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

G.R. No. 102223

August 22, 1996

FACTS:
Petitioners COMMUNICATION MATERIALS AND DESIGN, INC.,
(CMDI) and ASPAC MULTI-TRADE INC., (ASPAC) are both domestic
corporations.. Private Respondents ITEC, INC. and/or ITEC,
INTERNATIONAL, INC. (ITEC) are corporations duly organized and existing
under the laws of the State of Alabama, USA. There is no dispute that ITEC is
a foreign corporation not licensed to do business in the Philippines.
ITEC entered into a contract with ASPAC referred to as “Representative
Agreement”. Pursuant to the contract, ITEC engaged ASPAC as its “exclusive
representative” in the Philippines for the sale of ITEC’s products, in
consideration of which, ASPAC was paid a stipulated commission. Through a
“License Agreement” entered into by the same parties later on, ASPAC was
able to incorporate and use the name “ITEC” in its own name. Thus , ASPAC
Multi-Trade, Inc. became legally and publicly known as ASPAC-ITEC
(Philippines).
One year into the second term of the parties’ Representative Agreement, ITEC
decided to terminate the same, because petitioner ASPAC allegedly violated its
contractual commitment as stipulated in their agreements. ITEC charges the
petitioners and another Philippine Corporation, DIGITAL BASE
COMMUNICATIONS, INC. (DIGITAL), the President of which is likewise
petitioner Aguirre, of using knowledge and information of ITEC’s products
specifications to develop their own line of equipment and product support,
which are similar, if not identical to ITEC’s own, and offering them to ITEC’s
former customer.

The complaint was filed with the RTC-Makati by ITEC, INC. Defendants
filed a MTD the complaint on the following grounds: (1) That plaintiff has no
legal capacity to sue as it is a foreign corporation doing business in the
Philippines without the required BOI authority and SEC license, and (2) that
plaintiff is simply engaged in forum shopping which justifies the application
against it of the principle of “forum non conveniens”. The MTD was denied.

Petitioners elevated the case to the respondent CA on a Petition for

Certiorari and Prohibition under Rule 65 of the Revised ROC. It was dismissed
as well. MR denied, hence this Petition for Review on Certiorari under Rule
45.
ISSUE:

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

HELD:
petition dismissed.
1. YES; We are persuaded to conclude that ITEC had been “engaged in” or
“doing business” in the Philippines for some time now. This is the inevitable
result after a scrutiny of the different contracts and agreements entered into
by ITEC with its various business contacts in the country. Its arrangements,
with these entities indicate convincingly that ITEC is actively engaging in
business in the country.

A foreign corporation doing business in the Philippines may sue in Philippine

Courts although not authorized to do business here against a Philippine citizen
or entity who had contracted with and benefited by said corporation. To put it
in another way, a party is estopped to challenge the personality of a
corporation after having acknowledged the same by entering into a contract
with it. And the doctrine of estoppel to deny corporate existence applies to a
foreign as well as to domestic corporations. One who has dealt with a
corporation of foreign origin as a corporate entity is estopped to deny its
corporate existence and capacity.

In Antam Consolidated Inc. vs. CA et al. we expressed our chagrin over this
commonly used scheme of defaulting local companies which are being sued by
unlicensed foreign companies not engaged in business in the Philippines to
invoke the lack of capacity to sue of such foreign companies. Obviously, the
same ploy is resorted to by ASPAC to prevent the injunctive action filed by
ITEC to enjoin petitioner from using knowledge possibly acquired in violation
of fiduciary arrangements between the parties.

2. YES; Petitioner’s insistence on the dismissal of this action due to the

application, or non application, of the private international law rule of forum
non conveniens defies well-settled rules of fair play. According to petitioner,
the Philippine Court has no venue to apply its discretion whether to give
cognizance or not to the present action, because it has not acquired
jurisdiction over the person of the plaintiff in the case, the latter allegedly
having no personality to sue before Philippine Courts. This argument is
misplaced because the court has already acquired jurisdiction over the
plaintiff in the suit, by virtue of his filing the original complaint. And as we
have already observed, petitioner is not at liberty to question plaintiff’s
standing to sue, having already acceded to the same by virtue of its entry into
the Representative Agreement referred to earlier.

Thus, having acquired jurisdiction, it is now for the Philippine Court, based on
the facts of the case, whether to give due course to the suit or dismiss it, on the
principle of forum non convenience. Hence, the Philippine Court may refuse
to assume jurisdiction in spite of its having acquired jurisdiction. Conversely,
the court may assume jurisdiction over the case if it chooses to do so;
provided, that the following requisites are met:

1) That the Philippine Court is one to which the parties may conveniently
resort to;
2) That the Philippine Court is in a position to make an intelligent
decision as to the law and the facts; and,
3) That the Philippine Court has or is likely to have power to enforce its
decision.
The aforesaid requirements having been met, and in view of the court’s
disposition to give due course to the questioned action, the matter of the
present forum not being the “most convenient” as a ground for the suit’s
dismissal, deserves scant consideration.

Raytheon international vs rouzie gr 162894

FACTS

Brand Marine Services, Inc. (BMSI), a corporation duly organized & existing under the laws of Connecticut,
&Stockton Rouzie, Jr., an American citizen, entered into a contract BMSI hired Rouzie as its representative to
negotiate the sale of services in several government projects in thePhilippines for an agreed remuneration of 10%
of the gross receipts. Rouzie secured a service contract w/ the Rep. of Phil. on behalf of BMSI for the dredging of
rivers affected by the Mt.Pinatubo eruption & mudflows. Rouzie filed before the NLRC a suit against BMSI and Rust
International (Rust) for alleged nonpayment of commissions, illegal termination, & breach of employment
contract. The Labor Arbiter ordered BMSI & Rust to pay Rouzie’s money claims.

Upon appeal, the NLRC reversed & dismissed Rouzie’s complaint on the ground of lack of jurisdiction.
Rouzie filed an action for damages before the RTC of La Union (where he was a resident) against Raytheon
International. He reiterated that he was not paid the commissions due him from the Pinatubo dredging project w/c
hesecured on behalf of BMSI. The complaint also averred that BMSI, RUST and Raytheon had combined &
functioned as 1 company.
RAYTHEON SOUGHT THE DISMISSAL OF THE COMPLAINT ON THE GROUNDS OF FAILURE TO STATE ACAUSE OF
ACTION & FORUM NON CONVENIENS & PRAYED FOR DAMAGES BY WAY OF COMPULSORY
COUNTERCLAIM. THE RTC DENIED RAYTHEON’S MOTION. THE CA AFFIRMED.

Raytheon’s contention: The written contract between Rouzie & BMSI included a valid choice of law clause, that is,
that the contract shall be governed by the laws of the State of Connecticut. It also mentions the presence of
foreign elements in the dispute, namely that the parties & witnesses involved are American corporations & citizens
& the evidence to be presented is located outside the Philippines, that renders our local courts inconvenient
forums. The foreign elements of the dispute necessitate the immediate application of the doctrine of forum non
conveniens.

ISSUES(a) W/N the RTC had jurisdiction.(b) W/N the complaint should be dismissed on the ground of forum non
conveniens.

RULING

(a) YES.

On the matter of jurisdiction over a conflicts-of-laws problem where the case is filed in a Philippine court and
where the court has jurisdiction over the subject matter, the parties and the res, it may or can proceed to try the
case even if the rules of conflict-of-laws or the convenience of the parties point to a foreign forum. This is an
exercise of sovereign prerogative of the country where the case is filed.

Jurisdiction over the nature and subject matter of an action is conferred by the Constitution and the law & by the
material allegations in the complaint, irrespective of w/n the plaintiff is entitled to recover all or some of the claims
or reliefs sought therein. The case file was an action for damages arising from an alleged breach of contract.
Undoubtedly, the nature of the action and the amount of damages prayed are w/in the jurisdiction of the RTC.

 As regards jurisdiction over the parties, the RTC acquired jurisdiction over Rouzi upon the filing of the complaint.
On the other hand, jurisdiction over the person of Raytheon was acquired by its voluntary appearance in court.

That THE SUBJECT CONTRACT INCLUDED A STIPULATION THAT THE SAME SHALL BE GOVERNED BYTHE LAWS OF
THE STATE OF CONNECTICUT DOES NOT SUGGEST THAT THE PHILIPPINE COURTS,
OR ANY OTHER FOREIGN TRIBUNAL FOR THAT MATTER, ARE PRECLUDED FROM HEARING THE CIVIL ACTION.

JURISDICTION & CHOICE OF LAW ARE 2 DISTINCT CONCEPTS. Jurisdiction considers whether it is fair to cause a
defendant to travel to this state; choice of law asks the further question whether the application of a substantive
law which will determine the merits of the case is fair to both parties. The choice of law stipulation will be come
relevant only when the substantive issues of the instant case develop, that is, after hearing on the merits proceeds
before the trial court.

(b) NO.

UNDER THE DOCTRINE OF FORUM NON CONVENIENS, A COURT, IN CONFLICTS-OF-LAWS CASES, MAY
REFUSE IMPOSITIONS ON ITS JURISDICTION WHERE IT IS NOT THE MOST “CONVENIENT” OR
 AVAILABLE FORUM AND THE PARTIES ARE NOT PRECLUDED FROM SEEKING REMEDIES ELSEWHERE.
Raytheon’s averments of the foreign elements are not sufficient to oust the RTC of its jurisdiction over the case
and the parties involved.
Moreover, the propriety of dismissing a case based on the principle of forum non conveniens requires a factual
determination; hence, it is more properly considered as a matter of defense. While it is w/c the discretion of the
trial court to abstain from assuming jurisdiction on this ground, it should do so only after vital facts are established,
to determine whether special circumstances require the court’s desistance.

NAVIDA VS. DIZON

FACTS:
 2 petitions, G.R. 125078 & 125598, assailed the perceived lack of
jurisdiction of RTC over the matter
 Proceedings before the texas courts:
 Beginning 1993, a number of personal injury suits were filed in
different texas state courts by citizens of 12 foreign countries,
including the Philippines;
 Thousands of plaintiffs sought damages for injuries they allegedly
sustained from their exposure to a chemical used to kill
nematodes while working on farms in 23 foreign countries;
 Respondents want the case be dismissed under the doctrine of
forum non conveniens
 The federal district court granted the motion to dismiss subject to
certain conditions;
 Proceedings in the RTC of General Santos City
 336 plaintiffs from GenSan filed a Joint Complaint in the RTC of
GenSan.
 They prayed for the payment of damages in view of the illnesses
and injuries suffered from DBCP, claiming that they were
exposed to the said chemical even though the defendants knew
it was harmful;
 Defendant filed their motion for bill of particulars
 The RTC dismissed the complaints on the following grounds:
  The activity took outside the Philippines territory, hence,
outside Philippine jurisdiction;
 The tort in the complaint, which is “product liability tort” is not
the tor category within the purview of Philippine Law
 That Petitioners coerced into submitting their case in the
Philippines
 The voluntary appearance of defendants has little
significance;
 Petioners violated the rules on forum shopping and litis
pendencia
 The case is barred by “litis pendencia” – SINCE THE CASE
IS PENDING IN THE US COURTS, THE PRESENT
COMPLAINT MUST BE DISMISSED
 The petitioners filed a Petition for Review
 Proceedings in the RTC of Davao City
 155 plaintiffs from Davao filed a complaint in the RTC of
Davao, similar to the complaint of Navida etal (GenSan)
 However, the RTC likewise junked the case for the following
reasons:
 That Petitioners would have this court dismiss the case to
pave the way for their getting an affirmance by the
supreme court
 It shares the opinion of legal experts, to wit:
 The Philippines should be an inconvenient forum to
file this kind of damage suit against foreign
companies since the causes of action alleged in the
petition do not exist under Philippine laws (Former
Justice Secretary Demetria);
 While a class suit is allowed in the Philippines, the
device has been employed strictly. Mass sterility will
not qualify as a class suit injury within the
contemplation of Philippine statute (Retired Supreme
Court Justice Sarmiento);
  Absence of doctrine in the Philippines regarding
product liability
 Petitioners (Davao) contends that the RTC has
jurisdiction over the case since Articles 2176 and 2187 of
the Civil Code are broad enough to cover the acts
complained of; and that the opinions of the legal experts
are bereft of basis;
 Motion to withdraw was filed by Respondents asserting
that the Petition for review is moot and academic since
they already entered into an amicable settlement with
petitioners

ISSUE/S:
1. Whether or not the Court is correct in dismissing the petition due to
lack of jurisdiction?
2. Whether or not the trial court has jurisdiction over the matter?
1. That the acts complained of occurred within the Philippines;
2. That Article 2176 of the Civil Code is broad enough to cover the
act;
3. That assumption by the US District Court did not divest
jurisdiction of the Philippine courts; and,
4. That the compromise agreement does not justifiably prejudice
remaining respondents.

RULING/S:

ISSUE ON JURISDICTION
1. The court erred in dismissing the case on the ground of jurisdiction.
1. The jurisdiction of court cannot be made to depend upon the
defenses set by defendants. What determines jurisdiction of the
court is the nature of action pleaded as appearing from the
allegations in the complaint.
2. None of the parties actually move for the case based on the RTC
jurisdiction but more on the prayer for damages.
3. The trial court has clearly jurisdiction over the matter.
1. THE RULE IS SETTLED THAT JURISDICTION OVER THE
SUBJECT MATTER OF A CASE IS CONFERRED BY LAW AND
IS DETERMINED BY THE ALLEGATIONS IN THE COMPLAINT
AND THE CHARACTER OF THE RELIEF SOUGHT. Once
vested by law, on a particular court or body, the jurisdiction over
the subject matter of the action cannot be dislodged by anybody
other that the legislature thru enactment of a law.
4. On whether the act occurred in the Philippines, the Court held YES.
Thus, civil code article 2176 which provides that “whoever by act or
omission causes damage to another, there being fault or negligence,
is obliged to pay for the damage done..xxx” is applicable in the case
at bar and therefore, RTC obviously has jurisdiction over the matter.
1. Also, the case at bar is a personal case, not a criminal, hence,
lex situs theory is not necessarily applicable.
5. The facts clearly shows that the claim for damages is the cause of
action and that the RTC unmistakably has jurisdiction over the
matter.
6. Moreover, the RTC of GenSan and Davao validly acquired
jurisdiction over the persons of all the defendant companies.
1. In the case Meat Packing Corp. of the Philippines vs.
Sandiganbayan, the court held that “jurisdiction over the
person of the defendant in civil cases is acquired by his
voluntary appearance in court and his submission to its
authority or by service of summons..xxx…active
participation of a party in the proceedings is tantamount to
an invocation of court’s jurisdiction and willingness to abide
in the resolution of the case”.
2. Jurisdiction is different from “exercise of jurisdiction”. Jurisdiction
refers to the authority to decide a case, not the orders or the
decision rendered therein.
3. Where a court has jurisdiction over persons of the defendants
and the subject matter, the decision on all questions arising
therefrom is the exercise of jurisdiction.
Hasegawa vs Kitamura

FACTS:

Nippon, a Japanese consultancy firm entered into a one-year ICA contract

with Kitamura, a Japanese national permanently residing in the Philippines.
On February 2000, Kitamura was informed that Nippon is no longer renewing
his ICA and his services would only be utilized until March 31, 2000.
Aggrieved, Kitamura now filed an action for specific performance and
damages with the RTC of Lipa City. Nippon filed a motion to dismiss. The trial
and appellate court ruled in favor of Kitamura, hence this petition.

ISSUE:

Whether or not the RTC of Lipa City has jurisdiction for contracts executed by
and between two foreign nationals in foreign country wholly written in a foreign
language?

RULING:

Yes. In the judicial resolution of conflict problems, 3 consecutive phases are

involved: jurisdiction, choice of law, and recognition and enforcement of
judgments. Jurisdiction and choice of law are two different concepts.
Jurisdiction considers whether it is fair to cause a defendant to travel to this
state; choice of law asks the further question whether the application of a
substantive law which will determine the merits of the case is fair to both
parties. The power to exercise jurisdiction does not automatically give a state
a constitutional authority to apply forum law.
The only issue is the jurisdiction, hence, choice of law rules as raised by the
petitioner is inapplicable and not yet called for. The petitioner prematurely
invoked the said rules before pointing out any conflict between the laws of
Japan and the Philippines.

Continental Micronesia v. Basso

GR No. 178382-83
Labor Relations: Jurisdiction

Facts:

Petitioner Continental Micronesia is a foreign corporation organized and existing under the laws of and
domiciled in the United States of America. It is licensed to do business in the Philippines. Respondent, a
US citizen residing in the Philippines, accepted an offer to be a General Manager position by Mr. Braden,
Managing Director-Asia of Continental Airlines. On November 7, 1992, CMI took over the Philippine
operations of Continental, with respondent retaining his position as General Manager. Thereafter,
respondent received a letter from Mr. Schulz, who was then CMI’s Vice President of Marketing and Sales,
informing him that he has agreed to work in CMI as a consultant on an “as needed basis.” Respondent
wrote a counter-proposal that was rejected by CMI.

Respondent then filed a complaint for illegal dismissal against the petitioner corporation. Alleging the
presence of foreign elements, CMI filed a Motion to Dismiss on the ground of lack of jurisdiction over the
person of CMI and the subject matter of the controversy.

The Labor Arbiter agreed with CMI that the employment contract was executed in the US “since the letter-
offer was under the Texas letterhead and the acceptance of Complainant was returned there.” Thus,
applying the doctrine of lex loci celebrationis, US laws apply. Also, applying lex loci contractus, the Labor
Arbiter ruled that the parties did not intend to apply Philippine laws.

The NLRC ruled that the Labor Arbiter acquired jurisdiction over the case when CMI voluntarily submitted
to his office’s jurisdiction by presenting evidence, advancing arguments in support of the legality of its
acts, and praying for reliefs on the merits of the case.

The Court of Appeals ruled that the Labor Arbiter and the NLRC had jurisdiction over the subject matter of
the case and over the parties.

Issue:

Whether labor tribunals have jurisdiction over the case.

Held:

Yes. The Court ruled that the labor tribunals had jurisdiction over the parties and the subject matter of the
case. The employment contract of Basso was replete with references to US laws, and that it originated
from and was returned to the US, do not automatically preclude our labor tribunals from exercising
jurisdiction to hear and try this case.
On the other hand, jurisdiction over the person of CMI was acquired through the coercive process of
service of summons. CMI never denied that it was served with summons. CMI has, in fact, voluntarily
appeared and participated in the proceedings before the courts. Though a foreign corporation, CMI is
licensed to do business in the Philippines and has a local business address here. The purpose of the law
in requiring that foreign corporations doing business in the country be licensed to do so, is to subject the
foreign corporations to the jurisdiction of our courts.

Where the facts establish the existence of foreign elements, the case presents a conflicts-of-laws issue.
Under the doctrine of forum non conveniens, a Philippine court in a conflict-of-laws case may assume
jurisdiction if it chooses to do so, provided, that the following requisites are met: (1) that the Philippine
Court is one to which the parties may conveniently resort to; (2) that the Philippine Court is in a position to
make an intelligent decision as to the law and the facts; and (3) that the Philippine Court has or is likely to
have power to enforce its decision. All these requisites are present here.

UNITED AIRLINES, INC.,Petitioner vs.

COURT OF APPEALS, ANICETO FONTANILLA,
in his personal capacity and in behalf of his minor son
MYCHAL ANDREW FONTANILLA, Respondents.

FACTS:
Aniceto Fontanilla bought from United Airlines,through the Philippine Travel Bureau in Manila,
three “Visit the U.S.A.” tickets from himself, his wife and his minors on, Mychal, to visit
the cities of Washington DC, Chicago and Los Angeles.All flights had been confirmed
previously by United Airlines.
Having used the first coupon to DC and while at the Washington Dulles Airport, Anice to
changed their itinerary, paid the penalty for rewriting their tickets and was issued
tickets with corresponding boarding passes with the words: “Check-in-required.” They
were then set to leave but were denied boarding because the flight was
overbooked. The CA ruled that private respondents’ failure to comply with the check-in requirement
will not defeat his claim as the denied boarding rules were not complied with applying the laws of the USA,
relying on the Code of Federal Regulation Part on Oversales of  the USA

ISSUE: WON the CA is correct in applying the laws of USA.

HELD:  No.

According to the doctrine of “lex loci contractus”, the law of the place where a contract is made or entered
into governs with respect to its nature and validity, obligation and interpretation shall govern. This has been
said to be the rule even though the place where the contract was made is different from the place where it
is to be performed. Hence, the court should apply the law of the place where the airline ticket was issued,
where the passengers are residents and nationals of the forum and the ticket is issued in such State
by the defendant airline. Therefore, although, the contract of carriage was to be performed in the United
States, the tickets were purchased through petitioner’s agent in Manila. It is true that the tickets were
"rewritten" in D.C.,however, such fact did not change the nature of the original contract of carriage entered
Into by the parties in Manila.
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.

PAKISTAN INTERNATIONAL AIRLINES (PIA) CORPORATION vs

HON. BLAS F. OPLE, in his capacity as Minister of Labor; HON.
VICENTE LEOGARDO, JR., in his capacity as Deputy Minister;
ETHELYNNE B. FARRALES and MARIA MOONYEEN MAMASIG
G.R. No. 61594 September 28, 1990

FACTS: On 2 December 1978, petitioner Pakistan International Airlines

Corporation (PIA), a foreign corporation licensed to do business in the
Philippines, executed in Manila 2 separate contracts of employment, one with
private respondent Farrales and the other with private respondent Mamasig. 1
The contracts, which became effective on 9 January 1979, provided in
pertinent portion as follows:
5. DURATION OF EMPLOYMENT AND PENALTY
This agreement is for a period of 3 years, but can be extended by the mutual
consent of the parties.
xxx xxx xxx
6. TERMINATION
xxx xxx xxx
Notwithstanding anything to contrary as herein provided, PIA reserves the
right to terminate this agreement at any time by giving the EMPLOYEE notice
in writing in advance one month before the intended termination or in lieu
thereof, by paying the EMPLOYEE wages equivalent to one month’s salary.
xxx xxx xxx
10. APPLICABLE LAW:
This agreement shall be construed and governed under and by the laws of
Pakistan, and only the Courts of Karachi, Pakistan shall have the jurisdiction
to consider any matter arising out of or under this agreement.
Farrales & Mamasig (employees) were hired as flight attendants after
undergoing training. Base station was in Manila and flying assignments to
different parts of the Middle East and Europe.

roughly 1 year and 4 months prior to the expiration of the contracts of

employment, PIA through Mr. Oscar Benares, counsel for and official of the
local branch of PIA, sent separate letters, informing them that they will be
terminated effective September 1, 1980.
Farrales and Mamasig jointly instituted a complaint, for illegal dismissal and
non-payment of company benefits and bonuses, against PIA with the then
Ministry of Labor and Employment (MOLE).

PIA’s Contention: The PIA submitted its position paper, but no evidence, and
there claimed that both private respondents were habitual absentees; that
both were in the habit of bringing in from abroad sizeable quantities of
“personal effects”; and that PIA personnel at the Manila International Airport
had been discreetly warned by customs officials to advise private respondents
to discontinue that practice. PIA further claimed that the services of both
private respondents were terminated pursuant to the provisions of the
employment contract.

Favorable decision for the respondents. The Order stated that private
respondents had attained the status of regular employees after they had
rendered more than a year of continued service; that the stipulation limiting
the period of the employment contract to 3 years was null and void as violative
of the provisions of the Labor Code and its implementing rules and regulations
on regular and casual employment; and that the dismissal, having been
carried out without the requisite clearance from the MOLE, was illegal and
entitled private respondents to reinstatement with full backwages.
Decision sustained on appeal. Hence, this petition for certiorari

ISSUE: (Relative to the subject) Which law should govern over the case?
Which court has jurisdiction?
HELD: Philippine Law and Philippine courts
Petitioner PIA cannot take refuge in paragraph 10 of its employment
agreement which specifies, firstly, the law of Pakistan as the applicable law of
the agreement and, secondly, lays the venue for settlement of any dispute
arising out of or in connection with the agreement “only [in] courts of Karachi
Pakistan”.
We have already pointed out that the relationship is much affected with public
interest and that the otherwise applicable Philippine laws and regulations
cannot be rendered illusory by the parties agreeing upon some other law to
govern their relationship.
the contract was not only executed in the Philippines, it was also performed
here, at least partially; private respondents are Philippine citizens and
respondents, while petitioner, although a foreign corporation, is licensed to do
business (and actually doing business) and hence resident in the Philippines;
lastly, private respondents were based in the Philippines in between their
assigned flights to the Middle East and Europe. All the above contacts point to
the Philippine courts and administrative agencies as a proper forum for the
resolution of contractual disputes between the parties.
Under these circumstances, paragraph 10 of the employment agreement
cannot be given effect so as to oust Philippine agencies and courts of the
jurisdiction vested upon them by Philippine law. Finally, and in any event, the
petitioner PIA did not undertake to plead and prove the contents of Pakistan
law on the matter; it must therefore be presumed that the applicable
provisions of the law of Pakistan are the same as the applicable provisions of
Philippine law.
[DOCTRINE OF PROCESSUAL PRESUMPTION, eh?]
Petition denied.
_______
NOTES:
Another Issue: petitioner PIA invokes paragraphs 5 and 6 of its contract of
employment with private respondents Farrales and Mamasig, arguing that its
relationship with them was governed by the provisions of its contract rather
than by the general provisions of the Labor Code.
A contract freely entered into should, of course, be respected, as PIA argues,
since a contract is the law between the parties. The principle of party
autonomy in contracts is not, however, an absolute principle. The rule in
Article 1306, of our Civil Code is that the contracting parties may establish
such stipulations as they may deem convenient, “provided they are not
contrary to law, morals, good customs, public order or public policy.” Thus,
counter-balancing the principle of autonomy of contracting parties is the
equally general rule that provisions of applicable law, especially provisions
relating to matters affected with public policy, are deemed written into the
contract. Put a little differently, the governing principle is that parties may not
contract away applicable provisions of law especially peremptory provisions
dealing with matters heavily impressed with public interest. The law relating
to labor and employment is clearly such an area and parties are not at liberty
to insulate themselves and their relationships from the impact of labor laws
and regulations by simply contracting with each other. It is thus necessary to
appraise the contractual provisions invoked by petitioner PIA in terms of their
consistency with applicable Philippine law and regulations.

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 Renvoi Doctrine

1 Reply

What is the Renvoi Doctrine?

The Renvoi Doctrine is a judicial precept whereby the Conflict of Laws Rule in the place of the forum
refer a matter to the Conflict of Laws Rule in another, and the latter refers the matter back to the
forum (remission) or to a third state (transmission). Thus, owing to its french translation: “to send
back” or “to refer back unopened”.
It becomes relevant in cases where the individual involved is a national of one country and a
domiciliary of another; or with respect to property, the property is located in one country and the law
of another is being invoked relative to the issues concerning the property. So much so that where an
individual (a decedent) is a national and a domiciliary of one country (say, Texas U.S.), there can be
no Renvoi as to the issue concerning the validity of his disposition by virtue of the will here in the
Philippines since it is the law of the nationality which is to be applied and there was no instance of
the matter being referred back (Bellis vs. Bellis; Note that in the case, the Doctrine of Processual
Presumption was applied).
An example  where the Renvoi Doctrine was applied was in the case of Aznar vs. Garcia. The
Decedent was a national of California and a domiciliary of the Philippines. The acknowledged natural
child claimed her right to her legitime pursuant to Philippine law. This was opposed by the
decedent’s executor contending  that the will, not mentioning her legitimes, was valid pursuant to
Californian law. The Court in the Philippines ruled in favor of the child. The reason: while the
Philippine laws hold that it is the law of the country of nationality of the decedent which should
govern, where the law of the latter refers back the matter to the forum or domiciliary, there
is Renvoi. Thus the Philippine  Court will take cognizance of the issue and apply the law of the
Philippines. The law of the state of California provides for the applicBility of the law of the domicile,
by reason of which the Court validly ruled in favor of the acknowledged natural child.
SPOUSES ZALAMEA and LIANA ZALAMEA vs. CA and TRANSWORLD
AIRLINES, INC.
G.R. No. 104235 November 18, 1993
FACTS:
Petitioners-spouses Cesar Zalamea and Suthira Zalamea, and their daughter,
Liana purchased 3 airline tickets from the Manila agent of respondent
TransWorld Airlines, Inc. for a flight to New York to Los Angeles. The tickets
of petitioners-spouses were purchased at a discount of 75% while that of their
daughter was a full fare ticket. All three tickets represented confirmed
reservations.

On the appointed date, however, petitioners checked in but were placed on the
wait-list because the number of passengers who had checked in before them
had already taken all the seats available on the flight. Out of the 42 names on
the wait list, the first 22 names were eventually allowed to board the flight to
Los Angeles, including petitioner Cesar Zalamea. The two others were not able
to fly. Those holding full-fare tickets were given first priority among the wait-
listed passengers. Mr. Zalamea, who was holding the full-fare ticket of his
daughter, was allowed to board the plane; while his wife and daughter, who
presented the discounted tickets were denied boarding.

Even in the next TWA flight to Los Angeles Mrs. Zalamea and her daughter,
could not be accommodated because it was also fully booked. Thus, they were
constrained to book in another flight and purchased two tickets from
American Airlines. Upon their arrival in the Philippines, petitioners filed an
action for damages based on breach of contract of air carriage before the RTC-
Makati. The lower court ruled in favor of petitioners . CA held that moral
damages are recoverable in a damage suit predicated upon a breach of
contract of carriage only where there is fraud or bad faith. Since it is a matter
of record that overbooking of flights is a common and accepted practice of
airlines in the United States and is specifically allowed under the Code of
Federal Regulations by the Civil Aeronautics Board, no fraud nor bad faith
could be imputed on respondent TransWorld Airlines. Thus petitioners raised
the case on petition for review on certiorari.

ISSUE;
WON TWZ acted with bad faith and would entitle Zalameas to Moral and
Examplary damages.
RULING:
The U.S. law or regulation allegedly authorizing overbooking has never been
proved. Foreign laws do not prove themselves nor can the courts take judicial
notice of them. Like any other fact, they must be alleged and proved. Written
law may be evidenced by an official publication thereof or by a copy attested
by the officer having the legal custody of the record, or by his deputy, and
accompanied with a certificate that such officer has custody. The certificate
may be made by a secretary of an embassy or legation, consul general, consul,
vice-consul, or consular agent or by any officer in the foreign service of the
Philippines stationed in the foreign country in which the record is kept, and
authenticated by the seal of his office.
Respondent TWA relied solely on the statement of Ms. Gwendolyn Lather, its
customer service agent, in her deposition that the Code of Federal Regulations
of the Civil Aeronautics Board allows overbooking. No official publication of
said code was presented as evidence. Thus, respondent court’s finding that
overbooking is specifically allowed by the US Code of Federal Regulations has
no basis in fact.
Even if the claimed U.S. Code of Federal Regulations does exist, the same is
not applicable to the case at bar in accordance with the principle of lex loci
contractus which require that the law of the place where the airline ticket was
issued should be applied by the court where the passengers are residents and
nationals of the forum and the ticket is issued in such State by the defendant
airline. Since the tickets were sold and issued in the Philippines, the applicable
law in this case would be Philippine law.

Existing jurisprudence explicitly states that overbooking amounts to bad faith,

entitling the passengers concerned to an award of moral damages. In Alitalia
Airways v. Court of Appeals, where passengers with confirmed bookings were
refused carriage on the last minute, this Court held that when an airline issues
a ticket to a passenger confirmed on a particular flight, on a certain date, a
contract of carriage arises, and the passenger has every right to expect that he
would fly on that flight and on that date. If he does not, then the carrier opens
itself to a suit for breach of contract of carriage. Where an airline had
deliberately overbooked, it took the risk of having to deprive some passengers
of their seats in case all of them would show up for the check in. For the
indignity and inconvenience of being refused a confirmed seat on the last
minute, said passenger is entitled to an award of moral damages.

For a contract of carriage generates a relation attended with public duty — a

duty to provide public service and convenience to its passengers which must
be paramount to self-interest or enrichment.

Respondent TWA is still guilty of bad faith in not informing its passengers
beforehand that it could breach the contract of carriage even if they have
confirmed tickets if there was overbooking. Respondent TWA should have
incorporated stipulations on overbooking on the tickets issued or to properly
inform its passengers about these policies so that the latter would be prepared
for such eventuality or would have the choice to ride with another airline.

Respondent TWA was also guilty of not informing its passengers of its alleged
policy of giving less priority to discounted tickets. Neither did it present any
argument of substance to show that petitioners were duly apprised of the
overbooked condition of the flight or that there is a hierarchy of boarding
priorities in booking passengers. It is evident that petitioners had the right to
rely upon the assurance of respondent TWA, thru its agent in Manila, then in
New York, that their tickets represented confirmed seats without any
qualification. The failure of respondent TWA to so inform them when it could
easily have done so thereby enabling respondent to hold on to them as
passengers up to the last minute amounts to bad faith. Evidently, respondent
TWA placed its self-interest over the rights of petitioners under their contracts
of carriage. Such conscious disregard of petitioners’ rights makes respondent
TWA liable for moral damages. To deter breach of contracts by respondent
TWA in similar fashion in the future, we adjudge respondent TWA liable for
exemplary damages, as well.

In the case of Alitalia Airways v. Court of Appeals, this Court explicitly held
that a passenger is entitled to be reimbursed for the cost of the tickets he had
to buy for a flight to another airline. Thus, instead of simply being refunded
for the cost of the unused TWA tickets, petitioners should be awarded the
actual cost of their flight from New York to Los Angeles.
WHEREFORE, the petition is hereby GRANTED and the decision of the
respondent Court of Appeals is hereby MODIFIED

GRACE J. GARCIA, a.k.a. GRACE J. GARCIA-RECIO, petitioner, VS. RODERICK A.

RECIO,
respondent
October 2, 2001

FACTS:
The respondent, a Filipino was married to Editha Samson, an Australian citizen, in Rizal in
1987. They lived together as husband and wife in Australia. In 1989, the Australian family court
issued a decree of divorce supposedly dissolving the marriage. In 1992, respondent acquired
Australian citizenship. In 1994, he married Grace Garcia, a Filipina, herein petitioner, in
Cabanatuan City. In their application for marriage license, respondent was declared as “single”
and “Filipino”. Since October 1995, they lived separately; and in 1996 while in Autralia, their
conjugal assets were divided. In 1998, petitioner filed Complaint for Declaration of Nullity of
Marriage on the ground of bigamy, claiming that she learned of the respondent’s former
marriage only in November. On the other hand, respondent claims that he told petitioner of his
prior marriage in 1993, before they were married. Respondent also contended that his first
marriage was dissolved by a divorce decree obtained in Australia in 1989 and hence, he was
legally capacitated to marry petitioner in 1994. The trial court declared that the first marriage
was dissolved on the ground of the divorce issued in Australia as valid and recognized in the
Philippines. Hence, this petition was forwarded before the Supreme Court.

ISSUES:
1. Whether or not the divorce between respondent and Editha Samson was proven.
2. Whether or not respondent has legal capacity to marry Grace Garcia.

RULING:
The Philippine law does not provide for absolute divorce; hence, our courts cannot grant it. In
mixed marriages involving a Filipino and a foreigner, Article 26 of the Family Code allows the
former to contract a subsequent marriage in case the divorce is “validly obtained abroad by the
alien spouse capacitating him or her to remarry”. A divorce obtained abroad by two aliens, may
be recognized in the Philippines, provided it is consistent with their respective laws. Therefore,
before our courts can recognize a foreign divorce, the party pleading it must prove the divorce
as a fact and demonstrate its conformity to the foreign law allowing it.
In this case, the divorce decree between the respondent and Samson appears to be authentic,
issued by an Australian family court. Although, appearance is not sufficient; and compliance
with the rules on evidence regarding alleged foreign laws must be demonstrated, the decree
was admitted on account of petitioner’s failure to object properly because he objected to the fact
that it was not registered in the Local Civil Registry of Cabanatuan City, not to its admissibility.
Respondent claims that the Australian divorce decree, which was validly admitted as evidence,
adequately established his legal capacity to marry under Australian law. However, there are two
types of divorce, absolute divorce terminating the marriage and limited divorce merely
suspending the marriage. In this case, it is not known which type of divorce the respondent
procured.
Even after the divorce becomes absolute, the court may under some foreign statutes, still
restrict remarriage. Under the Australian divorce decree “a party to a marriage who marries
again before this decree becomes absolute commits the offense of bigamy”. This shows that the
divorce obtained by the respondent might have been restricted. Respondent also failed to
produce sufficient evidence showing the foreign law governing his status. Together with other
evidences submitted, they don’t absolutely establish his legal capacity to remarry according to
the alleged foreign law.
Case remanded to the court a quo. The marriage between the petitioner and respondent can
not be declared null and void based on lack of evidence conclusively showing the respondent’s
legal capacity to marry petitioner. With the lack of such evidence, the court a quo may declare
nullity of the parties’ marriage based on two existing marriage certificates.

ASIAVEST MERCHANT BANKERS (M) BERHAD vs. CA and PNCC

G.R. No. 110263, July 20, 2001
Facts: Petitioner Asiavest Merchant Bankers (M) Berhad is a corporation
organized under the laws of Malaysia while private respondent Philippine
National Construction Corporation is a corporation duly incorporated and
existing under Philippine laws.
Petitioner initiated a suit for collection against private respondent, then
known as Construction and Development Corporation of the Philippines,
before the High Court of Malaya in Kuala Lumpur entitled “Asiavest Merchant
Bankers (M) Berhad v. Asiavest CDCP Sdn. Bhd. and Construction and
Development Corporation of the Philippines.”

Petitioner sought to recover the indemnity of the performance bond it had put
up in favor of private respondent to guarantee the completion of the Felda
Project and the nonpayment of the loan it extended to Asiavest-CDCP Sdn.
Bhd. for the completion of Paloh Hanai and Kuantan By Pass; Project.

The High Court of Malaya (Commercial Division) rendered judgment in favor

of the petitioner and against the private respondent. Following unsuccessful
attempts to secure payment from private respondent under the judgment,
petitioner initiated the complaint before RTC of Pasig, Metro Manila, to
enforce the judgment of the High Court of Malaya.

Private respondent sought the dismissal of the case via a Motion to Dismiss,
contending that the alleged judgment of the High Court of Malaya should be
denied recognition or enforcement since on in face, it is tainted with want of
jurisdiction, want of notice to private respondent, collusion and/or fraud, and
there is a clear mistake of law or fact. Dismissal was, however, denied by the
trial court considering that the grounds relied upon are not the proper
grounds in a motion to dismiss under Rule 16 of the Revised Rules of Court.

Subsequently, private respondent filed its Answer with Compulsory Counter

claim’s and therein raised the grounds it brought up in its motion to dismiss.
In its Reply filed, the petitioner contended that the High Court of Malaya
acquired jurisdiction over the person of private respondent by its voluntary
submission the court’s jurisdiction through its appointed counsel.
Furthermore, private respondent’s counsel waived any and all objections to
the High Court’s jurisdiction in a pleading filed before the court.

In due time, the trial court rendered its decision dismissing petitioner’s
complaint. Petitioner interposed an appeal with the Court of Appeals, but the
appellate court dismissed the same and affirmed the decision of the trial court.

Issue: Whether or not the CA erred in denying recognition and enforcement to

the Malaysian Court judgment.
Ruling: Yes.
Generally, in the absence of a special compact, no sovereign is bound to give
effect within its dominion to a judgment rendered by a tribunal of another
country; however, the rules of comity, utility and convenience of nations have
established a usage among civilized states by which final judgments of foreign
courts of competent jurisdiction are reciprocally respected and rendered
efficacious under certain conditions that may vary in different countries.

In this jurisdiction, a valid judgment rendered by a foreign tribunal may be

recognized insofar as the immediate parties and the underlying cause of action
are concerned so long as it is convincingly shown that there has been an
opportunity for a full and fair hearing before a court of competent jurisdiction;
that the trial upon regular proceedings has been conducted, following due
citation or voluntary appearance of the defendant and under a system of
jurisprudence likely to secure an impartial administration of justice; and that
there is nothing to indicate either a prejudice in court and in the system of
laws under which it is sitting or fraud in procuring the judgment.

A foreign judgment is presumed to be valid and binding in the country from

which it comes, until a contrary showing, on the basis of a presumption of
regularity of proceedings and the giving of due notice in the foreign forum
Under Section 50(b), Rule 39 of the Revised Rules of Court, which was the
governing law at the time the instant case was decided by the trial court and
respondent appellate court, a judgment, against a person, of a tribunal of a
foreign country having jurisdiction to pronounce the same is presumptive
evidence of a right as between the parties and their successors in interest by a
subsequent title. The judgment may, however, be assailed by evidence of want
of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of
law or fact. In addition, under Section 3(n), Rule 131 of the Revised Rules of
Court, a court, whether in the Philippines or elsewhere, enjoys the
presumption that it was acting in the lawful exercise of its jurisdiction. Hence,
once the authenticity of the foreign judgment is proved, the party attacking a
foreign judgment, is tasked with the burden of overcoming its presumptive
validity.

In the instant case, petitioner sufficiently established the existence of the

money judgment of the High Court of Malaya by the evidence it offered.
Petitioner’s sole witness, testified to the effect that he is in active practice of
the law profession in Malaysia; that he was connected with Skrine and
Company as Legal Assistant up to 1981; that private respondent, then known
as Construction and Development Corporation of the Philippines, was sued by
his client, Asiavest Merchant Bankers (M) Berhad, in Kuala Lumpur; that the
writ of summons were served on March 17, 1983 at the registered office of
private respondent and on March 21, 1983 on Cora S. Deala, a financial
planning officer of private respondent for Southeast Asia operations; that
upon the filing of the case, Messrs. Allen and Gledhill, Advocates and
Solicitors, with address at 24th Floor, UMBC Building, Jalan Sulaiman, Kuala
Lumpur, entered their conditional appearance for private respondent
questioning the regularity of the service of the writ of summons but
subsequently withdrew the same when it realized that the writ was properly
served; that because private respondent failed to file a statement of defense
within two (2) weeks, petitioner filed an application for summary judgment
and submitted affidavits and documentary evidence in support of its claim;
that the matter was then heard before the High Court of Kuala Lumpur in a
series of dates where private respondent was represented by counsel; and that
the end result of all these proceedings is the judgment sought to be enforced.

In addition to the said testimonial evidence, petitioner also offered the

documentary evidence to support their claim.

Having thus proven, through the foregoing evidence, the existence and
authenticity of the foreign judgment, said foreign judgment enjoys
presumptive validity and the burden then fell upon the party who disputes its
validity, herein private respondent, to prove otherwise. However, private
respondent failed to sufficiently discharge the burden that fell upon it – to
prove by clear and convincing evidence the grounds which it relied upon to
prevent enforcement of the Malaysian High Court judgment.