into a
contract in Japan. Kitamura on the other hand invokes the trial courts ruling which states that matters
connected with the performance of contracts are regulated by the law prevailing at the place of
performance, so since the obligations in the ICA are executed in the Philippines, courts here have
.jurisdiction

.ISSUE: Whether or not the complaint against Nippon should be dismissed

.HELD: No. The trial court did the proper thing in taking cognizance of it
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
Jurisdiction Where should litigation be initiated? Court must have jurisdiction over the subject 1
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
Choice of Law Which law will the court apply? Once a local court takes cognizance, it does 2
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
?Recognition and Enforcement of Judgment Where can the resulting judgment be enforced 3
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 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
BIENVENIDO M. CADALIN, ROLANDO M. AMUL, DONATO B. EVANGELISTA, and the rest of
1,767 NAMED-COMPLAINANTS, thru and by their Attorney-in-fact, Atty. GERARDO A. DEL
MUNDOvs. PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATIONS ADMINISTRATOR,
NLRC, BROWN & ROOT INTERNATIONAL, INC. AND/OR ASIA INTERNATIONAL BUILDERS
CORPORATION
. GRN 104776, December 5,1994

:FACTS
.This is a consolidation of 3 cases of SPECIAL CIVIL ACTIONS in the Supreme Court for Certiorari
On June 6, 1984, Cadalin, Amul and Evangelista, in their own behalf and on behalf of 728 other
OCWs instituted a class suit by filing an Amended Complaint with the POEA for money claims
arising from their recruitment by ASIA INTERNATIONAL BUILDERS CORPORATION (AIBC) and
employment by BROWN & ROOT INTERNATIONAL, INC (BRI) which is a foreign corporation with
headquarters in Houston, Texas, and is engaged in construction; while AIBC is a domestic
corporation licensed as a service contractor to recruit, mobilize and deploy Filipino workers for
.overseas employment on behalf of its foreign principals
The amended complaint sought the payment of the unexpired portion of the employment contracts,
which was terminated prematurely, and secondarily, the payment of the interest of the earnings of the
Travel and Reserved Fund; interest on all the unpaid benefits; area wage and salary differential pay;
fringe benefits; reimbursement of SSS and premium not remitted to the SSS; refund of withholding
tax not remitted to the BIR; penalties for committing prohibited practices; as well as the suspension of
the license of AIBC and the accreditation of BRII
On October 2, 1984, the POEA Administrator denied the Motion to Strike Out of the Records filed by
.AIBC but required the claimants to correct the deficiencies in the complaint pointed out
AIB and BRII kept on filing Motion for Extension of Time to file their answer. The POEA kept on
.granting such motions
On November 14, 1984, claimants filed an opposition to the motions for extension of time and asked
.that AIBC and BRII declared in default for failure to file their answers
On December 27, 1984, the POEA Administrator issued an order directing AIBC and BRII to file their
.answers within ten days from receipt of the order
at madami pang motions ang na-file, new complainants joined the case, ang daming inavail na )
(remedies ng both parties
On June 19, 1987, AIBC finally submitted its answer to the complaint. At the same hearing, the
parties were given a period of 15 days from said date within which to submit their respective position
papers. On February 24, 1988, AIBC and BRII submitted position paper. On October 27, 1988, AIBC
and BRII filed a Consolidated Reply, POEA Adminitartor rendered his decision which awarded the
amount of $824, 652.44 in favor of only 324 complainants. Claimants submitted their Appeal
Memorandum For Partial Appeal from the decision of the POEA. AIBC also filed its MR and/or
.appeal in addition to the Notice of Appeal filed earlier
NLRC promulgated its Resolution, modifying the decision of the POEA. The resolution removed some
of the benefits awarded in favor of the claimants. NLRC denied all the MRs. Hence, these petitions
.filed by the claimants and by AlBC and BRII
The case rooted from the Labor Law enacted by Bahrain where most of the complainants were
deployed. His Majesty Ise Bin Selman Al Kaifa, Amir of Bahrain, issued his Amiri Decree No. 23 on
June 16, 1176, otherwise known re the Labour Law for the Private Sector. Some of the provision of
:Amiri Decree No. 23 that are relevant to the claims of the complainants-appellants are as follows
Art. 79: x x x A worker shall receive payment for each extra hour equivalent to his wage entitlement
increased by a minimum of twenty-rive per centurn thereof for hours worked during the day; and by a
minimum off fifty per centurn thereof for hours worked during the night which shall be deemed to
. being from seven oclock in the evening until seven oclock in the morning
.Art. 80: Friday shall be deemed to be a weekly day of rest on full pay
.If employee worked, 150% of his normal wage shall be paid to him x x x
Art. 81; x x x When conditions of work require the worker to work on any official holiday, he shall be
.paid an additional sum equivalent to 150% of his normal wage
Art. 84: Every worker who has completed one years continuous service with his employer shall be
entitled to Laos on full pay for a period of not less than 21 days for each year increased to a period
.not less than 28 days after five continuous years of service
A worker shall be entitled to such leave upon a quantum meruit in respect of the proportion of his
.service in that year
Art. 107: A contract of employment made for a period of indefinite duration may be terminated by
either party thereto after giving the other party prior notice before such termination, in writing, in
respect of monthly paid workers and fifteen days notice in respect of other workers. The party
terminating a contract without the required notice shall pay to the other party compensation
equivalent to the amount of wages payable to the worker for the period of such notice or the
.unexpired portion thereof
Art. Ill: x x x the employer concerned shall pay to such worker, upon termination of employment, a
leaving indemnity for the period of his employment calculated on the basis of fifteen days wages for
each year of the first three years of service and of one months wages for each year of service
thereafter. Such worker shall be entitled to payment of leaving indemnity upon a quantum meruit in
.proportion to the period of his service completed within a year

:ISSUE
WON the foreign law should govern or the contract of the parties.(WON the complainants who have .1
worked in Bahrain are entitled to the above-mentioned benefits provided by Amiri Decree No. 23 of
.Bahrain)
WON the Bahrain Law should apply in the case. (Assuming it is applicable WON complainants .2
claim for the benefits provided therein have prescribed.)
Whether or not the instant cases qualify as; a class suit (siningit ko nalang) .3
(the rest of the issues in the full text of the case refer to Labor Law )

:RULING
NLRC set aside Section 1, Rule 129 of the 1989 Revised Rules on Evidence governing the .1
pleading and proof of a foreign law and admitted in evidence a simple copy of the Bahrains Amiri
.Decree No. 23 of 1976 (Labour Law for the Private Sector)
NLRC applied the Amiri Deere, No. 23 of 1976, which provides for greater benefits than those
stipulated in the overseas-employment contracts of the claimants. It was of the belief that where the
laws of the host country are more favorable and beneficial to the workers, then the laws of the host
country shall form part of the overseas employment contract. It approved the observation of the
POEA Administrator that in labor proceedings, all doubts in the implementation of the provisions of
.the Labor Code and its implementing regulations shall be resolved in favor of labor
The overseas-employment contracts, which were prepared by AIBC and BRII themselves, provided
that the laws of the host country became applicable to said contracts if they offer terms and
conditions more favorable than those stipulated therein. However there was a part of the employment
contract which provides that the compensation of the employee may be adjusted downward so that
the total computation plus the non-waivable benefits shall be equivalent to the compensation therein
agree, another part of the same provision categorically states that total remuneration and benefits do
.not fall below that of the host country regulation and custom
Any ambiguity in the overseas-employment contracts should be interpreted against AIBC and BRII,
:the parties that drafted it. Article 1377 of the Civil Code of the Philippines provides
The interpretation of obscure words or stipulations in a contract shall not favor the party who caused
.the obscurity
Said rule of interpretation is applicable to contracts of adhesion where there is already a prepared
form containing the stipulations of the employment contract and the employees merely take it or
leave it. The presumption is that there was an imposition by one party against the other and that the
.employees signed the contracts out of necessity that reduced their bargaining power
We read the overseas employment contracts in question as adopting the provisions of the Amiri
Decree No. 23 of 1976 as part and parcel thereof. The parties to a contract may select the law by
which it is to be governed. In such a case, the foreign law is adopted as a system to regulate the
relations of the parties, including questions of their capacity to enter into the contract, the formalities
to be observed by them, matters of performance, and so forth. Instead of adopting the entire mass of
the foreign law, the parties may just agree that specific provisions of a foreign statute shall be
deemed incorporated into their contract as a set of terms. By such reference to the provisions of the
foreign law, the contract does not become a foreign contract to be governed by the foreign law. The
said law does not operate as a statute but as a set of contractual terms deemed written in the
.contract
A basic policy of contract is to protect the expectation of the parties. Such party expectation is
protected by giving effect to the parties own choice of the applicable law. The choice of law must,
however, bear some relationship the parties or their transaction. There is no question that the
contracts sought to be enforced by claimants have a direct connection with the Bahrain law because
.the services were rendered in that country
NLRC ruled that the prescriptive period for the filing of the claims of the complainants was 3 years, .2
as provided in Article 291 of the Labor Code of the Philippines, and not ten years as provided in
Article 1144 of the Civil Code of the Philippines nor one year as provided in the Amiri Decree No. 23
.of 1976
:Article 156 of the Amiri Decree No. 23 of 1976 provides
A claim arising out of a contract of employment shall not actionable after the lapse of one year from
.the date of the expiry of the Contract
As a general rule, a foreign procedural law will not be applied in the forum (local court), Procedural
matters, such as service of process, joinder of actions, period and requisites for appeal, and so forth,
are governed by the laws of the forum. This is true even if the action is based upon a foreign
.substantive law
A law on prescription of actions is sui generis in Conflict of Laws in the sense that it may be viewed
either as procedural or substantive, depending on the characterization given such a law. In Bournias
v. Atlantic Maritime Company (220 F. 2d. 152, 2d Cir. [1955]), where the issue was the applicability of
the Panama Labor Code in a case filed in the State of New York for claims arising from said Code,
the claims would have prescribed under the Panamanian Law but not under the Statute of Limitations
of New York. The U.S. Circuit Court of Appeals held that the Panamanian Law was procedural as it
was not specifically intended to be substantive, hence, the prescriptive period provided in the law of
the forum should apply. The Court observed: . . . we are dealing with a statute of limitations of a
foreign country, and it is not clear on the face of the statute that its purpose was to limit the
enforceability, outside as well as within the foreign country concerned, of the substantive rights to
which the statute pertains. We think that as a yardstick for determining whether that was the purpose,
.this test is the most satisfactory one
The Court further noted: Applying that test here it appears to us that the libellant is entitled to
succeed, for the respondents have failed to satisfy us that the Panamanian period of limitation in
question was specifically aimed against the particular rights which the libellant seeks to enforce. The
Panama Labor Code is a statute having broad objectives. The American court applied the statute of
limitations of New York, instead of the Panamanian law, after finding that there was no showing that
the Panamanian law on prescription was intended to be substantive. Being considered merely a
procedural law even in Panama, it has to give way to the law of the forum (local Court) on prescription
.of actions
However the characterization of a statute into a procedural or substantive law becomes irrelevant
when the country of the forum (local Court) has a borrowing statute. Said statute has the practical
effect of treating the foreign statute of limitation as one of substance. A borrowing statute directs the
state of the forum (local Court) to apply the foreign statute of limitations to the pending claims based
on a foreign law. While there are several kinds of borrowing statutes, one form provides that an
action barred by the laws of the place where it accrued will not be enforced in the forum even though
.the local statute was not run against it
Section 48 of Code of Civil Procedure is of this kind. It provides: If by the laws of the state or country
.where the cause of action arose, the action is barred, it is also barred in the Philippine Islands
Section 48 has not been repealed or amended by the Civil Code of the Philippines. In the light of the
1987 Constitution, however, Section 48 cannot be enforced ex proprio vigore insofar as it ordains the
.application in this jurisdiction of Section 156 of the Amiri Decree No. 23 of 1976
The courts of the forum (local Court) will not enforce any foreign claim obnoxious to the forums public
policy. To enforce the one-year prescriptive period of the Amiri Decree No. 23 of 1976 as regards the
.claims in question would contravene the public policy on the protection to labor
In the Declaration of Principles and State Policies, the 1987 Constitution emphasized that:The state
.shall promote social justice in all phases of national development (Sec. 10)
The state affirms labor as a primary social economic force. It shall protect the rights of workers and
.promote their welfare (Sec. 18)
:In Article XIII on Social Justice and Human Rights, the 1987 Constitution provides
Sec. 3. The State shall afford full protection to labor, local and overseas, organized and unorganized,
.and promote full employment and equality of employment opportunities for all
.Thus, the applicable law on prescription is the Philippine law
The next question is whether the prescriptive period governing the filing of the claims is 3 years, as
.provided by the Labor Code or 10 years, as provided by the Civil Code of the Philippines
:Article 1144 of the Civil Code of the Philippines provides
:The following actions must be brought within ten years from the time the right of action accross
Upon a written contract; (2) Upon an obligation created by law; (3) Upon a judgment (1)
In this case, the claim for pay differentials is primarily anchored on the written contracts between the
.litigants, the ten-year prescriptive period provided by Art. 1144(l) of the New Civil Code should govern
NO. A class suit is proper where the subject matter of the controversy is one of common or general .3
interest to many and the parties are so numerous that it is impracticable to bring them all before the
court. When all the claims are for benefits granted under the Bahrain law many of the claimants
worked outside Bahrain. Some of the claimants were deployed in Indonesia under different terms and
.condition of employment
Inasmuch as the First requirement of a class suit is not present (common or general interest based on
the Amiri Decree of the State of Bahrain), it is only logical that only those who worked in Bahrain shall
.be entitled to rile their claims in a class suit
While there are common defendants (AIBC and BRII) and the nature of the claims is the same (for
employees benefits), there is no common question of law or fact. While some claims are based on
the Amiri Law of Bahrain, many of the claimants never worked in that country, but were deployed
elsewhere. Thus, each claimant is interested only in his own demand and not in the claims of the
other employees of defendants. A claimant has no concern in protecting the interests of the other
claimants as shown by the fact, that hundreds of them have abandoned their co-claimants and have
entered into separate compromise settlements of their respective claims. The claimants who worked
.in Bahrain can not be allowed to sue in a class suit in a judicial proceeding
.WHEREFORE, all the three petitioners are DISMISSED

THE GOVT OF THE PHILIPPINE ISLANDS vs. FRANK

G. R. No. 2935
March 23, 1909

FACTS: In 1903, in the city of Chicago, Illinois, Frank entered into a contract for a period of 2 years
with the Plaintiff, by which Frank was to receive a salary as a stenographer in the service of the said
Plaintiff, and in addition thereto was to be paid in advance the expenses incurred in traveling from the
.said city of Chicago to Manila, and one-half salary during said period of travel
Said contract contained a provision that in case of a violation of its terms on the part of Frank, he
should become liable to the Plaintiff for the amount expended by the Government by way of expenses
.incurred in traveling from Chicago to Manila and the one-half salary paid during such period
Frank entered upon the performance of his contract and was paid half-salary from the date until the
.date of his arrival in the Philippine Islands
Thereafter, Frank left the service of the Plaintiff and refused to make a further compliance with the
.terms of the contract
The Plaintiff commenced an action in the CFI-Manila to recover from Frank the sum of money, which
amount the Plaintiff claimed had been paid to Frank as expenses incurred in traveling from Chicago
.to Manila, and as half-salary for the period consumed in travel
It was expressly agreed between the parties to said contract that Laws No. 80 and No. 224 should
.constitute a part of said contract
The Defendant filed a general denial and a special defense, alleging in his special defense that
the Government of the Philippine Islands had amended Laws No. 80 and No. 224 and had thereby (1)
materially altered the said contract, and also that
he was a minor at the time the contract was entered into and was therefore not responsible under (2)
.the law
the lower court rendered a judgment against Frank and in favor of the Plaintiff for the sum of 265. 90
dollars

:ISSUE
Did the amendment of the laws altered the tenor of the contract entered into between Plaintiff and .1
?Defendant
?Can the defendant allege minority/infancy .2

HELD: the judgment of the lower court is affirmed

NO; It may be said that the mere fact that the legislative department of the Government of the .1
Philippine Islands had amended said Acts No. 80 and No. 224 by Acts No. 643 and No. 1040 did not
have the effect of changing the terms of the contract made between the Plaintiff and the Defendant.
The legislative department of the Government is expressly prohibited by section 5 of the Act of
Congress of 1902 from altering or changing the terms of a contract. The right which the Defendant
had acquired by virtue of Acts No. 80 and No. 224 had not been changed in any respect by the fact
that said laws had been amended. These acts, constituting the terms of the contract, still constituted
.a part of said contract and were enforceable in favor of the Defendant
NO; The Defendant alleged in his special defense that he was a minor and therefore the contract .2
could not be enforced against him. The record discloses that, at the time the contract was entered
into in the State of Illinois, he was an adult under the laws of that State and had full authority to
contract. Frank claims that, by reason of the fact that, under that laws of the Philippine Islands at the
time the contract was made, made persons in said Islands did not reach their majority until they had
attained the age of 23 years, he was not liable under said contract, contending that the laws of the
.Philippine Islands governed
It is not disputed upon the contrary the fact is admitted that at the time and place of the making
of the contract in question the Defendant had full capacity to make the same. No rule is better settled
in law than that matters bearing upon the execution, interpretation and validity of a contract are
determined b the law of the place where the contract is made. Matters connected with its
performance are regulated by the law prevailing at the place of performance. Matters respecting a
remedy, such as the bringing of suit, admissibility of evidence, and statutes of limitations, depend
.upon the law of the place where the suit is brought

TESTATE ESTATE OF EDWARD E. CHRISTENSEN vs. HELEN CHRISTENSEN GARCIA, G.R.

No. L-16749 January 31, 1963

. IN THE MATTER OF THE TESTATE ESTATE OF EDWARD E. CHRISTENSEN, DECEASED

ADOLFO C. AZNAR, Executor and LUCY CHRISTENSEN, Heir of the deceased, Executor and
Heir-appellees, VS. HELEN CHRISTENSEN GARCIA, oppositor-appellant
January 31, 1963

:FACTS
Edward E. Christensen, though born in New York, migrated to California, where he resided and
consequently was considered a California citizen. In 1913, he came to the Philippines where he
became a domiciliary until his death. However, during the entire period of his residence in this country
he had always considered himself a citizen of California. In his will executed on March 5, 1951, he
instituted an acknowledged natural daughter, Maria Lucy Christensen as his only heir, but left a
legacy of sum of money in favor of Helen Christensen Garcia who was rendered to have been
declared acknowledged natural daughter. Counsel for appellant claims that California law should be
applied; that under California law, the matter is referred back to the law of the domicile; that therefore
Philippine law is ultimately applicable; that finally, the share of Helen must be increased in view of the
success ional rights of illegitimate children under Philippine law. On the other hand, counsel for the
heir of Christensen contends that inasmuch as it is clear that under Article 16 of our Civil Code, the
national law of the deceased must apply, our courts must immediately apply the internal law of
California on the matter; that under California law there are no compulsory heirs and consequently a
testator could dispose of any property possessed by him in absolute dominion and that finally,
.illegitimate children not being entitled to anything and his will remain undisturbed

:ISSUE
?Whether or not the Philippine law should prevail in administering the estate of Christensen
:RULING
The court in deciding to grant more successional rights to Helen said in effect that there are two rules
in California on the matter: the internal law which should apply to Californians domiciled in California;
and the conflict rule which should apply to Californians domiciled outside of California. The California
conflict rule says: If there is no law to the contrary in the place where personal property is situated, is
deemed to follow the person of its owner and is governed by the law of his domicile. Christensen
being domiciled outside California, the law of his domicile, the Philippines, ought to be followed.
Where it is referred back to California, it will form a circular pattern referring to both country back and
.forth

Bellis vs Bellis, G.R. No. L-23678 June 6, 1967

,TESTATE ESTATE OF AMOS G. BELLIS, deceased, PEOPLES BANK & TRUST COMPANY
.executor, MARIA CRISTINA BELLIS and MIRIAM PALMA BELLIS, oppositors-appellants, VS
EDWARD A. BELLIS, ET. AL., heir-appellees
G.R. No. L-23678 June 6, 1967

:FACTS
Amos Bellis, born in Texas, was a citizen of the State of Texas and of the United States. He had 5
legitimate children with his wife, Mary Mallen, whom he had divorced, 3 legitimate children with his
.2nd wife, Violet Kennedy and finally, 3 illegitimate children

Prior to his death, Amos Bellis executed a will in the Philippines in which his distributable estate
:should be divided in trust in the following order and manner

;a. $240,000 to his 1st wife Mary Mallen

;b. P120,000 to his 3 illegitimate children at P40,000 each
.c. The remainder shall go to his surviving children by his 1st and 2nd wives, in equal shares

Subsequently, Amos Bellis died a resident of San Antonio, Texas, USA. His will was admitted to
probate in the Philippines. The Peoples Bank and Trust Company, an executor of the will, paid the
.entire bequest therein

Preparatory to closing its administration, the executor submitted and filed its Executors Final
Account, Report of Administration and Project of Partition where it reported, inter alia, the satisfaction
of the legacy of Mary Mallen by the shares of stock amounting to $240,000 delivered to her, and the
legacies of the 3 illegitimate children in the amount of P40,000 each or a total of P120,000. In the
project partition, the executor divided the residuary estate into 7 equal portions
.for the benefit of the testators 7 legitimate children by his 1st and 2nd marriages

Among the 3 illegitimate children, Mari Cristina and Miriam Palma Bellis filed their respective
opposition to the project partition on the ground that they were deprived of their legitimates as
.illegitimate children

.The lower court denied their respective motions for reconsideration

:ISSUE
.Whether Texan Law of Philippine Law must apply

:RULING
It is not disputed that the decedent was both a national of Texas and a domicile thereof at the time of
his death. So that even assuming Texan has a conflict of law rule providing that the same would not
.result in a reference back (renvoi) to Philippine Law, but would still refer to Texas Law

Nonetheless, if Texas has conflict rule adopting the situs theory (lex rei sitae) calling for the
application of the law of the place where the properties are situated, renvoi would arise, since the
properties here involved are found in the Philippines. In the absence, however of proofs as to the
conflict of law rule of Texas, it should not be presumed different from our appellants, position is
.therefore not rested on the doctrine of renvoi

The parties admit that the decedent, Amos Bellis, was a citizen of the State of Texas, USA and that
under the Laws of Texas, there are no forced heirs or legitimates. Accordingly, since the intrinsic
validity of the provision of the will and the amount of successional rights has to be determined under
.Texas Law, the Philippine Law on legitimates can not be applied to the testate of Amos Bellis

LLORENTE vs. CA, G.R. No. 124371. November 23, 2000

, PAULA T. LLORENTE, petitioner, VS. COURT OF APPEALS and ALICIA F. LLORENTE

respondents
November 23, 2000

:FACTS
Lorenzo Llorente and petitioner Paula Llorente were married in 1937 in the Philippines. Lorenzo was
an enlisted serviceman of the US Navy. Soon after, he left for the US where through naturalization, he
became a US Citizen. Upon his visitation of his wife, he discovered that she was living with his
brother and a child was born. The child was registered as legitimate but the name of the father was
left blank. Llorente filed a divorce in California, which later on became final. He married Alicia and
they lived together for 25 years bringing 3 children. He made his last will and testament stating that all
his properties will be given to his second marriage. He filed a petition of probate that made or
appointed Alicia his special administrator of his estate. Before the
proceeding could be terminated, Lorenzo died. Paula filed a letter of administration over
Llorentes estate. The trial granted the letter and denied the motion for reconsideration. An
appeal was made to the Court of Appeals, which affirmed and modified the judgment of the
Trial Court that she be declared co-owner of whatever properties, she and the deceased, may
.have acquired during their 25 years of cohabitation

:ISSUE
.Whether or not the National Law shall apply

:RULING
Lorenzo Llorente was already an American citizen when he divorced Paula. Such was also the
situation when he married Alicia and executed his will. As stated in Article 15 of the civil code, aliens
may obtain divorces abroad, provided that they are validly required in their National Law. Thus the
divorce obtained by Llorente is valid because the law that governs him is not Philippine Law but his
National Law since the divorce was contracted after he became an American citizen. Furthermore, his
.National Law allowed divorce
The case was remanded to the court of origin for determination of the intrinsic validity of Lorenzo
.Llorentes will and determination of the parties successional rights allowing proof of foreign law

MHC AND MHICL vs. NLRC et al

G.R. No. 120077
October 13, 2000

FACTS: private respondent Santos was an overseas worker employed as a printer at the Mazoon
Printing Press, Sultanate of Oman. Subsequently he was directly hired by the Palace Hotel, Beijing,
.Peoples Republic of China and later terminated due to retrenchment
Petitioners are the Manila Hotel Corporation (MHC) and the Manila Hotel International Company,
.Limited (MHICL)
When the case was filed in 1990, MHC was still a government-owned and controlled corporation duly
organized and existing under the laws of the Philippines. MHICL is a corporation duly organized and
existing under the laws of Hong Kong. MHC is an incorporator of MHICL, owning 50% of its capital
.stock
By virtue of a management agreement with the Palace Hotel, MHICL trained the personnel and staff
.of the Palace Hotel at Beijing, China
.Now the facts
During his employment with the Mazoon Printing Press, respondent Santos received a letter from Mr.
Shmidt, General Manager, Palace Hotel, Beijing, China. Mr. Schmidt informed respondent Santos that
he was recommended by one Buenio, a friend of his. Mr. Shmidt offered respondent Santos the same
position as printer, but with a higher monthly salary and increased benefits. Respondent Santos wrote
.to Mr. Shmidt and signified his acceptance of the offer
The Palace Hotel Manager, Mr. Henk mailed a ready to sign employment contract to respondent
Santos. Santos resigned from the Mazoon Printing Press. Santos wrote the Palace Hotel and
acknowledged Mr. Henks letter. The employment contract stated that his employment would be for a
.period of two years. He then started to work at the Palace Hotel
Subsequently, respondent Santos signed an amended employment agreement with the Palace
Hotel. In the contract, Mr. Shmidt represented the Palace Hotel. The Vice President (Operations and
Development) of petitioner MHICL Cergueda signed the employment agreement under the word
.noted
After working in the Palace hotel for less than 1 year, the Palace Hotel informed respondent Santos
by letter signed by Mr. Shmidt that his employment at the Palace Hotel print shop would be
terminated due to business reverses brought about by the political upheaval in China. The Palace
Hotel terminated the employment of Santos and paid all benefits due him, including his plane fare
.back to the Philippines. Santos was repatriated to the Philippines
Santos filed a complaint for illegal dismissal with the Arbitration Branch, NCR, NLRC. He prayed for
an award of AD, ED and AF for. The complaint named MHC, MHICL, the Palace Hotel and Mr. Shmidt
as respondents. The Palace Hotel and Mr. Shmidt were not served with summons and neither
.participated in the proceedings before the LA
The LA decided the case against petitioners. Petitioners appealed to the NLRC, arguing that the
POEA, not the NLRC had jurisdiction over the case. The NLRC promulgated a resolution, stating that
the appealed Decision be declared null and void for want of jurisdiction
Santos moved for reconsideration of the afore-quoted resolution. He argued that the case was not
cognizable by the POEA as he was not an overseas contract worker. The NLRC granted the motion
and reversed itself. The NLRC directed another LA to hear the case on the question of whether
private respondent was retrenched or dismissed. The La found that Santos was illegally dismissed
from employment and recommended that he be paid actual damages equivalent to his salaries for the
unexpired portion of his contract. The NLRC ruled in favor of private respondent. Petitioners filed an
MR arguing that the LAs recommendation had no basis in law and in fact, however it was denied.
.Hence, this petition

?ISSUE: Is the NLRC a proper forum to decide this case

.HELD: petition granted; the orders and resolutions of the NLRC are annulled
NO
Forum Non-Conveniens
.The NLRC was a seriously inconvenient forum
We note that the main aspects of the case transpired in two foreign jurisdictions and the case
involves purely foreign elements. The only link that the Philippines has with the case is that Santos is
a Filipino citizen. The Palace Hotel and MHICL are foreign corporations. Not all cases involving our
.citizens can be tried here
The employment contract. Respondent Santos was hired directly by the Palace Hotel, a foreign
employer, through correspondence sent to the Sultanate of Oman, where respondent Santos was
then employed. He was hired without the intervention of the POEA or any authorized recruitment
.agency of the government
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. The conditions are unavailing in the case at bar
Not Convenient. We fail to see how the NLRC is a convenient forum given that all the incidents of
the case from the time of recruitment, to employment to dismissal occurred outside the Philippines.
The inconvenience is compounded by the fact that the proper defendants, the Palace Hotel and
MHICL are not nationals of the Philippines. Neither .are they doing business in the Philippines.
.Likewise, the main witnesses, Mr. Shmidt and Mr. Henk are non-residents of the Philippines
No power to determine applicable law. Neither can an intelligent decision be made as to the law
governing the employment contract as such was perfected in foreign soil. This calls to fore the
.application of the principle of lex loci contractus (the law of the place where the contract was made)
The employment contract was not perfected in the Philippines. Santos signified his acceptance by
writing a letter while he was in the Republic of Oman. This letter was sent to the Palace Hotel in the
.Peoples Republic of China
No power to determine the facts. Neither can the NLRC determine the facts surrounding the
alleged illegal dismissal as all acts complained of took place in Beijing, People s Republic of China.
The NLRC was not in a position to determine whether the Tiannamen Square incident truly adversely
.affected operations of the Palace Hotel as to justify Santos retrenchment
Principle of effectiveness, no power to execute decision. Even assuming that a proper decision
could be reached by the NLRC, such would not have any binding effect against the employer, the
Palace Hotel. The Palace Hotel is a corporation incorporated under the laws of China and was not
.even served with summons. Jurisdiction over its person was not acquired
This is not to say that Philippine courts and agencies have no power to solve controversies involving
foreign employers. Neither are we saying that we do not have power over an employment contract
executed in a foreign country. If Santos were an overseas contract worker, a Philippine forum,
specifically the POEA, not the NLRC, would protect him. He is not an overseas contract worker a
.fact which he admits with conviction
__
Even assuming that the NLRC was the proper forum, even on the merits, the NLRCs decision cannot
.be sustained
II. MHC Not Liable
Even if we assume two things: (1) that the NLRC had jurisdiction over the case, and (2) that MHICL
was liable for Santos retrenchment, still MHC, as a separate and distinct juridical entity cannot be
.held liable
True, MHC is an incorporator of MHICL and owns 50% of its capital stock. However, this is not
enough to pierce the veil of corporate fiction between MHICL and MHC. In Traders Royal Bank v. CA,
we held that the mere ownership by a single stockholder or by another corporation of all or nearly all
of the capital stock of a corporation is not of itself a sufficient reason for disregarding the fiction of
.separate corporate personalities
It is basic that a corporation has a personality separate and distinct from those composing it as well
as from that of any other legal entity to which it may be related. Clear and convincing evidence is
needed to pierce the veil of corporate fiction. In this case, we find no evidence to show that MHICL
.and MHC are one and the same entity
III. MHICL not Liable
Santos predicates MHICLs liability on the fact that MHICL signed his employment contract with the
.Palace Hotel. This fact fails to persuade us
First, we note that the Vice President (Operations and Development) of MHICL, Cergueda signed the
.employment contract as a mere witness. He merely signed under the word noted
When one notes a contract, one is not expressing his agreement or approval, as a party would. In
Sichangco v. Board of Commissioners of Immigration, the Court recognized that the term noted
means that the person so noting has merely taken cognizance of the existence of an act or
.declaration, without exercising a judicious deliberation or rendering a decision on the matter
Second, and more importantly, there was no existing employer-employee relationship between
Santos and MHICL. In determining the existence of an employer-employee relationship, the following
:elements are considered
;the selection and engagement of the employee (1)
;the payment of wages (2)
the power to dismiss; and (3)
.the power to control employees conduct (4)
MHICL did not have and did not exercise any of the aforementioned powers. It did not select
respondent Santos as an employee for the Palace Hotel. He was referred to the Palace Hotel by his
friend, Buenio. MHICL did not engage respondent Santos to work. The terms of employment were
negotiated and finalized through correspondence between Santos, Mr. Schmidt and Mr. Henk, who
were officers and representatives of the Palace Hotel and not MHICL. Neither did Santos adduce any
proof that MHICL had the power to control his conduct. Finally, it was the Palace Hotel, through Mr.
.Schmidt and not MHICL that terminated respondent Santos services
Likewise, there is no evidence to show that the Palace Hotel and MHICL are one and the same entity.
The fact that the Palace Hotel is a member of the Manila Hotel Group is not enough to pierce the
.corporate veil between MHICL and the Palace Hotel
Considering that the NLRC was forum non-conveniens and considering further that no employer-
employee relationship existed between MHICL, MHC and Santos, the LA clearly had no jurisdiction
over respondents claim in the NLRC case. In all the cases under the exclusive and original
jurisdiction of the LA, an employer-employee relationship is an indispensable jurisdictional
.requirement

. COMMUNICATION MATERIALS AND DESIGN, INC et al vs.CA et al

G.R. No. 102223
August 22, 1996

FACTS: Petitioners COMMUNICATION MATERIALS AND DESIGN, INC., (CMDI) and ASPAC
MULTI-TRADE INC., (ASPAC) are both domestic corporations.. Private Respondents ITEC, INC.
and/or ITEC, INTERNATIONAL, INC. (ITEC) are corporations duly organized and existing under the
laws of the State of Alabama, USA. There is no dispute that ITEC is a foreign corporation not licensed
.to do business in the Philippines
ITEC entered into a contract with ASPAC referred to as Representative Agreement. Pursuant to the
contract, ITEC engaged ASPAC as its exclusive representative in the Philippines for the sale of
ITECs products, in consideration of which, ASPAC was paid a stipulated commission. Through a
License Agreement entered into by the same parties later on, ASPAC was able to incorporate and
use the name ITEC in its own name. Thus , ASPAC Multi-Trade, Inc. became legally and publicly
.known as ASPAC-ITEC (Philippines)
One year into the second term of the parties Representative Agreement, ITEC decided to terminate
the same, because petitioner ASPAC allegedly violated its contractual commitment as stipulated in
their agreements. ITEC charges the petitioners and another Philippine Corporation, DIGITAL BASE
COMMUNICATIONS, INC. (DIGITAL), the President of which is likewise petitioner Aguirre, of using
knowledge and information of ITECs products specifications to develop their own line of equipment
and product support, which are similar, if not identical to ITECs own, and offering them to ITECs
.former customer
The complaint was filed with the RTC-Makati by ITEC, INC. Defendants filed a MTD the complaint on
the following grounds: (1) That plaintiff has no legal capacity to sue as it is a foreign corporation doing
business in the Philippines without the required BOI authority and SEC license, and (2) that plaintiff is
simply engaged in forum shopping which justifies the application against it of the principle of forum
.non conveniens. The MTD was denied
Petitioners elevated the case to the respondent CA on a Petition for Certiorari and Prohibition under
Rule 65 of the Revised ROC. It was dismissed as well. MR denied, hence this Petition for Review on
.Certiorari under Rule 45

:ISSUE
Did the Philippine court acquire jurisdiction over the person of the petitioner corp, despite .1
?allegations of lack of capacity to sue because of non-registration
Can the Philippine court give due course to the suit or dismiss it, on the principle of forum non .2
?convenience

.HELD: petition dismissed

YES; We are persuaded to conclude that ITEC had been engaged in or doing business in the .1
Philippines for some time now. This is the inevitable result after a scrutiny of the different contracts
and agreements entered into by ITEC with its various business contacts in the country. Its
arrangements, with these entities indicate convincingly that ITEC is actively engaging in business in
.the country
A foreign corporation doing business in the Philippines may sue in Philippine Courts although not
authorized to do business here against a Philippine citizen or entity who had contracted with and
benefited by said corporation. To put it in another way, a party is estopped to challenge the
personality of a corporation after having acknowledged the same by entering into a contract with it.
And the doctrine of estoppel to deny corporate existence applies to a foreign as well as to domestic
corporations. One who has dealt with a corporation of foreign origin as a corporate entity is estopped
.to deny its corporate existence and capacity
In Antam Consolidated Inc. vs. CA et al. we expressed our chagrin over this commonly used scheme
of defaulting local companies which are being sued by unlicensed foreign companies not engaged in
business in the Philippines to invoke the lack of capacity to sue of such foreign companies. Obviously,
the same ploy is resorted to by ASPAC to prevent the injunctive action filed by ITEC to enjoin
petitioner from using knowledge possibly acquired in violation of fiduciary arrangements between the
.parties
YES; Petitioners insistence on the dismissal of this action due to the application, or non application, .2
of the private international law rule of forum non conveniens defies well-settled rules of fair play.
According to petitioner, the Philippine Court has no venue to apply its discretion whether to give
cognizance or not to the present action, because it has not acquired jurisdiction over the person of
the plaintiff in the case, the latter allegedly having no personality to sue before Philippine Courts. This
argument is misplaced because the court has already acquired jurisdiction over the plaintiff in the suit,
by virtue of his filing the original complaint. And as we have already observed, petitioner is not at
liberty to question plaintiffs standing to sue, having already acceded to the same by virtue of its entry
.into the Representative Agreement referred to earlier
Thus, having acquired jurisdiction, it is now for the Philippine Court, based on the facts of the case,
whether to give due course to the suit or dismiss it, on the principle of forum non convenience.
Hence, the Philippine Court may refuse to assume jurisdiction in spite of its having acquired
jurisdiction. Conversely, the court may assume jurisdiction over the case if it chooses to do so;
:provided, that the following requisites are met
;That the Philippine Court is one to which the parties may conveniently resort to (1
That the Philippine Court is in a position to make an intelligent decision as to the law and the facts; (2
,and
.That the Philippine Court has or is likely to have power to enforce its decision (3
The aforesaid requirements having been met, and in view of the courts disposition to give due course
to the questioned action, the matter of the present forum not being the most convenient as a ground
.for the suits dismissal, deserves scant consideration

PHILSEC INVESTMENT et al vs.CA et al

G.R. No. 103493
June 19, 1997

FACTS: Private respondent Ducat obtained separate loans from petitioners Ayala International
Finance Limited (AYALA) and Philsec Investment Corp (PHILSEC), secured by shares of stock
.owned by Ducat
In order to facilitate the payment of the loans, private respondent 1488, Inc., through its president,
private respondent Daic, assumed Ducats obligation under an Agreement, whereby 1488, Inc.
executed a Warranty Deed with Vendors Lien by which it sold to petitioner Athona Holdings, N.V.
(ATHONA) a parcel of land in Texas, U.S.A., while PHILSEC and AYALA extended a loan to ATHONA
as initial payment of the purchase price. The balance was to be paid by means of a promissory note
executed by ATHONA in favor of 1488, Inc. Subsequently, upon their receipt of the money from 1488,
Inc., PHILSEC and AYALA released Ducat from his indebtedness and delivered to 1488, Inc. all the
.shares of stock in their possession belonging to Ducat
As ATHONA failed to pay the interest on the balance, the entire amount covered by the note became
due and demandable. Accordingly, private respondent 1488, Inc. sued petitioners PHILSEC, AYALA,
and ATHONA in the United States for payment of the balance and for damages for breach of contract
and for fraud allegedly perpetrated by petitioners in misrepresenting the marketability of the shares of
.stock delivered to 1488, Inc. under the Agreement
While the Civil Case was pending in the United States, petitioners filed a complaint For Sum of
Money with Damages and Writ of Preliminary Attachment against private respondents in the RTC
Makati. The complaint reiterated the allegation of petitioners in their respective counterclaims in the
Civil Action in the United States District Court of Southern Texas that private respondents committed
.fraud by selling the property at a price 400 percent more than its true value
Ducat moved to dismiss the Civil Case in the RTC-Makati on the grounds of (1) litis pendentia, vis-a-
vis the Civil Action in the U.S., (2) forum non conveniens, and (3) failure of petitioners PHILSEC and
.BPI-IFL to state a cause of action
The trial court granted Ducats MTD, stating that the evidentiary requirements of the controversy may
be more suitably tried before the forum of the litis pendentia in the U.S., under the principle in private
international law of forum non conveniens, even as it noted that Ducat was not a party in the U.S.
.case
Petitioners appealed to the CA, arguing that the trial court erred in applying the principle of litis
.pendentia and forum non conveniens
The CA affirmed the dismissal of Civil Case against Ducat, 1488, Inc., and Daic on the ground of litis
.pendentia

?ISSUE: is the Civil Case in the RTC-Makati barred by the judgment of the U.S. court

HELD: CA reversed. Case remanded to RTC-Makati

NO
While this Court has given the effect of res judicata to foreign judgments in several cases, it was after
the parties opposed to the judgment had been given ample opportunity to repel them on grounds
allowed under the law. This is because in this jurisdiction, with respect to actions in personam, as
distinguished from actions in rem, a foreign judgment merely constitutes prima facie evidence of the
:justness of the claim of a party and, as such, is subject to proof to the contrary. Rule 39, 50 provides
Sec. 50. Effect of foreign judgments. The effect of a judgment of a tribunal of a foreign country,
:having jurisdiction to pronounce the judgment is as follows
;In case of a judgment upon a specific thing, the judgment is conclusive upon the title to the thing (a)
In case of a judgment against a person, the judgment is presumptive evidence of a right as (b)
between the parties and their successors in interest by a subsequent title; but the judgment may be
repelled by evidence of a want of jurisdiction, want of notice to the party, collusion, fraud, or clear
.mistake of law or fact
In the case at bar, it cannot be said that petitioners were given the opportunity to challenge the
judgment of the U.S. court as basis for declaring it res judicata or conclusive of the rights of private
respondents. The proceedings in the trial court were summary. Neither the trial court nor the appellate
court was even furnished copies of the pleadings in the U.S. court or apprised of the evidence
presented thereat, to assure a proper determination of whether the issues then being litigated in the
U.S. court were exactly the issues raised in this case such that the judgment that might be rendered
.would constitute res judicata
Second. Nor is the trial courts refusal to take cognizance of the case justifiable under the principle of
:forum non conveniens
First, a MTD is limited to the grounds under Rule 16, sec.1, which does not include forum non
conveniens. The propriety of dismissing a case based on this principle requires a factual
.determination, hence, it is more properly considered a matter of defense
Second, while it is within the discretion of the trial court to abstain from assuming jurisdiction on this
ground, it should do so only after vital facts are established, to determine whether special
.circumstances require the courts desistance

HONGKONG AND SHANGHAI BANKING CORPORATION (HSBC) vs. SHERMAN et al

G.R. No. 72494
August 11, 1989

FACTS: It appears that sometime in 1981, Eastern Book Supply Service PTE, Ltd. (COMPANY), a
company incorporated in Singapore applied with and was granted by HSBC Singapore branch an
overdraft facility in the maximum amount of Singapore dollars 200,000 with interest at 3% over HSBC
.prime rate, payable monthly, on amounts due under said overdraft facility
As a security for the repayment by the COMPANY of sums advanced by HSBC to it through the
aforesaid overdraft facility, in 1982, both private respondents and a certain Lowe, all of whom were
directors of the COMPANY at such time, executed a Joint and Several Guarantee in favor of HSBC
whereby private respondents and Lowe agreed to pay, jointly and severally, on demand all sums
.owed by the COMPANY to petitioner BANK under the aforestated overdraft facility
:The Joint and Several Guarantee provides, inter alia, that
This guarantee and all rights, obligations and liabilities arising hereunder shall be construed and
determined under and may be enforced in accordance with the laws of the Republic of Singapore. We
hereby agree that the Courts of Singapore shall have jurisdiction over all disputes arising under this
.guarantee
The COMPANY failed to pay its obligation. Thus, HSBC demanded payment and inasmuch as the
private respondents still failed to pay, HSBC filed A complaint for collection of a sum of money against
.private respondents Sherman and Reloj before RTC of Quezon City
Private respondents filed an MTD on the ground of lack of jurisdiction over the subject matter. The
trial court denied the motion. They then filed before the respondent IAC a petition for prohibition with
preliminary injunction and/or prayer for a restraining order. The IAC rendered a decision enjoining the
RTC Quezon City from taking further cognizance of the case and to dismiss the same for filing with
.the proper court of Singapore which is the proper forum. MR denied, hence this petition

ISSUE: Do Philippine courts have jurisdiction over the suit, vis-a-vis the Guarantee stipulation
?regarding jurisdiction

HELD: YES
One basic principle underlies all rules of jurisdiction in International Law: a State does not have
jurisdiction in the absence of some reasonable basis for exercising it, whether the proceedings are in
rem quasi in rem or in personam. To be reasonable, the jurisdiction must be based on some minimum
contacts that will not offend traditional notions of fair play and substantial justice
The defense of private respondents that the complaint should have been filed in Singapore is based
merely on technicality. They did not even claim, much less prove, that the filing of the action here will
cause them any unnecessary trouble, damage, or expense. On the other hand, there is no showing
.that petitioner BANK filed the action here just to harass private respondents
**
In the case of Neville Y. Lamis Ents., et al. v. Lagamon, etc., where the stipulation was [i]n case of
:litigation, jurisdiction shall be vested in the Court of Davao City. We held
Anent the claim that Davao City had been stipulated as the venue, suffice it to say that a stipulation
as to venue does not preclude the filing of suits in the residence of plaintiff or defendant under
Section 2 (b), Rule 4, ROC, in the absence of qualifying or restrictive words in the agreement which
.would indicate that the place named is the only venue agreed upon by the parties
Applying the foregoing to the case at bar, the parties did not thereby stipulate that only the courts of
Singapore, to the exclusion of all the rest, has jurisdiction. Neither did the clause in question operate
to divest Philippine courts of jurisdiction. In International Law, jurisdiction is often defined as the light
of a State to exercise authority over persons and things within its boundaries subject to certain
exceptions. Thus, a State does not assume jurisdiction over travelling sovereigns, ambassadors and
diplomatic representatives of other States, and foreign military units stationed in or marching through
State territory with the permission of the latters authorities. This authority, which finds its source in the
concept of sovereignty, is exclusive within and throughout the domain of the State. A State is
competent to take hold of any judicial matter it sees fit by making its courts and agencies assume
jurisdiction over all kinds of cases brought before them
: NOTES
:The respondent IAC likewise ruled that
In a conflict problem, a court will simply refuse to entertain the case if it is not authorized by law to
exercise jurisdiction. And even if it is so authorized, it may still refuse to entertain the case by applying
.the principle of forum non conveniens
However, whether a suit should be entertained or dismissed on the basis of the principle of forum non
conveniens depends largely upon the facts of the particular case and is addressed to the sound
.discretion of the trial court. Thus, the IAC should not have relied on such principle

INGENOHL vs. OLSEN AND COMPANY, INC

G.R. No. L-22288
January 12, 1925

FACTS: In 1919, the acting Alien Property Custodian of the United States, by virtue of the Trading
with the Enemy Act as amended, required and caused to be conveyed to him the property and
business then belonging to the company known as Syndicat Oriente, formed under the laws of
Belgium, of which the plaintiff was the gestor, and an enemy as defined in said Act. The primary
purpose of the proceeding was to seize, sell and convey any and all of the property owned and held
by the company within the jurisdiction of the United States, as a war measure, upon the ground that
.they were alien enemies of the United States
During the public sale, defendant corporation was the highest bidder. The said Alien Property
Custodian of the United States having thereafter accepted said bid and received from the defendant
corporation in cash the amount of said bid, did execute in favor of the defendant corporation a deed
of conveyance. The defendant paid in good faith, and took over the property and assets of the
company, including its trade-marks and trade names and its business as a going concern
After obtaining the proceeds from the sale, the plaintiff in violation of the conveyance, wrongfully
instituted an action in the Supreme Court of Hongkong against the defendant in which the plaintiff
claimed to be the sole owner of the trade-marks for the exports of the business. The Supreme Court
of Hongkong ruled in favor of the plaintiff, allegedly through misrepresentation, ordering defendant to
pay the former for costs and AF. The Court ruled that the deed of conveyance limited the sale of the
business to the trademarks within the Philippines, implying that the plaintiff is still entitled to the sell
the cigars under the same trademarks through exporting, which accounts to 95% of the total sales of
the company. (This means that the plaintiff paid the cash equivalent of the whole of the business but
!only entitled to 5% of the such, the sales within the Philippines)- UNFAIR TALAGA
The CFI rendered judgment for the plaintiff for the full amount of his claim, with interest, from which
the defendant appeals. Defendant company alleges that when he purchased the property and
business, all trademarks are included; that the subject of the sale is not only those trademarks for
.sales within the Philippines

?ISSUE: Should the judgment rendered by the Hongkong court be enforced by Philippine courts

HELD: NO; we do not hesitate to say that the judgment rendered in the Hongkong court was a clear
.mistake of both law and fact, and that it ought not to be enforced in the Philippine Islands
The business of the plaintiff is almost exclusively an export business, and that the transfer of the
goodwill thereof necessarily carried with it the transfer of said export business and of the trade-marks
and trade names which could not be disconnected therefrom
It is conceded that the Hongkong court had jurisdiction and that the defendant appeared in the -
action and contested the case on its merits. Hence, there was no collusion. Neither is it claimed that
there was any fraud, but it is vigorously contended that the Hongkong judgment was a clear mistake
of both law and fact. Exclusive of the provisions of section 311 of the Code of Civil Procedure, it is
very doubtful whether it could be sustained upon the ground of comity or the Law of Nations. As
between allied nations and under the law of comity, their mutual policy should be to sustain and
enforce the spirit and intention with which the seizure and sale of any property of an alien enemy was
.made rather than to minimize, destroy or defeat them
We are construing a deed of conveyance from the United States to the defendant. The primary
purpose of the whole proceeding was to seize and convey all of the property of the plaintiff or his
company within the jurisdiction of the United States, including trade names and trade-marks as those
of an alien enemy. To now give the defendant the use and benefit of only 5 per cent of such trade
names and trade-marks, and to permit the plaintiff to have and retain the other 95 per cent to his own
use and benefit after he has ratified and confirmed the sale, would impugn the honor and good name
of the United States in the whole proceeding and defeat the very purpose for which it seized and sold
the property of an alien enemy, to wipe Ingenohl and his company out of existence and put them out
of business in so far as the United States had the power to do so
Be that as it may, this court is bound be section 311 of the Code of Civil Procedure. That law was
enacted by the Legislature of the Philippine Islands, and as to the Philippine Islands, it is the law of
the land. In the absence of that statute, no matter how wrongful the judgment of the Hongkong court
.may be, there would be strong reasons for holding that it should be enforced by this court

SAUDI ARABIAN AIRLINES (SAUDIA) vs. COURT OF APPEALS, MILAGROS P. MORADA and
HON. RODOLFO A. ORTIZ, in his capacity as Presiding Judge of Branch 89, RTC of Quezon
City
G.R. No. 122191 October 8, 1998

Facts: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. Saudia Airlines 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 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 Airlines officer. 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)