Batch Two Case Digests (case 1-14) participation of witnesses and of the Solicitor General.
ion of witnesses and of the Solicitor General. While the rule of lex loci celebrationis generally governs
EH 502
1. Republic of the Philippines vs. Sandiganbayan
From: AA
Facts: The point of contention of these four consolidated cases is the compromise agreement dated November
3, 1990 executed between Roberto S. Benedicto and the Presidential Commission on Good Government (PCGG)
represented by its then Chairman, David M. Castro, and the setting aside of the Sandiganbayan decision dated
October 2,1992 approving the compromise agreement and rendering judgment in accordance with its terms.
Under the compromise agreement, Benedicto and his group-controlled corporations ceded to the government
certain pieces of property listed in Annex A of the agreement and assigned or transferred whatever rights he may
have, if any, to the government over all corporate assets listed in Annex B of the agreement (pp. 115-125, Rollo
in G.R. No. 108292).The PCGG in turn, lifted the sequestrations over the property listed in Annex C (p. 125,
Rollo) as well as other assets mentioned in the agreement. The Government also extended absolute immunity to
Benedicto,members of his family, and officers and employees of the listed corporations such that there would be
no criminal investigation or prosecution for acts or omissions prior to February 25, 1986 that may be alleged to
have violated penal laws, including Act No. 3019, in relation to the acquisition of the assets under the agreement.
However, later on, the PCGG opined that the court was wrong in granting the agreement containing provisions
contrary to law, morals, good customs, public policy, and public order. The PCGG contends that its consent was
obtained through fraud and misrepresentation; that it is not in estoppel to question the validity of the agreement;
and that the respondent court was wrong in passing upon the PCGG's inability to return what was ceded to it
should the agreement be disapproved.
Note: third case in a series of global settlement:
1. the cases brought by the republic against Benedicto in the US. and was approved by the New York court
(settled through a plea bargaining agreement)
2. cases involving Benedicto's bank deposits were settled in Switzerland
Issues: W/N the compromise agreement was validly entered into because it was not authenticated before the
consular officials abroad and without the participation of the witnesses and of the SG?
Held: It is equally puerile for the PCGG to contend that the agreement is congenitally defective from the mere
happenstance that the agreement was not authenticated before the consular officials abroad and without the
forms and solemnities of contracts under Article 17 of the Civil Code (Vitug, Compendium of Civil Law and
Jurisprudence, 1986 First ed., p. 11), the principle of lex rei sitae generally applies with respect to formalities for
the acquisition, encumbrance, and alienation of real and personal property.
And relative to this precept on lex situs Philippine substantive law is certainly clear on the matter that contracts
are obligatory, in whatever form they may have been entered into, subject to the existence of all the essential
requisites for their validity (Article 1356, New Civil Code). The fact that the compromise agreement was not
authenticated before the consular officers abroad, as well as the absence of witnesses, cannot be of much legal
significance under Philippine law inasmuch as the requirement under Article1358(a) of the Civil Code, that a
contract intended to extinguish or transmit real rights over the immovables must be in a public document is
merely designed for greater efficacy or convenience (4 Tolentino, Commentaries and Jurisprudence on the Civil
Code of the Philippines, 1991 ed., p. 546).
Neither does the absence of the Solicitor General's participation render the agreement invalid since under both
Executive Order No. 2 and Executive Order No. 14-A, it is the PCGG which has been "primarily charged" with the
responsibility of recovering illegally acquired or misappropriated assets. It should perhaps be recalled at this
juncture that it was during this period that the OSG withdrew as counsel in PCGG cases, compelling the latter to
hire high-priced and supposedly competent lawyers of its own. Indeed, these events were the backdrop of the
widely acclaimed and erudite decision penned byJustice Flerida Ruth P. Romero wherein the OSG was advised of
its duties, the scope of its authority, the mandate of its office, and thence ordered to re-enter its appearance in
PCGG cases. In fine, the OSG is the least qualified agency to raise the argument that it had no participation in the
agreement.
2. Laurel vs. Garcial
From: PB
Facts: The subject property in this case is one of the four (4) properties in Japan acquired by the Philippine
government under the Reparations Agreement entered into with Japan on May 9, 1956, the other lots being:
(1) The Nampeidai Property at 11-24 Nampeidai-machi, Shibuya-ku,
(2) The Kobe Commercial Property at 63 Naniwa-cho, Kobe
(3) The Kobe Residential Property at 1-980-2 Obanoyama-cho, Shinohara, Nada-ku, Kobe, a residential lot which
is now vacant.
The Reparations Agreement provides that reparations valued at $550 million would be payable in twenty (20)
years in accordance with annual schedules of procurements to be fixed by the Philippine and Japanese
governments
(4) The Roppongi property was acquired from the Japanese government. The Roppongi property consists of the
land and building "for the Chancery of the Philippine Embassy". As intended, it became the site of the Philippine
Embassy until the latter was transferred to Nampeidai ,when the Roppongi building needed major repairs. Due to
the failure of our government to provide necessary funds, the Roppongi property has remained undeveloped
since that time.
Then President Corazon Aquino created a committee to study the disposition/utilization of Philippine government
properties in Tokyo and Kobe, Japan through Administrative Order No. 3, followed by Administrative Orders
Numbered 3-A, B, C and D.
CONFLICT OF LAWS CASE DIGEST (2016-2017) 1
Amidst opposition by various sectors, the Executive branch of the government has been pushing, with great
vigor, its decision to sell the reparations properties starting with the Roppongi lot. The property has twice been
set for bidding at a minimum floor price of $225 million.
Petitioner Contentions: Doy Laurel asserts that the Roppongi property and the related lots were acquired as
part of the reparations from the Japanese government for diplomatic and consular use by the Philippine
government. Vice-President Laurel states that the Roppongi property is classified as one of public dominion, and
not of private ownership under Article 420 of the Civil Code .
The petitioner submits that the Roppongi property comes under "property intended for public service" in
paragraph 2 of the above provision. He states that being one of public dominion, no ownership by anyone can
attach to it, not even by the State. The petitioner states that they continue to be intended for a necessary
service. They are held by the State in anticipation of an opportune use. Hence, it cannot be appropriated, is
outside the commerce of man, or to put it in more simple terms, it cannot be alienated nor be the subject matter
of contracts (Citing Municipality of Cavite v. Rojas, 30 Phil. 20 [1915]). Noting the non-use of the Roppongi
property at the moment, the petitioner avers that the same remains property of public dominion so long as the
government has not used it for other purposes nor adopted any measure constituting a removal of its original
purpose or use.
The respondents Contentions: For their part, refute the petitioner's contention by saying that the subject
property is not governed by our Civil Code but by the laws of Japan where the property is located. They rely
upon the rule of lex situs which is used in determining the applicable law regarding the acquisition, transfer and
devolution of the title to a property. They also invoke Opinion No. 21, Series of 1988, dated January 27, 1988 of
the Secretary of Justice which used the lex situs in explaining the inapplicability of Philippine law regarding a
property situated in Japan.
The respondents try to get around the public dominion character of the Roppongi property by insisting that
Japanese law and not our Civil Code should apply.
Issue: Whether or not the Roppongi property can be sold
Ruling: The Spume court ruled that, it is exceedingly strange why our top government officials, of all people,
should be the ones to insist that in the sale of extremely valuable government property, Japanese law and not
Philippine law should prevail. The Japanese law - its coverage and effects, when enacted, and exceptions to its
provision is not presented to the Court It is simply asserted that the lex loci rei sitae or Japanese law should
apply without stating what that law provides. It is a ed on faith that Japanese law would allow the sale.
We see no reason why a conflict of law rule should apply when no conflict of law situation exists. A conflict of law
situation arises only when: (1) There is a dispute over the title or ownership of an immovable, such that the
capacity to take and transfer immovables, the formalities of conveyance, the essential validity and effect of the
transfer, or the interpretation and effect of a conveyance, are to be determined; and (2) A foreign law on land
ownership and its conveyance is asserted to conflict with a domestic law on the same matters. Hence, the need
to determine which law should apply.
In the instant case, none of the above elements exists.
The issues are not concerned with validity of ownership or title. There is no question that the
property belongs to the Philippines. The issue is the authority of the respondent officials to validly dispose of
property belonging to the State. And the validity of the procedures adopted to effect its sale. This is governed by
Philippine Law. The rule of lex situs does not apply.
The assertion that the opinion of the Secretary of Justice sheds light on the relevance of the lex situs rule is
misplaced. The opinion does not tackle the alienability of the real properties procured through reparations nor the
existence in what body of the authority to sell them. In discussing who are capable of acquiring the lots, the
Secretary merely explains that it is the foreign law which should determine who can acquire the properties so
that the constitutional limitation on acquisition of lands of the public domain to Filipino citizens and entities wholly
owned by Filipinos is inapplicable.
Nota Bene: According to sir in the other transcript, what the Supreme Court seems to suggest that the principle
of Lex Rae Sitae applies only in cases where the issue involves ownership or title to the property.
Caveat: Sir: But to me, this ruling should be subscribed to the peculiar circumstances of this case and should not
be interpreted to mean that Lex rei sitae principle applies only to disputes involving ownership or title over
property. Because as emphasized earlier, lex rei sitae applies to any issues that pertain to property
(ex. Extrinsic validity, capacity of the contracting parties).
3. Sps. Zalamea vs. Court of Appeals
From: KB
FACTS: Petitioners (family of 3) purchased 3 airline tickets from Manila agent of Transworld Airlines for a flight
from New York to LA. They received reconfirmation of their flight 2 days prior to flight. On the date of the flight,
when they checked-in they were on waiting list because all the seats had already been taken. When spouses
bought tickets at 75% discount while the daughters ticket was full fare ticket. On the wait list, the daughters
name was placed on the 13th while the spouses are on the 34th. Only 22 were allowed to board the flight out of
42. The husband was allowed to fly only to discover that he was holding the ticket of his daughter. Whilst the
mother and daughter were denied boarding who were holding discounted tickets. Even on the next flight, they
were not accommodated because it was fully-booked. They were constrained to buy another ticket that cost
$918.00. When they came back to the Philippines, they filed an action for damages on breach of contract of air
carriage before RTC Makati. RTC in favor of petitioners. CA changed the award of damages removing moral and
exemplary damages and reimbursement of the fare of the ticket due to absence of bad faith. Since it is a matter
of record that overbooking of flights is a common and accepted practice of airlines in the US and allowed under
the Code of Federal Regulations by the Civil Aeronautics Board, no fraud nor bad faith could be imputed on TWA.
ISSUE: WON there was fraud or bad faith of TWA.
WON petitioners are entitled to moral, exemplary damages and the ticket cost of the new ticket.
RULING: Yes there was fraud or bad faith on the part of TWA. The US law or regulation allegedly authorizing
overbooking has never been proved. Foreign laws do not prove themselves nor can the courts take judicial notice
of them. They must be alleged and proved. Written law may be evidenced by an official publication or a copy
attested by the officer having the legal custody of the record, or by his deputy and accompanied with a certificate
that such officer has custody. The certificate may be made by a secretary of an embassy or legation, consul
general, consul, vice-consul, or consular agent by any officer in the foreign service of the Philippines stationed in
the foreign country in which the record is kept, and authenticated by the seal of the office. TWA relied solely on
the statement of the customer service agent, in her deposition, thus the CA finding that overbooking is
specifically allowed by the US Code has no basis.
Even assuming that US Code does exist, it will not be applicable to the case at bar in accordance with the
principle of lex loci contractus which requires that the law of the place where the airline ticket was issued should
be applied by the court where the passengers are residents and nationals of the forum and the ticket is issued in
such State by the defendant airline. Since the tickets were sold and issued in the Philippines, the applicable law is
Philippine law.
Existing jurisprudence explicitly states that overbooking amounts to bad faith entitling passengers to moral
damages. There was a breach of contract of carriage. Contract of carriage generates a relation attended with
public duty- a duty to provide public service and convenience to its passengers which must be paramount self-
interest or enrichment. Granting that the overbooking is allowed, TWA is still guilty of bad faith as it did not
inform it could breach the contract notwithstanding confirmed tickets. They fail to inform the passengers of its
alleged policy of giving less priority to discounted tickets.
CONFLICT OF LAWS CASE DIGEST (2016-2017) 2

4. United Airlines Inc. vs. Court of Appeals
From: BB
Facts: This involves a contract of carriage between an airline and airline passengers. The passengers there,
Anecito Fontanilla and his family bought plane tickets for United Airlines from the airline ticketing agency in the
Philippines for their trip from the Philippines to the US to visit the cities of DC, Chicago, and Los Angeles.
All flights had been confirmed previously by United Airlines. Having used the first coupon to DC and while at the
Washington Dulles Airport, Aniceto changed their itinerary, paid the penalty for rewriting their tickets and was
issued tickets with corresponding boarding passes with the words: Check-in-required. They were then set to
leave but were denied boarding because the flight was overbooked.
United Airlines alleged that the Fontanillas did not initially go to the check-in counter to get their seat
assignments for UA Flight 1108. They instead proceeded to join the queue boarding the aircraft without first
securing their seat assignments as required in their ticket and boarding passes. Having no seat assignments, the
stewardess at the door of the plane instructed them to go to the check-in counter. When the Fontanillas
proceeded to the check-in counter, Linda Allen, the United Airlines Customer Representative at the counter
informed them that the flight was overbooked. She booked them on the next available flight and offered them
denied boarding compensation.
And so the Fontanillas filed an action for breach of contract in the Philippines alleging that there was bad faith on
the part of the airline to deny them boarding even if they already checked in and they have confirmed tickets.
The airline interposed the defense that while the tickets were confirmed, the tickets were still subject to further
reconfirmation and check in. RTC dismissed the case for there was no legal malice. CA ruled in favor of the
Fontanelles stating therein that the private respondents' failure to comply with the check-in requirement will not
defeat his claim as the denied boarding rules were not complied with. Notably, the appellate court relied on the
Code of Federal Regulation Part on Oversales.
Issue: Whether or not the CA is correct in applying the laws of the USA.
Ruling: In US law, Code of Federal Regulation Part on Oversales, which states: 250.6 A passenger denied board
involuntarily from an oversold flight shall not be eligible for denied board compensation if: (a) The passenger
does not comply with the carrier's contract of carriage or tariff provisions regarding ticketing, reconfirmation,
check-in, and acceptability for transformation.
SC on the other hand, said it was error on the part of the CA to invoke a US law.
Ph's Economic Regulation #7 as amended: Subject to the exceptions provided hereinafter under Section 6,
carriers shall pay to passengers holding confirmed reserved space and who have presented themselves at the
proper place and time and fully complied with the carrier's check-in and reconfirmation procedures and who are
acceptable for carriage under the Carrier's tariffs but who have been denied boarding for lack of space, a
compensation at the rate of xxx.
In short, a passenger denied boarding by an airline because of overbooking is only entitled to compensation if
the passenger has complied with the checking and reconfirmation requirements. It is equally important to prove
that the passenger has complied with the requirements before boarding.
According to the doctrine of lex loci contractus, the law of the place where a contract is made or entered into
governs with respect to its nature and validity, obligation and interpretation shall govern. This has been said to
be the rule even though the place where the contract was made is different from the place where it is to be
performed. Hence, the court should apply the law of the place where the airline ticket was issued, where the
passengers are residents and nationals of the forum and the ticket is issued in such State by the defendant
airline. Therefore, although, the contract of carriage was to be performed in the United States, the tickets were
purchased
through petitioners agent in Manila. It is true that the tickets were "rewritten" in D.C., however, such fact did not
change the nature of the original contract of carriage entered into by the parties in Manila.
Also, there was no bad faith in the overbooking on the part of the airline carrier. The law clearly states that
when the overbooking does not exceed ten percent (10%), it is not considered as deliberate and therefore does
not amount to bad faith. While there may have been overbooking in this case, private respondents were not able
to prove that the overbooking on United Airlines Flight 1108 exceeded ten percent.
5. Korea Technologies Co. vs. Hon. Alberto Lerma
From: AC
Facts: Petitioner Korea Technologies Co., Ltd. (KOGIES) is a Korean corporation which is engaged in the supply
and installation of Liquefied Petroleum Gas (LPG) Cylinder manufacturing plants, while private respondent Pacific
General Steel Manufacturing Corp. (PGSMC) is a domestic corporation. On March 5, 1997, PGSMC and KOGIES
executed a Contract whereby KOGIES would set up an LPG Cylinder Manufacturing Plant in Carmona, Cavite. The
contract was executed in the Philippines. On April 7, 1997, the parties executed, in Korea, an Amendment for
Contract No. KLP-970301 dated March 5, 1997 amending the terms of payment. The contract and its amendment
stipulated that KOGIES will ship the machinery and facilities necessary for manufacturing LPG cylinders for which
PGSMC would pay USD 1,224,000. KOGIES would install and initiate the operation of the plant for which PGSMC
bound itself to pay USD 306,000 upon the plants production of the 11-kg. LPG cylinder samples. Thus, the total
contract price amounted to USD 1,530,000.
On October 14, 1997, PGSMC entered into a Contract of Lease with Worth Properties, Inc. (Worth) for use of
Worths 5,079-square meter property with a 4,032-square meter warehouse building to house the LPG
manufacturing plant. The monthly rental was PhP 322,560 commencing on January 1, 1998 with a 10% annual
increment clause. Subsequently, the machineries, equipment, and facilities for the manufacture of LPG cylinders
were shipped, delivered, and installed in the Carmona plant. PGSMC paid KOGIES USD 1,224,000. However,
gleaned from the Certificate executed by the parties on January 22, 1998, after the installation of the plant, the
initial operation could not be conducted as PGSMC encountered financial difficulties affecting the supply of
materials, thus forcing the parties to agree that KOGIES would be deemed to have completely complied with the
CONFLICT OF LAWS CASE DIGEST (2016-2017) 3
terms and conditions of the March 5, 1997 contract. For the remaining balance of USD306,000 for the installation
and initial operation of the plant, PGSMC issued two postdated checks: (1) BPI Check No. 0316412 dated January
30, 1998 for PhP 4,500,000; and (2) BPI Check No. 0316413 dated March 30, 1998 for PhP 4,500,000. When
KOGIES deposited the checks, these were dishonored for the reason PAYMENT STOPPED.
Thus, on May 8, 1998, KOGIES sent a demand letter to PGSMC threatening criminal action for violation of Batas
Pambansa Blg. 22 in case of nonpayment. On the same date, the wife of PGSMCs President faxed a letter dated
May 7, 1998 to KOGIES President who was then staying at a Makati City hotel. She complained that not only did
KOGIES deliver a different brand of hydraulic press from that agreed upon but it had not delivered several
equipment parts already paid for.
Issue: Whether or not the arbitration clause in the contract of the parties should govern.
Held: Yes. Established in this jurisdiction is the rule that the law of the place where the contract is made
governs. Lex loci contractus. The contract in this case was perfected here in the Philippines. Therefore, our laws
ought to govern. Nonetheless, Art. 2044 of the Civil Code sanctions the validity of mutually agreed arbitral clause
or the finality and binding effect of an arbitral award. Art. 2044 provides, Any stipulation that the arbitrators
award or decision shall be final, is valid, without prejudice to Articles 2038, 2039 and 2040.
The arbitration clause was mutually and voluntarily agreed upon by the parties. It has not been shown to be
contrary to any law, or against morals, good customs, public order, or public policy. There has been no showing
that the parties have not dealt with each other on equal footing. We find no reason why the arbitration clause
should not be respected and complied with by both parties. In Gonzales v. Climax Mining Ltd., we held that
submission to arbitration is a contract and that a clause in a contract providing that all matters in dispute
between the parties shall be referred to arbitration is a contract. Again in Del Monte Corporation-USA v. Court of
Appeals, we likewise ruled that [t]he provision to submit to arbitration any dispute arising therefrom and the
relationship of the parties is part of that contract and is itself a contract.
Having said that the instant arbitration clause is not against public policy, we come to the question on what
governs an arbitration clause specifying that in case of any dispute arising from the contract, an arbitral panel will
be constituted in a foreign country and the arbitration rules of the foreign country would govern and its award
shall be final and binding.
Thus, it can be gleaned that the concept of a final and binding arbitral award is similar to judgments or awards
given by some of our quasi-judicial bodies, like the National Labor Relations Commission and Mines Adjudication
Board, whose final judgments are stipulated to be final and binding, but not immediately executory in the sense
that they may still be judicially reviewed, upon the instance of any party. Therefore, the final foreign arbitral
awards are similarly situated in that they need first to be confirmed by the RTC.
6. Herald Black Dacasin vs. Sharon del Mundo Dacasin
From: DC
FACTS: Petitioner Herald Dacasin, American, and respondent Sharon Del Mundo Dacasin, Filipino, were married
in Manila. They have one daughter, Stephanie, born on 21 September 1995. In June 1999, respondent sought
and obtained from the Circuit Court, 19th Judicial Circuit, Lake County, Illinois (Illinois court) a divorce decree
against petitioner. In its ruling, the Illinois court dissolved the marriage of petitioner and respondent, awarded to
respondent sole custody of Stephanie and retained jurisdiction over the case for enforcement purposes.
On 28 January 2002, petitioner and respondent executed in Manila a contract Agreement for the joint custody of
Stephanie. The parties chose Philippine courts as exclusive forum to adjudicate disputes arising from the
Agreement. Respondent undertook to obtain from the Illinois court an order relinquishing jurisdiction to Philippine
courts.
In 2004, petitioner sued respondent in the RTC of Makati City, to enforce the Agreement. Petitioner alleged that
in violation of the Agreement, respondent exercised sole custody over Stephanie.
Respondent sought the dismissal of the complaint for, among others, lack of jurisdiction because of the Illinois
courts retention of jurisdiction to enforce the divorce decree. The RTC sustained respondents motion and
dismissed the case for lack of jurisdiction.
Petitioner sought reconsideration, raising the new argument that the divorce decree obtained by respondent is
void. Thus, the divorce decree is no bar to the trial courts exercise of jurisdiction over the case.
ISSUE: Whether the trial court has jurisdiction to take cognizance of petitioners suit and enforce the Agreement
on the joint custody of the parties child.
RULING: The trial court has jurisdiction to entertain petitioners suit but not to enforce the Agreement which is
void. However, factual and equity considerations militate against the dismissal of petitioners suit and call for the
remand of the case to settle the question of Stephanies custody.
Subject matter jurisdiction is conferred by law. At the time petitioner filed his suit in the trial court, statutory law
vests on Regional Trial Courts exclusive original jurisdiction over civil actions incapable of pecuniary estimation.
An action for specific performance, such as petitioners suit to enforce the Agreement on joint child custody,
belongs to this species of actions. Thus, jurisdiction-wise, petitioner went to the right court.
Petitioners Suit Lacks Cause of Action
CONFLICT OF LAWS CASE DIGEST (2016-2017) 4
The foregoing notwithstanding, the trial court cannot enforce the Agreement which is contrary to law. In this
jurisdiction, parties to a contract are free to stipulate the terms of agreement subject to the minimum ban on
stipulations contrary to law, morals, good customs, public order, or public policy.
At the time the parties executed the Agreement on 28 January 2002, two facts are undisputed: (1) Stephanie
was under seven years old (having been born on 21 September 1995); and (2) petitioner and respondent were
no longer married under the laws of the United States because of the divorce decree. The relevant Philippine law
on child custody for spouses separated in fact or in law (under the second paragraph of Article 213 of the Family
Code) is also undisputed: no child under seven years of age shall be separated from the mother. (This statutory
awarding of sole parental custody to the mother is mandatory, grounded on sound policy consideration, subject
only to a narrow exception not alleged to obtain here.)
The Agreement is not only void ab initio for being contrary to law; it has also been repudiated by the mother
when she refused to allow joint custody by the father. The Agreement would be valid if the spouses have not
divorced or separated because the law provides for joint parental authority when spouses live together.
Indeed, the separated parents cannot contract away the provision in the Family Code on the maternal custody of
children below seven years anymore than they can privately agree that a mother who is unemployed, immoral,
habitually drunk, drug addict, insane or afflicted with a communicable disease will have sole custody of a child
under seven as these are reasons deemed compelling to preclude the application of the exclusive maternal
custody regime under the second paragraph of Article 213.
It will not do to argue that the second paragraph of Article 213 of the Family Code applies only to judicial
custodial agreements based on its text that No child under seven years of age shall be separated from the
mother, unless the court finds compelling reasons to order otherwise. To limit this provisions enforceability to
court sanctioned agreements while placing private agreements beyond its reach is to sanction a double standard
in custody regulation of children under seven years old of separated parents.
Thus, it should be clear by now that a foreign divorce decree carries as much validity against the alien divorcee in
this jurisdiction as it does in the jurisdiction of the aliens nationality, irrespective of who obtained the divorce.
Instead of ordering the dismissal of petitioners suit, the logical end to its lack of cause of action, we remand the
case for the trial court to settle the question of Stephanie's custody. Stephanie is now nearly 15 years old, thus
removing the case outside of the ambit of the mandatory maternal custody regime under Article 213 and bringing
it within coverage of the default standard on child custody proceedings the best interest of the child.
7. Philippine Export and Foreign Loan Guarantee Corporation v V.P. Eusebio Construction Inc.
From: JJ
Facts: The State Organization of Buildings (SOB), Ministry of Housing and Construction, Baghdad, Iraq awarded
the construction of the Institute of Physical Therapy-Medical Rehabilitation Center in Iraq to Ayjal Trading and
Contracting Company for a total contract price of about $18M.
Spouses Santos, in behalf of 3-Plex International, Inc., a local contractor engaged in construction business,
entered into a joint venture agreement with Ayjal wherein the former undertook the execution of the entire a
project, while the latter would be entitled to a commission of 4%.
3-Plex not accredited by the Philippine Overseas Construction Board (POCB) assigned and transferred all its rights
and interests to VPECI.
The SOB required the contractors to submit a performance bond representing 5% of the total contract price, an
advance payment bond representing 10% of the advance payment to be released upon signing of the contract.
To comply with these requirements 3-Plex and VPECI applied for a guarantee with Philguarantee, a government
financial institution empowered to issue guarantees for qualified Filipino contractors.
But what SOB required was a guarantee from the Rafidain Bank of Baghdad so Rafidain Bank issued a
performance bond in favor of SOB on the condition that another foreign bank (not Phil Guarantee) would issue
the counter-guarantee. Hence, Al Ahli Bank of Kuwait was chosen to provide the counter guarantee.
Afterwards, SOB and the joint venture of VPECI and Ayjal executed the service contract. Under the contract, the
joint venture would supply manpower and materials, SOB would refund 25% of the project cost in Iraqi Dinar
and 75% in US dollars at an exchange rate of 1 Dinar to $3.37.
The project was not completed. Upon seeing the impossibility of meeting the deadline, the joint venture worked
for the renewal or extension (12x) of the performance bond up to December 1986.
In October 1986, Al Ahli Bank sent a telex call demanding full payment of its performance bond counter-
guarantee. Upon receipt, VPECI requested Iraq Trade and Economic Development Minister Fadhi Hussein to recall
the telex for being in contravention of its mutual agreement that the penalty will be held in abeyance until
completion of the project. It also wrote SOB protesting the telex since the Iraqi government lacks foreign
exchange to pay VPECI and the non-compliance with the 75% billings in US dollars.
Philguarantee received another telex from Al Ahli stating that it already paid to Rafidain Bank. The Central Bank
authorized the remittance to Al Ahli Bank representing the full payment of the performance counter-guarantee for
VPECI's project in Iraq.
Philguarantee sent letters to respondents demanding the full payment of the surety bond. Respondents failed to
pay so petitioner filed a civil case for collection of sum of money.
CONFLICT OF LAWS CASE DIGEST (2016-2017) 5
Trial Court ruling: Dismissed. Philguarantee had no valid cause of action against the respondents. The joint
venture incurred no delay in the execution of the project considering that SOB's violations of the contract
rendered impossible the performance of its undertaking.
Issue: What law should be applied in determining whether or not contractor (joint venture) has defaulted?
Held: The question of whether there is a breach of the agreement which includes default pertains to the
INTRINSIC validity of the contract.
No conflicts rule on essential validity of contracts is expressly provided for in our laws. The rule followed by most
legal systems is that the intrinsic validity of a contract must be governed by lex contractus (proper law of the
contract). This may be the law voluntarily agreed upon by the parties (lex loci voluntatis) or the law intended by
them either expressly or implicitly (lex loci intentionis). The law selected may be implied from factors such as
substantial connection with the transaction, or the nationality or domicile of the parties. Philippine courts adopt
this: to allow the parties to select the law applicable to their contract, SUBJECT to the limitation that it is not
against the law, morals, public policy of the forum and that the chosen law must bear a substantive relationship
to the transaction.
In the case, the service contract between SOB and VPECI contains no express choice of law. The laws of Iraq
bear substantial connection to the transaction and one of the parties is the Iraqi government. The place of
performance is also in Iraq. Hence, the issue of whether VPECI defaulted may be determined by the laws of Iraq.
BUT! Since foreign law was not properly pleaded or proved, processual presumption will apply.
According to Art 1169 of the Civil Code: In reciprocal obligations, neither party incurs in delay if the other party
does not comply or is not ready to comply in a proper manner what is incumbent upon him.
As found by the lower courts: the delay or non-completion of the project was caused by factors not imputable to
the Joint Venture, it was rather due to the persistent violations of SOB, particularly its failure to pay 75% of the
accomplished work in US dollars. Hence, the joint venture does not incur in delay if the other party(SOB) fails to
perform the obligation incumbent upon him.
8. Alonzo Ancheta vs. Candelaria Guersay-Dalaygon
From: MM
FACTS: Spouses Audrey O'Neill (Audrey) and W. Richard Guersey (Richard) were American citizens who have
resided in the Philippines for 30 years. They have an adopted daughter, Kyle Guersey Hill (Kyle). Audrey died,
leaving a will where she bequeathed her entire estate to Richard, who was also designated as executor. The will
was admitted to probate before the Orphan's Court of Baltimore, Maryland, U.S.A, which named James N. Phillips
as executor due to Richard's renunciation of his appointment. The court also named Atty. Alonzo Q. Ancheta
(petitioner) of the Quasha Asperilla Ancheta Pena & Nolasco Law Offices as ancillary administrator.
In 1981, Richard married Candelaria Guersey-Dalaygon (respondent) with whom he has two children, namely,
Kimberly and Kevin.
On October 12, 1982, Audrey's will was also admitted to probate by the then Court of First Instance of Rizal. As
administrator of Audrey's estate in the Philippines, petitioner filed an inventory and appraisal of the following
properties: (1) Audrey's conjugal share in real estate with improvements located at 28 Pili Avenue, Forbes Park,
Makati, Metro Manila, valued at P764,865.00 (Makati property); (2) Audrey's current account of P12,417.97; and
(3) 64,444 shares of stock in A/G Interiors, Inc. worth P64,444.00.
Richard died, leaving a will, wherein he bequeathed his entire estate to respondent, save for his rights and
interests over the A/G Interiors, Inc. shares, which he left to Kyle. The will was also admitted to probate by the
Orphan's Court of Ann Arundel, Maryland, U.S.A, and James N. Phillips was likewise appointed as executor, who
in turn, designated Atty. William Quasha or any member of the Quasha Asperilla Ancheta Pena & Nolasco Law
Offices, as ancillary administrator.
Richard's will was then submitted for probate before the RTC of Makati. Atty. Quasha was appointed as ancillary
administrator.
As administrator, petitioner filed a motion to declare Richard and Kyle as heirs of Audrey and a project of
partition of Audrey's estate, with Richard being apportioned the 3/4 and Kyle, the 1/4. This was granted and
proper actions were done.
Subsequently, petitioner also filed a project of partition wherein 2/5 of Richard's 3/4 undivided interest in the
Makati property was allocated to respondent, while 3/5 thereof were allocated to Richard's three children. This
was opposed by respondent on the ground that under the law of the State of Maryland, "a legacy passes to the
legatee the entire interest of the testator in the property subject of the legacy." Since Richard left his entire
estate to respondent, except for his rights and interests over the A/G Interiors, Inc, shares, then his entire 3/4
undivided interest in the Makati property should be given to respondent. This was granted but she subsequently
filed an amended complaint where she argued that since Audrey devised her entire estate to Richard, then the
Makati property should be wholly adjudicated to him, and not merely 3/4 thereof, and since Richard left his entire
estate, except for his rights and interests over the A/G Interiors, Inc., to respondent, then the entire Makati
property should now pertain to respondent.
Petitioner alleged that he was not aware of the relevant laws of the State of Maryland and believed that it is to
the "best interests of the surviving children that Philippine law be applied as they would receive their just shares."
ISSUE: WON the entire estate of Audrey should go to Richard then respondent except for the A/G shares
RULING: It is undisputed that Audrey Guersey was an American citizen domiciled in Maryland, U.S.A. During the
reprobate of her will, it was shown, among others, that at the time of Audrey's death, she was residing in the
Philippines but is domiciled in Maryland, U.S.A.; her Last Will and Testament was executed and probated before
CONFLICT OF LAWS CASE DIGEST (2016-2017) 6
the Orphan's Court in Baltimore, Maryland, U.S.A., which was duly authenticated and certified by the Register of
Wills of Baltimore City and attested by the Chief Judge of said court; the will was admitted by the Orphan's Court
of Baltimore City on September 7, 1979; and the will was authenticated by the Secretary of State of Maryland
and the Vice Consul of the Philippine Embassy.
Being a foreign national, the intrinsic validity of Audrey's will, especially with regard as to who are her heirs, is
governed by her national law, i.e., the law of the State of Maryland, as provided in Article 16 of the Civil Code, to
wit:
Art. 16. Real property as well as personal property is subject to the law of the country where it is situated.
However, intestate and testamentary succession, both with respect to the order of succession and to the amount
of successional rights and to the intrinsic validity of testamentary provisions, shall be regulated by the national
law of the person whose succession is under consideration, whatever may be the nature of the property and
regardless of the country wherein said property may be found.
Article 1039 of the Civil Code further provides that "capacity to succeed is governed by the law of the nation of
the decedent." As a corollary rule, Section 4, Rule 77 of the Rules of Court on Allowance of Will Proved Outside
the Philippines and Administration of Estate Thereunder, states:
SEC. 4. Estate, how administered. When a will is thus allowed, the court shall grant letters testamentary, or
letters of administration with the will annexed, and such letters testamentary or of administration, shall extend to
all the estate of the testator in the Philippines. Such estate, after the payment of just debts and expenses of
administration, shall be disposed of according to such will, so far as such will may operate upon it; and the
residue, if any, shall be disposed of as is provided by law in cases of estates in the Philippines belonging to
persons who are inhabitants of another state or country.
Petitioner invokes the principle which presumes the law of the forum to be the same as the foreign law in the
absence of evidence adduced to prove the latter law. In defending his actions in the light of the foregoing
principle, however, it appears that the defendant lost sight of the fact that his primary responsibility as ancillary
administrator was to distribute the subject estate in accordance with the will of Audrey O'Neill Guersey.
Considering the principle established under Article 16 of the Civil Code of the Philippines, as well as the
citizenship and the avowed domicile of the decedent, it goes without saying that the defendant was also duty-
bound to prove the pertinent laws of Maryland on the matter.
While foreign laws do not prove themselves in our jurisdiction and our courts are not authorized to take judicial
notice of them; however, in this case, given that the pertinent law of the State of Maryland has been brought to
record before the CA, and the trial court in Special Proceeding No. M-888 appropriately took note of the same in
disapproving the proposed project of partition of Richard's estate, not to mention that petitioner or any other
interested person for that matter, does not dispute the existence or validity of said law, then Audrey's and
Richard's estate should be distributed according to their respective wills, and not according to the project of
partition submitted by petitioner. Consequently, the entire Makati property belongs to respondent.
Petitioner's failure to proficiently manage the distribution of Audrey's estate according to the terms of her will and
as dictated by the applicable law amounted to extrinsic fraud. Hence Petitioner is ADMONISHED to be more
circumspect in the performance of his duties as an official of the court.
9. Palaganas vs. Palaganas
From: JM
Facts: On November 8, 2001 Ruperta C. Palaganas (Ruperta), a Filipino who became a naturalized United States
(U.S.) citizen, died single and childless. In the last will and testament she executed in California, she designated
her brother, Sergio C. Palaganas (Sergio), as the executor of her will for she had left properties in the Philippines
and in the U.S.
Respondent Ernesto C. Palaganas (Ernesto), another brother of Ruperta, filed with the RTC of Malolos, Bulacan, a
petition for the probate of Rupertas will and for his appointment as special administrator of her estate. Petitioners
Manuel Miguel Palaganas (Manuel) and Benjamin Gregorio Palaganas (Benjamin), nephews of Ruperta, opposed
the petition on the ground that Rupertas will should not be probated in the Philippines but in the U.S. where she
executed it. Manuel and Benjamin added that, assuming Rupertas will could be probated in the Philippines, it is
invalid nonetheless for having been executed under duress and without the testators full understanding of the
consequences of such act. Ernesto, they claimed, is also not qualified to act as administrator of the estate. RTC
issued an order: (a) admitting to probate Rupertas last will; (b) appointing respondent Ernesto as special
administrator at the request of Sergio, the U.S.-based executor designated in the will; and (c) issuing the Letters
of Special Administration to Ernesto. CA affirmed RTCs decision.
Issue: Whether or not a will executed by a foreigner abroad may be probated in the Philippines although it has
not been previously probated and allowed in the country where it was executed.
Ruling: YES. CA decision affirmed.
Petitioners Manuel and Benjamin maintain that wills executed by foreigners abroad must first be probated and
allowed in the country of its execution before it can be probated here. But our laws do not prohibit the probate
of wills executed by foreigners abroad although the same have not as yet been probated and allowed in the
countries of their execution. A foreign will can be given legal effects in our jurisdiction. Article 816 of the Civil
Code states that the will of an alien who is abroad produces effect in the Philippines if made in accordance with
the formalities prescribed by the law of the place where he resides, or according to the formalities observed in his
country. In this connection, Section 1, Rule 73 of the 1997 Rules of Civil Procedure provides that if the decedent
is an inhabitant of a foreign country, the RTC of the province where he has an estate may take cognizance of the
settlement of such estate.
In insisting that Rupertas will should have been first probated and allowed by the court of California, petitioners
Manuel and Benjamin obviously have in mind the procedure for the reprobate of will before admitting it here.
CONFLICT OF LAWS CASE DIGEST (2016-2017) 7
But, reprobate or re-authentication of a will already probated and allowed in a foreign country is different from
that probate where the will is presented for the first time before a competent court. Reprobate is specifically
governed by Rule 77 of the Rules of Court. Contrary to petitioners stance, since this latter rule applies only to
reprobate of a will, it cannot be made to apply to the present case. In reprobate, the local court acknowledges as
binding the findings of the foreign probate court provided its jurisdiction over the matter can be established.
Notably, the assailed RTC order is nothing more than an initial ruling that the court can take cognizance of the
petition for probate of Rupertas will and that, in the meantime, it was designating Ernesto as special
administrator of the estate. The parties have yet to present evidence of the due execution of the will, i.e. the
testators state of mind at the time of the execution and compliance with the formalities required of wills by the
laws of California. This explains the trial courts directive for Ernesto to submit the duly authenticated copy of
Rupertas will and the certified copies of the Laws of Succession and Probate of Will of California.
10. Elmar Perez vs. Court of Appeals
From: SO
FACTS: Private respondent Tristan married Lily twice on May 16, 1968 in the Philippines. Several years later, the
couple encountered marital problems and decided to obtain a divorce from the Dominican Republic. Thus, on
April 27, 1984, Tristan and Lily executed a Special Power of Attorney addressed to the Judge of the First Civil
Court Dominican Republic, appointing an attorney-in-fact to institute a divorce action under its laws. Thereafter,
private respondents Tristan & Lily filed a joint petition for dissolution of conjugal partnership with the RTC Makati.
On June 12, 1984, the civil court in the Dominican Republic ratified the divorce by mutual consent of Tristan and
Lily. Subsequently, the RTC Makati ordered the complete separation of properties between Tristan and Lily.
On July 14, 1984, Tristan married petitioner Elmar in the United States and both lived as husband and wife until
October 2001. Petitioner learned that the divorce decree issued by the court in the Dominican Republic which
"dissolved" the marriage between Tristan and Lily was not recognized in the Philippines and that her marriage to
Tristan was deemed void under Philippine law. On August 13, 2001, Tristan filed a petition for the declaration of
nullity of his marriage to Lily with the RTC Quezon City. Here, petitioners complaint-in-intervention was admitted.
The CA declared as null and void the order of the RTC granting the motion for leave to file intervention and
admitting the complaint-in-intervention. Hence, this petition.
ISSUE: WON petitioner acquired the legal interest as a wife upon which her motion for intervention is based.
HELD: No.
Petitioner claims that her status as the wife and companion of Tristan for 17 years vests her with the requisite
legal interest required of a would-be intervenor under the Rules of Court. Petitioners claim lacks merit. Under the
law, petitioner was never the legal wife of Tristan, hence her claim of legal interest has no basis.
When petitioner and Tristan married on July 14, 1984, Tristan was still lawfully married to Lily. The divorce
decree that Tristan and Lily obtained from the Dominican Republic never dissolved the marriage bond between
them. Regardless of where a citizen of the Philippines might be, he or she will be governed by Philippine laws
with respect to his or her family rights and duties, or to his or her status, condition and legal capacity. Hence, if a
Filipino regardless of whether he or she was married here or abroad, initiates a petition abroad to obtain an
absolute divorce from spouse and eventually becomes successful in getting an absolute divorce decree, the
Philippines will not recognize such absolute divorce.
Tristan and Lilys marriage on May 16, 1968 was governed by the Civil Code which took effect on August 30,
1950. The SC held in Tenchavez v. Escano that a foreign divorce between Filipino citizens, sought and decreed
after the effectivity of the present Civil Code, is not entitled to recognition as valid in this jurisdiction; and neither
is the marriage contracted with another party by the divorced consort, subsequently to the foreign decree of
divorce, entitled to validity in the country. Thus, petitioners claim that she is the wife of Tristan even if their
marriage was celebrated abroad lacks merit. Thus, petitioner never acquired the legal interest as a wife upon
which her motion for intervention is based. WHEREFORE, the petition is DISMISSED.
11. PCL Shipping Philippines vs. NLRC and Steve Rusel
From: NT
Facts: In April 1996, Rusel was employed as seaman by PCL Shipping Philippines for and in behalf of its foreign
principal, U-Ming Marine. Rusel thereby joined the vessel MV Cemtex for 12 months with a basic monthly salary
of US$400.00, living allowance of US$140.00, fixed overtime rate of US$120.00 per month, vacation leave with
pay of US$40.00 per month and special allowance of US$175.00.
On July 16, 1996, while Rusel was cleaning the vessel's kitchen, he slipped, and as a consequence thereof, he
suffered a broken/sprained ankle on his left foot. A request for medical examination was flatly denied by the
captain of the vessel. On August 13, 1996, feeling an unbearable pain in his ankle, Rusel jumped off the vessel
using a life jacket and swam to shore.
He was brought to a hospital where he was confined for 8 days. On August 22, 1996, a vessel's agent fetched
Rusel from the hospital and was required to board a plane bound for the Philippines. On September 26, 1996,
Rusel filed a complaint for illegal dismissal, non-payment of wages, overtime pay, claim for medical benefits, sick
leave pay and damages against PCL Shipping and U-Ming Marine before the arbitration branch of the NLRC. In
their answer, the latter alleged that Rusel deserted his employment by jumping off the vessel.
Labor Arbiter held that respondent is liable for the unjust repatriation of the complainant. NLRC affirmed the
finding of the Labor Arbiter.
Issue: Whether or not respondent was guilty of desertion to justify his dismissal.
CONFLICT OF LAWS CASE DIGEST (2016-2017) 8
 HELD: The fact that the late Lorenzo N. Llorente became an American citizen long before and at the time of: (1)
his divorce from Paula; (2) marriage to Alicia; (3) execution of his will; and (4) death, is duly established,
Held: No. admitted and undisputed.

For a seaman to be considered as guilty of desertion, it is essential that there be evidence to prove that if he Thus, as a rule, issues arising from these incidents are necessarily governed by foreign law, including those on
leaves the ship or vessel in which he had engaged to perform a voyage, he has the clear intention of abandoning "family rights and duties, status, condition and legal capacity.
his duty and of not returning to the ship or vessel. In the present case, however, petitioners failed to present
clear and convincing proof to show that when private respondent jumped ship, he no longer had the intention of
returning. The fact alone that he jumped off the ship where he was stationed, swam to shore and sought medical
assistance for the injury he sustained is not a sufficient basis for petitioners to conclude that he had the intention However, foreign laws do not prove themselves in our jurisdiction and our courts are not authorized to take
of deserting his post. judicial notice of them. Like any other fact, they must be alleged and proved.

Applicable law

As for succession, the "national law" indicated in Article 16 of the Civil Code cannot possibly apply to the general
American law. Each State has its own law applicable to its citizens and in force only within the State. It therefore
12. Llorente vs. Llorente refers to the law of the State of which the decedent was a resident and there was also no showing that the
application of the renvoi doctrine was called for or required by New York State law.
From: MM

Validity of foreign divorce

Facts: The deceased Lorenzo N. Llorente was enlisted with the US Navy. Lorenzo married petitioner Paula
Llorente. Before the outbreak of the Pacific War, Lorenzo departed for the United States and Paula stayed in the The Supreme Court recognized as valid the decree of divorce granted in favor of the deceased Lorenzo N.
conjugal home in barrio Antipolo, Nabua, Camarines Sur. Lorenzo was subsequently naturalized as an American Llorente by the Superior Court of the State of California in and for the County of San Diego, made final on
citizen. On February 22, 1937, When Lorenzo returned to the Philippines to visit his wife, he discovered that she December 4, 1952. Our Civil Code provides that our law on status governs citizens of the Philippines. Llorente
was pregnant and was "living in" with his brother, Ceferino Llorente. Lorenzo returned to the United States and was already an American citizen when he obtained a divorce so he follows US law, and since divorce is valid
filed for divorce with the Superior Court of the State of California in and for the County of San Diego. Paula was under his national law, it must likewise be recognized insofar as Paula is concerned.
represented by counsel, John Riley, and actively participated in the proceedings. The Superior Court of the State
of California, for the County of San Diego found all factual allegations to be true and issued an interlocutory
judgment of divorce. subsequently the divorce decree became final. On January 16, 1958, Lorenzo married Alicia
F. Llorente in Manila with whom he had three children, Raul, Luz and Beverly, all surnamed Llorente. Lorenzo Validity of the Will
executed a Last Will and Testament where he bequeathed all his property to Alicia and their three children, then
filed with the Regional Trial Court, Iriga, Camarines Sur, a petition for the probate and allowance of his last will The Civil Code provides: "ARTICLE 17. The forms and solemnities of contracts, wills, and other public instruments
and testament moving that Alicia be appointed Special Administratrix of his estate. The trial court admitted the shall be governed by the laws of the country in which they are executed.
will to probate but before the proceedings could be terminated, Lorenzo died. Paula filed with the same court a
petition for letters of administration over Lorenzo's estate in her favor. Alicia also filed in the testate proceeding a
petition for the issuance of letters testamentary. The trial court denied Alicia's petition and ruled that the divorce
decree granted to the late Lorenzo Llorente was void and inapplicable in the Philippines, therefore, her marriage "When the acts referred to are executed before the diplomatic or consular officials of the Republic of the
to Lorenzo was likewise void. The trial court appointed Paula Llorente as legal administrator of the estate of the Philippines in a foreign country, the solemnities established by Philippine laws shall be observed in their
deceased. Respondent Alicia appealed to the Court of Appeals which affirmed with modification the decision of execution."
the trial court, declaring Alicia as co-owner of whatever properties she and the deceased Lorenzo may have
acquired during the twenty-five (25) years of cohabitation. Petitioner Paula moved for reconsideration, but was
denied for lack of merit. Hence, the present petition.
Whether the will is intrinsically valid and who shall inherit from Lorenzo are issues best proved by foreign law
which must be pleaded and proved. Whether the will was executed in accordance with the formalities required is
answered by referring to Philippine law. In fact, the will was duly probated.
ISSUE: Who are entitled to inherit from Lorenzo Llorente?

As a guide however, the trial court should note that whatever public policy or good customs may be involved in
our system of legitimes, Congress did not intend to extend the same to the succession of foreign nationals.
Congress specifically left the amount of successional rights to the decedent's national law.

CONFLICT OF LAWS CASE DIGEST (2016-2017) 9


13. Corpuz vs. Sto. Tomas
From: JJ
Art. 26. All marriages solemnized outside the Philippines, in accordance with the laws in force in the country
where they were solemnized, and valid there as such, shall also be valid in this country, except those prohibited
under Articles 35(1), (4), (5) and (6), 36, 37 and 38.
Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter
validly obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino spouse shall likewise
have capacity to remarry under Philippine law.
FACTS: Petitioner Gerbert R. Corpuz was a former Filipino citizen who acquired Canadian citizenship through
naturalization on November 29, 2000. On January 18, 2005, Gerbert married respondent Daisylyn T. Sto. Tomas,
a Filipina, in Pasig City. Due to work and other professional commitments, Gerbert left for Canada soon after the
wedding. He returned to the Philippines sometime in April 2005 to surprise Daisylyn, but was shocked to discover
that his wife was having an affair with another man. Hurt and disappointed, Gerbert returned to Canada and filed
a petition for divorce. The Superior Court of Justice, Windsor, Ontario, Canada granted Gerberts petition for
divorce on December 8, 2005. Gerbert filed a petition for judicial recognition of foreign divorce and/or declaration
of marriage as dissolved (petition) with the RTC.
DECISION OF LOWER COURTS:
(1) RTC: Gerbert was not the proper party to institute the action for judicial recognition of the foreign divorce
decree as he is a naturalized Canadian citizen. It ruled that only the Filipino spouse can avail of the remedy,
under the second paragraph of Article 26 of the Family Code
ISSUE: whether the second paragraph of Article 26 of the Family Code extends to aliens the right to petition a
court of this jurisdiction for the recognition of a foreign divorce decree.
RULING: Yes.
The General Rule is that the alien spouse can claim no right under the second paragraph of Article 26 of the
Family Code as the substantive right it establishes is in favor of the Filipino spouse. In other words, only the
Filipino spouse can invoke the second paragraph of Article 26 of the Family Code; the alien spouse can claim no
right under this provision.
The foreign divorce decree is presumptive evidence of a right that clothes the party with legal interest to petition
for its recognition in this jurisdiction. BUT - direct involvement or being the subject of the foreign judgment is
sufficient to clothe a party with the requisite interest to institute an action before our courts for the recognition of
the foreign judgment. In a divorce situation, we have declared, no less, that the divorce obtained by an alien
abroad may be recognized in the Philippines, provided the divorce is valid according to his or her national law.
The case is remanded to the RTC to determine whether the divorce decree is consistent with the Canadian
divorce law. Pasig City Civil Registry Office has already recorded the divorce decree on Gerbert and Daisylyns
marriage certificate based on the mere presentation of the decree. We consider the recording to be legally
improper; hence, the need to draw attention of the bench and the bar to what had been done.
But while the law requires the entry of the divorce decree in the civil registry, the law and the submission of the
decree by themselves do not ipso facto authorize the decrees registration. The law should be read in relation
with the requirement of a judicial recognition of the foreign judgment before it can be given res judicata effect.
In the context of the present case, no judicial order as yet exists recognizing the foreign divorce decree. Thus,
the Pasig City Civil Registry Office acted totally out of turn and without authority of law when it annotated the
Canadian divorce decree on Gerbert and Daisylyns marriage certificate, on the strength alone of the foreign
decree presented by Gerbert. For being contrary to law, the registration of the foreign divorce decree without the
requisite judicial recognition is patently void and cannot produce any legal effect.
Cancellation of the entry in the civil registry requirements:
(1) verified petition must be filed with the RTC of the province where the corresponding civil registry is located
(2) civil registrar and all persons who have or claim any interest must be made parties to the proceedings
(3) time and place for hearing must be published in a newspaper of general circulation
As these basic jurisdictional requirements have not been met in the present case, we cannot consider the petition
Gerbert filed with the RTC as one filed under Rule 108 of the Rules of Court.
14. Soledad Lavadia vs. Heirs of Juan Luces Luna
From: SO
Divorce between Filipinos is void and ineffectual under the nationality rule adopted by Philippine law.
Hence, any settlement of property between the parties of the first marriage involving Filipinos submitted as an
incident of a divorce obtained in a foreign country lacks competent judicial approval, and cannot be enforceable
against the assets of the husband who contracts a subsequent marriage.
FACTS: In 1947, Atty. Luna married his first wife Eugenia tin the Philippines. They begot 7 children. After almost
2 decades of marriage, they agreed to live apart from each other and entered into an Agreement for Separation
and Property Settlement whereby they agreed to live separately and to dissolve and liquidate their conjugal
partnership of property. On January 12, 1976, Atty. Luna obtained a divorce decree of his marriage with Eugenia
in Dominican Republic. On the same date, he contracted another marriage with petitioner Soledad Thereafter,
Atty. Luna and petitioner returned to the Philippines and lived together as husband and wife until 1987.
CONFLICT OF LAWS CASE DIGEST (2016-2017) 10
Sometime in 1977, Atty. Luna organized a new law firm named LUPSICON whereby through Atty. Luna
purchased a condominium unit which was to be used as law office. The parties stipulated that the interest of
Atty. Luna over the condominium unit would be 25/100 share. After LUPSICON was dissolved, Atty. Luna
established another law firm with Atty. Renato and used a portion of the office condominium unit as their office.
The said law firm lasted until the death of Atty. Luna on July 12, 1997. After the death of Atty. Luna, his share in
the condominium unit including the lawbooks, office furniture and equipment found therein were taken over by
Gregorio Luna, his son in the first marriage.
2.No. Atty. Lunas marriage with petitioner, being bigamous, was void; properties acquired during their marriage
were governed by the rules on co-ownership. In such a situation, whoever alleges co-ownership carried the
burden of proof to confirm such fact. Petitioner did not discharge her burden of proof. Her mere allegations on
her contributions, not being evidence did not serve the purpose.
WHEREFORE, the Court AFFIRMS the decision.

The 25/100 pro-indiviso share of Atty. Luna in the condominium unit as well as the law books, office furniture
and equipment became the subject of the complaint filed by petitioner alleging that the subject properties were
acquired during the existence of the marriage between her and Atty. Luna. The RTC ruled against her, and
awarded the properties to the heirs of Atty. Luna from the first marriage, except for the law books, which were
ordered turned over to her. Both parties appealed to the CA which modified the RTC judgment by awarding all
the properties, including the law books to the heirs of Atty. Luna from the first marriage.

ISSUES:

1. WON the divorce decree had validly dissolved the marriage between Atty. Luna and Eugenia.
2. WON the second marriage entered into by the late Atty. Luna and the petitioner entitled the latter to
any rights in property.

HELD:

1. No. The divorce decree, even if voluntarily obtained abroad, did not dissolve the marriage between Atty. Luna
and Eugenia, which subsisted up to the time of his death.

The first marriage between Atty. Luna and Eugenia, both Filipinos, was solemnized in the Philippines
on September 10, 1947. The law in force at the time of the solemnization was the Spanish Civil Code, which
adopted the nationality rule. The Civil Code continued to follow the nationality rule. Pursuant to the nationality
rule, Philippine laws governed this case by virtue of both Atty. Luna and Eugenia having remained Filipinos. From
the time of the celebration of the first marriage until the present, absolute divorce between Filipino spouses has
not been recognized in the Philippines. The non-recognition of absolute divorce between Filipinos has remained
even under the Family Code, even if either or both of the spouses are residing abroad. Indeed, the only two
types of defective marital unions under our laws have been the void and the voidable marriages. As such, the
remedies against such defective marriages have been limited to the declaration of nullity of the marriage and the
annulment of the marriage.

Here, the Agreement for Separation and Property Settlement was void for lack of court approval. The
mere execution of the said Agreement did not per se dissolve and liquidate their conjugal partnership of gains.
The approval of the Agreement by a competent court was still required under the Civil Code. But was not the
approval of the Agreement by the CFI of the Dominican Republic sufficient in dissolving and liquidating the
conjugal partnership of gains? The query is answered in the negative. There is no question that the approval took
place only as an incident of the action for divorce instituted by Atty. Luna and Eugenia, for, indeed, the
justifications for their execution of the Agreement were identical to the grounds raised in the action for divorce.
With the divorce not being itself valid and enforceable under Philippine law for being contrary to Philippine public
policy and public law, the approval of the Agreement was not also legally valid and enforceable under Philippine
law. Consequently, the conjugal partnership of gains of Atty. Luna and Eugenia subsisted in the lifetime of their
marriage.

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