CONFLICT OF LAWS CASES

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.

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.

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.

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.

CADALIN ET AL VS. POEA ET AL

MARCH 28, 2013 ~ VBDIAZ

BIENVENIDO M. CADALIN, ROLANDO M. AMUL, DONATO B. EVANGELISTA, and the rest of 1,767
NAMED-COMPLAINANTS, thru and by their Attorney-in-fact, Atty. GERARDO A. DEL MUNDOvs.
PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION’S ADMINISTRATOR, NLRC, BROWN & ROOT
INTERNATIONAL, INC. AND/OR ASIA INTERNATIONAL BUILDERS CORPORATION

GRN 104776, December 5,1994.

FACTS:

This is a consolidation of 3 cases of SPECIAL CIVIL ACTIONS in the Supreme Court for Certiorari.

On June 6, 1984, Cadalin, Amul and Evangelista, in their own behalf and on behalf of 728 other OCWs
instituted a class suit by filing an “Amended Complaint” with the POEA for money claims arising from
their recruitment by ASIA INTERNATIONAL BUILDERS CORPORATION (AIBC) and employment by BROWN
& ROOT INTERNATIONAL, INC (BRI) which is a foreign corporation with headquarters in Houston, Texas,
and is engaged in construction; while AIBC is a domestic corporation licensed as a service contractor to
recruit, mobilize and deploy Filipino workers for overseas employment on behalf of its foreign principals.

The amended complaint sought the payment of the unexpired portion of the employment contracts,
which was terminated prematurely, and secondarily, the payment of the interest of the earnings of the
Travel and Reserved Fund; interest on all the unpaid benefits; area wage and salary differential pay;
fringe benefits; reimbursement of SSS and premium not remitted to the SSS; refund of withholding tax
not remitted to the BIR; penalties for committing prohibited practices; as well as the suspension of the
license of AIBC and the accreditation of BRII

On October 2, 1984, the POEA Administrator denied the “Motion to Strike Out of the Records” filed by
AIBC but required the claimants to correct the deficiencies in the complaint pointed out.

AIB and BRII kept on filing Motion for Extension of Time to file their answer. The POEA kept on granting
such motions.

On November 14, 1984, claimants filed an opposition to the motions for extension of time and asked
that AIBC and BRII declared in default for failure to file their answers.

On December 27, 1984, the POEA Administrator issued an order directing AIBC and BRII to file their
answers within ten days from receipt of the order.

(at madami pang motions ang na-file, new complainants joined the case, ang daming inavail na remedies
ng both parties)

On June 19, 1987, AIBC finally submitted its answer to the complaint. At the same hearing, the parties
were given a period of 15 days from said date within which to submit their respective position papers.
On February 24, 1988, AIBC and BRII submitted position paper. On October 27, 1988, AIBC and BRII filed
a “Consolidated Reply,” POEA Adminitartor rendered his decision which awarded the amount of $824,
652.44 in favor of only 324 complainants. Claimants submitted their “Appeal Memorandum For Partial
Appeal” from the decision of the POEA. AIBC also filed its MR and/or appeal in addition to the “Notice of
Appeal” filed earlier.

NLRC promulgated its Resolution, modifying the decision of the POEA. The resolution removed some of
the benefits awarded in favor of the claimants. NLRC denied all the MRs. Hence, these petitions filed by
the claimants and by AlBC and BRII.

The case rooted from the Labor Law enacted by Bahrain where most of the complainants were
deployed. His Majesty Ise Bin Selman Al Kaifa, Amir of Bahrain, issued his Amiri Decree No. 23 on June
16, 1176, otherwise known re the Labour Law for the Private Sector. Some of the provision of Amiri
Decree No. 23 that are relevant to the claims of the complainants-appellants are as follows:
“Art. 79: x x x A worker shall receive payment for each extra hour equivalent to his wage entitlement
increased by a minimum of twenty-rive per centurn thereof for hours worked during the day; and by a
minimum off fifty per centurn thereof for hours worked during the night which shall be deemed to being
from seven 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.)

3. Whether or not the instant cases qualify as; a class suit (siningit ko nalang)

(the rest of the issues in the full text of the case refer to Labor Law)

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”

In this case, the claim for pay differentials is primarily anchored on the written contracts between the
litigants, the ten-year prescriptive period provided by Art. 1144(l) of the New Civil Code should govern.

3. NO. A class suit is proper where the subject matter of the controversy is 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 are for benefits granted under the Bahrain law many of the claimants worked
outside Bahrain. Some of the claimants were deployed in Indonesia under different terms and condition
of employment.

Inasmuch as the First requirement of a class suit is not present (common or general interest based on
the Amiri Decree of the State of Bahrain), it is only logical that only those who worked in Bahrain shall be
entitled to rile their claims in a class suit.

While there are common defendants (AIBC and BRII) and the nature of the claims is the same (for
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 claims of the other
employees of defendants. A claimant has no concern in protecting the interests of the other claimants
as shown by the fact, that hundreds of them have abandoned their co-claimants and have entered into
separate compromise settlements of their respective claims. The claimants who worked in Bahrain can
not be allowed to sue in a class suit in a judicial proceeding.

WHEREFORE, all the three petitioners are DISMISSED.