U.S.

Supreme Court
Perkins v. Benguet Consolidated Mining Co., 342 U.S. 437 (1952)

Perkins v. Benguet Consolidated Mining Co.

No. 85

Argued November 27-28, 1951

Decided March 3, 1952

342 U.S. 437

Syllabus

A foreign corporation, owning gold and silver mines in the Philippine Islands, temporarily
carried on in Ohio (during the Japanese occupation of the Philippines) a continuous and
systematic, but limited, part of its general business -- consisting of directors' meetings,
business correspondence, banking, stock transfers, payment of salaries, purchasing of
machinery, etc. While engaged in doing such business in Ohio, its president was served
with summons in an action in personam against the corporation filed in an Ohio state
court by a nonresident of Ohio. The cause of action did not arise in Ohio, and did not
relate to the corporation's activities there. A judgment sustaining a motion to quash the
service was affirmed by the State Supreme Court.

Held:

1. The Federal Constitution does not compel Ohio to open its courts to such a case --
even though Ohio permits a complainant to maintain a proceeding in personam in its
courts against a properly served nonresident natural person to enforce a cause of action
which does not arise out of anything done within the State. Pp. 342 U. S. 440-441.

2. The Due Process Clause of the Fourteenth Amendment also does not prohibit Ohio
from granting such relief against a foreign corporation. Old Wayne Life Assn. v.
McDonough, 204 U. S. 8, and Simon v. Southern R. Co., 236 U. S. 115, distinguished.
Pp. 342 U. S. 441-447.

3. As a matter of federal due process, the business done by the corporation in Ohio was
sufficiently substantial and of such a nature as to permit Ohio to entertain the cause of
action against it, though the cause of action arose from activities entirely distinct from its
activities in Ohio. Pp. 342 U. S. 447-449.

4. It not clearly appearing, under the Ohio practice as to the effect of the syllabus,
whether the Supreme Court of Ohio rested its decision on Ohio law or on the Fourteenth
Amendment, the cause is remanded to that court for further proceedings in the light of
the opinion of this Court. Pp. 342 U. S. 441-449.155 Ohio St. 116, 98 N.E.2d 33,
vacated and remanded.

Page 342 U. S. 438

In two actions in an Ohio state court, the trial court sustained a motion to quash the
service on the respondent foreign corporation. The Court of Appeals of Ohio affirmed,
88 Ohio App. 118, 95 N.E.2d 5, as did the State Supreme Court, 155 Ohio St. 116, 98
N.E.2d 33. This Court granted certiorari. 342 U.S. 808.Judgment vacated and cause
remanded, p. 342 U. S. 449.

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Perkins v. Benguet Consol. Mining Co. - 342 U.S. 437, 72 S. Ct. 413 (1952)

RULE:

The amount and kind of activities which must be carried on by the foreign corporation in
the state of the forum so as to make it reasonable and just to subject the corporation to
the jurisdiction of that state are to be determined in each case. The corporate activities
of a foreign corporation which, under state statute, make it necessary for it to secure a
license and to designate a statutory agent upon whom process may be served provide a
helpful but not a conclusive test. For example, the state of the forum may by statute
require a foreign mining corporation to secure a license in order lawfully to carry on
there such functional intrastate operations as those of mining or refining ore. On the
other hand, if the same corporation carries on, in that state, other continuous and
systematic corporate activities as it did here -- consisting of directors' meetings,
business correspondence, banking, stock transfers, payment of salaries, purchasing of
machinery, etc. -- those activities are enough to make it fair and reasonable to subject
that corporation to proceedings in personam in that state, at least insofar as the
proceedings in personam seek to enforce causes of action relating to those very
activities or to other activities of the corporation within the state.

FACTS:

A nonresident of Ohio filed suit against several respondents, including an incorporated

foreign mining company. The mining company had been carrying on a limited but
continuous and systematic part of its general business in the state. The foreign
company filed a motion to quash on the ground that the petitioner's cause of action did
not arise in Ohio and did not relate to the company's activities there. The Supreme
Court of Ohio sustained the foreign company's motion to quash.

ISSUE:

Can the Due Process Clause precluded Ohio from subjecting a foreign corporation to
the jurisdiction of its courts in an action in personam?

ANSWER:

No

CONCLUSION:

The U.S. Supreme Court held that the company's continuous and systematic in-state
activities, including directors' meetings, business correspondence, banking stock
transfers, and payment of salaries, were enough to make it fair and reasonable to
subject the company to proceedings in personam, at least insofar as the proceedings
sought to enforce causes of action related to those very activities or to other activities
within the state. As such, it did not violate federal due process for Ohio to either take or
decline jurisdiction of the company.

Pennhurst State School & Hospital

v. Halderman
Citation. 22 Ill.465 U.S. 89, 104 S. Ct. 900, 79 L. Ed. 2d 67 (1984)
Brief Fact Summary. The Respondents, Halderman and others (Respondents), filed
suit against the Petitioners, the Pennhust State School and Hospital and its officials
(Petitioners), charging conditions at the hospital violate class member’s rights. The
Petitioners argued before the Supreme Court of the United States (Supreme Court) that
the Eleventh Amendment of the United States Constitution (Constitution) prohibited the
District Court from ordering state official to conform their conduct to state law.

Synopsis of Rule of Law. A federal court’s grant of relief against state officials on the
basis of state law, whether, prospective or retroactive directly interferes with the
principles of federalism that underlie the Eleventh Amendment of the Constitution.

Facts. This case is before the Supreme Court for a second time to determine whether a
federal court can grant relief against state officials based on state law. The case
concerns the condition of care at Petitioners’ institution for the mentally retarded. The
Respondents’ amended complaint charged that the Petitioners violated class member’s
rights under (i) the Eighth and Fourteenth Amendments of the Constitution, (ii)
Section:504 of the Rehabilitation Act of 1973, (iii) the Developmentally Disabled
Assistance and Bill of Rights Act and (iv) the Pennsylvania Mental Health and Mental
Retardation Act of 1966. The Court of Appeals for the Third Circuit decided that the
Respondents had a right to rehabilitation in the least restrictive environment, based
solely on the bill of rights provision in the Developmentally Disabled Assistance and Bill
of Rights Act. The Supreme Court of the United States (Supreme Court) reversed the
judgment of the Court of Appeals finding that the Developmentally Dis
abled Assistance and Bill of Rights Act did not create any substantive rights and
remanded the case back to the Court of Appeals to determine if the remedial order
could be supported by any of the Respondents’ other arguments. The Court of Appeals
concluded that state law supported its prior judgment and also rejected the Petitioners’
argument that the Eleventh Amendment barred the federal court from considering the
pendent state law claim. The case goes before the Supreme Court to consider the
Petitioners’ position.

Issue. Whether a federal court has jurisdiction to award injunctive relief against state
officials on the basis of state law?

Held. Federal Courts lack jurisdiction to enjoin Petitioners’ actions on the basis of state
law. Reversed and remanded.

Dissent. The majority decision goes against established precedence by the Supreme
Court, stating a federal court can award injunctive relief on the basis of state law. This
new pronouncement will require federal courts to decide federal constitutional questions
despite the availability of state-law grounds for decision.

Discussion. The Eleventh Amendment of the Constitution prohibits a state from being
sued in federal courts by her own citizens, as well as by citizens of another state. The
Eleventh Amendment bars a suit against state officials when the state is a real,
substantial party in interest. An exception to the rule against suing state officials is when
the suit is challenging the constitutionality of state official’s actions. When bringing suit
in a federal court for a state official’s actions based on violation of federal law, a court
can impose an injunction that governs the official’s future conduct, but may not award
retroactive monetary relief. It is not the jurisdiction of federal courts to award relief
against a state official based on state law.

SAUDIA VS. CA
MARCH 28, 2013 ~ VBDIAZ

SAUDI ARABIAN AIRLINES (SAUDIA) vs. COURT OF APPEALS,

MILAGROS P. MORADA and HON. RODOLFO A. ORTIZ, in his capacity as
Presiding Judge of Branch 89, RTC of Quezon City
G.R. No. 122191 October 8, 1998
FACTS: Petitioner SAUDIA hired private respondent MORADA as a flight attendant
in 1988, based in Jeddah. On 1990, while on a lay-over in Jakarta, Indonesia, she went
to party with 2 male attendants, and on the following morning in their hotel, one of the
male attendants attempted to rape her. She was rescued by hotel attendants who heard
her cry for help. The Indonesian police arrested the 2.

MORADA returned to Jeddah, but was asked by the company to go back to Jakarta
and help arrange the release of the 2 male attendants. MORADA did not cooperate
when she got to Jakarta.

What followed was a series of interrogations from the Saudi Courts which she did not
understand as this was in their language. In 1993, she was surprised, upon being
ordered by SAUDIA to go to the Saudi court, that she was being convicted 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, sentencing her to five months imprisonment and to 286 lashes. Only then
did she realize that the Saudi court had tried her, together with the 2, for what
happened in Jakarta.

SAUDIA denied her the assistance she requested, But because she was wrongfully
convicted, Prince of Makkah dismissed the case against her and allowed her to leave
Saudi Arabia. Shortly before her return to Manila, she was terminated from the
service by SAUDIA, without her being informed of the cause.

On November 23, 1993, Morada filed a Complaint for damages against SAUDIA, and
Khaled Al-Balawi (“Al-Balawi”), its country manager.
SAUDIA ALLEGES: Private respondent’s claim for alleged abuse of rights occurred
in the Kingdom of Saudi Arabia. It alleges that the 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 ALLEGES: Since her Amended Complaint is based on Articles 19 and 21

of the Civil Code, then the instant case is properly a matter of domestic law.

ISSUE: WON the Philippine courts have jurisdiction to try the case
HELD: YES.
On the presence of a “Foreign Element” in the 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. 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.

COURT disagrees with MORADA that his is purely a domestic case. However, the
court finds that the RTC of Quezon City possesses jurisdiction over the subject matter
of the suit. Its authority to try and hear the case is provided for under Section 1 of
Republic Act No. 7691, to wit:

BP129 Sec. 19. Jurisdiction in Civil Cases. — Regional Trial Courts shall exercise
exclusive jurisdiction:
xxx xxx xxx
(8) In all other cases in which demand, exclusive of interest, damages of whatever
kind, attorney`y’s fees, litigation expenses, and cots or the value of the property in
controversy exceeds One hundred thousand pesos (P100,000.00) or, in such other
cases in Metro Manila, where the demand, exclusive of the above-mentioned items
exceeds Two hundred Thousand pesos (P200,000.00). (Emphasis ours)
xxx xxx xxx
Section 2 (b), Rule 4 of the Revised Rules of Court — the venue, Quezon City, is
appropriate:
Sec. 2 Venue in Courts of First Instance. — [Now Regional Trial Court]
(a) xxx xxx xxx
(b) Personal actions. — All other actions may be commenced and tried where the
defendant or any of the defendants resides or may be found, or where the plaintiff or
any of the plaintiff resides, at the election of the plaintiff.

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. The choice of forum of the
plaintiff (now private respondent) should be upheld.

The trial court also acquired jurisdiction over the parties. MORADA through her act
of filing, and SAUDIA by praying for the dismissal of the Amended Complaint on
grounds other than lack of jurisdiction.

As to the choice of applicable law, we note that choice-of-law problems seek to

answer two important questions:
(1) What legal system should control a given situation where some of the significant
facts occurred in two or more states; and
(2) to what extent should the chosen legal system regulate the situation.

Considering that the complaint in the court a quo is one involving torts, the
“connecting factor” or “point of contact” could be the place or places where the
tortious conduct or lex loci actus occurred. And applying the torts principle in a
conflicts case, we find that the Philippines could be said as a situs of the tort (the place
where the alleged tortious conduct took place). This is because it is in the Philippines
where petitioner allegedly deceived private respondent, a Filipina residing and
working here. According to her, she had honestly believed that petitioner would, in
the exercise of its rights and in the performance of its duties, “act with justice, give
her due and observe honesty and good faith.” Instead, petitioner failed to protect her,
she claimed. That certain acts or parts of the injury allegedly occurred in another
country is of no moment. For in our view what is important here is the place where the
over-all harm or the totality of the alleged injury to the person, reputation, social
standing and human rights of complainant, had lodged, according to the plaintiff
below (herein private respondent). All told, it is not without basis to identify the
Philippines as the situs of the alleged tort.

In applying “State of the most significant relationship” rule, to determine the State
which has the most significant relationship, the following contacts are to be 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, and (d) the place where the
relationship, if any, between the parties is centered.

William Gemperle v. Helen Schenker (1967)

Paul Schenke, a Swiss citizen, through his wife and attorney-in-fact Helen, filed a
complaint against Gemperle. Subsequently, Gemperle filed an action for damages
against the Schenke spouses for publication of allegations that damaged his reputation.
The CFI of Rizal dismissed the case for lack of jurisdiction over Paul and for want of
cause of action against Helen. The SC reversed, holding that the court had acquired
jurisdiction over Paul through the service of summons addressed to him and served
upon Helen.

Doctrine: Helen had authority to sue, and had actually sued on behalf of her husband,
so she was empowered to represent her husband in suits filed against him, particularly
in a case which arose from the action she brought on her husband’s behalf.

PERKINS VS. ROXAS

MARCH 28, 2013 ~ VBDIAZ

IDONAH PERKINS vs. ROXAS ET AL.

GRN 47517, June 27, 1941
FACTS:
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 consisting of
dividends which have been declared and made payable on shares of stock registered in
his name, payment of which was being withheld by the company, and for the
recognition of his right to the control and disposal of said shares to the exclusion of all
others. The company alleged, by way of defense that the withholding of plaintiff’s
right to the disposal and control of the shares was due to certain demands made with
respect to said shares by the petitioner Idonah Perkins, and by one Engelhard.
Eugene Perkins included in his modified complaint as parties defendants petitioner,
Idonah Perkins, and Engelhard. Eugene Perkins prayed that petitioner Idonah Perkins
and H. Engelhard be adjudged without interest in the shares of stock in question and
excluded from any claim they assert thereon. Summons by publication were served
upon the nonresident defendants Idonah Perkins and Engelhard. Engelhard filed his
answer. Petitioner filed her answer with a crosscomplaint in which she sets up a
judgment allegedly obtained by her against respondent Eugene Perkins, from the SC
of the State of New York, wherein it is declared that she is the sole legal owner and
entitled to the possession and control of the shares of stock in question with all the
cash dividends declared thereon by the Benguet Consolidated Mining Company.

Idonah Perkins filed a demurrer thereto on the ground that “the court has no
jurisdiction of the subject of the action,” because the alleged judgment of the SC of
the State of New York is res judicata. Petitioner’s demurrer was overruled, thus this
petition.

ISSUE:
WON in view of the alleged judgment entered in favor of the petitioner by the SC of
New York and which is claimed by her to be res judicata on all questions raised by the
respondent, Eugene Perkins, the local court has jurisdiction over the subject matter of
the action.
RULING:
By jurisdiction over the subject matter is meant the nature of the cause of action and
of the relief sought, and this is conferred by the sovereign authority which organizes
the court, and is to be sought for in general nature of its powers, or in authority
specially conferred. In the present case, the amended complaint filed by the
respondent, Eugene Perkins alleged calls for the adjudication of title to certain shares
of stock of the Benguet Consolidated Mining Company and the granting of
affirmative reliefs, which fall within the general jurisdiction of the CFI- Manila.
Similarly CFI- Manila is empowered to adjudicate the several demands contained in
petitioner’s crosscomplaint.
Idonah Perkins in her crosscomplaint brought suit against Eugene Perkins 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. 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 the general jurisdiction of the CFI- Manila, to adjudicate, settle
and determine.

The petitioner expresses the fear that the respondent judge may render judgment
“annulling the final, subsisting, valid judgment rendered and entered in this
petitioner’s favor by the courts of the State of New York, which decision is res
judicata on all the questions constituting the subject matter of civil case” and argues
on the assumption that the respondent judge is without 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 New York judgment set up by the petitioner in
her cross-complaint is a question that goes to the merits of the controversy and relates
to the rights of the parties as between each other, and not to the jurisdiction or power
of the court. The test of jurisdiction is whether or not the tribunal has power to enter
upon the inquiry, not whether its conclusion in the course of it is right or wrong. If its
decision is erroneous, its judgment can be reversed on appeal; but its determination of
the question, which the petitioner here anticipates and seeks to prevent, is the exercise
by that court and the rightful exercise of its jurisdiction.

Petition denied.
As already discussed, there is basis for the claim that over-all injury occurred and
lodged in the Philippines. There is likewise no question that private respondent is a
resident Filipina national, working with petitioner, a resident foreign corporation
engaged here in the business of international air carriage. Thus, the “relationship”
between the parties was centered here, although it should be stressed that this suit is
not based on mere labor law violations. From the record, the claim that the Philippines
has the most significant contact with the matter in this dispute, raised by private
respondent as plaintiff below against defendant (herein petitioner), in our view, has
been properly established.

NOTE:
These “test factors” or “points of contact” or “connecting factors” could be any of the
following:

(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.