Digests (Conflict of Laws)
1. Hilton vs Guyot
Hilton v. Guyot
Brief Fact Summary
Hilton (Plaintiff) and Libbey (Plaintiff) appealed from a federal district court
holding that a French court judgment against them for amounts allegedly
owed to a French firm was enforceable without retrial on the merits.
Synopsis of Rule of Law
No law has any effect, of its own force, beyond the limits of the sovereignty
from which its authority is derived.
Facts
Hilton (Plaintiff) and Libbey (Plaintiff), New York citizens trading in Paris,
were sued in France by Guyot (Defendant), the administrator of a French
firm, for sums allegedly owed to that firm. The Plaintiffs appeared and
litigated the merits in the French proceeding. The French court rendered a
judgment against them that was affirmed by a higher court and became
final. Defendant then sought to enforce that judgment in federal district
court in New York. That court held the judgment enforceable without retrial
on the merits. The Plaintiffs then appealed to the U.S. Supreme Court.
Issue
Do laws have any effect, of their own force, beyond the limits of the
sovereignty from which its authority is derived?
Held
(Gray, J.) No. No law has any effect, of its own force, beyond the limits of
the sovereignty from which its authority is derived. No sovereign is bound,
unless by special compact, to execute within his dominions a judgment
rendered by the tribunals of another state, and if execution be sought by suit
upon the judgment or otherwise, the tribunal in which the suit is brought, or
from which execution is sought, is, on principle, at liberty to examine into the
merits of such judgment, and to give effect to it or not, as may be found just
and equitable. However, the general comity, utility and convenience of
nations have established a usage among most civilized states, by which the
final judgments of foreign courts of competent jurisdiction are reciprocally
carried into execution, under certain regulations and restrictions, which differ
in different countries. Additionally, judgments rendered in France, or in any
foreign country, by the laws of which our own judgments are reviewable upon
the merits, are not entitled to full credit and conclusive effect when sued upon
in this country, but are prima facie evidence only of the justice of the
plaintiffs’ claim. Reversed.
Dissent
(Fuller, C.J.)Â The doctrine of res judicata should be applicable to domestic
judgments as well as to foreign judgments, and rests on the same general
ground of public policy that there should be an end of litigation.
Discussion
The Court’s decision in Hilton v. Guyot reflects the traditional rule of
reciprocity. According to this concept, foreign nation judgments were
granted the same or comparable treatment as American judgments were
given by the judgment nation. Since the Court in Hilton found that French
courts would not have enforced or executed a judgment rendered in this
country, it therefore held that the French judgment at issue should be
nonconclusive here.
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Hilton v. Guyot
Hilton v. Guyot, 159 U.S. 113 (1895), was a United States Supreme
Court case where the Court ruled that the recognition and enforceability of a
foreign judgment rested on the "comity of nations," namely whether there
would be any reciprocity and mutual recognition by the foreign jurisdiction
from which the judgment was issued.[1]
Hilton established the fundamental basis for the recognition and enforcement
of foreign judgments in the United States,[2] remaining "the most detailed
exposition of any American court" on this principle.[3] It is also viewed as the
quintessential statement of comity in international law,[4] and is one of the
earliest decisions of the U.S. Supreme Court to assert that international law
is part of U.S. law.[5]
Background
Hilton and Libbey, U.S. citizens conducting business in Paris, France, were
sued in French court by Guyot, the administrator of a French firm, for sums
allegedly owed to that firm. They appeared and litigated the merits before the
French court, which rendered a judgment against them that was affirmed by
a higher court and became final. Guyot sought to enforce that judgment in
federal district court in New York, which held that the French judgment was
enforceable without retrial on the merits. Hilton and Libbey subsequently
appealed to the U.S. Supreme Court.
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Opinion of the Court
The central question before the Court was whether a judgment had force
beyond the limits of the sovereign jurisdiction from which its authority
derived. In finding that there was no applicable treaty or domestic statute
from which an answer could be derived, the Court determined that it was
incumbent on the judiciary to ascertain the law, based on guidance from
"judicial decisions, from the works of jurists and commentators, and from the
acts and usages of civilized nations."
In an opinion authored by Justice Horace Gray, the Court, drawing upon both
domestic and international legal sources, concluded that whether any foreign
judgment was to be enforced in the U.S. rested on whether there was comity
between the U.S. and the foreign jurisdiction in question. In articulating this
position, the Court set forth the general standard for making this
determination and for what defined international comity.
No law has any effect, of its own force, beyond the limits of the sovereignty
from which its authority is derived. The extent to which the law of one nation,
as put in force within its territory, whether by executive order, by legislative
act, or by judicial decree, shall be allowed to operate within the dominion of
another nation, depends upon what our greatest jurists have been content to
call 'the comity of nations.' Although the phrase has been often criticised, no
satisfactory substitute has been suggested.
'Comity,' in the legal sense, is neither a matter of absolute obligation, on the
one hand, nor of mere courtesy and good will, upon the other. But it is the
recognition which one nation allows within its territory to the legislative,
executive or judicial acts of another nation, having due regard both to
international duty and convenience, and to the rights of its own citizens, or of
other persons who are under the protection of its laws. [6]
Applying this standard, the Court reasoned, after examining relevant French
laws and judicial decisions, that a French court would not have recognized a
foreign judgment without having first considered its merits. Therefore, based
on the notion of reciprocity derived from international comity, U.S. courts
should similarly examine the merits of any judgment prior to ruling on its
enforcement. The judgment of the U.S. circuit court was subsequently
reversed and the case remanded for retrial.
The Court's opinion is notable for drawing heavily from international legal
sources, specifically the laws and practices of over a dozen nations all over
the world regarding the recognition and enforcement of foreign judgments.
Thus, Hilton was one of the first Supreme Court cases to apply customary
international law—the prevailing practices of states—in making its
determination as to non-U.S. judgments:
It appears, therefore, that there is hardly a civilized nation on either continent,
which, by its general law, allows conclusive effect to an executory foreign
judgment for the recovery of money. In France, and in a few smaller States
— Norway, Portugal, Greece, Monaco, and Hayti — the merits of the
controversy are reviewed, as of course, allowing to the foreign judgment, at
the most, no more effect than of being prima facie evidence of the justice of
the claim. In the great majority of the countries on the continent of Europe —
in Belgium, Holland, Denmark, Sweden, Germany, in many cantons of
Switzerland, in Russia and Poland, in Roumania, in Austria and Hungary,
(perhaps in Italy,) and in Spain — as well as in Egypt, in Mexico, and in a
great part of South America, the judgment rendered in a foreign country is
allowed the same effect only as the courts of that country allow to the
judgments of the country in which the judgment in question is sought to be
executed.
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2. Saudi Arabian Airlines vs Court of Appeals
Conflicts Of Laws Case Digest: Saudi Arabian Airlines V. CA
G.R. No. 122191 October 8, 1998
Laws Applicable: Art 19 and 21 of Civil Code
Lessons Applicable: Conflict of Laws, factual situation, connecting factor,
characterization, choice of law, State of the most significant relationship
FACTS:
Saudi Arabian Airlines (SAUDIA), foreign airlines corporation doing business
in the Philippines and may be served summons in agent in Makati, hired
Milagros P. Morada as a flight attendant for its airlines based in Jeddah,
Saudi Arabia.
April 27, 1990: While on a lay-over in Jakarta, Indonesia, Morada went to a
disco dance with fellow crew members Thamer Al-Gazzawi and Allah Al-
Gazzawi, both Saudi nationals. It was almost morning when they returned to
their hotels so they agreed to have breakfast together at the room of
Thamer. Shortly after Allah left the room, Thamer attempted to rape Morada.
Fortunately, a roomboy and several security personnel heard her cries for
help and rescued her. Indonesian police arrested Thamer and Allah Al-
Gazzawi, the latter as an accomplice.
When Morada returned to Jeddah, SAUDIA officials interrogated her about
the Jakarta incident and requested her to go back to Jakarta to help arrange
the release of Thamer and Allah. In Jakarta, SAUDIA Legal Officers
negotiated with the police for the immediate release of the detained crew
members but did not succeed. Afraid that she might be tricked into
something she did not want because of her inability to understand the local
dialect, Morado refused to cooperate and declined to sign a blank paper and
a document written in the local dialect. Eventually, SAUDIA allowed Morada
to return to Jeddah but barred her from the Jakarta flights.
Indonesian authorities agreed to deport Thamer and Allah and they were
again put in service. While, Morada was transferred to Manila.
January 14, 1992: Morada was asked to see Mr. Ali Meniewy, Chief Legal
Officer of SAUDIA, in Jeddah, Saudi Arabia. He brought her to the police
station where the police took her passport and questioned her about the
Jakarta incident. The police pressured her to drop the case against Thamer
and Allah. Not until she agreed to do so did the police return her passport
and allowed her to catch the afternoon flight out of Jeddah.
June 16, 1993: Morada, while in Riyadh Saudi Arabia, was not allowed to
board the plane to Manila and instead ordered to take a later flight to Jeddah
to see Mr. Miniewy. Khalid of the SAUDIA office brought her to a Saudi court
where she was asked to sign a document written in Arabic. They told her that
this was necessary to close the case against Thamer and Allah but it was
actually a notice for her to appear before the court on June 27,
1993. Plaintiff then returned to Manila.
June 27, 1993: SAUDIA's Manila manager, Aslam Saleemi, assured Morada
that the investigation was routinary and that it posed no danger to her so she
reported to Miniewy in Jeddah for further investigation. She was brought to
the Saudi court.
June 28, 1993: Saudi judge interrogated Morada through an interpreter about
the Jakarta incident for an hour and let her go. SAUDIA officers forbidden
her to take flight. She was told to go the Inflight Service Office where her
passport was taken and they told her to remain in Jeddah, at the crew
quarters, until further orders.
July 3, 1993: She was brought to court again and to her astonishment and
shock, rendered a decision, translated to her in English, sentencing her to
five months imprisonment and to 286 lashes. The court tried her, together
with Thamer and Allah, and found her guilty of (1) adultery (2) going to a
disco, dancing and listening to the music in violation of Islamic laws and (3)
socializing with the male crew, in contravention of Islamic tradition.
Failing to seek the assistance of her employer, SAUDIA, she asked the
Philippine Embassy in Jeddah to help her while her case is on appeal. She
continued to workon the domestic flight of SAUDIA, while Thamer and Allah
continued to serve in the international flights.
Because she was wrongfully convicted, the Prince of Makkah dismissed the
case against her and allowed her to leave Saudi Arabia. Before her return to
Manila, she was terminated from the service by SAUDIA, without her being
informed of the cause.
November 23, 1993: Morada filed a Complaint for damages against SAUDIA,
and Khaled Al-Balawi, its country manager.
January 19, 1994: SAUDIA filed an Omnibus Motion To Dismiss on following
grounds: (1) that the Complaint states no cause of action against SAUDIA (2)
that defendant Al-Balawi is not a real party in interest (3) that the claim or
demand set forth in the Complaint has been waived, abandoned or otherwise
extinguished and (4) that the trial court has no jurisdiction to try the case.
After opposition to the motion to dismiss by Morada and reply by SAUDIA,
Morada filed an Amended Complaint dropping Al-Balawi. SAUDIA filed its
Manifestation, Motion to Dismiss Amended Complaint, subsequently motion
for reconsideration which were all denied.
SAUDIA filed its Petition for Certiorari and Prohibition with Prayer for
Issuance of Writ of Preliminary Injunction and/or Temporary Restraining
Order with the Court of Appeals. TRO was granted but Writ of Preliminary
Injunction was denied.
CA: Philippines is an appropriate forum considering that the Amended
Complaint's basis for recovery of damages is Article 21 of the Civil Code, and
thus, clearly within the jurisdiction of respondent Court. It further held that
certiorari is not the proper remedy in a denial of a Motion to Dismiss,
inasmuch as the petitioner should have proceeded to trial, and in case of an
adverse ruling, find recourse in an appeal.
SAUDIA filed its Supplemental Petition for Review with Prayer for Temporary
Restraining Order:
o It is a conflict of laws that must be settled at the outset:
§ Morada's claim for alleged abuse of rights occurred in the Kingdom of
Saudi Arabia.
§ Existence of a foreign element qualifies the instant case for the application
of the law of the Kingdom of Saudi Arabia, by virtue of the lex loci delicti
commissi rule.
Morada: Amended Complaint is based on Articles 19 and 21 of the Civil
Code which is a matter of domestic law
ISSUE: W/N the RTC of Quezon City has jurisdiction over the case and it is
the proper forum for recovery of damages under Art. 21 of the Civil Code
which should govern.
HELD: YES. petition for certiorari is hereby DISMISSED. REMANDED to
RTC of Quezon City, Branch 89 for further proceedings
Where the factual antecedents satisfactorily establish the existence of a
foreign element, the problem could present a "conflicts" case
A factual situation that cuts across territorial lines and is affected by the
diverse laws of two or more states is said to contain a "foreign element".
o Morada is a resident Philippine national
o SAUDIA is a resident foreign corporation
o by virtue of the employment of Morada with the SAUDIA as a flight
stewardess, events did transpire during her many occasions of travel across
national borders, particularly from Manila, Philippines to Jeddah, Saudi
Arabia, and vice versa, that caused a "conflicts" situation to arise
Forms of foreign element:
o Simple: one of the parties to a contract is an alien or has a foreign
domicile, or that a contract between nationals of one State involves
properties situated in another State
o Complex
Violations of Articles 19 and 21 are actionable, with judicially enforceable
remedies in the municipal forum. RTC of Quezon City possesses jurisdiction
over the subject matter of the suit.
Pragmatic considerations, including the convenience of the parties, also
weigh heavily in favor of the RTC Quezon City assuming jurisdiction:
o private interest of the litigant
o enforceability of a judgment if one is obtained
o relative advantages and obstacles to a fair trial
§ Plaintiff may not, by choice of an inconvenient forum, "vex", "harass", or
"oppress" the defendant, e.g. by inflicting upon him needless expense or
disturbance. but unless the balance is strongly in favor of the defendant, the
plaintiffs choice of forum should rarely be disturbed.
Weighing the relative claims of the parties, the court a quo found it best to
hear the case in the Philippines. Had it refused to take cognizance of the
case, it would be forcing plaintiff (private respondent now) to seek remedial
action elsewhere, i.e. in the Kingdom of Saudi Arabia where she no longer
maintains substantial connections. That would have caused a fundamental
unfairness to her. Moreover, by hearing the case in the Philippines no
unnecessary difficulties and inconvenience have been shown by either of the
parties.
Trial court possesses jurisdiction over the persons of the parties
o By filing her Complaint and Amended Complaint with the trial court,
private respondent has voluntary submitted herself to the jurisdiction of the
court
o SAUDIA has effectively submitted to the trial court's jurisdiction by
praying for the dismissal of the Amended Complaint on grounds other than
lack of jurisdiction.
As to the choice of applicable law, it seeks to answer 2 important questions:
o (1) What legal system should control a given situation where some of the
significant facts occurred in two or more states
o (2) to what extent should the chosen legal system regulate the situation
Although ideally, all choice-of-law theories should intrinsically advance both
notions of justice and predictability, they do not always do so. The forum is
then faced with the problem of deciding which of these two important values
should be stressed.
Before a choice can be made, it is necessary for us to determine under what
category a certain set of facts or rules fall
o "characterization" or the "doctrine of qualification”
§ process of deciding whether or not the facts relate to the kind of question
specified in a conflicts rule
§ purpose: to enable the forum to select the proper law
Choice-of-law rules invariably consist of: (essential element of conflict rules)
o factual situation/relationship or operative fact (such as property right,
contract claim); and
§ starting point of analysis
o test or connecting factor or point of contact (such as the situs of the res,
the place of celebration, the place of performance, or the place of
wrongdoing) – could be:
§ (1) The nationality of a person, his domicile, his residence, his place of
sojourn, or his origin
§ (2) the seat of a legal or juridical person, such as a corporation
§ (3) the situs of a thing, that is, the place where a thing is, or is deemed to
be situated. In particular, the lex situs is decisive when real rights are
involved
§ (4) the place where an act has been done, the locus actus, such as the
place where a contract has been made, a marriage celebrated, a will signed
or a tort committed. The lex loci actus is particularly important in contracts
and torts
§ (5) the place where an act is intended to come into effect, e.g., the place of
performance of contractual duties, or the place where a power of attorney is
to be exercised
§ (6) the intention of the contracting parties as to the law that should govern
their agreement, the lex loci intentionis;
§ (7) the place where judicial or administrative proceedings are instituted or
done. The lex fori — the law of the forum — is particularly important
because, as we have seen earlier, matters of "procedure" not going to the
substance of the claim involved are governed by it; and because the lex fori
applies whenever the content of the otherwise applicable foreign law is
excluded from application in a given case for the reason that it falls under
one of the exceptions to the applications of foreign law; and
§ (8) the flag of a ship, which in many cases is decisive of practically all legal
relationships of the ship and of its master or owner as such. It also covers
contractual relationships particularly contracts of affreightment
Note that one or more circumstances may be present to serve as the
possible test for the determination of the applicable law.
Based on pleadings on record, including allegations in the Amended
Complaint:
o Morada was made to face trial for very serious charges, including
adultery and violation of Islamic laws and tradition
o SAUDIA may have acted beyond its duties as employer by handing over
the person of Morada to Jeddah officials which contributed to and amplified
or even proximately caused additional humiliation, misery and suffering. It
also took advantage of the trust, confidence and faith in the guise of authority
as employer.
o Conviction and imprisonment was wrongful but injury or harm was
inflicted upon her person and reputation which must be compensated or
redress for the wrong doing
Complaint involving torts
"connecting factor" or "point of contact" - place or places where the tortious
conduct or lex loci actus occurred = Philippines where SAUDIA deceived
Morada, a Filipina residing and working here.
"State of the most significant relationship" – applied
o taken into account and evaluated according to their relative importance
with respect to the particular issue:
§ (a) the place where the injury occurred
§ (b) the place where the conduct causing the injury occurred
§ (c) the domicile, residence, nationality, place of incorporation and place of
business of the parties
§ (d) the place where the relationship, if any, between the parties is centered
v private respondent is a resident Filipina national, working here
v a resident foreign corporation engaged here in the business of
international air carriage.
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SAUDI ARABIAN AIRLINES VS. COURT OF APPEALS,
297 SCRA 469
1998
FACTS:
Herein private respondent Milagros P. Morada is a flight attendant for
petitioner SAUDIA airlines, where the former was tried to be raped by
Thamer and Allah AlGazzawi, both Sauidi nationals and fellow crew member,
after a night of dancing in their hotel while in Jakarta, Indonesia. She was
rescued. After two weeks of detention the accused were both deported to
Saudi and they were reinstated by Saudia. She was pressured by police
officers to make a statement and to drop the case against the accused; in
return she will then be allowed to return to Manila and retrieved her passport.
For the second time, she was asked by her superiors to again appear before
the Saudi court. Without her knowledge, she was already tried by Saudi
court together with the accused and was sentenced to five months
imprisonment and to 286 lashes in connection with Jakarta rape incident.
The court found her guilty of (1) adultery; (2) going to a disco, dancing and
listening to the music in violation of Islamic laws; and (3) socializing with the
male crew, in contravention of Islamic tradition.
ISSUE/S: WHETHER OR NOT the QC Regional Trial Court has
jurisdiction to hear and try the civil case based on Article 21 of the New Civil
Code or the Kingdom of Saudi Arabia court though there is the existence of
foreign element.
RULING:
The forms in which a foreign element may appear are many, such as the fact
that one party is a resident Philippine national, and that the other is a
resident foreign corporation. The forms in which this foreign element may
appear are many. The foreign element may simply consist in the fact that one
of the parties to a contract is an alien or has a foreign domicile, or that a
contract between nationals of one State involves properties situated in
another State. In other cases, the foreign element may assume a complex
form. In the instant case, the foreign element consisted in the fact that private
respondent Morada is a resident Philippine national, and that petitioner
SAUDIA is a resident foreign corporation. Also, by virtue of the employment
of Morada with the petitioner SAUDIA as a flight stewardess, events did
transpire during her many occasions of travel across national borders,
particularly from Manila, Philippines to Jeddah, Saudi Arabia, and vice versa,
that caused a “conflicts” situation to arise.
The forms in which a foreign element may appear are many, such as the fact
that one party is a resident Philippine national, and that the other is a
resident foreign corporation. The forms in which this foreign element may
appear are many. The foreign element may simply consist in the fact that one
of the parties to a contract is an alien or has a foreign domicile, or that a
contract between nationals of one State involves properties situated in
another State. In other cases, the foreign element may assume a complex
form. In the instant case, the foreign element consisted in the fact that private
respondent Morada is a resident Philippine national, and that petitioner
SAUDIA is a resident foreign corporation. Also, by virtue of the employment
of Morada with the petitioner SAUDIA as a flight stewardess, events did
transpire during her many occasions of travel across national borders,
particularly from Manila, Philippines to Jeddah, Saudi Arabia, and vice versa,
that caused a “conflicts” situation to arise.
Where the factual antecedents satisfactorily establish the existence of a
foreign element, the problem could present a “conflicts” case. Where the
factual antecedents satisfactorily establish the existence of a foreign
element, we agree with petitioner that the problem herein could present a
“conflicts” case. A factual situation that cuts across territorial lines and is
affected by the diverse laws of two or more states is said to contain a “foreign
element.” The presence of a foreign element is inevitable since social and
economic affairs of individuals and associations are rarely confined to the
geographic limits of their birth or conception.
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3. Bellis vs Bellis, G.R. No. L-23678 June 6, 1967
TESTATE ESTATE OF AMOS G. BELLIS, deceased, PEOPLE’S 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 People’s 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
“Executor’s 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 testator’s 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.
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4. CASE DIGEST: BELLIS VS. BELLIS
1 Reply
G.R. No. L-23678 (June 6, 1967)
Testate of Amos Bellis vs. Edward A. Bellis, et al
FACTS:
Amos G. Bellis was a citizen of the State of Texas and of the United States.
He had five legitimate children with his first wife (whom he divorced), three
legitimate children with his second wife (who survived him) and, finally, three
illegitimate children.
6 years prior Amos Bellis’ death, he executed two(2) wills, apportioning the
remainder of his estate and properties to his seven surviving children. The
appellants filed their oppositions to the project of partition claiming that they
have been deprived of their legitimes to which they were entitled according to
the Philippine law. Appellants argued that the deceased wanted his
Philippine estate to be governed by the Philippine law, thus the creation of
two separate wills.
ISSUE:
Whether or not the Philippine law be applied in the case in the determination
of the illegitimate children’s successional rights
RULING:
Court ruled that provision in a foreigner’s will to the effect that his properties
shall be distributed in accordance with Philippine law and not with his
national law, is illegal and void, for his national law cannot be ignored in view
of those matters that Article 10 — now Article 16 — of the Civil Code states
said national law should govern.
Where the testator was a citizen of Texas and domiciled in Texas, the
intrinsic validity of his will should be governed by his national law. Since
Texas law does not require legitimes, then his will, which deprived his
illegitimate children of the legitimes, is valid.
The Supreme Court held that the illegitimate children are not entitled to the
legitimes under the texas law, which is the national law of the deceased.
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4. GOVERNMENT VS. FRANK
MARCH 28, 2013 ~ VBDIAZ
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
(1) the Government of the Philippine Islands had amended Laws No. 80 and
No. 224 and had thereby materially altered the said contract, and also that
(2) he was a minor at the time the contract was entered into and was
therefore not responsible under the law.
the lower court rendered a judgment against Frank and in favor of the
Plaintiff for the sum of 265. 90 dollars
ISSUE:
1. Did the amendment of the laws altered the tenor of the contract entered
into between Plaintiff and Defendant?
2. Can the defendant allege minority/infancy?
HELD: the judgment of the lower court is affirmed
1. NO; It may be said that the mere fact that the legislative department of the
Government of the 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.
2. NO; The Defendant alleged in his special defense that he was a minor and
therefore the contract 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.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Civil Laws (NATIONALITY PRINCIPLE)
Gantuangco, Gilianne Kathryn L.
The Government of the Philippines Islands vs George I. Frank
G. R. No. 2935. March 23, 1909
ISSUE:
WON a contract entered into by a US citizen, when he was
considered as an adult in his country (USA) yet a minor in the Philippines, at
which time that he entered into the contract, is valid and enforceable under
the Philippine laws.
RULING:
YES.
Mr. Frank being fully qualified to enter into a contract at the place
and time the contract was made, he cannot therefore plead infancy as a
defense at the place where the contract is being enforced. Although Mr.
Frank was still a minor under Philippine laws, he was nevertheless
considered an adult under the laws of the state of Illinois,the place where the
contract was made. No rule is better settled in law than that matters bearing
upon the execution, interpretation and validity of a contract are determined
by the law of the place where the contract is made. Matters connected to its
performance are regulated by the law prevailing at the place of its
performance. Matters respecting a remedy, such as bringing of a suit,
admissibility of evidence, and statutes of limitations, depend upon the law of
the place where the suit is brought.
Although generally, capacity of the parties to enter into a contract is
governed by national law. This is one case not involving real property which
was decided by our Supreme Court, where instead of national law, what
should determine capacity to enter into a contract is the lex loci celebrationis.
According to Conflict of Laws writer Edgardo Paras, Frank’s capacity should
be judged by his national law and not by the law of the place where the
contract was entered into. In the instant case whether it is the place where
the contract was made or Frank’s nationality, the result would be the same.
However, as suggested by the mentioned author, for the conflicts rule in
capacity in general, national law of the parties is
controlling.
xXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXX
5. CADALIN ET AL VS. POEA ET AL
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 o’clock in the evening until seven o’clock 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 year’s 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 month’s 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:
1. WON the foreign law should govern or the contract of the
parties.(WON the complainants who have worked in Bahrain are entitled to
the above-mentioned benefits provided by Amiri Decree No. 23 of Bahrain).
2. WON the Bahrain Law should apply in the case. (Assuming it is
applicable WON complainants’ claim for the benefits provided therein have
prescribed.)
RULING:
1. NLRC set aside Section 1, Rule 129 of the 1989 Revised Rules on
Evidence governing the pleading and proof of a foreign law and admitted in
evidence a simple copy of the Bahrain’s 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.
2. NLRC ruled that the prescriptive period for the filing of the claims of
the complainants was 3 years, 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 forum’s 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:
(1) Upon a written contract; (2) Upon an obligation created by law; (3) Upon a
judgment” and was granted by HSBC Singapore branch an overdraft facility in the
In this case, the claim for pay differentials is primarily anchored on the written
maximum amount of Singapore dollars 200,000 with interest at 3% over
contracts between the litigants, the ten-year prescriptive period provided by
Art. 1144(l) of the New Civil Code should govern. HSBC prime rate, payable monthly, on amounts due under said overdraft
3. NO. A class suit is proper where the subject matter of the controversy is facility.
one of common or general interest to many and the parties are so numerous
that it is impracticable to bring them all before the court. When all the claims As a security for the repayment by the COMPANY of sums advanced by
are for benefits granted under the Bahrain law many of the claimants worked
outside Bahrain. Some of the claimants were deployed in Indonesia under HSBC to it through the aforesaid overdraft facility, in 1982, both private
different terms and condition of employment. respondents and a certain Lowe, all of whom were directors of the
Inasmuch as the First requirement of a class suit is not present (common or COMPANY at such time, executed a Joint and Several Guarantee in favor of
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 HSBC whereby private respondents and Lowe agreed to pay, jointly and
claims in a class suit.
severally, on demand all sums owed by the COMPANY to petitioner BANK
While there are common defendants (AIBC and BRII) and the nature of the
under the aforestated overdraft facility.
claims is the same (for employee’s 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 The Joint and Several Guarantee provides, inter alia, that:
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 This guarantee and all rights, obligations and liabilities arising hereunder
hundreds of them have abandoned their co-claimants and have entered into shall be construed and determined under and may be enforced in
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 accordance with the laws of the Republic of Singapore. We hereby agree
proceeding.
that the Courts of Singapore shall have jurisdiction over all disputes arising
WHEREFORE, all the three petitioners are DISMISSED.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX under this guarantee. …
6. HSBC VS. SHERMAN

The COMPANY failed to pay its obligation. Thus, HSBC demanded payment
MARCH 28, 2013 ~ VBDIAZ
and inasmuch as the private respondents still failed to pay, HSBC filed A
HONGKONG AND SHANGHAI BANKING CORPORATION (HSBC) vs.
complaint for collection of a sum of money against private respondents
SHERMAN et al
Sherman and Reloj before RTC of Quezon City.
G.R. No. 72494
Private respondents filed an MTD on the ground of lack of jurisdiction over
August 11, 1989
the subject matter. The trial court denied the motion. They then filed before
FACTS: It appears that sometime in 1981, Eastern Book Supply Service
the respondent IAC a petition for prohibition with preliminary injunction and/or
PTE, Ltd. (COMPANY), a company incorporated in Singapore applied with
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 latter’s 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.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
HSBC vs. Sherman
G.R. No. 72494, Aug. 11, 1989
o Choice-of-forum clause
o Jurisdiction and Venue
o Parties can stipulate as to their choice of venue. But if the stipulation is not
restrictive, it shall be treated as merely permissive and will not bar the other
party from airing the case in a different forum which has jurisdiction over the
subject matter.
FACTS:
Sometime in 1981, Eastern Book Supply PTE, Ltd. (Company), a company
incorporated in Singapore, applied with and was granted by the Singapore
Branch of HSBC an overdraft facility. To secure the overdraft facility, private
respondents who were directors of the Company executed a Joint and
Several Guarantee in favour of HSBC, which provides 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….”
However, when the Company failed to pay its obligation, HSBC filed this
action with the Philippine courts. In a Motion to Dismiss, the private
respondents raised the abovementioned provision of the Joint and Several
Guarantee. The trial court affirmed the plaintiffs but CA reversed, citing said
provision as basis.
ISSUE:
o Whether or not Philippine courts have jurisdiction over the suit
HELD:
The Supreme Court held that the clause in question did not operate to divest
the Philippine courts of jurisdiction.
While it is true that “the transaction took place in Singaporean setting” and
that the Joint and Several Guarantee contains a choice-of-forum clause, the
very essence of due process dictates that the stipulation that “[t]his
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 in
Singapore shall have jurisdiction over all disputes arising under this
guarantee” be liberally construed. 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. Indeed, as pointed-out by
petitioner BANK at the outset, the instant case presents a very odd situation.
In the ordinary habits of life, anyone would be disinclined to litigate before a
foreign tribunal, with more reason as a defendant. However, in this case,
private respondents are Philippine residents (a fact which was not disputed
by them) who would rather face a complaint against them before a foreign
court and in the process incur considerable expenses, not to mention
inconvenience, than to have a Philippine court try and resolve the case.
Private respondents' stance is hardly comprehensible, unless their ultimate
intent is to evade, or at least delay, the payment of a just obligation.
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.
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 latter's 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.

Minimum Contract: Hongkong and Shanghai Banking Corporation vs. Jack
Robert Sherman G.R. No. 7249411 August 1989 Medialdea, J:
Facts
: Eastern Book Supply Service PTE, Ltd., a company incorporated in
Singapore applied with, and was granted by, the Hongkong and Shanghai
Banking Corporation Singapore branch an overdraft facility in the maximum
amount of Singapore dollars 200,000.00 (which amount was subsequently
increased to Singapore dollar 375,000.00). As a security for the repayment
by the COMPANY of the sum advanced, Jack Robert Sherman and Deodato
Reloj, herein private respondents, and a certain Robin de Clive Lowe, all of
whom were directors of said COMPANY at such time, executed a Joint and
Several Guarantee in favor of petitioner BANK whereby they 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 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 overall
disputes arising under this guarantee . . ."The COMPANY failed to pay its
obligation. Thus, petitioner BANK demanded payment from the private
respondents, conformably with the provisions of the Joint and Several
Guarantee. Inasmuch as the private respondents still failed to pay, petitioner
BANK filed a civil case for a collection of a sum of money against Sherman
and Reloj before the Regional Trial Court of Quezon City. In turn, the private
respondents filed a motion to dismiss on the ground of lack of jurisdiction
over the subject matter of the complaint and over the persons of the
defendants, but, it was denied. Subsequently, the court granted the petition
for prohibition with preliminary injunction. Hence, this petition for review on
certiorari.
Issue
: Whether or not Philippine courts have jurisdiction over the suit.
Held
: Yes. The parties did not 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. InInternational Law,
jurisdiction is often defined as the right of a State to exercise authority over
personsand things within its boundaries subject to certain exceptions. This
authority, which finds its source inthe concept of sovereignty, is exclusive
within and throughout the domain of the State. A State iscompetent 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.
While it is true that “the transaction took place in Singaporean setting” and
that the Joint and Several Guarantee contains a choice-of-forum clause, the
very essence of due process dictates that thestipulation be liberally
construed. One basic principle underlies all rules of jurisdiction in
InternationalLaw: 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 jurisdictionmust be based on
some minimum contacts that will not offend traditional notions of fair play
andsubstantial justice.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
7. El Banco Espanol-Filipino vs. Vicente Palanca G.R. No. L-11390,
March 26, 1918
El Banco Espanol-Filipino vs. Palanca
G.R. No. L-11390, March 26, 1918
* JURISDICTION, HOW ACQUIRED: Jurisdiction over the property which is
the subject of the litigation may result either from a seizure of the property
under legal process, whereby it is brought into the actual custody of the law,
or it may result from the institution of legal proceedings wherein, under
special provisions of law, the power of the court over the property is
recognized and made effective.
* The action to foreclose a mortgage is said to be a proceeding quasi in rem,
by which is expressed the idea that while it is not strictly speaking an action
in rem yet it partakes of that nature and is substantially such.
* DUE PROCESS IN FORECLOSURE PROCEEDINGS: Property is always
assumed to be in the possession of its owner, in person or by agent; and he
may be safely held, under certain conditions, to be affected with knowledge
that proceedings have been instituted for its condemnation and sale.
FACTS:
Engracio Palanca Tanquinyeng y Limquingco mortgaged various parcels of
real property in Manila to El Banco Espanol-Filipino. Afterwards, Engracio
returned to China and there he died on January 29, 1810 without returning
again to the Philippines. The mortgagor then instituted foreclosure
proceeding but since defendant is a non-resident, it was necessary to give
notice by publication. The Clerk of Court was also directed to send copy of
the summons to the defendant’s last known address, which is in Amoy,
China. It is not shown whether the Clerk complied with this requirement.
Nevertheless, after publication in a newspaper of the City of Manila, the
cause proceeded and judgment by default was rendered. The decision was
likewise published and afterwards sale by public auction was held with the
bank as the highest bidder. On August 7, 1908, this sale was confirmed by
the court. However, about seven years after the confirmation of this sale, a
motion was made by Vicente Palanca, as administrator of the estate of the
original defendant, wherein the applicant requested the court to set aside the
order of default and the judgment, and to vacate all the proceedings
subsequent thereto. The basis of this application was that the order of default
and the judgment rendered thereon were void because the court had never
acquired jurisdiction over the defendant or over the subject of the action.
ISSUE:
* Whether or not the lower court acquired jurisdiction over the defendant and
the subject matter of the action
* Whether or not due process of law was observed
RULING:
On Jurisdiction
The word “jurisdiction” is used in several different, though related, senses
since it may have reference (1) to the authority of the court to entertain a
particular kind of action or to administer a particular kind of relief, or it may
refer to the power of the court over the parties, or (2) over the property which
is the subject to the litigation.
The sovereign authority which organizes a court determines the nature and
extent of its powers in general and thus fixes its competency or jurisdiction
with reference to the actions which it may entertain and the relief it may
grant.
How Jurisdiction is Acquired
Jurisdiction over the person is acquired by the voluntary appearance of a
party in court and his submission to its authority, or it is acquired by the
coercive power of legal process exerted over the person.
Jurisdiction over the property which is the subject of the litigation may result
either from a seizure of the property under legal process, whereby it is
brought into the actual custody of the law, or it may result from the institution
of legal proceedings wherein, under special provisions of law, the power of
the court over the property is recognized and made effective. In the latter
case the property, though at all times within the potential power of the court,
may never be taken into actual custody at all. An illustration of the jurisdiction
acquired by actual seizure is found in attachment proceedings, where the
property is seized at the beginning of the action, or some subsequent stage
of its progress, and held to abide the final event of the litigation. An
illustration of what we term potential jurisdiction over the res, is found in the
proceeding to register the title of land under our system for the registration of
land. Here the court, without taking actual physical control over the property
assumes, at the instance of some person claiming to be owner, to exercise a
jurisdiction in rem over the property and to adjudicate the title in favor of the
petitioner against all the world.
In the terminology of American law the action to foreclose a mortgage is said
to be a proceeding quasi in rem, by which is expressed the idea that while it
is not strictly speaking an action in rem yet it partakes of that nature and is
substantially such. The expression "action in rem" is, in its narrow
application, used only with reference to certain proceedings in courts of
admiralty wherein the property alone is treated as responsible for the claim or
obligation upon which the proceedings are based. The action quasi rem
differs from the true action in rem in the circumstance that in the former an
individual is named as defendant, and the purpose of the proceeding is to
subject his interest therein to the obligation or lien burdening the property. All
proceedings having for their sole object the sale or other disposition of the
property of the defendant, whether by attachment, foreclosure, or other form
of remedy, are in a general way thus designated. The judgment entered in
these proceedings is conclusive only between the parties.
It is true that in proceedings of this character, if the defendant for whom
publication is made appears, the action becomes as to him a personal action
and is conducted as such. This, however, does not affect the proposition that
where the defendant fails to appear the action is quasi in rem; and it should
therefore be considered with reference to the principles governing actions in
rem.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
8. EN BANC
G.R. No. L-5675 April 27, 1953
ANTONIO CARBALLO, Petitioner, vs. DEMETRIO B. ENCARNACION in
his capacity as Judge of First Instance of Manila and MARIANO
ANG, Respondents.
J. Gonzales Orense for petitioner.
Antonio Gonzales for respondents.
MONTEMAYOR, J.:
In the Municipal Court of Manila, Mariano Ang filed a complaint (civil case
No. 8769) against Antonio Carballo for the collection of P1,860.84. The
corresponding summons was served upon defendant Carballo for
appearance and trial on October 10, 1949. As counsel for him Atty. J.
Gonzales entered his written appearance on October 12, 1949. On the same
day said counsel filed a motion for postponement of the hearing for one
month on the ground that he was sick, attaching a medical certificate to
prove his illness. Hearing was postponed to October 14, 1949 at which time
defendant asked for another postponement on the ground that his counsel
was still sick. The hearing was again postponed to October 24, 1949. Inn
said last two postponement of the hearing, the municipal court warned the
defendant that the hearing could not wait until his counsel recovered from his
illness, and that if said counsel could not attend the trial he should obtain the
services of another lawyer.chanroblesvirtualawlibrary chanrobles virtual law
library
On the day set for hearing, namely, October 24, 1949, neither defendant nor
his counsel appeared although there was a written manifestation of
defendant's counsel requesting further postponement because he was still
sick. At the request of plaintiff's counsel, defendant was declared in default.
The evidence for the plaintiff was received after which judgment was
rendered against the defendant ordering him to pay the sum of P1,860 with
legal interest. Counsel for defendant was duly notified of said decision and
he filed a motion for new trial on the ground that injustice had been done,
and that an error was committed in the decision. The motion for new trial was
denied. Through his counsel defendant perfected his appeal to the Court of
First Instance of Manila and he later filed an
answer.chanroblesvirtualawlibrary chanrobles virtual law library
When the case was called for hearing on March 18, 1952, counsel for plaintiff
argued that the decision appealed from had become final and executory for
the reason that said judgment having been rendered by default, no appeal
could be validly taken from it. Despite opposition of the defendant, the Court
of First Instance in an order dated March 18, 1952, considering said decision
final and unappealable because it had been rendered by default, and held
that the only jurisdiction left to it was to order the execution of said decision,
so it ordered the return of the record to the municipal court for that
purpose.chanroblesvirtualawlibrary chanrobles virtual law library
Defendant Carballo filed a motion for reconsideration of the order dismissing
his appeal which motion was denied by an order 353 dated March 21, 1952,
whereupon Carballo filed the present petition for certiorari, injunction,
prohibition and mandamus wherein he asks that after due hearing the order
and actuations of respondent Judge Encarnacion of the Court of First
Instance of Manila be declared null and void; that he be ordered to desist
from executing said order and that furthermore, he be commanded to
proceed with the trial of the case "de novo."chanrobles virtual law library
We agree that a decision by default rendered by an inferior court is not
appealable (Lim Toco vs. Co. Fay, 1 45 Off. Gaz., No. 8, p. 3350). The
question now is whether defendant (now petitioner Carballo) defaulted in the
municipal court of Manila. True, he filed no answer, but his counsel filed a
written appearance. In addition, said counsel filed a motion or manifestation
asking for postponement of the hearing on the ground that he was ill. In the
case of Flores vs. Zurbito, (37 Phil., 746), this Court held that an appearance
in whatever form without expressly objecting to the jurisdiction of the court
over the person, is a submission to the jurisdiction of the court over the
person. It is, therefore, clear that petitioner Carballo made an appearance in
the municipal court. Could he then be declared in default just because he
filed no answer? The answer must be in the negative. In the case of Quinzan
vs. Arellano, 2 G.R. No. 4461, December 28, 1951, the Supreme Court said
that in the justice of the peace court failure to appear, not failure to answer is
the sole ground for default. What really happened in the municipal court was
that the defendant tho he filed no answer to the complaint, nevertheless, he
made his appearance and in writing at that, but because of his failure and
that of his counsel to appear on the date of the trial, a hearing ex-parte was
held and judgment was rendered thereafter. The judgment, therefore, was
not by default. So defendant Antonio Carballo had a right to appeal as in fact
he appealed, and the Court of First Instance should not have declared the
decision appealed from final and executory under the theory that it was not
appealable.chanroblesvirtualawlibrary chanrobles virtual law library
The present petition is granted and the respondent judge is hereby directed
to proceed with the trial of the case. Respondent Mariano Ang will pay the
costs.chanroblesvirtualawlibrary chanrobles virtual law library
Paras, C.J., Feria, Pablo, Bengzon, Tuason, and Labrador, JJ., concur.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
10. Gemperle vs. Schenker
G.R. No. L-18164; January 23, 1967
Facts:
This case was the result of William Gemperle’s retaliatory act when
respondent spouses Paul and Helen Schenker filed a case against him for
the enforcement of Schenker's allegedly initial subscription to the shares of
stock of the Philippines-Swiss Trading Co., Inc. and the exercise of his 3. The spouse is appointed as attorney-in-fact of the spouse defendant in
alleged pre-emptive rights to the then unissued original capital stock of said a previous case involving the non-resident spouse.
corporation and the increase thereof, as well as for an accounting and XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
damages. Petitioner alleged that the said complaint tainted his name as a
businessman. He then filed a complaint for damages and prays for the 11. G.R. No. L-1403 October 29, 1948
retraction of statements made by Helen Schenker.
Summons was personally served to Helen Schenker but not to Paul VICENTE CALUAG and JULIANA GARCIA vs. POTENCIANO PECSON
Schenker. Helen then filed an answer with a counterclaim, but Paul Schenker and ANGEL H. MOJICA, Judges of the Court of First Instance of
filed a motion to dismiss arguing that the court never acquired jurisdiction Bulacan, and LEON ALEJO
over his person since admittedly, he is a Swiss citizen, residing in Zurich,
Switzerland, and has not been actually served with summons in the
Philippines. FACTS: On August 10, 1937, Alejo filed a complaint against Caluag and
Garcia for the redemption of one-half pro indiviso of a parcel of land in
Issue: Guiguinto, Bulacan. After trial, the CFI Bulacan rendered judgment ordering
petitioners to execute a deed of sale in favor of Fortunato Alejo, upon
Whether or not the court acquired jurisdiction over the person of Paul payment by plaintiff, as purchase price, of the amount of P2,551. Petitioners
Schenker. filed an appeal to the CA but it was denied. Consequently, Alejo filed a
Motion for Execution.
Ruling:
When the petitioners opposed, Alejo filed before CFI a petition for
Yes, although as a rule, when the defendant is a non-resident and in contempt and it was granted by the respondent. A petition for certiorari was
an accion in personam, jurisdiction over the person of the defendant can be filed against the respondent judge, allegedly acted without or in excess of the
acquired only through voluntary appearance or personal service of jurisdiction of the court in rendering the resolution which declares the
summons. But this case is an exception to the said rule. The Supreme petitioners guilty of contempt of court for not complying or performing its prior
ratiocinated: order requiring the petitioners to execute a deed of sale in favor of plaintiff
over one-half of the land pro indiviso in question. The petitioners in support
“We hold that the lower court had acquired jurisdiction over said defendant, of the present petition for certiorari, alleged other 2 grounds, to wit: (1) that
through service of the summons addressed to him upon Mrs. Schenker, it plaintiff's action abated or was extinguished upon the death of the plaintiff
appearing from said answer that she is the representative and attorney-in- Fortunato Alejo, because his right of legal redemption was a personal one,
fact of her husband aforementioned civil case No. Q-2796, which apparently and therefore not transferable to his successors in interest; and (2) that,
was filed at her behest, in her aforementioned representative capacity. In even assuming that it is a personal one and therefore transferable, his
other words, Mrs. Schenker had authority to sue, and had actually sued on successors in interest have failed to secure the substitution of said deceased
behalf of her husband, so that she was, also, empowered to represent him in by his legal representative under section 17, Rule 3.
suits filed against him, particularly in a case, like the of the one at bar, which
is consequence of the action brought by her on his behalf.” ISSUE: WON respondent Judge Angel Mojica acted without jurisdiction in
proceeding against and declaring the petitioners guilty of contempt.
Briefly, in an accion in personam where the defendant is a non-resident,
substituted service of summons does not apply. However, by way of HELD: Yes
exception, substituted service of summons may be effected, if the following
requisites are present: RATIO: It is well settled that jurisdiction of the subject matter of a particular
case is something more than the general power conferred by law upon a
1. The summons is served to the spouse of the defendant court to take cognizance of cases of the general class to which the particular
case belongs. The respondent Judge Mojica acted not only without
2. The spouse must be residing in the Philippines jurisdiction in proceeding against and declaring the petitioners guilty of
contempt, but also in excess of jurisdiction in ordering the confinement of the
petitioners, because it had no power to impose such punishment upon the
latter. The respondent judge has no power under the law to order the
confinement of the petitioners until they have compiled with the order of the
court. thereon. Summons by publication were served upon the nonresident

defendants Idonah Perkins and Engelhard. Engelhard filed his answer.

A wrong decision made within the limits of the court's authority is erroneous
and may be corrected on appeal or other direct review, but a wrong, or for Petitioner filed her answer with a crosscomplaint in which she sets up a
that matter a correct, decision is void, and may be set aside either directly or
collaterally, where the court exceeds its jurisdiction and power in rendering it. judgment allegedly obtained by her against respondent Eugene Perkins, from
Hence though the court has acquired jurisdiction over the subject matter and
the particular case has been submitted properly to it for hearing and decision, the SC of the State of New York, wherein it is declared that she is the sole
it will overstep its jurisdiction if it renders a judgment which it has no power
under the law to render. legal owner and entitled to the possession and control of the shares of stock
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX in question with all the cash dividends declared thereon by the Benguet

12. PERKINS VS. ROXAS Consolidated Mining Company.

MARCH 28, 2013 ~ VBDIAZ

Idonah Perkins filed a demurrer thereto on the ground that “the court has no
IDONAH PERKINS vs. ROXAS ET AL.
jurisdiction of the subject of the action,” because the alleged judgment of the
GRN 47517, June 27, 1941
SC of the State of New York is res judicata. Petitioner’s demurrer was
FACTS:
overruled, thus this petition.
July 5, 1938, respondent Eugene Perkins filed a complaint in the CFI- Manila

against the Benguet Consolidated Mining Company for the recovery of a sum
ISSUE:
consisting of dividends which have been declared and made payable on
WON in view of the alleged judgment entered in favor of the petitioner by the
shares of stock registered in his name, payment of which was being withheld
SC of New York and which is claimed by her to be res judicata on all
by the company, and for the recognition of his right to the control and
questions raised by the respondent, Eugene Perkins, the local court has
disposal of said shares to the exclusion of all others. The company alleged,
jurisdiction over the subject matter of the action.
by way of defense that the withholding of plaintiff’s right to the disposal and
RULING:
control of the shares was due to certain demands made with respect to said
By jurisdiction over the subject matter is meant the nature of the cause of
shares by the petitioner Idonah Perkins, and by one Engelhard.
action and of the relief sought, and this is conferred by the sovereign
Eugene Perkins included in his modified complaint as parties defendants
authority which organizes the court, and is to be sought for in general nature
petitioner, Idonah Perkins, and Engelhard. Eugene Perkins prayed that
of its powers, or in authority specially conferred. In the present case, the
petitioner Idonah Perkins and H. Engelhard be adjudged without interest in
amended complaint filed by the respondent, Eugene Perkins alleged calls for
the shares of stock in question and excluded from any claim they assert
the adjudication of title to certain shares of stock of the Benguet
Consolidated Mining Company and the granting of affirmative reliefs, which but its determination of the question, which the petitioner here anticipates

fall within the general jurisdiction of the CFI- Manila. Similarly CFI- Manila is and seeks to prevent, is the exercise by that court and the rightful exercise of

empowered to adjudicate the several demands contained in petitioner’s its jurisdiction.

crosscomplaint.

Idonah Perkins in her crosscomplaint brought suit against Eugene Perkins Petition denied.

and the Benguet Consolidated Mining Company upon the alleged judgment

of the SC of the State of New York and asked the court below to render

judgment enforcing that New York judgment, and to issue execution thereon.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
This is a form of action recognized by section 309 of the Code of Civil

Procedure (now section 47, Rule 39, Rules of Court) and which falls within
13. First Philippine International Bank vs. CA Case Digest GR 115849 ;
the general jurisdiction of the CFI- Manila, to adjudicate, settle and
January 24, 1996 ; 252 SCRA 259
determine.

DOCTRINE/S:
The petitioner expresses the fear that the respondent judge may render

judgment “annulling the final, subsisting, valid judgment rendered and

Conflict of Laws a)Principle of forum non conveniens - provides that a court,
entered in this petitioner’s favor by the courts of the State of New York, which
in conflicts of law cases, may refuse impositions on its jurisdiction where it is
decision is res judicata on all the questions constituting the subject matter of
not the most “convenient” or available forum and the parties are not
civil case” and argues on the assumption that the respondent judge is without
precluded from seeking remedies elsewhere.
jurisdiction to take cognizance of the cause. Whether or not the respondent

judge in the course of the proceedings will give validity and efficacy to the
FACTS: The Bank has been under conservatorship since 1984. It is the
New York judgment set up by the petitioner in her cross-complaint is a
owner of 6 parcels of land. The Bank had an agreement with Demetria to
question that goes to the merits of the controversy and relates to the rights of
purchase the parcels of land. The said agreement was made by Demetria
the parties as between each other, and not to the jurisdiction or power of the
with the Bank’s manager, Rivera. Thereafter, they had a series of letters
court. The test of jurisdiction is whether or not the tribunal has power to enter
consisting of offers, counter-offers and acceptance of the counter- offer by
upon the inquiry, not whether its conclusion in the course of it is right or
Demetria. Later however, the Bank, through its conservator, Encarnacion,
wrong. If its decision is erroneous, its judgment can be reversed on appeal;
sought the repudiation of the agreement as it alleged that Rivera was not
 authorized to enter into such an agreement. Hence there was no valid
contract of sale. Subsequently, Demetria sued the Bank. The RTC ruled in
favor of Demetria. The Bank filed an appeal with the Court of Appeals.
Meanwhile, Henry Co, who holds 80% shares of stocks with the said Bank,
filed a motion for intervention with the trial court which was denied since the
trial has been concluded already and the case is now pending appeal.
Subsequently, Henry Co, filed a separate civil case against Ejercito as
successor-in-interest (assignee) of Demetria seeking to have the purported
contract of sale be declared unenforceable against the Bank. Ejercito argued
that the second case constitutes forum shopping since it was barred by litis
pendentia by virtue of the case then pending in the Court of Appeals. But
petitioners explain that there is no forum-shopping because in the “First
Case” from which this proceeding arose, the Bank was impleaded as a
defendant, whereas in the “Second Case” it was the plaintiff. The Bank also
argued the following: (1) that there contract of sale was not yet perfected
since it lacks cosent since the Bank did not make a counter-offer; (2) that the
contract is unenforceable since there is no note, memorandum or writing
subscribed by the Bank to evidence such contract; (3) that the conservator
has the power to revoke or overrule actions of the management or the board
of directors of a bank under Section 28-A of Republic Act No. 265 hence the
conservator can revoke the said contract between the Bank and Demetria;
and (4) that respondent Court's Decision as "fraught with findings and
conclusions which were not only contrary to the evidence on record but have
no bases at all" hence questions of fact must be reviewed by SC.
ISSUE/S: 1) WON there is forum shopping. 2) WON there was a perfected
contract. 3) WON the contract is enforceable 4) WON the conservator may
revoke a perfected and enforceable contract. 5) WON SC should review
questions of fact
HELD: 1) YES. Forum-shopping is whenever, as a result of an adverse
opinion in one forum, a party seeks a favorable opinion (other than by appeal
or certiorari) in another. Forum shopping exists where the elements of litis
pendentia are present namely: (1) identity of parties, or at least such parties
as represent the same interests in both actions, as well as (2) identity of
rights asserted and relief prayed for, (3) the relief being founded on the same
facts, and the (4) identity on the two preceding particulars is such that any
judgment rendered in the other action, will, regardless of which party is
successful, amount to res adjudicata in the action under consideration.
In the instant case, there is forum shopping because there exist identity of
parties or interests represented, identity of rights or causes and identity of
reliefs sought between the first case and the second case. There is identity of
parties even though the first case is in the name of the bank as
defendant, and the second case is in the name of Henry Co as plaintiff since
the rule applies even if the the defendant in the first case becomes the
plaintiff in the second case. Furthermore, allegations of the complaint in the
Second Case show that the stockholders are bringing a "derivative suit".
Being a derivative suit would mean that Henry Co in filing the case is really
representing the Bank. So, whether they sued "derivatively" or directly, there
is undeniably an identity of interests/entity represented. There is also identity
of relief being sought since both cases seeks to enable the petitioner Bank to
escape from the obligation to sell the property to respondent.
2) YES. Article 1318 of the Civil Code enumerates the requisites of a valid
and perfected contract as follows: "(1) Consent of the contracting parties; (2)
Object certain which is the subject matter of the contract; (3) Cause of the
obligation which is established." In this case, there is consent since there
was meeting of the minds between the parties as shown by the fact that the
bank made a counter-offer after the Demetria made an offer to them. This
counteroffer was accepted by Demetria. The object of the subject contract is
the 6 parcels of land. The cause of the obligation for the petitioner bank is the
Php 5.5M that Demetria will pay for the land while the cause of the obligation
for Demetria is the capacity to own the subject land.
3) YES. A contract of sale is binding in whatever form it may have been
entered into. Hence, the letters constitute sufficient memoranda — since they
include the names of the parties, the terms and conditions of the contract, the
price and a description of the property as the object of the contract.
4) NO. Section 28-A of Republic Act No. 265 (otherwise known as the
Central Bank Act) merely gives the conservator power to revoke contracts
that are, under existing law, deemed to be defective — i.e., void, voidable,
unenforceable or rescissible. The contract in this case is a calid one. Hence
he cannot simply repudiate valid obligations of the Bank. Furthermore, the
conservator’s powers must be related to the "(preservation of) the assets of
the bank, (the reorganization of) the management thereof and (the
restoration of) its viability." Such powers cannot extend to the post-facto
repudiation of perfected transactions, otherwise they would infringe against
the non-impairment clause of the Constitution. Hence, the conservator must
exercise his powers without violating the non-impariment clause in the
constitution. If the conservator in this case would revoke the valid contract
between the Bank and Demetria then such act of the conservator would
consist as a violation of the non-impairment clause in the Constitution.
5) NO. The general rule is that the Supreme Court can only review questions
of law. This is provided under Rule 45 of the Rules of Court. The exceptions
to this rule are as follows: finding grounded entirely on speculation, surmises
or conjectures; when the inference made is manifestly absurd, mistaken or
impossible; when there is grave abuse of discretion in the appreciation of
facts; when the judgment is premised on a misapprehension of facts; when
the findings went beyond the issues of the case and the same are contrary to
the admissions of both appellant and appellee. In the instant case, it is quite
evident that the legal conclusions arrived at from the findings of fact by the
lower courts are valid and correct. Hence this Court cannot disturb these
findings to fit the conclusion the peititoner Bank is espousing.
Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
14. G.R. No. L-32636 March 17, 1930
In the matter Estate of Edward Randolph Hix, deceased.
A.W. FLUEMER, petitioner-appellant,
vs.
ANNIE COUSHING HIX, oppositor-appellee.
MALCOLM, J.:
FACTS: Fleumer, the special administrator of the estate of Edward Randolph
Hix appealed from a decision of Judge of First Instance Tuason denying the
probate of the document alleged to by the last will and testament of the
deceased. Appellee is not authorized to carry on this appeal. We think,
however, that the appellant, who appears to have been the moving party in
these proceedings, was a "person interested in the allowance or
disallowance of a will by a Court of First Instance," and so should be
permitted to appeal to the Supreme Court from the disallowance of the will
(Code of Civil Procedure, sec. 781, as amended; Villanueva vs. De Leon
[1925], 42 Phil., 780).
It is theory of the petitioner that the alleged will was executed in
Elkins, West Virginia, on November 3, 1925, by Hix who had his residence in
that jurisdiction, and that the laws of West Verginia Code, Annotated, by
Hogg, Charles E., and as certified to by the Director of the National Library,
should govern.
ISSUE: Whether or not the laws of West Virginia should govern.
RULING: The laws of a foreign jurisdiction do not prove themselves in our
courts. the courts of the Philippine Islands are not authorized to take
American Union. Such laws must be proved as facts.(In re Estate of Johnson
[1918], 39 Phil., 156.) Here the requirements of the law were not met. There
was no was printed or published under the authority of the State of West
Virginia, as provided in section 300 of the Code of Civil Procedure. Nor was
the extract from the law attested by the certificate of the officer having charge
of the original, under the sale of the State of West Virginia, as provided in
section 301 of the Code of Civil Procedure. No evidence was introduced to
show that the extract from the laws of West Virginia was in force at the time
the alleged will was executed.
Note: In addition, the due execution of the will was not established.
The only evidence on this point is to be found in the testimony of the
petitioner. Aside from this, there was nothing to indicate that the will was
acknowledged by the testator in the presence of two competent witnesses, of
that these witnesses subscribed the will in the presence of the testator and of
each other as the law of West Virginia seems to require. On the supposition
that the witnesses to the will reside without the Philippine Islands, it would
then the duty of the petitioner to prove execution by some other means
(Code of Civil Procedure, sec. 633.)
It was also necessary for the petitioner to prove that the testator had
his domicile in West Virginia and not establish this fact consisted of the
recitals in the CATHY will and the testimony of the petitioner. Also in
beginning administration proceedings originally in the Philippine Islands, the
petitioner violated his own theory by attempting to have the principal
administration in the Philippine Islands.
While the appeal pending submission in this court, the attorney for
the appellant presented an unverified petition asking the court to accept as
part of the evidence the documents attached to the petition. One of these
documents discloses that a paper writing purporting to be the was presented
for probate on June 8, 1929, to the clerk of Randolph Country, State of West
Virginia, in vacation, and was duly proven by the oaths of Dana Wamsley
and Joseph L. MAdden, the subscribing witnesses thereto , and ordered to
be recorded and filed. It was shown by another document that, in vacation,
on June 8, 1929, the clerk of court of Randolph Country, West Virginia,
appointed Claude W. Maxwell as administrator, cum testamento annexo, of
the estate of Edward Randolph Hix, deceased. In this connection, it is to be
noted that the application for the probate of the will in the Philippines was
filed on February 20, 1929, while the proceedings in West Virginia appear to
have been initiated on June 8, 1929. These facts are strongly indicative of an
intention to make the Philippines the principal administration and West
Virginia the ancillary administration. However this may be, no attempt has
been made to comply with Civil Procedure, for no hearing on the question of
the allowance of a will said to have been proved and allowed in West Virginia
has been requested. There is no showing that the deceased left any property
at any place other than the Philippine Islands and no contention that he left
any in West Virginia.
Reference has been made by the parties to a divorce purported to
have been awarded Edward Randolph Hix from Annie Cousins Hix on
October 8, 1925, in the State of West specific pronouncements on the validity
or validity of this alleged divorce.
For all of the foregoing, the judgment appealed from will be affirmed,
with the costs of this instance against the appellant.
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15. Davao Light v. CA
Gr No. 93262 Dec 29, 1991
Facts:
Davao Light filed a complaint for sum of money against Queensland Hotel
and Teodorico Adarna. The complaint contained an ex parte application for a
writ of preliminary attachment. The Judge granted and issued the writ of
attachment and the sheriff served the summon against Queensland Hotel.
The respondents contend that the preliminary attachment should not have
been issued because the court has not yet acquired jurisdiction over the
person of the defendants.
Issue:
Whether the writ of preliminary attachment may issue ex parte against a
defendant before acquisition of jurisdiction of the latter’s person by service of
summons or his voluntary submission to the court’s authority?
Held:
No. The plaintiff may apply for and obtain a writ of preliminary attachment
upon fulfilment of the pertinent requisites laid down by law and that he may
do so at any time, either before or after service of summons on the
defendant.
The court declared that nothing in the RoC makes notice and hearing
indispensable and mandatory requisites for the issuance of the writ of
attachment, the only pre requisite is that the court be satisfied, upon
consideration of the affidavit of the applicant or of some other person who
personally knows the facts that a sufficient cause of actions exists, that the
case is one of those mentioned in sec 1 rule 57, that there is no other
sufficient security for the claim sought to be enforced by the action, and that
the amount due to the applicant, or the value of the property the possession
of which he is entitled to recover, is as much as the sum for which the order
of attachment is granted above all legal counterclaims. If the court be so
satisfied, the order of attachment shall be granted, and the writ shall issue
upon the applicant’s posting of bond executed to the adverse party in an
amount to be fixed by the judge not exceeding the plaintiff’s claim,
conditioned that the latter will pay all the costs which may be adjudged to the
adverse party and all damages which he may sustain by reason of the
attachment, if the court shall finally adjudge that the applicant was not
entitled thereto.
Arguments for the Plaintiff
As the US courts have jurisdiction over the subject matter and the parties,
they have no choice but to try the case.
Issue
Whether or not the US courts may dismiss the case on the ground of forum
non conveniens.
Held
Yes. Under the circumstances, the case may be more suitably tried before
German courts.
Ratio Decidendi
The courts in both jurisdictions are competent to try the case and summons
may be served upon the insurance companies in both jurisdictions. Requiring
the insurance companies to defend their interests in the US would subject
them to great and unnecessary inconvenience and expenses, including the
possibility of having to bring documentary evidence all the way from their
office in Germany. Moreover, trying the case in the US additionally burden
the courts in that jurisdiction, to the detriment of other litigants. The
assumption of jurisdiction over a case the cause of action of which arose
from another jurisdiction and wherein both parties are non-residents is
discretionary upon the court.

2 ways of discharging the attachment:

1. By posting of a counterbond;
2. By showing of its improper or irregular issuance.

With respect to other provisional remedies; preliminary injunction rule 58;

receivership rule 59; replevin or delivery of personal property rule 60; the rule
is the same they may also be issued ex parte.
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16. Heine v. New York Life Insurance Company

Facts
The New York Life Insurance Company and the Guardian Insurance
Company ("the insurance companies") were corporations created in New
York, USA. As conditions to be allowed to conduct business in Germany,
they were made to agree to be supervised by German authorities, to invest
the proceeds of policies in German securities, and to establish a local agency
to whom summons may be served. The insurance companies were later
sued before courts in both the US and Germany for the recovery on some
240 life insurance policies issued in Germany to German nationals, payable
in German currency.